A request to reduce the nationwide renewable fuels standard has been denied by the Environmental Protection Agency (EPA), according to agency information.
As a result, the required total volume of renewable fuels, such as ethanol and biodiesel, mandated by law to be blended into the fuel supply will remain at nine billion gallons in 2008 and 11.1 billion gallons in 2009, according to EPA.
The request came Texas Gov Rick Perry who had asked for a reduction in the standard of 50 percent in what he said would help reduce rising food costs driven by ethanol production from grain.
Perry said at the time of the request that in 2007, 25 percent of the US corn crop was diverted to produce ethanol, according to the United States Department of Agriculture, which projects that 30 to 35 percent will be diverted in 2008. "With ever increasing mandates of corn crop diversion to ethanol production through 2015, the impact on food prices globally, and to Texas specifically will only worsen," he said.
The National Biodiesel Board say in responding to the EPA decision: "It is important to note that all renewable fuels qualify for the current RFS. In fact, if the RFS is waived or cut in half in 2008, then the growth of all biofuels, including 'advanced biofuels' such as biodiesel, would be severely hindered."
The American Coalition for Ethanol also weighed into the debate, releasing a statement: "Just because Big Food companies feel they are entitled to cheap corn forever does not justify their politically-driven effort to dismantle ethanol policy. Today's ruling by EPA sets a precedent for others who would try to influence ethanol policy relying upon dishonest PR attacks instead of science and hard data." The coalition argued that independent economic experts agree that biofuels-related feedstock demand has very little to do with retail food prices and said that the US Department of Agriculture and Department of Energy have stated 96-97 percent of the food price increase has nothing to do with ethanol.
Current law authorizes EPA to waive the national standard if the agency determines that the mandated biofuel volumes would cause “severe harm” to the economy or the environment, EPA said in its news release. "The agency recognizes that high commodity prices are having economic impacts, but EPA’s extensive analysis of Texas’ request found no compelling evidence that the standard mandate is causing severe economic harm during the time period specified by Texas," EPA said.