Earlier today Tom Vilsack, Secretary of Agriculture; Steven Chu, Secretary of Energy; and Lisa Jackson, Administrator of the Environmental Protection Agency (EPA) held a conference call to discuss the Obama Administration’s commitment to biofuels. Highlights of the call were EPA’s issuance of the Renewable Fuel Standard Program (RFS2) Notice of Proposed Rulemaking and the Department of Energy’s (DOE) announcement of $786.5 million in Recovery Act funds to accelerate biofuels research and commercialization.

Secretary Chu indicated that of the $786.5 million in Recovery Act funds, $480 million will go to soliciting integrated pilot- and demonstration-scale biorefineries; $176.5 million to commercial-scale biorefinery projects; $110 million to fundamental research in key program areas; and $20 million to ethanol research. Secretary Chu addressed questions about ethanol’s impact on food prices in the U.S., stating that our agricultural resources can provide food, both domestically and internationally, and much-needed energy.

Administrator Jackson focused on EPA’s commitment to the Energy Independence and Security Act (EISA) and stated that the proposed rulemaking implements EISA and grandfathers in 15 billion gallons of ethanol. She expressed the need for home-grown energy - specifically mentioning corn-based ethanol and cellulosic ethanol - to lower our dependence on foreign oil and our vulnerability to price spikes; reduce GHG emissions; create green jobs, especially in rural America; and meet the RFS of 36 billion gallons of ethanol by 2022. Administrator Jackson renewed her commitment to utilizing the best available science and indicated there would be a 60-day comment period on the proposal.

On the issue of indirect land use, which ClimateIntel previously examined, Administrator Jackson stated EPA is gathering peer reviews on satellite data, land conversion and other factors affecting GHG emissions. She added that EPA’s data shows that corn-based has 16% lower emissions than fossil fuel. She also stressed the need for development of new product technology for non-grandfathered, corn-based ethanol plants and new pathways for biodiesel to meet the 50% reduction required to comply with the EISA.

Secretary Vilsack discussed that USDA will work to create new biorefinery resources and convert existing refineries to biofuels. He indicated that the three agencies have drafted a memorandum that reflects Obama’s commitment to rural US, creates clean jobs and new opportunities, and creates additional income for farmers.

Today’s inter-agency commitment, backed by President Obama, to both corn-based and advanced biofuels is yet another boost to the ailing biofuels industry. In recent weeks, ClimateIntel reported on the Congressional Budgets Office’s report entitled “The Impact of Ethanol Use on Food Prices and Greenhouse-Gas Emissions,” and the E 15 waiver request. So far, at least, it appears that federal policy remains fully supportive of ethanol-based biofuels and reconciliation with the direction of the California-led effort to move away from such fuels remains for another day.

For further information about this topic, please contact Akin Gump.