Why Renewable Fuel Standard matters
Published on -4/7/2014, 9:23 AM
When it comes to developing alternatives to fossil fuels and foreign oil, should the United States move forward or backward?
That's the issue before the federal Environmental Protection Administration as it decides whether to reverse its proposal to reduce the amount of biofuels that must be blended into the nation's motor fuel supply.
The EPA's proposal would weaken one of the most successful energy policies ever implemented in the U.S., the Renewable Fuel Standard.
Supported by both parties in both Houses of Congress, signed into law by then-President Bush, and backed by President Obama, the RFS has nurtured the growth of the U.S. ethanol industry that supports approximately 390,000 direct and indirect jobs, added $44 billion to the economy in 2013, paid $8.3 billion in taxes, reduced our dependence on imported oil from 60 percent in 2005 to 41 percent in 2012, and cuts greenhouse gas emissions by 25 percent to 40 percent, compared to gasoline.
As I testified at an EPA public hearing in December, Kansans have a stake in the RFS. In spite of the national downturn, the U.S. ethanol industry has revived rural economies and created good jobs -- 46 percent paying more than $75,000 a year, 96 percent providing health insurance, and 92 percent offering retirement plans. By spending $36.1 billion on crops and other goods and services, ethanol provides a stable market for farmers and local businesses.
Now the nation's ninth largest ethanol producer, Kansas' 12 ethanol plants support approxiately 13,000 jobs, while creating a market for nearly 183 million bushels of sorghum and corn. Thanks largely to ethanol, Kansas has the nation's ninth lowest unemployment rate.
Preserving the U.S. ethanol industry and the policies that promote it are intensely personal for me. I have proudly served in this industry since 1996 and am CEO of East Kansas Agri-Energy in Garnett, a rural community with a population of approximately 3,000 in Anderson County.
As the U.S. ethanol production grew from less than 1 billion gallons to more than 13 billion, I saw the positive effect on local economies in Kansas and throughout the Midwest. Before our facility, Anderson County was one of the poorest counties in Kansas. Now, with our company's substantial investment in ethanol production, the area is beginning to boom and thrive.
But all this economic progress could be reversed if the EPA weakens the RFS. This proposal could destabilize rural economies, just as farmers are expecting a near-record corn crop, while jeopardizing tens of thousands of high-paying, family-supporting, jobs that can't be outsourced overseas.
Moreover, the EPA's proposal would strand billions of dollars of private capital investments by renewable fuel producers who have brought the industry from infancy to maturity because of the stability provided by the RFS. With the industry on the cusp of commercializing the next generation of even more environmentally-friendly biofuels, the EPA must not throw this progress into reverse gear.
As a Marine Corps veteran, I am proud the ethanol industry reduces our dangerous dependency on foreign oil. As our country reduces the $1 billion-a-day we spend on foreign oil, often from unfriendly or unstable countries, we will stop paying for the petroleum profits of our enemies. And we will have less need to defend oil routes and put our troops in harm's way, at a terrible human and financial cost.
If the EPA's proposal takes effect, the losers will include economic growth and job creation, especially in rural America, as well as our natural environment and our national effort to end our addiction to imported oil.
The only winner will be Big Oil, which desperately wants to maintain its monopoly over the nation's gasoline pumps and fuel tanks. Having known since 2007 the RFS would require ethanol blends greater than 10 percent, the oil companies have refused to make the investments in the infrastructure to offer motorists more choices at the pump. Now, the oil companies and the EPA are using the resulting "blend wall" as a justification for weakening the RFS.
The RFS program was designed to force the oil industry to change, for the sake of our economy, our environment, and our energy security. Let's keep moving forward.
Kansans should tell the EPA, loud and clear, "Don't mess with the RFS."
Jeff Oestmann is a former U.S. Marine Corps Embassy Guard and president/CEO of East Kansas Agri Energy, an ethanol producer in Garnett.