Corn growers fear the Environmental Protection Agency's biofuel ruling Thursday could negatively impact corn prices. File Photo by Mike Theiler/UPI. | License Photo
EVANSVILLE, Ind., Dec. 19 (UPI) -- Farmers and ethanol groups expressed dismay Thursday after an Environmental Protection Agency ruling they say will reduce the amount of biofuels that American oil refiners are required to use next year.
The rule addresses how the EPA will account for the volume of biofuels it exempts from the Renewable Fuel Standard through hardship waivers for small refineries. The purpose of the rule is to redistribute those waived gallons.
When the Trump administration first announced the rule, it promised to calculate the waived gallons each year using a multiyear average of the amount previously exempt. But, the new rule changed that.
"The final rule uses a three-year average of the Department of Energy recommended waivers as an estimate for 2020 waivers rather than an average of actual gallons waived by the EPA," the National Corn Growers Association said in a statement.
Those energy department's recommendations account for roughly half the gallons that were actually waived, farm groups say.
The EPA said it might follow energy agency recommendations next year, but farm and ethanol groups were not convinced. They pushed for the EPA to use the actual waivers in their calculations.
"To say we are disappointed is an understatement," American Coalition for Ethanol Chief Executive Officer Brian Jennings said in a statement.
"While it was well understood this rulemaking would not make farmers and the ethanol industry 'whole' for the damage EPA has done by abusing the small refinery exemption provision of the RFS, we were led to believe the rule would represent a step in the right direction, an opportunity to account in a meaningful way for refinery waivers."
Corn and soy growers fear the ruling will reduce commodity prices.
"We're really discouraged by the EPA ruling," said Curt Mether, a corn and soybean grower in Iowa. "Anything that reduced ethanol demand is not good for us."