Trump escalates RFS drama in DC, as ABLC opens, asks to meet with industry leaders

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President Trump calls for face-to-face meetings with biofuels leaders; at right, Iowa Senators Grassley and Erntz, leading the pro-RFS forces

In Washington, President Trump has requested a face-to-face meeting on Thursday with leaders of the US biofuels industry after talks between Big Oil and pro-biofuels forces over the Renewable Fuel Standard concluded today with what Senator Charles Grassley described as “No deal on RFS reform and no assurances or commitments” either to petroleum or biofuels interests.

The President’s dramatic call to meet directly with industry leaders comes as more than 500 of those leaders are arriving in Washington for ABLC 2018, the Advanced Bioeconomy Leadership Conference, which opens  Wednesday at midday and continues through Friday evening. No details have yet emerged on the Thursday meetings, although a current list of ABLC delegates has been provided to the White House.

The high-level talks at the White House today included the President, EPA Adnminstrator Scott Pruitt, Secretary of Agriculture Sonny Perdue, Secretary of Energy Rick Perry, Senators Cruz, Erntz, Grassley, and Toomey, and White House staff. According to Sen. Erntz, there was no progress in the meeting from similar talks held in December.

At the heart of the controversy over RINs is the recent bankruptcy of  Philadelphia-Area refinery PES, whose ownership blamed RIN prices and the Renewable Fuel Standard for the financial debacle. But news outlets including the Digest and Reuters have been reporting that the owners of the refinery had in the past five years pulled more than $500 million in dividends out of the refinery — more than the refinery cost them — and Joelle Simonpietri’s analysis here cast considerable doubt on the role of RIN prices in the refinery’s bankruptcy.

“The President is concerned about jobs, and the loss of jobs is devastating to the people affected,” Senator Charles Grassley of Iowa told reporters this afternoon, “but it is important that we be honest with ourselves, and look at the facts before we draw conclusions.” Referring to the ethanol industry, the Senator added that “the facts are on our side.”

“There is no independent, respected study we have seen that indicates that RINs are the problem for these refineries,” said Senator Joni Erntz of Iowa. “Many refineries have increased their profits significantly in recent quarters, and they have to deal with RINs as well. Senator Toomey and Senator Cruz have never been fond of the RFS, and it appears that this is just another way to strike at it. But what we really need is to understand what problem there is, before we can begin to find a solution.”

Industry reaction

Industry leaders chimed in their support in a flurry of statements released this afternoon.

Kyle Gilley, POET Senior Vice President of External Affairs & Communications said, “Everything Sen. Cruz has offered would gut the Renewable Fuel Standard and halt expansion of homegrown biofuels here in the US. It is unfortunate that Midwest farmers – suffering from an ag crisis today – are being put in this tenuous position based on the bogus narrative being stoked by Sen. Cruz.”

“A solution exists to both lower RIN prices and expand biofuels use. Relief from outdated Reid Vapor Pressure regulations would give US drivers greater access to high-octane E15 and increase the number of RINs available to refiners.

“Senator Cruz is working with administration allies to unravel the regulatory framework of the Renewable Fuel Standard.  Our environment, air quality, economy and family farms across America are at risk because of their reckless actions. The RFS works. Any efforts to alter its framework to benefit fossil fuel companies will only hurt rural communities and farmers.”

Growth Energy CEO Emily Skor added, “We are grateful to our Senate champions, Sens. Grassley and Ernst, for continuing to stand up for the biofuels industry and against any proposal that would lead to a loss of jobs across America’s heartland.

Northey confirmed

In related news, Senator Cruz lifted a hold on the confirmation of Iowa Secretary of Agriculture as US Under Secretary of Agriculture for Farm Production and Conservation, and Northey received Senate confirmation and will take up his post as soon as he is sworn in.

Iowa Biodiesel Board Executive Director Grant Kimberley said “We congratulate Bill Northey, who will be a great advocate for farmers nationwide. As a farmer, and as Iowa’s Secretary of Agriculture, his background and experience will be critical as Congress begins crafting a new farm bill in 2018. Bill has always been a staunch supporter of renewable fuels, like biodiesel, and the Renewable Fuel Standard, and his department in Iowa capably administered important programs like the Iowa Renewable Fuels Infrastructure Program. We know he will make Iowa proud once again.

Skor said, “We congratulate Undersecretary Northey on his new role. He will be a powerful voice for this administration’s efforts to create rural jobs and promote American dominance in biofuels. Hopefully, this unanimous confirmation signals an end to misleading attacks on homegrown biofuels and the start of a serious conversation about polices like RVP relief, which would open a vital market for American-made biofuels and increase the supply of RINs, while protecting surging refinery profits.”