Early this week a federal government study revealed that cellulosic ethanol has a greater negative short-term impact on global warming than gasoline. The current standard requires that cellulosic biofuels release 60 percent less carbon pollution than gasoline.
According to the study, while biofuels are better in the long run, they do not meet the standard set in a 2007 which qualifies them as a renewable fuel. Not being able to reach that threshold would cost producers of cellulosic biofuels the $1 per gallon subsidy they need to compete with gasoline.
Administration officials and the biofuel industry immediately criticized the research as flawed.
On the heels of the report, Fuels America, a coalition of organizations committed to protecting America’s Renewable Fuel Standard, released a study showing the positive impact renewable fuels has had the economy. According to the report, the Renewable Fuel Standard, or RFS, is responsible for spurring billions of dollars of economic activity from Maine to California.
Fuels America says the RFS has created nearly $185 billion of economic output; created over 852,000 jobs and $14.5 billion in taxes.
In Iowa, the nation’s top corn producing state, the study showed the impact of renewable fuels as driving over $19 billion in economic activity, supporting over 73,000 jobs while generating $640 million in state tax revenue each year.
Governor Terry Branstad, R-Iowa: "Don't mess with the RFS!"
Last November, the Environmental Protection Agency’s proposal to reduce the amount of renewable fuels blended into America’s gasoline and diesel supplies by nearly 3 billion gallons was met with resistance.
Governor Terry Branstad, R-Iowa: "And let the EPA know, this proposal is bad for Iowa; bad for our farmers; bad for our families; bad for our environment; bad our communities; and it is bad policy and they need to reverse it!"
Iowa will likely be ground zero in any battle over renewable fuels. The Hawkeye State leads the nation in ethanol production and is home to more than 40 biorefineries which produce nearly one-third of America’s ethanol.