Proposed Renewable Fuel Standards Could Threaten SD Ethanol Industry

Aug 13, 2019

Credit Kealey Bultena / SDPB

The Renewable Fuel Standard is a federal program authorized in 2005 requiring fuel sold in the United States to contain a certain amount of renewable fuel.  A waiver program was put in place to help small refineries disproportionately affected by these programs.  Some South Dakota corn producers say recent expansion of the waiver program under the Trump administration is having a negative impact on the state’s ag industry.

Scott Stahl is the Vice President of South Dakota Corn Growers.  He says South Dakota has benefited from the renewable fuel industry.

Stahl says ethanol has created opportunities for younger producers to enter the market. 

He says international trade and the RFS gave agriculture a foothold in the market that has been undermined by current policies. He says this compounds the hardship South Dakota farmers already face.

“We need a win.  We’re looking for a win, as producers, and e-15, we are thankful to see that but we need to build some momentum and help create demand, because the demand destruction – at the end of the day – it hurts farmers but it also hurts everybody that relies upon the farming and ag industry in South Dakota,” says Stahl.

Stahl says the ethanol plants across the state have created more domestic demand and support other areas of local agriculture.

Rob Walther is the Vice President of federal policy at POET.  He says the Renewable Fuel Standard and the biofuel industry are under attack from the oil industry.

Walther says measures like RVP E-15, which allows the year-round sale of E-15 fuel, represents a success but not a win.

He says the waivers were originally intended to help small refineries disproportionately affected by the RFS

“Unfortunately this administration – and it started under Scott Pruitt, who is no friend of bio-fuels or the Midwest – started giving out these waivers to any refiner who applied,” says Walther.

Walther says the Trump administration is moving forward with even more of these waivers leading to another 1.4 billion gallons of ethanol being cut. He says expanded waivers threaten the ability of ethanol to compete in a free market and does real harm to South Dakotas ag industry.