The US Environmental Protection Agency's rejection of a formal request for a
scaling back of national renewable fuel standards has bought mixed reactions
from politicians and environmentalists.
Last week, the EPA
finally rejected
a request from the state of Texas, made in April, for a 50 per cent waiver of
the renewable fuel standard (RFS), citing concerns over the effect of the
targets on food prices
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The RFS mandates that an increasing amount of fuel be ethanol-based in the
coming years. It had required 5.14 billion barrels of ethanol to be produced in
2008, but the Energy Independence and Security Act passed in December raised it
to nine billion.
Texas had claimed that the knock on impact of the target on corn prices was
harming its economy, which relies heavily on livestock using corn for feed.
However, the EPA ruled that the economic harm was not sufficient to grant a
waiver.
"Good intentions and laudable goals are small compensation to the families,
farmers and ranchers who are being hurt by the federal government’s efforts to
trade food for fuel," responded Texas governor Rick Perry in a statement. "Any
government mandate that artificially props-up a single industry to the detriment
of millions of Americans is bad public policy."
Texas Department of Agriculture
commissioner Todd Staples underscored Perry's criticism with numbers, pointing
to a US Department
of Agriculture report that highlighted the the cost of farming has risen as
a result of biofuel policy. He argued that US farm production expenditures rose
to a record $260bn last year – up 9.3 per cent from 2006.
Large poultry producer Pilgrim's
Pride, which uses corn as feed for its chickens, said that costs would
increase $900m over the last fiscal year because of inflated pricing. "Not only
are the 2008 mandates destructive, but the scheduled mandate next year will
again increase another 16.7 per cent from corn, consuming an additional 4.5 per
cent or more of the 2009-2010 corn crop than the anticipated 34 per cent of the
crop being consumed this year for ethanol production," it said.
However, not everyone condemned the news. "Our farmers are producing enough
corn for our food, feed and fuel needs, and the growing ethanol industry is
reducing our dependence on foreign oil," argued Ben Nelson, Senator for large
corn producing state Nebraska, in a statement. "It is helping to hold down our
high gas prices and it is providing home-grown economic growth in many states,
including Nebraska."
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