By Steven Mufson and Chris Mooney
President Trump on Thursday sought to soothe U.S. farmers by signaling a move aimed at promoting the use of ethanol, a corn-based fuel and revenue source for some farmers.
The move would reassure a key Trump constituency that has been rocked by the U.S.-China tariff tension, including threats from Beijing to raise levies on imports of U.S. soybeans.
“We’re going to raise it up to 15 percent and raise it to a 12-month period,” Trump said during a White House photo opportunity, apparently referring to E15, a motor fuel containing 15 percent corn-based ethanol. Currently, E15 cannot be sold year round because of seasonal air pollution concerns. Under the federal Renewable Fuels Standard, fuel at the gas pump today usually contains only 10 percent ethanol.
Trump’s ethanol suggestion also throws a bone to Iowa Republican Sen. Charles E. Grassley, a strong supporter of the ethanol industry who chairs the powerful Judiciary Committee.
But Trump’s gesture was undercut by the Environmental Protection Agency, which has been giving small refineries “hardship” exemptions from congressionally mandated renewable-fuel requirements — which ethanol advocates say will decrease the use of the fuel.
There are more than 50 small refineries with up to 75,000 barrels a day of capacity each in the United States, including ones that belong to ExxonMobil and Chevron. The firm Andeavor has four small refineries. The EPA exemption, meant to help financially ailing refiners, means the companies could save tens of millions of dollars or more that they would otherwise have had to spend fulfilling the requirements of a complex system of credits.
“Is it the Administration’s position that companies making billions of dollars in profits are experiencing hardship?” Grassley and four other senators from Midwestern states asked in an angry letter released early Thursday evening. They accused EPA Administrator Scott Pruitt and oil companies of being engaged in “another backdoor attempt … to destroy the Renewable Fuel Standard and circumvent congressional intent,” they wrote.
The level of ethanol in motor fuel has long divided companies, farmers and environmental groups, pitting state lawmakers against big oil companies and raising questions about the homegrown fuel’s environmental costs and benefits.
And it has become a touchstone for presidential hopefuls seeking to win votes in Iowa. Trump during his campaign promised to promote ethanol.
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