- - Thursday, March 17, 2016

ANALYSIS/OPINION:

The oil industry does not want to see renewable fuels such as ethanol succeed (“Renewable Fuel Standard deceit,” Web, Feb. 8). That’s why it’s spreading misinformation whenever it can to undermine public support for alternative energy and convince folks that that we can frack our way to prosperity. The recent op-ed by George Banks, the executive vice president of the American Council for Capital Formation, must be viewed in this context. Mr. Banks is a wholly owned subsidiary of big oil.

The Renewable Fuel Standard (RFS) has not “plagued our country by jacking up food and fuel costs,” as Mr. Banks alleges, but has instead provided tremendous benefits to our feed, fuel and food. Food-price inflation has continued its downward trend since the RFS was passed, and today consumers are spending a smaller portion of their income on food than they were before. Between 1980 and 2004, food prices increased by an average of 3.5 percent per year; in contrast, food prices have risen by an average of just 2.7 percent per year since 2005, the year the original RFS was adopted. This includes an increase of just 1 percent last year. Further, the world food price index in 2015 fell to its lowest point since the global financial crisis of 2009. Where is the skyrocketing food inflation, Mr. Banks?

Meanwhile, growth in ethanol production and use has helped to decrease reliance on crude oil imports. In 2005 America’s net dependence on foreign petroleum peaked at just over 60 percent. Net petroleum import dependence fell to just 25 percent in 2015, both because of increased domestic oil production and increased ethanol use. That percentage would have been 32 without the addition of 14.7 billion gallons of domestically produced ethanol to the fuel supply.

Ethanol is the lowest-cost octane source for refiners and automakers looking to maximize efficiency in advanced internal-combustion engines. One study concluded that ethanol has reduced consumer gasoline prices between 50 cents per gallon and $1.50 per gallon. Mr. Banks’ suggestion that ethanol has increased gasoline prices is simply fiction.

In 2015 U.S. ethanol plants in 29 states produced a record 14.7 billion gallons of high-octane renewable fuel, along with some 40 million metric tons of high-protein animal feed. The industry is an economic engine, supporting 85,967 direct jobs and 271,440 indirect jobs across all sectors of the economy last year. The industry also added $44 billion to the nation’s Gross Domestic Product in 2015 and paid $10 billion in taxes.

If we listen to Mr. Banks and repeal the RFS, all of these benefits will isappear. That doesn’t help consumers. That only helps big oil.

BOB DINNEEN

President & CEO

Renewable Fuels Association

Washington

LOAD COMMENTS ()

 

Click to Read More

Click to Hide