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Grassley flexes political muscle for biodiesel

Article cover photo
Dozens of Iowans, including Sen. Charles Grassley, signed a banner Tuesday during a meeting at REG's biodiesel plant in Newton urging Trump not to let EPA break his promise to rural America concerning renewable fuels. (Photos: Joseph Murphy/Iowa Soybean Association)

By Matthew Wilde, ISA senior writer

A showdown is looming on Capitol Hill over renewable fuels and biodiesel, and the industry’s most powerful political ally is ready for a fight.

Sen. Chuck Grassley and several senators plan to meet with Environmental Protection Agency (EPA) Administer Scott Pruitt next week to voice their displeasure with the agency’s latest attempt to gut the Renewable Fuels Standard (RFS) and biodiesel. He announced the meeting Tuesday during a biodiesel press conference and rally at Renewable Energy Group’s (REG) Newton biodiesel plant.

Grassley said Pruitt’s recent proposal to slash biodiesel volumes is contrary to assurances he made to uphold President Donald Trump’s repeated promises to support renewable fuels.

“We’re going to make it very clear where the president is coming from and what he (Pruitt) told us in January during his nomination process,” Grassley said. “Stick to your word.

“A platform isn’t just something to run on, it’s to stand on,” he added.

Iowa’s senior senator told the standing-room-only crowd of more than 70 farmers and biofuel advocates, including many Iowa Soybean Association (ISA) leaders, he intends to do everything in his power to make that happen.

Grassley believes the Oct. 17 meeting, which he spearheaded, will get Pruitt and the EPA “back on track.”

“My confidence level is based on what the president has said in a couple conversations with him,” Grassley said. “The president is the chief executive and Pruitt works for him and the American people. He has to listen to his boss.”

The EPA put out a Notice of Data Availability (NODA) Sept. 26 requesting comment on options for reducing 2018 RFS requirements that were set last year.

The agency asked about the possibility of lowering targets by 315 million gallons for biomass-based biodiesel and 473 million gallons for advance biofuels and total renewable volumes. EPA cited:

  • Previously set targets may not be attainable due to the expiration of the federal biodiesel blenders tax credit last year.
  • A reduction in renewable diesel imports from Indonesia and biodiesel from Argentina because of new anti-dumping duties.
  • Both could translate to higher fuel prices.

In July, the agency proposed reducing the 2019 advanced biofuel mandate, which is the predominant contributor, by 40 million ethanol-equivalent gallons. The biomass-based diesel proposed volume was flatlined. The NODA also seeks comment to reduce 2019 levels, potentially back to 1 billion gallons.

Grant Kimberley, Iowa Biodiesel Board (IBB) executive director and ISA market development director, said reductions would be devastating.

“Gutting the RFS would worsen the struggle farmers are already facing and could push us even deeper in an ag recession,” he said, noting soybean oil is the most common feedstock. “I urge President Trump and the EPA not to buckle to the interests of big oil companies, but stay true to promises made on the campaign trail to benefit Iowans and all Americans.”

According to Kimberley, biodiesel:

  • Supports 3,800 Iowa jobs and 64,000 U.S. jobs.
  • Supplies $300 million of Iowa household income.
  • Contributes over $480 million to Iowa’s gross domestic product.
  • Increases soybean prices by 63 cents per bushel and lowers soybean meal costs by $21 per ton.
  • The U.S. biomass-based diesel industry has 4.24 billion gallons of registered capacity, per EPA statistics, but produced more than 1.8 billion gallons domestically last year.
Iowa Biodiesel Board Director Grant Kimberley says gutting the Renewable Fuel Standard would be a devastating blow to Iowa's ag economy during a meeting at REG in Newton.

Grassley acts

The day the NODA was released, Grassley used Twitter and an impassioned speech on the Senate floor to denounce the proposal, which drew the attention of the Trump administration.

The senator disclosed he had a three-way phone conversation earlier this month with the president and “someone very much involved in the conversation” about the RFS. This comes on the heels of another phone call from the president asking Grassley to tell Iowans he supports ethanol and biofuels.

“The president speaks very plainly,” Grassley said.

The $1 per gallon biodiesel tax credit could soon be resurrected and reformed that would lend less credence to EPA’s rationale to reduce biodiesel volumes.

Grassley introduced a bill, pushed by the National Biodiesel Board (NBB), to retroactively renew the credit and change it to a producer benefit. The idea is to encourage more domestic production.

The senator expects the legislation will be part of a tax reform package this fall or an extenders bill like it has in the past.

“Either way, I think we will move it along,” Grassley said.

Ron Heck, a longtime biodiesel advocate and farmer from Perry, praised the senator for his support of the industry and agriculture. Heck was one of several speakers at the press conference.

The former ISA and American Soybean Association president is now an IBB and NBB farmer-leader. He said watching the growth of biodiesel industry is one of his greatest joys in public service.

He asked farmers, renewable fuel supporters and anyone who eats — biodiesel reduces feed costs, thus food costs, Heck said — to tell the EPA and Congress not to mess with the RFS. It was signed into law by President George W. Bush to expand the nation’s renewable fuels sector and reduce the reliance on imported oil.

“We need to make a little more noise and make sure the EPA does what it says it would and follow the law,” Heck said.

It’s on ongoing battle, said Brad Albin, REG vice president of manufacturing. The company is the nation’s largest biodiesel producer with 11 plants in the U.S. and two in Germany with more than 400 million gallons of capacity.

Albin is confident the EPA will back down.

“We’re a tenacious group,” he said. “We have a great product and we will fight for it.”

Senator Grassley, pictured with Brad Albin with REG and Iowa Biodiesel Board Executive Director Grant Kimberley, told the crowd he introduced a bill to retroactively renew the $1 per gallon biodiesel tax credit.

Call to Action

Dozens of Iowans, including Grassley, signed a banner Tuesday urging Trump not to let EPA break his promise to rural America concerning renewable fuels.

NBB officials suggest supporters contact the EPA by phone and/or email. Visit www.biodiesel.org or www.nbb.org to find out more. Click on the “Fueling Action” icon to submit a pre-drafted letter or personalized comments to the agency by Oct. 19.

Or, contact the White House by phone and email: https://www.whitehouse.gov/contact.

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For permission to republish articles or to request high-res photos contact Aaron Putze at aputze@iasoybeans.com.

©2017 Iowa Soybean Association On-Farm Network®. All rights reserved. On-Farm Network® is a registered trademark of the Iowa Soybean Association, Ankeny, IA.Portions of some On-Farm Network trials are paid for in total or in part by the soybean checkoff.

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August 2017 Contact Ann Clinton for past publications.