In 2007, Congress delivered what it thought was a big ticket solution to global climate change: a massive biofuel mandate under the banner of the Energy Independence and Security Act.
It was a gift to agribusiness and the farm lobby in the form of a 36 billion gallon biofuel production requirement that had to be met by 2022.
Since then, corn ethanol has been a boom-and-bust business, with scientific evidence calling into the question its environmental benefits and raising concern about its impact on the global food supply.
Today, the Obama administration brought intelligence and teamwork to bear on the biofuel mess, for the first time proposing federal rules that consider the impact of U.S. biofuels on the world beyond the agribusiness lobby. And it is acknowledging that while advanced biofuels have great potential, corn ethanol is only tolerable as a bridge to the future.
EPA Administrator Lisa Jackson announced an update to the federal renewable fuels standard that favors advanced biofuels and cellulosic ethanol over corn ethanol as the volume of renewable fuels blended with transportation fuels gradually increases.
Not all biofuels will qualify, though, and that's where Jackson's EPA is raising the bar. The new standard will gauge each biofuel's greenhouse gas emissions, not just at the tailpipe, but cradle to grave – and then some.
Following California's lead, the EPA plans to also factor in increased greenhouse gas emissions caused by what the experts call "indirect land use changes." When forests or grasslands overseas are stripped in order to grow crops to make up for U.S. cropland that was turned to biofuel, there's a price to pay.
The indirect land use changes will hit corn ethanol the hardest, as the administration was clearly aware today.
Before Jackson announced the proposed fuel rule, Agriculture Secretary Tom Vilsack joined Energy Secretary Steven Chu in announcing $786 million in new funding plus technical assistance to help farmers and refiners shift to lower-carbon biofuels. President Obama also signed a memorandum setting up an interagency working group to create a comprehensive biofuels program with Energy, Agriculture and EPA working together to focus on sustainable development.
Fifteen billion gallons of ethanol production will be grandfathered in under the proposed rule, most of it corn ethanol. But by 2022, 21 billion gallons of the 36 billion total would have to come from advanced biofuels, biomass diesel and cellulosic biofuels.
"Corn-based ethanol is a bridge to the next generation of biofuels," Jackson said.
Fully phased in, she said, the rule would cut the United States' dependence of foreign oil by more than 297 million barrels a year and reduce greenhouse gas emissions by an average of 160 million tons a year.
"This is a good day for rural America," Vilsack, a former Iowa governor, told reporters while discussing the grants that will help farms make the switch to lower-carbon biofuels.
The ethanol industry and its farm state senators aren't so sure about that. Twelve senators, including both of Iowa's, wrote to Jackson in March urging her not to include indirect land use changes (ILUC) in the lifecycle calculations on the grounds that the models were still evolving.
"Given the complexity and uncertainty of this issue as well as what we believe are basic analytical limitations, we urge EPA to refrain from including any calculations of the ILUC components," they wrote. "The premature publication and use of inaccurate or incomplete data could compromise the ability to formulate a sound approach to implementing this lifecycle GHG emissions requirement in the future. And the resultant rulemaking confusion could seriously harm our U.S. biofuels growth strategy by introducing uncertainty and discouraging future investments."
The Union of Concerned Scientists has a different point of view on indirect land use calculations:
"There are uncertainties inherent in estimating the magnitude of indirect land use emissions from biofuels, but assigning a value of zero is clearly not supported by the science. The data on land use change indicate that the emissions related to biofuels are significant and can be quite large. "
California's low carbon fuel standard also drew an angry backlash from ethanol producers and refiners at a hearing last month over its use of indirect land use changes. When indirect land use changes are ignored, corn ethanol is lower in carbon intensity than gasoline; but factor in indirect land use changes and the equation shifts.
According to the Air Resources Board's numbers, one acre of cropland devoted to corn ethanol produces 400 gallons of ethanol per year, saving 1 metric ton of carbon dioxide emissions annually. However, it indirectly causes about 0.3 acres of grassland and forest to be converted to agriculture, the equivalent of about 30 metric tons of CO2 being released. That means a 30-year payback.
California worked with the EPA in writing the standards, and it plans to look at the EPA's treatment of indirect land use changes as it refines its own low-carbon fuel standard, set to take effect in 2012, Air Resources Board Chair Mary Nichols said.
So far, Nichols said, the EPA numbers are in line with what California found.
"Based on what we have heard, we don't expect any immediate revisions," Nichols said.
California often leads the way for the nation on environmental improvements. Nichols would like to see Congress pass a federal low carbon fuel standard next "that moves beyond a volume mandate for blended fuels to a standard that will drive continual progress toward lower carbon fuels and not be limited only to biofuels."
Friends of the Earth Energy Policy Campaigner Kate McMahon applauded the EPA's move:
"The devil is always in the details, but we're pleased that the EPA's proposed rules would require all global warming pollution from biofuels to be taken into account.
Crucially, the EPA has rejected corporate agribusiness's demand that pollution from land use change be ignored. Demand for land on which to grow crops for biofuels can lead to deforestation and destruction of grasslands and wetlands, resulting in substantial global warming pollution.
"Indeed, because of land use impacts, most biofuels actually cause more global warming pollution than conventional gasoline."
Now that EPA is working with both the Energy and Agriculture Departments, that could start to change.
UPDATE (May 6): The farm-state backlash to the EPA's updated renewable fuels standard was swift, with the Waxman-Markey climate bill becoming a prime target today. Rep. Colin Peterson (D-Minn.), chairman of the House Agriculture Committee, told administration officials: "I want this message sent back down the street. I will not support any climate change bill. I don't trust anybody anymore."