U.S. Legislative Issues

 

The Department of Energy’s (DOE) Clean Cities alternative fuels and vehicle deployment program advances markets for alternative fuels and vehicles that are primarily domestically produced. In doing so, Clean Cities helps to stabilize gasoline prices, decrease U.S. reliance on foreign oil, and create American jobs. 

According to DOE annual reports, from 2006 through 2015, Clean Cities leveraged $207.3 million in program funding into another $2.2 billion in state, local, and private investment in alternative fuels deployment projects. This is an overall leverage ratio of $10.60 for every $1 in the Clean Cities budget. These funds were used to deploy a diverse array of petroleum reducing fuels, vehicles and refueling stations that were based on specific state and local transportation needs. Clean Cities has developed projects that have reduced petroleum consumption by more than 8.5 billion gallons. The program is on track to decrease petroleum use by 2.5 billion gallons annually by 2020.

Despite this record of success, the White House budget is seeking to eliminate funding for Clean Cities by dramatically reducing the DOE Vehicles Technologies program by 73%, from $307 million to $82 million. In response, NAFA sent a letter to leaders of the House and Senate Energy and Water Appropriations Subcommittees urging them to maintain adequate funding for this important program in Fiscal Year (FY) 2018. 

In its letter, NAFA underscored "the important role stability and predictability play in federal support for alternative fuels and advanced technology vehicles to allow long-term private sector planning and investment to occur efficiently." To that end, NAFA concluded that "now is the time for Congress to maintain critical investment in the deployment of clean, domestically produced fuels and vehicles" by providing robust funding for this highly effective program.

Interested NAFA members can express their support for the Clean Cities program here.

 

On July 5, the U.S. Environmental Protection Agency (EPA) issued proposed volume requirements under the Renewable Fuel Standard (RFS) program for cellulosic biofuel, advanced biofuel, and total renewable fuel for calendar year 2018. EPA also proposed biomass-based diesel volume standards for calendar year 2019. In summary, the proposal:

•  Keeps conventional corn ethanol at 15 billion gallons in 2018;
• Drops cellulosic biofuel, considered to be the next generation of ethanol, by 73 million gallons to 238 million gallons in 2018; and,
• Keeps biodiesel at 2.1 billion gallons in 2019 same as 2018.

Upon their release, EPA Administrator Scott Pruitt said the proposed volumes are "consistent with market realities" and that "they’re focused on actual production and consumer demand while being cognizant of the challenges that exist in bringing advanced biofuels into the marketplace."

Congress adopted the RFS in 2005 and expanded it in 2007, wanting a cleaner source of fuel that makes the nation less reliant on foreign oil production. The program requires oil companies to blend increasing volumes of renewable fuels with gasoline and diesel, culminating with 36 billion gallons in 2022.

The EPA is expected to open a 45-day public comment period on the proposed rule following its publication in the Federal Register.

 

 NAFA Weighs in on E15 and Renewable Diesel Proposals

 

On July 5, 2017, NAFA sent a letter to Sens. John Barrasso (R-WY) and Tom Carper (D-DE), Chairman and Ranking Member of the Senate Committee on Environment and Public Works, to express its opposition to S.517, the Consumer Fuel and Retailer Choice Act. Sponsored by Sen. Deb Fischer (R-NE), S. 517 would extend the Reid vapor pressure (RVP) waiver to ethanol blends above 10 percent and allow retailers and fuel markers across the country to sell E15 year-round. 

In its letter, NAFA highlighted fleet managers’ concerns that E15 will void warranties, damage engines, and cause damage to underground storage tank systems. To that end, NAFA urged Committee leaders to draft new legislation that protects fleets and consumers. Such legislation should rescind the partial waiver for E15 and establish gasoline blended with up to 10 percent ethanol as the general purpose domestic fuel, NAFA concluded.

NAFA also sent a July 5 letter to leaders of the Senate Finance and House Ways and Means Committees in opposition to S.944 and similar legislative proposals that would change the biodiesel and renewable diesel tax credit to a production tax credit. 

 

 

The U.S. Environmental Protection Agency (EPA) is considering a proposal concerning the "point of obligation" under the Renewable Fuel Standard (RFS). Refiners and importers would like to move their legal obligations under the RFS on to downstream entities – fleets, blenders, marketers or retailers.

Under such a change, those fleets which purchase gasoline and diesel from the terminal – "above the rack" – rather than from a marketer, would assume the obligation for blending ethanol and biodiesel into the fuel supply.

NAFA is currently working to determine the impact of this proposal on NAFA members.  If you purchase diesel or gasoline from the terminal, please advise NAFA’s U.S. Legislative Counsel, Pat O’Connor, at poconnor@nafa.org.