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BIO Responds to GAO Report Declaring RFS Will Not Meet Goals

November 29, 2016

Washington, DC (November 29, 2016) – Brent Erickson, Executive Vice President, Industrial and Environmental at the Biotechnology Innovation Organization (BIO), released the following statement today in response to the U.S. Government Accountability Office (GAO)’s latest report on the Renewable Fuel Standard (RFS), “Renewable Fuel Standard, Program Unlikely to Meet its Targets for Reducing Greenhouse Gas Emissions.” GAO correctly concludes the technology is available for advance biofuels but we would observe that EPA has chilled investment in commercializing this technology.

“BIO believes that the Environmental Protection Agency’s (EPA) actions over the last few years delayed the success of the RFS program and shaped the outcomes identified in this GAO report. While the recession and the challenges of developing new technologies have been factors, EPA’s unlawful interpretation of its authority under the program and delays in rulemaking since 2013 have been the primary drivers of a multibillion dollar shortfall in investment for advanced biofuel production, which GAO notes in its report.

“BIO has noted that EPA’s delays and methodology for setting the annual RFS chilled investment in advanced biofuels. Based on BIO’s findings, investment patterns clearly demonstrate that EPA is sending a sustained market signal that disincentivizes advanced biofuels, causing a $22.4 billion shortfall in necessary investment.

“Further, EPA continues to be too slow in making decisions on RFS pathway review and approval process. Petition review and approvals for advanced biofuel companies have averaged more than three years. These lengthy waits for approval of new pathways discourage investment in commercial production of advanced and cellulosic biofuels. Under these conditions, companies have found it difficult to attract the necessary investment to initiate, continue, and complete the construction and startup of new facilities; a number have delayed or abandoned their commercialization plans.

“The GAO report also notes that the program is unlikely to meet its targets for reducing greenhouse gas emissions. BIO has repeatedly pointed out that EPA’s delays and reductions in the annual volumes have caused increases in transportation-related greenhouse gas emissions. BIO estimates that emissions increased by 72 million metric tons in 2014 and again by 22.9 million metric tons in 2015 because of EPA reducing biofuel volumes and delays in getting the rule out. However, the report fails to note that over its first 10-years the RFS reduced U.S. transportation-related carbon emissions by 589.33 million metric tons. The total reduction is equivalent to removing more than 124 million cars from the road over the decade. Further the GAO report fails to point out if EPA had maintained the successful approach to the RFS that it used in 2013, EPA could have considerably limited greenhouse gas emissions from the increase in transportation fuel use.

“While the findings in this report grab headlines, they should not be surprising. Unfortunately, political uncertainty and the actions taken by the EPA have undermined the goals of the RFS statute. With EPA now abandoning its legally flawed reliance on general waiver authority as a basis for departing from statutory biofuels volumes requirements in its final rule for the 2017 RFS, the agency has sent a strong signal that it will support the biofuels industry and grow advanced and cellulosic biofuel production. This will allow the RFS to be successful in driving development of cleaner transportation fuels that measurably reduce carbon emissions.”  

About BIO
BIO is the world's largest trade association representing biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and in more than 30 other nations. BIO members are involved in the research and development of innovative healthcare, agricultural, industrial and environmental biotechnology products. BIO also produces the BIO International Convention, the world’s largest gathering of the biotechnology industry, along with industry-leading investor and partnering meetings held around the world. BIOtechNOW is BIO's blog chronicling “innovations transforming our world” and the BIO Newsletter is the organization’s bi-weekly email newsletter. Subscribe to the BIO Newsletter.

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