NPRA’s Drevna Warns of Unintended Consequences of Massive Biofuels Boost

NPRA, the National Petrochemical & Refiners Association, Executive Vice President Charles T. Drevna today testified before the Senate Subcommittee on Energy expressing the association’s concerns with proposals to expand the national biofuels mandate despite a deficient distribution system and increased costs.

“While ethanol is a valuable blendstock for gasoline and its use will undoubtedly continue to grow even without mandates, ethanol also carries a number of disadvantages, including a lower energy content and potential problems with ozone formation,” Drevna told subcommittee members. “Creating artificial demand for biofuels also places unwarranted strain on other industries that compete for the same feedstocks, thus impacting food and other commodity prices. Projected ethanol demand is likely to further exacerbate the problem and create food and other commodity price increases across the economic spectrum.”

Drevna also offered several recommendations in moving forward.

“First, all commercially available biofuels, regardless of feedstock, process, point of production or blending, or specific technology, should be treated equally when considering specifications, incentives or other requirements. Second, the Congressional Budget Office should conduct comprehensive economic and environmental impact analyses on the expansion of renewables. Congress should consider energy security, public health and the environment, transportation, infrastructure, job impacts, and impacts on overall economic development. Third, Congress should preempt state and local biofuels mandates. NPRA believes that new state biofuels mandates should be subject to EPA or DOE examination for their impact on air quality, fuel production and distribution. Fourth, Congress should further review and consider the five core strategies recommended in the recent National Petroleum Council report, which I have highlighted in my written statement. Fifth, prioritize the development and production of the nation’s supply of oil, oil products and natural gas to help meet increasing demand. And finally, resist tinkering with market forces, including imposition of ‘windfall profits’ taxes, LIFO repeal, elimination of domestic production and foreign tax provisions, or ‘price gouging’ legislation. These measures, if enacted, would only serve to further the nation’s dependence on foreign supplies of energy, not limit them.”

NPRA members include more than 450 companies, including virtually all US refiners and petrochemical manufacturers. Our members supply consumers with a wide variety of products and services used daily in their homes and businesses. These products include gasoline, diesel fuel, home heating oil, jet fuel, lubricants and the chemicals that serve as “building blocks” in making everything from plastics to clothing to medicine to computers.