AEA Launches Wind PTC Action Hub

New Initiative Encourages Lawmakers to Eliminate Handouts for Big Wind

WASHINGTON — Today, the American Energy Alliance launched—a resource and activist hub aimed at eliminating the wind Production Tax Credit (PTC). With this new tool, which includes a legislative tracker and an action center, AEA will encourage lawmakers to support efforts to end this taxpayer-funded handout.

One feature of the hub is a video illustrating how the PTC is tied to President Obama’s new carbon dioxide regulation. The goal of this regulation is to shift electricity generation from affordable and dependable sources like coal toward expensive and unreliable sources like wind. Obama’s plan will unavoidably raise electricity rates—hurting poor and middle class families the most. But without the PTC, mandating industrial wind power is a much more difficult task, as wind power needs handouts to survive. Thus, Congress can take meaningful action against the Obama’s administration’s anti-energy agenda by eliminating the PTC. Watch the video below:

The hub’s legislative tracker shows which representatives have publicly taken a stand against the PTC, allowing Americans to thank their elected leaders for opposing this handout, or hold them accountable for supporting wind welfare. Our action center will also serve as a resource for policymakers and activists by providing recent reports, blog posts and ongoing advocacy efforts on the PTC.

Click here to visit the hub.


Let States Manage Their Own Land; Don’t Reauthorize LWCF

A debate in Washington over the reauthorization of the Land & Water Conservation Fund (LWCF) has brought up the often overlooked topic of federal land management. Many Americans may not know just how much land the US government owns. The federal government owns roughly 643 million acres of surface lands, tens of millions acres more of subsurface lands and 1.76 billion acres in the outer continental shelf (OCS) off our coast. The combined roughly 2.46 billion acres is larger, by comparison, than the entire landmass of the United States. Despite these holdings, the LWCF has been a major program for the federal government to continue to buy private lands in the United States.

Created in 1964, the LWCF is a fund that empowers the federal government to purchase private lands to be annexed into growing federal land holdings. This is funded through offshore drilling fees and royalties, which then go into an account that is appropriated to various land programs every year. On October 1, 2015, the LWCF charter expired–and will remain expired unless Congress acts to reauthorize the LWCF.

The question is whether Congress should look to immediately reauthorize this program, or whether this program can stand to have some changes made to it–considering it’s 50 years old. One thing is very clear–there is no emergency facing the program. Currently the LWCF has over $20 billion in unappropriated funds, enough to last at least 60 years if the trend of $300 million in annual appropriations (the minimum amount) continues. Even though the charter has expired, the LWCF can continue to operate on annual appropriations. Thus, claims that the fund is in a crisis are simply untrue. The LWCF should not be reauthorized, at least until serious reforms regarding federal land acquisition are addressed.

At issue is the growing abuse of federal power used to annex state, local, and private land under the auspice of ‘conservation’ or ‘stewardship.’ Between the four major land owning agencies–the BLM, Forest Service, Fish and Wildlife Service, and the National Park Service–the federal government controls 643 million acres of land, roughly 29 percent of all acreage in the US. In a state like Utah, over 60 percent of the land is controlled by the federal government.

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Since the federal government owns so much land that–unlike private lands–produces so little economic enterprise, states and localities are forced to rely on the federal government for revenues, called Payment in Lieu of Taxes (PILT). In 2015, Congress appropriated $405 million for PILT on over 607 million acres of land, the highest it has been in six years, and by a good margin: the next highest total year PILT was $360 million in 2010. A reauthorization of the LWCF could lead to even higher federal spending for PILT in the years to come, and thus greater state dependence on the federal government.

Further, the federal government does a poor job of administering land as opposed to states and localities. For example, over the past 5 fiscal years, oil production is up 89 percent in the U.S. on non-federal lands, while oil production is down 10 percent on federal lands. As explained by the Property and Environment Research Center, “States have clearly demonstrated their ability to generate greater returns from land management than the federal government.” According to their study, from 2009-2013 state lands totaled over $223 million in net revenue, while federal lands lost nearly $2 billion. If we care about land management, a reauthorization of LWCF in its current state is not the best remedy. States must have a greater role in land administration.

At the very least, the LWCF should be reformed prior to any talk of reauthorization being acted upon by Congress. Reform should include measures to give power back to states over lands within their own borders and allowing them to be stewards of their own land. After all, who knows better about the needs of local people and environments than those who live and work closest to them.

Some in Congress want to permanently reauthorize this program, but permanent reauthorization of programs sets a bad precedent. It also seems to indicate that there is something wrong with private land ownership, and that the federal government needs to buy more and more and more private land. Taxpayers are better served if programs are continually reviewed, evaluated, and then reauthorized–with appropriate changes in policy, if deemed prudent. This also forces Congress to prioritize in a way that they rarely do.

The LWCF, initially a bipartisan endeavor, strayed far from its initial goals and now serves as a tool for the federal government to pay for or seize land from states and individuals. States and localities are the best stewards of the beautiful land that we Americans call home, not the federal government. Congress should look to give states greater authority and power over their own lands and should not reauthorize the LWCF without first initiating substantial reforms.

Americans Deserve a Committee Focused on Real Energy Reform

As with any suggestion of a change in the status quo in Washington, my call for the establishment of an Energy & Natural Resources Committee in the U.S. House of Representatives (a position which I have held for over five years) has been met with some reservation. I am happy to continue the dialogue about why this is long overdue and welcome others to join the conversation.

Representative Ed Whitfield recently announced plans to retire from Congress at the end of this term. Whitfield, who chairs the Energy and Commerce Subcommittee on Energy and Power, said one of the issues a future Congress could take on would be to “revisit the Clean Air Act.”

Revisiting the Clean Air Act would be a worthy endeavor. The Obama administration has misused the statute by pursuing the regulation of carbon dioxide to grab more power and exert more control over Americans’ daily lives. Energy policy generally under President Obama has become subservient to carbon dioxide policy through the hijacking of the Clean Air Act by anti-energy groups and their allies in Washington. Just this week, this fact was evidenced by the swift Democratic opposition to the very modest energy bill advanced by Commerce Committee Republicans after a year of “bipartisan” negotiations.

Amending the Clean Air Act currently falls under the jurisdiction of the Energy and Commerce Committee. In fact, the committee wrote the laws that the Obama administration is now abusing. Even the committee’s longest serving former Chairman, John Dingell, never intended the Clean Air Act to control carbon dioxide.

To its credit, the Energy and Commerce Committee has held dozens of hearings on the havoc caused by the Administration’s misuse of the Clean Air Act. Unfortunately, they have never mustered the political will to amend the Act’s language to reflect its original intent.

Instead, they have spent the past year advancing a piece of legislation not designed to take on the Administration’s regulatory onslaught, but rather to garner bipartisan support in the hopes that somehow it will make it to the President’s desk. Now, instead of a bipartisan “Architecture of Abundance” they are advancing a partisan energy bill that fails to accomplish meaningful reform.

The fact that the Energy and Commerce Committee has such vast jurisdiction means that the committee has borne the brunt of Obama’s abuse of executive authority. Given the circumstances, they have done as good of a job as one can expect fighting back. However, the fight against national environmental organizations, which are dedicating millions of dollars lobbying to keep our energy resources in the ground, is too important to be relegated to one of many challenges a committee must tackle.

A House Energy and Natural Resources Committee would be able to focus on building a strong case for updating the Clean Air Act. Doing so would go a long way to creating the long-term, structural changes necessary to promote America’s abundant natural resources, lower energy costs, create jobs, and enhance our energy security.

The House Republicans should use the opportunity of a change in leadership to shift the Energy and Commerce Committee’s energy jurisdiction to the House Committee on Natural Resources, which already has jurisdiction over many energy issues and shares jurisdiction with Commerce in several areas. This would allow the Commerce Committee to devote more attention to its other areas of jurisdiction, including healthcare and telecommunications.

A new House Energy and Natural Resources Committee would focus the House Republican effort on advancing real energy reform. As energy issues rise to the forefront of the policy agenda, the American people deserve a concentrated focus on this crucial set of issues.

Key Vote: Yes on Lifting Oil Export Ban

Congress will soon vote on H.R. 702, a bill to lift the ban on oil exports. The American Energy Alliance supports ending the oil export ban and urges all Members of Congress vote in favor for H.R. 702.

The oil export ban is an outdated and economically damaging policy. The statute is a relic from the 1970s. Technological advances, specifically in hydraulic fracturing and horizontal drilling, have given way to a domestic oil boom. Since 2008, U.S. oil production has increased more than 80 percent and will almost certainly continue to increase. Today, the U.S. is the largest combined oil and natural gas producer in the world. But banning oil exports puts a damper on future domestic oil expansion. This means greater uncertainty and fewer jobs for U.S. oil workers.

One of the biggest concerns about allowing oil exports it that it seems like it could increase gasoline prices here at home. In fact, studies show the opposite would occur because allowing U.S. oil exports would increase the overall supply of oil in the world. The Brookings Institution found a potential 9 cents per gallon drop in gas prices. IHS estimates lifting the ban could lower gas prices by 8 cents per gallon, and an industry study estimates removing the export ban could result in up to $5.8 billion in reduced consumer fuel costs from 2015-2035.

Even though there is substantial evidence supporting an end to the oil exports ban, some lawmakers are attempting to use the issue as a bargaining chip to pass other initiatives. Unfortunately, some of these policies, such as renewing or extending thewind Production Tax Credit and the solar Investment Tax Credit, are harmful for Americans. Studies have demonstrated that wind power is an expensive energy source and undermines the reliability of the electricity grid. Congress should consider the merits of oil exports and realize that removing the ban is positive in and of itself.

The American Energy Alliance urges Congress to vote in favor of H.R. 702 so long as it is not tied to the extension of renewable energy subsidies or partial repeal of the renewable fuel standard. If lifting the oil export ban is considered on its own merits, the American Energy Alliance will include it in our American Energy Scorecard. YES is the pro-consumer, pro-energy, and pro-free market vote.

Rep. Pompeo’s Ratepayer Protection Amendment Promotes Transparency

WASHINGTON — The American Energy Alliance applauds Rep. Mike Pompeo’s Ratepayer Subsidization Protection Amendment, which was adopted today into H.R. 8, the North American Energy Security and Infrastructure Act of 2015. This amendment promotes transparency by requiring utility regulators to study the effects that certain electricity-related subsidies have on ratepayers.

AEA President Thomas Pyle issued the following statement:

“We applaud Rep. Pompeo for recognizing and highlighting the problem of increasing subsidies for electricity. Many of these subsidies, such as net metering, enrich wealthy homeowners at the expense of middle and low-income families.

“As state regulators consider allowing special programs that shift the costs between ratepayers, the general public has a right to know how these programs work, who really pays the bills, and any potential downsides. Transparency should be an important bipartisan issue. As President Obama said, ‘Transparency promotes accountability and provides information for citizens about what their government is doing.’”


It’s Time for a House Energy and Natural Resources Committee

Last week, Speaker of the House John Boehner announced that he would resign at the end of October. As a result, many in Congress are calling for new leadership to implement procedural changes to the House. For example, House Intelligence Committee Chairman Devin Nunes suggested that a new leadership team should implement new conference rules that would make the chamber more functional. And in a letter to House Republican Conference Chair Cathy McMorris Rodgers, Rep. Peter Roskam issued words of caution about the forthcoming leadership elections:

“If we launch headfirst into leadership elections like this is a typical succession, without ever taking the time to diagnose our current ailments, we won’t heal the fractures in a conference that has thus far proved unleadable. In fact, we will find ourselves right back where we are now — stymied by dysfunction and disunity.”

The House should heed these words of advice and start by revisiting the jurisdiction of the House Energy and Commerce Committee. While this committee is one of the most respected and most influential in Congress, it is no longer functional as it relates to the policy priorities of today. This is in large part due to the breadth of its jurisdiction, which includes energy, telecommunications, technology, healthcare, sports related issues, and more. The committee also oversees the Departments of Energy, Health and Human Services, Commerce, and Transportation, as well as the Environmental Protection Agency, the Federal Trade Commission, the Food and Drug Administration, and the Federal Communications Commission.

This laundry list of responsibilities makes it difficult, if not impossible, for the committee to devote sufficient time and resources to one of the most important and growing policy areas—energy. Despite having the word “energy” in its title, the committee has failed to take on our country’s most serious energy challenges.

One need not look further for proof than the committee’s “comprehensive” energy bill, the Architecture of Abundance. The name of this legislation implies that the committee is promoting policies that embrace the use of America’s abundant natural resources—which would lower energy costs, enhance our nation’s energy security, and create jobs. Unfortunately, that’s not the case. While there are some aspects of this bill that embrace the free market and commonsense energy policies, it shrinks from taking on the most meaningful and challenging issues. For example, the bill fails to adequately address the regulatory reform needed to rein in the EPA or find a real solution to the nation’s costly federal ethanol mandate.

This is not necessarily a reflection of Chairman Fred Upton or the other committee members, but rather of the committee’s unwieldy and wide-ranging jurisdiction, which inhibits its ability to focus on these crucial issues. Regardless, it is a wasted opportunity to make significant progress towards more affordable and reliable energy for American families.

Meanwhile, our country faces a relentless and unprecedented level of hostility from the Obama administration towards American energy. Take, for example, oil and gas production, which has lagged on federal lands under this administration’s direction, even as production on non-federal lands has broken records.

Additionally, President Obama is doing his best to live up to his promise to make electricity prices “skyrocket.” His EPA has led a regulatory onslaught on our nation’s energy sources with regulations like the Mercury and Air Toxics Standard, carbon dioxide regulations, and the impending ozone regulation. These policies raise the cost of energy and kill jobs in what is already a fragile economy.

Despite these blatant attacks on American energy, the Commerce Committee has missed numerous opportunities to take meaningful action. For example, energy policy in the United States should be guided by its ability to enhance economic growth and create more opportunities for American families. Instead, it is being driven by the Obama administration’s obsession with regulating carbon dioxide, which EPA is using to grab more and more control over Americans’ lives and energy choices.

The committee wrote the laws that the Supreme Court says give EPA flexibility to regulate carbon dioxide, but even John Dingell, the longtime Democratic Chairman, says the committee never intended that carbon dioxide be controlled under the Clean Air Act. Despite this admission, the committee has not attempted to correct the record by fixing the law, even though there is bipartisan consensus that the Clean Air Act is being misinterpreted. Rather than stepping up to the plate and building a record of support for updating these laws, the committee has merely showcased the harm of Obama’s executive abuse. While worthwhile, it is simply not enough. This type of approach is what has led to increased frustration among American voters.

Fortunately, there is a path forward for the next House leadership to remedy this problem. It begins by shifting jurisdiction over energy policy to the House Committee on Natural Resources, creating a House Energy and Natural Resources Committee. This Natural Resources Committee already has jurisdiction over offshore energy production, coal production, water quality, some natural gas production, and shares jurisdiction on almost every other energy issue with Energy and Commerce. Unlike Energy and Commerce, however, the Natural Resources Committee has a clear and defined focus—how to effectively manage and promote the vast resources of the United States. It does not concern itself with telecommunications policy, or consumer safety, or healthcare.

The focus of an Energy and Natural Resources Committee would be on America’s vast natural resources and the energy that powers our economy. With this more centered approach, the House can begin tackling today’s most pressing energy challenges and push back on the Obama administration’s anti-energy agenda. This change will also lighten the load for a Commerce and Health Committee by allowing it to focus on the other important issues it faces.

The change in House leadership presents a unique opportunity for serious reforms that would make the House run more efficiently and effectively. A new Energy and Natural Resources Committee would be an important step in that direction. Such a committee would provide accountability, and perhaps more importantly, clarity for those who seek to understand and truly reform federal energy policy.

AEA & Coalition Applaud NC Legislature for Taking Action Against Costly Subsidies

Budget Agreement Sunsets Energy Tax Credits; More Work to be Done on REPS

WASHINGTON — The North Carolina legislature recently reached an ​agreement on a budget that phases out tax credits for industrial solar and other forms of more expensive, less reliable energy production. Known as the Renewable Energy Tax Credit, this subsidy harms North Carolina jobs and economic growth. In recent weeks, AEA led a coalition of local leaders and business owners to shine a light on the harmful effects of government subsidies and mandates for expensive energy.

American Energy Alliance President Tom Pyle issued the following statement:

“By striking down taxpayer-funded subsidies for the wind and solar industry, North Carolina lawmakers have taken an important step toward getting the state’s economy back on track. North Carolina’s agriculture and manufacturing sectors rely on affordable energy, and this bill will help lower those costs—leaving North Carolinians with more money in their wallets and enabling local businesses to create more jobs.

“But there is more work to be done. North Carolina’s renewable energy mandate, which forces families and businesses to buy more expensive energy from wind and solar, remains an impediment to the state’s economic growth. I encourage North Carolina’s principled leaders to continue to fight for their citizens by taking steps to repeal this costly mandate.”

North Carolina House Majority Leader Mike Hager said:

“If you really, truly want to see the best for North Carolinians, if you truly want to see the economy boom, then we’ve got to reduce energy prices or hold the line – and that’s why our recent budget eliminated harmful renewable energy tax credits.

“If we’re looking at where the state needs to go, and we look at all the other states, all the countries around the world, and find me a place where we’ve implemented solar energy, wind energy, green energy policies and the price of energy actually went down or is where we are right now – you don’t see it anywhere. That’s why North Carolina needs to freeze our runaway mandates and develop a long-term, low-cost energy plan for the future.”

Bob Luddy, Owner of CaptiveAire Systems in Raleigh, said:

“In many cases, efforts toward sustainability increase capital costs that might otherwise be used for innovation, and efficient manufacturing cannot flourish in states that subsidize inefficiency and punish productive manufacturers.

“As the owner of the largest privately held manufacturer of kitchen ventilation systems in the United States, our cost of doing business is already high enough. I am happy to see the North Carolina General Assembly take a step toward requiring solar and other sources of alternative energy to stand on their own, rather than propping them up with taxpayer dollars. The money manufacturers will save on taxes will allow us to employ more individuals and create more products. It is my hope that North Carolina lawmakers will take further action to address the renewable energy mandate currently spiraling out of control.”

The budget provisions that phase-out tax credits for industrial solar and other forms of less affordable, more expensive energy come shortly after AEA launched a paid media and grassroots initiative targeting North Carolina’s costly Renewable Energy Portfolio Standard, which currently mandates that 12.5 percent of the state’s electricity come from costly renewable energy resources by the year 2021.

As part of its advocacy campaign, AEA, along with a coalition of public officials, policy experts, and members of the business community, convened for a roundtable forum to raise awareness of lawmakers’ responsibility to their constituents in providing affordable, reliable energy.


Clinton Panders to Enviros With Keystone Position

WASHINGTON — American Energy Alliance President Thomas Pyle issued the following statement after Hillary Clinton came out against the Keystone XL Pipeline:

“Hillary Clinton’s statement on the Keystone pipeline gives us a rare window into how she would lead as our nation’s chief executive. It took Hillary six years, eight months, and a struggling presidential campaign to declare what we already knew–that she and her boss were never going to approve this routine infrastructure project that would create jobs, enhance our energy security, and strengthen our diplomatic ties with Canada. First, she dawdled as Secretary of State and now she panders to the national environmental lobby in her quest for the Democratic nomination. Fortunately, it will take much less time for voters to decide whether to put a panderer and dawdler in the Oval Office.”


Congress Should Lift Oil Export Ban; Reject Green Subsidies

As Congress begins to tackle a plethora of legislative issues this fall, one particular issue has garnered broad support on both sides of the aisle: lifting the decades-old ban on oil exports. Representatives across the country have realized that the ban not only inhibits economic growth, but also prevents free trade and does nothing to advance energy security both at home and abroad. Rep. Barton has introduced H.R 702, which would end the ban on oil exports, and other measures are being considered as well. Lifting this outdated law is something Congress can, and should, do.

However, some politicians have floated the idea of using the export ban as a bargaining chip for other legislative prerogatives, such as reviving and extending the wind Production Tax Credit and solar Investment Tax Credit. This should not happen: American energy prosperity and security should not be a part of Congress’ political games. Lifting the oil export ban should be passed as a stand-alone measure, not subject to congressional horse trading.

Lifting the Ban will Benefit Americans

When the current restrictions on oil exports were initially introduced in the 1970s, lawmakers were concerned that the U.S. might run out of oil and natural gas. Over 40 years later, that fear has been disproven, and the U.S. is now experiencing a dramatic boom in oil and natural gas production from shale reserves. What is left is a distortionary federal policy that is holding back further industry development and economic benefits for American families and businesses.

As Institute for Energy Research Senior Economist Dr. Robert Murphy has explained, allowing American producers to export oil is good economic policy that would benefit the country, while keeping the ban in place would harm consumers. Further, as a society that values free trade and open markets, we should allow producers and consumers to trade oil on the global market. As a basic principle, American goods and services should be able to compete with foreign companies, thus benefitting U.S. businesses and lowering prices for consumers. Average Americans don’t purchase oil, but they often buy gasoline. When more oil is put onto the global market, it pushes down prices both for oil and gasoline.

Studies Confirm Benefits

A number of credible analyses have demonstrated the practical benefits of lifting the oil export ban. A study by IHS concluded that a free trade policy toward oil would result in increased average oil production of 1.2 to 2.3 million barrels per day, an average decrease in gas prices by 8 to 12 cents per gallon, and total fuel cost savings of $265 to $418 billion during the 2016–2030 time period.

The Brookings Institution also conducted a report that supports oil exports, estimating that oil production in the Gulf Coast could increase by 1.1 to 1.5 million barrels a day and gas prices could decline by 9 cents per gallon in 2015. They also found that lifting the ban would greatly enhance national energy security and establish the U.S. as a global leader in energy distribution and trade.

The independent U.S. Energy Information Administration recently released an analysis of the impacts of repealing restrictions on oil exports. In their two cases that assume high oil and gas resources, U.S. oil production would rise and gasoline prices would either be unchanged or fall slightly. Various other studies—including reports from ICF InternationalColumbia University, the American Petroleum Institute—have also concluded that removing the ban on oil exports would be beneficial not only for the U.S., but for the global economic community as well.


Even though there is substantial evidence supporting an end to the oil exports ban, some lawmakers are attempting to use the issue as a bargaining chip to pass other initiatives. Unfortunately, some of these policies, such as renewing or extending the wind Production Tax Credit and the solar Investment Tax Credit, are harmful for Americans. Studies have demonstrated that wind power is an expensive energy source and undermines the reliability of the electricity grid. Congress should consider the merits of oil exports and realize that removing the ban is positive in and of itself. Rather than tying passage to harmful subsidies, the ban should be lifted on its own or as part of a legislative package that excludes controversial energy subsidies.

Clinton’s Ethanol Plan Harms Rural America

Last month, presidential candidate Hillary Clinton released her “Plan for a Vibrant Rural America.” Despite Clinton’s claims, her plan will harm rural families. Moreover, by mandating expensive transportation fuels, Clinton’s plan amounts to a national gas tax.

Clinton Flip-Flopped on Ethanol “Gas Tax”

As a Senator, Clinton once adamantly opposed an early version of the Renewable Fuel Standard (RFS), which requires refiners to blend rising amounts of biofuel into gasoline. At the time, she said a renewable fuel mandate would raise gasoline prices at the pump. In a 2002 letter penned with three other senators, she even went as far as to call it “the equivalent of a new gasoline tax.” However, during her 2008 presidential run, Clinton flip-flopped and began supporting ethanol mandates—quite possibly in an attempt to curry favor with Iowans.

Clinton had it right the first time. The RFS functions as a tax on gasoline by mandating the use of expensive fuels, such as cellulosic ethanol. Her so-called “improvements” to the RFS will only make the mandate worse, hitting poor families hardest. Ultimately, it’s Americans that are paying for Clinton’s politically convenient “change of heart.”

Low Carbon, High Cost Fuel Standards

The ethanol portion of Clinton’s “Rural America” plan is summarized on her website:

“Strengthen the Renewable Fuel Standard so that it drives the development of advanced cellulosic and other advanced biofuels, protects consumers, improves access to E15, E85, and biodiesel blends, and provides investment certainty.”

This plan is backwards. The RFS already requires the use of cellulosic ethanol. Congress thought that cellulosic would be cost-effective by now and mandated the use of billions of gallons of it, but reality has proven Congress wrong. Clinton wants to double down on Congress’ inability to predict the future.

For example, in 2010 and 2011 no cellulosic biofuel was produced, despite Congress’s mandate. In 2012, only 20,069 RINs [a RIN is a “Renewable Identification Number” and is equivalent to a gallon of ethanol] cellulosic were produced and in 2013, 422,740 RINs were produced. While that sounds like a lot, it pales in comparison to the 1.75 billion RINs mandated by the RFS. Worse, cellulosic production crashed in 2014 back to 44,168 RINs. For 2015, the RFS calls for the use of 3 billion gallons of cellulosic ethanol, but so far, only 1.6 billion gallons of cellulosic biofuel have been produced and 227,000 gallons of cellulosic diesel.[1]

With cellulosic biofuel, there is a clear history of failure. This is an expensive fuel, but Clinton wants to further require the use of it. This is a recipe for higher fuel prices.

Clinton also extolls the virtues of E15 and E85 (E15 is fuel that is 15 percent ethanol and E85 is fuel that is 85 percent ethanol). The problem is that most cars on the road are not certified by the automakers as being able to safely use E15 and the majority of the time, E85 is more expensive (on an energy equivalent basis) compared to regular gasoline. Sometimes, E85 makes economic sense to use in a flex-fuel vehicle, but not all of the time. It is simple economics—if there was demand for E85, the federal government would not need to subsidize it as Clinton wants.

By favoring costly, non-existent cellulosic biofuels over corn-based ethanol, Clinton’s fuel mandate would resemble California’s Low Carbon Fuel Standard (LCFS). This would impose enormous costs on American motorists. As AEA previously explained:

Not only is an LCFS another inefficient and political mandate, but it is costly as well. According to a study by Boston Consulting Group on California’s LCFS, the program could increase the price of gasoline by more than $2.50 a gallon. SAIC looked at a possible Northeast/Mid-Atlantic LCFS and found that it would cost 147,000 jobs and reduce GDP by $27 billion. Moving from an RFS to an LCFS means that American motorists will pay more for fuel and suffer job losses and slower economic growth.[2]

Clinton’s Plan Would Hurt Rural Americans

Ironically, Clinton’s proposal could actually hurt many rural farmers by shifting the mandate from corn-based ethanol to advanced biofuels that aren’t derived from corn. Essentially, Clinton’s plan will disadvantage corn farmers and raise gasoline prices across the board, hitting rural Americans the hardest, especially those who log the most miles in their vehicles. In a way, this option is the worst of both worlds. Not only will it increase fuel prices, but her plan will hurt many of the “rural Americans” she claims to help.

Clinton’s proposal is similar to efforts in Congress aimed at repealing the corn-portion of the RFS. As discussed above, this would establish a LCFS that props up expensive, non-existent biofuels at the expense of corn farmers while burdening all Americans with gas prices that look like California’s—among the highest in the nation. This is why Congress should reject current partial-repeal proposals and eliminate the RFS entirely.


Clinton’s plan is framed as a boon to rural America, but one of its key facets—a modification to the RFS—will harm many rural families. Before she flip-flopped to pander to voters, Clinton was right to label renewable fuel mandates as a gas tax.

The economic realities are still the same. Mandating ethanol and advanced biofuels will lead to higher gasoline prices for motorists. In addition, the Clinton plan will turn the RFS into a California-style Low Carbon Fuel Standard, resulting in even more economic harm. In the end, the RFS is broken beyond repair and Clinton’s plan will only make it worse. Only a full repeal of the law will truly improve the lives of all Americans.

[1] See EPA, 2015 RFS2 Data, Note, last year EPA changed the definition of cellulosic biofuel to include renewable CNG and renewable LNG as cellulosic biofuel. We are not counting those volumes in this because this isn’t the fuel Congress contemplated when it created the updated the RFS.

[2] Daniel Simmons, “Why Congress Should Fully Repeal the RFS,” American Energy Alliance, May 27, 2015,