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Welch-Udall GREENER Fuels Act (H.R. 5212/S. 2519)

Section-by-Section

Section 3: LIMITATION OF FUELS DERVIED FROM CORN KERNELS

• This section would prohibit any part of a corn kernel from qualifying as an advanced biofuel.
o Corn kernels have 3 parts –starch, protein, and oil. Corn ethanol is made from starch,
but there has been increasing production of fuels made from other parts of the kernel.
o Production of these fuels continues to drive more corn development and have the same
environmental concerns as corn ethanol. This section is intended to limit corn
production.

Section 4. RENEWABLE BIOMASS

• Section 4(a) would prevent invasive species from qualifying as renewable biomass.
o Some invasive species characteristics can make them attractive as a biofuel feedstock.
For instance, they can grow in marginal soil, without much water, can outcompete other
crops for resources, etc. The concern is that if we allow invasives to be developed as
biofuel, they could spread to unintended areas. An example of this would be Arundo
donax (giant reed), which was approved as a cellulosic pathway despite being listed by
USDA as invasive and causing problems throughout the southern half of the United
States.
o Note: The invasive prohibition language in Section 4(a) is copied from the Biomass Crop
Assistance Program statutory language (7 U.S.C. 8111).
• Section 4(b)(1) would require domestic biofuel producers to meet the same, more stringent
environmental reporting requirements currently required of foreign biofuel producers and
domestic wood biomass producers.
o The CFR reference specifies the current reporting requirements for foreign biofuel and
domestic wood biomass producers. For instance, there’s an online tracking system that
Argentinian soy producers have to use in order to generate a RIN, producers must have
records showing the land wasn’t brought into production after the 2007 RFS was
passed, etc. In contrast, most other domestic biofuel producers don’t have to meet
these requirements. The goal of this section is to require all domestic biofuels to meet
this more rigorous standard.
• Section 4(b)(2) would require EPA and USDA to issue an annual report on how much virgin land
has been brought into agricultural production, how much corn and soy is being planted, etc.
USDA reports the number on a national aggregate basis, making it difficult to determine how
much new land is being devoted to corn and soy production.

Section 5: STRENGTHENING ENVIRONMENTAL STANDARDS

• Section 5(a) would end an exemption that permits legacy ethanol refiners to circumvent the
GHG reduction standard.
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o The RFS requires corn ethanol to burn 20% cleaner than gasoline. However, EPA
grandfathered in 40% of ethanol plants at the time the RFS was passed, meaning a
significant portion of the RFS isn’t meeting the intended GHG reduction standard. In
fact, 14.8 billion gallons of corn ethanol were exempted from meeting the emissions
reduction target. This section would end the grandfather clause beginning in 2020.
• Section 5(b) would eliminate the ability of EPA to waive the existing GHG reduction
requirements for the different types of biofuels (20% GHG reduction for corn ethanol, 50% for
advanced biofuel/biomass-based diesel, and 60% for cellulosic).

Section 6: APPLICABLE VOLUMES; SUNSET

• This bill modifies the applicable biofuel volumes and specifies timing for the sunset of the 4
biofuel categories: conventional ethanol, biomass-based diesel, cellulosic advanced and non-
cellulosic advanced.
o Conventional corn ethanol: beginning in 2023, this bill would reduce the corn ethanol
mandate from its current level of 15 billion gallons by 2 billion gallons each year until it
is fully eliminated in 2030.
o Cellulosic advanced: the mandate would be extended until 2 billion gallons of annual
cellulosic production is achieved or calendar year 2037 (whichever comes first). Then
cellulosic mandate would sunset.
o Non-cellulosic advanced: the mandate would be capped at 2 billion gallons and sunset in
2030.
o Biomass based-diesel: the mandate would be capped at 2 billion gallons (no more than 1
billion gallons can be used from pure vegetable oil) and sunset in 2030.
§ Section 6(B)(iii) would limit the use of virgin vegetable oils in the RFS.
Specifically, it would restrict to 1B gallons the amount of biomass-based diesel
allowed to be produced from virgin vegetable oils and generate a RIN. This
provision seeks to limit the damage unchecked soy and palm development are
having on the environment.
• This bill would modify how and when the RVO is set for cellulosic advanced, non-cellulosic
advanced and biomass-based diesel.
o The RVO would be set on the previous year’s renewable fuel production volumes with a
mid-year adjustment to account for new production facilities or the expansion of
currently facilities.
o How will EPA calculate what the previous year’s production level was? By moving the
date that the RVOs are set from November 30th to March 1st. This allows EPA to simply
take the renewable fuel production volumes from the previous year (which are currently
published in the second week of February on EPA’s Moderated Transaction System
(EMTS), and use them to set the following year’s RVOs without any forecasting or
estimation.
o Additionally, the bill would require a mid-year adjustment to the RVOs. On Sept 1 of that
year, EPA would need to update the RVOs to reflect any new production that has come
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online. If production has increased, the RVO requirement would need to increase
accordingly.

Section 7: ALLEVIATING ETHANOL BLEND WALL

• This section would cap ethanol at 9.7% of the fuel supply, ensuring we remain below the blend
wall while preserving a small market for E0 gasoline.
• This section would also require EPA to prioritize the use of cellulosic biofuel ahead of other
biofuels when determining volumes below blend wall levels.

Section 8: CELLULOSIC BIOFUEL CREDITS

• This section clarifies that cellulosic biofuel credits may be carried forward to the following year,
and that cellulosic volumes generated in excess of the mandate will still generate RINS.

Section 9: WAIVERS

• This section alters EPA’s existing waiver authority, eliminates waivers for cellulosic and biomass-
based diesel, and eliminates the reset authority.
o Currently, EPA has the authority to waive down volume mandates if implementation
“would severely harm the economy or environment of a State, a region, or the United
States”.
o The problem is, even during periods such as the 2012 drought when the RFS
exacerbated corn shortages, EPA has been unwilling to utilize this waiver. This seems to
stem in part from a view that the RFS hasn’t been the sole reason for economic or
environmental harm.
• This section alters this waiver authority to state that if the U.S. is experiencing severe economic
or environmental harm, and the implementation of the RFS is either the root cause of the harm
or is significantly contributing to it, EPA should be required to grant a waiver petition—provided
that waiving the RFS would appreciably alleviate the harm.
• This section would also eliminate existing waivers or cellulosic, biomass-based diesel, and EPA
reset authority. Since mandate volumes will now be based on existing, proven production, these
waivers will no longer be necessary.

Section 10: LAND TENURE

• This section would require EPA to consider the impacts that a new biofuel pathway may have on
land grabs. It would also require a joint USDA-EPA-USAID report examining the impacts the RFS
is having on farm-ownership consolidation and global land acquisition.
o Increased demand for land-intensive biofuel production can drive land grabs in
developing countries, which results in smallholder farmers being force off their land.
Biofuels developed on agricultural land can create a demand for large-scale mono-crop
production, further increasing land pressures.
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o Increased biofuel demand has led to increased crop production in developing countries
like Guatemala. That increased production has led to large companies booting
indigenous groups and others off their land, claiming their water, etc. This is meant to
fully consider those types of risks.

Section 11: COMPREHENSIVE ASSESSMENT OF IMPLICATIONS ON USE OF MID-LEVEL ETHANOL

BLENDS

• This section would require a study of the impacts ethanol blends greater than E10 could have on
infrastructure, the environment, emissions etc.
• It would also put a moratorium on EPA’s ability to issue any new waivers allowing E15 until the
study is completed.

Section 12: PRIVATE LAND PROTECTION AND RESTORATION FUND

• This would create a new 10 cent per RIN fee, assessed on obligated parties.
o The proceeds of the fee would be available to the Department of Interior to fund
existing programs that help private landowners conserve land and habitat in areas most
impacted by the conversion of habitat to corn and soy production.
o None of these funds can be used for land acquisition.