Costa, Goodlatte Introduce Legislation to Reform Renewable Fuel Standard

Washington, D.C. – Reps. Jim Costa (D-Calif.) and Bob Goodlatte (R-Va.) introduced legislation today to give relief to livestock producers, dairymen and consumers. The bipartisan legislation will link the amount of corn ethanol required to fulfill the Renewable Fuel Standard (RFS) to the actual U.S. corn supply.

"The Renewable Fuel Standard has been incredibly successful in replacing a portion of the oil we import with home-grown energy, and I continue to support RFS. But our continued reliance on corn-based ethanol has impacts," said Rep. Jim Costa. "While ethanol is not the only factor I am convinced it is a factor in the high prices farmers pay for feed and consumers pay for food."

Since the implementation of the RFS, the percentage of the U.S. corn supply used for ethanol production has continued to climb. An estimated 40 percent of this year's expected corn crop will be sent to the production of ethanol. In 2004/2005, the last crop year prior to implementation of the RFS, only 12.5 percent went to corn ethanol. This will be the first year that the corn supply used for ethanol production will be larger than that used for feed. If left unchecked, this trend could continue to have devastating effects on the bottom line of farmers, ranchers, and consumers.

The Renewable Fuel Flexibility Act, will link the amount of corn-based ethanol mandated under the RFS to U.S. corn supplies. The mandated level will be determined based upon biannual reports from the U.S. Department of Agriculture on the corn stocks-to-use ratios. When the corn supply is tight, the legislation outlines a mechanism that will reduce the level of the corn-based ethanol required in the RFS.

This common-sense legislation deals only with the corn portion of the RFS while continuing to encourage ethanol producers to transition to new generation biofuels made from cellulosic materials that don't double as a food source. The Renewable Fuel Flexibility Act ensures that American agriculture can continue to offer reasonably priced food products to consumers while also encouraging the development of existing and new alternative fuel sources.

"As a longtime supporter of alternative energy, I believe ethanol – particularly cellulosic ethanol – has to be a key part of a balanced energy policy," Costa said. "This legislation will provide a relief valve for the corn-ethanol portion of the RFS to help ensure corn-based ethanol is not leading to corn shortages or even higher prices for farmers and consumers."

A diverse group of agricultural, hunger and industry organizations have endorsed the Renewable Fuel Standard Act including Action Aid, the American Meat Institute, the Grocery Manufacturer Association, the National Cattlemen's Beef Association, the National Chicken Council, the National Pork Producers Council, the National Turkey Federation and Oxfam America. The legislation is supported by California groups including the California Poultry Federation, the California Cattlemen's Association, California Dairies Inc. and California Milk Producers Council.

A summary of the Renewable Fuel Flexibility Act can be found here.