As rationale for amending the Renewable Fuel Standard – several members of the House Energy and Power Subcommittee advanced the notion that times have changed since the passage of the RFS in 2007. They suggested the U.S. no longer has a foreign oil dependence problem. But Advanced Ethanol Council Executive Director Brooke Coleman says the idea we have somehow kicked our addiction to foreign oil is not based on fact. While last year’s 14-percent increase in domestic oil production is good for energy security – Coleman says it’s a drop in the bucket when it comes to foreign oil dependence. She notes the nation is again on pace to spend more than 400-billion dollars on foreign oil in 2013 and imports from the Persian Gulf and Saudi Arabia were up in 2012. Coleman says times will change when we introduce competition for the oil industry – which is what the RFS is doing.
The AEC also points to the fact that current trends are not predicted to continue in the long term. Coleman says tight oil reserves in places like the Bakken aren’t robust enough to fundamentally change our situation. According to the U.S. Geological Survey – the estimated 4.3-billion barrels of recoverable tight oil from the Bakken is less than one year’s worth of crude oil consumption by U.S. refineries. Coleman says that’s why foreign oil dependence is expected to start increasing again within three to five years.
Growth Energy Notes Testimony of USDA Chief Economist on RFS
USDA Chief Economist Joe Glauber testified before the House Energy Subcommittee on Energy and Power Wednesday. The subcommittee was examining aspects of the Renewable Fuel Standard. According to Growth Energy CEO Tom Buis – Glauber’s testimony validated what the biofuels industry has said since the RFS was enacted – the production of biofuels doesn’t have any substantive correlation with the rising cost of food prices. If the committee is truly interested in the culprits behind rising food prices – Buis says they should look no further than oil companies. He notes the subcommittee hearing came on the heels of a recent World Bank study outlining how crude oil prices are responsible for 50-percent of the increase in food prices since 2004.
Source: NAFB news service