The Cost of Mandates

Since the inception of the ethanol mandate a decade
ago, the United States has undergone an energy
transformation from a nation of energy dependence
and scarcity to one of energy security and abundance.
America has significantly increased domestic crude
oil production and transitioned from a net importer of
refined petroleum products to a net exporter. It is well
past time to reform outdated energy policies to reflect
the energy realities of today and tomorrow.

Today, most gasoline contains 10 percent ethanol by
volume. However, if the Renewable Fuel Standard
(RFS) requirements continue to be implemented,
our nation could exceed this level of ethanol in the
fuel mix. Extensive testing by the automotive and oil
industries shows higher ethanol blends may result
in damaged engines and fuel systems for owners of
the overwhelming majority of cars. Automakers have
warned these increased blends of ethanol could void
car warranties. Increased RFS volumes could also cost
consumers money and choice, and threaten far higher
costs in the form of engine damage.

Furthermore, as stated by the EPA “Biofuels also tend
to require subsidies and other market interventions to
compete economically with fossil fuels, which creates
deadweight losses in the economy.”

Simply stated, the RFS mandate creates potential harm
to the American consumer. And it must be fixed. Surveys
show that the American people agree, with nearly threequarters
of voters concerned about the potential harms
created by the increasing prevalence of ethanol blends
to over 10 percent of the fuel mix. The RFS has proven
to be an unworkable program.

Congress must repeal or significantly reform the
Renewable Fuel Standard to protect American
consumers.