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Trump promises giant package related to ethanol to please farmers

Kamis, 29 Agustus 2019 / 21:30 WIB
Trump promises giant package related to ethanol to please farmers
ILUSTRASI. Presiden AS Donald Trump

Sumber: Reuters | Editor: Wahyu T.Rahmawati

KONTAN.CO.ID - WASHINGTON. President Donald Trump said on Thursday his administration is planning a "giant package" related to ethanol that would please U.S. farmers angry over the government's expanded approval of waivers freeing oil refiners from obligations to use the corn-based fuel.

The announcement reflects Trump's challenges pleasing both the corn and oil industries, two key political constituencies ahead of next year's presidential election that have repeatedly clashed over U.S. biofuel policies.

"The Farmers are going to be so happy when they see what we are doing for Ethanol, not even including the E-15, year around, which is already done," Trump said on Twitter. "It will be a giant package, get ready! At the same time I was able to save the small refineries from certain closing. Great for all!"

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Trump did not offer details on what the "giant package" would entail. The E15 mentioned by Trump is a higher-ethanol blend of gasoline.

The U.S. Renewable Fuel Standard requires refiners to blend biofuels like ethanol into their fuel, but allows the U.S. Environmental Protection Agency to grant small facilities in financial turmoil waivers freeing them from the obligation.

The EPA announced this month a decision to grant 31 biofuel waivers to refineries facing financial hardship, a level that the corn lobby said was excessive and would significantly undermine demand for ethanol and other biofuels.

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Trump last week directed Agriculture Secretary Sonny Perdue, EPA chief Andrew Wheeler and a few White House advisers to come up with a solution that would boost biofuel demand in the wake of the EPA waiver decision. Among the proposals circulated was to ramp up biofuel blending quotas slightly, but there has been disagreement over when to apply the increase, sources said.

Perdue said on Wednesday that he also proposed strengthening U.S. infrastructure to allow more widespread use of E15. The Trump administration in June lifted a summertime ban on E15 use that had been imposed by the administration of Democratic former President Barack Obama to combat smog.

The oil industry, which dislikes the biofuel mandates because they cut into its market share, has said it would oppose any efforts to further bolster the ethanol industry.