Biden’s Climate Model Adjustment to Impact Ethanol Producers
White House Set to Back Tougher Climate Model for Ethanol
President Joe Biden’s administration is poised to announce an adjustment to its scientific modeling for ethanol that will show the corn-based fuel to be less effective at reducing greenhouse gas emissions than previously estimated, according to three sources briefed on the plans.
Implications for Ethanol Producers and Sustainable Aviation Fuel
The adjustment will make it more difficult for ethanol producers to take part in lucrative new U.S. tax credits for sustainable aviation fuel, seen as crucial to the industry’s growth. However, it will still leave them a pathway to the subsidies if they can partner with corn growers that use sustainable farming practices.
Focus on Environmental Damage and Climate-Smart Farming Techniques
The adjustment is intended to more accurately account for the environmental damage caused when land is converted into farms to grow corn, while also rewarding climate-smart farming techniques like no-till farming and covered crops.
Political Implications and Industry Challenges
The plan would be a middle ground for the White House, facing pressure from environmentalists and an ethanol industry looking to the skies for financial survival as electric vehicles threaten to kick them off roads.
Impact on Sustainable Aviation Fuel and Climate Goals
Biden’s signature climate bill included a tax credit for producers of sustainable aviation fuel, with the administration aiming to supply at least 3 billion gallons of SAF per year by 2030 as part of its broader effort to decarbonize the transport sector.
Lobbying and Adjustments
The Biden administration backed a climate model favored by the ethanol industry in December, but they promised to revamp it and release the details in March, sparking intense lobbying push by industry and environmentalists over how to quantify things like environmental damage and climate-smart agriculture.
