Today's hearing will address the environmental benefits and impacts of ethanol under the Clean Air Act. This Subcommittee addressed MTBE last fall, the other principle oxygenate, so today we will turn our attention to ethanol.
In 1990, Congress made a mistake by mandating oxygenates in gasoline. We ended up creating a water quality issue because of the use of MTBE. I think it is important to note that three years before Congress acted, scientists at EPA identified the potential problem, although the Agency failed to notify Congress during the debate in 1990.
Today, Congress is being asked to do the same thing, create a new mandate. I hope Congress has learned from the mistake, because the EPA certainly has not learned from their mistake. I say this because last week the Administration issued a report called "Analysis of Policy Scenarios for Reducing or Eliminating MTBE" This report clearly shows that the Administration would rather play games and pander to constituent groups than enter into a serious policy discussion about a real environmental problem.
This report comes nine months after the Blue Ribbon Panel recommendations and three months after the Administration announced their legislative principles. This Report is in response to questions we asked the day the principles were released. This is simple background information that the Administration should have considered before issuing their principles. Because of their delays, I think it will be very difficult to enact legislation on this issue this late in the year. Particularly since instead of a rifle-shot approach to addressing a real environmental issue, the Administration is advocating what is essentially a broad-based rewriting of the fuels section of the Clean Air Act. I believe if we rewrite Title 2 is should be next year during reauthorization, this year we should just concentrate on fixing the MTBE issue.
While I will not go into detail about all of the problems with the report today, I will just list a few key concerns.
1. They cherry pick from the recommendations of their own Blue Ribbon Panel, implying that they have followed the recommendations. [Show Chart] I pulled out two additional recommendations that they ignored regarding the need for additional research on ethanol before its use is expanded. All together the panel recommended 14 steps. The administration is only following three.
2. When discussing benefits, they only discuss the benefits of RFG, not the benefits of oxygenates. The benefits of RFG are not an issue, but the benefits of oxygenates, in particular ethanol are clearly an issue.
3. They do not discuss any of the environmental problems associated with ethanol, such as the effect on benzene, the increased emissions of NOx, the increased emissions levels of aldehydes, and potential health problems associated with ethanol.
4. They call their approach cost-effective even though they admit that the costs will almost double, and their costs are extremely conservative. When a product is mandated, creating a monopoly, the prices do not remain constant, they rise, which is what will happen to the price of ethanol.
5. Most importantly, they ignore every independent scientist who has looked at the use of ethanol and has called for more tests and studies before it is mandated. Specifically the EPA's own Blue Ribbon Panel recommendations and the Report to the California Environmental Policy Council last December, which was a comprehensive health and environmental assessment of ethanol. Both reports called for more studies on ethanol.
On a final note, over the last few days the EPA has started blaming the oil companies for the high cost of gasoline, particularly the RFG phase 2 in the Midwest, which uses ethanol. This is like the story of the small child that doesn't regret eating the whole cake, but is awfully upset that he has a stomachache. The EPA is not taking responsibility for its actions. The EPA has forced numerous controls and mandates on gasoline formulas, and it is proposing another one, ethanol, yet it wants to deny the real outcome of its policies to the consumers, higher fuel prices. We will be looking at the price of fuel issue more tomorrow when the EPA testifies during our Hearing on the Sulfur Diesel regulations.