Republican presidential hopeful Cruz claims his plan would expand ethanol demand

CEDAR RAPIDS - Texas Sen. Ted Cruz defended his energy plan that would terminate federal support for ethanol production, claiming that ending subsidies for all forms of energy would expand the market - and demand - for the corn-based fuel that is credited with supporting somewhere between 47,000 and 75,000 jobs in Iowa.

'You shouldn't have government picking winners and losers,” Cruz said in Cedar Rapids Saturday afternoon, explaining that he would eliminate every energy subsidy 'across the board … and lets energy producers compete on an open playing field.” Ethanol, he added, is a 'mature product for which there is significant demand.”

Cruz, who was one of five GOP presidential hopefuls at the first Rising Tide Summit hosted by FreedomWorks, a free market advocacy group, and 1st District Rep. Rod Blum. Cruz was joined by retired neurosurgeon Ben Carson, former CEO Carly Fiorina, Kentucky Sen. Rand Paul and former Pennsylvania Sen. Rick Santorum. Cruz and Carson, both who have come under fire by America's Renewable Future for their positions on the Renewable Fuel Standard (RFS) that sets guidelines for use of renewable fuels including ethanol, received the loudest cheers when the candidates were announced.

'One doesn't need to be a brain surgeon to see that his reversal of positions is a capitulation to the oil industry,” ARF said about the retired neurosurgeon.

Ethanol and the RFS have become issues in the Iowa caucus campaign in the wake of the EPA decision to reduce the RFS, which determines how much biofuel will be produced and blended with traditional gasoline. The original targets set by Congress in 2005 and expanded and updated as part of the 2007 Energy Independence and Security Act called for a total of 22.25 billion gallons of biofuels to be produced and distributed in 2016. The EPA reduced that to 18.11 billion gallons and reduced the portion of that that would be ethanol from 15 billion gallons to 14.5 billion gallons.

Under his plan, Cruz said the marketplace will decide which forms of energy rise, 'but we will not have the federal government putting artificial barriers in place and engaging in the cronyism of Washington picking winners and losers.”

Earlier this year Cruz indicated that he would speed up that timeline for phasing out the RFS.

That would 'decimate Iowa farmers and risk 73,000 Iowa jobs, according to American Renewable Future Co-Chair and farmer Annette Sweeney, a former state lawmaker.

Not only would ethanol survive without the RFS, ethanol can and will grow, Cruz said. There is a market demand for ethanol, which he explained adds octane to gasoline in an environmentally responsible manner.

The barrier to ethanol expanding is the federal government in the form of EPA blending wall limits, Cruz said.

'If we remove those barriers, ethanol will have a larger market share than it does today,” he said. 'As president, I am committed to removing those barriers.”

However, Sweeney pointed out that the subsidies for biofuels like ethanol ended in 2011 while the oil industry receives subsidies costing American taxpayers $20.5 billion annually, according to a report from Oil Change International. What's more, she said, Cruz has close to $1 personally invested in oil companies, which is roughly equivalent to the over $1 million-plus in campaign contributions he has received from the oil industry, according the association.

Earlier this year, Carson opposed subsidies because they interfere with the free market. Then he said he would take oil subsidies and put them toward ethanol processing. However, later in a debate, he said he opposes regulations, like the RFS, because 'every single regulation costs in terms of goods and services. That cost gets passed onto the people.”