Government

Iowa renewable energy farmers say Trump's 'political future' hinges on biofuels deal

Three biofuel plants in Iowa now shuttered because of bad market conditions

President Donald Trump reacts to crowd before speaking during a June 11 visit to the Southwest Iowa Renewable Energy in Council Bluffs. The plant served as a backdrop for his announcement that his administration would allow year-round sales of E15, a fuel with a higher percentage of ethanol. (Kevin Lamarque/Reuters)
President Donald Trump reacts to crowd before speaking during a June 11 visit to the Southwest Iowa Renewable Energy in Council Bluffs. The plant served as a backdrop for his announcement that his administration would allow year-round sales of E15, a fuel with a higher percentage of ethanol. (Kevin Lamarque/Reuters)

The Trump administration faced swift backlash from farmers and biofuel industry leaders in August after federal officials exempted 31 oil refineries from following the nation’s renewable fuel requirements.

Now, several Iowa-based farmers are waiting with bated breath to see how the president and U.S. Environmental Protection Agency will proceed on a biofuels package they say could help make up for 4 billion gallons of biofuel demand wiped out over the past three years.

“There’s no reason the announcement can’t be made in the next two weeks or less,” said Kelly Nieuwenhuis, a farmer in northwest Iowa’s Primghar and board president at Siouxland Energy Cooperative, during a media call Thursday morning.

Nieuwenhuis shut down his ethanol plant in Sioux Center earlier this month, the second in Iowa following Plymouth Energy’s announcement in July it would close its plant in Merrill, also in northwest Iowa.

More recently, on Tuesday, W2 Fuels said because of poor market conditions it was closing biodiesel plants in Washington County’s Crawfordsville and in Adrian, Mich., resulting in 50 total layoffs.

The EPA more than quadrupled its previous number of small-refinery exemptions granted to oil refiners, including to companies like Exxon Mobil and Chevron, with 85 waivers issued since President Donald Trump took office.

These exempt the refiners from requirements to mix renewable energy source like corn-based ethanol or soybean-based biodiesel with their gasoline, or buy credits.

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Nieuwenhuis said he believes Trump’s “political future” hangs in the balance of a deal to increase biofuels demand.

“We realize that it’s EPA, but he (Trump) is the one they answer to. And when he made that call to grant those last 31 small-refinery exemptions, you can’t believe how many upset farmers I was with that day that said they were done voting for President Trump,” he said. “That was the final straw and that message is getting out there pretty strongly.”

Daryl Haack, also of Primghar and a board member of the Little Sioux Corn Processors ethanol plant, agreed, saying that, to a man, his board all voted for Trump three years ago and, as of a month ago, “they probably weren’t going to do that.”

Haack said his plant hasn’t shut down yet but “it will get tougher” if the biofuels demand continues decreasing.

He also indicated that, with the recent ethanol plant shutdowns, Iowa farmers will be “scrambling” to find other locations to deliver corn harvested this fall.

“That’s corn that won’t just be disappearing,” Haack said. “It’s going to create a huge problem for farmers in our area.”

Trump on Aug. 9 gave EPA Administrator Andrew Wheeler the green light to grant the 31 waivers, with the agency granting full, rather than partial, waivers to some oil refiners despite Department of Energy recommendations, according to Reuters reports.

Since then, several weeks ago, prominent Iowa Republicans who had spoken out against the waivers, including Gov. Kim Reynolds and U.S. Sens. Chuck Grassley and Joni Ernst, met with Trump and discussed details of what he promised via tweet would be a “giant” ethanol package.

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Though the key parties appeared close to a deal, two unnamed industry sources told Reuters the package seemed to have stalled, and could remain indefinitely on hold, due to the impeachment inquiry against Trump — “it seems his interest has waned,” one said.

Ron Heck, a soybean farmer in Perry in central Iowa and secretary of the National Biodiesel Board, said he believes the EPA “misled” Trump in advising the waivers would not affect demand for renewable fuels.

Wheeler’s comments echoing that sentiment to a congressional committee last week were “so off base and so out of line,” Heck said.

Now, he said, “the president will be held accountable for whether he has benefited from better and more accurate information or not.”

Comments: (319) 398-8366; thomas.friestad@thegazette.com

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