By Jarrett Renshaw
(Reuters) - Republican U.S. Senator Mike Lee of Utah is trying to rally colleagues to sign a letter opposing the Biden administration’s plan to include electric vehicles in the nation’s renewable fuel program, arguing the proposal is an assault on the internal combustion engine, Reuters has learned.
The effort represents the latest attempt by a federal lawmaker from a refining state to oppose policy measures that could undermine fossil fuel demand.
But it is getting pushback from the biofuels industry, which has chosen to align itself with the electric vehicle (EV) industry as fighters of climate change, rather than with the refining industry in defense of liquid fuels. At issue is a proposal from the Biden administration that would for the first time allow EV manufacturers to tap into a multibillion-dollar market for tradable renewable fuels credits under the Renewable Fuel Standard (RFS). EV makers, such as Tesla (NASDAQ:TSLA) Inc, would be able to generate the credits, known as RINs, and sell them to refiners, if they can prove that the cars and trucks they make are being powered by electricity from plants that burn biofuels. Under the RFS, refiners are required to blend growing volumes of biofuels into the fuel pool or buy an equivalent number of credits. It has been an economic boom for corn growers and Midwestern states that support ethanol production, but small refiners argue its compliance costs threaten their existence and thousands of good-paying union jobs. In the proposed letter being circulated by Lee, he says the so-called E-RIN proposal to include electric vehicles represents an overreach for a program designed for liquid fuels, and lacks any realistic attempt to prove that electricity generated by biogas such as methane is actually powering a car. He called it an "attempt by the Biden Administration to prop up the market for EVs with the intent of destroying demand for the internal combustion engine and giving consumers no choice but to drive EVs," according to the letter seen by Reuters. One of the letter's authors, according to data embedded in the document, is a lobbyist at HollyFrontier Corp, which has a refinery in Utah.
Lee has "long committed himself to pushing back against the onerous and oppressive rules and regulations handed down by the executive branch," said Lee Lonsberry, a spokesperson for Lee. Lonsberry said the draft letter is a result of consulting multiple industry partners impacted by these rules.
HollyFrontier did not respond to a request for comment.
An email being circulated by a group of biofuel advocates to congressional staff urged lawmakers not to sign the letter, pointing out that the industry supports Biden's plan to include EVs in the Renewable Fuel Standard even though it sees some problems with its details.