EPA’s Extreme Prohibitionist Arrogance
|September 15, 2013||Posted by Fred Foldvary under Editorials|
A big problem in mass democracy is that Congress creates an agency, gives it broad and deep power, and then lets it run amuck. That’s what’s happening to the Environmental Protection Agency. Rather than protecting the environment, the EPA chiefs indulge in imposing their might on industries, inflicting needless costs that destroy enterprise and jobs without protecting the natural environment.
During the current administration, the EPA has issued 1920 new regulations, while it decreased transparancy. The EPA chiefs are accused of using text messages and non-EPA email addresses to hide EPA business from the public and Congress.
A prime example of the EPA’s extreme prohibitionist arrogance is its implementation of RFS. According to the EPA web site, EPA is responsible for Renewable Fuel Standard (RFS) program regulations to ensure that transportation fuel sold in the United States contains a minimum volume of renewable fuel. The RFS program was created under the Energy Policy Act of 2005, which established a renewable fuel volume mandate in the United States. As required under the EPAct, the RFS program requires renewable fuel to be blended into gasoline.
One of the problems with this regulation is that, as explained by “Smarter Fuel Future,” the EPA is requiring oil companies to add cellulosic biofuels, even though there is no commercial production of the product. Cellulosic biofuel is made from grass, wood, and other plant parts. Refiners are being forced to buy credits for a product that is not available in the USA. In effect, the biofuels mandate has been turned into an extra tax on fuel that is passed on to consumers.
The biofuel mandates have also been plagued by fraud. Biodiesel is available for commercial purchase, but many refiners instead purchase Renewable Identification Numbers, fuel credits they buy from biofuels companies. Many biodiesel companies are selling fraudulent credits. Even worse, if RINs are found to be fake, refiners must pay a fee as punishment and purchase more RINs. The biofuels program was begun under President Bush, who proposed a mandate for 35 billion US gallons of ethanol by 2017. In 2007, the Energy Independence and Security Act (EISA) established annually increasing renewable fuel volume targets.
In 2012 The American Petroleum Institute filed a lawsuit with the D.C. Circuit Court challenging the Environmental Protection Agency’s unachievable requirements for use of cellulosic biofuels in the 2012 Renewable Fuel Standard. In response to the industry’s objections, the EPA claims that commercial-scale cellulosic biofuels facilities will be operating in the future. An appeals court upheld the lawsuit, but the EPA is levying fines anyway.
Another EPA mandate is E15, gasoline that is 15 percent ethanol. The blend damages some engines and voids the warranties. The EPA does not absolutely require gas stations to use blended ethanol, but it constricts the supply of unblended gas by forcing refiners to buy “blending credits” based on the quantity of ethanol they blend in. To meet the quotas, refiners will have to sell at least some E15 to gas stations.
E15 damages car parts made of rubber, plastic, metal, and other materials in engines not specially sealed to allow the use of higher ethanol blends. Some automakers make vehicles safe for E15 use, but many don’t. Chrysler, Toyota, Nissan, BMW, Volkswagen, and other car makes have warned owners to not to use E15. The American Automobile Association has warned that the results of allowing E15 to be sold at the pump will be a disaster. The response of those who advocate renewable fuels is that car owners should buy new cars that handle E15.
All this is a consequence of the policy of using command-and-control regulations to reduce pollution. The best alternative is a pollution charge equal to the damage caused. The price method will induce car owners to respond according to their own costs and benefits, whether it is to drive less, buy a different fuel, get a different car, or pay the charge.
This abuse of governmental power is also the result of dysfunctional mass democracy, which has the illusion of citizen choice but in fact places the power in the hands of bureaucrats and special interests. The problem of excessive regulation gets worse every year, as ever new restrictions and mandates are added, and they stifle the economy and reduce enterprise and employment. Regulations cannot be adequately reformed; they must be replaced by true and full pricing.