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RFS Field Hearing Testimony from Jeff Oestmann

The CEO of East Kansas Agri-Energy, Jeff Oestmann's full testimony during the recent RFS Field Hearing

 

I'm Jeff Oestmann, president and CEO of East Kansas Agri-Energy in Garnett, Kansas.  

As the Chief Executive of an ethanol plant, I've seen the powerful positive impact that renewable fuels have on our community, our farmers, our environment and our nation.  I have seen America keep more of its energy dollars at home instead of sending them to countries that simply don't like us very much.  After spending more than a decade serving in the Marine Corps around the world, I can tell you that I'd much rather do business in the Midwest than with the Middle East.

 

This rulemaking underscores EPA intent to encourage the development of advanced biofuels—and for that we congratulate you and thank you.  By consistently raising the requirements for all pools in the advanced sector, EPA is sending a clear signal to the financial community that the federal government intends to support this sector moving forward. 

But let us not forget that our renewable fuels future will continue to be built on the foundation of conventional ethanol production.  The RFS has helped us build that foundation—and it will help us build what is to come in terms of advanced biofuels.   That’s why it is so critical to stay the course regarding the RFS program’s conventional renewable fuel volumes authorized by Congress. The statute requires 15 billion gallons of conventional renewable fuels in 2017 and we see absolutely no reason for EPA to set the RVO below that level. Anything less sends a negative signal to investors about the sturdiness of the RFS program’s very foundation.

 

We also appreciate the emphasis you have placed on drop-in fuels such as renewable diesel by placing them among your priorities for new technology pathways.  As you know, drop-in fuels are well suited to early adoption, and are positioned to enter the marketplace easily and grow quickly.

Later this year, our plant will be starting up the nation’s first renewable diesel production facility that is bolted on to an ethanol facility. Renewable diesel is a true drop-in fuel that represents the next generation of advanced biofuels prescribed in the RFS. 

The model at our plant combines the best of both worlds—a traditional higher octane fuel required in today’s gasoline blends; plus a high energy-density drop-in fuel required for heavy engines trucks in a growing global diesel demand pool.  We’re helping bring the very intent of the statute passed by Congress into reality—maximizing the benefits of renewable feedstock to make as many gallons possible for as many uses possible.  Renewable diesel allows us to create two different fuels from one kernel of corn.  That means that corn is the feedstock for both conventional ethanol—and advanced biofuel. 

 

I can assure you that this investment—and this technology—would not have happened without the RFS.

The fact that we will producing both ethanol and renewable diesel in one facility creates new jobs and economic vitality—and provides further proof that our nation is on the path toward the continued evolution of advanced biofuels.

If the EPA truly wants advanced biofuels to succeed, the RFS must follow the pathway outlined in the statute approved by Congress.  We cannot take the detour EPA has proposed through its novel use of the general waiver authority.

Our long-range strategic plan includes other new projects and technologies over the next three to five years.  But those are currently on hold—thanks to the uncertainty that the EPA has created about the RFS.   By manipulating waivers and giving the oil industry a back-door through which to escape their obligations, billions of dollars of investment nationwide that are poised to help America continue to evolve its biofuels industry will be stranded.

Returning to statutory requirements in 2017 would send a clear signal to the marketplace that the pathway to even more lower-carbon advance and cellulosic biofuels is certain.  That will accelerate investment and technologies that will help our nation become even more self-reliant, economically robust and environmentally-friendly.

By adopting the RFS, Congress has given America greater control over its future.   Greater control over where our energy comes from.  Greater control over the choices consumers have at the pump.  Greater control over our environment.   And just as importantly, the RFS has given the petroleum industry less control over America's pocketbooks, energy independence and our environment. 

When it comes to domestic renewable fuels, we don't need less.  We need more.  And that's exactly what the RFS passed by Congress has outlined.   Advanced biofuels are coming fast—but we cannot hamper this growth by reducing our nation’s commitment to the traditional ethanol industry that has created these opportunities for all of America.

Thank you for the opportunity to comment—and thank you for your continued review and efforts to move the advanced biofuels sector forward.  However, I urge you to leave the RFS alone and let it do what's it's been doing—and continues to do:  Strengthening our nation's energy supply, economy, environment and our very future.  Thank you.


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