CEO DATELINE - Ethanol groups question relevance of Cruz victory for their industry
CEO DATELINE - Ethanol groups question relevance of Cruz victory for their industry
- February 3, 2016 |
- Walt Williams
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Sen. Ted Cruz (R-Texas) is no friend of ethanol subsidies, which makes his victory in Monday's Iowa caucuses all the more surprising, given how heavily that state relies on the ethanol industry. But pro-ethanol groups say lawmakers shouldn't read too much into the election results.
Cruz has long supported abolishing the federal Renewable Fuel Standard, which requires ethanol to be blended with gasoline. The puts him in line with the fossil fuel industry, which argues ethanol is a costly boondoggle that does little to help the environment, despite what supporters claim. But corn-producing states like Iowa depend heavily on ethanol sales, given that most ethanol is made from corn.
A coalition of ethanol producers, named America's Renewable Future, ran ads in Iowa attacking Cruz for his stance against the RFS. In the end the campaign appeared to do little good, much to the delight of ethanol opponents.
"Despite big ethanol's effort to sell their government handout which is a hidden tax on food commodity prices, Iowa voters rallied around the free market which will ultimately benefit the ethanol industry when the federal mandate is repealed," said Rob Green, executive director of the National Council of Chain Restaurants. (The council, part of the National Retail Federation, maintains that ethanol production drives up food prices by diverting corn to make fuel.)
However, America's Renewable Future noted Cruz and Sen. Rand Paul (R-Ky.), who also opposes the RFS, together received only 32 percent of the total vote in Iowa. That means a majority of voters chose candidates who support the mandate.
"Considering that when we started only two Republicans were known supporters of the RFS and we ended with nine out of 11 in the pro column and 12 candidates out of the 14 total," said Eric Branstad, the coalition's Iowa state director. "We're incredibly proud of the success we've had with candidates recognizing the benefits to our economy, national security, and environment and it's something that will be key in the general election."
Also, Cruz is not the quite opponent of ethanol the industry's detractors have made him out to be, Renewable Fuels Association CEO Bob Dinneen said. Cruz may be opposed to the RFS, but he has expressed support for ethanol as a fuel and called it an effective additive that increases octane and decreases harmful tailpipe emissions.
"That doesn't sound like someone to me who is writing off the domestic ethanol industry," Dinneen said. "That sounds to me like someone who is just being true to his no-mandates of any kind philosophy."
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