Obama urges greater use of biofuels

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The Obama administration gave a boost to the corn and coal industries Wednesday, announcing a series of moves to accelerate biofuel use and deploy so-called clean-coal technology on power plants.

Unveiling the actions in a meeting with energy-state governors at the White House, President Obama said the steps would create jobs in rural areas, reduce foreign energy dependence and curb the emissions that scientists blame for global warming.

“It’s important for us to understand that in order for us to move forward with a robust energy policy,” Obama said, “we’ve got to have not an either/or philosophy but a both/and philosophy -- a philosophy that says traditional sources of energy are going to continue to be important for a while, so we’ve got to just use technologies to make them cleaner and more efficient.”

Most notably, the U.S. Environmental Protection Agency made final a regulation that could give corn ethanol a much larger share of the renewable-fuel market mandated by Congress in 2007.

An earlier version of the rule included a controversial calculation -- since reworked by EPA scientists -- that would have minimized corn ethanol’s role because of concerns about the fuel’s overall pollution-fighting credentials.

The administration said the EPA rule alone would lead to a $41.5-billion reduction in oil imports and take the equivalent of 27 million vehicles off the road.

Administration officials also announced a revamped strategy to put the nation on track to meet the congressional mandate of 36 billion gallons of biofuel by 2022, in hopes of fixing a government effort that officials admit has fallen short in its attempts to wean cars and trucks away from fossil fuels and move toward ethanol, biodiesel and other crop-based fuels. The nation currently produces about 12 billion gallons of biofuel, mostly corn ethanol, and the federal government projects the country will not meet the 2022 goal.

And Obama issued a presidential memorandum to speed the development of technologies that capture and store the carbon dioxide emissions from coal plants, with a goal of bringing five to 10 commercial-scale projects on line by 2016.

Many industry groups cheered the decisions, particularly corn-ethanol boosters, who have lobbied heavily for an expanded corn role under the EPA’s renewable-fuel standard.

Under a draft of the regulation released last year, EPA scientists determined that corn ethanol produced too many greenhouse gas emissions to qualify as a renewable fuel, effectively limiting the fuel’s role to a level mandated by Congress.

The finding was controversial because it included a scientifically debated calculation of the “indirect” land-use effects of corn ethanol production -- the idea that growing corn for fuel domestically could spur farmers overseas to cut down trees and plant crops such as soybeans.

EPA scientists revised their calculations for the final regulation to include new information on crop productivity and a more global view of indirect land-use effects, and they concluded corn ethanol produced in the most energy-efficient manner would in fact meet the emissions standard, EPA Administrator Lisa P. Jackson said.

“We weren’t trying to appease any particular industry or reach any particular outcome,” she said. “Based on what we know now, there is no basis to exclude these fuels.”

Some environmental groups praised the EPA for continuing to factor indirect land use into the calculation, despite pressure to exclude it.

Despite the announcements, ethanol and corn futures slumped on the Chicago Board of Trade.

Denatured ethanol for February delivery fell 1.9 cents, or 1.1%, to $1.785 a gallon.

Corn for March delivery fell 12 cents to $3.53 a bushel.