U.S. EPA officials writing rules for implementing the expanded national biofuels mandate said yesterday that they are open to changing methods for measuring biofuels' greenhouse gas emissions and plan to seek outside review of the matter.

But the agency has not bowed to industry pressure to withhold language on a key issue: measuring the emissions from "indirect" land-use changes stemming from increased cultivation of crops used in fuel production.

The 2007 energy law expanded the national renewable fuels standard to 36 billion gallons by 2022 and requires that growing volumes—ultimately reaching 21 billion gallons—come from next-generation biofuels such as cellulosic ethanol.

The rule is being reviewed by the White House Office of Management and Budget.

"We believe we are on track for completion of an expedited review," said Paul Argyropoulos, a senior policy adviser with EPA's Office of Transportation and Air Quality. "Unless there are some really sticky issues that I am not aware of to get the proposal out, I would say that we could see a proposal out in the next month."

Argyropoulos spoke at a meeting of a group that advises EPA on agricultural issues and repeatedly committed the agency to a broad review of input that will follow the rule's issuance.

"We need to emphasize that this is a proposal," he said, noting that in some areas the agency will be "co-proposing" options. "It is an opportunity for everyone to chime in on this thing," he said.

The 2007 energy law created the first federal standards for greenhouse gas emissions from biofuels. "Advanced" biofuels must have at least 50 percent lower emissions than conventional fuels, and cellulosic fuels—which reach 16 billion gallons—must be 60 percent lower.

But measuring the sum of the greenhouse gases relating to the lifecycle of fuels feedstock production and harvesting, refining biofuels and using them is a complex and evolving field.

Vincent Camobreco, another EPA staff member, told the advisory group yesterday that the agency will consult EPA's Science Advisory Board and also seek external peer review on the lifecycle analysis.

In particular, a major controversy erupted last year with the publication of a raft of competing studies on how "indirect" land-use changes affect the emissions levels.

The issue revolves around the extent to which use of land for growing biofuels crops prompts clearing of forests of other land worldwide for food production, thereby releasing substantial amounts of carbon into the atmosphere.

A range of biofuels companies and other interests, such as the biotech industry, leaned on EPA to withhold the indirect land-use change aspects of the rule and instead just publish its proposed methodology for review, alleging the science was incomplete.

But environmental groups lobbied the other way, stating that calculating emissions from land-use changes is needed to prevent future biofuels ventures that do not help curb levels of heat-trapping gases in the atmosphere.

Nathanael Greene of the Natural Resources Defense Council praised the agency for moving forward, though he cautioned that it remains to be seen how EPA addresses the issue specifically.

"It is about time that we are digging into the substance of this and collecting the input that EPA definitely needs to take the proposed rule and turn it into something that is really workable and final," said Greene, the group's director of renewable energy policy.

"They have done some really rigorous scientific and economic modeling, and that makes me optimistic that the results will be valid estimates of the land-use emissions, but it is just too soon to know."

But Paul Winters, a spokesman for the Biotechnology Industry Organization, said EPA's decision to move ahead with measuring effects of indirect land-use changes is not a setback. "We are confident that EPA will show that biofuels do reduce greenhouse gases compared to gasoline," he said.

"The industry will respond to the proposed rule during the comment period and will use that to try and achieve consensus that the EPA's methodology is reflecting the real value of biofuels in reducing greenhouse gas emissions," he added.

Governors call for task force  Meanwhile, governors who support ethanol wrote President Obama on Feb. 19 to urge the creation of an interagency panel on the issue of lifecycle emissions of transportation fuels.

"This high-level task force led by the U.S. Department of Agriculture (USDA), U.S. Environmental Protection Agency (EPA), and U.S. Department of Energy (DOE) would be charged with helping to resolve the debate over the lifecycle greenhouse gas emissions of biofuels," says the letter from the Governors' Biofuels Coalition, which is chaired by North Dakota's John Hoeven (R).

The 2007 energy law provides EPA flexibility on a number of areas, including the ability to revise downward the production and emissions levels in the mandate.

Argyropoulos noted that EPA would have to continually analyze whether the production levels can be met. Commercial cellulosic production has not begun ramping up, although some facilities are slated to come on line.

"It could be very, very promising, but there really aren't any commercial-scale biorefiners out there right now," he said of cellulosic ethanol. The expanded renewable fuels standard in the 2007 law calls for cellulosic ethanol targets beginning next year with 100 million gallons and escalating yearly, hitting 1 billion gallons in 2013 en route to 16 billion in 2022.

The upcoming rule to implement the standard comes as the corn ethanol industry is reeling from weakened demand and the financial crisis, prompting some plants to close.

The industry is leaning on EPA to issue a finding that allows higher ethanol blends in gasoline than the current 10 percent limit in order to expand the market.

The new 2009 annual outlook by the Renewable Fuels Association—a major ethanol trade group—warns that the industry is "quickly careening toward the blend wall," or the point at which the gasoline market is saturated with as much ethanol as it can handle at the 10 percent level.

"Without a change in federal standards, that level of ethanol use will undermine the goals of the RFS and become an unwarranted cap on the growth of this industry and the development of next-generation technologies," it states. The issue is under EPA review as agencies gauge how higher blends would affect engines and emissions.

The industry is posed to produce in excess of 10 billion gallons of ethanol this year, according to the trade group.

Reprinted from Greenwire with permission from Environment & Energy Publishing, LLC. www.eenews.net, 202-628-6500