PMAA: President’s renewable fuels goals are ‘mind-boggling’ bush

Many energy industry experts voiced skepticism about the feasibility of President Bush’s energy-efficiency goals, as detailed in his State of the Union address on Jan. 23. One of those was Dan Gilligan, president of the Petroleum Marketers Association of America. Gilligan told NPN MarketPulse that Bush’s proposals are “mind-boggling.”

“We like biodiesel,” Gilligan began. “We like ethanol. It’s worked well in the 10 percent blend, and in some of the rural areas the E85 – where it’s been priced properly – has been a success. But the numbers that the president was throwing around are just mind-boggling.

“The industry’s really struggling to get to five billion gallons of renewable fuels a year,” Gilligan continued. “How are we going to get to 35 billion by 2020? It’s just such an enormous undertaking.”

The Petroleum Marketers Association, Arlington, Va., is a federation of 45 state and regional trade associations representing approximately 8,000 independent petroleum marketers nationwide.

“We support as much renewable fuel as can be reasonably developed and blended into fuels,” Gilligan said, “but we really resist these mandates because mandates usually create shortages and shortages always create higher prices. It’s just that simple.”

Here are the president’s comments on ethanol, excerpted from a transcript of the State of the Union address:

“Extending hope and opportunity depends on a stable supply of energy that keeps America’s economy running and America’s environment clean. For too long our nation has been dependent on foreign oil. And this dependence leaves us more vulnerable to hostile regimes, and to terrorists, who could cause huge disruptions of oil shipments and raise the price of oil and do great harm to our economy.

“It’s in our vital interest to diversify America’s energy supply, and the way forward is through technology... We need to press on with battery research for plug-in and hybrid vehicles, and expand the use of clean diesel vehicles and biodiesel fuel. We must continue investing in new methods of producing ethanol, using everything from wood chips, to grasses, to agricultural wastes.

“We made a lot of progress, thanks to good policies here in Washington and the strong response of the market. And now even more dramatic advances are within reach. Tonight, I ask Congress to join me in pursuing a great goal. Let us build on the work we’ve done and reduce gasoline usage in the United States by 20 percent in the next 10 years. When we do that, we will have cut our total imports by the equivalent of three-quarters of all the oil we now import from the Middle East.

“To reach this goal, we must increase the supply of alternative fuels, by setting a mandatory fuels standard to require 35 billion gallons of renewable and alternative fuels in 2017. And that is nearly five times the current target. At the same time, we need to reform and modernize fuel economy standards for cars the way we did for light trucks, and conserve up to eight-and-a-half billion more gallons of gasoline by 2017. Achieving these ambitious goals will dramatically reduce our dependence on foreign oil, but it’s not going to eliminate it. And so as we continue to diversify our fuel supply, we must step up domestic oil production in environmentally sensitive ways. And to further protect America against severe disruptions to our oil supply, I ask Congress to double the current capacity of the Strategic Petroleum Reserve. America’s on the verge of technological breakthroughs that will enable us to live our lives less dependent on oil. And these technologies will help us be better stewards of the environment, and they will help us to confront the serious challenge of global climate change.”