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Unlikely allies: Auto industry and ethanol advocates fight key environmental legislation at Legislature

By Ron Way | Monday, March 24, 2008
Major environmental legislation that would require the auto industry to curb tailpipe emissions in Minnesota beyond federal rules has crashed into an unsuspected roadblock in the Legislature: the state’s ethanol p

Marquee environmental legislation that would require the auto industry to curb tailpipe emissions in Minnesota beyond federal rules has crashed into an unsuspected roadblock in the Legislature: the state’s ethanol producers.

The “California Clean Cars” legislation is in danger of being ditched by the clean-fuels folks, as the ethanol industry sees itself, in alliance with the auto lobby.

“We can’t stop this bill by ourselves,” said Eric Hyland of the Alliance of Automobile Manufacturers.

That’s why his group and the Minnesota Auto Dealers’ Association have courted ethanol producers and agriculture powerhouses like the Minnesota Corn Growers and the Farm Bureau to join the fight being waged in Minnesota and eight other states over whether the federal Environmental Protection Agency (EPA) in Washington, D.C., or the California Air Resources Board (ARB) in Sacramento should be the guiding authority on regulating auto emissions.

Hyland and the state’s auto dealers’ group are among those closely watching companion bills by DFLers Sen. John Marty of Roseville and Rep. Melissa Hortman of Blaine wend through a maze of legislative committees. Also shadowing the bills’ progress is the Clean Energy Minnesota, a coalition of environmental advocates led by James Erkel of the Minnesota Center for Environmental Advocacy.

(To view both bills go here. For the House version type H.F. 0863 in the House “bills” box, and for the Senate version type S.F. 0481 in the Senate “bills” box.)

Concern about biofuels
In the Senate, Marty’s bill was dealt a potentially crippling blow this morning when Sen. James Metzen, DFL-St. Paul, announced that his Business, Industry and Jobs Committee is unlikely to hear the bill, a move that could potentially kill the legislation. In the House, Hortman’s bill is in the Finance Environment Committee, where it’s expected that committee Chair Rep. Jean Wagenius, DFL-Minneapolis, will fold it into an omnibus environment bill.

Both bills suffered a major blow when the ethanol industry joined the fray with a blizzard of questions about what the legislation would mean for the biofuels industry in Minnesota. The National Ethanol Vehicle Coalition of Missouri together with Farm Bureau and Minnesota Corn Growers President Roger Moore of Blue Earth, Minn., oppose the legislation, saying it could curtail the use and production of ethanol-blended fuels.

Moore has told lawmakers that the legislation would harm efforts to expand ethanol markets and that it would “make it difficult to certify E-85 vehicles,” the so-called flex fuel cars and trucks that can run on a variety of ethanol-gasoline blended fuel.

Erkel said the concern is baseless, pointing to GMC’s 2008 Sierra 1500 pickup that runs on a rich blend of E-85 (85-percent ethanol and 15-percent gasoline) as well as similar vehicles that would meet the more stringent California standards.  The ARB’s Dimitri Stanich said California air regulators have certified 300,000 flex fuel vehicles and suggested there will be more as soon as the state increases the number of pumps offering E-85 fuel, which California is now doing.

“These bills would not curtail ethanol markets and in some respects actually help it,” Erkel said, expressing frustration over why the ethanol advocates oppose the legislation even though, he asserts, there is scant evidence that the ethanol industry would be adversely affected.

Erkel added that the bills would not jeopardize Minnesota’s attempt to win needed EPA approval to become the nation’s first state to require refiners to produce an E-20 ethanol blend for sale in the state, up from the current E-10.

Still, rural legislators have expressed skepticism. Calls by MinnPost to the Corn Growers and the Farm Bureau ended with representatives saying they needed to check with their “technical people” for specific reasons for the groups’opposition to the legislation. Neither group’s representatives called back with what they may have learned from their technical advisers.

The bills would legally bind Minnesota to California regulations that require automakers to meet air quality standards that are more stringent than those required by the EPA.  Moreover, California limits emissions of carbon dioxide and other pollutants linked to climate change.

California has been the nation’s de facto lead regulating authority for automobiles for the last 40 years. Many of the safety features and emissions requirements for cars sold in the United States are rooted in California rules that are routinely adopted by the EPA for national implementation.

Last April, California rules were upheld in a celebrated legal test brought by Massachusetts that for the first time allowed a state to regulate carbon dioxide and other “greenhouse emissions,” something that was soon adopted by 12 other states. That court decision handed a major loss to the auto industry and was followed by another defeat of sorts last December when President Bush signed the 2007 Energy Act that contained the first tightening of fuel economy standards in 20 years.

While the energy bill was seen as a blow to the auto industry and its allied labor unions, Erkel said it really was a ploy to keep the much tougher California rules from taking effect.  He argued that the automakers saw their support of emerging federal rules as a way to blunt California’s more stringent requirements.

Erkel said that the auto industry is masquerading as an ethanol advocate as it enlists the corn growers and other farm groups to beat back legislation in Minnesota. The default “technical adviser” to the ethanol groups opposing the Marty and Hortman bills is the National Ethanol Vehicle Coalition, headquartered in Jefferson City, Mo. Its 16-member board of directors includes representatives of Chrysler, Ford, GMC and Nissan.

National attention
Last December, the EPA refused to allow California to enact its carbon reduction regulations.  The controversial decision was immediately challenged in court by California and 17 other states, including Minnesota.

Meantime, the issue gained national attention when it was injected into presidential politics: Republican Sen. John McCain and Democrats Sens. Barack Obama and Hillary Rodham Clinton have promised to overturn the EPA decision.

Erkel said the California regulations, if enacted in Minnesota, would improve Twin Cities air quality by reducing exhaust emissions in passenger vehicles, would significantly reduce carbon emissions and help meet carbon reduction mandates in Minnesota’s 2007 Next Generation energy law, would improve fuel economy much ahead of the timetable in the 2007 federal energy law, and save consumers money through improved fuel efficiency of cars. Under the Minnesota legislation, lower emissions would be initially required in 2012 model vehicles.

The Minnesota Climate Change Advisory Group, appointed by Gov. Tim Pawlenty to develop ways to meet the state’s carbon reduction laws, identified the California initiative as a major carbon reduction strategy that would also reduce consumer costs through improved automobile fuel efficiency.

But the Minnesota Auto Dealers’ Association says the legislation would increase new vehicle costs and potentially reduce the availability of SUVs and passenger pickups. This is because it’s technically easier for lighter vehicles with lower horsepower to meet lower tailpipe emission standards because they use less fuel and spew less exhaust.  The industry says this means that auto dealers would have to sell fewer big vehicles so that emissions from the broad fleet would be lower.  The auto dealers have posted their concerns on this website.

That argument didn’t play well in the Senate Transportation Committee on Tuesday when it voted 12-5 to move Marty’s bill to its next stop, Metzen’s Business, Industry and Jobs Committee, where the legislation now languishes.

In earlier legislative committee action, amendments were added to the bills that would restrict enforcement to passenger vehicles weighing less than 8,500 pounds.  Excluded are large trucks, all-terrain recreational vehicles, including snowmobiles, utility machines with small engines like lawnmowers and vintage street rods.

Ron Way, a former reporter for several Midwest newspapers, covers the environment and energy issues. He can be reached at rway [at] minnpost [dot] com.