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Feds turn down Georgia for ethanol waiver
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The Environmental Protection Agency has denied requests from several governors, including Georgia Gov. Nathan Deal, to waive production requirements for corn-based ethanol.

A renewable fuels law requires that 13.2 billion gallons of ethanol be produced by this year and 15 billion gallons be produced by 2015. That’s good for corn farmers, but it has angered poultry, hog and cattle farmers who say they’ve seen big jumps in corn-based feed costs as the crop is diverted to make fuel.

Deal, whose home county of Hall is the epicenter of Georgia’s poultry industry, wrote to EPA Administrator Lisa P. Jackson in August.

“In addition to the direct economic damage from drought within the border of our state, Georgia is heavily dependent on grain produced in other states to support its poultry and livestock industries,” Deal wrote.

States requesting the waiver say reduced corn production due to this year’s drought — which ravaged corn-producing Midwestern state — has made the problem even worse.

Emory Forrester, director of feed milling and feed delivery for Baldwin-based poultry processor Fieldale Farms, in an earlier interview said 98 percent the corn it uses comes from the Midwest.

Chicken feed is composed of 60 percent corn, 20 percent soy and 20 percent other ingredients, such as minerals, Forrester said.

Governors of North Carolina, New Mexico, Texas, Virginia, Maryland, Delaware, Utah, and Wyoming also asked for the waiver, along with members of Congress and a coalition of farm groups and other industries that have opposed increased ethanol production.

Abit Massey, president emeritus of the Georgia Poultry Federation, said he was “disappointed and sorry to hear” that the waiver was denied. Current president Mike Giles echoed his disappointment, saying that the evidence presented to the EPA was more than sufficient to prove the unintentionally negative consequences of the law.

“When Congress originally established the requirement, they foresaw there might be harm, they therefore put in this provision to suspend the mandate in circumstances like this,” Giles said. “We think the drought coupled with the mandate creates a short supply of corn, such that the provision should be used.”

He added, “If it’s not going to be used on this extraordinary circumstances, when will it be used?”

The EPA said Friday that the agency has studied the effects of waiving the requirement and officials believe it would have had little impact on corn prices.

“We recognize that this year’s drought has created hardship in some sectors of the economy, particularly for livestock producers,” said Gina McCarthy, assistant administrator of the EPA’s Office of Air and Radiation. “But our extensive analysis makes clear that congressional requirements for a waiver have not been met and that waiving the Renewable Fuel Standard will have little, if any, impact.”

Under the EPA’s interpretation of the renewable fuels law, first passed in 2005 and then significantly expanded in 2007, it is not easy to qualify for a waiver. The EPA can grant a waiver if the agency determines that the set ethanol production would “severely harm” the economy of a state, region or the entire country.

It’s not enough if the standard just contributes to the harm, the EPA said, noting the agency also has a high threshold for the degree of harm done.

Beyond Georgia, there was a uniformly angry reaction to the decision in the poultry industry.

“We are extremely frustrated and discouraged that EPA chose to ignore the clear economic argument from tens of thousands of family farmers and livestock and poultry producers that the food-to-fuel policy is causing and will cause severe harm to regions in which those farmers and producers operate,” the coalition said in a statement.

Environmental groups also have opposed increased ethanol production, saying the excess corn planting is tearing up the land.

Scott Faber, a lobbyist for the Environmental Working Group, said this most recent waiver denial may further energize ethanol opponents to lobby Congress to repeal the entire renewable fuels law and not “tinker with a safety valve that is too tight for either a Democratic or Republican administration to turn.”

Going forward, Giles said he hopes the industry can work with Congress to modify the law.

“Actually a bill was introduced, one that waives or reduces the ethanol mandate when certain triggers are set off, on a sliding scale. Those are the kind of reasonable approaches we need,” he said.

The Bush administration turned down a request by Texas Gov. Rick Perry in 2008 to waive the mandate because of drought in his state.

The Associated Press contributed to this report.

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