Producers of renewable fuel and oil companies are often at odds but are teaming up to support legislation that would eliminate a seasonal ban on higher ethanol blends in gasoline. The move comes as both groups stand to lose if electric vehicles gain market share from conventional vehicles. However, “the far more fruitful collaboration between the oil industry and agribusiness will come from accepting they’ve lost the battle for passenger cars, and trying to carve out a place together in the skies,” writes Bloomberg Opinion columnist David Fickling.
This is a bigger challenge in that farms can’t produce enough biofuels to meet demand from the airline industry, “but the job would be a lot easier if they weren’t fulfilling pointless blending mandates for cars,” he says. Fickling notes the first U.S. plant for producing sustainable aviation fuel from ethanol opened last month and more will be built in the future.
But he acknowledges that if the two industries continue targeting electric vehicles, the timing is favorable for them as adoption appears to be slowing and some car manufacturers are pulling back on transition plans.
“An agro-petro alliance could be dangerously potent, politically. It would bring together rural voters and energy companies — and even the automotive sector itself, in the unlikely event that carmakers junk their transition plans altogether. The combined lobbying spending of those three sectors in Washington would exceed even that of the pharmaceuticals industry.”