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Feb 27 (Reuters) - U.S. President Donald Trump will gather with senators and Cabinet officials on Tuesday to discuss ways to lower the cost of the nation’s biofuels policy to refiners, a meeting that will pit Big Corn against Big Oil.
The meeting reflects rising concern in the White House over the current state of the U.S. Renewable Fuel Standard (RFS), a law requiring refiners to mix biofuels such as corn-based ethanol into their fuel, which has increasingly divided two of Trump's most important constituencies.
A refining BOP Blow Out Preventer repair company gulf coast in the key electoral state of Pennsylvania last month blamed the regulation for its bankruptcy.
Tuesday's meeting will include Republican Senators Ted Cruz of Texas, Pat Toomey of Pennsylvania, Chuck Grassley and Joni Ernst of corn state Iowa, along with Environmental Protection Agency Administrator Scott Pruitt, Agriculture Secretary Sonny Perdue, and Energy Secretary Rick Perry, according to sources briefed on the meeting.
The meeting will also include White House legislative director Marc Short, who will seek to ensure any agreement can be achieved through executive orders and regulatory actions defensible in court, the sources said.
Representatives for the officials declined to comment. The White House will issue a statement later on Tuesday, spokeswoman Kelly Love said.
U.S. farm groups urged Trump in a letter on Monday not to weaken the RFS, calling it a critical engine of rural jobs. "Any action that seeks to weaken the RFS for the benefit of a handful of refiners will, by extension, be borne on the backs of our farmers," the groups said.
The meeting comes alongside a legislative effort to alter the RFS, led by Republican Senator John Cornyn of Texas, which faces stiff resistance from corn states.
The refining industry is not unified in how to address the RFS, complicating the White House efforts.
"“Andeavor has always been in favor or a broad-based, legislative solution to the RFS, such as the effort being pursued by Senators Cornyn and (Tom) Udall," Stephen Brown, a lobbyist at the independent U.S. refiner, told Reuters on Tuesday.
"While we don’t have a huge problem with regulatory solutions being discussed, we don’t think it’s legally sustainable and ultimately gets us nowhere."
Under the RFS, refiners must earn or purchase biofuel blending credits called RINs to prove to the federal government that enough biofuels are being blended into their gasoline and diesel to comply with the policy.
As biofuels volume quotas have increased over the years, however, so have prices for the credits. Refiners that do not have their own blending facilities are required to buy the credits and are facing rising costs.
Oil refiner Philadelphia Energy Solutions (PES), which employs more than 1,000 people, filed for bankruptcy protection last month and blamed the regulation for its demise.
