CHICAGO – As President Bush promotes ethanol as a green alternative to gasoline, his administration is quietly relaxing environmental rules for dozens of new corn-to-fuel refineries sprouting up across the nation.

The U.S. Environmental Protection Agency is planning to change the way ethanol plants are treated under the Clean Air Act, a move critics say could make it easier for the burgeoning industry to evade controls that dramatically reduce toxic air pollution.

The shift in policy would give a break to agricultural conglomerates and newcomers seeking to cash in quickly on the nation’s growing thirst for renewable fuel. More than 40 new ethanol plants are expected to be built during the next year, boosting U.S. production by 30 percent.

Industry supporters say the new rule is crucial to sustain the ethanol boom, which they contend will reduce the nation’s dependence on imported oil and cut greenhouse gas emissions from fossil fuels.

“Ethanol is good for the environment,” Bush said during an April speech that touted the fuel additive as a key part of America’s energy strategy.

Critics note that the ethanol industry has been growing rapidly despite existing environmental regulations. The number of corn-to-fuel refineries has increased from 50 in 1997 to 101 this year, according to industry statistics.

The proposed rule, which needs only a notice in the Federal Register to take effect, comes less than four years after the Bush administration brokered a series of legal agreements that promised deep cuts in air pollution from leading players in the industry.

EPA regulators had decided to take a closer look at the refineries following complaints about noxious odors from several ethanol plants in the Midwest. The agency discovered many were emitting carbon monoxide, methanol and cancer-causing chemicals at levels far greater than the owners had reported.

“Those facilities were prosecuted under the exact law they’re proposing to weaken,” said John Walke, director of the Natural Resource Defense Council’s clean air project. “They’re cutting corners now so the wave of new ethanol plants can be bigger, cheaper and dirtier.”

There already are questions about whether ethanol is good for the environment. The fuel additive releases somewhat less carbon dioxide than gasoline – reducing the amount of greenhouse gases that are making the planet hotter. But the EPA recently reported that pumping more ethanol into cars and trucks is expected to increase the amount of chemicals that create smog.

Existing clean-air rules consider ethanol plants as major sources of air pollution if they emit more than 100 tons of toxic chemicals a year. Those that do must go through an intensive – and time-consuming – permitting process. They also must install equipment that burns off most of the emissions.

Under the proposed changes, ethanol plants wouldn’t be subject to the stringent federal requirements unless they spewed more than 250 tons of air pollution. Most of the new refineries are expected to emit a few tons less than that.

The difference in emissions could be substantial, in part because the control equipment must reduce pollution levels by up to 95 percent.

For instance, a plant that releases 200 tons of pollution could have to cut emissions to 10 tons under the current rules. But that same plant would be required to do little if anything under the proposed changes.

Farm-state lawmakers, led by U.S. Sen. John Thune, R-S.D., argue that the new rule is needed to remove “considerable administrative burdens” that can add costly construction delays for new and expanded ethanol plants.

“This rule would remove stifling regulatory barriers, while protecting the environment, so ethanol production can increase and we can make significant progress toward our goal of achieving energy independence in the United States,” Thune said in a statement.

Some state regulators, though, worry that the projected increases in air pollution could make it more difficult for Chicago and other urban areas to meet federal health standards intended to protect people suffering from asthma and other respiratory illnesses.

“If anything, we need to be paying closer attention to these operations, not looking the other way,” said William Becker, executive director of two associations that represent state air pollution regulators.

Environmental groups think one of the motives behind the new rule is to make it easier to change the type of fuel used to produce ethanol. Most of the industry now relies on natural gas, but several in the planning stages would burn coal, which is less expensive but produces far more pollution.

Although the federal rulemaking docket is filled with industry letters urging the EPA to adopt the changes, a few producers worry that the new rule could further undermine ethanol’s environmentally friendly image.

“If we are supposed to be creating a cleaner fuel, shouldn’t we be producing it in a way that’s cleaner?” said Randy Doyal, chief executive officer of Al-Corn Clean Fuel, a Minnesota company that distills more than 30 million gallons of ethanol a year.

Four years ago, Al-Corn and 11 other Minnesota ethanol plants were forced to install pollution controls as part of legal settlements with the Justice Department and the EPA. He and other producers contend that the new rule would be giving the new wave of ethanol plants an unfair advantage.

Federal inspectors determined that after ethanol is distilled from corn starch, the fermented mash produces toxic fumes as it is dried for sale as livestock feed. The chemicals can be burned off with devices known as thermal oxidizers.

The government later reached a similar agreement with Archer Daniels Midland, the agricultural processing giant that dominates the ethanol market.

At the time Bush administration officials vowed that the agreements would set tough standards for the entire ethanol industry.

“Americans deserve clean air to breathe,” then-Attorney General John Ashcroft said when announcing the ADM settlement. “And we all benefit when organizations make the right decisions and bring their facilities into compliance with our environmental laws and regulations.”

Doyal said the Minnesota producers made the same arguments four years ago that the EPA is using today to justify changing the rules.

But installing pollution controls at Al-Corn’s plant turned out to be less expensive than the company thought, Doyal said. And heat generated by the thermal oxidizers helped cut the company’s energy costs.

“It works really well,” he said. “And our emissions are next to nothing.”


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