Farm Bill Amendment Pits Big Refiners Against Smaller Operations. Is It Time to End Ethanol?

A controversial amendment to the 2026 Farm Bill is lighting up Capitol Hill, pitting big refining interests against smaller operations in a classic Washington showdown over the Renewable Fuel Standard (RFS) and ethanol mandates. Rep. Michelle Fischbach (R-MN) introduced Amendment 289, which would force year-round nationwide sales of E15 (15% ethanol gasoline) by aligning its volatility standards with E10 and streamlining compatibility rules for retailers. It also reforms the small refinery exemption (SRE) program under the RFS—tightening the definition of a “small refinery” (capping at 75,000 barrels per day capacity starting in 2028) and limiting exemptions while allowing some hardship carve-outs for at-risk plants.

Supporters include a broad coalition: ethanol producers, big farm groups like the National Corn Growers Association, John Deere, the National Farmers Union, and even the American Petroleum Institute (API), which represents many major refiners. Opponents, led by the Small Refineries of America (SRA), argue it threatens small refineries, jobs, communities, and U.S. energy security while raising consumer costs. As David Blackmon detailed in his Substack/Frobes piece, this isn’t just about E15—it’s a backdoor expansion of the ethanol mandate that could accelerate closures of smaller, independent refiners already squeezed by RFS compliance burdens.

The amendment highlights the deep divisions in the refining sector. Big players can absorb (or even profit from) RFS credits and blending, while smaller operations often seek SREs to survive. But beyond the refiner vs. refiner drama, this fight begs a bigger question: Why are we still forcing ethanol into our fuel supply in the first place?

The Energy Math Doesn’t Add Up

Let’s cut through the green hype with hard data on energy return on energy invested (EROI)—the true measure of whether a fuel gives back more than it takes to produce.

Corn ethanol, which dominates U.S. production (over 15 billion gallons annually under the RFS), has a pitiful EROI of roughly 1.3:1 to 1.5:1 according to multiple peer-reviewed analyses. Some studies peg it even lower at around 1.07:1 or, in pessimistic but credible cases, below 1:1—meaning you invest as much (or more) energy as you get out.

Gasoline, by contrast, delivers 5:1 to 15:1 (or higher in some estimates), even after accounting for declining conventional sources.

Biodiesel from soybeans fares a bit better (net energy gain around 93% in older studies, with fossil energy ratio improving to ~5.5:1 in efficient cases), but first-generation biofuels overall lag far behind petroleum products. Cellulosic ethanol (from non-food sources like switchgrass) shows promise at 2:1 to 10:1+ in projections, but it remains commercially negligible despite decades of subsidies.

In plain English: Producing corn ethanol often consumes nearly as much energy (from fertilizers, farming diesel, distillation, etc.) as the fuel provides. David Pimentel’s analyses and meta-reviews have long shown corn ethanol can be a net energy sink when full lifecycle costs—including soil erosion, machinery, and co-product credits—are tallied accurately.

Worse MPG, Higher Real Costs for Drivers

Ethanol’s lower energy density compounds the problem. Pure ethanol contains about 33% less energy than gasoline. Blends deliver real-world hits:E10 (the standard today): ~3% drop in miles per gallon.

E15: An additional 1-2% penalty, or roughly 1.5-1.74% lower fuel economy vs. E10.

Drivers in E15-heavy Midwest markets notice it at the pump—more gallons burned for the same trip, erasing any “discount” on the sticker price. EPA and DOE data confirm vehicles go 3-5% fewer miles on ethanol blends versus straight gasoline.

Add in higher production costs subsidized by taxpayers, and the entire system transfers wealth from drivers and refiners to the ethanol complex.

Who Actually Profits? Farmers, Lobbyists, and Politicians

The RFS and ethanol subsidies were sold as energy independence, rural jobs, and lower emissions. Reality: They’re a massive, ongoing transfer payment.Farmers and Big Ag: Corn growers and ethanol producers (POET, ADM, etc.) are the primary winners. Mandates guarantee demand, propping up corn prices and distillers’ grain markets. The Renewable Fuels Association and farm lobbies pour millions into D.C. influence.

Lobbyists: The corn ethanol lobby has secured tax credits, tariffs, and mandates for decades through heavy spending. Groups like the American Farm Bureau and ethanol trade associations excel at this.

Politicians: Especially from Iowa, Minnesota, and other corn states. Bipartisan support for Farm Bill ethanol expansions is no accident—campaign contributions flow accordingly.

Big Oil/refiners? Mixed. Some (via API) back E15 expansion for blending credits or RIN market plays. Others, especially smaller independents, get crushed by compliance costs without exemptions. Taxpayer-funded credits like 45Z have even created strange Big Ag–Big Oil alliances, with billions in subsidies flowing.

Independent analyses show the net societal benefit is tiny or negative once you subtract food-price inflation, land-use impacts, and higher pump prices. Ethanol’s “green” claims are overstated too—lifecycle GHG reductions are modest at best (12-46% in optimistic studies) and often wiped out by indirect land-use change.

Time to End the Ethanol Mandate?

The Farm Bill amendment is just the latest symptom of a broken policy. The RFS, born in the 2000s energy crisis, has outlived its usefulness. We have abundant domestic oil and gas. Electric vehicles, efficiency gains, and advanced fuels are evolving without mandates. Forcing low-EROI, lower-MPG ethanol into every tank raises costs, distorts markets, and delivers minimal environmental upside.

Small refiners are right to fight for survival. But the real fix isn’t tweaking exemptions—it’s repealing the mandate entirely and letting markets decide fuel blends based on economics and performance.

Farmers and rural economies deserve support, but not at the expense of energy reality. Subsidies and mandates don’t create net energy—they just pick winners and losers. It’s past time to end ethanol’s privileged status and let better technologies compete on merit.

The post Farm Bill Amendment Pits Big Refiners Against Smaller Operations. Is It Time to End Ethanol? appeared first on Energy News Beat.