WASHINGTON, D.C. — Environmental groups have withdrawn from a federal lawsuit challenging the way the Renewable Fuel Standard (RFS) is being implemented, on several fronts.

The Friends of the Earth (FOE) and National Wildlife Federation (NWF) were suing the U.S. Environmental Protection Agency (EPA) over its grandfathering-in of certain ethanol plants.

“This is a lawsuit aimed at the RFS and what we refer to as the grandfathering position,” said Matt Hartwig, a spokesman for the Renewable Fuels Assoc. (RFA). “What the RFS says is that plants that were in existence or under construction at the time the law was signed, December 2007, would be grandfathered into the law. The RFS has greenhouse gas (GHG) requirements that renewable fuels must meet in order to qualify.

“The angry birds are suing over the inclusion of plants built in 2008 and 2009, i.e., those that would have been under construction in 2007, into this grandfathering position.”

According to the RFA, what’s left of the lawsuit now is a dispute over requirements that ethanol plants must meet to generate trading credits under the RFS program.

“The main concerns were that the EPA incorrectly calculated the greenhouse gas emissions, and that they grandfathered in the corn ethanol plants that were already under construction,” said Michal Rosenoer, biofuels policy campaigner for the FOE. “Other groups brought other issues forward, but those were our concerns.”

Julie Sibbing, a spokeswoman for the NWF, said her group was concerned about the global rebound effect, as well as indirect land use.

“When you flood the market with ethanol, you cause prices of gasoline to go down around the world and increase worldwide consumption,” she said referring to the global rebound effect. “We also challenged the grandfathering of the plants. There were a lot of concerns.

“We withdrew because it was apparent the court wasn’t going to deal with the substance of the issues. We’re talking with our attorneys about where we go from here.”

In a response to the FOE’s lawsuit from May 2010, RFA CEO Bob Dineen derided the global rebound effect as a flawed theory. “To blame American biofuels for increasing global oil use defies simple common sense,” Dineen said. “By this tortured logic, any effort that environmental activists support to reduce America’s reliance on oil would be responsible for lowering U.S. oil demand, reducing global oil prices and inciting increased consumption somewhere else in the world.

“Increasing mileage standards, deploying electric vehicles and any other measure designed to reduce U.S. oil demand would be penalized with carbon emissions from increased global oil consumption under this rubric. It simply doesn’t pass the sniff test.”

But FOE attorney Jonathan Lewis wrote in a note that Congress directed the EPA to ensure GHG emissions from biofuel meeting the RFS mandates have to be lower than emissions from petroleum fuels.

“EPA’s analysis used emissions projections for biofuels produced in 2022, when production-related emissions are supposed to be considerably lower,” Lewis wrote. “Had EPA used the projections it did for biofuels produced in 2012, new corn ethanol and soy biodiesel would not have satisfied the GHG reduction requirement.”

Lewis also wrote that Congress told the EPA to account for “indirect emissions” using the theory of indirect land use change, and that the agency failed to consider the global rebound effect.

“The point is that EPA assumed that biofuels would displace petroleum on a 1:1 basis, even though there’s standard economic theory to the contrary,” he wrote.

Lewis also complained the EPA just looked at the total agricultural land in the United States and said everything is fine unless total acreage is exceeded going forward.

“So, to use one possible scenario, EPA won’t notice if 1,000 acres of wetland are farmed over with corn for ethanol, as long as that loss is ‘balanced out’ when 1,000 acres of farmland somewhere are converted into a shopping mall,” he wrote.

In a response filed with the United States Court of Appeals for the District of Columbia Circuit last October, the EPA said it is justified in using an “aggregate compliance approach” because the overall trend is toward “agricultural land contraction,” not expansion.

“EPA found that despite increases in demand due to population increases and expanding export markets such as China, domestic agricultural acreage decreased from 1997 to 2007 by 41 million acres,” the brief reads.