Ethanol investors try to derail California’s carbon-emissions proposal

Ethanol investors met with Gov. Arnold Schwarzenegger this week in an effort to derail California’s far-reaching proposal to slash carbon emissions from transportation fuels.

The meeting, the latest volley in a national campaign against the regulation, was attended by Silicon Valley mogul Vinod Khosla and former Secretary of State Bill Jones, chairman of the board of Sacramento-based Pacific Ethanol Inc. One participant, New Fuels Alliance lobbyist Brooke Coleman, said the proposal is based on “completely speculative� scientific models and would cripple the nation’s biofuels industry.

Environmentalists are alarmed by the mounting attack on the state Air Resources Board, which will hold a hearing on the rule in Sacramento today. “There is an all-out war by corn ethanol interests, and they are using scare tactics to get others on board,� said Patricia Monahan, a vehicles expert at the Union of Concerned Scientists.

The rule would be the first in the nation to restrict planet-heating greenhouse gases from fuel. It is an essential component of the state’s landmark global warming law, which would slash the state’s carbon dioxide emissions by 15% over the next 11 years. President Obama has called for a national low-carbon fuel standard.

The Washington-based Truman National Security Project sent Schwarzenegger a letter this week from 66 retired military and intelligence officers -- including former National Security Advisor Robert McFarlane -- saying that the California standard would give oil “an unfair advantage. . . . It is a matter of national security.�

However, at least one signer had second thoughts. Vice Admiral Dennis V. McGinn sent out a news release saying that “upon more careful research,� he found the letter “missed the mark� and that the California standard should be adopted immediately as a national model.

Former Gen. Wesley Clark, co-chairman of the biofuels association Growth Energy, is also leading a charge against the proposal, saying that the rule’s “indirect land use� provision unfairly counts the global impact of growing corn for fuel by factoring in the displacement of forests that would be razed to grow replacement crops.

Mary D. Nichols, chairwoman of the Air Resources Board, said the California proposal would boost the use of biofuels, “including just about everything but imported corn.� The rule is aimed at spurring investment in cellulosic low-carbon fuels made from switch grass and other non-food plants.

Nichols said that Pacific Ethanol’s Jones, a Republican, “has been unceasing in his efforts to engage the governor,� but the governor’s staff has “been completely hands off.�

However, Blake Simmons, an official with the Emeryville-based Joint BioEnergy Institute, said the governor “was open-minded� during the meeting. Schwarzenegger spokesman Aaron McLear would not comment.

The Air Resources Board is scheduled to vote on the regulation next month.

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