Grassley fires a new missile over the blend wall, aims for FTC

Grassley fires a new missile over the blend wall, aims for FTC

WASHINGTON – Last Thursday, Iowa Senator Chuck Grassley, along with Minnesota Senator Amy Klobuchar, sent a letter to the Justice Department and the Federal Trade Commission, requesting further examination of possible anti-competitive practices of some oil companies.

Grassley says he already sent a letter to FTC last year, but nothing came of it. Last week’s letter was fueled by a new analysis from the Renewable Fuels Association, which found that unbranded gas stations were 40 times more likely to offer E15 to customers than were gas station carrying a “Big-Five” oil brand like BP plc or ExxonMobil.

However, even with a second salvo fired at FTC, Grassley isn’t exactly holding his breath on results.

“Listen, when you’re dealing with a bureaucracy, You’ve always got to figure that lethargy takes place, and they don’t do anything in much of a hurry,” says Grassley. “We have to keep on them with phone calls, and with letters, and whatever we can do to keep the pressure on. But the bottom line of it is, this additional missile that we’re sending them is some additional pressure.”

In the letter, Grassley and Klobuchar request that the DOJ and FTC review the claims of the RFA and respond with a substantive evaluation of their conclusions, and any proposed solutions to resolve the issue, should anti-competitive behavior present itself.

Grassley’s letter is reproduced below. You can hear more about Grassley’s strategy to tackle possible anti-compteitive behavior by clicking here.

July 17, 2014

The Honorable Eric Holder
Attorney General
United States Department of Justice
950 Pennsylvania Avenue, NW
Washington, DC 20530

The Honorable Edith Ramirez
Chairwoman
Federal Trade Commission
600 Pennsylvania Avenue, NW
Washington, DC 20580

Dear Attorney General Holder and Chairwoman Ramirez:

In August of 2013, we contacted you both to express our concerns regarding oil companies that seemed to be engaging in anticompetitive practices aimed at blocking market access for renewable fuels. As you may recall, the Energy Independence and Security Act of 2007 (EISA) created the Renewable Fuel Standard (RFS) to promote the development and use of domestic renewable fuel. Our previous letter to you expressed our concern that oil companies were taking steps to undermine the efforts to distribute renewable fuels, and were doing so to undermine the RFS and bolster their desire to see the law repealed.

Since our last letter, the concern regarding anticompetitive behavior by oil companies has grown. Just last week, the Renewable Fuels Association (RFA), a trade association representing the U.S. ethanol industry, released a comprehensive analysis detailing how some oil companies block the sale of renewable fuels. The report from the RFA found that unbranded or independent stations are roughly four to six times more likely to offer E85 and 40 times more likely to offer E15 than stations carrying a “Big Five” oil brand. The report provides a series of tactics some oil companies use to prevent or discourage the sale of renewable fuels. We have attached a copy of the RFA study to this letter.

We ask that the DOJ and the FTC review the RFA report, investigate the claims and findings included in it, and reply to us with a substantive evaluation of your conclusions regarding possible anticompetitive behavior by certain oil companies and any proposed solutions or actions the DOJ and FTC will take to resolve this issue. We look forward to hearing from you on this matter.

Sincerely,

________________________________ ________________________________
Senator Chuck Grassley Senator Amy Klobuchar