EPA Denies Texas' Request for Ethanol Waiver

The Environmental Protection Agency has denied a request from Texas to temporarily reduce ethanol requirements for gasoline in hopes of bringing down corn prices.

Gov. Rick Perry called the decision "a mistake" and "bad public policy."

EPA Administrator Stephen Johnson spoke to Perry about his waiver request by phone Thursday, shortly before Johnson was to announce the agency's decision publicly, said the governor's spokeswoman, Allison Castle.

A federal energy bill passed in December requires that 9 billion gallons of ethanol be blended into gasoline from Sept. 1 to Aug. 31, 2009. Perry asked the EPA in April to drop the Renewable Fuels Standard requirement to 4.5 billion gallons, saying demand for ethanol is raising corn prices for livestock producers and driving up food prices.

"I am greatly disappointed with the EPA's inability to look past the good intentions of this policy to see the significant harm it is doing to farmers, ranchers and American households," Perry said. "For the EPA to assert that this federal mandate is not affecting food prices not only goes against common sense, but every American's grocery bill."