The Renewable Fuels Association (RFA) recently asserted that the ethanol industry has higher rates of unionization than the refining sector—but a closer look at the facts reveals quite the opposite, and in dramatic fashion. In reality, the numbers demonstrate why the Biden Administration needs to fix the Renewable Fuel Standard (RFS) to protect union jobs (which are, in fact, practically non-existent throughout the ethanol industry).
RFA’s January 21st tweet quotes an Energy Futures Initiative report erroneously claiming the “petroleum fuels” industry is only 2 percent unionized, compared to 7 percent for the ethanol sector. But before we unpack that erroneous claim – which is founded upon a misguided definition of “petroleum fuels” that includes at least five different industries, including retailers that lobby alongside the biofuel sector in opposition to sensible RFS reforms – let’s just take a look at the numbers the RFA has decided to hang their hat on.
The very same report that RFS cites notes there are 2,537 union employees in the “ethanol fuels industry,” versus 12,289 in the “petroleum fuels industry.” In other words, their own wrong numbers indicate the so-called “petroleum fuels” industry has six times more union workers than the “ethanol fuels industry.”
But then again, those numbers are completely wrong. This graphic highlights how the report defines “petroleum fuels” industry.
This definition of “petroleum fuels” includes the entire possible supply chain along which oil travels, regardless of whether it is refined into transportation fuels and incurs an RFS obligation.
This definition includes jobs in upstream production all the way down to your neighborhood gas station clerk and everyone between, such as truck drivers and terminal operators. Each bar essentially represents an entirely different industry, only one of which – petroleum fuels refining, which is highlighted under the green arrow above and only one part of the “manufacturing” segment – has to comply with the RFS. Independent refiners pushing for sensible RFS reform are pure play refiners that have no affiliation with upstream oil production businesses or fuel retail outlets. In fact, the “wholesale, trade, distribution and transport” sector (noted under the red arrow above) includes large retailers, as well as speculators that trade unregulated RFS compliance credits called Renewable Identification Numbers (RINs), that lobby WITH the biofuel industry against commonsense RFS reforms that would protect union refining jobs and domestic fuel supplies. RFA correctly notes those groups – aligned with RFA – are predominantly non-union.
A closer look at the refining industry alone highlights how much more extensively unionized the sector is compared to the ethanol industry. IMPLAN data indicates there are about 69,500 people working directly in American refineries. In comments supporting Governors’ requests to partially waive the RFS requirement to avoid severe economic harm, the United Steelworkers (USW) noted: “The USW represents working people across multiple sectors, including approximately two thirds of domestic petroleum refining, accounting for 30,000 high wage, community supporting jobs at over 75 locations across the country.”
Using USW’s numbers, their 30,000 members in the refining industry represent over 43 percent of total refining workers—a percentage that’s six times greater than the seven percent unionization RFA touts for the ethanol sector. Put another way, USW’s numbers indicate the refining sector directly employs over 27,000 more union workers than the ethanol industry. And that only accounts for USW membership.
The truth about each sector’s workforce does not stop with USW’s membership. None of these numbers account for the thousands of jobs refinery construction and maintenance regularly provides to the building and construction trades unions. RFA’s contrived numbers also fail to reflect the fact that building and construction work is almost non-existent in the ethanol sector. Not only are union construction jobs lacking in the ethanol sector, but the industry is actively fighting unionization efforts being advanced in Illinois and various other states.
This is why union members are constantly calling for RFS reforms. Take it from leaders in organized labor groups themselves—below are just a few quotes from various comments and letters urging the administration to fix the Renewable Fuel Standard:
“As you know, the domestic merchant refining industry provides union construction workers with thousands of steady high-paying jobs. When refineries invest in new capital or major maintenance projects, they typically employ thousands of additional skilled craft workers. However, wildly volatile and excessive RIN prices have curtailed many of these multi-million dollar projects.” - NABTU letter to Administrator Regan, June 2, 2021
“It is important to note that merchant refiners in the Northeast specifically represent the dominant source of man hours for UA members and other building construction trades members.” - Mark McManus, UA (Pipefitters) General President, January 25, 2018
“The domestic refining industry provides our members with thousands of high paying jobs. When refineries invest in major projects or maintenance projects, known as turnarounds, they typically employ an additional 1,000 or more skilled craft workers.” - Newton B. Jones, International President, International Brotherhood of Boilermakers, March 12, 2018.
“[Refinery] work represents 400,000 to 1,000,000 manhours per year, which equates to a minimum $16,000,000 income to our local economy.” - Shaun Enright, Executive Secretary, Northwest Ohio Building Trades Council, August 15, 2018.
The facts are clear: Runaway RIN costs are putting thousands of union refining jobs at risk. Fixing that problem will not have any impact on the ethanol industry—not just because union jobs are lacking in the sector, but also because the facts make clear there is no correlation in RIN prices and the amount of biofuel blended into the fuel supply.
We thank RFA for the opportunity to reveal their ongoing efforts to undermine the organized labor movement while emphasizing the extensive union membership among independent refiner workers.