In the News
Sep 28, 2020
As Congress and the administration continue negotiations on another potential COVID-19 relief package, a new study by university economists finds that ethanol producers will experience roughly $8 billion in losses this year due to the pandemic’s impact on world fuel markets. The study, conducted by economists from the University of Florida and Arizona State University, was published recently in the Journal of Agricultural & Food Industrial Organization.
“The COVID-19 pandemic in 2020 had a major negative impact on U.S. ethanol, gasoline, and oil prices and production,” the authors found. “COVID-19 has had a major impact on ethanol production. The producer loss due to COVID-19 is $7 billion.”
The estimated economic loss grows to a range of $7.9 to $8.6 billion when unemployment effects are included. The authors acknowledge that those estimates likely “understate the cost of COVID-19” to the ethanol industry because the impact of the pandemic on co-product output, demand and prices is not included.
Renewable Fuels Association President and CEO Geoff Cooper said the new study corroborates the findings of an RFA analysis published in July, which found pandemic-related losses could be $7 billion or more in 2020. According to RFA, the study also underscores the importance of ensuring ethanol producers are not again left out of any stimulus package that may move forward in the weeks ahead.
“This new, independent study confirms what has already been made painfully clear to the 350,000 men and women whose jobs are supported by the ethanol industry,” Cooper said. “The COVID-19 pandemic caused fuel demand to plummet and forced scores of ethanol plants to shut down, resulting in steep economic losses for the industry. While market conditions have improved since the spring, the ethanol industry is still struggling to fully recover from the pandemic, and ethanol producers across the country remain under financial stress.”
Cooper urged lawmakers and the administration to ensure emergency relief for ethanol producers is included in any forthcoming coronavirus aid deal.
“There is strong bipartisan support for providing assistance to renewable fuel producers in both the House and Senate,” Cooper said. “The HEROES Act passed by the House in May included emergency relief provisions for ethanol producers, and a similar measure was introduced in the Senate by Sens. Grassley and Klobuchar. We remain hopeful that a fourth COVID-19 aid package, with emergency relief for ethanol producers, will finally be pushed over the goal line in the weeks ahead.”
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Sep 24, 2020
Rep. Cheri Bustos, D-Ill., on Sept. 24 introduced the Next Generation Fuels Act, a bill that establishes a minimum octane standard for gasoline and requires sources of added octane value to reduce carbon emissions by at least 30 percent when compared to baseline gasoline. The bill would also limit the use of harmful aromatics in meeting the new high-octane standard, as well as in current-market gasoline.
To accomplish its goals, the legislation would require the U.S. EPA to create a new 98 research octane number (RON) standard, limit reliance on toxic aromatic hydrocarbons, and update fuel and infrastructure regulations to expand the availability of mid-level ethanol blends. It would ensure parity in the regulation of gasoline volatility, correct the R-factor used in fuel economy testing, provide for an E30 fuel waiver, replace the EPA’s flawed MOVES model, and restore meaningful credit toward compliance with fuel economy and emissions standards for the production of flex fuel vehicles.
“For the last three and a half years, we have been forced to fight battle after battle and face this Administration’s broken promise after broken promise to ensure our country is meeting the full potential of biofuels,” Bustos said. “The Next Generation Fuels Act looks toward the future to make sure we bring an environmental lens to biofuels production, in order to increase demand while reducing carbon emissions.”
Representatives of the biofuels industry have spoken out in support of the bill.
Growth Energy is applauding Bustos for her push for high-octane, low carbon fuels. “There has never been a more urgent need to adopt higher octane, low-carbon ethanol blends in America’s fuel supply, as they are key to achieving clean, healthy air,” said Emily Skor, CEO of Growth Energy. “We applaud Congresswoman Bustos for charting a path forward that will unleash clean, affordable ethanol to drive decarbonization in our nation’s transportation fleet and save consumers money at the fuel pump.”
The Renewable Fuels Association called the bill the beginning of an exciting new era in transportation fuels policy. ““The Next Generation Fuels Act of 2020 provides a bold and innovative approach to reducing carbon emissions, improving engine efficiency and performance, protecting human health, and removing the arcane regulatory roadblocks that have hindered the expansion of cleaner, greener liquid fuels,” said Geoff Cooper, president and CEO of the RFA. “By establishing the roadmap for an orderly transition to high-octane, low-carbon fuels, this landmark legislation begins an exciting new era in transportation fuels policy. As the world’s top supplier of clean, affordable, low-carbon octane, the U.S. ethanol industry proudly and enthusiastically supports this legislation. We thank Rep. Bustos for her thoughtful leadership and determined efforts to craft and introduce this bill, and we look forward to working together to make this bold vision a reality.”
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Sep 22, 2020
“Because of the price of oil collapsing and people not driving…and also these waivers that have been given out by the administration, which should have never been considered,” Peterson said during the Agri-Pulse Ag and Food Policy Summit on Monday. “If we had 15 billion gallons we wouldn’t be having the kind of problems we’re having in the ethanol industry.”
Peterson would like to see producers receive 45 cents a gallon based on their January to April production, or from 2019 if they were shut down. “And that needs to happen too or we’re going to lose some of these plants.” he said.
However, the chairman from Minnesota expressed concern that getting back into the habit of ad hoc disaster aid for agriculture could be detrimental to farm policy going forward.
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Sep 16, 2020
Novozymes today announced the launch of Fiberex®, a comprehensive platform based on novel enzymes and yeast strains to convert corn fiber into ethanol. Fiberex® is specifically aimed at breaking down tough fibers in the corn, providing producers with greater operational flexibility. The technology converts a low-value by-product into high-value, low-carbon fuel while also enabling the production of significantly more corn oil. "Through advanced biology, biofuel producers looking to diversify can now unlock new markets and avenues of profitability,” says Brian Brazeau, Novozymes’ vice president for bioenergy. “Working with Novozymes and our expert analytics and engineering partners, producers can use Fiberex® technology to transform their corn fiber, typically only used for animal feed, into low-carbon, high-value cellulosic ethanol.” Novozymes is the technology leader in fiber conversion today, enabling new revenue for biofuels producers from low-carbon credits such as in California and EPA’s cellulosic RIN credits. Through Fiberex®, Novozymes is collaborating with the biofuel industry to further expand the boundaries of corn-based ethanol – literally breaking down some of the barriers between what is considered conventional biofuels and advanced biofuels.
Converting more of the tough feedstock
Low-carbon fuels are a crucial part of transportation – enabling domestic energy, a cleaner environment, and better livelihoods for rural America and beyond. Most ethanol is made from the starch in corn kernels, whereas the fiber is much more difficult to use, being a complex matrix consisting of cellulose, hemicellulose, starch, protein, oil, and minerals. The cellulose is rigid and partially crystalline in form while the hemicellulose is highly branched and amorphous. Novozymes’ Fiberex® enzymes are specifically designed to break down this complex matrix – resulting in more corn oil and converting the fiber into simple sugars that are easily converted into ethanol. “Ethanol producers know their business best! We now make available industry-leading technology and are putting our bioinnovation in top gear to convert every last pound of fiber in corn,” says Brian Brazeau. “Realizing the importance of fiber-based ethanol in reducing our carbon footprint, improving co-products, and increasing value for producers, we have embarked on a mission to develop biology that can convert all of this tough feedstock into low-carbon ethanol. It is time to reimagine ethanol.” As part of the platform announcement, Novozymes is also launching the first Fiberex® products: Fiberex R1, a technology specifically designed to provide maximum ethanol in separate fiber-to-ethanol processes, and Fiberex F1, a cellulase enzyme designed to provide fiber conversion for in-process technologies. Additional solutions, to launch in 2021, are in proof-of-concept trials now. More information on Fiberex® can be found here.
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Sep 15, 2020
(Washington, D.C.) - Today, the House Committee on Energy and Commerce released the text of legislation containing the provisions of House Agriculture Committee Chairman Collin Peterson’s Renewable Fuel Standard Integrity Act. The House is expected to consider H.R. 4447 the week of September 21st.
“In recent years, the Environmental Protection Agency has granted dozens of small refinery exemptions, waiving billions of gallons of biofuel from RFS blending requirements. The Agency granted these harmful waivers with little transparency, concealing details from the public about which refiners are being granted waivers and why. The provisions of my bill will require EPA to pull back the curtain and show the American people how they justify granting these waivers that have greatly impacted profitability for biofuels producers and farmers across the country.”
The provisions included in H.R. 4447, Clean Economy Jobs and Innovation Act would set an annual deadline for refiners to request exemptions from the Renewable Fuel Standard and require EPA to publicly release the name of refiners requesting a waiver, the number of gallons requested to be waived and the number of gallons of biofuel that will not be blended as a result of the waiver. These provisions mirror the provisions of H.R. 3006, the Renewable Fuel Standard Integrity Act, with adjustments to address business confidentiality concerns that were raised by members of the House Committee on Energy and Commerce.
Congressman Peterson is a co-chair of the Congressional Biofuels Caucus, a bipartisan group of Members of Congress who advocate for homegrown renewable fuel policies that boost farmer incomes and reduce dependence on foreign oil.
Read the original press release here.
Lallemand Biofuels & Distilled Spirits
Sep 14, 2020
Lallemand Biofuels & Distilled Spirits (LBDS), a global supplier of innovative fermentation ingredients, is proud to announce the introduction of their next generation advanced yeast and enzyme platform called ConvergenceTM.
The ConvergenceTM platform has been developed to generate increased profitability for North American biofuel producers by providing a step change improvement in ethanol production cost economics. The platform combines a new yeast that generates virtually all the glucoamylase (GA) required for fermentation combined with a small amount of complementary exogenous enzyme.
ConvergenceTM has been created through the development of new biotechnology that enables yeast strains to express much higher levels of GA than was previously possible. Now all of the enzymes required for fermentation can be delivered through two components:
TransFerm® CV5 is a genetically modified yeast strain that combines best in industry yield enhancement technology with extraordinary levels of glucoamylase and trehalase expression. This yeast generates between 80% and 100% of the enzymes required in fermentation.
Alcolase® 146 is a high-performance glucoamylase blend developed to maximize the fermentation performance of TransFerm® CV5. This product provides optimal results at a significantly lower dose than other commercial enzyme blends. When used with TransFerm® CV5 it is supplied at no extra charge.
“We are very excited to introduce the Convergence platform this week. Ethanol producers now have an alternative to purchasing expensive exogenous fermentation enzymes from traditional enzyme suppliers” says Angus Ballard, President of LBDS. “TransFerm® CV5 continues our tradition of developing innovative solutions that generate real value for our customers. We look forward to continuing this approach in the years ahead.
For additional information on the ConvergenceTM line of products, please see the Lallemand Biofuels web site at www.lbds.com or contact your local sales or technical presentative.
About Lallemand Biofuels & Distilled Spirits
Lallemand Biofuels & Distilled Spirits (LBDS), based in Milwaukee, WI, GA is a business unit of the Canadian yeast and bacteria producer Lallemand Inc. LBDS is a leading supplier of fermentation ingredients and value creating services to the global fuel ethanol and distilled spirits markets. For more information please visit www.lbds.com.
Read the original press release here.
Sep 10, 2020
The chairman of the House Agriculture Committee is eagerly awaiting confirmation on two major issues affecting the biofuels industry.
Minnesota Congressman Collin Peterson says the first involves President Trump reportedly directing EPA to deny dozens of so-called “gap year” small refinery exemption requests.
“That’s great, but we have not verified that. We haven’t actually seen that in writing at the EPA or anyplace else. I hope that’s true, and I hope the President sticks with that and this is not just some kind of rhetoric to get past the election. And then after the election, it goes away.”
During a Minnesota Renewable Energy virtual roundtable Thursday, Peterson was asked (by Brownfield) about Brazil agreeing to suspend its 20 percent tariff on U.S. ethanol imports for 90 days.
“Again, we have not been able to confirm this, these are the rumors. And in both of these cases, they’re quoting anonymous sources. The people say they want to be anonymous so they can speak freely, but we don’t know exactly what this means. So I hope that’s true.”
Peterson says while these are positive signals, Congress has not seen anything official on gap year waivers or Brazil’s ethanol tariffs.
Read the original story here.
Sep 4, 2020
A boom in demand for hand sanitizer in South Korea since the outbreak of COVID-19 is not shocking, but the related jump in U.S. ethanol imports to the country to meet that need may be more surprising. This uptick in demand is opening doors for the U.S. Grains Council (USGC) and partners to build new partnerships to expand demand potential for ethanol across Asia both for industrial uses and fuel.
“The COVID-19 pandemic has altered ethanol markets around the world,” said Haksoo Kim, USGC director in South Korea. “The demand for U.S. ethanol for industrial use in South Korea has increased significantly due to high demand for sanitizing products in South Korea and throughout the region.
“Despite these short-term impacts, fuel ethanol demand remains viable for expansion in the future, and the council is working to increase market access in individual countries in the region,” Kim said.
Domestic demand for hand sanitizer in Korea is now 2.6 million gal. per month, more than 12 times pre-pandemic levels. The country had already been importing U.S. ethanol for industrial uses like windshield wiper fluid and disinfectants, but increased demand has led to more purchases.
South Korea imported 58.9 million gal. of U.S. ethanol (20.9 million bu. in corn equivalent) for industrial uses from January to July 2020, up nearly 53% year over year. This level constitutes a 55% market share, with competition primarily from Brazil, China and Pakistan.
USGC met virtually on Aug. 24 with KC&A, the largest U.S. ethanol importer and distributor in Asia, to discuss the obstacles and opportunities for export expansion in the region. The company has the only facility in South Korea that can rectify -- or distill to remove water and other compounds -- ethanol for use in sanitizing products. The company’s operations in the port city of Ulsan are also well placed to take advantage of transshipment opportunities to other Asian countries.
Representatives from three USGC offices -- the Washington, D.C., headquarters office; the Southeast Asia regional office in Kuala Lumpur, Malaysia, and the South Korea office -- all participated in the meeting. The council and KC&A discussed how to work together to introduce and expand fuel ethanol policies in the region and capitalize on logistical advantages.
“The council and KC&A worked to increase our understanding of the changing ethanol markets in the United States, South Korea and Southeast Asia,” Kim said. “By sharing information and knowledge, we will cooperate to expand and develop ethanol markets in the region.”
While fuel demand remains down due to COVID-19, USGC has advocated for revisions in government policies that permit ethanol for fuel use and provide a role for trade.
In Indonesia, the council worked with Growth Energy, the Renewable Fuels Assn. and the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS) to remove a ban on ethanol entering the country. U.S. ethanol can now enter the Indonesian market by way of pre-blended fuel.
In Vietnam, USGC worked with FAS to engage Vietnam's Ministry of Industry & Trade and Ministry of Finance to reduce most-favored nation tariffs, which are the lowest possible tariffs a country can assess on another country with this status. While the council and its partners pushed for a tariff reduction in line with competing products like aromatics and other petrochemical oxygenates, the tariff was eventually reduced to 15% for both 100% pure ethanol and 99% or less pure ethanol -- the maximum reduction applied to any commodity or product during this review period.
The council said it will continue to expand public and private partnerships like these to help U.S. ethanol meet the shifting demand needs in Asia and the rest of the world.
Read the original story here.
More...
Sep 3, 2020
The U.S. exported 74.04 million gallons of ethanol and 1.08 million tons of distillers grains in July, according to data released by the UDSA’s Foreign Agricultural Service on Sept. 3. Ethanol exports for the period were down, while distillers grains exports were up.
The 74.04 million gallons of ethanol exported in July was down from 78.49 million gallons exported in June and 122.33 million gallons exported in July 2019.
The U.S. exported ethanol to approximately three dozen countries in July. Canada was the top destination for U.S. ethanol with 30.08 million gallons, followed by India with 13.02 million gallons and the Netherlands with 7.93 million gallons.
The value of U.S. ethanol exports fell to $131.77 million in July, down from $185.63 million during the same month of 2019 and down from $143.67 million in June.
The U.S. exported a total of 804.76 million gallons of ethanol during the first seven months of 2020 at a value of $1.41 billion, compared to 883.84 million gallons at a value of $1.4 billion exported during the same period of last year.
The 1.08 million tons of distillers grains exported in July was up from both the 883,193 tons exported in June and the 856,767 tons exported in July 2019.
The U.S. exported distillers grains to approximately 33 countries in July. Mexico was the top destination with 162,234 tons, followed by Turkey with 143,765 tons and Thailand with 141,749 tons.
The value of U.S. distillers grains exports reached $227.86 million in July, up from $194.7 million in June an d$174.38 million in July 2019.
Total U.S. distillers grains exports for the first seven months of 2020 reached 6.06 million tons at a value of $1.3 billion compared to 6.21 million tons at a value of $1.3 billion during the same period of last year.
Additional data is available on the USDA FAS website.
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Sep 2, 2020
Highwater Ethanol LLC, a 59 MMgy ethanol plant located in Lamberton, Minnesota, filed an 8-K with the U.S. Securities and Exchange Commission on Sept. 1 announcing an agreement with Nelson Baker Biotech Inc. for the installation of a system to produce 20 MMgy of hydrous USP grade ethanol, which is used in the sanitizer market.
The filing indicates Highwater and Nelson Baker executed the construction agreement on Aug. 26. The agreement provides for a fixed price, which includes design, engineering and construction management.
Construction is expected to begin before the end of the current fiscal year, which ends Oct. 31. The project is expected to be complete during the second fiscal quarter of 2021.
A full copy of the 8-K is available on the SEC website.
Read the original story here.
Aug 28, 2020
The USDA recently released its Grain Crushings and Co-Products Production report for August, reporting that corn use for fuel ethanol production was at 379 million bushels in June, up from the previous month, but down from June 2019.
Total corn consumed for alcohol and other uses was 431 million bushels in June, up 22 percent from May, but down 15 percent from June of the previous year. June usage included 90.8 percent for alcohol and 9.2 percent for other purposes.
Corn consumed for fuel alcohol was at 379 million bushels, up 26 percent from the previous month, but down 17 percent when compared to June 2019. Corn consumed in June for dry milling fuel production and wet milling fuel production was 89 percent and 11 percent, respectively.
Sorghum consumption for fuel alcohol production fell to 1.286 million hundredweight (cwt) (72,016 tons) down from 2.047 million cwt in May and 4.918 million cwt in June 2019.
At dry mills, condensed distillers solubles production was at 86,233 tons, up from 81,971 tons in May, but down from 97,365 tons in June 2019. Corn oil production was at 135,676 tons, up from 104,898 tons in May, but down from 164,266 tons the same month of the previous year. Distillers dried grains production was at 268,201 tons, up from 205,750 tons in May and 369,394 tons in June 2019. Distillers dried grains with solubles production was at 1.66 million tons, up from 1.23 million tons the previous month, but down from 1.96 million tons in June 2019. Distillers wet grains production was at 824,313 tons, up from 242,264 tons in May, but down from 391,650 tons in June of the previous year. Modified distillers wet grains production was at 309,981 tons, up from 242,264 tons in May, but down from 391,650 tons in June 2019.
At wet mills, corn germ meal production was at 65,113 tons, up from 64,200 tons in May, but down from 66,291 tons in June 2019. Corn gluten feed production increased to 294,074 tons, up from 291,064 tons the previous month and 286,101 tons in June 2019. Corn gluten meal production fell to 90,257 tons, down from 91,013 tons in May and 92,107 tons in June 2019. Wet corn gluten feed production was at 244,097 tons, up form 224,695 tons in May, but down from 250,826 tons in June 2019.
At wet and dry mills, carbon dioxide captured was at 184,413 tons in June, up from 149,453 tons the previous month, but down from 260,283 tons in June 2019.
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Aug 27, 2020
The U.S. EPA has released renewable identification number (RIN) data for July, reporting that 1.62 billion RINs were generated during the month under the Renewable Fuel Standard, up from 1.51 billion RINs generated in June.
More than 40.63 million D3 cellulosic biofuel RINs were generated in July, including 30.89 million generated for compressed renewable natural gas (RNG) by domestic producers, 6.79 million generated for liquified RNG by domestic producers, 1.88 million generated for compressed RNG by importers, 809,299 generated for liquefied RNG by importers, and 256,193 generated for cellulosic ethanol by domestic producers.
Total D3 RIN generation for the first seven months of 2020 reached 223.85 million. That volume includes 177.93 million generated for compressed RNG by domestic producers, 37.73 million generated for liquefied RNG by domestic producers, 9.85 million generated for RNG by importers, 7.04 million generated for compressed RNG by importers, and 1.11 million generated for cellulosic ethanol by domestic producers.
More than 382.23 million D4 biomass-based diesel RINs were generated in July, including 243.78 million generated for biodiesel by domestic producers, 72.96 million generated for nonester renewable diesel by domestic producers, 36.44 million generated for nonester renewable diesel by foreign entities, 26.59 million generated for biodiesel by importers, and 2.46 million generated for renewable jet fuel by domestic producers.
Total D4 RIN generation for the first seven months of the year reached 2.48 billion. That volume includes I.52 billion generated for biodiesel by domestic producers, 482.62 million generated for nonester renewable diesel by domestic producers, 299.46 million generated for nonester renewable diesel by foreign entities, 173.38 million generated for biodiesel by importers, and 5.76 million generated for renewable jet fuel by domestic producers.
Nearly 28.79 million D5 advanced biofuel RINs were generated in July, including 22.04 million generated for ethanol by importers, 3.15 million generated for naphtha by domestic producers, 1.8 million generated for ethanol by domestic producers, 1.26 million generated for nonester renewable diesel by domestic producers, 458,114 generated for LPG by domestic producers, 65,164 generated for renewable heating oil by domestic producers, and 10,378 generated for compressed RNG by domestic producers.
Total D5 RIN generation for the first seven months of 2020 reached 141.74 million. That volume includes 66.36 million generated for ethanol by importers, 38.45 million generated for nonester renewable diesel by domestic producers, 16.91 million generated for naphtha by domestic producers, 13.44 million generated for ethanol by domestic producers, 1.46 generated for renewable heating oil by domestic producers, 2.04 million generated for LPG by domestic producers, and 34,676 generated for compressed RNG by domestic producers.
Nearly 1.17 billion D6 renewable fuel RINs were generated in July, including nearly 1.17 billion generated for ethanol by domestic producers, 831,504 generated for nonester renewable diesel by foreign entities, and 572 generated for butanol by domestic producers.
Total D6 RIN generation for the first seven months of the year reached 7.28 billion. That volume includes 7.19 billion generated for ethanol by domestic producers, 91.37 million generated for nonester renewable diesel by foreign entities, 5.43 million generated for ethanol by importers, and 572 generated for butanol.
No D7 cellulosic diesel RINs have been generated so far this year.
According to EPA data, total RIN generation for the first seven months of 2020 was more than 10.14 billion, compared to 11.45 billion generated during the same period of last year.
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Aug 25, 2020
Democratic presidential nominee Joe Biden on Aug. 25 issued a statement describing his commitment to the Renewable Fuel Standard and criticizing the Trump Administration’s administration of the program.
“Instead of standing with those who till our land and sow our fields, we have a president who has sold out our farmers by undercutting the Renewable Fuel Standard with the granting of waivers to Big Oil,” Biden said. “Those waivers severely cut ethanol production, costing farmers income and ethanol plant workers their jobs. Now, President Trump refuses to announce the 2021 renewable fuel production levels until after the election, leaving farmers concerned of further cuts to production. The Renewable Fuel Standard marks our bond with our farmers and our commitment to a thriving rural economy. Donald Trump doesn't respect that connection, and he's thrown it away to the detriment of generations of producers across the Midwest and around the country—many of whom put their trust in him four years ago.
“The Obama-Biden Administration kept our word to farmers,” he continued. “A Biden-Harris Administration will promote and advance renewable energy, ethanol, and other biofuels to help rural America and our nation’s farmers, and will honor the critical role the renewable fuel industry plays in supporting the rural economy and the leadership role American agriculture will play in our fight against climate change.”
A Renewable Fuels Association spokesperson said the group is encouraged that the Biden campaign is hearing concerns about small refinery exemptions (SREs) and noted the RFA was able to discuss the issue last week at its welcome event during the NDC’s Leaders of American Agriculture virtual symposium.
Read the original story here.
Aug 25, 2020
The Senate Democrats' Climate Committee released a new report on Aug. 25 that details how climate action by Congress can create new jobs and grow the U.S. economy. Biofuels and bioenergy are among the topics discussed.
The 263-page report specifically calls on Congress to achieve 100 percent global net-zero emission by 2050, stimulate economic growth by increasing federal spending on climate action to at least 2 percent of gross domestic product (GDP) annually, and create at least 10 million new jobs.
In the near-term, the report calls on the U.S. to significantly grow solar and wind energy, energy storage, and electric vehicles while conducting more research into new technologies, advanced biofuels and smaller and safer nuclear power.
One section of the report specifically discusses opportunities associated with the bioeconomy. “The United States can create and expand the economic value and market for agricultural products while reducing the use of fossil fuels, because byproducts of agricultural commodities and other natural waste products can be processed into biobased fuels and chemicals that replace fossil fuel-based products,” the committee wrote. “The growing biobased products industry contributes $393 billion and 4.2 million jobs to the American economy. These products have helped the United States transition away from foreign fossil fuels, generating a 19- 48 percent reduction in emissions when switching from petroleum gasoline to corn-based ethanol for transportation. Many of the bio-based alternatives to fossil fuel-derived chemicals are also less hazardous to human and environmental health; transitioning to them reduces risks to workers, costs associated with handling hazardous chemicals, and long-term contamination passed on to future generations. Additionally, opportunity exists in developing bioproducts that can improve the performance of manmade materials. For example, cellulosic nanomaterials derived from woody biomass can be mixed into concrete and other products to add strength and durability. These technologies offer a significant economic opportunity for farmers and managers of working lands, as well as their rural communities.”
While the federal government has invested in research and development of these products for years, the committee stresses that regulatory uncertainty and market volatility create barriers to private sector investment in advanced biofuels, such as cellulosic ethanol. The committee calls for increased federal funding for research, development and demonstration of advanced biofuels and biobased products from waste products and non-food crops, noting those efforts could significantly accelerate the adoption of advanced biofuels and bioproducts in American commerce, thereby lowering emissions in the transportation, electric and industrial sectors.
“We need a stable framework that accounts for the climate and ecosystem benefits of these fossil fuel alternatives—and passes this value on to farmers and advanced biofuel producers,” the committee wrote. “This would promote the sustained investment necessary to develop the next generation of these products and accelerate their use by consumers and industry. But as this sector grows, we must focus on increasing productivity on each parcel of land, while protecting high-worth conservation areas.”
The report also addresses the potential of on-farm anaerobic digestion (AD) projects. While AD projects have been piloted and deployed over the past two decades, the report notes that their widespread use has been stymied by technical challenges, shifting regulatory climates, and energy prices that did not cover the costs of operation.
“For methane digester systems to be financially viable and truly beneficial to reaching climate goals, farmers must be compensated for capturing methane from their herds,” the committee wrote. “This could be achieved by incorporating the added value of the renewable fuel into its price, resulting in additional income and reduced emissions. Additionally, we must make using them less risky, more practical, and increasingly reliable. Biogas companies are actively innovating in how digesters are owned and operated, which may attract farmers who otherwise would not be willing to host a digester on their farm. To take advantage of the emissions capture potential in this technology, financial incentives should be provided to help with the costs of getting a digester up and running smoothly. These upfront costs can be prohibitive to farmers without assistance, but represent relatively modest investments compared to other emissions sequestration strategies.”
In the electric sector, the report stresses the U.S. needs to develop ways to reduce the price of on-demand, low-carbon generators, such as biomass, geothermal, advanced nuclear, or fossil generation paired with carbon capture and storage (CCS). The committee highlights the potential of biomass power paired with CCS, noting it could potentially contribute to net-negative carbon emission electrical generation.
The report also addresses the potential of CCS paired with advanced and cellulosic biofuels in the liquid fuels sector, stressing that those renewable fuels have the potential to serve as alternatives to fossil fuels if the U.S. continues to invest in their development.
Regarding the Renewable Fuel Standard, the committee notes the use of advanced biofuels has not developed as rapidly as the authors of the RFS envisioned. “This is at least in part because the Trump administration continues to lower biofuel volumes and waive blending requirements under the RFS, jeopardizing the market stability that the RFS was intended to create,” the committee wrote in the report. “New policy tools may be needed to encourage growth of new advanced fuels beyond just corn starch ethanol and soybean biodiesel.”
According to the committee, a federal Low Carbon Fuel Standard may be an effective policy to reduce the carbon intensity of the fuel supply. The report cites the California LCFS as helping to avoid 38 million tons of carbon pollution and the use of 13.7 billion gallons of gasoline to date.
Growth Energy, the Renewable Fuels Association and the American Coalition for Ethanol have spoken out to welcome the inclusion of biofuels in the committee’s climate plan.
“Investments in American biofuels continue to pay dividends for our climate, driving down carbon emissions and replacing toxic fuel additives that poison our air,” said Emily Skor, CEO of Growth Energy. “We’re pleased to see climate leaders in the Senate examining opportunities to accelerate progress toward a carbon-neutral future by opening the door for cleaner low-carbon biofuels, more green jobs, and continued innovation in renewable bioproducts to replace petroleum. It’s encouraging to see a growing chorus of lawmakers ready to harness the full potential of biofuels to decarbonize our transportation sector, open new doors for agricultural innovation, and break down regulatory barriers holding back production of advanced biofuels.”
“We are glad to see Senate Democrats recognize that renewable fuels like ethanol have an important part to play in our nation’s low-carbon future,” said Geoff Cooper, president and CEO of the RFA. “We are pleased to see the Committee acknowledge the role the Renewable Fuel Standard has already played in reducing emissions and we welcome the report’s discussion of a potential national Low Carbon Fuel Standard (LCFS). This report complements the House Select Committee’s recommendations in June, and it is clear that consensus is building around the need to further reduce GHG emissions from the transportation sector.”
“ACE has been laying the strategic groundwork necessary to leverage ethanol’s low carbon value in the market through new clean fuel policy solutions at the state and federal level,” said Brian Jennings, CEO of ACE. “We appreciate the Senate Committee acknowledging the significant role alternative liquid fuels could play in reducing the carbon intensity of the transportation sector and our reliance on petroleum, as well as the need for new policy tools like a Low Carbon Fuel Standard due to improper implementation of the RFS in recent years.”
A full copy of the report can be downloaded Senate Democrats Climate Committee’s website.
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Aug 21, 2020
The agency has received another nine new small refinery exemption requests for previous years, along with three new current waiver petitions for 2019-2020. The prior year petitions include one each for 2011 and 2012, two each for the years 2013 through 2015, and a new one for 2016. That brings the total requests for so-called “gap year” waivers to 67 – all of which have been filed since the 10th Circuit Court decision in January which struck down a set of waivers granted because they were not direct extensions of ones previously granted, as required by law.
Renewable Fuels Association (RFA) president and CEO Geoff Cooper says it is past time for President Trump to intervene. “As more and more waiver requests pile up, we are again asking the President to ensure EPA immediately adopts the recent Tenth Circuit court decision nationwide and rejects these nonsensical gap-year petitions, Cooper said. “The Saudi-Russia oil price war, COVID pandemic, ongoing trade war, and now a historic derecho have already taken a devastating toll on our markets, and faithful enforcement of the Renewable Fuel Standard is more important now than ever before.”
“This week in Iowa, President Trump promised to personally speak with EPA about these absurd gap-year waivers and the impact they are having on ethanol producers and the farm economy. That conversation can’t happen soon enough, as pending petitions are now closing in on the century mark,” said Cooper.
It was during a briefing in Iowa on Tuesday that Sen. Joni Ernst asked President Trump to talk with EPA about the issue and request they follow the intent of the law with the Renewable Fuel Standard. “We’ll speak to them,” said the president. “I’ll do it myself.”
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Aug 19, 2020
U.S. ethanol production increased by nearly 1 percent the week ending Aug. 14, according to data released by the U.S. Energy Information Administration on Aug. 19. Weekly ending stocks of fuel ethanol were up nearly 3 percent.
U.S. ethanol production averaged 926,000 barrels per day the week ending Aug. 14, up from 918,000 barrels per day the previous week. Production seems to have stabilized in recent weeks after falling to historic lows last spring due to the impact of the COVID-19 pandemic.
EIA data shows U.S. ethanol production hit a low of 537,000 barrels per day the week ending April 24. Production trended upward in May and June as travel restrictions associated with the pandemic began to ease and fuel demand increased. Production levels since July have generally stabilized in the range of 900,000 to 950,000 barrels per day, down roughly 10 percent when compared to the same period of last year.
Ethanol production was down 97,000 barrels per day when compared to the same week of last year, and down 153,000 barrels per day when compared to the final week of February, before COVID-19 began to impact fuel markets.
Weekly ending stocks for fuel ethanol increased to 20.27 million barrels the week ending Aug. 14, up from 19.75 million barrels the previous week. Stocks of fuel ethanol have fallen significantly over the past few months after reaching a record high of 27.689 million barrels the week ending April 17. When compared to the same week of last year, ethanol stocks were down 3.097 million barrels.
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