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Ethanol Producer Magazine

March 22, 2016

By Erin Voegele

A recent study has shown that while the renewable fuels industry continues to be a strong driver of Iowa’s economy, its impact took a small step backwards in 2015 due to reductions in renewable fuel standard (RFS).

The study, authored by John Urbanchuk of ABF Economics and commissioned by the Iowa Renewable Fuels Association, four that Iowa’s renewable fuels industry, including ethanol and biodiesel, supported nearly 43,000 jobs throughout the state economy last year while generating nearly $2.3 billion in household income. The industry also accounted for approximately $4.6 billion, or 3.5 percent of Iowa GDP. When compared to 2014, GDP was down 5.6 percent, with jobs down 8.8 percent and income down 11.6 percent.

The ethanol industry alone supported approximately 39,592 jobs, nearly $2.07 billion in household earnings, and nearly $4.3 billion in GDP, along with $7.05 billion in purchases. The biodiesel industry supported an estimated 3,059 jobs, $198.1 million in household earnings, $344.3 million in GDP, and $689 million in purchases.

According to the report, the Iowa ethanol industry currently takes in 1.4 billion bushels of corn, which equates to 57 percent of the state’s corn crop. At 2015 Iowa farm gate prices, this amounts to $5.2 billion of revenue for Iowa corn farmers. The report indicates that expenditures for corn feedstock by Iowa ethanol producers fell 7.6 percent when compared to 2014 levels due to lower prices.

The report also notes Iowa’s ethanol industry posted a 3.8 percent increase in output last year, with the state’s 43 operating ethanol plants producing at an annual rate of slightly more than 4 billion gallons. The state accounted for 27 percent of total U.S. output.

“The U.S. ethanol industry experienced another record-breaking year in 2015, despite a challenging economic and regulatory environment,” Urbanchuk said.

“Iowa is the leading producer of ethanol in the United States,” said Iowa Gov. Terry Branstad.  “We have been disappointed by the EPA’s unwillingness to restore a robust renewable fuel standard.  This study shows how important renewable fuels are for the future of our Iowa economy.”

“Renewable fuels continue to be a bedrock of our Iowa economy, as this study shows,” Iowa Lt. Gov. Kim Reynolds added.  “However, the drop in farmland values, farm income and commodity prices is directly being impacted by a reduction in the renewable fuel standard.  Gov. Branstad and I have called on the EPA to take action repeatedly to provide consumers choices at the pump, create jobs and increase income for Iowa families and reduce our dependency on foreign oil.”

“While Iowa’s ethanol and biodiesel industries continue to power the state’s economy, it’s disappointing that those impacts took a small step backwards last year,” stated Iowa Renewable Fuels Association Executive Director Monte Shaw. “What may be as equally frustrating is the missed opportunity to really grow Iowa’s economy. When the EPA reduced the statutory RFS levels, it reduced our ability to grow ethanol and biodiesel production, to grow forward-looking investments into new technologies, to grow farm income and to grow Iowa jobs.”

Read the original story here : Report Highlight's Impact Of Iowa's Ethanol Industry

Ethanol Producer Magazine

March 17, 2016

By Bob Dinneen

There’s a rather pernicious meme making the rounds on Capitol Hill lately—that the renewable fuel standard (RFS) is no longer relevant because America is now producing more oil through fracking. Oil company lobbyists are scouring congressional offices in a desperate effort to create the misplaced narrative that ethanol did nothing to make us more energy independent, that tight oil supplies from the Bakken are fueling a resurgence of the U.S. energy sector, and policies promoting renewable fuels are costly intrusions into the energy free market that hurt consumers and the environment. Seriously. I can’t make this stuff up.

Indeed, in his state of American energy speech last month, American Petroleum Institute president Jack Gerard doubled down on the oil industry’s attack on ethanol and the RFS, calling it a “relic of our nation’s energy past.” He’s whistling past the graveyard, of course, ignoring the fact that an oil glut they helped create is wreaking as much havoc on the stock market and the economy today as the oil shortage that caused prices to skyrocket to $140 per barrel in 2008. He’s ignoring the fact that 2015 was the hottest year on record, caused in large part by greenhouse gas (GHG) emissions from fossil fuels, which are exacerbated by fracking and tar sands. And he dismisses the fact we still import more than 45 percent of the oil processed by U.S. refineries, much of it from hostile nations that pose an existential national security threat to our homeland.

But here’s the point—the RFS was enacted to address several important policy priorities, not just energy security. It was passed at a time when corn farmers were selling their commodity for less than the cost of production and ag subsidies were necessary to avoid economic calamity. The RFS provided a value-added market that empowered farmers and allowed Congress to dramatically reduce farm program support. The RFS was enacted at a time when Congress was looking for effective programs to address climate change. The RFS has provided significant GHG benefits, reducing GHG emissions by more than 354 million metric tons over the course of the program. The RFS was passed in recognition of the fact that consumers benefit by competition. One analysis concluded the use of ethanol through the RFS reduced gasoline prices by about $1 per gallon. Even in today’s market, with the unusually low oil price driving gasoline costs lower than ethanol for the first time in years, ethanol remains a bargain for refiners and consumers because it is still the cleanest and lowest-cost octane source available.

API’s revisionist history notwithstanding, the RFS has also demonstrated its effectiveness in enhancing U.S. energy security. Net petroleum import dependence fell to just 25 percent in 2015, but would have been 32 percent without the addition of 14.7 billion gallons of domestically produced ethanol to the fuel supply. The surge in ethanol production has reduced gasoline imports from nearly 10 billion gallons in 2005 to almost zero today. Indeed, the ethanol produced in 2015 displaced an amount of gasoline refined from 527 million barrels of crude oil. That’s roughly equivalent to the volume of oil imported annually from Saudi Arabia and Kuwait combined.  Not a bad relic.

No, it is not the RFS that is a “relic of our nation’s energy past.” It is the very notion that prosperity can only be driven by petroleum without regard for the environmental, economic or national security implications of that dependency that is the “relic” world leaders need to recognize and relegate to the trash heap of history.

Read the original story here : I'll Show You A Relic

The Dickenson Press

March 16, 2016

By Mike Jerke

American-made ethanol is a clean-burning, environmentally friendly biofuel that represents an exciting step forward from dirty, foreign-sourced oil, yet an op-ed (“Renewable Fuel Standard continues to devastate”, March 10) being circulated in papers around the country paints a very different picture while relying on dubious arguments unsupported by basic logic or current data.

Interestingly, the author of that op-ed, George David Banks, is executive vice president of The American Council for Capital Formation, a group with deep ties to the oil industry that has a clear financial interest in keeping Americans hooked on oil.

Mr. Banks is spreading his dishonest scare tactics by submitting identical opinion pieces in dozens of newspapers all over the country without disclosing his ties to Big Oil lobbyists. This isn’t new for Banks. As a Senate staffer, National Journal once reported he was caught on email encouraging oil industry lobbyists to better coordinate their efforts to protect their tax exemptions that cost the American public $9.5 billion annually. It’s clear that Mr. Banks is a creature of Washington, D.C., who has little idea or concern for policies that actually improve the lives of Americans.

So one must ask, why do oil companies feel the need to hide behind front groups with non-descript names run by D.C. insiders while spending millions of dollars attacking modern biofuels that offer clear environmental, economic and performance advantages? The only logical conclusion is that the oil industry wants to limit consumer choice at the pump to maintain their near monopoly on the American energy market.

In 2005, there was bipartisan agreement in Congress on the need to increase our use of biofuels, so Republicans and Democrats worked together to pass the Renewable Fuel Standard (RFS) to take advantage of the environmental gains made possible through biofuels. And the RFS has been a resounding success.

As Janet McCabe, an official with the Environmental Protection Agency said last fall, “the biofuel industry is an incredible American success story, and the RFS program has been an important driver of that success — cutting carbon pollution, reducing our dependence on foreign oil, and sparking rural economic development.”

As CEO of Guardian Energy, I am proud of the products we produce and honored to tout the tremendous benefits ethanol and other biofuels have to offer American drivers. Biofuels significantly decrease greenhouse gas emissions in comparison to regular gasoline, some by more than 100 percent, in fact. Ethanol in particular replaces dangerous additives in gasoline that have been linked to higher cancer rates. Thanks to the RFS, that means the air we breathe today is appreciably cleaner.

Ethanol is made right here in America and is already in 97 percent of the fuel we use. In all likelihood, the gasoline you use in your car is blended with 10 percent ethanol. In 2015 alone, the RFS was responsible for a 527-million-barrel reduction in foreign oil imports. By relying less on foreign oil, we also lower the price of gasoline. Studies have shown that ethanol usage decreased the cost at the pump by as much as $1.50 a gallon during gas price spikes in recent years. And since it is American made, we are less vulnerable to the whims of foreign regimes that try to fix the price of oil to their benefit.

The RFS and biofuels are moving America forward in discernable ways. Now is not the time to roll back the clock and increase our reliance on foreign sources of oil that have higher costs — both financially and environmentally.

The RFS is a rare instance of Democrats and Republicans working together to advance solutions that benefit all Americans. By setting clear, laudatory goals for the use of biofuels, the RFS ensures we all enjoy a greener tomorrow. From cleaner air to more affordable fuel, the benefits of this program are enjoyed by all of us every single day.

Mike Jerke is CEO of Guardian Energy LLC, a cooperative effort of six Midwest farmer-owned ethanol plants based in Janesville, Minn.

Read the original story: Jerke: Despite Big Oil’s Efforts, Biofuels Are Moving U.S. Forward

Renewable Fuels Association

March 16, 2016

Today, the House Oversight Subcommittees on Interior and Healthcare, Benefits and Administrative Rules are holding a joint hearing to ostensibly examine the Renewable Fuel Standard. However, once again, no one from the U.S. biofuels industry was invited to testify, silencing a powerful voice that could speak to the provision’s implementation and effect. If invited to testify, the ethanol industry would have talked about the numerous benefits of the program and why continued support is needed to help overcome barriers erected by the incumbent oil industry.

“The Renewable Fuel Standard is currently the only law to reduce greenhouse gas emissions from the transportation sector,” said Renewable Fuels Association President and CEO Bob Dinneen. “It has enhanced U.S. energy security by virtually eliminating gasoline imports. Ethanol is the cleanest, lowest cost, highest value octane source available to refiners today, and so is helping to lower consumer gasoline prices. The RFS has been an unmitigated success, something the subcommittees should hear today from someone in the industry,” he added.

“Unfortunately, the committee has stacked the witness list with oil company apologists intent upon undermining public support for this important program,” Dinneen said. “Why is the committee afraid to hear all sides of the debate?”

According to prepared remarks provided on the committee’s website, EPA plans to again cite concern with the “E10 blend wall” as part of the reason why the agency lowered the final conventional 2014–2016 RFS renewable volume obligations below the statutory requirement. That issue is currently before the D.C. Court of Appeals in multiple lawsuits filed by both biofuel and petroleum interests.

“EPA is sticking to its script,” said Dinneen. “But the agency is once again demonstrating it does not understand Congress’ objective in passing the RFS in the first place. Congress wanted to maximize the use of renewable fuels. It wanted to break down the blend wall and other obstacles to low carbon fuels. It wanted the RFS to drive marketplace change and promote investment in new technologies and infrastructure to reshape America’s energy portfolio. However, EPA’s timid enforcement of the RFS has prevented that from happening.”

Conversely, the U.S. Department of Agriculture has been helpful through its recent Biofuel Infrastructure Partnership, which aims to add more than 1,400 ethanol blender pumps to market in 21 states. This effort, along with those already underway in ethanol and agriculture, will add E15 and E85 at nearly 2,000 new stations. Today, E15 and E85 are sold at 180 stations and 3,434 stations, respectively.

“It is bewildering to me how two agencies, under the same administration, are taking such disparate approaches to biofuels,” said Dinneen. “USDA’s efforts are helping to grow our industry, while EPA is hampering our industry and preventing the continued evolution of biofuels toward lower carbon, higher octane alternatives.”

The subcommittees will also hear anti-RFS testimony from ActionAid USA and The Heritage Foundation.

Read the original release: What’s Missing from House Oversight RFS Hearing? The Ethanol Industry

Hoosier Ag Today

March 10, 2016

By Gary Truitt

The gasoline used by more than 95 percent of Americans, E10, contains 10 percent ethanol and is safe to use in marine engines. All current boat engines are warrantied for E10 and have been for nearly two decades. Yet for some reason, BoatUS has chosen to ignore this information and the countless owner’s manuals expressly approving the use of E10. They are preying on people’s fears instead of looking at the facts.

Proper care and maintenance are the best and easiest ways to protect boat engines. While E10 is a safe, reliable fueling option for both marine engines and automobiles, higher ethanol blends, such as E15, are not approved for use in marine engines.

Furthermore, no consumer is required to fill up with an ethanol blend, but E10, E15 and other fuels do give consumers the sorely needed ability to choose a fuel that meets their price and performance needs.

As the owner of CK Motorsports, a premier certified Mercury Marine Engine & Racing service dealer that services 400-500 boats annually, and has for over 20 years in Nunica, Mich., I believe it is important to set the record straight when it comes to ethanol and marine engines.

Here are just a few facts and observations I have made over my 20 years servicing marine engines:

CK Motorsports does not see these phase separations with E10 ethanol as claimed in several boating industry articles, or special interest hit pieces.

Certain companies are rather far-reaching in making claims; knowingly or unknowingly creating consumer confusion surrounding ethanol and its use in marine engines

Ethanol is a clean burning fuel, which is much better for our environment. Put simply, CLEAN AIR, CLEAN WATER, CLEAN BOATING creates less carbon dioxide.

CK Motorsports has found ethanol fuels help marine engines run cooler, run longer and make better horsepower gains.

E10 ethanol absolutely IS an acceptable fuel for everyday use in marine engines.

When E10 comes into contact with water, the ethanol will allow the fuel to absorb some or all of that water. Additionally, E10 ethanol also eliminates the need for freeze preventers.

The primary cause of water collecting in fuel tanks is condensation from humid air.

An engine running on E10 engine can ingest small amounts of water in the fuel without harming the engine.

All Mercury Marine engines are warrantied for E10 Fuel.

Finally, it is important that all marine engine owners follow the instructions for normal storage preparation found in the operation, maintenance and warranty manuals. Failure to follow the proper operating procedures is the number one reason why boaters have fuel issues.

The bottom line is that if you have engine troubles, there are many possible causes, and you should not immediately assume E10 is the problem because the facts and my 20 years of experience show that ethanol is not to blame.

It’s time to stop the misinformation and scare tactics – it’s time for consumer choice, cleaner air and improved conservation efforts. That is what CK Motorsports believes in, because ethanol delivers.

Read the original story: It Is OK to Fuel the Boat with Ethanol

Renewable Fuels Association

By Ann Lewis

March 7, 2016

U.S. ethanol exports had a strong start in 2016, expanding 7% over December volumes to a 14-month high, according to RFA analysis of government data released late Friday. The industry shipped 87.1 million gallons (mg), with China taking a third of the market at 29.4 mg—rivaling the record of 32.6 mg to China last October. Meanwhile, the long-time top export destination of Canada received just 13.7 mg—the lowest volume of exports north of the border since October 2010. The United Arab Emirates (10.9 mg) and South Korea (10.4 mg) were other top markets in January. Brazil brought in a fairly sizable volume (6.6 mg) considering its recent absenteeism from the U.S. export picture. January’s robust exports equate to 1.05 billion gallons on an annualized basis.

Denatured fuel ethanol exports saw a 29% month-on-month increase to 65.0 mg in January. China grabbed 29.4 mg (45%) of that market, with Canada (12.2 mg, or 19%), the UAE (8.1 mg, or 12%) and South Korea (5.9 mg, or 9%) continuing as stable partners. January exports of undenatured ethanol for fuel use fell 29% from December to 20.2 mg. Brazil (6.6 mg) and South Korea (4.5 mg) received 55% of undenatured fuel exports, while the Philippines (2.9 mg), the UAE (2.8 mg), Mexico (2.2 mg) and Peru (1.1 mg) rounded out our primary customers. Sales of undenatured ethanol for non-fuel, non-beverage use crashed to the lowest level since February 2013, dipping 64% to 212,369 gallons. Similarly, denatured non-fuel use ethanol exports slumped 21% to 1.7 mg—the lowest volume in over a year. The U.S. kept exports of non-fuel product close to home with 78% of total shipping to Canada and 9% to Mexico.

As for imports, the United States imported just a splash of ethanol for fuel use in January. Inbound shipments came from Canada (500 gallons) and the Netherlands (165 gallons). Given the paltry import figure, January U.S. net exports of 87.1 mg were the highest since the record month of December 2011.

January exports of U.S. distillers dried grains with solubles (DDGS)—the animal feed co-product manufactured by dry mill ethanol plants—fell 19% from January to 800,580 metric tons (mt). DDGS exports to China tallied at 218,961 mt, representing a 3% decrease over December volumes but an increase in market share (27% of total U.S. exports vs. 23% in December). DDGS exports to Mexico were also a healthy 195,669 mt (24%), with smaller shipments distributed across several countries including Ireland (48,456 mt), Canada (47,617 mt), Thailand (46,838), Vietnam (45,744 mt) and South Korea (45,046 mt). Contracting volumes in China, Spain and Turkey were responsible for a substantial portion of the month-on-month decrease in exports, with shipments to Mexico doing their part to help offset those losses.

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Read the original release: China Takes U.S. Ethanol Export Market by Storm; DDGS Exports Slip by 19%

Renewable Fuels Association

March 7, 2016

An analysis conducted by the Renewable Fuels Association and released today finds the net energy balance of corn-based ethanol at U.S. dry mill biorefineries averages 2.6–2.8, an improvement over previous estimates, reflecting efficiency gains.

The figures build on USDA’s recent findings of a 2.1–2.3 net energy balance. RFA’s own analysis uses more current dry mill energy use data than the recent USDA study, which explains why the RFA results are approximately one-third higher than USDA’s findings.

The net energy balance is a ratio of how much energy is required to produce the corn and ethanol, and then transport the fuel to end users. In simple terms, a ratio of 2.8, for example, means every BTU of energy invested in the process to make and deliver ethanol results in 2.8 BTUs of available energy to the end user.

In February, USDA issued its updated net energy balance report on corn-based ethanol, finding “[t]here has been a large improvement in energy balance since 1995, and a small but positive improvement since 2008.” The previous USDA report, conducted in 2010, was based on 2008-era data and found that the balance was 1.9–2.3. RFA’s analysis found that USDA used the same 2008-era dry mill energy use estimates for both its 2010 and 2016 reports.

According to RFA’s own analysis, “[t]he energy balance of the top-performing quartile of biorefineries is in the range of 3.2–3.4, which approaches the USDA estimate of 4.0 for an ideally situated dry mill producing wet distillers grains.”

“As this new analysis shows, the U.S. ethanol industry has made tremendous efficiency gains in recent years,” said RFA President and CEO Bob Dinneen. “EPA should take note and update its lifecycle greenhouse gas modeling of corn-based ethanol under the renewable fuel standard to reflect these improvements. Today’s ethanol plants are achieving the levels of efficiency that EPA assumed wouldn’t occur until 2022.”

The RFA analysis used dry mill energy use data from two other widely respected findings to support its results — Mueller & Kwik (2013) and Christianson & Associates (2016).

To view a copy of the RFA analysis, visit here.

Read the original release: RFA Analysis Finds Improvement of Corn Ethanol Net Energy Balance

Ethanol Producer Magazine

March 3, 2016

By Erin Voegele

On Feb. 24, the House Committee on Agriculture held a hearing on the state of the rural economy. Biofuels and bioenergy were among the topics discussed during the nearly three-hour event.

When asked to characterize the state of the biofuels industry, Agriculture Secretary Tom Vilsack spoke about the need to maintain a strong rural economy. “I think the ability to maintain a strong and vibrant rural economy is dependent on our capacity to diversify and to create new opportunities to complement production agriculture and exports, which has been the traditional way of supporting rural America,” he said. “In my lifetime, agricultural production has increased by 170 percent even though the inputs have been relatively stable. That’s producing 170 percent more on 26 percent less land, with 22 million less farmers. The challenge that we have in rural areas is that as we were getting fewer and fewer farmers and were becoming more and more efficient with production agriculture, we didn’t overlay that with a complimentary economy that would allow folks to live work and raise their families in small communities. We’re now doing that,” he noted, adding that the development of the bioeconomy, biofuels industry and bioenergy industry all play a part in bringing manufacturing back to small towns.  

Vislack stressed that the biofuels industry is something people like and want. It’s helping create jobs, reducing the cost of gas over time, reducing emissions, reducing the trade deficit, and helping to reduce U.S. reliance on foreign oil. According to Vilsack, the industry is also helping to diversify the economy and is creating jobs in rural America.

Responding to questions about USDA support of biomass fuels, Vilsack noted the department is working through its network of research centers to look for ways in which appropriate biomass supply chains can be created for each region of the country. He also spoke about Farm Bill programs that support the production of advanced biofuels and provide loan guarantees for biorefinery projects.

In his testimony, Vilsack also highlighted the potential for biofuel use by the U.S. military. The Navy wants half their fuel to be biobased and domestically produced, he said, adding “I was privileged enough to be on a destroyer watching it be refueled with beef tallow fuel out on the Pacific theater just a couple of weeks ago.”

According to Vilsack, interest in biofuels is also strong in the private aviation sector. “There are roughly 40 airports that sell 90 percent of the jet fuel, and they are extremely interested in doing this because of the emissions and the benefit from the emissions to meet international standards,” he said, noting aviation use represents a 17 to 19 billion gallon market.

Vilsack also defended the USDA’s Biofuel Infrastructure Partnership during the event. The 21 states that participate in the program match $100 million in USDA funds with $120 million in commitments, he said. “We anticipate and expect over 5,000 additional distribution systems being put in those 21 states, so there is a lot of interest in this program,” Vilsack continued.

Vilsack said the biofuels industry directly and indirectly supports 450,000 jobs and has lowered the price of gas. “You can’t deny the fact that study after study shows that this industry has indeed over time reduced the cost of gas to consumers,” he added. Responding to misinformation regarding the food versus fuel debate, Vislack stressed there is no correlation between ethanol production and the cost of food.

Read the original story: Vislack Defends Biofuels, Bioenergy During House Hearing