Convention Speakers Urge Ethanol Support

Ag Week

Feb 24, 2014

By Mikkel Pates

FARGO, N.D. — The North Dakota Cornvention 2014 focused heavily on the benefits of corn ethanol, an industry facing a hit with a proposed reduction to the Renewable Fuels Standard.

The North Dakota Corn Growers Association and North Dakota Corn Council put on the event, which featured speaker Kent Satrang, CEO of PetroServe USA. The company owns a chain of 21 convenience stores in Minnesota and North Dakota, leading the nation with 65 bioblender pumps. It operates all six private-label E15 stations in North Dakota.

Satrang said that after Gov. Jack Dalrymple helped kick off an E15 (15 percent ethanol blend) campaign in Bismarck last fall, sales have “taken off.”

Dean Drake, president of the Defour Group LLC of Fenton, Mich., and researcher for the Minnesota Corn Growers Association, said ethanol’s most valuable use is an oxygenate, even as new oil fields such as the Bakken crank out lower-octane oil. He suggests establishing a new category of “mid-level” ethanol.

If E10 is used in older cars and a new class is established as a new regular, Drake sees a healthy, gradual increase in ethanol consumption.

He said that since the federal Ethanol Tax Credit and Tariff expired in late 2011, the price of ethanol dropped and is getting close to the “energy price parity” level, where a dollar of energy in ethanol is the same as a dollar’s worth of E10 regular.

“At that point, consumers will save money on ethanol, period,” he said. “Gasoline, for the first time since the beginning of the automotive age, is going to have a serious competitor.”

Pam Keck, director of biofuel programs and business development for the National Corn Growers Association, told farmers in the crowd to use and become ambassadors for ethanol.

Keck said about 30 percent of the nation’s corn crop goes into ethanol production, but the public doesn’t realize most is still used for feed. Corn as feed accounts for 39.5 percent of the U.S. crop. Two other categories — 9.2 percent goes into distiller’s grains and 8.4 percent into exports — are both feed. Another 2 percent goes into seed, food and industrial use.

An RFS cut

Farmers are growing more corn per acre now than ever. Corn has become more efficient since 1980, cutting its per-bushel land use by 30 percent, soil loss by 67 percent, irrigation water by 53 percent, energy by 43 percent, and greenhouse gas emissions by 36 percent. Ethanol had a goal of being 20 percent better than petroleum for greenhouse gas emissions by 2022, but now is closing in on being 50 percent better, Keck said.

The original RFS 2 would have required 18.15 billion gallons, or 14.4 billion gallons if advanced biofuels are subtracted.

The EPA proposed a decrease to 15.21 billion gallons of ethanol, including 13.01 billion gallons of corn ethanol.

“If they dropped it by this amount, that represents about a half a billion bushels of corn,” Keck said, adding that it will confound agricultural planting and marketing, threaten the viability of corn growers and ethanol producers, and undermine business plans for future biofuel optimization and expansion, among other things.

She encouraged farmers to buy flex-fuel vehicles and put ethanol in them.