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In the News

Ethanol Producer Magazine

April 4, 2017

By Renewable Fuels Association

U.S. ethanol exports hit 138 million gallons in February, the third-highest monthly volume on record, according to government data released today and analyzed by the Renewable Fuels Association. The February total falls short of only two other months—November 2011 (152.5 mg) and December 2011 (172.7 mg).

Brazil was again the top customer, taking in more than one-third of all U.S. ethanol exports (50.8 mg, or 37 percent) but 14 percent less than record shipments to Brazil in January. Canada also decreased its purchases in February with 24.7 mg (18 percent of total exports) entering the country. Sales to India, however, nearly doubled from the prior month, increasing from 13.2 mg to 24.3 mg. The United Arab Emirates (10.1 mg) and the Philippines (7.0 mg) were other significant importers in February. Year-to-date exports stood at 259.8 mg, up nearly 70 percent from the year-ago total of 154.1 mg.

Exports of U.S. undenatured fuel ethanol rose by 14 percent over January to a record volume of 106.3 mg—nearly double the quantity shipped two months prior. About half of the undenatured product (50.8 mg) went to Brazil. India received a quarter of U.S. undenatured fuel ethanol (24.2 mg), up 118 percent from its January intake. The UAE (10.1 mg) and Philippines (7.0 mg) rounded out top markets for undenatured fuel ethanol. Denatured fuel ethanol exports in February experienced a slight uptick, rising 1 percent to 26.7 mg. Canada and Peru again accounted for the bulk of the market, receiving 23.6 mg (88 percent) and 3.0 mg (11 percent), respectively.

Exports of distillers grains hit 1.07 million metric tons (mmt) in February, the highest monthly total in six months and up 14 percent over January. Mexico expanded its purchases by 36 percent to 241,249 mt (23 percent of total U.S. exports), firmly holding on to its status as the top DDGS destination for a third straight month. Similarly, the Turkish market has been expanding, with a 21 percent increase in DDGS exports in February to 152,537 mt (14 percent). Thailand (71,838 mt), China (64,534 mt), Japan (62,562 mt), Indonesia (58,934 mt), and Spain (58,263 mt) were other top markets, and together with Mexico and Turkey, accounted for two-thirds of February exports. The remaining one-third of DDGS was distributed to 29 countries around the globe. Year-to-date exports stood at 2.01 million metric tons.

Read the original story: RFA: February Ethanol Exports Neared Record, DDGS Shipments Rose

Energy.AgWired.Com

April 3, 2017

By Cindy Zimmerman

A new Department of Energy (DOE) study shows that military veterans make up a significant share of America’s ethanol industry workforce which is not only larger than any other energy sector but more than twice the national average.

Nearly one in five ethanol industry employees is a veteran (18.9%), compared to a national average of 7% across all sectors of the workforce, according to the DOE study. The study also finds that the ethanol industry employs twice as many veterans as the oil and gas sector and nearly four times as many veterans as the coal and nuclear power generation sectors. Other renewable energy sectors, including advanced biofuels, wind and solar, also employ a relatively large share of military veterans.

These statistics confirm what veterans working in the ethanol industry have been saying recently, like East Kansas Agri-Energy (EKAE) CEO Jeff Oestmann, a former U.S. Marine who recently organized a letter from industry vets urging President Trump to include renewable fuels in his energy plan.

Nine of the 52 employees at EKAE are veterans, which is very close to the national average. “Working and investing in the ethanol industry allows us to continue honoring our commitment to making America stronger and more independent,” said Oestmann during the recent National Ethanol Conference.

Read the original story: Ethanol Workforce Big on Military Vets

Echo Press

March 31, 2017

By State Representative Mary Franson

The ethanol industry contributed over $1.98 billion to Minnesota's economy in 2016. However, recent news surrounding the Renewable Fuel Standard (RFS), which regulates blending volumes in fuel, threatens to significantly impact this important market and severely affect our state's economy.

First, the White House is currently debating a change to the RFS point of obligation. Shifting the point of obligation would essentially overturn the current RFS structure and likely prevent future expansion of ethanol blending.

This potential market uncertainty is compounded by the fact that the Environmental Protection Agency is set to take full control over the RFS after 2022. The EPA would then have complete authority to reduce or eliminate corn ethanol from blending standards. This would cause a decline in ethanol production, which would raise fuel prices for consumers, and devastate business for both the ethanol producers and the Minnesota corn farmers that supply them.

As a state representative, I am firmly against policy changes that could negatively impact some of our state's most lucrative industries. Ethanol production is crucial to the state's economy and Minnesota should capitalize on this market instead of allowing government regulation to hinder its potential.

Farmers and ethanol producers should not have to rely on the RFS. If ethanol were allowed to compete in a free market, I believe corn ethanol would thrive in the fuel marketplace and continue providing economic growth and opportunity for Minnesota.

Read the original letter: LETTER: Ethanol Production is Crucial for Economy

Ethanol Producer Magazine

March 28, 2017

By Emily Skor

An important debate is happening in the nation’s capital, and it revolves around the efforts by biofuel critics to rewrite a key element of the Renewable Fuel Standard—the point of obligation.

Under the RFS, the point of obligation defines which participants in the fuel supply chain (currently oil refiners and importers) are responsible for ensuring that biofuel blends reach consumers. To comply with the law, refiners that don’t add biofuels to the mix must purchase credits from other market participants. These credits are known as renewable identification numbers (RINs), and the current system creates strong financial incentive for retailers to sell higher biofuel blends. In turn, this has allowed us to rapidly expand the market for affordable consumer options such as E15.

Now, a small group of refiners are working to secure an exemption from the RFS by shifting the obligation to retailers and fuel distributors. This would not only eliminate the incentive to sell higher biofuel blends, it would create a logistical and regulatory nightmare in fuel markets. Hundreds, if not thousands, of retailers would suddenly be required to demonstrate compliance—demanding new rules, new staff, new infrastructure and years of recalibrating a program that already works. The three-year delay we experienced in biofuel targets before 2016 from the U.S. EPA is just a sample of what could occur. Worse, the savings that consumers now enjoy thanks to homegrown biofuels could evaporate, raising costs and depressing the market for renewable fuels.

At a time when rural communities are suffering and grain surpluses are rising, this is a regulatory scheme that cannot be allowed. Farmers are already facing a fourth straight year of declining income, down nearly 50 percent from 2013, according to the USDA.

The sales pitch by refiners is hardly new. They’ve attempted to make this change for years. And, as always, the biofuels industry has stood united with farmers, distributors, retailers and other market participants to protect the RFS. Just recently, Growth Energy rallied with a broad coalition of trade groups representing everyone from the American Highway Users Alliance to the National Association of Convenience Stores to oppose changes to the point of obligation. Even other refiners like Tesoro agree.

The reason our critics are wrong is simple—the RFS is working, exactly as intended. In fact, the flexible system for trading RINs was originally created at the behest of the oil companies. Infrastructure is being deployed, and the number of stations selling E15 doubled last year, thanks to our efforts with programs like Prime the Pump.

The small band of refiners seeking to change the rules are the same group that have worked for over 11 years to gut the RFS. More recently, the owner of CVR refining, Carl Icahn, has even sought to convince biofuel advocates that sacrificing the RFS should be acceptable in exchange for a long-sought waiver from an unnecessary and outdated regulatory barrier that limits summer sales of E15. But without any incentive to sell higher biofuel blends, those sales would never take place, and retailers that have worked hand-in-hand with ethanol producers to offer new consumer options would be left at the mercy of oil refiners. To capture these summer sales, we need a functional RFS and a real fix for Reid vapor pressure (RVP) limits, such as the bill recently introduced by our biofuel champions in Congress, including Sens. Deb Fischer, R-Neb., Joe Donnelly, D-Ind., and Chuck Grassley, R-Iowa, as well as Reps. Adrian Smith, R-Neb., and Dave Loebsack, D-Iowa.

To win these fights, we must stand united. This industry is strongest when we all work together. Our critics are too well-financed and too sophisticated for anything less. I’ve seen this first-hand since taking the helm at Growth Energy almost a year ago. In that time, Growth Energy has worked side-by-side with dedicated champions from across our industry to strengthen the RFS and protect the growth of our industry and the jobs it provides. It hasn’t always been easy, but if we stand strong, we can ensure that fuel retailers have the certainty they need to invest in growth and help consumers gain access to cleaner, more affordable choices at the pump.

Read the original story: To Win RFS Fights, We Must Stand United

Biodiesel Magazine

March 21, 2017

By Ron Kotrba

March 21 represents the end of the 60-day freeze period on new regulations pending review, implemented by the incoming U.S. administration Jan. 20. Among the regulations on hold during the two-month freeze period was the final rule for the 2017-’18 renewable volume obligations (RVO) under the Renewable Fuel Standard.

While U.S. EPA has yet to announce anything on the matter, biodiesel and renewable diesel stakeholders welcome implementation of the boosted advanced biofuel volumes for 2017 and biomass-based diesel volumes for 2018, finalized by the Obama administration’s EPA last November after Donald J. Trump won the presidential election.

The advanced biofuel category for 2017 was finalized at 4.28 billion ethanol-equivalent gallons, up 19 percent over the 2016 RVO and up 7 percent from the 2017 proposal issued in spring 2016. The biomass-based diesel category for 2018 was finalized last November at 2.1 billion gallons, up 100 million from 2017, the same as what EPA proposed last spring.

“Though last year’s market actually outpaced the 2018 requirement, we are pleased that the rule is effective and that the industry can move forward under the program as outlined,” said Anne Steckel, vice president of federal affairs with the National Biodiesel Board. “With the help of a strong RFS, American biodiesel supports some 64,000 jobs across the nation, many the most affluent in their region. We look forward to working with EPA and the new administration as they begin the process of setting volumes moving forward and are confident American biodiesel producers can do even more to contribute to energy security, economic prosperity and clean air.”

Renewable diesel producer Neste Corp., which exported more than 200 million gallons of renewable diesel to the U.S. in 2016, also commented on the expiration of the regulatory freeze period.

“The regulatory freeze pending review by the new U.S. administration, which was applied to the renewable fuel volume requirements for 2017, has expired,” the company stated in a press release March 21. “Hence, the EPA continues to implement the final ruling under the RFS program as published Nov. 23.”

Kaisa Hietala, executive vice president of Neste’s renewable products business area, said, “We are pleased with the EPA’s continued commitment to the RFS program. Determination and ambitious targets are required to combat climate change globally.”

Read the original story: 2017-'18 RVOs Assumed Intact as Regulatory Freeze Deadline Passes

Twin Cities Pioneer Press

March 18, 2017

By Bob Shaw

Dump it today, drive with it tomorrow.

That’s the promise of the nation’s first waste-to-ethanol plant, proposed for Inver Grove Heights.

The $200 million biofuels plant would process Dakota County’s garbage into ethanol, to be blended with gasoline for use in cars and trucks.

If the plant works as described, it would make the county more environmentally friendly, said county Environmental Resources Director Georg Fischer.

The plant would be built by the Canadian company Enerkem Inc. and SKB Environmental Inc., a St. Paul-based waste and recycling company. The companies made a preliminary presentation to the Inver Grove Heights City Council in February but have not yet made any formal proposals to the city.

“There seems to be a potential for a lot of benefits, but there are also a lot of unknowns,” said city administrator Joe Lynch.

If the council and state and federal agencies approve, the plant could be operating by 2020, according to David McDonnell, Enerkem’s vice president for business development for North America.

The companies would build the plant near existing landfills, south of 117th Street and about 1 mile west of U.S. 52.

The plant would employ 100 workers and would pay Inver Grove Heights about $1.5 million annually in fees and taxes. “Economically, there is an attraction here,” Lynch said.

Enerkem operates two waste-to-ethanol plants in Canada. One is a small demonstration facility at the company’s headquarters in Quebec, and the other is a commercial plant for the 800,000-population city of Edmonton.

The Minnesota plant would be the first in the U.S. and would be twice of the size of the Edmonton plant.

Dakota County’s Fischer described how the plant could revolutionize garbage processing for the county, which produces 400,000 tons of garbage a year — half recycled and half going into landfills.

At the biofuels plant, workers would pick through the garbage destined for landfills a second time for recyclables, boosting the county’s recycling rate from 50 percent to about 70 percent, according to Fischer. The remaining material would be shredded into 2-inch pieces, heated and processed into ethanol.

The garbage-based ethanol, just like corn-based ethanol, would be blended into automotive fuels. The plant would produce about 20 million gallons of ethanol annually.

There’s another environmental advantage to the plant — the re-use of water.

McDonnell said Enerkem likes the site because the plant could use water from the Empire Wastewater Treatment Facility in Empire Township. The Empire plant processes sewage from the metro area and pipes the wastewater to the Mississippi River.

If the ethanol plant used that water, it wouldn’t have to pump water up from aquifers.

The savings? About 1.6 million gallons annually.

“If they were able to do that, it would become more and more of a green project,” Fischer said.

He said that by slashing the volume of garbage going into landfills, the plant would help the county meet environmental goals set by the state.

State law lists environmental practices from worst to best: landfilling, landfilling that captures flammable gases, composting or burning garbage, composting yard waste and food waste, recycling, and reduction and re-use.

The biofuels plant, said Fischer, would move Dakota County up two levels. “In that respect, it would be a great thing,” he said.

The waste-to-ethanol process is so new that many environmental groups and the Environmental Protection Agency don’t list it under methods they have evaluated.

The EPA’s website, like Minnesota’s waste-management hierarchy, places “energy recovery” in the mid-range of treatment options. Presumably, “energy recovery” would include turning garbage into ethanol.

“The process, if it works as they say, could potentially be a good alternative for us,” said city administrator Lynch.

Read the original release: Inver Grove Plant Would be First in U.S. to Turn Garbage Into Ethanol

Biofuels Digest

March 19, 2017

By Jim Lane

The state of Louisiana has become the 29th state to offer consumers what Growth Energy termed “a better choice at the pump – gasoline blended with 15 percent ethanol known as E15.”

E15 saves consumers an average of 5 to 10 cents per gallon and burns cleaner and cooler than regular gasoline, allowing engines to perform at their peak while reducing drivers’ impact on the environment. The latest in this market expansion is a RaceTrac station in Baton Rouge – now one of 672 locations nationwide to offer Americans this more affordable, cleaner biofuel. Growth Energy applauds RaceTrac and all additional major retailers who currently sell E15 including Sheetz, Kum and Go, Thorntons, Minnoco, Murphy USA, MAPCO, Family Express, Cenex, and Protec Fuels.

“The ethanol industry stands ready to provide American drivers with this performance-boosting, homegrown fuel and with every new pump offering E15, we are doing just that. Growth Energy is committed to working with our retail partners to continue this expansion,” Growth Energy CEO Emily Skor said.

“American consumers have surpassed 750 million miles on E15. When given the option, consumers choose E15, and, thanks to dedicated retailers who care about their customers, more Americans can make this choice.”

Read the original story: Louisiana Becomes 29th State to Adopt E15 Ethanol

Ethanol Producer Magazine

March 16, 2017

By Susanne Retka Schill

Ethanol critics bash the fuel for its lower energy value than gasoline, while ethanol supporters point to its octane-boosting properties. University of Illinois ag economists Scott Irwin and Darrel Good analyze the value of ethanol in blended gasoline over the past decade based on those components in a recent FarmDoc Daily post, “On the Value of Ethanol in the Gasoline Blend.”

Much of the analysis of the cost of ethanol relative to CBOB has ignored the potential benefit of the octane-enhancing qualities, particularly in the face of the reported retooling of refineries to producer lower-octane base fuels that need to be oxygenated to meet specifications.  Many analyses focus only on ethanol’s energy deficit compared to gasoline, the economists point out.

The economists lay out their methodology underlying their economic analysis to determine the net benefit of ethanol, when looking at energy-adjustments and octane-enhancements. The analysis includes charts that compare the price of ethanol to CBOB, and then the energy-adjusted price of ethanol, which increases due to its lower Btu content. It also looks at the cost of aromatics, the petroleum-based oxygenates used instead of ethanol, and the shift in use from aromatics to ethanol in one state over the past decade.

 “As expected, the energy-adjusted price of ethanol (assuming ethanol has only two-thirds the energy value of CBOB) was consistently higher than the price of CBOB by an average of $1.02 per gallon. On the other hand, the price of ethanol was consistently below the price of aromatics, considered as alternative octane enhancers, by an average of $1.06 per gallon.”  That calculates to the net value of ethanol, which though just 4 cents per gallon, calculates to “nearly $7 billion over the nine-year period from 2008 through 2016.”

The net benefit was highest in 2012 during the decade examined, Irwin and Good report. “The reason is that gasoline prices were high enough relative to ethanol to reduce the energy penalty, while at the same time lofty aromatic prices drove the octane premium to high levels. The large negative net value in 2016 is essentially driven by the reverse of the 2012 price patterns.”

Limitations to the analysis, the authors point out, include other factors not examined that could impact value, such as the value of Reid vapor pressure and the lower energy value of aromatics. “The bottom-line is that a refinery optimization model is needed to conduct a complete analysis of value of ethanol in the gasoline blend. Nonetheless, our analysis points out the partial and misleading nature of work that only focuses on the energy penalty of ethanol and ignores the octane premium.”

To view the complete analysis click here.

Read the original story: Economists: Octane Premium Offsets Ethanol Energy Penalty