In the News
Feb 14, 2022
By Geoff Cooper
RFA President and CEO
A new report published today in theProceedings of the National Academy of the Sciences, funded in part by the National Wildlife Federation, purports to examine the “environmental outcomes” of the Renewable Fuel Standard. In keeping with their previous “research” on biofuels and the RFS, the authors of this new paper precariously string together a series of worst-case assumptions, cherry-picked data, and disparate results from previously debunked studies to create a completely fictional and erroneous account of the environmental impacts of the Renewable Fuel Standard.
The claims in this report simply don’t align with reality and the facts on the ground, and the paper reads more like a fantasy novel than a genuine piece of academic literature. It should not be taken seriously.
In fact, when related research from some of the same authors was released several years ago, representatives from RFA and corn grower organizations met with this study’s lead author, Tyler Lark, at the University of Wisconsin, in an attempt to begin a constructive conversation about today’s ethanol industry and the real impacts of biofuels policy.
At that time, we shared data and information with Lark and his colleagues and asked how we could collaborate on research. We asked how we could work together to ensure their error-ridden satellite analysis of land-use changes was grounded in reality. We never heard back from them.
RFA is always open to having an honest, fact-based discussion about the impacts of ethanol and the RFS on the environment and economy. We have a great story to tell, and the data to back it up. Ethanol already reduced GHG emissions by roughly half compared to gasoline, and we are on a trajectory to achieve a net-zero emissions carbon footprint for ethanol by 2050 or sooner. Unfortunately, the authors appear more interested in slandering farmers and getting salacious headlines than examining the facts.
Click here for a more detailed rebuttal from RFA that offers key facts about ethanol’s environmental impacts that were purposely omitted from the paper.
Read the original story here.
The U.S. exported 117.93 million gallons of ethanol and 933,882 metric tons of distillers grains in December according to data released by the USDA Foreign Agricultural Service on Feb. 8. Exports of both products were up when compared to December 2020.
The 117.93 million gallons of U.S. ethanol exported in December was down from 149.44 million gallons exported in November, but up when compared to the 112.87 million gallons exported in December 2020.
The U.S. exported ethanol to 40 countries in December. Canada was the top destination for U.S. ethanol at 36.33 million gallons, followed by India at 15.94 million gallons and South Korea at 14.3 million gallons.
The value of U.S. ethanol exports was at $334.91 million in December, down from $391.95 million the previous month, but up from $190.06 million in December 2020.
The U.S. exported a total of 1.24 billion gallons of ethanol last year at a value of $2.77 billion, compared to 1.31 billion gallons exported in 2020 at a value of $2.29 billion.
The 933,882 metric tons of distillers grains exported in December was down from 1.02 million metric tons in November, but up when compared to the 864,059 metric tons exported in December 2020.
The U.S. exported distllers grains to more than 30 countries in December. Mexico was the top destination at 166,756 metric tons, followed by South Korea at 130,754 metric tons and Vietnam at 103,518 metric tons.
The value of U.S. distillers grains exports increased to $248.85 million in December, up from $247.4 million the previous month and $202.7 million in December 2020.
Total U.S. distillers grains exports for 2021 reached 11.6 million metric tons at a value of nearly $3 billion, compared to 10.93 million metric tons exported in 2020 at a value of $2.33 billion.
Additional data is available on the USDA FAS website.
Read the original story here.
Feb 7, 2022
WASHINGTON, D.C. — Today, U.S. Representative Angie Craig led several co-chairs of the bipartisan Congressional Biofuels Caucus in urging the Biden Administration to take steps to protect and strengthen the Renewable Fuel Standard (RFS) as the Environmental Protection Agency (EPA) works to finalize its RFS rulemaking. In a letter addressed to EPA Administrator Michael Regan, Craig and her colleagues encouraged Regan to maintain the blending requirements for 2022, deny all pending Small Refinery Exemptions (SREs), reconsider proposed retroactive cuts to previously finalized 2020 RVOs and set 2021 RFS volumes at the statutory levels.
In the letter, the Members acknowledged positive steps taken by the Biden Administration to strengthen Renewable Volume Obligations (RVOs) and rein in the EPA’s SRE policy, which prioritized the oil industry at the expense of family farmers. But they also expressed concern with proposed retroactive reductions to RVO levels – and encouraged the EPA to reconsider changes that could negatively impact producers and restrict economic growth in rural communities.
“The benefits of renewable biofuels are clear. They play a key role in reducing carbon emissions from the transportation sector, generate economic growth and markets for family farmers across rural America, and reduce the cost of fuel at the pump for hardworking Americans,” wrote the Members.
The Members continued, “We are also concerned about the negative impact that other elements of the proposed rulemaking would have on family farmers, biofuels producers and consumers in our districts.”
Craig was joined in signing the letter by Representatives Cindy Axne (IA-03), Cheri Bustos (IL-17) Ron Kind (WI-03), Mark Pocan (WI-02) and David Scott (GA-13).
You can find the full text of the letter here and below.
February 7, 2022
The Honorable Michael S. Regan
Administrator
The Environmental Protection Agency
1200 Pennsylvania Avenue, NW
Washington, DC 20004
Dear Administrator Regan:
As the Environmental Protection Agency (EPA) works to finalize Renewable Fuel Standard (RFS) rulemaking for 2020, 2021, and 2022, we write to emphasize the importance of restoring and maintaining RFS integrity for family farmers and rural communities across our districts.
The benefits of renewable biofuels are clear. They play a key role in reducing carbon emissions from the transportation sector, generate economic growth and markets for family farmers across rural America, and reduce the cost of fuel at the pump for hardworking Americans. These clear benefits are why we are encouraged by the following elements of the EPA’s proposed RFS rulemaking:
- The proposed 2022 Renewable Volume Obligation (RVO) blending requirement. Setting the 2022 blending requirement for conventional biofuel at 20.77 billion gallons, including an implied 15 billion gallons for conventional biofuel, fulfills the statutory obligation of the RFS and creates market stability while enhancing the integrity of the RFS. We urge the EPA to finalize this proposed RVO as quickly as possible.
- The proposed restoration of 500 million gallons from the 2016 RVO. These gallons should never have been waived in the first place, and the proposal to restore 250 million gallons in 2022 and 250 million gallons in 2023 is the right one. We urge the EPA to finalize this restoration proposal.
- The proposed update to EPA’s Small Refinery Exemption (SRE) policy. The statutory language has always been clear: a small refinery must demonstrate “disproportionate economic hardship” to receive an exemption. We urge the EPA to finalize this proposal and ensure that the integrity of the RFS is not compromised by any future SRE abuse.
- The proposed denial of 65 pending SRE petitions. The SRE process was designed to provide assistance to small refineries in extraordinary circumstances, not to provide a loophole for regulatory relief. We urge the EPA to follow through on its proposed denial of 65 pending SRE petitions.
We are also concerned about the negative impact that other elements of the proposed rulemaking would have on family farmers, biofuels producers and consumers in our districts. Specifically, we believe that the following proposed actions would undermine the integrity of the RFS and create market uncertainty moving forward:
- The proposed retroactive reductions in the previously finalized 2020 RVO. These volumes were finalized in 2019, and any action to retroactively change them would be an unprecedented action that would deal a significant blow to the future integrity of the RFS. It would set a precedent that would call into question the reliability of future finalized RVO blending requirements, including the 2022 number. We urge the EPA to reverse course on this proposed retroactive reduction and consider the 2020 RVO final.
- The proposed 2021 RVO lookback and the rationale for doing so. The RFS establishes clear statutory guidance for blending requirements, and it is responsive to market conditions and fuel consumption trends. The 2021 RVO should adhere to those requirements, not reflect a retroactive lookback. We urge the EPA to reverse course on this proposed retroactive reduction and set 2021 RVOs at statutory levels.
We appreciate your continued engagement with Congress as the EPA implements the RFS. We look forward to future conversations with you and the Administration about the role of renewable biofuels in our collective effort to decarbonize the transportation sector, support family farmers and rural economies, and provide affordable fuel to all Americans.
Read the original press release here.
Feb 1, 2022
WASHINGTON – U.S. Senators Amy Klobuchar (D-MN) and Chuck Grassley (R-IA) led a bipartisan group of 12 colleagues in a letter urging the Environmental Protection Agency (EPA) to prioritize the Renewable Fuel Standard (RFS) by maintaining the blending requirements for 2022; denying all pending Small Refinery Exemptions (SREs); eliminating proposed retroactive cuts to the renewable volume obligations (RVOs); and setting 2021 RFS volumes at the statutory levels.
“The RFS is a significant tool for EPA to reduce the carbon footprint of our transportation sector,”the senators wrote.“By taking the above actions, the EPA can quickly restore integrity, stability, and growth to the RFS and the U.S. biofuel sector while ensuring that the program continues to reduce greenhouse gas emissions, diversify our fuels, drive down gas prices, strengthen our national security, and drive rural economic opportunity.”
The bipartisan letter to the EPA was also signed by U.S. Senators Tammy Duckworth (D-IL), Roger Marshall (R-KS), Tammy Baldwin (D-WI), Joni Ernst (R-IA), Dick Durbin (D-IL), Deb Fischer (R-NE), Tina Smith (D-MN), John Thune (R-SD), Debbie Stabenow (D-MI), Gary Peters (D-MI), Sherrod Brown (D-OH), and Roy Blunt (R-MO).
“We thank this bipartisan group of Senators for their efforts to protect and defend the Renewable Fuel Standard,”said Renewable Fuels Association President and CEO Geoff Cooper.“These Senators understand that the RFS is the most powerful and effective tool we have to immediately reduce greenhouse gas emissions from the transportation sector, keep consumer gas prices in check, and support a vibrant rural economy. RFA proudly stands with them in calling on the Biden administration to follow through on its commitments to put the RFS back on track.”
“The final versions of the recently proposed 2020, 2021, and 2020 RVOs will have an immense impact for years to come on not only the biofuels industry, but also on the environment as our nation works to achieve net-zero emissions,”said Growth Energy CEO Emily Skor.“We applaud our Senate champions for showing leadership in this bipartisan call for EPA to finalize strong RVO levels and eliminate any proposed retroactive cuts. By doing so, EPA would be making meaningful progress in the Biden Administration’s commitment to move toward more low carbon alternatives in our transportation sector while supporting farmers and biofuels producers.”
Klobuchar has been a strong advocate for investing in renewable fuel infrastructure and upholding theClean Air Act’s RFS.
In December, she and Grassley introduced the bipartisan, bicameral Defend the Blend Act, which would prohibit the EPA from retroactively reducing RVO levels once the annual rule is finalized.
In September, Klobuchar led a bicameral group of colleagues in urging the Biden administration to reject significant reductions in biofuel blending requirements.
In July, Klobuchar joined with Senator Deb Fischer (R-NE) to introduce the bipartisan Consumer and Fuel Retailer Choice Act, which would amend theClean Air Actto allow for the year-round sale of E15.
In June, Klobuchar introduced a package of bipartisan bills to expand the availability of low-carbon renewable fuels, incentivize the use of higher blends of biofuels, and reduce greenhouse gas emissions.
Co-led by Senator Joni Ernst (R-IA), theBiofuel Infrastructure and Agricultural Product Market Expansion Actwould expand the availability of low-carbon renewable fuels in the marketplace, resulting in cleaner air, lower fuel process, and rural economic vitality.
Also in June, Klobuchar led a letter with 15 colleagues to the EPA and National Economic Council (NEC) expressing concern about reports that the Biden administration was considering options to exempt oil refiners from their obligations under the RFS.
Last April, Klobuchar also led a bipartisan letter with Senator Deb Fischer (R-NE) to EPA Administrator Regan calling on the EPA to reject requests to waive or reduce RVOs under the RFS.
In February, Klobuchar and Thune introduced the Adopt GREET Act to require the EPA to update its greenhouse gas modeling for ethanol and biodiesel. Klobuchar also led a letter with Grassley to the EPA highlighting the need to restore integrity to the RFS by reviewing small refinery waivers, swiftly issuing a proposed rule for the 2021 Renewable Volume Obligation, and advancing the proposed E15 streamlining proposal.
The full text of the letter is available HERE and below:
Dear Administrator Regan:
We write to you regarding the December 2021 release of two Environmental Protection Agency (EPA) proposed rules relating to the Renewable Fuel Standard (RFS).
By taking the actions below you can ensure farmers and biofuel producers have confidence that you are making the RFS a priority. We support your efforts to bring more transparency and consistency in the program’s implementation. While there are aspects of these rules that support our homegrown energy future, our constituents need to see improvements to the proposal.
The RFS is a significant tool for EPA to reduce the carbon footprint of our transportation sector, and we urge you to take the following actions when finalizing these rules:
1. Maintain the blending requirements for 2022, including the 250 million gallon remand. We support the Administration’s proposed volumes for 2022 across all categories of renewable fuel, including the requirement of 15 billion gallons for conventional biofuel and the restoration of the first 250 million gallons illegally waived from the 2016 RVO, as well as the commitment to provide for the final 250 million gallons in 2023. It is past time that EPA finally addressed the U.S. Court of Appeals for the District of Columbia’s July 2017 remand of the 2014-2016 RVO in Americans for Clean Energy v. EPA and restored the 500 million gallons that were improperly waived. We urge you to maintain the strong blending requirements for 2022 and finalize the supplemental volume of 250 million gallons in 2022.
2. Deny all pending Small Refinery Exemptions (SREs). Following several years of EPA undermining the total volumes in the RFS through the issuance of 88 Small Refinery Exemptions (SRE), we support the Administration’s proposal to deny all SRE petitions pending before the agency. Denying these pending petitions would be a positive step toward bringing integrity and transparency back to the RFS.
More importantly, we urge EPA to finalize its proposed change in approach to SRE eligibility, which notes that “small refineries fully recover the costs of RFS compliance through higher prices on sales of gasoline and diesel, and that as a result they do not suffer economic hardship due to the RFS.” The January 2020 Tenth Circuit decision in Renewable Fuels Association v. EPA found that EPA may only grant relief when the agency finds that a small refinery would suffer disproportionate economic hardship due to compliance with the RFS program. Applying this standard nationwide would help prevent future misuse of the SRE authority.
3. Eliminate the proposed retroactive cuts to the 2020 RVOs. We are extremely concerned about the proposal to retroactively waive 2.96 billion gallons of renewable fuel from the 2020 RVOs. These biofuel volumes were finalized over two years ago in December 2019, and adjusting them downward after the fact would set a troubling precedent and negatively impact the entire agriculture and fuel supply chain.
You have stated that the goal of EPA with respect to the RFS is to get the program “back on track” and provide “more certainty in the decisions that we’ve made.” Re-opening RVOs that have already been finalized while setting a precedent that future Administrations and EPA Administrators may retroactively lower previously finalized RVOs does the opposite of providing more certainty in the program. It would undermine confidence in any finalized RVO by rendering them a moving target at best—and irrelevant at worst.
Moving forward with these retroactive cuts fails to consider the self-correcting mechanism built-in to the RFS that adjusts biofuel blending to reflect lower gasoline usage. We urge you to eliminate the proposed retroactive cuts to the 2020 volumes and require obligated parties to comply with the 2020 standards that were finalized in 2019.
4. Set 2021 volumes at the statutory levels. We are also concerned that EPA has proposed to use reset authority retroactively to establish RVOs for 2021 that are equal to actual and projected volumes of renewable fuel used in the U.S. last year. The Administration cannot meet its ambitious climate goals without providing for growth and certainty in the RFS.
Finally, we request that EPA finalize this rule as quickly as possible. By taking the above actions, EPA can quickly restore integrity, stability, and growth to the RFS and the U.S. biofuel sector while ensuring that the program continues to reduce greenhouse gas emissions, diversify our fuels, drive down gas prices, strengthen our national security, and drive rural economic opportunity.
Thank you for your consideration.
Read the original press release here.
Minnesota Department of Agriculture
Jan 31, 2022
A new Minnesota Department of Agriculture (MDA) grant will help Minnesota service stations who want to offer customers more and greener options at the pump.
The Agricultural Growth, Research, and Innovation (AGRI) Biofuels Infrastructure Grant Program will award up to $6.6 million to offset the cost of investing in retail petroleum dispensers, fuel storage tanks, and other equipment certified as compatible with blends of motor fuel containing at least 25% ethanol.
“Encouraging stations to offer higher biofuels blends to customers is an immediate step we can take to lower carbon emissions,” Agriculture Commissioner Thom Petersen said. “It not only will help us meet Minnesota’s climate goals, but also strengthens our agricultural and rural economies, and the state’s as a whole.”
Applicants may request up to $199,000 for an individual project, and a minimum of $5,000. Grants may be expended over a three-year period, for projects with a start date between June 2022 and June 2023.
The MDA will award grants for equipment that is compatible with fuel blends of 25% ethanol or higher, including the installation of such equipment. Applicants must be a retail petroleum dispenser in Minnesota with no more than 10 sites, regardless of location. Separate applications must be submitted for each site in Minnesota seeking funding.
Additional consideration will be given to businesses owned by women, members of the BIPOC community, veterans, and projects that serve communities of color, Native American Tribal communities, socio-economically disadvantaged communities, and communities where access to biofuels is limited.
Funding for this program is made available through a legislative appropriation for the AGRI Program, which administers grants to farmers, agribusinesses, schools, and more throughout the state of Minnesota. The AGRI Program exists to advance Minnesota’s agricultural and renewable energy sectors. An additional $1 million in funding has been provided by the Minnesota Corn Growers Association.
Applications must be received by 4 p.m. Thursday, March 17, 2022 to be considered for funding. Visit the MDA’s AGRI Biofuels Infrastructure Grant webpage for information on how to apply.
Read the original story here.
Jan 25, 2022
Global grain trader Archer-Daniels-Midland Co (ADM.N) reported a record fourth-quarter profit on Tuesday and said it would continue to cash in on strong demand for crops and biofuel in 2022.
Chicago-based ADM's earnings jumped nearly 14% in the quarter as rising biofuel demand and strong ethanol margins doubled operating profit at its carbohydrate solutions division.
High energy and grain costs, however, clipped earnings at the corn-processing unit, as well as its core ag services and oilseeds segment, where operating profit fell from the same quarter a year earlier.
Shares were down about 2.2% in midmorning trading.
ADM's results offered a look into how the world's biggest grain traders are weathering shifts in food and fuel demand triggered by the pandemic and soaring inflation.
ADM and rival agribusinesses have benefited from rising demand for food and renewable fuel as economies reopen.
"As we look forward in 2022, we see a positive demand environment across our portfolio," said CEO Juan Luciano.
U.S. demand for ethanol is likely to return to pre-COVID levels this year and ADM's dry mills that churn out the corn-based biofuel have resumed production after pandemic-related closures in 2020, company executives said.
Surging prices for the grain and oilseeds ADM buys, sells, processes and ships around the globe have presented a challenge.
Adverse crop weather in South America and the crisis between Russia and Ukraine, a major global grain supplier, may keep crop prices elevated "well into probably 2023," Luciano said.
ADM's net earnings rose to $782 million, or $1.38 per share, in the quarter ended Dec. 31, from $687 million, or $1.22 per share, a year earlier.
Excluding one-time items, earnings of $1.50 a share, a record for the quarter, topped the consensus analyst estimate of $1.37, according to Refinitiv Eikon data.
Read the original story here.
Jan 20, 2022
Agriculture Secretary Tom Vilsack discussed the important role biofuels and biobased manufacturing play in the rural economy and highlighted the agency’s efforts to support those industries during a Jan. 20 hearing held by the House Agriculture Committee.
In his opening statement, Vilsack focused on the phrase “an extraction economy" and the need to create a circular economy where wealth is created and stays in rural areas. He explained that many of the raw resources produced by the ag economy are currently transported long distances, and value-added at some other location. As a result, opportunities and jobs are created in areas other than rural America. “I think it’s going to be important to us as we look forward to try to develop what is called a circular economy, in which the wealth is created and stays in rural areas," he said.
Vilsack offered several examples of a circular economy, including biobased manufacturing. “Biofuels is one example, but there are a multitude of ways in which we can convert agricultural waste products into a wide variety of things beyond renewable energy and fuel, to include chemicals, materials, fabrics, fibers—again creating opportunities for farmers and additional income sources as well as rural jobs.”
He also stressed that climate change creates an opportunity for the ag sector. “As we look at ways in which rural lands can be used to sequester carbon—as we embrace climate smart agricultural practices—it opens up a whole new vista of opportunity for farmers to essentially be paid for the carbon sequestration that they are currently doing and will do in the future,” Vilsack said.
Vilsack also field several questions related to biofuels, the Renewable Fuel Standard, E15 and electric vehicles during the hearing.
Rep. Vicky Hartzler, R-Mo., referenced recent media reports that the Biden administration is considering lowering its proposed 2022 renewable volume obligation (RVO) and asked Vilsack to comment on those rumors.
In response, Vilsack stressed that the proposed RVO for 2022 is the highest in the history of the RFS program. He also discussed the $700 million in COVID-19 relief for biofuels and the $100 million in biofuel infrastructure funds that the USDA has announced it will distribute this year and highlighted the importance of the U.S. EPA’s proposal to deny more than 65 small refinery exemption (SRE) petitions.
Rep. Cheri Bustos, D-Ill., also questioned Vilsack on the importance of biofuels and the Biden administration’s support for the industry.
Vilsack outlined four primary benefits of the biofuels industry. He said the industry supports stability in farm income, increases jobs in rural areas, provides consumers with choice at the pump, and benefits the environment. “That’s why it’s important for the industry to have stability,” he said. “And, stability comes not just from setting a [strong RVO], but from making sure that number is real.” He discussed the Trump administration’s overuse of SRE waivers, noting that RVOs finalized by Trump’s EPA were not real, rather they were greatly dissipated by the granting of SREs. The current administration plans to deny more than 65 pending SRE petitions, which will result in a “real” RVO. “I think the stability is going to be very helpful to this industry,” he said.
Rep. Mary Miller, R-Ill., said her constituents are concerned about the Biden administration’s focus on electric vehicles and questioned if the administration has shown sufficient support for biofuels.
In response, Vilsack reiterated the importance of the $700 million in pandemic relief and $100 million in infrastructure support that the USDA is offering to the biofuels industry, along with the impact of the EPA’s decision to reign in the SRE program. He also stressed that the Biden administration has also set an ambitious goal for sustainable aviation fuel (SAF). “I think it’s very unfair to suggest that this administration has not been supportive of the biofuel industry,” he said.
Rep. Angie Craig, D-Minn., also questioned Vilsack regarding the focus on electric vehicles. “There is a lot of conversation about electric cars,” Vilsack said, but stressed that cars with internal combustion engines will continue to remain on the road for the foreseeable future and will require the use of biofuels. Liquid biofuels will also continue to be necessary for aviation and marine transport. “We won’t see the elimination of [the biofuels industry]—we’ll see an expansion of it,” Vilsack said. “I’m excited about this industry and think the future is bright.”
Rep. Michelle Fischbach, R-Minn., expressed concern that the fact that biofuels reduce emissions is getting lost in the conversion on climate change, and asked about the agency’s support for biofuels. “I am confidence that I am one of the most ardent proponents of biofuels anywhere in this country and have been for years—decades,” Vilsack said in response, assuring the committee that biobased fuels remain a priority for the current administration.
Rep. Ro Khanna, D-Calif., said Vilsack has long championed efforts to expand biomanufacturing and asked about the impact recently allocated funding will have that sector.
Vilsack explained that a Congress allocated a relatively small amount of funds the agency in a recent infrastructure bill to look at the issue of biobased manufacturing. That funding, he said, could have a profound impact on rural America. Biobased manufacturing provides a market for a variety of agricultural waste products, Vilsack said. Those materials can be used to produce not only fuels, but also chemicals, materials, fabrics, fibers and renewable energy—all of which creates a circular economy, creates new income sources for farmers, and helps avoid some of the environmental challenges associated with some ag industries. He potential, he said, is unlimited and “rural America is ripe for this opportunity.”
Read the original story here.
Jan 19, 2022
A press conference in the run-up to the 19th International Conference on Renewable Mobility Fuels of the Future 2022 addressed the contribution that sustainable renewable fuels has already made to mitigating climate change.
That means an additional saving of almost 4 million tonnes of CO2 emissions were achieved that year, compared with the previous 12 months.
“This success is due to raising the greenhouse gas reduction quota (GHG quota) to 6% for 2020 (4% in 2019) and shows that the GHG quota and the ensuing competition for greenhouse gas efficiency are having an impact,” said Artur Auernhammer, chairman of the board, German Bioenergy Association (BBE). Sustainable biofuels played an indispensable part in effective climate protection in the transport sector and will continue to do so in future, he added.
“Biofuels outperform the minimum requirements on climate protection stipulated in the current EU Directive, notching up average greenhouse gas savings of 81% for biodiesel, 90.5% for biomethane and 92% for bioethanol compared to fossil fuels. The GHG quota rewards use of biofuels that ensure the highest possible greenhouse gas savings."
The German Bundestag’s decision to continue raising the GHG quotas means greater climate protection in the transport sector, while at the same time offering planning security for manufacturers of renewable fuels and feedstock producers.
Specifically, the GHG quota will increase from 6% in 2021 to 7% in 2022, subsequently rising step-by-step to 25% in 2030. “We assume that the increased GHG reduction quota will save a total of around 175 million t CO2 in the transport industry by 2030.
He explained: “Sustainable biofuels will contribute 110 million t CO2 of these overall savings. That makes clear that there is no alternative to commercially available biofuels if climate protection targets are to be achieved, despite the potential of electromobility and fuel cells.”
It is already apparent that the vast bulk of the vehicle fleet will still be powered by internal combustion engines in 2030, even if the ambitious electromobility targets are met by that deadline. Those vehicles will also need to make a growing contribution to climate protection. As a minimum, it will be appropriate to safeguard the contribution that commercially available biofuels make to climate protection of biofuels, while supplementing this by continuing to develop advanced biofuels and ultimately also synthetic fuels.”
Read the original story here.
More...
Jan 17, 2021
The ethanol industry entered 2022 with considerable momentum after profit margins rose to all-time records during the fourth quarter, according to CoBank’s latest Quarterly Research Report, released in January. Several risks, however, are expected to emerge during the first half of 2022.
The report shows that ethanol production surged above pre-COVID levels during the fourth quarter of 2021, delivering a massive profit margin surge. CoBank said strong consumer demand, higher ethanol prices, and sharply falling natural gas prices offset a modest rise in corn prices during the quarter, noting that fourth quarter profit margins rose to all-time records, currently averaging $1.34 per gallon. Daily operating margins peaked at $1.55 per gallon in late November, according to CoBank.
Despite the momentum with which the ethanol industry has entered 2022, CoBank said it sees several risks emerging over the next six months, including overproduction prompted by current extreme profitability, higher financing costs as the Federal Reserve raises benchmark interest rate targets, and possible economic shocks and/or demand volatility from the omicron variant. In addition, the global transition toward electric vehicles, urbanization, ride-sharing and remote work were identified as long-term challenges that collectively decrease fuel vehicle miles driven.
A full copy of the report is available on the CoBank website.
Read the original story here.
Jan 13, 2022
U.S. ethanol exports for the first quarter of the 2021/2022 marketing year (MY) landed five percent higher than the previous year, totaling 330 million gallons. Increased mobility and reduced COVID-19 restrictions have spurred a near global recovery in ethanol trade. Gains were seen in Brazil, and policy developments signal long term increased demand in Canada, the United Kingdom (UK), the European Union (EU), Colombia and India.
In Brazil, U.S. fuel ethanol exports saw a boost in the first quarter of this marketing year, totaling 32 million gallons, over six times more than the first period of the previous year. Following the implementation of a 20 percent tariff in December 2020, U.S. ethanol exports to Brazil remained near-zero for the remainder of the marketing year, ending MY 2020/2021 with a 200-million-gallon shortfall compared to the previous year. After a challenging crop year, Brazil is beginning to re-enter the market for U.S. ethanol to meet its blending mandates.
“Trade is the mechanism for countries to meet their policies, so this uptick is encouraging in this first quarter,” said Isabelle Ausdal, U.S. Grains Council (USGC) manager of ethanol trade policy and economics. “The removal of this and all tariffs remains a priority globally.”
In Canada, fuel ethanol was slightly higher than last year, as drivers continued to return to the road. Policies such as the national Clean Fuel Standard (CFS) and provincial policies including Quebec’s low carbon fuel standard and E15 in Ontario are expected to drive further demand for ethanol in that market. Final CFS legislation is expected to be published in Spring 2022. Quebec’s new standard will require 10 percent renewable content in gasoline by 2023 and 15 percent by 2030 in alignment with Quebec’s 2030 Plan for a Green Economy. Ontario will require 15 percent ethanol blending in gasoline by 2030 and will directly increase blending in Canada’s most populous province. The two provinces account for roughly 55 percent of fuel demand in Canada.
“According to the U.S. Department of Agriculture (USDA), U.S. ethanol on average decreases greenhouse gas (GHG) emissions by over 50 percent compared to traditional gasoline and provides countries with tangible progress toward their GHG reduction goals,” Ausdal said.
Exports to the EU and UK totaled 58 million gallons for the first quarter of the 2021/2022 marketing year as drivers also returned to the road in those markets. In the UK, the Renewable Fuel Transport Obligation (RTFO) officially came into force on Jan. 1, 2022, boosting the national blend mandate implemented in September 2021 and providing additional GHG reductions. Implementation of the RTFO may increase the national blending average to eight percent. In the EU, member states are beginning to incorporate the requirements of the RED II Directive into their national legislation, requiring at least 14 percent renewable energy in the transport sector by 2030. This includes increased blending of biofuels such as ethanol. The launch of E10 in Sweden and higher blending rates in France and Germany are also expected to increase EU demand in 2022.
In Colombia, the reinstatement of Colombia’s E10 mandate was postponed for a second time and is now expected to occur in August 2022. As a result, demand was down more than 50 percent in the first quarter of this marketing year compared to the last year.
Industrial ethanol exports to South Korea in the first three months of this marketing year experienced a notable boost, totaling 35 million gallons, two times higher than last year. Exports to India remained nearly equal, with the bulk of exports occurring in the last two months.
“The Council is encouraged by this uptick in global ethanol trade,” said Brian Healy, USGC director of global ethanol market development. “Our offices are hard at work with local partners in demonstrating the ongoing value of using globally available, low carbon ethanol to meet their policy goals.”
Read the original story here.
Jan 12, 2022
Both electric vehicles and the increased production and use of renewable fuels like ethanol will be necessary to achieve a national goal of net-zero carbon emissions by 2050, Renewable Fuels Association President and CEO Geoff Cooper told the House Agriculture Committee today.
“While increased deployment of electric vehicles will indeed play a vital role in reducing GHG emissions from transportation, other complementary solutions will also be required to truly decarbonize the sector by mid-century,” Cooper said in his submitted testimony. “That’s where agriculture comes in. Through the increased production and use of low-carbon renewable fuels like ethanol, the U.S. agriculture sector offers an effective and immediate solution for further reducing carbon emissions from liquid fuels across all segments of the transportation sector.”
An increased role for low-carbon biofuels is especially important in the near term, given the relatively small number of electric vehicles and barriers to EV adoption, Cooper said. The U.S. Energy Information Administration forecasts that roughly 80 percent of new light-duty vehicles sold in the U.S. in 2050 will be powered by an internal combustion engine. “Even with increased electric vehicle sales expected in the years ahead, it would take decades to entirely turn over the fleet. As such, hundreds of billions of gallons of liquid fuel will continue to be used in ICE vehicles for many years to come. To achieve true carbon neutrality in the U.S. transportation system by mid-century, strategies focused on decarbonizing those liquid fuels will need to be undertaken.”
Today’s corn ethanol already reduces greenhouse gas emissions by roughly half, on average, compared to gasoline, Cooper told the lawmakers. According to the Department of Energy’s Argonne National Laboratory, typical corn ethanol provides a 44-52 percent GHG savings compared to gasoline. “With the rapid emergence of new technologies and more efficient practices, even greater GHG reductions are coming to the corn ethanol sector,” Cooper said, noting that RFA’s board of directors last summer adopted a commitment to reach net-zero carbon emissions, on average, by 2050 or sooner. Cooper said this requires, in addition to a level playing for lifecycle GHG analysis, “certain policy and regulatory actions … to fully leverage the potential of agriculture and biofuels to decarbonize transportation.” These include:
- The removal of EPA’s arcane fuel volatility barrier, which would facilitate the rapid expansion of E15 in the marketplace.
- Implementation of strong Renewable Fuel Standard volume requirements in 2023 and beyond to ensure low-carbon biofuels have access to a growing market.
- Incentives that encourage automakers to increase production and deployment of flex-fuel vehicles.
- Additional public and private investment in the infrastructure necessary to distribute higher ethanol blends like E15 and flex fuels like E85.
- Future decarbonization policies that take a technology-neutral, performance-based approach to focus on reducing carbon emissions and increasing fuel efficiency without dictating the use of specific fuels or vehicles.
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Jan 11, 2022
The U.S. Energy Information Administration increased its forecast for 2022 U.S. fuel ethanol production in its latest Short-Term Energy Outlook, released Jan. 11. The outlook for ethanol blending in 2022 was also increased.
The EIA currently predicts that U.S. fuel ethanol production will average 1.02 million barrels per day in both 2022 and 2023, up from an estimated 980,000 barrels per day in 2021. In its December STEO, the agency predicted that 2022 fuel ethanol production would average 1.01 million barrels per day, up from an expected 970,000 barrels per day in 2021. The predictions for 2022 and 2023 production are significantly higher than the 910,000 barrels per day of production reported for 2020, but lower than the 1.03 million barrels per day of production reported for 2019.
Fuel ethanol blending is currently expected to average 930,000 barrels per day in 2022, increasing to 950,000 barrels per day in 2023. Fuel ethanol blending averaged an estimated 910,000 barrels per day in 2021. In December, the EIA predicted 2022 ethanol blending would average 920,000 barrels per day, up from an expected 900,000 barrels per day for 2021. Ethanol blending averaged only 820,000 barrels per day in 2020. The EIA said the increased forecast in ethanol consumption included in the January STEO reflects the agency’s expectation of increasing gasoline demand. At the forecasted levels for 2022 and 2023, the EIA said the ethanol share of gasoline consumption would be near the 2020 and 2021 levels of 10.3 percent.
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Jan 10, 2022
Despite a slight drop, U.S. ethanol production kept above the million barrels per day level for the last week of 2021. Production maintained a million barrels per day for 12 weeks in a row the last half of the year, for a total of 24 weeks in 2021.
According to EIA data analyzed by the Renewable Fuels Association for the week ending December 31, ethanol production eased by 11,000 barrels per day (b/d), or 1.0%, to 1.048 million b/d, equivalent to 44.02 million gallons daily. Production was 12.1% above the same week last year, which was affected by the pandemic, but 1.3% less than the same week two years ago. The four-week average ethanol production volume decreased 1.0% to 1.061 million b/d, equivalent to an annualized rate of 16.27 billion gallons (bg).
Ethanol stocks jumped 3.3% to a twenty-week high of 21.4 million barrels. Stocks were 8.3% below the year-ago level and 4.9% less than the same week two years ago
In 2020, ethanol production was over a million barrels per day for the first 12 weeks of the year but never hit that mark again after COVID struck and total production for the year was under 14 billion gallons, the lowest in more than five years. Production this year is expected to be well above 15 billion gallons, but not as high as the record 16 billion set in 2018.
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Jan 5, 2022
The director of global ethanol market development for the U.S. Grains Council says ethanol exports felt the full weight of the pandemic during the last marketing year.
But Brian Healy tells Brownfield the numbers were still relatively positive and the fifth highest ever at 1.31 billion gallons.
“A lot of the losses that we saw in early 2020 rebounded as some of those stay-at-home orders eased. We saw that demand change here in the U.S. and certainly saw that pick up in terms of fuel demand around the world.”
Canada was the largest market last year, followed by India.
“It’s an industrial use market, so not for fuel use at this time. But certainly (USGC) is optimistic that their policy for E20 will hold and create some new demand opportunities there.”
Healy says South Korea, China and the European Union rounded out the top five markets for U.S. ethanol in 2021.
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Renewable Fuels Association
Jan 4, 2022
By Randall Doyal
I write today in response to an opinion piece published on Wednesday. This piece, authored by John DeCicco, is rampant with errors and false assumptions concerning the biofuels industry. As a 40 year veteran of the industry, I have seen and heard a lot of misinformation concerning biofuels, particularly ethanol. The petroleum industry has been fighting against ethanol since the early 1900s and that fight to control the market continues on with the DeCicco piece. Would it surprise your readers to learn that the “research” done by DeCicco and his group at the University of Michigan was actually heavily funded by API, the American Petroleum Institute? That is a fact.
The author claims that the Renewable Fuel Standard (RFS) was enacted in the wake of 9/11. That is not true. The RFS was enacted after the petroleum industry was unsuccessful in getting Congress to protect the use of a petroleum product called MTBE as an oxygenate in gasoline. Because MTBE is very hazardous and causes serious environmental harm, states began to ban its use around 2004. So, the petroleum industry made the switch to using ethanol, which is also an oxygenate, instead, in 2005, and agreed to support the RFS requiring ethanol’s use. Communities all over the corn belt responded quickly to the RFS by building additional ethanol plants. In light of that rapid response to the new demand, and in recognition of increasing dependence on foreign crude oil, Congress decided to move forward with an expanded RFS in 2007. The vision here was to use cleaner, less polluting fuels that could be produced sustainably and renewably and thus help reduce our dependence on foreign oil, while also reducing emissions of greenhouse gases and tailpipe pollutants.
The Renewable Fuel Standard has been an outstanding success in reducing harmful emissions from gasoline by displacing some of the worst actors, which are called “aromatics.” These chemicals were used primarily for their high octane value (octane helps gasoline burn more completely and efficiently). But ethanol has the highest octane value of any fuel and is available at the lowest cost. And according to various universities and government research labs, the use of ethanol in our fuel in 2020 alone reduced the total CO2 emissions from our vehicles by 47.3 million metric tons. And that calculation even includes excessive and speculative modeling assumptions for CO2 production from farming and ethanol production, as well as an additional emissions penalty for hypothetical and unproven “land-use changes.” This CO2 emissions reduction is the same as if we had removed 10 million vehicles from the roads for the year, or if we had shut down 12 large coal-fired power plants. This is the one place we are actually having a huge impact on the reduction of atmospheric carbon, and the real results are even better. Hopefully, the research will one day catch up to the dynamic improvements in farming and in ethanol production, rather than lagging behind more than 5 years as they do currently.
It is important to note the huge anti-farm, and particularly the anti-corn, bias built into the emissions models used by EPA in the creation of the RFS. People assumed that if we created all this new demand for corn to produce ethanol, we would have to convert a whole lot of land into new farmland to continue to supply all the food and feed that land currently supplied. So, a large carbon emissions penalty was added to ethanol to account for this supposed “land-use change” that would occur if forest and grassland were converted to cropland. Now, even if that false assumption were true, the penalty for conversion would be a one-time penalty. Instead, it is added to every gallon produced over all these years. That makes no sense at all. But even with that added carbon penalty and using data that is more than 5 years old in terms of efficiency and energy consumption, ethanol still reduces total carbon emission by about half compared to gasoline. And the actual results are better than that!
How much has our land use changed? The change has indeed been significant…but is the exact opposite of what Professor DeCicco would lead you to think. In 1999, the U.S. had 365 million acres of land planted to crops, or listed as prevented plant, or in CRP. The assumptions in the models behind the RFS would lead you to believe that we would need about another 35 million acres planted after the RFS was enacted in 2007. Looking to 2017-2020 after the ethanol industry reached full capacity under the RFS, the actual amount of land that was planted to crops, prevent planted, or in CRP actually dropped to 345 million acres. Instead of needing more land, we are actually using less land for crop production than we did before the RFS. Why? The first reason is urbanization, where one to two million acres of prime farmland is lost to houses every year. But what is also overlooked is how much more efficient our farmers are, producing more and more bushels per acre while using fewer inputs and energy each year. Here are the facts: in 2007 (the year the RFS was expanded), Minnesota farmers planted 8.4 million acres of corn and averaged 146 bushels per acre. In 2021, farmers here planted 8.3 million acres of corn and averaged 186 bushels per acre – even with drought affecting parts of the state! Those are the facts we should all be celebrating.
But another part of what is missing is the understanding of the ethanol process. Making ethanol does not reduce our supply of livestock feed in any real sense. Our livestock need the protein in the corn, not the starch. Located in farm country, ethanol plants buy corn from local farmers, remove the starch and convert it into ethanol. The process also captures some of the corn oil for use in producing biodiesel. The remaining fractions of the corn are concentrated into a higher protein, higher value feed called distiller grains. This product then requires only one-third the volume of transportation to deliver basically the same protein value to the livestock growers. That is a huge saving in energy and reduction of carbon emissions just in transportation. So, we didn’t need more acres to produce the feed, we just changed the form to something more efficient.
America’s farmers are producing renewable, sustainable crops like corn with greater efficiencies and greater yields, while simultaneously lowering the inputs and energy consumed. They are doing so in ways that increasingly provide greater sequestration of carbon in their fields, and they have only just begun that effort. What do you see when you look at a field of corn? I see an incredible array of natural solar collectors that are using solar energy to drive photosynthesis, pulling huge volumes of CO2 out of the atmosphere, and producing huge amounts of oxygen, which we all need to breathe! Were you aware that our midwestern fields produce more oxygen than the rainforests of South America during our growing season? That is a fact. And our ethanol industry gets to access the solar energy stored by the corn in tiny batteries called corn kernels, converting it to a liquid fuel that burns cleaner and reduces CO2 emissions from our vehicles, while concentrating the protein and sending it on to feed our livestock.
Don’t fall for the false opinions funded by API or their ilk. Look instead at the facts, the reality, and see the amazing success we have created locally and sustainably that starts right here at home and positively impacts our world. DeCicco would have you use more petroleum rather than less. Let’s use more renewable, sustainable, cleaner energy produced right here from the sunlight falling on our farms.
Read the original RFA story here.
Today morning, Minnesota Bio-Fuels Association's executive director, Tim Rudnicki, testified during a virtual hearing on the EPA's proposed RVOs for 2020, 2021 and 2022. Read his prepared testimony below:
Good morning. My name is Timothy J. Rudnicki. I represent the Minnesota Bio-Fuels Association, a trade organization for ethanol producers in Minnesota.
In Minnesota, the annual total ethanol production has once again exceeded 1 billion gallons. Our ethanol is a greenhouse gas emission cutting tool because our producers reuse water, operate innovative production technology, including combined heat and power systems, and explore ways to further reduce GHG emissions in the supply chain.
These and other production factors make renewable ethanol an important tool in the efforts to cut transportation sector GHG emissions. The EPA acknowledges this point in the Federal Register at page 72441.
We recognize the EPA is requesting comment on several critical provisions of the proposed rule. To keep my comments here short, we will submit written comments addressing specific issues with the proposed rule. With that, I will briefly speak to what appears to be a fundamental EPA assumption about the lack of effectiveness of the RFS and the RVOs.
At the outset, we commend the EPA for taking some steps to get the RFS back on track. Yet, perhaps, a fundamental assumption about the inability of the Renewable Fuel Standard to increase the use of higher ethanol blends may be holding the EPA back on the RVO track.
The EPA, at Federal Register page 72447, talks about the limited success the RFS has and will have in growing the use of ethanol beyond E10 even with various incentive programs.
From our vantage point in Minnesota, the RFS has actually helped to grow the use of ethanol well beyond the mythical E10 blendwall.
In Minnesota, the greater the RVO numbers, the greater the incentive for the fuel supply chain to use higher blends of renewable ethanol. In Minnesota, the combination of state and federal programs and private investments help fuel retailers transition to offering E15 as evidenced by the 408 fuel retailers that now offer E15. In Minnesota, based on the last data sets from the Energy Information Administration, at least 12.6% of the liquid fuel for internal combustion engines was renewable ethanol.
So, from our vantage point, the RFS is helping to grow the use of renewable fuel. The RFS is boosting the economy in Minnesota while helping to make us more energy independent. And the RFS is helping to cut GHG emissions. We need the EPA to stand strong and set forth aggressive RVOs to keep the focus on reducing the use of fossil fuels and using biofuels to cut transportation sector GHG emissions.