In the News
July 24, 2018
By Former Sen. Jim Talent (R-Mo.)
The newly minted acting administrator of the Environmental Protection Agency (EPA), Andrew Wheeler, is a seasoned regulator who knows the issues and the playing field. I hope that means he will not repeat the mistakes of his predecessor, who squandered a nearly limitless reserve of goodwill among the president’s supporters in the heartland.
The EPA is charged with administering the Renewable Fuel Standard (RFS), which passed Congress in 2005. The RFS requires that oil refineries open the fuel market to competition from renewable fuels, including corn-based ethanol, which are now blended into nearly all gasoline. The idea was to guarantee a modest but certain market for renewables so that the industry could not be crushed by foreign oil. It was designed to reduce American dependence on foreign oil, while at the same time lowering prices at the pump and reviving manufacturing and jobs in the heartland.
The RFS has been a resounding success. Renewables have replaced 10 percent of motor fuel across the nation. There are more than 200 ethanol plants around the country, creating hundreds of thousands of jobs. Since ethanol costs about $1.40 per gallon, it is reducing the price of automobile fuel. Almost every consumer in America buys an ethanol blend when filling the tank, often without knowing it. Conventional ethanol gets no federal subsidies or tax breaks. It is more than capable of competing on its own, provided that domestic oil companies cannot refuse to sell it and the foreign oil cartel cannot manipulate the price in an attempt to destroy the renewables market.
For these reasons, President Trump strongly supported the RFS during the campaign and has supported it ever since. But this was not the case with Scott Pruitt. Under his leadership, the EPA attempted to reduce the volumetric standard for renewables. That was reversed by the White House. The EPA then attempted to count exported ethanol toward the standard, even though the RFS is designed to encourage domestic production. That was also squelched by the White House. All the while, the EPA was covertly handing out dozens of “hardship” waivers to oil refineries, which ended up reducing the standard by billions of gallons.
With gasoline more than $2.80 per gallon, the refineries are making record profits. From what hardship did they need to be rescued? It is the farm economy, right in the middle of Trump country, which is suffering. Farm income is at the lowest in 12 years, and that was before the tariffs being imposed on agricultural commodities by other countries.
Agriculture is one of the few American sectors which has consistently produced a trade surplus. It will continue to be the target of retaliatory tariffs as other countries, and especially China, attempt to retaliate against the United States. The RFS could be a powerful defensive tool in the Trump administration’s trade arsenal, replacing lost exports while also relieving the pressure of high oil prices on consumers. But the EPA has to faithfully implement it, and the opposite was true under Pruitt. No wonder he was so coldly received on his tour of farm areas this summer. His reception would have been even worse but for the civility of those in the communities his decisions had betrayed.
Now it is up to Wheeler to reverse the damage. Going forward, the EPA needs to be transparent in administering the RFS. Wheeler should consult with supporters of the RFS, including Agriculture Secretary Sonny Perdue and Senators Chuck Grassley (R-Iowa) and Joni Ernst (R-Iowa). There should be no more gimmicks, strained interpretations, covert waivers, or search for loopholes to undermine the law in favor of refiners. The EPA has no obligation to undermine American energy security while destroying hundreds of thousands of jobs and cannibalizing the market for more than 200 biofuel manufacturing centers across the Midwest.
As a first step, Wheeler can lift seasonal regulations that limit sales of higher ethanol blends during the summer months. Pruitt promised a fix in 2017, and the president called the restriction “unnecessary” and “ridiculous” this year. Trump was right. Motorists in 30 states already enjoy saving five to 10 cents per gallon on a higher-octane blend that supports local farmers. Why not give them that same choice all year?
Along with reversing demand destruction caused by waivers and upholding a strong RFS, this will earn Wheeler a loyal bench of supporters across rural America. These folks rallied around the president in 2016, and they will again, so long as our regulators in Washington stand up for his agenda. All the EPA has to do is enforce the law.
Jim Talent, a former Republican senator and representative from Missouri, championed the creation of the Renewable Fuel Standard in 2005. He is co-chairman of Americans for Energy Security and Innovation, a member of the U.S.-China Economic and Security Review Commission, and a senior fellow at the American Enterprise Institute and the Bipartisan Policy Center.
Read the original article: Andrew Wheeler Must Reverse Damage to American Heartland
July 23, 2018
By Former Sen. Byron Dorgan (D-N.D.)
America’s Renewable Fuel Standard (RFS) has been in place for more than a decade, undeniably improving the nation’s energy security and environmental health by diversifying our energy choices. It also has boosted rural economies by expanding markets for agriculture — something that farmers need now more than ever. Growing America’s agricultural and energy production brings additional benefits for global food security. Too often, those benefits are overlooked or misunderstood.
A recent Environmental Protection Agency (EPA) report released to Congress on the environmental and resource conservation impacts of biofuel production deliberately misses the mark because of what it excludes. The EPA authors note that their report excludes any consideration of biofuels’ reductions of greenhouse gas emissions or the additional environmental benefits of displacing fossil fuels. How can that be excluded if the report is about environmental and resource conservation impacts of biofuels? In fact, those are major advantages of the biofuels industry and the primary measures of environmental success for the RFS. The EPA continues to recognize those same benefits in its other publications.
Moreover, other federal agencies and labs have worked to quantify the benefits of using renewable fuels instead of petroleum. For example, Argonne National Laboratory recently published an up-to-date, comprehensive lifecycle analysis of biodiesel. According to the study, biodiesel made from soybean oil reduces greenhouse gas emissions by 72 percent, compared to fossil fuels.
There are few studies that fully and impartially tally the RFS’s environmental achievements, but there can’t be any question about the substantial carbon reductions that come from using biofuels instead of fossil fuels. Biodiesel, for example, is a commercially produced, advanced biofuel that reduces carbon emissions.
American farmers are meeting the growing global demand for food, energy and animal feed with unparalleled efficiency and productivity. They have dramatically improved yields and production while decreasing the amount of land and other inputs they use. The U.S Department of Agriculture found that American farmers managed 23 million fewer acres in 2015 than in 2007 — the year the RFS expanded. Globally, total farmland decreased by 60 million acres between 2004 and 2011, while forested area increased by 19 million acres. That means more land became available for other uses, including wildlife habitat and ecosystem services, even while we were expanding a renewable fuels industry.
More than that, U.S. farmers have improved global food security by increasing both crop and animal production. Raising beef and poultry requires protein from crops, the most efficient of which are soy and corn. Raising animals on other feeds requires more land and more expensive inputs than farmers use today.
The corn and soy crops provide more income opportunities for farmers. While they provide protein feed for animals, they also produce an abundance of oil, starch and fiber for biofuels. Those ingredients aren’t efficiently absorbed in the food chain. By creating a market for biofuels, the RFS encourages U.S. agriculture to efficiently meet growing global demand for protein.
Congress should be pushing the EPA to take a broader view of the impacts of the biofuel market on the environment — one that doesn’t cherry-pick the disadvantages while leaving out some of the major benefits.
Biofuels are diversifying the nation’s energy choices, reducing carbon emissions, and moving away from the exclusive use of fossil fuels. In addition, biofuel production encourages farmers to improve their productivity and efficient use of resources. There is no question that a fair, comprehensive analysis would show that biofuel production has had, and will continue to have, a major, net positive impact for our country. The increased production of biofuels is a winning strategy for the environment, the economy and energy security.
Byron L. Dorgan, a Democratic senator from North Dakota from 1992 to 2011, co-authored the Renewable Fuels Standard. He is a senior policy adviser at Arent Fox LLP in Washington, and an adviser to the National Biodiesel Board. Follow him on Twitter @ByronDorgan.
Read the original article: EPA Hasn’t Told The Whole Story of The Benefits of Biofuels
July 16, 2018
By Erin Voegele
The California Air Resources Board has announced that in 2016 the state’s greenhouse gas (GHG) emissions fell below 1990 levels for the first time since emissions peaked in 2004. Biofuels helped achieve the reduction.
Assembly Bill 32, legislation passed in California in 2006, requires the state to reduce its emissions to 1990 levels, or 431 million metric tons, by 2020. The 2016 Greenhouse Gas Emissions Inventory published July 11 shows California emitted 429 million metric tons of climate pollutants in 2016, a three percent drop when compared to 2015. Senate Bill 32, signed in 2016, requires the state to continue reducing GHG emissions, cutting emissions to 40 percent below 1990 levels by 2030.
According to the 2016 inventory published by CARB, carbon pollution dropped 13 percent statewide since 2004, while California’s economy grew 26 percent. Per capita emissions fell 23 percent from 2001 to 2016 and carbon pollution fell 3 percent from 2015 to 2016. The carbon intensity of California’s economy, which is the amount of carbon pollution emitted per $1 million of gross state product, dropped 38 percent between 2001 and 2016 and is now one-half of the national average.
The transportation sector was the largest source of GHG emissions in California during 2016, accounting for approximately 36 percent of California’s GHG inventory. Emissions from the sector increased 2 percent from 2015 to 2016 due to increased fuel consumption. However, CARB noted that the state also saw cars and trucks use a record 1.5 billion gallons of biofuels in 2016 under the state’s Low Carbon Fuel Standard, accounting for approximately 10 percent of the transportation fuel supply in the state. These low-carbon fuels, consisting primarily of ethanol, biodiesel and renewable diesel, avoided 14 million metric tons of carbon dioxide during the year.
CARB noted that the use of biodiesel and renewable diesel have shown tremendous growth in recent years, going from 1 percent of the total diesel blend in 2012 to 15 percent in 2016. According to the inventory, the continuously increasing market penetration of biodiesel and renewable diesel was able to offset the increase in on-road heavy-duty diesel use.
Read the original story here: California Reaches GHG Reduction Goal
July 13, 2018
By Marc Heller
EPA may have a new boss, but it's sticking to its refusal to say which refineries don't have to meet ethanol blending requirements.
In a letter to Sen. Chuck Grassley (R-Iowa), the agency declined to identify the recipients of "hardship" waivers to the renewable fuel standard, drawing a rebuke from the senator, who'd sought the information.
The agency's letter indicates that EPA isn't changing its approach under acting Administrator Andrew Wheeler.
EPA considers names of companies that petition for, or receive, the waivers to be confidential business information, Assistant Administrator Bill Wehrum told Grassley.
The senator, responding in a statement, said, "The idea that disclosing to Congress the names of waiver recipients somehow reveals confidential business information doesn't make any sense and isn't acceptable."
He called the response a "non-answer" and added: "Providing Congress with the names of recipients wouldn't reveal any details about their operations or finances. It's a necessary first step to making sure the law is being followed."
Grassley said he'll take up the issue with Wheeler.
Grassley and a handful of other senators wrote to then-Administrator Scott Pruitt in April, asking for detailed information on the waivers (Greenwire, April 17).
Grassley, the Senate's leading advocate for ethanol, has urged EPA to stop granting waivers pending a review of the policy for granting them. Pruitt had defended the increasing number of waivers — which helped reduce biofuel levels below congressionally set goals — as legally required when small refineries demonstrate economic hardship.
Since 2016, EPA has granted the vast majority of waivers requested. Some recipients, including Andeavor, have been identified in news reports. In some cases, publicly traded companies have revealed the information in public financial filings.
For 2016, EPA granted 19 of 20 petitions, the agency told Grassley, totaling 790 million renewable fuel credits, or renewable identification numbers. One RIN is equivalent to a gallon of biofuel, and refiners buy them as an alternative to blending ethanol into gasoline to comply with the RFS.
For 2017, the agency said, it received 33 petitions and granted 29 of them, totaling 1.46 billion RINs. The remaining four petitions are pending, Wehrum said in the letter.
Grassley said the lopsided approval of waiver petitions calls EPA's process into question.
"EPA's acknowledgment that only one waiver applicant has been denied in the past couple years raises questions about the legitimacy of the process. The agency seems to be using a rubber stamp to help Big Oil skirt the law," he said.
Reprinted with permission from E&E News
Read the original article: Grassley Blasts EPA's 'Non-Answer' Over Waivers
July 9, 2018
By Ryan Matheny
Members of Iowa's Congressional delegation are saying good riddance to former EPA Administrator Scott Pruitt.
"I am glad that he pulled the plug," said U.S. Senator Joni Ernst. "It was time for him to go."
Ernst discussed the embattled cabinet member's resignation in a town meeting with constituents Friday morning at the Gladys Wirsig-Jones Auditorium in Shenandoah. Pruitt's resignation comes amid several ethics violations and as he faced pressure from several Midwest members of Congress, who were critical of his stance regarding renewable fuels. Ernst had grown increasingly angry with Pruitt, accusing him of lying to her and other senators last year when he pledged to uphold the Renewable Fuel Standard mandates for ethanol and biodiesel.
"Hopefully we can forge a good relationship with the EPA," said Ernst. "We want to make sure that the EPA is doing the right thing and supporting the RFS. That's vitally important to Iowa."
Before Pruitt's resignation, Iowa Third District Congressman David Young called the criticism Pruitt was receiving "well deserved."
"I think it's well deserved that he's getting this criticism," said Young. "We've heard about the ethical issues, and there's hearings on that. Then, I'm concerned, as well, about the treatment he is giving rural Iowa, and rural America, in terms of Renewable Fuel Standards, biofuels, and those kind of things, and not keeping the president's promises."
Pruitt is being succeeded by Deputy Administrator Andrew Wheeler -- a former coal industry lobbyist. Ernst says she is already working to schedule a meeting with the acting administrator.
"I want to make it very clear to him that he needs to uphold the congressional intent of the RFS," said Ernst. "He needs to maintain that. No if's, and's or but's about it."
Likewise, Senator Chuck Grassley announced his support for Pruitt's resignation, saying "President Trump made the right decision. Administrator Pruitt’s ethical scandals and his undermining of the President’s commitment to biofuels and Midwest farmers were distracting from the agency’s otherwise strong progress to free the nation of burdensome and harmful government regulations."
Before Pruitt's resignation, the EPA did raise production standards for ethanol and biodiesel, however, the administration failed to commit to eliminate hardship waivers that allow refiners to bypass biofuel requirements.
Read the original article: Ernst: It Was Time For Pruitt To Go
July 6, 2018
By Ed Tibbetts
EPA Administrator Scott Pruitt resigned Thursday, a move biofuels backers hope will lead to a fresh start for the Renewable Fuels Standard.
President Donald Trump announced Pruitt’s resignation over Twitter.
Pruitt, a former Oklahoma attorney general, has been at the center of a number of ethical controversies, which appear to have played a role in his stepping aside. In his resignation letter to the president, he said “unrelenting attacks” have taken a “sizable toll” on him and his family.
In Iowa, Pruitt had drawn criticism over the EPA’s implementation of the RFS, the law that requires a certain level of biofuels to be blended into the nation’s fuel supply.
Lawmakers from farm states say Pruitt has been undermining promises Trump made about the RFS during the 2016 presidential campaign by granting waivers to the law for refineries. They say the moves have dampened demand and hurt farmers.
“President Trump made the right decision. Administrator Pruitt’s ethical scandals and his undermining of the president’s commitment to biofuels and Midwest farmers were distracting from the agency’s otherwise strong progress to free the nation of burdensome and harmful government regulations,” said Sen. Charles Grassley, R-Iowa.
Grassley and Sen. Joni Ernst, R-Iowa, both voted for Pruitt’s confirmation after saying they had received assurances on the RFS. And Pruitt was praised by many in the agriculture industry and Republican lawmakers in Iowa for suspending the Obama administration’s controversial Waters of the U.S. rule, a measure aimed at clarifying the requirements of the Clean Water Act.
However, the battles over the RFS left a bad taste with some of those same lawmakers, as did the spending allegations. Ernst described Pruitt in June as “about as swampy as you get.”
The president tweeted that Andrew Wheeler, the EPA’s deputy administrator, would take over as acting administrator of the agency.
Wheeler is a former coal lobbyist, but ethanol backers said Thursday they were hopeful Pruitt’s departure will mean a new start.
Ernst tweeted Thursday, “I have confidence that Andrew Wheeler will be a good partner at #EPA and I look forward to working with him on the #RFS.”
Grassley said he hoped Wheeler would “restore this administration’s standing with farmers and the biofuels industry.”
Industry officials were hopeful, too.
“I think it’s a great opportunity for a reset of the conversation,” said Monte Shaw, executive director of the Iowa Renewable Fuels Association.
Pruitt has drawn fire over the RFS in recent weeks because of waivers the agency granted to refineries. Biofuels groups say the waivers lowered demand for renewable fuels.
Last month, when the EPA issued new volume requirements for 2019 that were higher than the previous year, industry officials and supporters in Congress were nonetheless skeptical. And they were upset the volumes that had been waived for some refineries weren’t reallocated to others.
Earlier, lawmakers and industry officials were angry over the idea EPA might count ethanol exports toward the legal requirement. The idea eventually was abandoned.
Read the original article: Biofuel Backers Hopeful for a Change as Pruitt Resigns
July 3, 2018
By Rachel Gantz
A record number of travelers will take to America’s highways and byways this Fourth of July holiday, and ethanol will be lowering the price they pay for gasoline while simultaneously strengthening our nation’s energy security.
According to AAA, a record 39.7 million Americans will travel 50 miles or more by automobile for Independence Day—5 percent more than a year ago. Those drivers will be paying at least 12 percent less for gasoline—or $0.26 per gallon—thanks to ethanol, according to a new analysis by the Renewable Fuels Association (RFA). In fact, ethanol is expected to reduce household spending on gasoline by $37 billion this year, or $292 per household.
The analysis also shows that if E15 were available nationwide in place of E10, consumers would be saving even more money. The wholesale savings currently attributable to E15 is $0.32 per gallon, or 15 percent lower than E0 gasoline.
“As a record number of travelers hit the roads this holiday, there is no better way to celebrate Independence Day than to fill up with fuel containing American-made ethanol. In addition to saving American families money at the pump, ethanol boosts rural economies and helps increase our energy independence,” said RFA President and CEO Bob Dinneen.
U.S. dependence on imported petroleum is falling, thanks in part to booming domestic production of renewable fuels. In 2005, the year the original renewable fuel standard was adopted, America’s net dependence on foreign petroleum peaked at just over 60%. However, by 2017, net petroleum import dependence fell to just 20%, and would have been 27% without the addition of 15.8 billion gallons of domestically produced ethanol to the fuel supply. Last year, ethanol displaced an amount of gasoline refined from 560 million barrels of crude oil—more than the volume imported annually from Saudi Arabia and Venezuela combined.
Additionally, the U.S. ethanol industry continues to make a significant contribution to the economy. Last year, the industry supported nearly 360,000 direct, indirect, and induced jobs across all sectors of the economy, added more than $24 billion in income for American households, and generated an estimated $5 billion in tax revenue to the Federal Treasury and $5.7 billion in revenue to state and local governments.
Read the original article: Ethanol Helps Fourth of July Travelers Declare Independence from High Gas Prices
June 29, 2018
By Cindy Zimmerman
U.S. ethanol production is continuing at a strong and steady pace, hitting a new four week high for the year, according to the latest Energy Information Administration data analyzed by the Renewable Fuels Association.
Last week, ethanol production averaged 1.072 million barrels per day (b/d) or 45.02 million gallons daily. Output grew 8,000 b/d over the week before, climbing to a 26-week high. The four-week average for ethanol production lifted to 1.057 million b/d, which is the highest this year, for an annualized rate of 16.20 billion gallons.
Stocks of ethanol were 21.7 million barrels. That is a 0.5% draw down from last week.
There were zero imports recorded for the 29th week in a row.
Read the original article: Ethanol Production Continues Strong
More...
June 29, 2018
By Jennifer Dlouhy
A deluge of political scandals hasn’t sunk EPA Administrator Scott Pruitt. But a wonky debate over the nation’s biofuel policy just might.
Republican Senator Chuck Grassley bluntly warned last month he would call for Pruitt’s resignation if the Environmental Protection Agency continued exempting small oil refineries from a mandate to use renewable fuels such as ethanol made from corn, a staple crop in his home state of Iowa.
When Pruitt moved to do what Grassley wanted -- with a plan that would force larger refineries to make up for the waivers by using more biofuel -- he sparked an intense, angry uproar among oil executives and allied lawmakers who telephoned top Trump administration officials to complain. Their not-so-subtle message: Pruitt’s job was on the line.
Pruitt’s long-term tenure at the helm of the EPA was already in doubt, as lawmakers, the White House and federal investigators look into allegations of ethical lapses, abuses of power and questionable spending.
Pruitt faces scrutiny over his costly travel, the $43,000 installation of a soundproof phone booth in his office and his penchant for enlisting aides to run personal errands (including contacting the chief executive officer of Chik-fil-A Inc. to pursue a franchise for Pruitt’s wife and trying to buy a second-hand mattress from the Trump International Hotel in Washington).
President Donald Trump has generally stood by Pruitt, praising his efforts to roll back Obama administration environmental regulations while acknowledging he is "not happy" with Pruitt’s personal lapses. Yet even with the president’s public support, the allegations intrude, providing rhetorical fodder to critics of EPA regulatory shifts and leverage to lawmakers pushing particular policy outcomes.
During the biofuel policy skirmish, at least one aide to Senator Ted Cruz made an explicit threat, warning administration officials that if the EPA didn’t back off the plan, the Texas Republican would seek Pruitt’s resignation.
Other top congressional Republicans -- including House Majority Whip Steve Scalise of Louisiana, Senator Jim Inhofe of Oklahoma, Pruitt’s home state, and Senator Pat Toomey of Pennsylvania -- also protested the proposal. The lawmakers all have significant refining interests in their states, including facilities owned by HollyFrontier Corp., Valero Energy Corp. and Exxon Mobil Corp.
The interactions were described by people familiar with the encounters who sought anonymity to describe the private conversations. Representatives for Cruz did not immediately respond to emails seeking comment.
"That issue brought together the entire spectrum of the oil refining industry," said Frank Macchiarola, a group director at the American Petroleum Institute. "The refining industry was unified."
The backlash worked. After the outcry, Pruitt agreed to abandon the plan as part of a proposed biofuel regulation -- at least for now.
The episode underscored how the cloud of allegations and ethical questions hovering over Pruitt are affecting his day-to-day work on intricate environmental policy, limiting his room to maneuver on sensitive issues. That includes the Renewable Fuel Standard, a 13-year-old mandate that pits oil refining and agricultural interests against each other in a zero-sum contest over gasoline market share.
"Forget the secret phone booth, Chik-fil-A and the mattress, the story is the RFS," said Tristan Berne, an analyst with the independent research firm Capital Alpha Partners LLC. "He managed to put himself in a sort of tug-of-war -- and he’s the rope."
The Renewable Fuel Standard has long been politically treacherous terrain; now, it’s even more fraught.
"His issues have given opponents free rein to take shots at him when they disagree with him," said Frank Maisano, a senior principal at Bracewell LLP. "It’s a little bit unfair, because he’s doing the best he can to address a very complex and difficult issue where there’s lots of disagreement and lots of competing interests."
It’s not clear that political threats against Pruitt or his other problems are affecting policy outcomes. The EPA has doggedly continued rewriting rules governing air pollution and climate change, with Pruitt just this week ordering new limits on the EPA’s ability to preemptively veto projects because of water pollution concerns.
And Deputy EPA Administrator Andrew Wheeler said in an interview Wednesday that neither negative headlines nor concerns about them were "impacting our decisions or how he’s managing the agency at all."
Berne observed that in the biofuel policy dispute, Pruitt "didn’t act as though he had any political restraints on him." After all, the EPA’s decision not to immediately reallocate biofuel blending requirements was seen as a slap in the face of politically important agricultural interests.
Pruitt initially embraced the reallocation idea on June 18, following a tour through Kansas, Nebraska and South Dakota, where he met with farmers angry that the EPA was exempting refineries from biofuel-blending requirements.
Federal law allows small refineries facing a "disproportionate economic hardship" to get the waivers. But Trump’s EPA is more liberally awarding the exemptions, which can be worth hundreds of millions of dollars for the refineries that qualify. And because farmers are on the front lines of the simmering trade war with China, the administration has less flexibility to address the issue, according to Craig Irwin, a senior research analyst with Roth Capital Partners LLC.
Key White House officials were not immediately aware of the EPA’s reallocation policy decision, according to a person familiar with the situation. The ensuing firestorm -- including phone calls to White House officials -- prompted the EPA’s swift pivot away from the plan.
But it didn’t quell the threats. Immediately after the EPA unveiled its stripped-down biofuel quota plan -- without the language the farm-state lawmakers wanted -- Grassley issued a statement casting the proposal as a betrayal of Trump’s campaign vow to support ethanol and invoking his powerful role as chairman of the Senate Judiciary Committee.
If the EPA doesn’t make up for the biofuel waivers, Grassley said, "Administrator Pruitt should let someone else do the job who won’t continue to undermine the president."
Read the original story: Scandals Haven't Beaten Pruitt. A Biofuel Policy Fight Might
Minnesota Pollution Control Agency
June 28, 2018
News Release
State regulators and biofuel industry leaders want Minnesota companies to be able to grow quickly and create jobs without sacrificing environmental standards.
With those common goals, they formed a public-private collaboration to reduce complexity and streamline the process for permitting while bolstering environmental compliance for all industries in the state. It started with a meeting last year of representatives from the state’s 20 ethanol plants and officials from the Minnesota Pollution Control Agency (MPCA) and Dept. of Agriculture.
With an eye toward environmental stewardship and clean business productivity, the second "ethanol summit" convened June 28 in Willmar to review progress and set future objectives.
Ethanol production plants operate with a variety of state and federal environmental permits regulating air emissions, water use, and stormwater and wastewater management.
“The meetings of the joint state-ethanol industry work group have resulted in a cooperative, improved understanding of how to work with each other,” says Sarah Kilgriff, manager of the land and air compliance in the MPCA’s Industrial Division. “It's already leading to better regulatory outcomes for the environment and producers in the ethanol industry.”
The meetings help to see other perspectives and create a better understanding of the complexity of the respective processes. The MPCA has defined the most urgent and useful information needed for the industry. The industry better understands how to work with the MPCA and the regulatory process.
The MPCA already has made some changes. New permit language allows more flexibility in making facility changes to avoid triggering the permit amendment process.
“Working together produces better outcomes for Minnesotans in terms of both the environment and economy compared with top-down regulation,” Kilgriff says. “Industry participants say they have great relationships with the MPCA and confidence that they can do a better job growing the industry.”
Minnesota is a national leader in ethanol policy and development. It was the first state to mandate the use of ethanol in motor vehicle fuel. State law requires that all gasoline sold in Minnesota contain 10 percent biofuel — that being exclusively ethanol.
The 20 plants in Minnesota produce more than one billion gallons of clean biofuel annually providing a market for more than 400 million bushels of corn. A by-product, distillers dried grains, is used for livestock feed.
Read the original release: Ethanol Summit Getting Industry, Environmental Regulators On Same Page
June 20, 2018
Press Release
Democratic members of the House Energy and Commerce Committee and the House Committee on Agriculture today called on the Environmental Protection Agency (EPA) to provide additional information regarding their failed implementation of the Renewable Fuel Standard (RFS). In a letter led by Congressman Dave Loebsack and Congresswoman Cheri Bustos, the members laid out a series of questions seeking information about the mismanagement of a program that provided waivers to some of our nation’s largest, most profitable refiners, but were intended to help support small refiners with demonstrated economic hardship and were in danger of going bankrupt. The group of 12 lawmakers is also seeking information about the EPA’s retroactive awarding of Renewable Identification Numbers (RINS), which undermine the biofuels market. The lawmakers have made repeated requests for this information, which the EPA has refused to answer. A copy of the letter can be found here.
“We write to convey our grave concerns and request additional information regarding your failed implementation of the Renewable Fuel Standard (RFS) program. We are deeply troubled by the lack of transparency and continued manipulation of the RFS program through your misuse of the small refinery exemption process,” the lawmakers wrote in a letter to EPA Administrator Scott Pruitt. “The Environmental Protection Agency (EPA) continues to hurt farmers and undermine the biofuels market by extending waivers to an unusually large number of refineries. Additionally, your implementation of the RFS program is undercutting the market for renewable fuels, and inflicting further economic pain in rural communities and throughout the agriculture sector.”
“We remain extremely concerned about your implementation of the RFS program and its effects on rural communities. Your actions are clearly designed to enrich the oil industry at the expense of farmers and the renewable fuels industry by undermining the RFS program. We request that you suspend the small refinery exemption process until you provide Congress with information to evaluate this program,” the lawmakers concluded.
Read the original press release: Lawmakers Demand Answers from EPA on Failed Implementation of Renewable Fuel Standard
June 26, 2018
Press Release
Today, U.S. Senator Tina Smith (D-Minn.) said she is skeptical of the Environmental Protection Agency’s (EPA) announcement of the amount of corn-based ethanol and other renewable fuels the agency says will be blended into the nation’s gasoline supply in 2019.
Sen. Smith, who has pressed for expanded use of renewables, said the EPA-announced target of 19.88 billion gallons—required under the federal Renewable Fuels Standard (RFS)—does not specify how refiners will make up for the gallons lost from controversial EPA-granted waivers. Earlier this year, the agency granted a “financial hardship” waiver to an oil refinery owned by billionaire Carl Icahn, exempting the facility from RFS rules, and reportedly saving it tens of millions of dollars in related RFS costs. Such waivers will cut demand for ethanol by an estimated 1.6 billion gallons, according to the Minnesota Biofuels Association.
“A strong Renewable Fuels Standard is critically important to Minnesota, where ethanol produced from corn creates an estimated $6.7 billion in economic output and supports almost 18,000 jobs across the state,” said Sen. Smith. “But if the EPA is going continue to allow refineries to get around RFS requirements by granting them waivers, the amount of ethanol and other renewables used in the nation’s fuel supply will fall far short of the target levels announced today. The EPA needs to step up and ensure that our nation meets the 19.88 billion target, and I plan to hold them accountable for doing so.”
The 2019 target of 19.88 billion gallons of renewable fuels blended into the nation’s fuel supply is scheduled to be finalized by November 30. It includes 15 billion gallons of corn-based ethanol. In Minnesota, the state’s 19 corn ethanol plants can produce 1.2 billion gallons each year.
Read the original press release: Tina Smith Remains Skeptical of EPA’s Proposed Targets for Ethanol, Other Renewable Fuels to be Blended into Nation’s Fuel Supply in 2019
June 26, 2018
By Jarrett Renshaw, Chris Prentice
The Trump administration’s Environmental Protection Agency has consistently ignored recommendations from the Department of Energy to reject or limit waivers to oil refiners seeking exemptions from nation’s biofuels law, according to five sources familiar with the matter.
The U.S. Renewable Fuel Standard requires the firms to cover costs of blending corn-based ethanol into gasoline. But the EPA, after consulting with the energy department, can exempt small refineries in cases where compliance presents a “disproportionate economic hardship.”
The waivers can save refiners tens or even hundreds of millions of dollars a year.
Under EPA chief Scott Pruitt, an appointee of President Donald Trump, the agency has issued more than two dozen such exemptions in recent months - about triple the usual number granted under past administrations.
During that time, EPA has consistently granted full waivers in cases where the energy department recommended only partial exemptions, and, at least once, granted a full approval when the energy department advised an outright rejection, according to two sources familiar with the decisions.
That approach marks a sharp break from Obama administration’s EPA, which had often either adopted energy department recommendations or, when it didn’t, ruled against exempting oil refiners, the sources said.
The shift between the Democratic and Republican administrations shows how political ideologies and constituencies can steer bureaucratic interpretation of a law that never changed - with major impacts on industry.
The waivers save refineries money by freeing them from their obligation to blend ethanol into their gasoline or to purchase compliance credits from those who do. The broad use of waivers lately has angered the powerful corn lobby, which argues they threaten corn demand.
The Renewable Fuels Association, which represents U.S. ethanol makers, last month estimated that the waivers have reduced the amount of ethanol refiners are required to blend by 1.6 billion gallons. The law currently requires refiners to blend 15 billion gallons of the biofuel per year.
The surge in waivers has sent the price of biofuels compliance credits to five-year lows, saving refiners such as Valero Energy Corp and PBF Energy hundreds of millions of dollars.
Until now, it was not known if the EPA gave the waivers on the basis of the energy department recommendations or despite them. The EPA has denied public records requests seeking information on the waivers, which it considers proprietary company information.
Biofuel groups have asked the U.S. Court of Appeals for the 10th Circuit in Washington to review legality of the waivers - arguing the EPA is “methodically destroying the demand for renewable fuels” - and to force the EPA to disclose them.
EPA spokeswoman Molly Block declined to comment on the pending litigation or on whether the agency has approved waivers that the energy department recommended rejecting.
“From the beginning of this administration, we have worked closely with our partners at DOE on this issue,” she said in a written statement.
DOE spokeswoman Shaylyn Hynes did not respond to requests for comment.
During a recent Midwest tour, Pruitt told Nebraska farmers that the EPA works “in alliance with the Department of Energy” to grant the waivers, saying there was just one example of disagreement. EPA spokespeople have repeatedly said the agency’s criteria for granting waivers have not changed.
The sources with knowledge of the two agencies’ interactions disputed the assertion that the EPA and DOE are acting as partners in these decisions. They declined to provide a specific number of cases in which the EPA has gone against energy department recommendations or to name most of the companies involved, but did provide two examples of what they said has become regular practice.
In one case, the EPA provided a full waiver to a refiner after the energy department had recommended rejecting the exemption, two sources told Reuters.
In another, the EPA granted full waivers to refineries owned by Andeavor - a large U.S. refining company which reported $1.4 billion in net income last year - after the energy department had recommended a 50-percent exemption, according to two other sources familiar with the company’s approval. The waivers for Andeavor were first reported by Reuters in April.
The company said in a May earnings statement that the waivers, provided to its smallest refineries, saved it about $100 million in compliance costs.
Scott LaBelle, an Andeavor spokesman, declined to comment beyond the company’s previous statements.
Obama’s administration was accused of being too stingy with the waivers. Last year, an appellate judge said Obama’s EPA had used too narrow a definition of “financial hardship” when it denied Sinclair Oil waivers for its Wyoming refineries for 2014 and 2015. But appellate judges in two other similar cases upheld the EPA’s denials and its methods.
Neither the rulings nor the change in presidential administrations changed the way energy department analysts scored applications, according to the sources.
Energy department analysts score applications on a two-part test that considers whether compliance would lead to disproportionate impact or threaten a refinery’s viability. Qualifying under either leads to a partial exemption; qualifying under both leads to a full exemption.
The EPA’s relaxed standard for the waivers is the latest illustration of the agency’s leadership seeking to deliver relief to refiners from the law, which was signed under Republican President George W. Bush to help farmers, reduce petroleum imports and improve air quality.
Pruitt has repeatedly recommended overhauling the law to reduce strain on refiners and advocated for changes during months of failed negotiations between oil and corn representatives mediated by President Donald Trump.
Republican Senator Joni Ernst from Iowa, the top ethanol-producing state, said Pruitt’s handling of the waivers appeared to be based on a political goal of helping the oil industry - a charge the EPA has denied.
“This is definitely a workaround that they have figured out. That’s why we are demanding transparency,” Ernst said in an interview, referring to requests her and other lawmakers for the EPA to disclose information on the waivers.
The current administration has attempted to lower compliance costs for some refiners since billionaire investor and refinery-owner Carl Icahn first raised concerns to Trump during his campaign, and then again after Trump named Icahn as a “special advisor” on industry regulation after his election.
Icahn resigned from his advisory post in August under pressure from lawmakers who said his dual role as investor and advisor posed ethical concerns. Icahn’s CVR Energy was among the refining companies that received a waiver from EPA, Reuters reported earlier this year.
Read the original article: Exclusive: Trump's EPA Ignored Energy Department Calls to Limit Biofuel Waivers
June 24, 2018
In letters to U.S. Department of Agriculture Secretary Sonny Perdue, more than 100 business and farm leaders across seven Midwest states called on regulators to lift restrictions on the sale of ethanol, a crop-based biofuel that drives Nebraska agricultural revenues and rural manufacturing. Signers from Nebraska included Alan Tiemann of Seward, Dinkel’s of Norfolk, Midwest Labs of Omaha and 20 others.
“New markets for American-made biofuels promise to rejuvenate growth, but long-standing policies designed to promote cleaner, more cost-effective options at the fuel pump have been under siege by special interests in Washington,” wrote 73 business groups and Midwest employers. “We ask that you stand firm against these attacks and use every tool available to prevent U.S. Environmental Protection Agency Administrator Scott Pruitt from adopting regulatory schemes that would further undercut demand for biofuels and their energy-rich farm feedstocks.”
The business leaders noted an urgent need to reverse a five-year dive in farm income that threatens to stall the rural economy “well beyond farm communities.” They also called on Perdue to act swiftly on the President’s pledge to lift outdated restrictions against the summertime sales of E15, a motor fuel containing 15 percent ethanol. The message was mirrored by farm leaders in their own letter to Secretary Perdue.
“For far too long, the EPA has failed to update regulations on Reid Vapor Pressure, which hold E15 to tougher standards than traditional gasoline during the summer,” wrote 37 Midwest agricultural groups and farmers, who harvest the renewable energy for nearly every gallon of U.S. ethanol. “There’s no reason for the restriction, which prohibits many retailers from offering cleaner, more-affordable options to their customers. Lifting these needless restrictions would provide a vital outlet for America’s 3.9 billion bushels of surplus grain, boost rural growth, and promote American energy dominance.”
The letters were offered in a show of support for an ongoing campaign organized by Growth Energy, America’s leading trade association of biofuel producers and supporters. Under Growth Energy’s leadership, rural advocates from across the country have urged policymakers in Washington to unleash America’s vast renewable resources to lower fuel prices, strengthen U.S. energy security, protect the climate, and put an end to a farm crisis that threatens to send an entire generation of farmers out of business. A similar call to action was issued earlier this month by 55 public officials from Michigan, Minnesota, Missouri, Nebraska, Ohio, South Dakota and Wisconsin.
“Starting June 1, outdated federal regulations cut off millions of drivers from a lower-cost fuel that supports farmers and rural manufacturing,” Growth Energy CEO, Emily Skor, said. “President Trump promised Midwest lawmakers that he would fast-track a fix, and Secretary Perdue is working with the EPA on a solution, but time is running out. Farmers cannot afford to be locked out of the market for another driving season, especially when we could be holding down quickly-rising gas prices.”
Intended to reduce evaporative emissions, the current RVP guidelines were drafted before E15 hit the market, resulting in outdated restrictions that hold E15 to higher standards than less eco-friendly options offered all year long. Those limits now threaten growth opportunities for farm crops amid the sharpest agricultural downturn since the 1980s.
“Ethanol is really about enhancing the value of corn, as I sell #2 corn as a commodity and then buy distillers grain as a feed for my cow herd, and then you add in the cleaner air that ethanol provides, it is such a win-win for Nebraskans”, stated LaVon Heidemann of Elk Creek another signer on the letter.
Read the original article: Business and Farm Leaders Seek Relief from Limits on Biofuels
June 21, 2018
Gevo, Inc. announced today that it has entered into a long-term agreement to supply its renewable alcohol-to-jet fuel (ATJ) to Avfuel Corporation, effective July 1, 2018 (the “Supply Agreement”). Avfuel is a leading global supplier of aviation fuel and services to all industry consumer groups, servicing more than 3,000 locations worldwide. The Supply Agreement with Avfuel is Gevo’s first long-term commercial supply agreement for its ATJ.
“We are pleased to have a customer and partner like Avfuel. Avfuel has tremendous reach with more than 650 Avfuel-branded locations and 3,000-plus fueling locations worldwide to a vast scope of customers. We appreciate its vision and leadership in working with us to bring a better and more sustainable fuel to the market place. Not only can we reduce greenhouse gas emissions, but we also can produce a higher quality product than petroleum-based jet fuel from a technical standpoint. The whole supply chain should benefit, as well as the end customer. This contract with Avfuel is an excellent first step and will serve as a catalyst for Gevo to build up the aggregate demand so we can proceed with the development of a larger scale ATJ facility,” said Patrick Gruber, Gevo’s chief executive officer.
Craig Sincock, owner, president and CEO of Avfuel said, “As a leader in the global supply of aviation fuel and services, we have a social responsibility to make sustainable alternative jet fuel a reality in the marketplace. Our agreement with Gevo is a notable component in our overall strategy to support our industry’s commitment to reduce carbon emissions and enhance sustainability to mitigate its effect on climate change.”
Sincock remarked that the agreement with Gevo will help the company meet the demand of its customers for a low-carbon, alternative jet fuel, filling a gap in the industry’s supply chain.
The Supply Agreement contemplates two phases. During the first phase, Gevo will supply Avfuel from its smaller-scale hydrocarbon processing facility it operates in Silsbee, Texas, in partnership with South Hampton Resources, Inc. (the “Silsbee Facility”). Currently, the Silsbee Facility has the capacity to produce approximately 70,000 gallons of renewable hydrocarbon products per year (50% of which is ATJ and 50% of which is isooctane).
During the first phase, Gevo expects to construct a larger-scale hydrocarbon facility at its existing ethanol and isobutanol production facility located in Luverne, Minnesota, (the “Luverne Facility”) to produce larger quantities of ATJ (the “Luverne Hydrocarbon Facility”), subject to Gevo's receipt of sufficient financing. Upon completion of the Luverne Hydrocarbon Facility, the second phase of the Supply Agreement would commence, which would have a term of five years, subject to extension upon the mutual agreement of the parties. During the second phase, Gevo would supply Avfuel with larger volumes of ATJ, ramping up to 1,000,000 gallons of unblended ATJ per year, which, when blended with conventional jet fuel, would produce many millions of gallons of finished ASTM D1655 jet-fuel product for distribution per year.
With further regard to the environment, for every one million gallons of ATJ produced, approximately 20 million pounds of animal feed and protein would also be produced and sold into the food chain. To produce ATJ, Gevo fractionates grain to produce protein and animal feed while using the residual carbohydrate portion of the grain for fermentation to produce the intermediate chemical: isobutanol. The isobutanol is then chemically transformed using a hydrocarbon processing facility into ATJ meeting ASTM D7566 (standard specification for aviation turbine fuel containing synthesized hydrocarbons). The ATJ made by this process has very low sulfur, low particulates, and higher energy density than petro-based jet fuel.
About Gevo
Gevo is a leading renewable technology, chemical products, and next generation biofuels company. Gevo has developed proprietary technology that uses a combination of synthetic biology, metabolic engineering, chemistry and chemical engineering to focus primarily on the production of isobutanol, as well as related products from renewable feedstocks. Gevo can produce isobutanol, ethanol and high-value animal feed at its production facility in Luverne, MN. Gevo has also developed technology to produce hydrocarbon products from renewable alcohols. Gevo currently operates a biorefinery in Silsbee, TX, in collaboration with South Hampton Resources Inc., to produce renewable jet fuel, octane, and ingredients for plastics like polyester. Gevo is committed to a sustainable bio-based economy that meets society’s needs for plentiful food and clean air and water. Learn more at our website: www.gevo.com.
About Avfuel Corporation
Avfuel provides fuel and services to the global aviation industry and is the leading independent supplier in the United States. Established as a supply and logistics company 45 years ago, Avfuel is core competent in every aspect that surrounds the delivery of fuel—from refinery to wingtip. Avfuel combines global access with personalized service throughout a fueling network of more than 3,000 locations worldwide and 650+ Avfuel-branded FBOs. Our 100% dedication to aviation demonstrates our passion and commitment to a global community that prospers on the movement of goods and services around the world.
Read the original article: Gevo and Avfuel Enter into Renewable Jet Fuel Supply Agreement
June 20, 2018
By ADM
Archer Daniels Midland Co. and DuPont Industrial Biosciences today announced a collaboration to develop, produce and market cellulase enzymes for operators of grain-based ethanol plants.
Cellulase enzymes assist in hydrolyzing the corn kernel fiber, which consists mostly of cellulose and hemicellulose carbohydrates. Once the fiber is broken down, more sugars can be liberated and then fermented into ethanol, helping grain-based fuel ethanol producers get more out of existing feedstocks. As corn kernel fiber is part of a lower-value co-product stream, the potential to develop more valuable “Gen 1.5” ethanol is attractive. Ethanol from corn kernel fiber may qualify for D3 RINS under the Renewable Fuel Standard, which encourages producers to use technology in order to utilize non-starch components of grains and other waste products in the production of biofuels.
“The industry is looking increasingly at enzyme-based tools to boost yields and produce additional ethanol without having to make significant capital investments, and we look forward to working with DuPont to help deliver solutions in this space,” said Collin Benson, ADM’s vice president of bioactives.
“We’re thrilled to add yet another significant pillar in our partnership with ADM. We are already working together in high performance renewable bio-materials; now this agreement brings together substantial resources and capabilities in the pursuit of new innovations for grain-based biofuels,” said Troy Wilson, DuPont Industrial Biosciences’ global industry leader of grain processing.
Initial product prototypes have proven successful in both laboratory and ethanol plant scale testing, and more evaluations are planned.
Read the original article: ADM, DuPont to Develop, Produce and Market Cellulase Enzymes