In the News

Reuters

July 31, 2014

By Ayesha Rascoe

The U.S. biofuel industry is urging the Obama administration to go beyond simply raising proposed targets for use of the fuels, making the case instead for fundamental changes to the government's approach to the renewable fuel program.

There has been a flurry of meetings between biofuel backers and White House officials in advance of the release of the long-delayed targets for the use of renewable fuels this year, which are expected to reach the Office of Management and Budget for review within weeks.

The Renewable Fuel Standard requires increasing amounts of biofuels to be blended into gasoline and diesel supplies each year through 2022.

The targets for this year have been plagued by repeated delays amid outcry from biofuel producers, such as Abengoa Bioenergy, Green Plains Inc and Pacific Ethanol Inc, who say a draft plan slashing the 2014 standards could significantly harm the industry.

Biofuel industry sources said in May the Environmental Protection Agency would likely raise proposed levels.

Based on rising gasoline demand, the corn ethanol portion of the mandate is widely expected to be increased to about 13.6 billion gallons (49 billion liters) from 13 billion announced in November.

But the key message biofuel groups have delivered to the administration has been that their industry's future viability hinges on more than just tweaking volume requirements for the current year.

Meeting with senior White House adviser John Podesta last week, the Advanced Biofuels Association pressed the White House to speed up approvals of new fuels that can qualify as advanced and cellulosic fuels, known as pathways.

"We really tried to focus on how important it was to get pathways approved in a more expeditious way so we can actually bring more gallons to market," ABFA President Michael McAdams told Reuters. Seven top executives of companies waiting on approvals also attended the meeting.

More than 35 applications for new biofuel sources are pending at the EPA, with an average wait time of two years. The delays keep fuels off the market because would-be buyers cannot get credit under the biofuel mandate to purchase them.

BETTER CORN ETHANOL EMISSIONS?

While advanced biofuel producers seek the inclusion of new fuels, some corn growers have lobbied to protect the grain's position in the renewable fuel program.

Earlier this month, Congressman Bill Foster, Democrat of Illinois, and a group of lawmakers and scientists from the state met with White House officials including top energy and climate adviser Dan Utech.

They argued the White House should reconsider its estimates of the lifecycle greenhouse gas emissions for corn ethanol as it weighs both the final targets for 2014 and the fuel's role in the administration's broader climate policy.

Corn-based ethanol is currently classified as a "conventional biofuel" that delivers only a 20-percent emissions improvement over gasoline. Some environmental groups have blasted the fuel as not much better than fossil fuels and critics have proposed stripping corn ethanol out of the mandate.

As the Obama administration focuses on its climate legacy, changing the EPA's findings on potential emission reductions from corn ethanol could shore up support in the administration and help fend off future attacks on the fuel.

"The carbon footprint and economics of corn-based ethanol are vastly improved from a decade ago," Foster said, noting less-energy intensive farming practices and more complete use of corn by-products.

The White House asked the scientists for additional information about their research on corn ethanol emissions, said David Beaudreau, a consultant representing the Illinois Corn Growers Association.

"They were intrigued and wanted to know more," Beaudreau told Reuters.

BLOCKING BLEND WALL ARGUMENT

For the Renewable Fuels Association, it is not the final levels for this year so much as the justification behind them that is most concerning.

The group has urged the EPA to not use the shortage of gasoline stations currently able to sell fuel with higher levels of ethanol as a reason to cut biofuel targets, arguing that it would set a precedent that could permanently limit the program's targets.

The EPA has justified lowering the 2014 target as necessary because U.S. fuel markets cannot absorb the amounts of ethanol called for by federal law, a problem known as the "blend wall."

That argument would embolden oil companies to prevent growth in biofuel use simply by not investing in new fuel pumps, said RFA president Bob Dinneen.

"We are going to sell a heck of a lot of ethanol this year no matter what," he said. "If EPA guts the program by turning it over to Exxon Mobil, you will never see that again."

Read the original story here : Biofuel Groups Press White House On More Than Just 2014 Targets

Gevo Inc

July 28, 2014

Gevo, Inc. today reported an update on the progress of the implementation of the Side-by-Side operational mode (SBS) of its plant in Luverne, MN. In the beginning of June, Gevo commenced the co-production of isobutanol and ethanol, with one fermenter dedicated to isobutanol production and three fermenters dedicated to ethanol production. This follows the company's announcement in May that it had begun production of ethanol. The benefits of simultaneously producing isobutanol and ethanol using the SBS are:

1) it facilitates the process optimization of commercial-scale isobutanol production;

2) it maximizes the utilization of the plant to generate cash by utilizing all the fermentation assets; and

3) it demonstrates the simultaneous production of isobutanol and ethanol, for the benefit of potential licensee partners who are interested in augmenting the fermentation capacities of their ethanol plants to co-produce isobutanol.

"The implementation of the SBS is tracking to our plan and validating the underlying premises for switching to this mode of production. Operating all the assets of the plant has aided us greatly in solving issues that were impeding the ramp-up of isobutanol using one fermenter in isolation, specifically the consistent management of infections and the handling of recycle streams and solids," said Dr. Patrick Gruber, Gevo's CEO.

The following are some of the key results achieved thus far:

Isobutanol

- Successfully produced isobutanol at initial run rates of tens of thousands of gallons per month in a commercial-scale one million liter fermenter (in line with previous guidance);

- Isobutanol yields have reached >90% of target based on starch content, up from approximately 70% prior to running SBS;

- Reduced isobutanol batch cash costs by >25% since beginning SBS, with a clear path towards targeted economic rates;

- Produced and sold IDGs® (animal feed from isobutanol production);

- Achieved 100% recycle streams (up from 90%), while consistently producing sterile mash, controlling infections and growing isobutanol producing yeast;

- GIFT® continues to work as designed (controlling the concentration of isobutanol to desired levels in the fermentation broth, by removing and collecting the isobutanol for further downstream processing); and

- No yeast cross-contamination from the ethanol system.

Ethanol

- Produced ethanol at a run rate of approximately 1.5 million gallons per month (above previous guidance of 1.25 million gallons per month);

- Generating revenue of more than $3 million per month at Luverne; and

- No yeast cross-contamination from the isobutanol system.

"By operating in the SBS we have been able to mitigate the recycle, infection, solids handling and plant operability issues. It is satisfying to see that our yeast and GIFT technology work well at commercial scale. Our yields and costs have improved very quickly. And while we have more work to do, I am pleased with our overall progress and look forward to continuing to increase the production levels of isobutanol at the plant. By running the SBS we have dramatically reduced our cash burn at the plant and we are targeting breakeven at Luverne by year end," continued Dr. Gruber.  

"In addition, we are very pleased with the United States District Court's recent decision to stay the patent litigation involving U.S. Patent Nos. 7,851,188 and 7,993,889 that was scheduled to begin on July 21, 2014. This decision should significantly decrease Gevo's legal costs for the foreseeable future. Taken in combination with the improved cash flow profile of the Luverne operations in the SBS, this should dramatically decrease our overall corporate burn going forward."

Read the original press release from Gevo here : Side-by-side Operation Of Luverne Plant On Track

AgWeek

July 28, 2014

By Jerry Hagstrom

WASHINGTON — White House counselor John Podesta told a group of senators July 24 that reduced volumetric requirements for the Renewable Fuel Standard in 2014 are imminent, Sen. Al Franken, D-Minn., said.

Franken said Podesta signaled that the volumetric requirements will be higher than in the Environmental Protection Agency’s initial proposal, but not as high as they would be if EPA followed the volumetric requirements established in the law that is the basis for the RFS.

EPA reduced the requirement for corn-based ethanol after complaints that ethanol use was causing corn prices to rise and higher blends would be required because overall gas use is down.

The agency also reduced the biodiesel and cellulosic biofuel requirements on the basis that industries might not be able to produce enough fuel.

EPA Administrator Gina McCarthy told Agweek she has not established a date to release the volumetric requirements.

“I realize that this particular year is a difficult one,” McCarthy said. “EPA tried to get all the numbers out in the supply system. I think the biofuels industry knows we are working hard, otherwise it wouldn’t take so long.”

The Obama administration, she said, would continue to push the biofuels industry forward.

McCarthy declined to comment on the Podesta meeting because she was not present.

Franken said Podesta came to his office to meet with him and nine other senators, including Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich.

“We made our case that we believe that the levels they set send the wrong signals to the market,” Franken said.

But Franken said he emphasized that EPA’s plan to cut the volumetric requirement for biodiesel to 1.28 billion gallons would be particularly onerous because the industry produced almost 1.8 billion gallons last year.

Franken said the senators told Podesta the administration should retain higher standards because biofuels are domestically produced and create jobs. They also told him the oil industry’s arguments against higher levels of biofuels are wrong and that the oil industry is doing everything in its power to stop gas stations from selling biofuels.

Oil companies have been putting pressure on gas stations not to put in the blender pumps needed to market the fuel, while independents are putting them in, Franken said.

“We can go to E15,” Franken said, adding NASCAR has already proven the fuel works. E15 can be used in all cars made after 2001, he said.

“We think the blend wall is an artificial term,” Franken said, referring to the oil industry’s argument against higher levels of biofuels.

“Oil companies don’t like ethanol, they need it for oxygenation, but any more ethanol is a threat to them, less profits for them. They are doing everything they can to prevent the infrastructure from going into place. It is chicken and egg and an anti-trust thing. Oil companies are telling their gas stations not to put in the blender pumps.”

EPA proposed total renewable fuel at 15.21 billion gallons and cellulosic biofuel standard at 17 million gallons, significantly lower than the original target of 1.75 billion gallons, advanced biofuels at 2.2 billion gallons, and maintaining the biomass-based diesel standard for 2014 and 2015 at the 2013 level of 1.28 billion gallons.

Attending the meeting in addition to Franken and Stabenow were Sens. Heidi Heitkamp, D-N.D., Amy Klobuchar, D-Minn., Tom Harkin, D-Iowa, Patty Murray, D-Wash., Dick Durbin, D-Ill., Maria Cantwell, D-Wash., Sheldon Whitehouse, D-R.I., and Joe Donnelly, D-Ind.

Read the original story here : Senators Push To Maintain RFS

WASHINGTON — White House counselor John Podesta told a group of senators July 24 that reduced volumetric requirements for the Renewable Fuel Standard in 2014 are imminent, Sen. Al Franken, D-Minn., said.

Franken said Podesta signaled that the volumetric requirements will be higher than in the Environmental Protection Agency’s initial proposal, but not as high as they would be if EPA followed the volumetric requirements established in the law that is the basis for the RFS.

EPA reduced the requirement for corn-based ethanol after complaints that ethanol use was causing corn prices to rise and higher blends would be required because overall gas use is down.

The agency also reduced the biodiesel and cellulosic biofuel requirements on the basis that industries might not be able to produce enough fuel.

EPA Administrator Gina McCarthy told Agweek she has not established a date to release the volumetric requirements.

“I realize that this particular year is a difficult one,” McCarthy said. “EPA tried to get all the numbers out in the supply system. I think the biofuels industry knows we are working hard, otherwise it wouldn’t take so long.”

The Obama administration, she said, would continue to push the biofuels industry forward.

McCarthy declined to comment on the Podesta meeting because she was not present.

Franken said Podesta came to his office to meet with him and nine other senators, including Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich.

“We made our case that we believe that the levels they set send the wrong signals to the market,” Franken said.

But Franken said he emphasized that EPA’s plan to cut the volumetric requirement for biodiesel to 1.28 billion gallons would be particularly onerous because the industry produced almost 1.8 billion gallons last year.

Franken said the senators told Podesta the administration should retain higher standards because biofuels are domestically produced and create jobs. They also told him the oil industry’s arguments against higher levels of biofuels are wrong and that the oil industry is doing everything in its power to stop gas stations from selling biofuels.

Oil companies have been putting pressure on gas stations not to put in the blender pumps needed to market the fuel, while independents are putting them in, Franken said.

“We can go to E15,” Franken said, adding NASCAR has already proven the fuel works. E15 can be used in all cars made after 2001, he said.

“We think the blend wall is an artificial term,” Franken said, referring to the oil industry’s argument against higher levels of biofuels.

“Oil companies don’t like ethanol, they need it for oxygenation, but any more ethanol is a threat to them, less profits for them. They are doing everything they can to prevent the infrastructure from going into place. It is chicken and egg and an anti-trust thing. Oil companies are telling their gas stations not to put in the blender pumps.”

EPA proposed total renewable fuel at 15.21 billion gallons and cellulosic biofuel standard at 17 million gallons, significantly lower than the original target of 1.75 billion gallons, advanced biofuels at 2.2 billion gallons, and maintaining the biomass-based diesel standard for 2014 and 2015 at the 2013 level of 1.28 billion gallons.

Attending the meeting in addition to Franken and Stabenow were Sens. Heidi Heitkamp, D-N.D., Amy Klobuchar, D-Minn., Tom Harkin, D-Iowa, Patty Murray, D-Wash., Dick Durbin, D-Ill., Maria Cantwell, D-Wash., Sheldon Whitehouse, D-R.I., and Joe Donnelly, D-Ind.

- See more at: http://www.agweek.com/event/article/id/23743/#sthash.d1rS0b5G.dpuf

Yahoo! Sports

July 25, 2014

For more than three years, NASCAR has run on a race fuel blended with 15 percent American Ethanol, Sunoco Green E15. This Sunday at the Brickyard here in Indianapolis, one of the world's most historically significant tracks, NASCAR will reach a fittingly historic milestone -- 6 million miles competitive racing on the bio-fuel.

"NASCAR conducted an exhaustive analysis before making the seamless transition to Sunoco Green E15, a race fuel blended with 15 percent American Ethanol," said Brian France, NASCAR Chairman and CEO. "As we eclipse 6 million tough competition miles across our three national series, we can definitively say this renewable fuel stands up to our rigorous racing conditions while significantly reducing our impact on the environment. We are proud to celebrate this milestone at Indianapolis Motor Speedway along with our partners at the National Corn Growers Association and Growth Energy."
 
At a ceremony in Indianapolis today, Richard Childress, chairman and CEO of Richard Childress Racing; Tom Buis, CEO at Growth Energy; and Ken Parrent, director of biofuels at Indiana Corn Marketing Council, gathered to recognize the upcoming achievement.
 
The 6-million mile mark is especially significant because it mirrors the 6 million miles of testing conducted by the U.S. Department of Energy to initially approve E15 for all light duty cars and trucks, model year 2001 and newer.  When this milestone is reached, E15 will have been proven as a high performance fuel on both the road and the track. With another 6 million miles of NASCAR real-world racing under its belt, E15 will be definitively established as a reliable, dependable and safe fuel that is environmentally friendly, high performance and a less expensive option for consumers.
 
"Ethanol-blended fuel is greener, cleaner and homegrown. It reduces our dependence on foreign oil, creates jobs right here at home and helps improve our environment. We want consumers to know that E15 is a safe, high performance and reliable option for them that is less expensive and supports hometown jobs when they fill up at the pump," Buis said. "We are excited to celebrate this milestone of 6 million miles raced on Sunoco Green E15 at NASCAR here in Indiana."
 
In 2011, NASCAR and American Ethanol partnered to bring E15 to the sport. Since the beginning of the 2011 season, Sunoco Green E15 has fueled every car and every truck in each of NASCAR's national race series. The introduction of Sunoco Green E15 has been a pivotal part of the NASCAR Green initiative, and has successfully increased horsepower and decreased emissions for the sport.

Read the original story here : NASCAR Reaches 6 Million Miles On Sunoco Green

U.S. Energy NEW logo hi-res SMALL VERSION copy

This month, we spotlight U.S. Energy Services, a leading energy management services provider for ethanol producers in the country. Read our interview with Casey Whelan, Vice President of Strategic Initiatives at U.S. Energy, below.

Whelan

Q. Please tell us about U.S. Energy Services.

A. U.S. Energy Services is a premier energy management company, positioned as a leading expert in analyzing, procuring and managing the energy requirements for large end users. U.S. Energy’s mission is to be our clients’ long-term, preferred energy manager by providing best-in-class energy related services to commercial, industrial, and institutional clients. We create competition between energy suppliers to ensure that our clients pay the lowest possible price. Managing the energy needs of over 3,500 North America sites, our customer list includes half of all the ethanol plants in the United States. U.S. Energy is differentiated by providing unique and specialized services not often offered by competitive energy management companies, such as:

Risk management integrated with physical procurement

Consulting and site development services

Natural Gas and electric portfolio management

LNG, CNG, Ethanol and Biogas services

Sustainability programs

PlantPhotofull frame1

Q. Please tell us about your company's role within the ethanol industry and why the company is committed to supporting the ethanol industry now and in the future?

U.S. Energy has participated in the ethanol and biodiesel space for two decades. We entered the industry in the mid 1990’s working with Heartland Corn, who utilized dry mill technology, and Minnesota Corn Processors, who is a wet mill producer. Since that time, we have worked with more than 100 ethanol plants helping them design and develop energy infrastructure such as natural gas pipelines.

We provide on-going energy management services, mostly in the areas of natural gas and electricity, such as competitive procurement, price risk management, data management, tariff reviews, and infrastructure consulting. We are a committed partner in helping the industry thrive.

chris-monitor 10

Q. From your perspective, what would you like consumers to know about the ethanol industry and the fuel it produces?

A. The ethanol industry produces product which the U.S. needs not only from an energy perspective, but also from an economic perspective. Over the last twenty years, we have visited scores of rural locations where owners have invested in building ethanol plants. These plants have provided significant economic enhancements to the local community.

The ethanol producer’s increased demand for raw product flows directly back to the neighboring residents in the form of higher pricing and more liquid markets for local farmers, lower unemployment and higher labor rates for non-farmers, as well as new restaurants, grocery stores, and other residual businesses surrounding plant activities. Beyond the local community, the benefits of domestically produced ethanol include environmental advantages as well as a reduced dependence on foreign oil.

Q. What do you think is needed for E15 availability to grow?

A. Two important factors are at play in regard to growing E15 usage. First, the EPA must approve all vehicles to utilize E15. This action offers both environmental benefits as well as economic growth for the ethanol industry by providing additional incentive for fuel dealers to provide E15 at the pump. Second, automobile manufacturers must warrant the use of E15 in all vehicles. The threat of a voided warranty de-incentivizes drivers to use E15, and without this component in place, E15 will never reach its full potential.

Q. What do see as the ethanol industry's biggest challenge?

A. The biggest challenge for the industry is continued access to the market. The ethanol industry is trying to push their product into a competitive space occupied by major oil interests. Without federal legislation regarding the use of ethanol in our vehicles, we will limit access to the marketplace leaving environmental and economic barriers in place. If E15 mandates are put in place at a federal level, the Minnesota state legislature would fall in line. Public opinion weighs in as well – negative E15 press in the past has influenced adoption on a broad scale.

Q. What does your company see for the future of ethanol and advanced biofuels?

A. Ethanol is a critical component to the current and future success of the farming industry. The trend lines for corn yield continue to increase – more and more product is available every year. Meanwhile, domestic harvests outweigh food consumption making the ethanol industries demand for corn vital to the United States’ agricultural industry. Every Btu of ethanol produced in the U.S is one less Btu of oil we import from overseas. There is a robust future ahead for the industry as it continues to develop, implement and commercialize advanced biofuels. Progress, however, will be slow.

 

Reuters

July 24, 2014

By Ayesha Rascoe

The U.S. ethanol industry pushed back on Wednesday against what they called a "one size fits all" approach to proposed federal rules for shipping fuel by rail, saying regulators must distinguish between the often corn-based biofuel and crude oil.

Their calls follow an unveiling by the U.S. Department of Transportation of proposed safety features for new tank cars transporting fuel, and the phasing out of older cars considered unsafe.

Developed in response to a string of fiery railcar accidents involving crude oil cargoes, the new rules would also apply to shipments of ethanol.

Biofuel groups said treating both fuels the same is a mistake.

"We shouldn't be forced to pay the bill for somebody else's problem," said Monte Shaw, executive director of the Iowa Renewable Fuels Association.

Over the last 18 months, at least a dozen trains carrying crude oil have derailed. Six of those accidents led to spills and major fires, and one caused the death of 47 people in Lac-Megantic, Quebec.

The U.S. ethanol industry has about 29,000 railcars in its service. The average age of its fleet is nine years old, with each car expected to be in service for 40 to 50 years.

Shaw said his group supports additional regulations to strengthen railcar safety, especially measures that would help prevent accidents, but that new rules should take into account the differences between ethanol and crude oil.

Ethanol is less volatile as crude oil, is biodegradable and has a 99.997 percent rail safety record, according to the national Renewable Fuels Association.

"Unlike oil from fracking, ethanol is not a highly volatile feedstock of unknown and differing quality and characteristics being shipped to a refinery for commercial use," said Bob Dinneen, president of the RFA.

The groups acknowledged that rail transport of ethanol does not come without risks.

In 2009, a train carrying ethanol derailed in Cherry Valley, Illinois, and caught fire, killing a person in a car nearby and injuring several others.

After that accident the National Transportation Safety Board in 2012 recommended safety improvements for certain railcars transporting ethanol and crude oil.

Shaw said the government should look at what makes sense for ethanol as opposed to "one size fits all."

Read the original story here : Ethanol Needs Separate Treatment In U.S. Rail Rules - Biofuel Groups

Star Tribune

July 22, 2014

By Jim Spencer

Democratic U.S. Sen. Amy Klobuchar of Minnesota has joined with Republican colleague Sen. Charles Grassley of Iowa to push federal investigations of alleged restrictions on the sales of ethanol by the nation's major oil companies.

The senators cited a recent report by the Renewable Fuels Association, a trade group representing the ethanol industry, that claims name-brand oil companies unfairly limit sales of ethanol at service stations selling their products.

Klobuchar and Grassley have written to U.S. Atty. Gen. Eric Holder and Federal Trade Commission Chairwoman Edith Ramirez asking them to investigate a number of charges for possible legal and regulatory violations. The senators have asked for "a substantive evaluation of your conclusions regarding possible anticompetitive behavior by certain oil companies and any proposed solutions or actions the DOJ and FTC will take to resolve this issue."   

Among charges leveled by the renewable fuels group at Big Oil:

Brand name service stations can only sell products provided by the oil company.

Sales quotas of branded products discourage the sale of ethanol.

Requirements to store multiple grades of branded gas eliminate the ability to store and sell ethanol.

Oil company demands that ethanol pumps be labeled with "intimidating" warnings about how the fuel can hurt engines.

Forcing dealers to isolate E85 pumps that deliver fuel that is 85 percent ethanol.

Read the original story here : Klobuchar, Grassley Want Probe Of Ethanol Sales Restrictions

See also:

U.S. Senators Press For Probe Of Report That Oil Companies Blocked Ethanol

RFA Scores Retailers For E85, E15 Offerings ; Big Oil Gets An 'F'

RFA Reports Details Big Oil's Tactics In Preventing E85, E15 Sales

 

 

Renewable Fuels Association

July 22, 2014

Ethanol produced in the United States has been the most economically competitive motor fuel in the world over the past four years and has played an important role in reducing consumer fuel costs, according to a new analysis released today by the Renewable Fuels Association (RFA).

The analysis, conducted by ABF Economics, examined actual wholesale prices paid for ethanol, gasoline, and alternative octane sources in several key U.S. and world markets in the 2010–2013 timeframe. Based on the market data, the report concludes that “…U.S.-produced ethanol is an exceptionally competitive additive and fuel source…” and that “…U.S. ethanol has emerged as the lowest cost transportation fuel and octane source in the world over the past several years.”

Commenting on the analysis, RFA President and CEO Bob Dinneen said, “As proven by the recent boom in exports, American-made ethanol has evolved into the most cost competitive transportation fuel and octane source in the world. Through rapid technology adoption and innovation, U.S. producers have proudly earned the distinction of being the global leader and low-cost producer of clean-burning, renewable ethanol.”

“Despite the fact that ethanol offers greater consumer choice at a lower cost, entrenched petroleum companies continue to erect barriers that deny access to larger volumes of renewable fuels,” Dinneen continued. “In a truly free market, consumers would always choose a fuel that is produced domestically, is better for the environment and climate, and costs much less than gasoline. Unfortunately, free markets only exist in text books, underscoring the need for monopoly-breaking policies like the Renewable Fuel Standard.”

The ABF Economics study found that even after accounting for transportation costs to the reference markets of Los Angeles, Chicago, and New York, “The ‘spread’ between ethanol and RBOB [gasoline] has averaged 30 to 40 cents per gallon over the past four years in these three key markets, and the difference averaged more than 60 cents per gallon in 2012.”

As a result of this cost differential, “…ethanol blended with RBOB to produce reformulated gasoline at a 10 percent (E10) blend has reduced the cost of motor fuel to consumers.” Importantly, the author notes that ethanol’s impact on gas prices goes far beyond the wholesale price spread: “This does not include the additional downward impact ethanol has on gasoline prices as a result of extending supplies and reducing demand for crude oil.”

In closing, the study indicates that the competitiveness of U.S. ethanol will only improve in the future: “This competitive advantage is expected to increase further, as U.S. ethanol and feedstock producers adopt new technologies and crude oil prices continue to trend higher.”

Click here to read the report "The Economic Competitiveness Of U.S. Ethanol."

To read the original story, go to : New Analysis: U.S. Ethanol Is Lowest Cost Motor Fuel, Octane Source On The Planet

Ethanol produced in the United States has been the most economically competitive motor fuel in the world over the past four years and has played an important role in reducing consumer fuel costs, according to a new analysis released today by the Renewable Fuels Association (RFA).

The analysis, conducted by ABF Economics, examined actual wholesale prices paid for ethanol, gasoline, and alternative octane sources in several key U.S. and world markets in the 2010–2013 timeframe. Based on the market data, the report concludes that “…U.S.-produced ethanol is an exceptionally competitive additive and fuel source…” and that “…U.S. ethanol has emerged as the lowest cost transportation fuel and octane source in the world over the past several years.”

Commenting on the analysis, RFA President and CEO Bob Dinneen said, “As proven by the recent boom in exports, American-made ethanol has evolved into the most cost competitive transportation fuel and octane source in the world. Through rapid technology adoption and innovation, U.S. producers have proudly earned the distinction of being the global leader and low-cost producer of clean-burning, renewable ethanol.”

“Despite the fact that ethanol offers greater consumer choice at a lower cost, entrenched petroleum companies continue to erect barriers that deny access to larger volumes of renewable fuels,” Dinneen continued. “In a truly free market, consumers would always choose a fuel that is produced domestically, is better for the environment and climate, and costs much less than gasoline. Unfortunately, free markets only exist in text books, underscoring the need for monopoly-breaking policies like the Renewable Fuel Standard.”

The ABF Economics study found that even after accounting for transportation costs to the reference markets of Los Angeles, Chicago, and New York, “The ‘spread’ between ethanol and RBOB [gasoline] has averaged 30 to 40 cents per gallon over the past four years in these three key markets, and the difference averaged more than 60 cents per gallon in 2012.”

As a result of this cost differential, “…ethanol blended with RBOB to produce reformulated gasoline at a 10 percent (E10) blend has reduced the cost of motor fuel to consumers.” Importantly, the author notes that ethanol’s impact on gas prices goes far beyond the wholesale price spread: “This does not include the additional downward impact ethanol has on gasoline prices as a result of extending supplies and reducing demand for crude oil.”

U.S. ethanol isn’t just outcompeting gasoline on price—it is also outperforming ethanol from other key exporting countries, like Brazil. According to the report, “…even with depreciation of the real, U.S. ethanol has been more cost competitive than Brazilian ethanol in key U.S. and world markets over the past several years.” This has particular relevance in the California market, according to the study, because that state’s fuel policies strongly compel fuel suppliers to import Brazilian ethanol in lieu of U.S. ethanol. “Use of Brazilian ethanol in place of U.S. ethanol theoretically raised the price of E10 for California consumers by 8 cents per gallon over the past four years,” the study found.

In closing, the study indicates that the competitiveness of U.S. ethanol will only improve in the future: “This competitive advantage is expected to increase further, as U.S. ethanol and feedstock producers adopt new technologies and crude oil prices continue to trend higher.”

The full report, titled “The Economic Competitiveness of U.S. Ethanol,” is available here.

- See more at: http://www.ethanolrfa.org/news/entry/new-analysis-u.s.-ethanol-is-lowest-cost-motor-fuel-octane-source-on-planet/#sthash.5XLC1VVn.dpuf

Ethanol produced in the United States has been the most economically competitive motor fuel in the world over the past four years and has played an important role in reducing consumer fuel costs, according to a new analysis released today by the Renewable Fuels Association (RFA).

The analysis, conducted by ABF Economics, examined actual wholesale prices paid for ethanol, gasoline, and alternative octane sources in several key U.S. and world markets in the 2010–2013 timeframe. Based on the market data, the report concludes that “…U.S.-produced ethanol is an exceptionally competitive additive and fuel source…” and that “…U.S. ethanol has emerged as the lowest cost transportation fuel and octane source in the world over the past several years.”

Commenting on the analysis, RFA President and CEO Bob Dinneen said, “As proven by the recent boom in exports, American-made ethanol has evolved into the most cost competitive transportation fuel and octane source in the world. Through rapid technology adoption and innovation, U.S. producers have proudly earned the distinction of being the global leader and low-cost producer of clean-burning, renewable ethanol.”

“Despite the fact that ethanol offers greater consumer choice at a lower cost, entrenched petroleum companies continue to erect barriers that deny access to larger volumes of renewable fuels,” Dinneen continued. “In a truly free market, consumers would always choose a fuel that is produced domestically, is better for the environment and climate, and costs much less than gasoline. Unfortunately, free markets only exist in text books, underscoring the need for monopoly-breaking policies like the Renewable Fuel Standard.”

The ABF Economics study found that even after accounting for transportation costs to the reference markets of Los Angeles, Chicago, and New York, “The ‘spread’ between ethanol and RBOB [gasoline] has averaged 30 to 40 cents per gallon over the past four years in these three key markets, and the difference averaged more than 60 cents per gallon in 2012.”

As a result of this cost differential, “…ethanol blended with RBOB to produce reformulated gasoline at a 10 percent (E10) blend has reduced the cost of motor fuel to consumers.” Importantly, the author notes that ethanol’s impact on gas prices goes far beyond the wholesale price spread: “This does not include the additional downward impact ethanol has on gasoline prices as a result of extending supplies and reducing demand for crude oil.”

U.S. ethanol isn’t just outcompeting gasoline on price—it is also outperforming ethanol from other key exporting countries, like Brazil. According to the report, “…even with depreciation of the real, U.S. ethanol has been more cost competitive than Brazilian ethanol in key U.S. and world markets over the past several years.” This has particular relevance in the California market, according to the study, because that state’s fuel policies strongly compel fuel suppliers to import Brazilian ethanol in lieu of U.S. ethanol. “Use of Brazilian ethanol in place of U.S. ethanol theoretically raised the price of E10 for California consumers by 8 cents per gallon over the past four years,” the study found.

In closing, the study indicates that the competitiveness of U.S. ethanol will only improve in the future: “This competitive advantage is expected to increase further, as U.S. ethanol and feedstock producers adopt new technologies and crude oil prices continue to trend higher.”

The full report, titled “The Economic Competitiveness of U.S. Ethanol,” is available here.

- See more at: http://www.ethanolrfa.org/news/entry/new-analysis-u.s.-ethanol-is-lowest-cost-motor-fuel-octane-source-on-planet/#sthash.5XLC1VVn.dpuf