In the News
April 25, 2017
By Ann Bailey
The benefits in feeding distillers grains are well known—it’s an economical, nutritious, palatable addition to livestock and poultry rations. Less well known are its environmental benefits that range from reducing methane emissions from cattle to minimizing phosphorus content in manure and the risk from runoff into waterways. These little-known benefits are something that University of Minnesota professor and animal nutritionist Gerald (Jerry) Shurson believes the ethanol industry should tout.
“We’re entering an era where we have to think about the environmental impact of feed ingredients,” Shurson says. One of the biggest challenges today is to sustainably produce enough nutritious, safe and affordable food for a growing population, while at the same time preserving natural resources and minimizing negative impacts on the environment. Food demand is projected to increase 70 percent between 2010 and 2050 and the growing middle class is expected to have 1.8 times more consumer buying power, allowing more people to be able to buy more milk, meat and eggs, he says. Meeting the goal of feeding the world sustainably will be multidimensional, requiring innovations in production techniques and systems that increase the efficiency and amount of food produced, while preserving finite natural resources, protecting ecosystems and biodiversity, and mitigating the effects of global climate change, Shurson says.
Estimates indicate about 14 percent of human-produced greenhouse gas (GHG) emissions globally come from the livestock sector, Shurson says. While 14 percent is not a huge contribution to the total, nonetheless, it is significant and there are opportunities for the livestock industry to play a significant part in reducing greenhouse gases. Growing consumer concern about the effect the global livestock industry has on the environment and climate change is prompting integrated livestock and poultry producers and food production companies to begin emphasizing supply chain management to reduce their carbon footprints, Shurson says. “In other words, in addition to nutrition and economic value, they are also sourcing ingredients that have less negative impact on the environment.” Feed ingredients are beginning to be classified by renewable and nonrenewable resource use, acidification and eutrophication potential, and contribution to GHG emissions, he says.
DDGS can play an important role. In 2015, the ethanol industry produced roughly 37 million metric tons of DDGS for export and domestic use. Historically, most of the corn coproduct was fed to dairy and beef cattle, but because ethanol and DDGS production has greatly increased during the past 15 years, the need to build the market has increased, both domestically and overseas. Inclusion rates for dairy and beef cattle have also risen and demand from other livestock sectors, such as swine, poultry and aquaculture, both domestically and overseas, has increased.
Methane, Phosphorus Benefits
One side effect of increasing the inclusion rate of DDGS in the diet of dairy cows is it increases the amount of corn oil consumed. Several studies have shown that raising dietary fat content reduces methane production, Shurson notes. That’s important because methane is a significant contributor to greenhouse gas emissions. “The reduction in methane production in cattle is a positive environmental story that makes DDGS even more attractive, beyond its economic and performance benefits.”
On top of reducing methane emission in cows, feeding distillers grains brings an important environmental benefit to poultry and swine operations. “One of the unique advantages of using DDGS in swine and poultry diets is that it contains a greater concentration of digestible phosphorus than all other grains and grain coproducts, which can dramatically reduce the amount of phosphorus excretion in manure,” Shurson says.
“Whatever is not digested and absorbed by the animal comes out in the manure, so there is a dramatic reduction in phosphorus excretion in manure when adding DDGS to these diets.”
The reduced phosphorus content in manure from pigs and poultry fed DDGS means that when manure is applied to soil, there is less phosphorus runoff into rivers, lakes and streams, Shurson says.
“Because we take corn and put it through a fermentation process with yeast in an ethanol plant, that process converts much of the indigestible phosphorus into a digestible form which is important to pigs and poultry.” Less risk of runoff into waterways Shurson says, minimizes the risk of eutrophication, which can lead to algae blooms and fish kill, if it’s severe enough.
Another environmental advantage of the high digestibility of phosphorus in DDGS is that animal nutritionists can reduce inorganic phosphorus supplementation, Shurson says. “Some experts have predicted that within the next 20 years, our natural phosphate reserves around the world will be close to being depleted, so there’s a big amount of interest, and even organizations, focused on phosphorus conservation.” Distillers dried grains plays a big role because it is not only high in phosphorus content, but the phosphorus is more digestible, reducing the pressure on inorganic reserves, he says. “That’s a good thing from a long-term environmental perspective.”
Besides having positive environmental benefits, reducing the amount of inorganic phosphates in the animals’ diets is cost effective, Shurson adds. “Inorganic phosphate sources are relatively expensive and phosphorus is the third most expensive nutritional component in animal feeds. Using more DDGS to replace inorganic phosphate supplements reduces diet cost when diets are formulated on a digestible phosphorus basis.”
On top of reducing the amount of methane in cattle and phosphorus in pigs, DDGS also have potential to mitigate the smell in commercial swine operations. Some studies have shown that the amount of hydrogen sulfide emitted from stored manure is reduced in pigs that are fed 30 percent DDGS diets compared with corn-soybean meal diets, Shurson says, which reduces odor in manure storage pits. Odor reduction is a significant advantage because as urban areas move closer to large confinement operations, complaints about the smell emitted from the manure storage pits increase, Shurson says.
Telling the Story
Historically, the focus of nutritionists and livestock producers has been on minimizing costs while optimizing animal performance. That will continue, Shurson says, but there are already signs that environmental concerns will add another level to purchasing decision. “What I’m suggesting is, we’re entering an era where we have to think about the environmental impact of feed ingredients, because global agriculture is projected to represent more than 50 percent of total agricultural economic value in the next 10 years,” he says. The growing middle class in China and other Asian countries, together with an increasing global population, will result in the production of more food animals than ever before, Shurson notes. Furthermore, driven by consumer desire, food companies and major livestock and poultry integrators are beginning to make claims that the food they produce is, among other things, environmentally friendly, he says. The business models of companies such as Walmart, Smithfield Foods and Pepsico are putting more emphasis on limiting environmental impacts in response to those concerns.
Because DDGS are a significant global feed ingredient, Shurson believes the ethanol industry has an important story to tell. “A lot of companies are talking about, and struggling with, how they can move toward a bioeconomy. The role of ethanol and its major coproduct, DDGS, contribute to a positive environmental story. I’ve begun introducing these positive environmental impact stories in many of my presentations at feed conferences in the U.S. and overseas.”
Measuring the Impact
Feeding food-producing animals diets that reduce the negative effect on the environment is important because it is something that can have an appreciable, measurable effect, says Jennifer Schmitt, program director and lead scientist at the NorthStar Initiative for Sustainable Enterprise, a program at the Institute on the Environment at the University of Minnesota. During the next year, Schmitt will be working on a project with Shurson and Pedro Urriola, University of Minnesota animal science research assistant professor, that will look at how four hog diets affect the life-cycle (cradle to grave) environmental impact of hog production. One of the diets will contain DDGS, another food waste, a third, phytase enzymes and a fourth, synthetic amino acids. Hogs were chosen for the project because their digestive systems can handle a wider variety of feeds than animals such as dairy and beef cattle.
“If we can show ways to improve the environmental impacts with pork, we can reduce the overall environmental burden of meat animals,” Schmitt says. “Meat consumption has large environmental impacts in the world, so if we want to address greenhouse gas emissions, water use, water quality, land use, etc., we must either decrease meat consumption in the world or have more sustainable meat production.” It is unlikely total world meat consumption will decrease because the middle class is expected to grow and they will be eating more, not less, meat, Schmitt says. That means that finding a more sustainable way to produce meat is important. Manure management is the No. 1 environmental “hot spot” or the largest contributor, to the greenhouse gases associated with hog production. Second is production of corn feed products, followed by in-home consumption, which includes food waste, she says. “If we can hit those big hot spots and make improvements, we can have environmental gains.”
Read the original story: Untold Story of DDGS’ Positive Environmental Impact
April 19, 2017
By Emily Druckman
Gasoline consumed in the United States in 2016 contained more than 10% ethanol on average for the first time ever, according to an analysis of U.S. Energy Information Administration (EIA) data released today by the Renewable Fuels Association (RFA). The EIA data dispels the myth that 10% is the marketplace limit for ethanol content in U.S. gasoline, and demonstrates that the so-called “blend wall” is not a real constraint on ethanol consumption.
According to EIA data, finished motor gasoline consumption totaled 143.367 billion gallons in 2016. That volume of gasoline contained 14.399 billion gallons of ethanol, meaning the average ethanol content of gasoline consumed in 2016 was 10.04%. According to the RFA report, the data “…further underscore that statutory Renewable Fuel Standard (RFS) blending obligations in excess of the 10.0% level can be readily satisfied by the marketplace.”
Growing consumption of E15 (gasoline blends containing 15% ethanol), mid-level blends (containing 20-50% ethanol) and flex fuels (containing 51-83% ethanol) was responsible for the increase in the average ethanol content of U.S. gasoline in 2016. The RFA report finds that 2016 consumption of mid-level blends and flex fuels was at least 450 million gallons, and may have been more than 1 billion gallons if the American Petroleum Institute’s (API) assertions about ethanol-free gasoline (E0) demand are correct.
A summary of key findings include:
• National average ethanol content was 10.0% or higher in six of the last seven months of 2016, culminating with a record high monthly rate of 10.30% in December.
• On a weekly basis, the ethanol blend rate hit a weekly record of 10.41% in early January 2017.
• These data undermine the assertion by API and others that the gasoline market cannot accommodate more than 9.7% ethanol due to purported infrastructure and vehicle constraints. April 2015 was the last time average ethanol content was below 9.7%.
• Using the most conservative assumptions, EIA data imply that 447 million gallons of mid-level blends and flex fuels (containing 313 million gals. of ethanol) were consumed in 2016.
• However, if API’s assumptions about E0 demand are used, then consumption of mid-level blends and flex fuels was 1.2 to 1.7 billion gallons (843 mil. to 1.17 bil. gals. of ethanol).
“EIA’s data once again shows that the oil industry’s blend wall narrative is bankrupt, intended only to mislead consumers and undermine support for the Renewable Fuel Standard,” said RFA President and CEO Bob Dinneen. “The facts provide a different narrative. Ethanol is the lowest cost and cleanest burning source of octane today. Driven by the RFS and attractive blending economics, domestic refiners and blenders used more ethanol in 2016 than ever before and it’s likely that trend will continue this year. Consumers are gravitating toward E15, E85, and other mid-level blends where they are available. The oil industry can no longer claim the blend wall is any barrier to the effective implementation of the RFS.”
“Additionally, with EPA poised to soon issue its proposed 2018 RFS renewable volume obligations, this analysis unequivocally proves the agency needs to implement the 15 billion gallon statutory requirement for conventional biofuel. A strong RFS benefits consumers with cleaner air, greater energy security and a boost to local economies. We look forward to EPA implementing a strong RFS for 2018,” Dinneen added.
To view a copy of the analysis click here.
Read the original story: U.S. Gasoline Contained More than 10% Ethanol in 2016, Shattering the ‘Blend Wall’ Myth Once and For All
April 6, 2017
News Release:
MINNETONKA, Minn., USA, – Developments in cellulosic ethanol technology, including a collaboration between Syngenta and Cellulosic Ethanol Technologies, LLC, are viewed as opportunities to help grow demand for Earth-friendly American ethanol.
According to Miloud Araba, head of Enogen® technical services at Syngenta, cellulosic innovation could enable dry grind ethanol producers to capitalize on steadily increasing Renewable Fuel Standard (RFS) volume requirements for cellulosic biofuels, which are up 35 percent for 2017.1 Araba discussed opportunities for cellulosic ethanol at the 2017 National Ethanol Conference.
“Approximately 10 percent of the corn kernel dry weight is fiber, and converting corn kernel fiber feedstock to cellulosic ethanol has been possible for some time,” Araba said. “However, recent advances in technologies can enable commercial deployment today. In fact, the approximately 12 million tons of corn kernel fiber feedstock already available at U.S. dry grind ethanol plants each year could produce a potential 1.5 billion gallons of additional, cellulosic ethanol.”
Araba added that the California Low Carbon Fuel Standard (LCFS) offers further opportunities for corn kernel fiber. “Low carbon intensity fuel that puts out fewer emissions will be increasingly needed in California to meet the goals of the LCFS program and the demand for LCFS credits,” he said. “Looking ahead, cellulosic ethanol from corn kernel fiber will be in demand because long-term objectives of the LCFS cannot be met with D6 ethanol at 10 percent.”2
In 2014, the U.S. Environmental Protection Agency added corn kernel fiber to the list of qualifying cellulosic biofuel feedstocks as part of the RFS. That same year, using Cellerate™ process technology, Quad County Corn Processors (QCCP) was the first commercial cellulosic facility – using corn kernel fiber as feedstock – and achieved EPA certification to generate D3 RINs. Through November 2016, QCCP’s output represented approximately 85 percent of D3 RIN ethanol produced. To date, QCCP has produced more than 5.5 million gallons of cellulosic ethanol.
Araba added that Cellerate enables an ethanol plant to leverage its existing infrastructure to produce cellulosic ethanol and significantly increase throughput. Performance results achieved at QCCP to date include: a six percent yield increase plus a 20 percent throughput increase combined for a 26 percent increase in ethanol production3; higher protein feed co-products; and improved oil yield.
“In addition to improvements in throughput and yield, Cellerate enhanced by Enogen® corn enzyme technology drives corn oil yield, leads to increased protein levels and lower residual starch content in co-products,” Araba said. “Protein increases were observed immediately after Cellerate was integrated at QCCP in July of 2014. Initial feed formulation evaluations have shown that Cellerate can lead to an increase in the value of feed co-products, as well as potential access to higher value feed markets.”4
For Cellerate technical inquiries, or a tour of the Cellerate process at QCCP, please contact This email address is being protected from spambots. You need JavaScript enabled to view it.">Tim Tierney with Syngenta at 612-801-9775 or Travis Brotherson with QCCP at 712-282-4628. Learn more about Cellerate process technology at www.Enogen.com
Read the original release: Syngenta Discusses the Future of Cellulosic Ethanol and Opportunities for Dry Grind Ethanol Producers
April 7, 2017
By Rachel Gantz
This morning, the American Petroleum Institute will issue yet another push poll, claiming that a majority of Americans oppose the Renewable Fuel Standard (RFS). But repeating the same tired, skewed results doesn’t make it true.
If past is prologue, API will have framed its RFS polling questions to be biased against the biofuels program. Take API’s April 2016 polling results. Here’s API’s first misleading question:
“As you may know, much of the gasoline in the U.S. market currently contains up to a 10% ethanol blend. Most auto manufacturers have said they will not cover vehicle damage caused by higher ethanol fuel blends over 10% if the vehicle is not specifically designed for it. Given that situation, how concerned are you about government requirements that would increase the amount of ethanol in gasoline?”
What’s the truth? The RFS does not require consumers to purchase increasing—or any—biofuels in their fuel, while ethanol blends of up to 15% are approved for approximately 90% of the vehicles on U.S. roads today.
Think API’s new push poll will be any different? Neither do we.
Here’s the truth. Nearly sixty percent of those polled in a recent national survey support the RFS.
The survey, conducted in late March by Morning Consult on behalf of the Renewable Fuels Association, found that 58% of those polled support the RFS, with only 17% of those polled opposed to the RFS. That’s a more than 3:1 margin of support for the RFS.
“Consumers all across our country are seeing the benefits of the RFS, whether it’s cleaner air, a reduction in our dependence on petroleum or a boost to local economies,” said RFA President and CEO Bob Dinneen. “The RFS has been an unmitigated success, stimulating growth in domestic renewable fuels, creating a value-added market for farmers and providing choice at the pump for consumers.”
“It’s no wonder that API, which represents petroleum producers, wants to obfuscate the success of a program that boosts the production and use of renewable fuel. Consumers want a choice at the pump and the RFS helps ensure that choice exists. API can release all the push polls it wants, but the truth speaks for itself,” Dinneen added.
Read the original release: API Push Poll Doesn’t Reflect Reality
April 4, 2017
By Renewable Fuels Association
U.S. ethanol exports hit 138 million gallons in February, the third-highest monthly volume on record, according to government data released today and analyzed by the Renewable Fuels Association. The February total falls short of only two other months—November 2011 (152.5 mg) and December 2011 (172.7 mg).
Brazil was again the top customer, taking in more than one-third of all U.S. ethanol exports (50.8 mg, or 37 percent) but 14 percent less than record shipments to Brazil in January. Canada also decreased its purchases in February with 24.7 mg (18 percent of total exports) entering the country. Sales to India, however, nearly doubled from the prior month, increasing from 13.2 mg to 24.3 mg. The United Arab Emirates (10.1 mg) and the Philippines (7.0 mg) were other significant importers in February. Year-to-date exports stood at 259.8 mg, up nearly 70 percent from the year-ago total of 154.1 mg.
Exports of U.S. undenatured fuel ethanol rose by 14 percent over January to a record volume of 106.3 mg—nearly double the quantity shipped two months prior. About half of the undenatured product (50.8 mg) went to Brazil. India received a quarter of U.S. undenatured fuel ethanol (24.2 mg), up 118 percent from its January intake. The UAE (10.1 mg) and Philippines (7.0 mg) rounded out top markets for undenatured fuel ethanol. Denatured fuel ethanol exports in February experienced a slight uptick, rising 1 percent to 26.7 mg. Canada and Peru again accounted for the bulk of the market, receiving 23.6 mg (88 percent) and 3.0 mg (11 percent), respectively.
Exports of distillers grains hit 1.07 million metric tons (mmt) in February, the highest monthly total in six months and up 14 percent over January. Mexico expanded its purchases by 36 percent to 241,249 mt (23 percent of total U.S. exports), firmly holding on to its status as the top DDGS destination for a third straight month. Similarly, the Turkish market has been expanding, with a 21 percent increase in DDGS exports in February to 152,537 mt (14 percent). Thailand (71,838 mt), China (64,534 mt), Japan (62,562 mt), Indonesia (58,934 mt), and Spain (58,263 mt) were other top markets, and together with Mexico and Turkey, accounted for two-thirds of February exports. The remaining one-third of DDGS was distributed to 29 countries around the globe. Year-to-date exports stood at 2.01 million metric tons.
Read the original story: RFA: February Ethanol Exports Neared Record, DDGS Shipments Rose
April 3, 2017
By Cindy Zimmerman
A new Department of Energy (DOE) study shows that military veterans make up a significant share of America’s ethanol industry workforce which is not only larger than any other energy sector but more than twice the national average.
Nearly one in five ethanol industry employees is a veteran (18.9%), compared to a national average of 7% across all sectors of the workforce, according to the DOE study. The study also finds that the ethanol industry employs twice as many veterans as the oil and gas sector and nearly four times as many veterans as the coal and nuclear power generation sectors. Other renewable energy sectors, including advanced biofuels, wind and solar, also employ a relatively large share of military veterans.
These statistics confirm what veterans working in the ethanol industry have been saying recently, like East Kansas Agri-Energy (EKAE) CEO Jeff Oestmann, a former U.S. Marine who recently organized a letter from industry vets urging President Trump to include renewable fuels in his energy plan.
Nine of the 52 employees at EKAE are veterans, which is very close to the national average. “Working and investing in the ethanol industry allows us to continue honoring our commitment to making America stronger and more independent,” said Oestmann during the recent National Ethanol Conference.
Read the original story: Ethanol Workforce Big on Military Vets
March 31, 2017
By State Representative Mary Franson
The ethanol industry contributed over $1.98 billion to Minnesota's economy in 2016. However, recent news surrounding the Renewable Fuel Standard (RFS), which regulates blending volumes in fuel, threatens to significantly impact this important market and severely affect our state's economy.
First, the White House is currently debating a change to the RFS point of obligation. Shifting the point of obligation would essentially overturn the current RFS structure and likely prevent future expansion of ethanol blending.
This potential market uncertainty is compounded by the fact that the Environmental Protection Agency is set to take full control over the RFS after 2022. The EPA would then have complete authority to reduce or eliminate corn ethanol from blending standards. This would cause a decline in ethanol production, which would raise fuel prices for consumers, and devastate business for both the ethanol producers and the Minnesota corn farmers that supply them.
As a state representative, I am firmly against policy changes that could negatively impact some of our state's most lucrative industries. Ethanol production is crucial to the state's economy and Minnesota should capitalize on this market instead of allowing government regulation to hinder its potential.
Farmers and ethanol producers should not have to rely on the RFS. If ethanol were allowed to compete in a free market, I believe corn ethanol would thrive in the fuel marketplace and continue providing economic growth and opportunity for Minnesota.
Read the original letter: LETTER: Ethanol Production is Crucial for Economy
March 28, 2017
By Emily Skor
An important debate is happening in the nation’s capital, and it revolves around the efforts by biofuel critics to rewrite a key element of the Renewable Fuel Standard—the point of obligation.
Under the RFS, the point of obligation defines which participants in the fuel supply chain (currently oil refiners and importers) are responsible for ensuring that biofuel blends reach consumers. To comply with the law, refiners that don’t add biofuels to the mix must purchase credits from other market participants. These credits are known as renewable identification numbers (RINs), and the current system creates strong financial incentive for retailers to sell higher biofuel blends. In turn, this has allowed us to rapidly expand the market for affordable consumer options such as E15.
Now, a small group of refiners are working to secure an exemption from the RFS by shifting the obligation to retailers and fuel distributors. This would not only eliminate the incentive to sell higher biofuel blends, it would create a logistical and regulatory nightmare in fuel markets. Hundreds, if not thousands, of retailers would suddenly be required to demonstrate compliance—demanding new rules, new staff, new infrastructure and years of recalibrating a program that already works. The three-year delay we experienced in biofuel targets before 2016 from the U.S. EPA is just a sample of what could occur. Worse, the savings that consumers now enjoy thanks to homegrown biofuels could evaporate, raising costs and depressing the market for renewable fuels.
At a time when rural communities are suffering and grain surpluses are rising, this is a regulatory scheme that cannot be allowed. Farmers are already facing a fourth straight year of declining income, down nearly 50 percent from 2013, according to the USDA.
The sales pitch by refiners is hardly new. They’ve attempted to make this change for years. And, as always, the biofuels industry has stood united with farmers, distributors, retailers and other market participants to protect the RFS. Just recently, Growth Energy rallied with a broad coalition of trade groups representing everyone from the American Highway Users Alliance to the National Association of Convenience Stores to oppose changes to the point of obligation. Even other refiners like Tesoro agree.
The reason our critics are wrong is simple—the RFS is working, exactly as intended. In fact, the flexible system for trading RINs was originally created at the behest of the oil companies. Infrastructure is being deployed, and the number of stations selling E15 doubled last year, thanks to our efforts with programs like Prime the Pump.
The small band of refiners seeking to change the rules are the same group that have worked for over 11 years to gut the RFS. More recently, the owner of CVR refining, Carl Icahn, has even sought to convince biofuel advocates that sacrificing the RFS should be acceptable in exchange for a long-sought waiver from an unnecessary and outdated regulatory barrier that limits summer sales of E15. But without any incentive to sell higher biofuel blends, those sales would never take place, and retailers that have worked hand-in-hand with ethanol producers to offer new consumer options would be left at the mercy of oil refiners. To capture these summer sales, we need a functional RFS and a real fix for Reid vapor pressure (RVP) limits, such as the bill recently introduced by our biofuel champions in Congress, including Sens. Deb Fischer, R-Neb., Joe Donnelly, D-Ind., and Chuck Grassley, R-Iowa, as well as Reps. Adrian Smith, R-Neb., and Dave Loebsack, D-Iowa.
To win these fights, we must stand united. This industry is strongest when we all work together. Our critics are too well-financed and too sophisticated for anything less. I’ve seen this first-hand since taking the helm at Growth Energy almost a year ago. In that time, Growth Energy has worked side-by-side with dedicated champions from across our industry to strengthen the RFS and protect the growth of our industry and the jobs it provides. It hasn’t always been easy, but if we stand strong, we can ensure that fuel retailers have the certainty they need to invest in growth and help consumers gain access to cleaner, more affordable choices at the pump.
Read the original story: To Win RFS Fights, We Must Stand United
More...
March 21, 2017
By Ron Kotrba
March 21 represents the end of the 60-day freeze period on new regulations pending review, implemented by the incoming U.S. administration Jan. 20. Among the regulations on hold during the two-month freeze period was the final rule for the 2017-’18 renewable volume obligations (RVO) under the Renewable Fuel Standard.
While U.S. EPA has yet to announce anything on the matter, biodiesel and renewable diesel stakeholders welcome implementation of the boosted advanced biofuel volumes for 2017 and biomass-based diesel volumes for 2018, finalized by the Obama administration’s EPA last November after Donald J. Trump won the presidential election.
The advanced biofuel category for 2017 was finalized at 4.28 billion ethanol-equivalent gallons, up 19 percent over the 2016 RVO and up 7 percent from the 2017 proposal issued in spring 2016. The biomass-based diesel category for 2018 was finalized last November at 2.1 billion gallons, up 100 million from 2017, the same as what EPA proposed last spring.
“Though last year’s market actually outpaced the 2018 requirement, we are pleased that the rule is effective and that the industry can move forward under the program as outlined,” said Anne Steckel, vice president of federal affairs with the National Biodiesel Board. “With the help of a strong RFS, American biodiesel supports some 64,000 jobs across the nation, many the most affluent in their region. We look forward to working with EPA and the new administration as they begin the process of setting volumes moving forward and are confident American biodiesel producers can do even more to contribute to energy security, economic prosperity and clean air.”
Renewable diesel producer Neste Corp., which exported more than 200 million gallons of renewable diesel to the U.S. in 2016, also commented on the expiration of the regulatory freeze period.
“The regulatory freeze pending review by the new U.S. administration, which was applied to the renewable fuel volume requirements for 2017, has expired,” the company stated in a press release March 21. “Hence, the EPA continues to implement the final ruling under the RFS program as published Nov. 23.”
Kaisa Hietala, executive vice president of Neste’s renewable products business area, said, “We are pleased with the EPA’s continued commitment to the RFS program. Determination and ambitious targets are required to combat climate change globally.”
Read the original story: 2017-'18 RVOs Assumed Intact as Regulatory Freeze Deadline Passes
March 18, 2017
By Bob Shaw
Dump it today, drive with it tomorrow.
That’s the promise of the nation’s first waste-to-ethanol plant, proposed for Inver Grove Heights.
The $200 million biofuels plant would process Dakota County’s garbage into ethanol, to be blended with gasoline for use in cars and trucks.
If the plant works as described, it would make the county more environmentally friendly, said county Environmental Resources Director Georg Fischer.
The plant would be built by the Canadian company Enerkem Inc. and SKB Environmental Inc., a St. Paul-based waste and recycling company. The companies made a preliminary presentation to the Inver Grove Heights City Council in February but have not yet made any formal proposals to the city.
“There seems to be a potential for a lot of benefits, but there are also a lot of unknowns,” said city administrator Joe Lynch.
If the council and state and federal agencies approve, the plant could be operating by 2020, according to David McDonnell, Enerkem’s vice president for business development for North America.
The companies would build the plant near existing landfills, south of 117th Street and about 1 mile west of U.S. 52.
The plant would employ 100 workers and would pay Inver Grove Heights about $1.5 million annually in fees and taxes. “Economically, there is an attraction here,” Lynch said.
Enerkem operates two waste-to-ethanol plants in Canada. One is a small demonstration facility at the company’s headquarters in Quebec, and the other is a commercial plant for the 800,000-population city of Edmonton.
The Minnesota plant would be the first in the U.S. and would be twice of the size of the Edmonton plant.
Dakota County’s Fischer described how the plant could revolutionize garbage processing for the county, which produces 400,000 tons of garbage a year — half recycled and half going into landfills.
At the biofuels plant, workers would pick through the garbage destined for landfills a second time for recyclables, boosting the county’s recycling rate from 50 percent to about 70 percent, according to Fischer. The remaining material would be shredded into 2-inch pieces, heated and processed into ethanol.
The garbage-based ethanol, just like corn-based ethanol, would be blended into automotive fuels. The plant would produce about 20 million gallons of ethanol annually.
There’s another environmental advantage to the plant — the re-use of water.
McDonnell said Enerkem likes the site because the plant could use water from the Empire Wastewater Treatment Facility in Empire Township. The Empire plant processes sewage from the metro area and pipes the wastewater to the Mississippi River.
If the ethanol plant used that water, it wouldn’t have to pump water up from aquifers.
The savings? About 1.6 million gallons annually.
“If they were able to do that, it would become more and more of a green project,” Fischer said.
He said that by slashing the volume of garbage going into landfills, the plant would help the county meet environmental goals set by the state.
State law lists environmental practices from worst to best: landfilling, landfilling that captures flammable gases, composting or burning garbage, composting yard waste and food waste, recycling, and reduction and re-use.
The biofuels plant, said Fischer, would move Dakota County up two levels. “In that respect, it would be a great thing,” he said.
The waste-to-ethanol process is so new that many environmental groups and the Environmental Protection Agency don’t list it under methods they have evaluated.
The EPA’s website, like Minnesota’s waste-management hierarchy, places “energy recovery” in the mid-range of treatment options. Presumably, “energy recovery” would include turning garbage into ethanol.
“The process, if it works as they say, could potentially be a good alternative for us,” said city administrator Lynch.
Read the original release: Inver Grove Plant Would be First in U.S. to Turn Garbage Into Ethanol
March 19, 2017
By Jim Lane
The state of Louisiana has become the 29th state to offer consumers what Growth Energy termed “a better choice at the pump – gasoline blended with 15 percent ethanol known as E15.”
E15 saves consumers an average of 5 to 10 cents per gallon and burns cleaner and cooler than regular gasoline, allowing engines to perform at their peak while reducing drivers’ impact on the environment. The latest in this market expansion is a RaceTrac station in Baton Rouge – now one of 672 locations nationwide to offer Americans this more affordable, cleaner biofuel. Growth Energy applauds RaceTrac and all additional major retailers who currently sell E15 including Sheetz, Kum and Go, Thorntons, Minnoco, Murphy USA, MAPCO, Family Express, Cenex, and Protec Fuels.
“The ethanol industry stands ready to provide American drivers with this performance-boosting, homegrown fuel and with every new pump offering E15, we are doing just that. Growth Energy is committed to working with our retail partners to continue this expansion,” Growth Energy CEO Emily Skor said.
“American consumers have surpassed 750 million miles on E15. When given the option, consumers choose E15, and, thanks to dedicated retailers who care about their customers, more Americans can make this choice.”
Read the original story: Louisiana Becomes 29th State to Adopt E15 Ethanol
March 16, 2017
By Susanne Retka Schill
Ethanol critics bash the fuel for its lower energy value than gasoline, while ethanol supporters point to its octane-boosting properties. University of Illinois ag economists Scott Irwin and Darrel Good analyze the value of ethanol in blended gasoline over the past decade based on those components in a recent FarmDoc Daily post, “On the Value of Ethanol in the Gasoline Blend.”
Much of the analysis of the cost of ethanol relative to CBOB has ignored the potential benefit of the octane-enhancing qualities, particularly in the face of the reported retooling of refineries to producer lower-octane base fuels that need to be oxygenated to meet specifications. Many analyses focus only on ethanol’s energy deficit compared to gasoline, the economists point out.
The economists lay out their methodology underlying their economic analysis to determine the net benefit of ethanol, when looking at energy-adjustments and octane-enhancements. The analysis includes charts that compare the price of ethanol to CBOB, and then the energy-adjusted price of ethanol, which increases due to its lower Btu content. It also looks at the cost of aromatics, the petroleum-based oxygenates used instead of ethanol, and the shift in use from aromatics to ethanol in one state over the past decade.
“As expected, the energy-adjusted price of ethanol (assuming ethanol has only two-thirds the energy value of CBOB) was consistently higher than the price of CBOB by an average of $1.02 per gallon. On the other hand, the price of ethanol was consistently below the price of aromatics, considered as alternative octane enhancers, by an average of $1.06 per gallon.” That calculates to the net value of ethanol, which though just 4 cents per gallon, calculates to “nearly $7 billion over the nine-year period from 2008 through 2016.”
The net benefit was highest in 2012 during the decade examined, Irwin and Good report. “The reason is that gasoline prices were high enough relative to ethanol to reduce the energy penalty, while at the same time lofty aromatic prices drove the octane premium to high levels. The large negative net value in 2016 is essentially driven by the reverse of the 2012 price patterns.”
Limitations to the analysis, the authors point out, include other factors not examined that could impact value, such as the value of Reid vapor pressure and the lower energy value of aromatics. “The bottom-line is that a refinery optimization model is needed to conduct a complete analysis of value of ethanol in the gasoline blend. Nonetheless, our analysis points out the partial and misleading nature of work that only focuses on the energy penalty of ethanol and ignores the octane premium.”
To view the complete analysis click here.
Read the original story: Economists: Octane Premium Offsets Ethanol Energy Penalty
March 16, 2017
By EPM Staff
Nearly two dozen U.S. senators have signed a letter advising President Trump not to change the federal biofuels program's longtime compliance protocol.
Sen. Chuck Grassley, R-Iowa, and Sen. Amy Klobuchar, D-Minn., today led 23 senators in a bipartisan letter urging President Trump to maintain the Renewable Fuels Standard’s point of obligation and reject proposed changes that, they say, would upend the current system.
“We believe such changes are unwarranted and indefensible,” the senators wrote to Trump. “We appreciate the commitment you have made to support the RFS. We strongly urge you to steer clear of administrative changes to the policy that would undermine the program and run contrary to your goals of promoting domestic energy independence and more choices at the pump. We look forward to working with you to ensure the RFS continues to provide the stability and predictability that is creating jobs and economic growth across the country.”
The senators outlined the detrimental effects of changing the point of obligation from refiners to blenders, marketers or retailers, as one prominent refiner is suggesting. The letter said shifting the point of obligation would give refiners little incentive to produce necessary fuel blends, making it difficult for downstream entities to comply.
Changing the point of obligation also would “result in a massive, costly, time-consuming shift in compliance” because small businesses, especially in rural areas, lack the resources needed to comply. Administration of the program would become complicated and “unnecessarily result in significant uncertainty and market disruptions,” the senators wrote.
Such a change is widely opposed—by fuel marketers, retailers, truck stop operators, petroleum producers and renewable fuel producers—because of the added complexity and the undermining of investments that businesses have made to comply, the senators wrote. “The overwhelming majority of transportation fuel market participants oppose any change to the point of obligation because it would cause massive disruptions and could lead to higher prices for consumers,” the letter states.
Responding to the letter immediately, Brooke Coleman, executive director of the Advanced Biofuels Business Council, said, “We applaud champions in the Senate for rallying against changes to the RFS that would harm consumers, threaten the growth of U.S. biofuels and jeopardize investments in clean, American energy."
Coleman continued, "The RFS has worked effectively for more than 11 years to foster market access for homegrown biofuels, and efforts to rewrite the point of obligation are categorically opposed by a broad coalition of biofuel producers, retailers, consumers, and other market participants. Restructuring the program would halt any progress under the RFS, creating regulatory chaos for retailers and dragging down economic growth in rural America.”
Growth Energy CEO Emily Skor issued the following statement in response to the letter:
“Growth Energy thanks Sen. Grassley, Sen. Klobuchar, and the other 21 senators leading this important effort to support the Renewable Fuel Standard, the nation’s most successful energy policy. The point of obligation is a vital component of the RFS and is working as intended to make sure that consumers have a choice of fuel at the gas pump. Growth Energy has consistently opposed any change in the point of obligation.
“The fact is, shifting the point of obligation from refiners and importers to fuel marketers, convenience stores, railroads, truck stops and trucking companies, and even consumer service companies like FedEx and UPS, would throw the RFS into chaos. A change would immediately trigger long and complicated rulemaking that would take years to complete. It would create long-term uncertainty in the entire marketplace and reduce consumer choice at the gas pump by removing the economic incentive for retailers to offer higher biofuel blends, ultimately raising prices on consumers.
“The vast majority of the industry remains united in its opposition to any change to the point of obligation. An America-first energy policy means American consumers can access cleaner, more affordable biofuel options at every gas station nationwide. This is an issue where there is no room to equivocate or barter – preserving the point of obligation is essential to maintaining a strong RFS and growing ethanol demand in the U.S.
“We stand proudly with these 23 senators in opposition to this change and will continue to fight for the ethanol industry and rural America.”
The senators’ letter is available here.
Read the original story: Senators Urge Trump to Maintain RFS Point of Obligation
March 6, 2017
By Lance Klatt
There has been a lot of news coverage recently about changing the point of obligation associated with the Renewable Fuel Standard (RFS). Some seek to shift the responsibility of adding biofuels into the fuel mix downstream to fuel marketers, rather than those who produce or import gasoline.
As operators of locally owned fueling stations, we wish to clarify that this change would harm fuel marketers, retailers and our customers. In fact, hundreds of single-store owners spearheaded the adoption of the first blender pumps, which allow individual stations to offer options like gasoline blended with 15 percent ethanol (E15) and E85. In the Twin Cities alone, there are 34 locally owned Minnoco gas stations selling E15 and other higher blends of ethanol, with more on the way. The number of Minnesota gas stations selling E15 gasoline doubled in 2016.
Chains like Kum & Go, Murphy USA and Sheetz have caught on, too. Today, retailers can blend their own ethanol or buy ethanol blends at a deep discount from distributors and pass the savings on to consumers. This business model makes single stores more competitive, while reducing costs for our customers. Not only is ethanol more affordable, but it also boosts the octane content of fuel, giving our consumers more appealing options for their vehicles.
Retail outlets owned or under contract with a few oil industry giants aren't always allowed to sell new blends like E15, which is becoming commonplace at more and more fueling sites. This corporate resistance to renewable energy actually benefits small retailers who can offer customers a cleaner, better-performing and more affordable option at the pump.
On the other hand, requiring fuel marketers to meet the Renewable Fuel Standard compliance would open hundreds of fuel retailers to potential new Environmental Protection Agency (EPA) compliance requirements. The change would threaten investments made under the current RFS and force the EPA to fundamentally restructure the fuels market, creating turmoil for retailers, producers, distributors, and consumers.
Further, as the end-user of the fuel, fuel retailers are not able to determine the composition of the fuel provided by refiners. As a result, changing the RFS would not only deprive retailers of valuable sales opportunities, but it could also impose dramatically higher costs on consumers or even result in the withdrawal of options from the marketplace.
That is why more than 35 organizations — including the National Association of Truckstop Operators (NATSO), NACS, the Association for Convenience & Fuel Retailing; and the Society of Independent Gasoline Marketers of America (SIGMA) — have all voiced opposition to changes in the RFS.
In exchange for yielding to demands from refining moguls like Carl Icahn, who would profit from a change in the point of obligation, RFS critics have reportedly even offered to endorse a long-sought waiver from the EPA's outdated Reid Vapor Pressure (RVP) limits, which complicate sales of E15 during the summer driving season. That's a commonsense change, with bipartisan support, but it would lose any value to retailers if the incentive to offer blends containing homegrown biofuels were to evaporate.
Of course, there are other reasons to support ethanol. Corn-based ethanol is an earth-friendly biofuel that reduces carbon emissions by an average of 43 percent, according to the U.S. Department of Agriculture. And with advanced biofuels, like cellulosic ethanol, carbon savings can rise to 100 percent or more, according to experts at the Department of Energy's Argonne National Laboratory.
Ethanol production also supports nearly 400,000 U.S. jobs, including many in states like Minnesota, which is home to 20 ethanol plants and one biobutanol plant, with a combined ethanol production capacity of more than 1 billion gallons.
No one benefits when a few massive entities can monopolize our fueling options. Biofuels provide a clean, homegrown alternative that protects consumers — and by extension, fuel retailers — from spikes in oil prices. We shouldn't let a few special interests stand in the way.
Rewriting the RFS now to benefit the refining sector would create a logistical nightmare for fuel retailers, raise costs, and threaten the future deployment of clean, American energy.
Read the original story: COMMENTARY: Small Retailers Against Changing RFS Point of Obligation
March 09, 2017
News Release
In 2016, the United States was again the world’s largest net exporter of ethanol, according to U.S. Department of Agriculture (USDA) trade data and as demonstrated in this U.S. Grains Council (USGC) chart of note.
Net exports are calculated as the difference between exports and imports. The 2016 calendar year concluded with U.S. net exports of 838 million gallons, the second highest level ever, exceeded only in 2011. U.S. ethanol shipments exceeded 1 billion gallons, and incoming shipments totaled nearly 215 million gallons in 2016.
For a majority of the 2000s, Brazil was the largest net exporter of ethanol in the world, and the United States was among the world’s largest net importers. The United States started as a net exporter of ethanol in 2010, exporting more than 410 million gallons and importing more than 131 million gallons that year.
By 2011, U.S. exports rose so sharply (more than 1.2 billion gallons) that the United States seized the top world net exporter of ethanol slot from Brazil. However, the drought in the 2012/2013 marketing year decreased the competitiveness of U.S. ethanol in global markets, cutting global exports. In 2014, U.S. net ethanol exports rebounded, exceeding Brazil’s net exports by 166 million gallons.
Today, the United States is both a major ethanol exporter and one of the world’s largest importers. Roughly 85 percent of U.S. ethanol imports originate from Brazil, with most imports entering the United States through the Gulf ports (largely Houston-Galveston) and West Coast ports (California).
Brazilian ethanol imported into Houston-Galveston is processed into ETBE (a fuel oxygenate) and then re-exported to Japan to meet that country’s strict greenhouse gas criteria, which favors Brazilian ethanol over U.S. ethanol. This is one issue USGC and its partners are working to address as part of their ethanol market development efforts in Japan.
The importation of Brazilian ethanol into California is driven by the state’s Low Carbon Fuel Standard (LCFS), which favors sugarcane ethanol over Midwest corn ethanol based on California’s calculation of carbon intensity. This year, however, the United States has imported very little Brazilian ethanol due to the much lower price for U.S. corn ethanol relative to Brazilian ethanol.
Conversely, U.S. ethanol exports to Brazil have increased substantially due to the price disparity relative to competitively-priced corn ethanol. The relatively high price of sugar compared to ethanol has redirected Brazilian sugarcane into sugar production rather than ethanol. As a result, Brazil has increased its imports of price-competitive U.S. ethanol to meet growing fuel ethanol demand, a trend USGC expects to continue through much of 2017.
Find more about USGC ethanol programs here.
Read the original release: Chart of Note: The U.S. Is The Top World Net Exporter Of Ethanol
March 8, 2017
By Eric Wolff
A consumer advocacy group is filing a complaint to Congress on Wednesday accusing President Donald Trump's friend and fellow billionaire Carl Icahn of violating lobbying rules by pushing the White House to change the federal ethanol regulations.
Public Citizen contends that Icahn, his company Icahn Enterprises and the CVR oil refining company he owns failed to register as lobbyists, yet pushed the White House to change the EPA's decade-old rules on ethanol — a move that would save Icahn's company hundreds of millions of dollars.
Trump named Icahn, whose net worth is pegged by Forbes at nearly $22 billion, as the White House's special adviser for regulatory reform in December, but said he would "not be serving as a federal employee or a special government employee and will not have any specific duties."
Icahn has aggressively advocated for the change in the ethanol rules under the EPA's Renewable Fuel Standard since last year, and according to the Public Citizen complaint, he submitted a proposal to the White House on Feb. 27 to overhaul the program and shift the burden for complying with the ethanol rules to fuel wholesalers. The RFS, which was created by Congress, gives EPA authority to operate the nation's biofuels program.
The letter to the secretary of the Senate and the clerk of the House calls for an investigation into whether Icahn and CVR's activities constitute lobbying of the White House for changes to the program. The complaint also cites Icahn's work in helping select EPA Administrator Scott Pruitt, and the proposed language he and fellow oil refiner Valero Energy submitted to the White House for a memo that would direct EPA to make the change.
"All of this has occurred with no record of any [Lobbying Disclosure Act] filings by or on behalf of Mr. Icahn, Icahn Enterprises or CVR Energy," the complaint reads. "It is unlikely that all these activities occurred without some individual or entity being obligated to report lobbying activity under the LDA."
The letter is latest controversy around the ethical complications that Trump, the wealthy members of his Cabinet and his advisers have faced because of their myriad business holdings.
Read the entire filed letter here.
Read the original story: Trump Adviser Icahn Accused of Breaching Lobbying Rules