In the News

The Hill

November 24, 2015

By Jon Soltz

As a veteran, I’ve witnessed fellow servicemen and servicewomen risk life and limb over oil interests in hostile regions, all so we can feed our dependence on foreign oil. That’s one of the many reasons why Congress passed the Renewable Fuel Standard (RFS) into law in 2005. Our leaders saw American-grown renewable fuel as a way to cut our dependence on foreign oil and bolster our energy and national security. They recognized that it’s senseless to keep putting Americans in harm’s way when we are producing renewable fuel right here at home. Biofuels are crucial to our national security, and since the RFS was enacted, our dependence on foreign oil has decreased by more than 55 percent. Biofuels are also a major contributor to job growth in America, creating more than 852,000 annually. 

Lowering the renewable volume requirements under the RFS, as the Environmental Protection Agency (EPA) proposed several months ago, would be disastrous for our country’s energy independence and security. With ongoing instability in the Middle East and so much at stake, continuing to depend on foreign oil is not an option. The RFS is the most successful energy policy in the U.S., and producing secure renewable fuel, like ethanol, in our country is one of our most effective tools at breaking our addiction to foreign oil. But now it’s being attacked by people who only stand to gain from our foreign fossil fuel dependence: the oil industry.

The oil industry’s advocacy for continued dependence on imports from hostile foreign regions cannot be allowed to sway our nation’s energy policy. According to Brigadier General Steven Anderson, there have been 1,200 casualties among American soldiers transporting fuel in Afghanistan and Iraq. We can and must do our part to allow access to and production of homegrown biofuels to lessen our reliance on foreign oil.  

America’s military has recognized that and invested in advanced biofuels to increase its diversity of energy. As the largest consumer of energy in the nation, the Department of Defense has used renewable fuel to insulate itself against price shocks in the rigged global oil market. America cannot control the price and global production of oil, but we can control the fuel we grow right here at home. 

Increasingly, climate security is also playing a role in global stability. As climate change contributes to extreme weather events, we will only see further destabilization throughout the world. So it’s more important than ever that we curb our carbon emissions by diversifying our fuel supply and using increasing amounts of renewable fuel produced in America. After all, the advanced biofuels we’re producing right here at home are the cleanest motor fuels in the world. 

When oil and gas production and pollution are increasingly fouling our land and water and threatening the world’s climate, we need a strong RFS to promote the production of secure energy. We have a choice between dirty oil from volatile regions of the world and homegrown renewable fuel made by America’s farmers and rural communities. We should be finding ways to cut, not increase, our use of oil, despite what the oil industry and its cronies want.

President Obama has said that, “The only way for America’s energy supply to be truly secure is by permanently reducing our dependence on oil.” We have the technology and know-how to make that happen. But we need the Administration to stop standing in the way of this progress. We can ensure our energy security and our national security by taking steps now to cut dependence on foreign energy and develop the resources in our own country. 

The RFS is imperative to our national security, and we can’t let oil companies dictate the safety of our men and women in uniform. If enacted as EPA has initially proposed, the current rule would undermine efforts to break from oil and attempts to move forward with advanced biofuels. We have a solution to our dangerous oil addiction, and we can’t afford to turn back now.

Soltz is an Iraq war veteran and co-founder and chair of VoteVets.org.

Read the original story: RFS is Crucial to National Security

The Hill

November 23, 2015

By Devin Henry

Corn growers have a new pitchman in their campaign to protect the federal ethanol mandate: the “Bachelor.”

Chris Soules, the former star of “The Bachelor” and a contestant on “Dancing with the Stars,” plugs the economic and environmental benefits of ethanol fuel in a new ad campaign a week before regulators are due to finalize new fuel ethanol standards.

“I’ve been able to see first-hand the benefits of renewable fuels,” Soules, a native Iowan, says in the ad. 

He adds that he’s seen the “effect on my family’s enterprise and I’ve seen it affect other families who haven’t even been involved in farming, by providing jobs and cleaner energy and to help us the country diversify our energy resources."

Soules, a fourth-generation farmer, proposed to "The Bachelor" winner Whitney Bischoff at his farm during the season finale earlier this year. 

The ad in which he appears, for Growth Energy, is meant to rebuff arguments from oil groups and those opposed the Renewable Fuel Standard (RFS) who have been running ads around the country questing the RFS’s impact on the environment. 

The ad is running in Iowa, Illinois, Ohio and Indiana, all big corn-producing states. Anti-RFS groups have hit the airwaves in some of those states and others with their message against the mandate.

“This ad is more about the positive benefits of ethanol and not just the policy debate, like we’ve run before and currently are running in Washington,” said Tom Buis, the co-chairman of Growth Energy. 

Federal regulators have a Nov. 30 deadline for finalizing three years of ethanol-blending requirements for gasoline. Both sides have looked to influence public opinion and policymakers on the ethanol mandate in the lead-up to the announcement, and ethanol backers are now deploying Soules to take on those opposed to the mandate.  

“He is a fourth-generation farmer, and that is the real stardom, in my opinion,” Buis said. 

Read the original story Ethanol Backers Enlist ‘Bachelor’ Star to Push Fuels Mandate

St. Louis Post Dispatch

November 22, 2015

By Jim Talent

Ten years ago, Congress took an important step toward the goal of energy independence. By establishing the Renewable Fuel Standard as part of the Energy Policy Act of 2005, Congress sent a clear message that it wanted to kick the addiction to foreign oil through a tried and true solution: American innovation. I was one of the chief authors of the RFS.

Ten years later, the RFS is the government’s most successful energy policy; in fact, it may be the government’s only successful energy policy. It has reduced dependence on foreign oil, created hundreds of thousands of jobs, and also reduced carbon emissions. Despite these achievements, the Environmental Protection Agency wants to move in another direction and actually scale back the RFS.

That’s right. The same federal agency that is promulgating costly regulations to reduce greenhouse gases also wants to weaken a program that is already reducing carbon emissions without costing the economy anything. Given the Obama administration’s emphasis on the climate change issue, the EPA’s hostility to renewable fuels only makes sense as a response to pressure from the oil industry.

The advantages of the RFS are clear. Ten percent of our fuel supply is now derived from biofuels, and our foreign oil imports are at their lowest level in 20 years. At the same time, the price of gasoline at the pump has gone down by over a dollar, in part because most gasoline contains an ethanol blend, and ethanol sells for about $1.60 per gallon. The University of Missouri Extension Service calculates that Missouri’s corn production industry generates approximately $4.3 billion in economic output and sustains 65,960 jobs. Across the river, the collective renewable fuel sector in Illinois generates $17.5 billion of total economic output annually and supports 73,156 jobs, according to the economic research firm of John Dunham & Associates.

Critics of the RFS claim that renewable fuels are subsidized. That’s not true; there are no subsidies or tax breaks for ethanol. At the time the RFS was passed, there were concerns about whether the supply of corn would be adequate to support both food and fuel production. Those of us who authored the RFS believed that it would stimulate efficiencies in corn production that would more than meet the demand. That’s happened; American farmers are growing more corn than ever before on the same amount of acreage.

Critics also claim that the RFS is an intervention in the free market. Actually, it’s the path to a free market for automobile fuel. For 40 years, the price of oil has been controlled by a foreign cartel that does not hesitate to use its market power to crush competitors.

Unsurprisingly, OPEC has already made plans to crush the U.S. oil boom, and regularly strategizes to batter competitors and dominate market share. Last November, OPEC colluded to drop oil prices so that it could squeeze competitors with higher costs. Saudi Arabia was the main architect of this strategy, driving many U.S. fracking companies out of business and into bankruptcy.

It’s alarming when you realize just how much control foreign governments and OPEC oil barons have on our everyday lives and paychecks. But they can’t exercise that power over renewable fuels, because of the RFS. The fact that the largest ethanol plant in the world just opened its doors for business in Iowa — a plant that is powered by discarded corncobs, husks and stalks — is another reminder of what American-style innovation can accomplish if it is allowed to succeed.

If you create a map of the world and size it according to oil reserves, Saudi Arabia is the biggest country by far. But if you size such a map according to agricultural production, the United States is the largest nation. That’s why the RFS was and remains such an important policy.

In the end, the RFS is not about a proposed policy change by a federal agency, it’s about who will be in charge of our nation’s energy. When you consider what is at stake, that’s something worth fighting for.

Jim Talent was U.S. senator representing Missouri from 2002 to 2007. He is the chairman of Americans for Energy Security and Innovation.

Read the original story: How We Can Free America From the Foreign Oil Cartel

Renewable Fuels Association

Nov 20, 2015

WASHINGTON — Biofuels consumed under the expanded Renewable Fuel Standard (RFS2) have reduced U.S. greenhouse gas (GHG) emissions by 354 million metric tons of CO2-equivalent since 2008, according to a new analysis conducted by California-based Life Cycle Associates. The Renewable Fuels Association (RFA), which sponsored the study, said the findings have important implications for both the pending final rule for 2014–2016 RFS volumes and upcoming global climate talks in Paris.

“The RFS2 has resulted in significant GHG reductions, with cumulative CO2 savings of 354 million metric tonnes over the period of implementation,” according to the report. “The GHG reductions are attributed to greater than expected savings from ethanol and other biofuels.” Specifically, the authors ascribe the larger-than-anticipated GHG emissions reductions to: technology improvements in grain ethanol production, increased consumption of low-carbon advanced biofuels, and the steadily rising carbon intensity of petroleum fuels.

Whereas the Environmental Protection Agency (EPA) uses a 2005 petroleum “baseline” for estimating RFS2 emissions impacts, the Life Cycle Associates study uses a “dynamic” petroleum baseline that reflects the true emissions impacts associated with U.S. petroleum consumption. The report, which builds on earlier work regarding marginal petroleum emissions, states that “…the advent of new crude oil extraction and processing technologies has raised the aggregate CI of petroleum fuels above the 2005 (EPA) baseline.”

The study found that conventional corn ethanol reduced emissions by an average of 29 percent when compared to the petroleum actually used in 2008, with that reduction growing to 39 percent by 2015. Importantly, these estimates include the best available estimates of prospective “indirect land use change” emissions from Argonne National Laboratory.

For context, the estimated 352 million metric tons of avoided CO2 emissions resulting from the RFS2 between 2008 and 2015 is equivalent to the annual emissions from 74 million passenger cars or 1.9 million railcars of coal burned. Looked at another way, the RFS2 emissions reductions are equal to the amount of carbon sequestered annually by nearly 300 million acres of forest.

“This report, which uses globally accepted GHG accounting methods, demonstrates that the RFS has been tremendously successful in reducing the carbon intensity of our transportation fuels. In fact, the study found the RFS has actually exceeded expectations in terms of GHG reduction,” said RFA President and CEO Bob Dinneen. “As the Obama Administration considers both its approach to the Paris climate talks and the 2014–2016 RFS final rule, we strongly encourage them to examine this report and think carefully about the carbon impacts of the important policy decisions they are about to make. As documented in the study, the carbon footprint of American biofuels continues to shrink, while the carbon emissions associated with petroleum continue to increase. The RFS has absolutely lived up to its promise of delivering cleaner fuels to consumers, while displacing and delaying the need for increasingly dirty sources of petroleum. Now is the time to renew our national commitment to biofuels—not to walk away from it.”

Read the study here.

Ohio's Country Journal

November 17, 2015

By Matt Reese

It can be really hard to know which way to feel about some issues because these days it seems everyone has their own set of “facts” that conclusively proves their point. The problem, of course, is that as soon as you conclusively prove a point, you run into someone else who has an entirely different set of facts that definitively proves their point, which happens to be the opposite view of the first point that was proven. Confused yet? I know I am.

One only has to sit and listen to a political debate on any issue between any candidates of any party to get all caught up in a muddled mess of my-facts-versus-your-facts. Then there is often a behind-the-scenes reporter who does a fact check on the aforementioned facts to clarify the situation. Unfortunately, more often than not, these fact checks often just compound the problem by providing another opportunity to spin the issue with a set of suspect facts about the facts.

Of course, in my line of work I see this all the time in great detail with the wide variety of complicated issues facing food and agriculture. This is certainly true in the current debate over the Environmental Protection Agency’s impending decision about the levels set in the Renewable Fuel Standard (RFS). The recent story by Joel Penhorwood on this issue highlights the divergent facts in the RFS debate. Here is an excerpt:

ACCF (an anti-ethanol group) Executive Vice President Dave Banks responded strongly to the outcry by Ohio ag and pro-ethanol groups.

“I think these guys sometimes get lost in this weird, parallel universe in which they actually convince themselves that this mountain of damning, definitive science and data about corn ethanol’s environmental impact doesn’t exist, or that folks don’t actually know about it,” Banks said in a statement.

That environmental impact Banks spoke of is one of negative consequence. The ACCF points to research that they say shows the production of ethanol doubles greenhouse emissions when compared to gasoline over 30 years, making it a dirtier fuel in the end — a highly disputed claim. 

“It’s just misinformation,” said Ohio grain farmer Chad Kemp about the anti-RFS ads. “The things they’re saying there is no scientific backing for. They’re trying to get the people to jump on board with it and basically, their idea is to kill renewable fuels in this country.”

The heated debate over the RFS really ramped up in recent weeks with dueling ad campaigns in Ohio and Washington, D.C. highlighting very different sets of facts pertaining to ethanol’s impact on the environment, the economy and so forth. So whose facts are right?

In the end, the complexities of these various issues generally boil down to some basic truths. The key for me is getting down to those basic truths and sorting out how I feel about those. So, here are some facts about the RFS (that are really facts) that helped me to form my opinion.

  1. Congress created and approved the RFS.
  2. Businesses planned their investment strategies based upon the RFS.
  3. The RFS was implemented and businesses responded as they saw fit.

While there are many more nuances to the RFS debate, for me this set of undisputable facts is reason enough to support it. The government made a deal. Regardless of whether you like the deal or not, it was made and I believe it should be upheld and seen through to fruition. Maybe this set of facts doesn’t address your primary concerns about he RFS. Here are more real facts.

  1. Ethanol offsets the purchase of foreign oil.
  2. Ethanol is made from corn produced by American farmers.

I would rather support farmers in the U.S. with my energy dollar than who knows who I am supporting when I use petroleum.

In the end, there is usually at least some kernel of truth in either side of these debates. Which facts matter to you? The way I sort through them is by identifying the key (and real) facts of the matter that really matter to me.

Either way, the RFS is a no-brainer in my book.

Read the original story: What Facts are Really Facts?

Renewable Fuels Association

November 19, 2015

Press Release

EPA-2016-Total-RVO

At a meeting on Wednesday with the Office of Management and Budget (OMB), Bob Dinneen, president and CEO of the Renewable Fuels Association (RFA), and Tom Buis, CEO of Growth Energy, delivered the message that the Renewable Fuel Standard (RFS) is working and that there is no reason for the Environmental Protection Agency (EPA) to set the Renewable Volume Obligations (RVOs) for undifferentiated renewable fuel (primarily corn ethanol) below the levels specified in the statute. EPA is expected to issue the final RFS rule for 2014–2016 on or before Nov. 30. Dinneen said data show the U.S. ethanol industry would have no problem meeting the 15 billion gallon blending level specified by the statute.

“The latest data from the Energy Information Administration show that gasoline consumption projections for 2016 have increased. In fact, EIA expects 2016 gasoline demand to achieve a nine-year high,” said Dinneen, underscoring a recent analysis by RFA. “Our calculations show that because of the uptick in gasoline demand alone, EPA must increase the 2016 RVO by 270 million gallons.

“Additionally, the EPA significantly understated the use of E85 and non-ethanol conventional renewable fuels, including non-advanced renewable diesel and biodiesel, in its proposal. Moreover, USDA’s recent Biofuels Infrastructure Program grants will give consumers greater access to higher blends of ethanol like E85 and E15 through the installation of more than 5,000 blender pumps at 1,400 fueling stations. We provided OMB with data showing that EPA has understated the likely market for E85 and non-ethanol conventional biofuels in 2016 by at least 440 million gallons. All of this suggests there will be at least 14.7 billion gallons of undifferentiated renewable fuel blended next year. With approximately 2 billion surplus RINs credits available for refiners to use for compliance with the RFS, there is simply no reason for the EPA to lower the 2016 RVO below the statutorily imposed level of 15 billion gallons.”

Buis added, “Yesterday we impressed upon OMB the importance of moving the Renewable Fuel Standard forward, not backward. This is a policy that is creating jobs, reducing our dependence on foreign oil, improving our environment, and one that is breaking the near monopoly Big Oil has on the liquid fuels transportation market, providing consumers with a choice and savings at the pump. The data is there to prove the value of the program and it shows the RFS is doing exactly what it was intended to do.”

“This meeting was really our closing argument before the administration makes its final decision. We impressed upon OMB that the oil industry’s ‘blend wall’ narrative is simply not true. The president needs to uphold the statute,” both concluded.

Read the original story: RFA and Growth Meet with OMB and Urge Administration to Uphold the RFS

Hydrite Logo JPEG

This month, we spotlight our newest vendor member, Hydrite Chemical Co. We spoke to Scott Cumming, market development manager -biofuels at Hydrite Chemical, on the company, its position in the ethanol industry and what it sees as the industry's biggest challenge.

Scott Cumming

Scott Cumming, Market Development Manager - Biofuels, Hydrite Chemical

mbaLogo4a Please tell us about Hydrite Chemical Co?

Scott CummingHydrite Chemical Co., established in 1929, is one of the largest and most respected providers of chemicals and related services in the United States. We are proud to partner with hundreds of companies to help them make the best products in the world at the lowest possible cost.

mbaLogo4aPlease tell us about Hydrite's role within the ethanol industry and why the company is committed to supporting the ethanol industry now and in the future?

Scott Cumming Hydrite currently provides corn oil extraction chemistries to the ethanol industry as well as other specialty chemicals for foam control, evaporator  cleaning, and many bulk chemicals. For the near future, Hydrite is leveraging its expertise in sulfur, organic, and food processing to provide additional value added products to boost the earnings potential to our customers. Specifically, Hydrite is utilizing the technical expertise derived from its diverse business units to provide antibiotic free chemistries and efficiency boosting enzymes that will allow producers to contribute more to their bottom line. 

mbaLogo4a What do you see as the ethanol industry's biggest challenge?

Scott CummingTo me, the industry's biggest challenge is battling common misconceptions and continuing to get the message out about the benefits of ethanol  for our country. Just a quick story to illustrate this point, the other day I was returning my rental car at a popular international airport. The friendly customer service agent at the rental car company asked me what I was doing in the area and I mentioned that I had visited an ethanol plant. The agent was very quick (and cordial) to let me know how bad ethanol was to his company's rental cars. 

"This stuff is really bad and damages these cars," he told me. Yet, when pressed (in a friendly manner), he could not remember how many vehicles, which models, or the time of the most recent damage. All he could point out was how bad ethanol was for his vehicles and lawnmowers; suggesting the origins of his misguided comments were from "anti-ethanol" organizations. He was seemingly unaware of all the immense benefits the ethanol industry has had on the US economy including job creation, the reduction in greenhouse gas emissions from ethanol, and a decrease in dependence on foreign oil.

Learn more about Hydrite Chemical Co here

Star Tribune

Nov 17, 2015

By David Shaffer

Low prices at the gas pump have put a persistent squeeze on Midwest ethanol producers, but most are staying profitable.

Of eight Minnesota-affiliated ethanol producers tracked by the Star Tribune, all but one made money in the third quarter, although not like the high profits of 2014.

“The Midwest ethanol industry is healthy,” said Ron Monson, vice president for agribusiness capital at AgStar Financial Services in Apple Valley. “Plants have been able to make money and operate in the environment we have today.”

Low gasoline prices pinch ethanol producers because they sell into the same fuel market. The result is thinner operating margins at ethanol plants, a condition that could persist for 12 to 18 months, according an ethanol industry analysis by the national cooperative bank CoBank.

Valero Energy, the San Antonio-based owner of Minnesota’s largest ethanol plant in the city of Welcome, said its companywide ethanol margins fell by more than half — from $1 a gallon in third quarter 2014 to 47 cents in the same period this year.

“There is just so much oil, and oil refiners have been producing a tremendous amount of gasoline and that has weighed on the gas price,” said Brian Milne, energy editor for Schneider Electric, whose DTN service tracks farm and fuel commodities.

Ethanol sold for more than $2 per gallon on the commodities market during much of 2014. Lately, the front-month contract has been below $1.50 per gallon. Ethanol is blended into gasoline at a rate of 10 percent or more at the pump.

Lower third-quarter revenue

On average, Minnesota-affiliated ethanol refiners reported a 26 percent drop in revenue in the third quarter, which ends in July for most smaller companies and in September for large, multistate producers. The newspaper tracked publicly reported results for companies that own seven of Minnesota’s 21 ethanol plants and two Minnesota companies that own plants in North Dakota and South Dakota.

Midwest AgEnergy, a North Dakota ethanol producer majority-owned by Maple Grove-based Great River Energy, increased sales by 22 percent to $53 million thanks to its new Spiritwood, N.D., plant. But start-up costs triggered a $1.5 million loss for the quarter. Its Dakota Spirit AgEnergy plant went online in June and is now operating at above its 65 million gallon per year capacity, said Chief Operating Officer Jeff Zueger.

“We are projecting it to be, long-term, a very profitable entity,” said Zueger, who noted that the plant, like its sibling Blue Flint Ethanol in Underwood, N.D., gets steam for plant processes from an adjacent Great River Energy power plant, cutting operating costs.

Some good signs

Not all signs are negative for the ethanol sector.

Monson said corn is plentiful, with good levels of starch needed to ferment alcohol, and the price has remained below $4 per bushel for months. Corn is the main ingredient in ethanol and its largest single cost.

“Farmers would like a better price, but it is what it is,” Monson said.

Americans also are driving more, which has boosted demand for gasoline by 3 percent this year. Monson and others say that fuel demand, thanks partly to low prices, is projected to increase 1 percent or more in 2016.

“With gas being under $2.50 [per gallon] for quite a few months, that seems to have stimulated driving and it’s probably an indication that the economy is getting stronger,” he added. “We don’t see that changing.”

Exports also have remained strong for ethanol and its animal-feed co-product called dried distillers grains, helping to offset domestic price pressures. Green Plains, the Omaha-based ethanol producer that owns large plants in Fairmont and Fergus Falls, Minn., said it exported 21 percent of its production in the third quarter.

“[W]e are there every day aggressively trying to … export gallons as we focus continually on getting more product offshore,” Todd Becker, Green Plains chief executive, told analysts recently.

Brazil, a major ethanol producer, recently increased its domestic fuel blending to 27 percent ethanol, which has curbed that nation’s ability to export its cane sugar-based biofuel, CoBank said in its industry outlook. That’s an opportunity for U.S. producers, although CoBank warned that U.S. ethanol exports need to grow by 22 percent to 39 percent over the next two years to keep the nation’s 214 ethanol plants operating at 90 percent of their capacity.

Ethanol makers also are hopeful that domestic sales will rise as more gas stations are equipped to dispense 15 percent ethanol blends. The U.S. Department of Agriculture in October announced details of its $100 million matching grant program, saying 1,400 gas stations, including 165 in Minnesota, will get help converting pumps and tanks to dispense E15.

E15 is approved by the federal government for 2001 and newer cars. At some stations, a gallon of E15 sells for 10 cents less than regular E10. Zueger said that discount is possible because the value of extra renewable fuel credits is passed on to consumers.

For the first time, Zueger said, the program will help gas stations replace or add tanks to dispense E15. Those projects take time, but the domestic market impact could be felt later next year.

“It will open the door for folks to offer this product,” Zueger added.

Read the original story here : Ethanol Industry Making Profits Despite Lower Price Of Fuel