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In the News

EPA Sets 2016 Blending Targets for Ethanol and Other Biofuels

November 30, 2015

By Dave Shaffer

More biofuel will be required to be blended into the nation's fuel supply next year, but the ethanol industry isn't entirely happy about it.

The U.S. Environmental Protection Agency (EPA) on Monday issued final blending requirements under a 2007 renewable fuels law, ordering distributors to mix 8 billion gallons of ethanol, biodiesel and other advanced biofuels into the nation's fuel supply next year.

For the first time, the overall U.S. mandate for corn-based ethanol — about 14.5 billion gallons — will exceed 10 percent of the nation's expected gasoline use. That's intended to spur expansion of higher ethanol blends, such as 15 percent ethanol, or E15, which is now sold at just 36 Minnesota stations.

Almost all regular gasoline in the nation is a 10 percent ethanol blend, and that won't change.

For the ethanol industry, this overall market share has been called the "blend wall" — a barrier to selling more biofuel.

"We have seen a break in the blend wall," said Jeff Broin, chief executive of Poet Inc., the nation's second-largest ethanol producer with four plants in Minnesota.

Broin, who also is chairman of Growth Energy, an ethanol trade group, said the EPA's decision "should move renewable fuels forward." On a conference call, Broin said about 5,000 U.S. fuel stations are on track to install equipment to dispense E15, and he expects the higher-ethanol blend to sell at a discount to regular gasoline. In Minnesota, E15 typically sells for about 10 cents less than unleaded regular.

The 2016 corn-ethanol level is below the 15 billion gallons envisioned in the 2007 law — and is about 1 billion gallons less than the annual capacity of the nation's 212 ethanol plants.

Other ethanol industry leaders and supporters criticized the EPA's decision. The Minnesota Corn Growers called it a "step backward" and the Minnesota Biofuels Association, a state trade group, called it "capitulation to the oil industry" — echoing similar comments from the Renewable Fuels Association, an ethanol trade group based in Washington.

Sen. Al Franken, D-Minn., said the EPA biofuel targets are too low, even though they are higher than the agency proposed earlier this year. "[W]hile I'm glad they raised levels from what was proposed, these final numbers just don't cut it — especially for ethanol," Franken said in a statement.

Oil industry groups, which have fought expanding market share of ethanol, also were critical. "This decision is hard to view as anything other than an attempt by EPA to placate the biofuels lobby," said Chet Thompson, president of the American Fuel & Petrochemical Manufacturers.

Minnesota has 21 corn-ethanol plants, although two are shifting production to other corn-based biochemicals or fuel. Tim Rudnicki, executive director of the Minnesota Biofuels Association, said it's too early to say what effect the EPA decision will have on the state's ethanol industry, but "It certainly seems like a negative to me," he said.

Aside from corn-ethanol, the EPA also set higher blending levels for biodiesel, or diesel fuel made from plants, and advanced biofuels. Janet McCabe, acting assistant administrator for EPA's Office of Air and Radiation, said the rule increases the advanced biofuel blending requirement by 35 percent, but recognizes that cellulosic, ethanol technology hasn't developed as quickly as envisioned by the 2007 law. Cellulosic ethanol has a lower carbon footprint than the corn-based fuel.

Three cellulosic ethanol plants have opened in the past 14 months, including two in Iowa that process non-kernel parts of corn usually left on fields. A third plant in Kansas is owned by Spain-based Abengoa, which has begun insolvency proceedings, said Scott Chabina, a director at New York-based Carl Marks Advisory Group who tracks the industry.

Chabina said the EPA cellulosic ethanol targets could help spur investment in cellulosic ethanol, but that it won't be easy.

Read the original story: EPA Sets 2016 Blending Targets for Ethanol and Other Biofuels

A Big Week Ahead for RFS and Biofuels

Hoosier Ag Today

November 30, 2015

By Gary Truitt

The long awaited Paris Climate Conference gets underway this week. The purpose of the international meeting is to focus on how the world can address factors that are impacting our climate, including carbon and greenhouse gasses. Participants will also try to agree on the text of a new international treaty. Countries will discuss related matters such as forests and funding for poorer countries to deal with climate change. All of the nations are working towards the common goal of limiting greenhouse gas emissions to prevent climate change from getting out of hand. Trying to get 196 countries to agree to anything makes the process slow going.

President Obama will present recommendations from the US on how to reduce carbon and GHG. The oil lobby has been pressuring the administration not to mention biofuels or the Renewable Fuel Standard. Geoff Cooper with the RFA is hopeful the White House will mention one of the few US programs that has been successful in reducing GHG: the RFS, “We are hopeful the President will mention the RFS or renewable fuels in his speech. The RFS has been huge success in reducing carbon emissions in our transportation fuels.” The US is aiming for a reduction of at least 26 per cent below 2005 levels by 2025. How the President plans to achieve this without renewable fuels is baffling to Cooper.

Cooper admits the powerful oil lobby has been working hard to keep renewable energy out of the Paris discussions, “But we are hoping the administration will see through that fog and include the RFS in its discussions in Paris.”

Obama, who has stated he is a climate change authority, has had a mixed record on supporting the RFS and biofuels. In advanced materials sent by the US to the Paris conference, there was no mention of biofuels or the RFS.

Ironically, as the Parris conference begins, the EPA will be releasing its final rule on the level of ethanol that can be blended into gasoline. It is likely the EPA will allow less than the ethanol industry wants and can produce. The RVO rule is expected to be released on Monday.

The location for the conference moves around each year. In 1997, it was in Kyoto, where the famous Kyoto Protocol was written up. In 2009, it was in Copenhagen, a meeting which ended in anti-climax. It was decided two years ago in Warsaw that the 2015 COP21 meeting would be in Paris. Country representatives also have smaller meetings throughout the year, mostly in Bonn, Germany.

Read the original story: A Big Week Ahead for RFS and Biofuels

RFS is Crucial to National Security

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

Ethanol Backers Enlist ‘Bachelor’ Star to Push Fuels Mandate

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

How We Can Free America From the Foreign Oil Cartel

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

Analysis : RFS2 Implementation Has Reduced GHG Emissions By 354 Million Metric Tons

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.

What Facts are Really Facts?

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.

Congress created and approved the RFS.
Businesses planned their investment strategies based upon the RFS.
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.

Ethanol offsets the purchase of foreign oil.
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?

RFA and Growth Meet with OMB and Urge Administration to Uphold the RFS

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

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Member Spotlight : Hydrite Chemical Co

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

Please tell us about Hydrite Chemical Co?

Hydrite 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.

Please 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?

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.

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

To 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

Ethanol Industry Making Profits Despite Lower Price Of Fuel

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.

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.

“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.

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

Fuels America Launches TV Campaign To Counter Anti-RFS Letter

Ethanol Producer Magazine

Nov 12, 2015

Fuels America is announcing a significant television campaign today calling out Rep. Peter Welch (VT-AL) for signing on to a Congressional letter that was authored by oil industry lobbyists. The first phase of the campaign includes 250 GRPs in the Burlington media market for one week.

The ad calls out Rep. Welch for protecting oil company profits and criticizes the 96 signers who are climate change deniers, urging viewers to “Remind Peter Welch to stand up for Vermont, not oil companies and climate deniers.” The 184 Members of Congress who signed on have collectively received more than $39 million from the oil and gas industry throughout their careers. Altogether the signers have an average score of 2.74 from the League of Conservation Voters; 154 have an LCV score below 10, 140 have an LCV score below 5, and 76 have an LCV score of 0.

"After years of pleading with Congressman Welch, it is time to inform Vermonters about his beltway exploits with the oil industry attacking renewable fuels,” Advanced Biofuels Business Council Executive Director Brooke Coleman responded. “Mr. Welch didn't just join an anti-biofuel campaign underwritten by the oil industry, he led the effort to recruit others. It is time to shine a brighter light on those encouraging EPA and the President to gut the renewable fuel standard (RFS). It's not a chorus, it is the oil industry, climate deniers and EPA bashers disguised as one. This letter and the millions of dollars of oil contributions flowing to its signers tell you everything you need to know about the anti-RFS crowd."

Rep. Welch’s letter, released last week, was sent to EPA Administrator McCarthy asking the Administration to gut the Renewable Fuel Standard—America’s most successful policy on the books aimed directly at fighting climate change and reducing greenhouse gas emissions—and a policy which Administrator McCarthy has called a “vital tool” in combatting climate change.

A final rule on the Renewable Fuel Standard for 2014, 2015, and 2016 is expected by the end of the month. President Obama and his Administration must choose to either maintain a strong RFS as Congress intended, or gut the program at the behest of the oil industry.

“Congressman Welch should know better than to accept without question the oil company’s narrative about biofuels,” Bob Dinneen, President and CEO of the Renewable Fuels Association responded. “Of course the oil companies are going to whine they can’t possibly blend any more biofuel than they do today – they don’t want to! Of course they’re going to exaggerate, distort and outright lie about the environmental footprint of biofuels – they don’t want to talk about their own! Congressman Welch should have done his homework. He would have found out that American ethanol has reduced consumer gasoline prices, lowered the taxpayer burden of farm program costs, and incentivized an unprecedented investment in private sector funds in new technologies that are being commercialized today and leading a revolution in biofuels production. None of this would happen if Big Oil had its way.”

The anti-RFS letter by the oil lobby came on top of the release of a letter from 16 members of the Congressional Black Caucus to Administrator McCarthy urging the EPA to support the RFS and showing the major harm to our air and lungs caused by the oil industry, particularly in vulnerable communities. In the same vein, Rep. Donald Payne (NJ-10) recently penned an op-ed in The Hill stressing the climate and public health benefits of the RFS in contrast to fossil fuels’ pollution that disproportionately impacts urban areas and communities of color.

Brent Erickson, Executive Vice President at the Biotechnology Industry Organization (BIO) also weighed in. “The oil industry has been caught red-handed in authoring the letter to EPA Administrator McCarthy and duping 180 lawmakers into putting their names on it. It is very disturbing to see the lengths the oil refining industry will go to distort the record and protect their profits and fuel monopoly.”

Read the original story here : Fuels America Launches TV Campaign To Counter Anti-RFS Letter

NFU Highlights RFS Success

Domestic Fuel.com

Nov 11, 2015

By Joanna Schroeder

Organizations are still reacting to the letter sent by 184 Congressman, including some for top corn producing states, calling on the Environmental Protection Agency (EPA) to reduce the volumes of corn-based ethanol blended into America’s fuel supply as part of the Renewable Fuel Standard (RFS). The EPA has sent their final rule drafts to the Office of Budget and Management (OMB) and the rules are expected to be released by November 30, 2015.

“The RFS has been an unqualified success since its passage in 2005,” said Roger Johnson, president of the National Farmers Union (NFU), in a letter to President Obama. “Wavering from our commitment to the RFS would be a grave mistake for both America’s family farmers and this nation as a whole. We urge you to reject Big Oil’s talking points and stay the course on the RFS.”

Last week NFU released the results of a poll that showed that released a poll that showed popularity and support for political candidates that support the Renewable Fuel Standard within a majority of rural congressional districts in which the poll was conducted.

Johnson stressed in the letter that the RFS has boosted incomes for family farmers while making strides in mitigating climate change through the use of biofuels. He noted that climate change is a threat to both farmers’ operatons and, in turn, the nation’s food security.

“The RFS has helped family farmers and the nation make tangible steps toward mitigating our impact on climate change by driving the U.S. to make real reductions in greenhouse gas (GHG) emissions,” Johnson wrote in the letter. “Corn ethanol reduces GHG emissions by 34 percent, and more substantial gains can be made through new types of biofuels.”

Johnson noted that, unfortunately, most popular public policies face a small but vocal group of critics, and the RFS is no different.

“Earlier this month, a minority of House members sent a letter requesting that the U.S. Environmental Protection Agency (EPA) curb the growth of this promising industry by backing off volume targets set forth in the statute,” said Johnson. “These members are reversing themselves by asking for less ethanol production than was signed into law by President Bush.”

“We deeply appreciate your administration’s demonstrated commitment to mitigating climate change for the sake of domestic and global food security among other things. On behalf of America’s family farmers, we ask you to stay the course on the RFS, maintaining your commitment to biofuels and to fully implementing the statutory volume targets laid out in the law.”

Read the original story here : NFU Highlights RFS Success

Don't Weaken The RFS

The Hill

Nov 10, 2015

By Rep. Donald Payne

For over a century, we have seen fossil fuels pollute our environment, damage our climate, and spew toxic chemicals into the air we breathe. Unfortunately, our most vulnerable communities are hit the hardest from this pollution. Poor air quality affects urban areas and communities of color disproportionately.

To combat the problem, Congress created America’s Renewable Fuel Standard (RFS) in 2005. The RFS is Congress’s answer to lowering greenhouse gas emissions and expanding the nation’s renewable fuels sector while reducing reliance on imported oil. The RFS is the most successful law on the books that cuts greenhouse gas emissions and pollution. In fact, studies have shown that higher renewable fuel blends reduce asthma- and cancer-causing emissions by 6.6 percent compared to regular gasoline.

To help our environment, strengthen public health, stimulate our economy, and boost our confidence in renewable fuels, we must invest in advanced and cellulosic biofuels—the cleanest motor fuel in the world. Advanced biofuels have reduced greenhouse gas emissions by nearly 590 million metric tons, an amount equivalent to taking more than 124 million cars off the road.

The renewable fuel industry is responsible for creating more than 852,000 good, American jobs and generating $184.5 billion in annual economic output. In my home state of New Jersey, the RFS is responsible for $1.6 billion of economic output each year, including $88.3 million in the 10th Congressional District. Lowering the biofuels volume requirement would devastate our economy and threaten the livelihoods of hundreds of thousands of Americans.

The Environmental Protection Agency’s recent proposal on the RFS would weaken the biofuels volume requirements and overturn the progress from the past 10 years of its existence. The EPA’s current proposal is inconsistent with Congress’s intent when it passed the law with strong, bipartisan support. The weakened proposal also runs counter to the Obama administration’s goals on fighting climate change and curbing carbon pollution.

That is why I led a group of colleagues in urging the EPA against reducing the biofuels volume requirement. In addition to the health benefits of reducing greenhouse gases, Congress intended for the RFS to provide an incentive to drive investments in biofuel production and technology. Reducing the biofuels volume requirement could have a chilling effect on innovation, and thus directly affect job creation.

Our communities cannot afford to suffer any longer from the toxic fossil fuel emissions that are hurting public health and leading to a whole host of different health issues, including childhood asthma, emphysema, and chronic bronchitis.

At the end of November 2015, the administration will release its final rule on the RFS biofuels volume requirement. It can and must choose to strengthen the Renewable Fuel Standard and protect our economy, environment, and public health.

Read the original story here : Don't Weaken The RFS

Oil Lobby Had Hand in House Lawmakers’ Anti-Ethanol Note to EPA

Bloomberg Government

November 6, 2015

By Mark Drajem

An odd-bedfellows group of lawmakers — led by an oil-industry ally from Texas and a progressive Vermonter — raised a familiar-sounding concern about ethanol in a letter this week to EPA chief Gina McCarthy.

Their argument that the Environmental Protection Agency is requiring more ethanol than can be safely blended into gasoline has been made repeatedly by the oil industry. The echo in the letter wasn’t a coincidence: A lobbyist for refiner Marathon Petroleum Corp. was listed as an author of early drafts of what was distributed to lawmakers for them to sign on. The company says it offered input, but didn’t write the letter.

Ethanol producers say this shows that a campaign including chain restaurants, chicken producers, small-engine makers and even some environmental groups is being driven by oil producers and refiners, which oppose the mandates of the Renewable Fuel Standard. They found the lobbyist’s name in the letter’s electronic record and shared it with a reporter.

“It’s not hard to see the oil industry’s fingerprints all over this campaign,” said Brooke Coleman, the executive director of the Advanced Biofuels Business Council, which represents biofuel makers. “What this is about is trying to destroy the only competition they have in the marketplace.”

Michael Birsic, the lobbyist for Marathon and a former congressional aide, was listed electronically as the letter’s author.

Seeking Relief

“As you would expect, these types of documents are collaborative in nature,” he wrote in an e-mail. “Marathon Petroleum was one of the collaborators and suggested technical comments. We were not the original or primary author of the letter. We are just one the many interested parties who are seeking relief from the unreasonableness of the RFS mandate.”

Oil and ethanol companies have intensified their battle over the future of the program in recent weeks, as President Barack Obama’s administration prepares to issue long-overdue requirements for the fuel’s use last year, this year and next year.

Blend Wall

Lobbyists representing companies such as Exxon Mobil Corp. and Tesoro Corp.say the EPA’s proposal would force them to blend ethanol in at more than 10 percent of the gasoline supply, breaching what they call the blend wall of how much can be safely used. Ethanol producers say EPA is proposing to illegally cut the requirement for ethanol, and should prod refiners into using higher blends of the fuel.

In recent weeks the debate has a surprising turn, as the oil industry and its allies unveiled a television advertising campaign that argued ethanol is worse for the climate than gasoline. The ads used a quote from former Vice PresidentAl Gore, who won the 2007 Nobel Peace Prize for his work to stop climate change: “First-generation ethanol was a mistake.”

The letter to McCarthy was sent Wednesday and signed by more than 180 lawmakers. The EPA proposal for 2016 “would constitute a breach of the ethanol blendwall, which would cause adverse impacts on American consumers and the economy,” they said. The signers include a wide range of lawmakers, including Vermont Democrat Peter Welch, Virginia Republican Bob Goodlatte and the incoming chairman of the House Ways and Means Committee, Kevin Brady.

Not Aware

Republican congressman Bill Flores of Texas, who first circulated the letter, “was not aware until last week that the letter contained some material which might have originated from a stakeholder,” his spokesman, Andre Castro, said in an e-mail.

Spokespeople for both Welch and Goodlatte, who were signatories of the draft that went around to congressional offices, said the letter came from Flores’ staff.

“Congressman Welch signed on to Congressman Flores’ bipartisan letter to Administrator McCarthy regarding the RFS because it is consistent with his view that the corn ethanol mandate is a well-intentioned flop that is bad for consumers, bad for small engines, bad for farmers, and bad for the environment,” his spokeswoman said in an e-mail.

The EPA has a deadline of the end of this month to set the ethanol mandates.

Read the original story: Oil Lobby Had Hand in House Lawmakers’ Anti-Ethanol Note to EPA

Ethanol Reduces Emissions : Clean Fuels Development Coalition

Biofuels Digest

Nov 9, 2015

By Jim Lane

In Hungary, Clean Fuels Development Coalition Executive Director Douglas Durante said as a way for ethanol to find value beyond limitations of government imposed limits, both in the EU and the U.S., the focus should be on providing clean, low carbon octane to help meet health, climate, and efficiency goals.

In the wake of continuing revelations regarding the Volkswagen emissions problems, Durante said this should lead air quality officials around the world to look again at the often erroneous assumptions and calculations used in determining emissions. Further, a better understanding of the importance of looking at fuels and vehicles as an integrated system would tell a far more positive story than what many current, and outdated models would indicate.

“Despite the lies and the misinformation spread by the petroleum industry, ethanol is a superior fuel and additive to anything out of the oil barrel. Gasoline is a mix of hundreds of different chemicals and hydrocarbons, the worst of which are the toxic, often carcinogenic aromatics”, said Durante. “In the Unites States, EPA is actually required to reduce these harmful components and if we were allowed to splash blend additional volumes of ethanol we would be able to improve fuel quality and protect public health,” he said.

Durante also told the delegates at the F.O. Licht ethanol conference that despite the challenges facing the biofuels industry in regard to political and public support, solutions exist that can easily surmount the imaginary blend wall. “The auto industry continually recognizes the value of ethanol in reducing carbon emissions while providing the octane they need. Positive discussions among the ethanol, agriculture and auto industries as well as the Departments of Energy and Agriculture are focusing on blends of 25, 30 and even 40% in the next decade.”

He said hundreds of millions of dollars are being invested in refueling infrastructure and the industry is working to provide consumers with choice by creating access to the market.

"With vehicles that can use ethanol, and the ability to distribute the fuel, the potential is nearly unlimited for both first and 2nd generation fuels. The opposition to these programs is all about lost market share to the petroluem industry which admittedly funds the opposition we see in all of our countries," said Durante. "Working together we can tell the real story and how biofuels provide a wealth of environmental, energy, and economic benefits."

Read the original story here : Ethanol Reduces Emissions : Clean Fuels Development Coalition

Poll : Rural Americans Support Candidates Who Support RFS

Ethanol Producer Magazine

Nov 5, 2015

By Ann Bailey

It would behoove congressional candidates in the Midwest to support the renewable fuel standard (RFS), according to results from a National Farmers Union poll.

The NFU announced Thursday that poll results of more than 4,000 respondents in six Midwestern congressional districts showed rural voters were more likely to vote for candidates who support the RFS. Given the results of the poll, conducted Oct. 5-7 in congressional districts in Illinois, Missouri, Kansas and South Dakota, Pres. Barack Obama it’s important not only for the good of the environment, but also for Democratic candidates that he get the RFS back on track, Johnson said.

The Obama administration will set the volume obligations for the RFS in the next several weeks. The poll showed support for the RFS outweighed opposition in five of the six congressional districts polled.

“We want the President to understand that this is not only the right policy for the environment but also will do damage to his party,” he said. “Almost all of us in agriculture have been strong supporters of the RFS. If the President make the wrong decision he is likely going to do an awful lot of damage to his candidates.”

In addition, not supporting the RFS would give leverage to the claims of organizations that accuse Obama of being a hypocrite because he is a proponent of legislation that protects the environment, but doesn’t support the RFS.

Support of the RFS likely won’t be a magic elixir for candidates, but it “is a real good multi-vitamin,” said Ryan Fitzpatrick, Third Way Clean Energy Program deputy director. Third Way provided an analysis of the poll, titled “Strong RFS support offers low-risk opportunity for Democrats to connect with voters they need to retake majority.”

“If you are going to have a real tough race, why don’t you take the multi-vitamin?” Fitzpatrick said.

Read the original story here : Poll : Rural Americans Support Candidates Who Support The RFS

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