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Grassley Statement on Northey Confirmation, RFS White House Meeting

Senator Chuck Grassley

February 27, 2018

Press Release

WASHINGTON – U.S. Sens. Chuck Grassley and Joni Ernst of Iowa today held a joint press conference call to discuss their meeting with President Trump and others at the White House, as well as the confirmation of Iowa Secretary of Agriculture Bill Northey to serve at USDA as Undersecretary for Farm Production and Conservation. Audio of the press call is available here. Grassley’s statement:

“Today Senator Ernst and I met with President Trump, Senator Cruz, Senator Toomey, EPA Administrator Pruitt, USDA Secretary Perdue and White House staff. I reminded President Trump of his commitment to maintaining 15 billion gallons a year of ethanol under the RFS, and his commitment to biofuels, agriculture and rural America.

“No deal on RFS reform was reached at the White House meeting. And no assurances or commitments were made to change the RFS ahead of the meeting. Senator Ernst and I attended the meeting because we are always willing to meet with our colleagues to engage in good faith discussions on any topic, especially when the President is involved.

“I understand the President is concerned any time an American’s job could be lost. I am too, which is why I strongly support the U.S. biofuels industry, which 50,000 Iowans depend on for their livelihoods. But ethanol isn’t just important to Iowa. It’s important to 14 other states in the Midwest, and to our national security.

“The potential loss of more than 1,000 jobs at PES would be devastating for the families affected. I’m glad we have a President who cares about these blue-collar workers. It’s important though that we are honest with ourselves when examining these issues. If we don’t look at the facts before reaching conclusions, it becomes harder to fix problems. Every independent study indicates that other factors, not RIN prices, led to the bankruptcy of PES. Notably, merchant refiners in Texas and elsewhere are recording record profits.

“Senator Ernst and I suggested specific policy changes that would be a win-win for biofuels and oil. But we’ve made it clear all along that a cap or waiver credit for RINs would not be a win-win. It would undercut demand for ethanol and undermine the integrity of the RFS. Farm jobs and blue-collar energy production jobs would be lost as a result. I appreciate that President Trump wants to look out for domestic energy production workers. That does not need to be at the expense of ethanol production. The RFS shouldn’t be gutted for interests seeking market advantage in disguise.

“I’m glad that the unrelated hold on Bill Northey was lifted, and he has been confirmed by voice vote. Bill Northey’s nomination to USDA has never had anything to do with a program administered by EPA. Secretary Northey is a highly qualified and honorable man. He and his family waited long enough. I’m looking forward to Secretary Northey’s swearing-in so he can get to work for American agriculture and farmers.”

Read the original release: Grassley Statement on Northey Confirmation, RFS White House Meeting

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Biofuels and Electric Vehicles Key to EU Decarbonisation, Report Claims

Biofuels International

February 20, 2018

A new report from the International Renewable Energy Agency (IRENA) says the EU could double the renewable share in its energy mix, cost effectively, from 17% in 2015 to 34% in 2030.

In order to reach long term decarbonisation goals, the report argues that all renewable transport options – both biofuels and electric vehicles, are necessary.

The report also argues that biomass will remain a key renewable energy source through to 2030 and beyond. Earlier this year, a Eurostat report argued that although wood biomass was the biggest contributor to the EU’s renewable energy supply, the mix was shifting. The Eurostat figures suggesting the rate of increase in wood biomass sources was not keeping pace with wind, solar and other renewables.

The IRENA report argues all EU countries have ‘cost-effective’ potential to use more renewables.

“Tapping the additional renewable energy potentials identified in the study would propel the EU further on a decarbonisation pathway compatible with the ‘well-below’ 2°C objective established in the Paris Agreement,” a statement announcing the report explains.

The new report comes as part of the Remap EU study, which is aiming to identify cost-effective renewable energy options across all Member States, sectors and technologies in a bid to meet and possibly exceed the proposed 27% renewables target for 2030.

2030 cost savings

According to IRENA, current plans for renewable energy deployment would result in a renewables share of 24% by 2030. The authors identify three categories of through which additional potential could be realised.

Significantly, the study notes that the first category – renewable power generation (wind, solar, hydro and thermal) could lead to strong cost savings compared to conventional technologies. The second category – which relates to the heat and transport sector and covers both electrification and biodiesel, delivers cost-neutrality to moderate savings. The third category, which involves different forms of biomass across sectors, would come at an additional cost.

However, it’s noted that full implementation of all the identified options would result in net cost savings of $25 billion (€20 billion) a year, with the savings from the cheapest options outweighing the costs of the most expensive.

Read the original article: Biofuels and Electric Vehicles Key to EU Decarbonisation, Report Claims

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Analysis: RIN Prices of ‘Just a Few Cents’ are Coming—Without Changes to RFS

Renewable Fuels Association

February 16, 2018

By Emily Druckman

A new analysis from the University of Illinois shows that the conditions that caused high conventional biofuel (D6) RIN prices are changing rapidly and that “…it is not out of the realm of possibility for D6 RINs prices to fall back their pre-2013 level of just a few cents without making any changes to the RFS.”

The authors argue that high D6 RIN prices have been driven by the “gap” that exists between domestic ethanol consumption (estimated at 14.5 billion gallons in 2017) and the 15-billion-gallon statutory requirement for conventional renewable fuels. The size of that “gap” continues to shrink rapidly as E10, E15, and E85 blending has expanded. Thus, as that expansion continues at a rapid pace, the “gap” will be fully closed and RIN prices will fall dramatically. As the Renewable Fuels Association has pointed out, this is exactly how the RFS was intended to work. Establishing RVP parity for E15 would certainly help accelerate the closing of that gap. Specific findings from the University of Illinois report include:

“What seems to have gotten lost in all the noise surrounding the political war over the RFS is how rapidly the conditions are changing that created the high ethanol RINs prices in the first place. The key is the “gap” between the ethanol blend wall and the conventional ethanol mandate.”

“With the statutory conventional ethanol mandate fixed at 15 billion gallons, the growth in ethanol use has led to a sharp decline in the magnitude of the conventional gap. In particular, the latest ethanol use estimate from the EIA for 2019 implies a conventional gap of a little less than 300 million gallons. This gap is so small that an increase in projected ethanol use for 2019 of just two percent would erase the gap completely.”

The bottom-line from this analysis is that the conventional ethanol gap is well on its way to being eliminated in the next few years, even without a large expansion in the use of higher ethanol blends such as E15 and E85. If this does occur, the impact on D6 ethanol RINs prices could be almost as profound as what we witnessed in 2013, but in exactly the opposite direction.

“It is not out of the realm of possibility for the price of D6 RINs to go back to their pre-2013 level of just a few cents. Of course, this assumes that the conditions that have been driving ethanol consumption upward do not change. Even if conditions do change, the size of the conventional gap is much more manageable than just a few years ago and opens the door for very modest increases in E15 and/or E85 to close the conventional gap. For example, a 300 million gallon conventional gap could be eliminated with an increase in E15 consumption of just 2 billion gallons, or about 1.3 percent of total gasoline consumption.”

“This means it is not out of the realm of possibility for D6 RINs prices to fall back their pre-2013 level of just a few cents without making any changes to the RFS.”

“The first supposed ‘blend wall’ was the 10% ethanol blend level. Well, we crashed through that last year and are now blending above 10.0% nationally,” said Renewable Fuels Association President and CEO Bob Dinneen. “But the next blend wall is the 15-billion-gallon allotment for conventional ethanol.  With increased E15 and E85 blending, we are careening toward smashing that wall as well. It seems, however, that the closer we come to that wall, the more intent some refiners become in hitting the brakes, insisting upon RFS demand destruction as the only safe course. This analysis lays waste to that false premise, and demonstrates, as we have insisted for years, that increased ethanol use will also break the 15-billion-gallon wall and lead to lower RIN prices. And RVP parity for E15 would lower RIN prices even more quickly while leaving the RFS intact. Now that’s a win-win,” he added.

Read the original analysis: Analysis: RIN Prices of ‘Just a Few Cents’ are Coming—Without Changes to RFS

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Ethanol to Aid Engine Efficiency Improvements, Emission Reduction

Ethanol Producer Magazine

February 15, 2018

by Renewable Fuels Association

The Renewable Fuels Association today hailed the release of two studies by the Department of Energy that find ethanol-based high octane fuels can deliver substantial fuel economy improvements and emissions reductions when paired with optimized internal combustion engines.

The studies are part of the DOE’s Co-Optimization of Engines & Fuels initiative (Co-Optima), which is focused on identifying coordinated fuel and engine technology pathways that can improve passenger vehicle performance and reduce greenhouse gas emissions.

DOE started by analyzing the properties of dozens of potential liquid fuel components to determine which blendstocks offer the greatest potential to provide efficieny and emissions benefits in internal combustion engines. In the end, the study narrowed the pallet of fuel options down to the eight most promising high-octane blendstocks that could be blended into gasoline for better performance. These blendstocks, co-optimized with advanced gasoline engines, show potential to improve passenger vehicle fuel economy by 10 percent.

The study found that alcohol fuels, including ethanol, offer many desirable properties that will help achieve the goals of greater fuel economy and lower emissions. “Alcohols generally impart high Research Octane Number (RON), octane sensitivity, and heat of vaporization when blended into representative gasoline blendstocks,” the study found.

DOE scored the various fuel components using “merit function” criteria that focuses on the fuel’s: ability to improve engine efficiency; ability to meet current critical fuel-quality requirements; and whether there were any “showstopper” barriers to introducing these blendstocks commercially by scale by 2025-2030. Ethanol was among the blendstocks having the highest merit function values, according to DOE.

“As this new DOE research shows, ethanol is a phenomenal source of octane for high-octane fuel blends. Ethanol’s unique attributes—including high octane sensitivity and heat of vaporization—make it a highly attractive component for the high-octane fuel blends of the future,” said RFA President and CEO Bob Dinneen. “We strongly encourage the Environmental Protection Agency to take note of this research as it completes the Final Determination of the Midterm Review for the 2022-2025 fuel economy and GHG standards. Pairing advanced internal combustion engine technologies with high-octane, low-carbon fuels like E25 or E30 would be the lowest cost means of complying with increasingly stringent GHG and fuel economy requirements through 2025 and beyond.”

Read the original article: Ethanol to Aid Engine Efficiency Improvements, Emission Reduction

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Nissan Considering Hybrid, Fuel-cell and Biofuel Utes and Vans

CarsGuide

February 13, 2018

by Tim Nicholson & Justin Hilliard

Nissan has confirmed it is looking at range-extender hybrid, hydrogen fuel-cell and biofuel powertrain options for its future line-up of light-commercial vehicles, including the Titan large pick-up.

When questioned about possible future LCV powertrains at the Nissan Futures event in Singapore last week, Renault-Nissan-Mitsubishi Alliance global director and Nissan Research Centre general manager Kazuhiro Doi suggested three substitutes for internal combustion engines.

“I think one of the possible solutions is e-Power-type of electrification,” he said. “We can improve the efficiency of the gasoline engine or diesel engine more by supporting the electrified technologies.”

'e-Power' is Nissan's version of a hybrid system that employs an electric motor to drive the wheels while a small-capacity petrol engine and regenerative braking charge its battery pack – similar to the Holden Volt.

This technology is currently available with the Serena people-mover and Note light hatch that are offered overseas, but Nissan has announced it will introduce more 'e-Power models' soon.

“The other is maybe fuel-cell type of technologies,” Mr Doi added. “It is okay to use biofuel or it is okay also to use hydrogen. Because in the case of hydrogen, the issue is the distribution. But if that is fleet use, we can have … a hydrogen station for fleet business use.

“Another issue is the hydrogen tank. In case of the hydrogen tank, we just increase the capacity. And even though we increase the capacity of the hydrogen tank, the weight itself has not changed, it is just carrying the hydrogen. But in the case of the battery, if we double the battery, the weight is going to be doubled. That is the critical difference.”

He also proposed the use of biofuel as a different green option for LCVs, adding that the cost of hydrogen technology is still too high to implement now.

“In the case of biofuel, the availability of energy is much, much easier than hydrogen. Maybe in that sense, it may be more practical. And I believe, technology-wise, both of them  (biofuel and hydrogen fuel-cell) are possible.

“The question is how we can commercialise it. To commercialise it, we still need to have a breakthrough about the cost. Not only the technology but also the distribution.”

Specifically, biofuels are developed from liquids that have been extracted from other materials like plant and animal waste.

Nissan lobbed the e-Bio Fuel-Cell Prototype in 2016, which employed a special fuel-cell that was created with solid oxide electrolytes instead of noble metals, allowing the conversion of gaseous hydrogen into electricity to top up a 24kWh battery that motivated an electric motor.

Currently, there are several Nissan LCVs sold globally, including the mid-size Navara and large Titan pick-ups, the NV200/300/400 and fully electric e-NV200 vans, and the NT400 light truck.

Mr Doi said he did not think heavy-duty trucks should be powered by pure-electric powertrains due to their significant weight.

“Electric vehicles cannot cover everything. Usually a heavy-duty truck puts lots of load and the vehicle itself is heavy. I think it is not a good idea to put tonnes of battery on the heavy truck.

“Is that good idea to put more and more heavy stuff on the vehicle? It’s something strange. Also heavy trucks run long mileage. It is better to have some other alternative solutions.”

Nevertheless, Tesla revealed its electrified Semi truck in November last year, providing a claimed driving range of 483 to 805km on a single charge thanks to its four electric motors.

Nissan Motor Asia Pacific regional vice-president of marketing and sales for Asia and Oceania, Vincent Wijnen, confirmed that the company was considering an expansion of its electrified LCV models.

“We are selling a lot of LCVs globally, but it’s very different per region,” he said. “In this region, including Australia, I don’t think it has been necessarily the focus, with the exception of utes or pick-ups. But if you discount that and look at vans or small trucks, compared to other regions we have not really been focusing on it.”

Mr Wijnen added that looking at other offerings and technologies from Nissan’s alliance partners was another possibility.

“That doesn’t mean we shouldn’t. Because we have the products in our line-up,” he said.

“We are part of an alliance now, so accessibility to assets or complete products or sharing components is much easier when you are that size.

“So I think it is one of the things we need to, we are looking at going forward to make sure. Because it is an opportunity that we are not today necessarily exploiting fully.”

Nissan Australia managing director and CEO Stephen Lester said he was willing to assess electrified LCVs locally – like the aforementioned e-NV200 – but committing to these products would have to be justified economically.

“As I have told the product team numerous times, there is not a product that we should not be considering at least looking at,” he said. “It all comes back to commercial viability, the ability to meet the regulations of the local government for homologation and to bring a product in that meets the safety and performance expectations, and the fit for purpose expectations of Australian consumers.”

Mr Lester added that he had no update on the Titan large pick-up's Australian business case, but said he thought such a model could be a success.

“There is no secret that I think that there is opportunity in Australia for the car. This is one of the largest ute markets in the world. But there are no major players there from a significant volume perspective, and right now anyway I know there has been speculation, but the reality is I think Titan could be a vehicle that, if we can get it here to Australia, then it will work.”

Read the original article: Nissan Considering Hybrid, Fuel-cell and Biofuel Utes and Vans

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Biofuels Feedstock Study Supports Billion-Ton Estimate

Ethanol Producer Magazine

February 9, 2018

By South Dakota State University

Can farmers produce at least 1 billion tons of biomass per year that can be used as biofuels feedstock?

That’s the question that researchers are trying to answer, according to North Central Regional Sun Grant Center Director Vance Owens. The goal is to replace 30 percent of the petroleum consumed in the United States with biofuels.

Analysis of up to seven years of production data gathered through the Regional Feedstock Partnership, established by the U.S. Department of Energy and the Sun Grant Initiative supports the U.S. Department of Energy billon-ton estimate. That amount could be available annually by 2030.

“Regional field trials were conducted for the most promising bioenergy feedstocks,” explained Owens, who worked on switchgrass production before becoming Sun Grant director. “Based on these numbers and other research we’ve done, we would still see over a billion tons available per year as the bioeconomy continues to develop.”

South Dakota State University was the lead institution for the more than $20 million project which began in 2007. The partnership was funded by the U.S. Department of Energy Bioenergy Technologies Office. The project involved researchers from the U.S. Departments of Energy and Agriculture, 35 land-grant universities, Heidelberg University and several industry partners, as well as Idaho National Laboratory, Oak Ridge National Laboratory, and Argonne National Laboratory.

This project helps fill an important information gap in the quest to produce biofuels from nonfood crops. South Dakota farmers could play a role in producing these bioenergy crops and the biorefineries that convert the biomass into biofuel would be built near where those crops are raised.

Results published, data available online

Field trial results and yield projections for herbaceous crops, including switchgrass, energycane, mixed perennial grasses on Conservation Reserve Program land, giant miscanthus and sorghum, as well as the woody feedstocks poplar and shrub willow, are available online in the January issue of GCB Bioenergy. An article on environmental mapping of biomass resources in the continental United States will also be published in that issue.

This partnership came about as a direct result of the efforts of SDSU Vice President Emeritus for Research and Economic Development Kevin Kephart and others in Sun Grant, Owens explained. More than 130 peer-reviewed papers, including field trial results and yield projects related to corn stover, have been published through this project.

The raw data from the field trials will be available for public use and can be accessed at Knowledge Discovery Framework at the U.S. Department of Energy website. “The ramifications of this research will be much greater due to free data access,” he said.

Study duration, collaboration increase value of data, modeling

The duration of this study is unique, Owens pointed out. “Typically these projects last two to three years, but having trials in place for up to seven years is really important in terms of long-term yield potential.” For example, researchers were able to gather data about how potential biofuels crops reacted to the 2012 national drought and how they recovered in subsequent years in some instances. “Though annual crops suffer, perennials can manage through a one-year drought,” Owens explained. “Being able to see this was a tremendous advantage—and something we wouldn’t likely see with only a two-year study.”

Among the herbaceous energy crops, field-scale trials using traditional agricultural equipment were conducted for switchgrass and mixed perennial grasses suitable for use on CRP land, while smaller individual plots were utilized for energycane and giant miscanthus due to a lack of vegetative planting materials for these species.

Crop potential varies by region,” Owens explained. “There’s not one that makes sense everywhere; it’s more of a localized environment.” The nationwide yield potential maps track which crops are best suited to a particular area.

“For example, switchgrass is more productive than miscanthus in some of the northern regions because miscanthus is not as winter hardy. On the other hand, energycane is well adapted and highly productive in the Deep South” he said. In the future, the researchers would like to do side-by-side comparisons of different species across multiple environments to better understand their yield potential.

The model used to estimate yield potential, known as PRISM-ELM, included yield-limiting factors, such as water availability, low-winter and high-summer temperature response, soil pH, salinity, and drainage. Modelers and agronomists from each species group met periodically to exchange information and review yield potential maps.

“This is unique to have input from all the parties involved, which then helps makes the models more reliable,” Owens said. The model for perennial grasses, for instance, had to be adjusted based on the plants’ ability to develop roots deep in the soil profile.

Read the original article: Biofuels Feedstock Study Supports Billion-Ton Estimate

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EIA Maintains 2018, 2019 Ethanol Production Forecasts

Ethanol Producer Magazine

February 8, 2018

By Erin Voegele

The U.S. Energy Information Administration has published the February edition of its Short-Term Energy Outlook, maintaining its January forecast that ethanol production will average 1.03 million barrels per day in both 2018 and 2019. This level is consistent with the 1.03 million barrel per day production average realized in 2017.

On a quarterly basis, the EIA currently predicts that ethanol production will average 1.02 million barrels per day during the first quarter of this year, increasing to 1.04 million barrels per day during the second, third and fourth quarters. In 2019, production is expected to fall to 1.02 million barrels per day during the first quarter, increasing to 1.04 million barrels per day for the final three quarters of the year.

The volume of ethanol blended into motor gasoline is expected to reach 960,000 barrels per day this year, up from 950,000 barrels per day in 2017. In 2019, the volume of ethanol blended is expected to increase, reaching 970,000 barrels per day.

The EIA’s most recently weekly ethanol production data shows the U.S. produced 1.057 million barrels per day of ethanol the week ending Feb. 2, up from 1.04 million barrels per day the previous week.

The EIA’s most recent monthly import data shows the U.S. imported 496,000 barrels of ethanol in in November, all from Brazil. During the same month, the U.S. exported 2.648 million barrels of ethanol, primarily to Brazil, Canada, and India.

Read the original article: EIA Maintains 2018, 2019 Ethanol Production Forecasts

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New RFA Report Confirms Record Ethanol Exports of 1.37 Billion Gallons in 2017

Renewable Fuels Association

February 7, 2018

By Emily Druckman

Government data released today confirms that U.S. ethanol exports set a new record in 2017, with an astonishing 1.37 billion gallons shipped to more than 60 countries around the world. The 2017 export total was up 17% from 2016 and beat the previous record set in 2011 by some 174 million gallons (mg). In conjunction with today’s data release, the Renewable Fuels Association (RFA) released a detailed summary of 2017 U.S. ethanol export and import statistics.

Brazil was the leading destination for U.S. ethanol exports, receiving 446 mg, or 33% of total shipments. Canada imported 328 mg from the United States, while India took in 173 mg. The Philippines and South Korea rounded out the top five destinations in 2017. Export volumes to nine of the top 10 destinations saw increases over 2016 volumes, with Brazil, India, the Netherlands, Singapore, and United Arab Emirates showing the largest gains. Meanwhile, after serving as the third-leading ethanol export market in 2016, China finished just out of the top 10 in 2017, as exports to that nation plunged nearly 90% in the wake of new tariffs being implemented.

The value of U.S. ethanol exports was $2.4 billion in 2017, up 16% from 2016’s value and the second-highest on record. Undenatured fuel ethanol accounted for 60% of total exports, while denatured fuel ethanol was 36%. Denatured and undenatured ethanol for non-fuel industrial uses made up the remaining 4% of exports.

U.S. ethanol imports remained scarce in 2017, with just 77 mg entering the country. Nearly all of the imported product entered through California ports and was used to meet the state’s Low Carbon Fuel Standard requirements.

Reflecting on the record year, RFA President and CEO Bob Dinneen stated, “Even when facing massive trade policy headwinds in 2017, the U.S. ethanol industry rose to the challenge by delivering record volumes of low-cost, high-octane fuel to the world market. One out of every 11 gallons of ethanol produced in the United States ended up being exported to more than 60 countries, offering a cleaner fuel at a lower price to consumers around the globe. The U.S. ethanol industry is proud of this accomplishment, and looks forward to continuing to grow the global market for ethanol and other renewable fuels. RFA will continue to work with its partners to break down artificial trade barriers, expand export opportunities for U.S. producers, and educate the world’s consumers on the benefits of low-carbon renewable fuels.”

Read the original release: New RFA Report Confirms Record Ethanol Exports of 1.37 Billion Gallons in 2017

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