ACE: Blend Wall Cost Reporting Wrong

Several recent media reports have reported that the “blend wall” cost refiners nearly $1.35 billion last year. The blend wall is the amount of ethanol that can be blended into the fuel supply. Today is this considered “E10″ and for the most part this has been achieved. The next step to hurdle the so called blend wall is to either increase the amount of ethanol Screen Shot 2014-04-04 at 10.59.49 AMblended into the fuel supply, such as E15 which is a voluntary blend (retailers can choose to blend E15 and consumers can choose to purchase E15) or to promote mid-level or higher blends of ethanol such as E85, which can be used in flex-fuel vehicles.

In response to these reports, Ron Lamberty, senior vice president for the American Coalition for Ethanol (ACE) called them “incomplete and misleading”. A recent Reuters article said that was the amount nine companies paid for Renewable Identification Number (RINs), which are credits refiners provide to EPA to prove they bought the amount of renewable fuels required by law. RINs are free to refiners who blend biofuels, while refiners who choose not to blend biofuels can buy RINs from companies that blend more than the law requires.

“Those refiners made a business decision to purchase credits instead of ethanol. Reports aren’t honest if they fail to point out that those nine refiners paid $1.35 billion dollars to other refiners for those companies’ excess RINs.” said Lamberty. “The “blend wall” provided $1.35 billion dollars of income to some refiners, which reduced their cost of fuel.”

Lamberty said ACE would like to see more RINs generated by retailers, since they generally use the additional funds to reduce prices at the pumps. “Unfortunately, at the same time oil companies are complaining about RINs and the “blend wall,” they enforce policies that won’t allow their branded marketers to sell E15 and higher ethanol blends,” Lamberty said. “Station owners who offer E15, E85, and other blends generally sell about 20% ethanol overall, making more RINs available. And when they sell RINs, they pass most of the value of those RINs on to customers in the form of lower pump prices.”

Corn Growers at Biofuels Beltway March

ace14-dc-corn-teamMore than 80 people turned out for the American Coalition for Ethanol Biofuels Beltway March this year, the most ever, and the diverse group included ethanol producers, retailers, bankers, truckers, cattle ranchers, students – and a whole bunch of corn farmers. The team here consisted of (LtoR) Missouri farmer Gary Porter, Missouri Corn Growers public policy director Shane Kinne, and Minnesota farmers on the board of Chippewa Valley Ethanol Dale Tolifson and Dave Thompson.

Cindy caught up with them as they were heading out of the Capitol after making their rounds and asked them each to give a brief impression of their visits.

Shane said the highlight of the trip was getting folks into meet with their lawmakers, telling the personal stories of farmers and fuel retailers and how ethanol is making a difference.

“They have a great story to tell, and it makes a huge difference when [lawmakers] hear it firsthand.” Shane said.

Gary said he appreciated the different points of view that he heard, such as viewpoints from folks not from the Midwest who aren’t involved in ag or ethanol.

“It’s interesting for me to talk to them and listen to what they say, and also for me to share with them the way I see it,” adding that since he’s a corn grower, cattle feeder and fuel retailer, he has a pretty well-rounded view and is willing to talk to even those he doesn’t agree with.

“That’s the ones we need to talk to,” Dave pointed out. “Even though they didn’t agree with us, they were very receptive to listening, they had good questions, and I think we have a great story to tell.”

Dale echoed those sentiments and was glad to tell his personal story.

“We tell about our experiences on the farm, how we helped grow the ethanol industry, and how that industry is not only important for clean air, but it’s important for jobs and the ag community,” as well as advancements in agriculture that wouldn’t have happened if it wasn’t for ethanol, including boosting yields to meet all demands.

Listen to what they said here: Interview with Biofuels March team


2014 ACE Biofuels Beltway March photo album

Retailers Tell Ethanol Story at ACE Fly-in

Fuel retailers in ethanol producing states had compelling stories to tell at the American Coalition for Ethanol Biofuels Beltway March last week in Washington DC. Several of them sat down with reporters during the event to talk about their success selling higher ethanol blends, as well as the hurdles they had to overcome to do so.

ace14-dc-badenhopGlenn Bedanhop is a third generation farmer who is also president and CEO of American Freedom Energy in the small town of Liberty Center, about 30 miles west of Toledo, Ohio. “It’s rewarding knowing the value you’re putting back in your local community,” said Badenhop, who became the first retailer in Ohio to offer E15 in January because he believes in consumer choice. “It’s their choice,” he said. “We’re not mandating that they buy Coke, Pepsi, Dr. Pepper – it’s just like the fuels.” Interview with Glenn Badenhop, Ohio fuel retailer

ace14-dc-goodCharlie Good has been in the fuel retailing business for 34 years as a convenience store operator and auto mechanic and he started offering higher ethanol blends at his Good and Quick store in Nevada, Iowa last August despite his supplier’s objections. “I had to de-brand because the oil company didn’t want that under their canopy,” said Good. “My sales are up 20-25% a month and of the gallons that they’re up, virtually all of it is the ethanol fuels.” Interview with Charlie Good, Iowa fuel retailer

ace14-dc-vollanBruce Vollan started using blender pumps at his rural Baltic, South Dakota convenience store six years ago. “My experience has been pretty incredible,” he said. “You see a lot of people actively seeking out blends.” Vollan has seen his small business has grown to 13 full and part time employees and he says the negative publicity about ethanol doesn’t bother him because he believes he’s on the right team. He was happy to take time away from his business to take his story to Washington DC and let lawmakers and bureaucrats know what is really happening. “That’s what the ethanol industry is all about,” he said. “It’s about telling the truth.” Interview with Bruce Vollan, South Dakota fuel retailer


2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

Sen. Thune Meets with Ethanol Supporters

ace14-dc-thune-groupA team of four biofuels supporters had the chance to meet with Sen. John Thune (R-SD) last week while in Washington DC for the American Coalition for Ethanol (ACE) Biofuels Beltway March.

In an interview following that meeting, Thune talked about some of the issues facing the biofuels industry, in particular the EPA proposal to lower volume requirements under the Renewable Fuel Standard. “Trying to reverse the EPA’s decision on this is what we’ve been focused on since it came out,” said Sen. Thune.”Going down to 13.1 gallons is horrible for the industry so we hope they make some accommodation for getting beyond the blend wall.”

Thune says he expects to Congress to get a package of expired tax credit extensions passed soon, including renewable energy credits for wind, advanced biofuels, and biodiesel. “It’s very hard for people to plan to invest when they don’t know what the rules are going to be,” he said.

The senator also talked about the rail delays that have been impacting shipments of ethanol and grain. “The railroads are going to have to do a better job,” he said, noting that the problem has been caused by both the long, cold winter and increased shipping of crude oil from North Dakota. “It’s important that the railroads recognize that agricultural commodities need to be shipped too.” Interview with Senator John Thune (R-SD)

2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

DF Cast: Lawmakers Listening to Ethanol Advocates

Ethanol backers got their voices heard during the recent American Coalition for Ethanol (ACE) Biofuels Beltway March in Washington, D.C. And at least some lawmakers were listening.

In this edition of the Domestic Fuel Cast, we talk to Rep. Rodney Davis (R-IL), Sen. Mike Johanns (R-NE), and Sen. John Thune (R-SD), who met with ACE and its supporters and all expressed their backing of efforts to keep renewable fuels, especially ethanol, in the forefront of federal policies.

Listen to what they had to say after they listened to ACE: Domestic Fuel Cast - Lawmakers Meet with Ethanol Advocates

You can also subscribe to the DomesticFuel Cast here.

2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

The Littlest Lobbyist for Ethanol

ace14-dc-ethan1Wearing a tie and sporting a “Don’t Mess with the RFS” button, 10-year-old Ethan Fagen was the youngest of the American Coalition for Ethanol (ACE) Biofuels Beltway marchers this week on Capitol Hill.

Ethan came along with his grandfather, Ron Fagen of Fagen, Inc., and was right in the trenches handing out materials and talking about the benefits of ethanol, like how good it is for the environment compared to fossil fuels. “Think in 200 years if you run ethanol there will be cleaner air for the next generation,” said Ethan, who is part of that next generation.

ace14-dc-fagensSitting in the front as the ACE Fly-in participants heard from government officials, Ethan caught the attention of Secretary of Agriculture Tom Vilsack, who thought it was “pretty cool” he was there for the event.

In my interview with Ethan, he told me that he would like to be a farmer someday and grow corn and have cattle. It’s interesting that if you add two letters to Ethan’s name, it becomes ethanol. Interview with Ethan Fagen, ACE Fly-in Participant


2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

ACE Takes Ethanol Message to Friends and Foes

ace14-dc-alversonThere were over 25 battalions of ethanol troops on Capitol Hill this week to fight for the honor of biofuels, bringing the message to both friends and foes in Congress.

American Coalition for Ethanol president Ron Alverson, a South Dakota farmer and board member for Dakota Ethanol, says the teams had appointments with the offices of more than 130 senators and representatives, and he thought they were well received, even in enemy territory. “We went into what we thought were going to be some pretty hard places – representatives from Alabama, Pennsylvania, Rhode Island,” he said. “They were very cordial and they listened well … we were really pleased.”

ace14-dc-johannsWhen meeting with friends like Senator Mike Johanns (R-NE), the ethanol supporters delivered messages of gratitude and asked advice for approaching less friendly lawmakers. They also provided “ammunition” for allies in the form of the packets of the latest information to defend against some of the more popular arguments against ethanol, such as food versus fuel and engine issues with higher blends. “We’ve got some really good arguments and good data…all we can do is go out and tell our story,” said Alverson.

Listen to an interview with Alverson here: Interview with Ron Alverson, South Dakota farmer and American Coalition for Ethanol president


2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

Ag Secretary Takes Time on Ag Day for Ethanol

ace14-dc-vilsackThere are lots of activities for National Agriculture Day going on today in Washington DC, including a big celebration unveiling a statue of Dr. Norman Borlaug in the Capitol, but Agriculture Secretary Tom Vilsack still took time to meet with members of the American Coalition for Ethanol in town this week to visit Congressional offices

“The country needs a robust renewable fuel industry,” said Vilsack. “It provides choice for consumers and less cost gas at the pump. It helps to create hundreds of thousands of jobs which is important for the economy. It stabilizes farm income, it’s better for the environment, and it makes us a safer nation because we’re less reliant on others for our energy and fuel sources. So we need to continue to have a robust commitment to this industry, we need to expand it and grow it.” Brief interview with Secretary Vilsack after ACE visit

The secretary spoke to the more than 80 ethanol industry about what USDA is doing to achieve that goal, including finding creative ways to increase higher ethanol blend pumps, promoting exports of ethanol to Japan, India and China, and continuing to work towards encouraging use of higher blends in this country.

2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

Big Turnout for ACE Biofuels Beltway March

ace14-dc-brianAn enthusiastic crowd of more than 80 ethanol supporters from 15 states are chomping at the bit to be set loose on Capitol Hill to visit the offices of Congress members and educate them about the importance of biofuels during the American Coalition for Ethanol (ACE) Biofuels Beltway March.

“We’ve got people from all walks of life here,” said ACE Executive Vice President Brian Jennings. That includes not just ethanol producers and corn farmers, but bankers, truckers, cattle ranchers and students. “It shows the diversity of this industry, the breadth and depth of support we have out there in the grassroots for ethanol.”

ace14-dc-crowdJennings says 40 percent of the group gathered for this sixth annual DC event have never visited the office of a Congressional representative before. “We try to give them some advice,” he said. “Most importantly, tell your story.”

The ACE group is hearing this morning from the Assistant Administrator of the Environmental Protection Agency, the Secretary of Agriculture, and the Special Assistant to the president for Energy and Climate Change before heading to the Hill to meet with congressional representatives.

Listen to my interview with Brian here: Interview with Brian Jennings, ACE

2014 ACE Biofuels Beltway March photo album

Coverage is sponsored in part by Patriot Renewable Fuels

Biofuels Supporters Heading to Beltway

ACE Biofuels Beltway LogoEthanol advocates from around the country are marching on Capitol Hill this week with the message that the Renewable Fuel Standard (RFS) is working.

It’s the 6th annual Biofuels Beltway March organized by the American Coalition for Ethanol (ACE). “We have more than 80 people registered to attend, which is our highest attendance yet,” said Director of Strategic Projects Shannon Gustafson. “Those attending the event are fuel retailers, farmers, ethanol producers, bankers, and business owners representing 15 different states.”

The event officially kicks off on Tuesday when attendees will hear from representatives of the Environmental Protection Agency, USDA, and the White House. After that, the marchers will be split into groups to attend meetings on Capitol Hill Tuesday afternoon and Wednesday. “So far we have meetings scheduled with more than 130 offices on Capitol Hill,” said Gustafson, who anticipates they will have even more before they begin.

In addition to carrying the message that the RFS is working, supporters will also be telling lawmakers how ethanol benefits consumers, decreases our dependence on foreign oil, and plays a critical role in the future of our nation’s energy independence.

Domestic Fuel will be there to bring it home to those of you who are unable to attend. Thanks to ACE and Patriot Renewable Fuels for making that possible.

Editorial from Father of Ethanol

merle-andersonThe man who is known as the “Father of Ethanol” in the United States is still busy advocating for the industry at the well-seasoned age of 93.

Merle Anderson, one of the founding members of the American Coalition for Ethanol (ACE), just recently penned an excellent editorial for the Grand Forks Herald about his favorite subject and his observations are just as sharp as ever when it comes to the fuel he has been promoting for decades. Here’s some excerpts his letter entitled “Government ‘myths’ limit ethanol’s full use” that he wrote with input from his friend and fellow ethanol advocate Orrie Swayze from Watertown, S.D.:

First, we must remember that Henry Ford favored E30 for his Model T. After that, what could go wrong, did go wrong as government teamed with oil, and — in a joint effort to keep ethanol out of gasoline markets — created misleading myths that E30 was illegal and would ruin engines…

Merle debunks several of those myths, including that higher ethanol blends void car warranties and that gas station pumps are unable to handle higher blends such as E30. “I really chuckle at that one, because standard gas station pumps were the only pumps available when E85 was introduced nearly 20 years ago, and they still are safely pumping E85.”

Merle concludes – My dream is every American and all of agriculture — including our sugar beet industry — would have access to an ethanol market that is not limited by EPA and big oil’s nonsense or the ethanol blend wall that has been in place since the first Model T was built.

Read Merle Anderson’s entire editorial here
.

South Dakota to Include 15% Ethanol in State Fleets

South Dakota will soon begin incorporating 15 percent ethanol (E15) fuel into its state vehicle fleet.

sd-govGovernor Dennis Daugaard announced Thursday that E15 will be made available this year during a test period at four major fuel sites in Brookings, Pierre, Rapid City and Sioux Falls. The state will utilize E15 for flex fuel vehicles and some of its newer non-flex fuel models that are approved for E15 use. Flex fuel vehicles make up over 58 percent of the fleet or 1,950 vehicles. Currently, the state fueling sites primarily provide E10 fuel for fleet vehicles.

“South Dakota is a large ethanol producer, and our state has significantly benefited from the ethanol industry,” said Daugaard. “The goal is to use more of our homegrown fuel by using E15, the newest fuel in the marketplace.”

South Dakota is the fifth largest ethanol producing state in the nation, producing about a billion gallons per year, an industry worth about $3.8 billion. It is also home to POET, one of the world’s largest ethanol production companies, based in Sioux Falls. “We are excited to hear Governor Daugaard’s desire to incorporate E15 into South Dakota’s state vehicle fleet,” POET President and CEO Jeff Lautt. “This is a no-cost means to create new jobs, stimulate the economy, secure our nation and improve our environment.”

Also located in South Dakota is the American Coalition for Ethanol (ACE). “Gov. Daugaard is providing tremendous leadership and vision by encouraging the use of E15 in the state’s vehicle fleet, a move which will support South Dakota’s farmers and ethanol industry,” said Ron Lamberty, ACE senior vice president.

The governor’s office says the testing period for E15 will run about six months, after which the state will evaluate how the use of the E15 blend affected the fleet and determine how to efficiently utilize ethanol in the future. “We are confident state employees will find E15 a safe, reliable and affordable fuel choice,” said Lamberty.

Arming for a Fact-Based Fight Over Ethanol

bernens1It’s not always fact-based arguments proponents of ethanol are up against when battling Big Oil. But that’s why it’s all more important to make sure you have good facts on your side in the fight. Farmers who attended the recent Commodity Classic in San Antonio were able to sit in on a session titled, “Biofuels and the Renewable Fuels Standard, A Farmer’s Avenue to American Energy Independence,” to make sure they can talk about the success stories and silence ethanol’s critics.

“Because of our success, we’ve had Big Oil really come after us and say, ‘We’re not going to lose anymore market share,’” says Jack Bernens, session moderator and marketer of Syngenta’s Enogen corn, specifically designed for ethanol production. “When monopolies get threatened, they like to push back hard.”

Hear more of what Jack had to say here: Jack Bernens, Syngenta

jennings1Jack was joined on the panel by Brian Jennings with the American Coalition for Ethanol, who echoed Jack’s view that you’re not necessarily battling facts when it comes to taking on some of the myths put out by the petroleum industry.

“The message I was trying to relay to the corn growers is stay involved, remain engaged, get your neighbors and friends involved, and know that this isn’t a fact-based fight. When the fight is about facts, we always win,” Brian says, adding that ethanol doesn’t have to stoop to the lies and scare tactics of Big Oil.

Listen to Brian’s interview here: Brian Jennings, American Coalition for Ethanol

doxtad1Another effective tool in the fight is showing the positive change ethanol has brought to Rural America, creating better markets for farmers’ corn, helping the country achieve energy independence, and building up communities, like the one that Northwest Iowa corn farmer James Doxtad comes from. He says while many folks back in his home state are aware of the good the renewable fuel has brought to the heartland, too many people in the country just don’t know. “It’s amazing how many people out there are unaware of the advantages of ethanol. Ethanol is a good thing, and we’re producing a good product, and we’re doing it for a good reason.” he says.

Check out James’ interview here: James Doxtad, Holstein, Iowa

Meanwhile, all three might get some help spreading the word as Syngenta released a new documentary video titled, “Ethanol: Fueling Rural America’s Future – One Community at a Time,” that provides a platform for farmers, ethanol producers and industry advocates to share their passion for an industry critical to the future of agriculture and rural America.

ACE Preparing for Biofuels Beltway March

Make Washington keep their word was a common mantra during the National Ethanol Conference last week. American Coalition for Ethanol (ACE) Executive Vice President Brian Jennings is going to help them do just that. Each March, ACE brings nearly 100 ethanol advocates to the Hill to meet with Legislative and key stakeholders to tell their stories about the benefits of ethanol. This year’s Biofuels Beltway March is just around the corner on March 26-27, 2014 in Washington, D.C.

nec14-jenningsThis year, Jennings said they are doing something a bit different. They are asking retailers from different states who have successfully added the infrastructure or the equipment they need to sell E15, E85 or both, to join them. “So they will deliver the message straight from their own experiences that higher blends work. The RFS [Renewable Fuel Standard] works. We want to see you continue to fulfill what the program was intended to do,” said Jennings.

During the NEC conference, a spokesperson from Marathon said E85 won’t work and E15 is a nonstarter. When asked to respond to those comments, Jennings answered, “We added over 200 E85 sites in 2013 and it was based on price. So he is simply not correct when it come to E85. Retailers are looking at it and understanding better today than they ever have how to price E85 relative to straight gas or relative to E10 so the consumer keeps coming back and makes the choice that it works well in my FFV [flex fuel vehicle].”

In terms of E15, Jennings said he was referring to liability. But there are things ACE is working on along with others to erase liability concerns whether those are real or perceive. The other half of the battle and helping them understand the blending economics.

“I was disappointed to hear what the gentleman from Marathon say what he did about higher blends, but what’s going on on the ground, in the states defies the message he was trying to deliver about E85 and E15,” added Jennings.

Listen to Cindy’s interview with Brian Jennings: Interview with Brian Jennings, ACE

2014 National Ethanol Conference Photo Album

NEC Coverage sponsored by Patriot Renewable Fuels LLC

ACE Elects 2014 Board Officers

The American Coalition for Ethanol (ACE) has elected its 2014 board officers this week with a continued emphasis on providing opportunities for independent ethanol producers, farmers, and grassroots advocates to innovate and succeed.

Ron Alverson, founding chairman and current board member of Dakota Ethanol, a 48 million-gallon-per-year (MGY) ethanol producer in Wentworth, SD, was re-elected as President of the ACE Board of Directors. “I am eager to work with such a diverse group. The ACElogoexperiences and perspectives of the ACE board are well suited to represent our members as we continue to highlight the potential of a strong Renewable Fuel Standard (RFS) and higher blends like E15 and E85, and what kind of benefits they offer for the consumer and the rural economy,” said Alverson.

Duane Kristensen, General Manager of Chief Ethanol Fuels, a 62 MGY ethanol producer in Hastings, NE, was elected Vice President of the ACE board. He noted, “ACE and Chief Ethanol Fuels are a great combination in that we share many of the same ideals and background, I look forward to this opportunity to help highlight ethanol’s rural success story and I’m enthusiastic about the potential to focus on long-term efforts that will help support the industry, agriculture, and American independence.”

Dave Sovereign, who represents Golden Grain Energy, a 100 MGY ethanol producer in Mason City, IA, on the ACE board, and also serves on the board of Absolute Energy, a 115 MGY ethanol producer in Lyle, MN, was elected Secretary of the ACE Board of Directors. Sovereign also owns Cresco Fast Stop, a convenience store that specializes in selling E15, E30 and E85. “I am excited about this opportunity. I know firsthand how the ethanol industry has brought quality jobs for quality people while revitalizing rural communities across the country. And I’m looking forward to helping promote the industry and its growth so future generations of rural Americans can prosper.“

ACE officers and two additional board members comprise the ACE Executive Committee. The 2014 ACE Executive Committee is as follows:

  • Ron Alverson, Dakota Ethanol, President
  • Duane Kristensen, Chief Ethanol Fuels, Vice President
  • Dave Sovereign, Golden Grain Energy, Secretary
  • Owen Jones, Full Circle Ag Cooperative, Treasurer
  • Lars Herseth, Herseth Ranch, Member
  • Scott Parsley, East River Electric Cooperative, Member