Domestic Fuel

The E15 waiver was a hot topic during Commodity Classic and for good reason: EPA administrator Lisa Jackson, in response to a question asked during a Congressional hearing, said she felt they’d be ready to make a decision late summer. Originally, the EPA was to have ruled on the E15 waiver, that would waive the Clean Air Act to allow up to 15 percent ethanol in motor vehicles, by the beginning of last December. At that time, they deferred to mid-summer – now they are saying possibly by end of summer.

“Though without giving a date, clearly that date has passed and that’s troubling I think, and we’ve got to keep the pressure on,” said Brian Jennings, the Executive Director of the American Coalition for Ethanol (ACE) during an interview with DomesticFuel during Commodity Classic.

According to Jennings, Robert White with the Renewable Fuels Association (RFA), and Secretary of Agriculture Tom Vilsack, the EPA is doing more work on small engines and the effect of ethanol blends on catalytic converters. This despite the large number of research already available.

“But it does seem frustrating to us that they keep looking for some sort of excuse to delay or not to make the decision when we feel the preponderance of evidence, so far, and as it continues to come in, is going to justify this,” continued Jennings.

Both Vilsack and White agree and feel that the E15 waiver will pass – especially since the Renewable Fuels Standard mandates 36 billion gallons of ethanol by 2022 and the E10 blend wall is approximately 14 billion gallons and White notes that there are 22 billions gallons above the blend wall that need to find a home.

“E15 is great, but it’s still a band aid for the real issue and the sticking point is going to come very soon and the problem we’ve been facing for well over a decade is you simply can’t flip a light switch for this infrastructure to be there,” explained White.

You can download (mp3 file) or listen to a Robert’s interview here:

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You can download (mp3 file) or listen to Brian’s interview here:

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It’s a busy day for the federal government. Here is what has happened today. The EPA has released its expanded rules for the Renewable Fuel Standard, The U.S. Department of Agriculture has proposed a rule on the Biomass Crop Assistance Program (BCAP) that would provide financing to increase the conversion of biomass to bioenergy, and the President’s Biofuels Interagency Working Group released its first report – Growing America’s Fuel. The report was co-authored by co-chairs Secretaries Vilsack and Chu along with EPA Administrator Lisa Jackson and lays out the strategy to advance and bring to market sustainable biofuels.

“Advancing biomass and biofuel production holds the potential to create green jobs, which is one of the many ways the Obama Administration is working to rebuild and revitalize rural America,” said Agriculture Secretary Tom Vilsack. “Facilities that produce renewable fuel from biomass have to be designed, built and operated. Additionally, BCAP will stimulate biomass production and that will benefit producers and provide the materials necessary to generate clean energy and reduce carbon pollution.”

Several industry organizations responded to the report today including the American Coalition for Ethanol (ACE) and Growth Energy.

“We welcome this new vision focused on biofuels production targets, and we encourage equal if not greater attention on distribution and creating long-term, sustainable demand for today’s corn ethanol and the next generation of biofuels,” said Brian Jennings, Executive Vice President of ACE.  “Approving the pending E15 waiver request, requiring the production of more Flexible Fuel Vehicles (FFVs), and providing incentives for the installation of blender pumps to dispense mid level ethanol blends all need to occur if we are to ensure that both corn ethanol and the next generation of biofuels can make good on their promise to reduce our dependence on foreign oil.”

Growth Energy CEO, Tom Buis agreed with Jenning’s statement and added, “Growth Energy commends President Obama for recognizing the value of grain ethanol and the need to move forward with cellulosic ethanol to help our nation meet the goal of producing 36 billion gallons of renewable fuels by 2022. The President understands the need for enhanced support for the existing ethanol industry and greater investment to create jobs, improve our environment and increase our national security.”

The Environmental Protection Agency (EPA)  made an upwards revision today when releasing the expanded Renewable Fuels Standard. They gave corn-based ethanol a 21 percent advantage over conventional gasoline, more than what was originally slated. This new revision also qualifies all corn ethanol, including existing and new production, for the conventional biofuels targets in the RFS.

“While we’re pleased that the U.S. EPA recognizes corn ethanol’s distinct advantage over gasoline when it comes to greenhouse gas emissions and gratified that EPA modified ethanol’s carbon footprint calculation to more accurately reflect real-world data, we don’t believe the agency’s overall assessment of ethanol’s greenhouse gas reduction potential was good enough or accurate,” said Brian Jennings, Executive Vice President of ACE.  “By continuing to apply scientifically indefensible ‘international indirect land use’ penalties to corn ethanol, these regulations seriously underestimate ethanol’s greenhouse gas benefits over oil while completely ignoring the indirect emissions associated with petroleum – for example, the military protection of world oil supplies and oil transportation routes.”

One of the complaints of indirect land use change  (ILUC) theory is that it is not based on sound science or real data but simply derived using computer modeling. When ILUC theory is eliminated from the equation, corn-based ethanol’s GHG reductions are significantly higher – 61 percent according to ACE who comnissed the study, “Lifecycle Analysis of Greenhouse Gas Emissions Associated with Starch-Based Ethanol.”

Among the key findings of the report: “the scientific literature available to date shows a huge variation in estimates of carbon release from land clearing in general, on the order of 50 percent plus or minus – a huge margin of error that should not be relied upon to make policy.”

Jennings concluded, “America’s ethanol producers are committed to providing a clean, renewable fuel that supports the nation’s economy through job creation and reduces our dependence on foreign oil. The revisions in this proposed rule are a positive step by EPA, but corn-based ethanol must not be unfairly singled-out for penalty based on the indirect land use change theory.”

Motorists in Sioux Falls, SD now have more fuel choices at the pump with the installation of four new ethanol blender pumps at a Kings Mart gas station in the city.

Through a joint effort between the American Coalition for Ethanol (ACE) and the South Dakota Corn Utilization Council (SDCUC), the station now offers a variety of fuel blends including unleaded gasoline and E10, and E30 and E85 for Flexible Fuel Vehicles (FFVs).

“This is the first location in Sioux Falls to offer a blend of 30 percent ethanol for FFV owners,” said Ron Lamberty with ACE. “The important investments made by the owners of King’s Mart, and the South Dakota Corn Utilization Council with the assistance of ACE and the “Blend Your Own Ethanol” campaign, have provided consumers with another ethanol fueling option in Sioux Falls.”

The BYO Ethanol campaign was launched last year as a partnership between ACE, the Renewable Fuels Association, the National Corn Growers Association and leading corn-producing states such as South Dakota. The campaign works to show gas station owners the benefits of blending ethanol and using blender pumps to provide choices for motorists.

The Sioux Falls blender pump location joins 40 other locations across South Dakota and around 150 nationwide. ACE offers an on-line map of blender pump sites.

The American Coalition for Ethanol (ACE) has scheduled the organization’s second annual DC fly-in. The “Biofuels Beltway March” will take place March 22-23 on Capitol Hill.

“There has never been a more urgent time to bring grassroots voices to Capitol Hill in support of ethanol,” said Brian Jennings, Executive Vice President of ACE. “We want our ACE members to speak directly to these key decision-makers and show the grassroots strength of the ethanol industry.”

Last March, thirty ACE members traveled to Washington, DC and met with more than 70 Members of Congress and the administrator of the U.S. Environmental Protection Agency, to personally deliver messages of support for ethanol and answer questions about the real-world impacts of ethanol and ethanol policies.

This year, ethanol supporters will discuss several important issues with members of Congress, including: the Volumetric Ethanol Excise Tax Credit (VEETC, the ethanol tax credit) which expires in 2010 and needs to be extended, EPA’s decision on whether to approve E15 for all vehicles, the “Choice Act” which will provide more Flexible Fuel Vehicles and blender pumps, and the continued misinformation campaigns by ethanol’s opponents.

Find out more about the event here on the ACE website.

The ethanol industry continues to let the EPA know its thoughts on the postponement of the decision regarding the E15 Waiver request, but like many other organization, is confident that the EPA will approve up to E15 blends by mid-2010.

Brian Jennings, the Executive Vice President of the American Coalition for Ethanol (ACE) and one of the ethanol groups to submit the original waiver request, commented today, “While we would have strongly preferred that EPA approved E15 today for all vehicles, we’re pleased that progress is being made toward this goal. We are confident that in the long run the data will demonstrate that E15 and higher ethanol blends such as E20 and E30 can effectively be used in all vehicles.”

While the EPA acknowledges that ethanol will need to be blended into gasoline at levels great than 10 percent (E10) to meet the goals of the Renewable Fuel Standard which states that the country needs to blend 36 billion gallons of alternative fuels by 2022, there is consternation among supporters of their unwillingness to acknowledge current vehicle research that supports the use of mid-level blends of ethanol. ACE has conducted research regarding the performance of mid-level ethanol blends in conventional vehicles for the past several years.

The organization believes that in preparation for the E15 waiver to be approved now is a good time for Congress to enact the Harkin-Lugar ‘Choice Act,’ S. 1627, “which promotes flexible fuel vehicles, blender pumps and ways for fuel retailers to economically add more options for their customers.”

Jennings concluded, “Ultimately we need to shift the power to decide what fuels motorists use away from government agencies and oil companies and to consumers.  We support maximum consumer choice for motorists to use E10, E15, E20, E30, E85, or ethanol-free gasoline, and we believe that when consumers are finally given these meaningful choices they will select the ethanol-blended fuels that work best in their vehicles. Senate Bill 1627 will be one of ACE’s top legislative priorities for 2010.”

Click here to read ACE’s full statement.

The American Coalition for Ethanol (ACE) has elected new officers for the upcoming year.

The new president for the ethanol advocacy organization is Lars Herseth, a family farmer from South Dakota and father of Rep. Stephanie Herseth Sandlin (D-SD). He is also a politician himself, having served in the South Dakota state legislature for nearly 20 years. In addition to being a farmer, Herseth is an investor in locally-owned ethanol plants in South Dakota and Minnesota.

Herseth takes the reins from Brian Wilcox of Nebraska Public Power District who became Acting President earlier this year when the position was vacated by Bob Scott, whose company, POET Ethanol Products, resigned from the Board. Wilcox was re-elected to serve as Vice President while Owen Jones of 4 Seasons Co-op was re-elected as Treasurer. Jones is a farmer / rancher from Britton, South Dakota. Duane Kristensen of Chief Ethanol in Hastings, NE was newly elected as the organization’s Secretary.

Representatives from the Renewable Fuels Association (RFA) and the American Coalition for Ethanol (ACE) teamed up at the National Association of Convenience Stores (NACS) Show in Las Vegas last week to promote the BYO Ethanol blender pump program.

Robert White (left) with RFA says blender pumps that can offer a variety of ethanol blends, from E10 to E85 and several steps in between, which gives consumers more choices and retailers more potential income opportunities. “With a blender pump for ethanol, you have a dispenser that everyone can use,” White said at the show. “Whether they’re fueling their lawnmower, their motorcycle, their legacy vehicle, their flex-fuel vehicle, there’s something for everyone.”

However, retailers have expressed concerns about liability issues in the event that consumers put the wrong type of fuel in a certain engine and it causes damage. “We promote standardizing labeling practices for the retailers because we want them to be protected. If they’re selling our product we don’t want any liability issues for them,” White said. The blender pumps are clearly labeled that blends above 10 percent are only for flex-fuel vehicles.

Domestic Fuel reporter Joanna Schroeder interviewed Robert about some of the ethanol blend issues they were discussing with retailers at the 2009 NACS show. Listen to or download that interview here.

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All of the major ethanol organizations in the country have made statements refuting an article in Science journal this week regarding indirect land use change effects of biofuels.

“Fixing a Critical Climate Accounting Error”, authored by recognized ethanol-detractor Timothy Searchinger, argues that biofuels and other bio-based energies should be accountable for the biogenic tailpipe and “smokestack” CO2 emissions that are absorbed by growing feedstocks and carbon emissions that could result from land clearing. The authors claim that existing and proposed regulations, such as the so-called U.S. cap and trade bill, create an accounting loophole that will lead to increased deforestation.

The Renewable Fuels Association says the authors propose an unnecessary and impossible system that would trace actual flows of carbon. “The real issue is not accounting tactics, but whether biofuels reduce GHG emissions compared to continued petroleum use. There is clear and substantial evidence that they do.” RFA noted in a statement.

Growth Energy CEO Tom Buis says that doing what the article suggests “would give an indirect benefit to oil – they’re saying it’s OK to pump oil out of the ground and use trees to absorb the carbon. But that does nothing to address our country’s dependence on expensive and carbon-intensive fossil fuels like oil, extracted from overseas oil fields or tar sands, where emissions are three to five times the rate of normal crude oil production.”

Brian Jennings, Executive Vice President of the American Coalition for Ethanol (ACE) notes that “Searchinger is not a scientist, economist, or agronomist who has taken the time necessary to study whether his theories about land use and biofuels are validated by on-the-ground measurements. He’s an attorney who appears to have a political ax to grind against biofuels. New technology makes corn ethanol more efficient and sustainable each and every day, while future sources of oil get less efficient and more harmful to the environment.”

The largest gathering of retailers who sell fuel to the public has been going on this week in Las Vegas. The NACS show, which is the annual meeting of the Association for Convenience and Petroleum Retailing, draws some 10,000 visitors from all over the country and even internationally.

It was the first opportunity for the Renewable Fuels Association (RFA) and the American Coalition for Ethanol (ACE) to promote the recently introduced BYO Ethanol blender pump program to retailers. Domestic Fuel reporter Joanna Schroeder was there and talked to Robert White of RFA and Ron Lamberty of ACE about the program, blender pumps in general, and feedback from retailers for this edition of “The Ethanol Report.”

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