Ethanol Industry Reacts to EPA Delay

The ethanol industry wasted no time today in reacting to the Environmental Protection Agency’s announcement that final 2014 volume obligations under the Renewable Fuel Standard will be put off until next year.

RFANewlogoRenewable Fuels Association (RFA) president Bob Dinneen calls it “a cloud of uncertainty with a silver lining.”

Deciding not to decide is not a decision. Unfortunately, the announcement today perpetuates the uncertainty that has plagued the continued evolution of biofuels production and marketing for a year. Nevertheless, the Administration has taken a major step by walking away from a proposed rule that was wrong on the law, wrong on the market impacts, wrong for innovation, and wrong for consumers.

growth-energy-logoGrowth Energy CEO Tom Buis commended EPA and said it was the “appropriate decision” for the agency and is a win for the industry.

Today’s announcement is a clear acknowledgement that the EPA’s proposed rule was flawed from the beginning. There was no way the methodology in the proposed rule would ever work, as it went against the very purpose and policy goals of the RFS. The EPA wisely decided not to finalize the rule so they could fix the flawed methodology. Their initial proposal over a year ago was unacceptable and simply acquiesced to the demands of Big Oil and their refusal to blend more renewable fuels into the marketplace.

ACElogoAmerican Coalition for Ethanol (ACE) Executive Vice President Brian Jennings credits ethanol supporters for helping the EPA reconsider the 2014 RVO obligations under the Renewable Fuel Standard.

Big Oil came close to bullying the Administration to completely rewrite the RFS this year so oil companies could escape their legal responsibility to blend more ethanol in gasoline. But thanks to thousands of comments from ACE members and other biofuel supporters, EPA wisely chose to reconsider their ill-advised proposal which would have legitimized the so-called ‘blend wall’. While we will reserve full judgment until they finalize the 2014 targets next year, it certainly appears the Administration recognizes their proposed RFS changes were inconsistent with legislative history and the Clean Air Act.

Ethanol Coalition: Auto Engineers Expose EPA’s Oil Bias

ACElogoA new paper from automotive engineers shows how the federal government has a bias toward Big Oil. Officials from the American Coalition for Ethanol (ACE) praised a new Society of Automotive Engineers (SAE) paper authored by experts from Ford Motor Company, General Motors Company, and AVL Powertrain Engineering Inc. that concludes that emissions from higher ethanol blends are cleaner than gasoline, and the approach used by the U.S. Environmental Protection Agency (EPA) to estimate exhaust emissions, the Motor Vehicle Emissions Simulator (MOVES) model, is biased in favor of oil.

“We applaud these Ford, General Motors, and AVL Powertrain engineers for exposing that EPA’s MOVES model is biased in favor of a result oil companies prefer and ignores the way gasoline is blended with ethanol in the real-world,” said [ACE Executive Vice President Brian] Jennings. “This is just the latest example of how Big Oil is twisting EPA’s arm to limit ethanol use. First, it appears EPA is about to completely rewrite the Renewable Fuel Standard to help oil companies avoid their legal responsibility to blend fuels, like E15 and E85, which reduce greenhouse gas emissions. Now, EPA is relying on a biased approach for estimating tailpipe emissions, remarkably making gasoline appear cleaner than ethanol.” Continue reading

ACE Thanks Motorclubs’ Endorsement of E15

Gene Hammond and Mark Muncey, co-owners of Travelers Motor Club and Association Motor Club Marketing have endorsed E15 (15 percent ethanol and 85 percent petroleum in motor gasoline). American Coalition for Ethanol (ACE) Senior Vice President Ron Lamberty thanked the motorclubs, who have members in all 50 states, for setting the record straight on E15.

Hammond, who has worked in the auto club business for 40 years said, “Not one of our over 18 million members has called us with a problem related to the new E15 fuel or any E15ethanol blend. Travelers Motor Club and Association Motor Club Marketing support the use of E15 in vehicles as a safe and affordable alternative to gasoline.”

Lamberty called it “eerily appropriate” for the auto clubs to speak out so close to Halloween. “Ethanol opponents have done a masterful job of devising E15 horror stories, and we appreciate these two motor clubs shining the light on the campaign being waged by Big Oil and AAA, and showing drivers that the E15 monsters aren’t real.”

“Real-world results trump ghost stories, and the real-world findings of these two auto clubs mirror what we have heard from fuel station owners who sell E15: they’ve had no customer complaints, no breakdowns, and no repair bills from drivers who fill-up with E15,” continued Lamberty. “In fact, because E15 is a higher-octane fuel that costs less than regular, stations with E15 are gaining customers and E15 has become the second highest volume fuel in most of the stations that sell it.”

Lamberty said the motor clubs’ announcement, coupled with last week’s U.S. Court of Appeals ruling rejecting an E15 lawsuit filed by Big Oil, automakers, and the small engine lobby, “offers hope that truth will win out over fear-mongering”. Continue reading

EPA Fools Ethanol Advocates – Merle Anderson

The following is a guest editorial by American Coalition for Ethanol founder Merle Anderson.

merle-headI just want to remind EPA and Big Oil that I am still around. Since organizing the American Coalition for Ethanol nearly 30 years ago I have just celebrated my 93rd birthday.

I am damn mad because I think we’ve let EPA fool us into letting the fraudulent 10 percent ethanol blend wall stand. It has collapsed grain markets by dishonestly ending ethanol’s growing demand for corn and they call that free enterprise. I call it stealing many, many billions of dollars from agricultural economies.

That blend wall exists because EPA fooled people into thinking it is legitimate because fueling standard cars with E30 illegally increases gasoline’s hazardous emissions. Ever try drinking gasoline? My friend Orrie Swayze’s research agrees that E30 reduces gasoline’s hazardous emissions by 30% because, unlike gasoline, ethanol does not produce known human carcinogenic tailpipe emissions.

I also find it laughable that EPA claims E30 can harm standard auto engines. Show me a legitimate warranty denial. I have never owned a flexible fuel vehicle and fueled my last 7 vehicles with half E85 or used E30 through blender pumps to travel over 600,000 miles. When I traded in the vehicles, the engines were still in top condition.

When blender pumps were installed for the first time, I started hearing many positive remarks about ethanol’s engine performance. EPA tries to deny that standard auto owners have successfully driven millions of miles annually on popular, high octane E30 since blender pumps were installed five years ago. Our typical report still is “more power and can’t tell any difference in mileage compared to E10.”

I challenge agricultural and ethanol leaders to dare and expose EPA’s lies that built the blend wall. I also urge that you use E30 in standard vehicles and openly endorse premium E30 as the legal, safest, best, lowest cost fuel choice on the market today for standard vehicle owners.

Merle Anderson
Climax, MN

ACE Urges Support for STB Reauth Act of 2014

The American Coalition for Ethanol (ACE) is urging leaders of the Senate Commerce Committee to support S. 2777, the Surface Transportation Board Reauthorization Ace of 2014. In a letter, Brian Jennings, executive vice president for ACE writes U.S. corn-based ethanol is the most economical transportation fuel in the world. And when factoring in its favorable blending economics along with the Renewable Fuel Standard (RFS), ethanol is capable of comprising more than its 10 percent share of the U.S. gasoline market.

ACElogo“But in order to do that, reliable and timely rail service is critical,” the letter states. “Unfortunately, during most of 2014, railroads have failed to provide reliable and timely service. Logjams built-up this winter due to extreme cold and snow which reduced the speed and size of trains, and all year long it has appeared that railroads have provided favorable service to crude oil shipments at the expense of ethanol and agricultural commodities….”

“Many of ACE’s ethanol producer members are captive shippers and have reported chronic rail service disruptions this year, such as delayed tank car arrivals, insufficient tank cars received for ethanol off-take, loaded cars parked and overdue for power to arrive, and turn-around times that have doubled. As a result, storage tanks at ethanol plants are full and many of our members have been forced to slow production or worse yet, shut down operations at a time when demand for ethanol is on the rise because of its low price and clean octane benefits, writes Jennings.

The letter continues, “To cope with unreliable rail service, some biorefineries have invested in additional storage or considered adding unit train capability, but it is hard to justify those investments without meaningful commitment by the railroads that service will improve. Moreover, we are concerned that a record harvest of corn and soybeans this fall could make a bad situation on the rails even worse.”

Jennings notes that while the S. 2777 does not immediately nor comprehensively overcome all the problems, it is a step in the right direction.

E15 Could Help Lower Gas Prices at the Pump

The end of summer is here and with the season change, “summer gasoline” and its Reid Vapor Pressure (RVP) requirements will also come to an end. With fall in view retailers who want to offer E15 to their customers may now do so.

“We’re seeing reports and predictions of lower gas prices, with some celebrating the fact that the price is ACElogodown to $3.39 nationwide,” said American Coalition for Ethanol (ACE) Senior Vice President Ron Lamberty. “In the Midwest, where E15, E30, and E85 are more widely available, even E10 prices are already under $3.00 in some markets. Ethanol adds octane and lowers prices because it provides competition for higher priced, lower octane gasoline.”

“E15 brings environmental benefits as well,” continued Lamberty. “Recent studies highlight the reduction in cancer causing emissions offered by E15. E15 means cleaner, higher octane fuel at a lower price and fuel marketers are starting to realize that. Fuel retailers like CHS/Cenex and Protec have taken steps to make E15 available in more markets soon and others will follow.”

Lamberty is encouraging retailers to take note of the growing number of vehicles that can use E15. E15 use is covered under warranty for most cars and light trucks sold in the U.S. for the 2013, 2014, and 2015 model years, and some automakers approve it for 2012 vehicles. That’s 30 million vehicles or more with more vehicles hitting the roads each week that are approved for E15 use.

“This is exactly why Big Oil fights so hard and spends so much time and money to convince EPA and elected officials that the 10% “blend wall” is real, and why they have contract restrictions that prevent branded stations from offering E15.” Lamberty concluded, “It’s not the 5% market share that could be taken by E15 that worries Big Oil – it’s what competition for that 5% does to the prices they can charge for the rest of the gallon. More ethanol means lower prices.”

Quad County Processors Host Grand Opening

The first refinery to produce cellulosic ethanol with a bolt-on process officially opened its doors today.

quad-open-group“This is a historic day not just for the ethanol plant, but for the entire region,” said Delayne Johnson, CEO of Quad County Corn Processors in Galva, Iowa. “This is a perfect example of cutting edge technology, right here in our backyard and we are thrilled to have our plant using this ingenuity.” The Adding Cellulosic Ethanol (ACE) project, newly re-named “Cellerate,” allows QCCP to produce 2 million gallons of cellulosic ethanol each year from corn kernel fiber at their plant in Galva, Iowa.

“Today’s grand opening is a direct result of the ingenuity and hard work of the employees and shareholders of QCCP, but it’s also a direct result of the kind of innovation that occurs when a policy like the Renewable Fuel Standard (RFS) is in place,” said American Coalition for Ethanol (ACE) Executive Vice President Brian Jennings. “More than any other policy enacted by Congress, the RFS has been a catalyst for innovation, including the kind of technology advancement developed at QCCP to make cellulosic ethanol from corn kernel fiber.”

quad-open-bob-brianRenewable Fuels Association president and CEO Bob Dinneen participated in the grand opening ceremony and praised QCCP, noting, “To the management, staff and investors of Quad County Corn Processors I say a hearty congratulations on your vision and your commitment to seeing it through. To EPA I say get out of Washington and see what is happening in places like Galva, Iowa.”

Dinneen tweeted from the event, “Quad Co cellulosic plant can tell Big Oil “we told you so” and make them eat their words!”

RFS Headed to OMB for Review

epaThe Environmental Protection Agency has sent its final rule on 2014 volume obligations under the Renewable Fuel Standard (RFS) to the White House Office of Management and Budget for review in a last step before public release. Renewable fuels groups responded to the news today.

“We’re pleased to see the process moving forward and hope the final rule will show that this Administration is standing behind our national goals for clean, domestic fuels that strengthen our economy and national security,” said National Biodiesel Board Vice President of Federal Affairs Anne Steckel. “The original EPA proposal and continued delays have severely disrupted the U.S. biodiesel industry this year. We can begin to reverse that damage with a meaningful increase in the biodiesel volume that is finalized as quickly as possible so that producers can ramp up production in a timely fashion.”

“While we have not seen the rule, we hold strong in our belief that EPA and OMB will fulfill President Obama’s commitment to biofuels as a means of greater energy independence, lower greenhouse gas emissions, and wider availability of cost-saving alternative fuels for American consumers,” said Renewable Fuels Association president and CEO Bob Dinneen. “This decision is about more than targets and gallons, it is about a rationale that places highest importance on the long term strength of this country and not the bottom line of oil companies.”

“While OMB has up to 90 days to review this rule, what is most important is the content of the final rule,” added Growth Energy CEO Tom Buis. “Ultimately, this final rule should promote the policy goals of the RFS and call for an increase in the production of renewable fuels, so we can continue to reduce our dependence on foreign oil, create jobs at home that cannot be outsourced and mitigate climate change, while we improve our environment.”

Brian Jennings, Executive Vice President of the American Coalition for Ethanol, says his members are pleased with the progress. “Anything short of that turns the keys to the RFS over to the oil companies and puts cellulosic biofuel at risk,” said Jennings. “While all stakeholders have waited a long time for the final rule, and it could take another 30 days or more for interagency review, getting the rule done right is far more important than getting it done quickly.”

Since the rule is not public yet, there is no word on whether the volume requirements were changed from the initial proposal, which reduced the amount of ethanol and kept the biodiesel requirement the same. Senator John Thune (R-SD) expects some middle ground. “I think we’ll see an upward change,” he says. “I hope it’s a significant upward change and I hope that in ’15 they look at this in a different way.”

Thune still expects it will be later in the fall before a final rule is announced. EPA received over 340,000 comments on the proposal.

ACE Elects 2014-15 Board of Directors

ACElogoThe American Coalition for Ethanol (ACE) held re-elections during their 27 annual National Ethanol Conference last week. Eight current board members were re-elected to serve for the remainder of 2014 and through August of 2015:

  • Bob Sather, Chippewa Falls, Wisconsin representing ACE Ethanol, LLC
  • Chuck DeGrote, Clara City, Minnesota representing Chippewa Valley Ethanol Company
  • Steve Vander Griend, Colwich, Kansas representing ICM, Inc.
  • Ron Wetherell, Cleghorn, Iowa representing Little Sioux Corn Processors
  • Gary Marshall, Jefferson City, Missouri representing Missouri Corn Growers Association
  • Todd Sneller, Lincoln, Nebraska representing Nebraska Ethanol Board
  • Nick Sinner, Fargo, North Dakota representing Red River Valley Sugar Beet Growers
  • Merle Anderson, Climax, Minnesota representing Minnkota Power Electric Cooperative

Three individuals were nominated and elected to serve as new board directors:

  • Chris Wilson, Marshall, Missouri representing Mid-Missouri Energy, LLC
  • David Kolsrud, Brandon, South Dakota representing Badger State Ethanol
  • Greg Krissek, Wichita, Kansas representing Kansas Corn Growers Association

“The ACE board of directors is a dedicated group of active volunteers who represent the grassroots diversity of our entire membership,” said Brian Jennings, ACE Executive Vice President. “Our members are very capably represented by the passion, expertise, and experience the ACE board brings to the table and we are grateful for their support and leadership.”

Another Successful ACE Conference

ace14-brianAmerican Coalition for Ethanol Executive Vice President Brian Jennings was pleased with the 27th annual ACE conference held last week in Minneapolis.

“It was another great conference, we covered a lot of important topics,” said Jennings as the conference concluded. “We try to feature our members as much as we can, whether it’s technology they’re implementing at their plant or they’re working on exporting ethanol or distillers grains – we try to give our members the spotlight and I think we did that once again.”

Jennings said one of his favorite sessions during the conference was the Ethanol Innovators panel. “It shows everyone these producers are not relying on the past, they’re looking to the future … they want to reduce their expenses, increase their efficiency and position themselves to be competitive for the long run.”

While Jennings says there is little time left in this year’s Congressional Session to worry about any anti-ethanol legislation being past, he is concerned about the elections and he encouraged his members to exercise their right to be an informed voter. “Talk to these candidates and find out their positions on ethanol and hold them accountable,” he said.

Finally, Jennings adds that next year’s conference will be in Omaha – see you then! Interview with Brian Jennings, ACE Executive Vice President

27th Annual Ethanol Conference photo album

ACE Retailer Roundtable

ace14-retailersTwo fuel retailers took the stage at the American Coalition for Ethanol conference last week in Minneapolis to talk about the trials and rewards of offering their customers a real choice at the pump.

Bruce Vollan (left) of Midway Service in Baltic, SD and Kent Satrang, CEO of Petro Serve USA in North Dakota, shared their stories of why they installed blender pumps at their locations.

“We’re about seven years of having our blender pumps in place,” said Vollan. “It was an ideal time for us to make a change as a small town business.” And, he added, it has grown that business exponentially.

“We’re a Farmers Union oil company,” Satrang said. “We are owned by farmers, so they would like us to sell their fuel.” Beyond that, he just wants to offer his customers a choice.

Both of them also talked about the costs involved in putting in the pumps and offering higher blends and what it has ultimately meant to their communities. Listen to their conversation here: ACE Retailer Roundtable

27th Annual Ethanol Conference photo album

ACE Awards Celebrate Power by People

Recipients of the annual awards presented last week by the American Coalition for Ethanol (ACE) exemplified the organization’s new theme of “Power by People.”

ace14-gene-lacyGene Griffith of Patriot Renewable Fuels received the organization’s Grassroots Award from ACE Director of Member and Industry Relations Lacy Dixon. Griffith was recognized for the many ways Patriot has promoted ethanol to the public, including an electronic sign on the highway near the plant in Annawan, Illinois that features revolving messages about the benefits of ethanol. They also have been very active on social media with Facebook and Twitter accounts.

“Producers also have to help educate the public, as well as the industry associations,” said Griffith. Interview with Gene Griffith, Patriot Renewable Fuels

ace14-jerryRecognized for excellence in journalism was Jerry Perkins, editor with Biofuels Journal. Perkins was Farm Editor with the Des Moines Register for more than 15 years and says there is no conflict between him being a journalist and his support of ethanol.

This year’s Paul Dana Award went to Charlie Good, owner of the Good and Quick store in Nevada, Iowa. Good had a conflict and was unable to attend the ACE conference but I interviewed him in March at the ACE Fly-in where he told his story about deciding to offer higher blends at his store over his suppliers 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

As already noted, Rep. Collin Peterson (D-MN) received the Merle Anderson Award this year, presented by Merle himself. The Father of Ethanol was in rare form as he presented the award to his congressman, as you can hear all of in the audio file and see a portion in the video below. Merle Anderson Presents Award to Rep. Collin Peterson

27th Annual Ethanol Conference photo album

Increasing Ethanol Plant Throughput

ace14-enogen-lopezSyngenta’s Enogen corn trait technology is the first genetically modified output trait in corn specifically for the ethanol industry and in the past two years since it has been released the industry has seen increasing adoption.

“We’re a new product that’s been adopted by 6-8 plants already,” said Paul Lopez with Syngenta who gave a break out session at the American Coalition for Ethanol conference on how Enogen is helping plants increase throughput. Giving the presentation with him was Tory Kort with Chief Ethanol Fuels in Nebraska, which uses Enogen corn, who shared the results they have seen. “Our enzyme is pretty unique in terms of how it works … it really reduces starches down, making more sugars available, increasing the plant’s efficiencies, so increasing yield and increasing throughput,” added Lopez.

The first plant to adopt Enogen was Quad County Corn Processors, which produced the first gallons of cellulosic ethanol just last month. “They’ve been using our product for two years now,” said Lopez. “This is a win-win. The ethanol plant wins, the local grower wins, the local community wins.”Interview with Paul Lopez, Syngenta Enogen

27th Annual Ethanol Conference photo album

Urban Air Initiative Update at ACE

ace14-uaiThe Urban Air Initiative (UAI) is a non-profit organizations dedicated to improving the quality of motor fuels to improve air quality and enhance public health, especially in urban areas.

UAI is building a diverse coalition of stakeholders to work on replacing harmful aromatic compounds in gasoline with safer alternatives, like ethanol. At the American Coalition for Ethanol conference last week, UAI’s Steve Vander Grind (left) and attorney Todd Palmer with Michael Best and Friedrich provided an update on the organization’s plans and how they hope to grower domestic use of ethanol.

Urban Air Initiative Update

27th Annual Ethanol Conference photo album

RFS Update from EPA at ACE Meeting

ace14-epaEnvironmental Protection Agency official Paul Machiele visited the American Coalition for Ethanol conference this week in Minneapolis to discuss various issues, including plans for the 2014 volume obligations under the Renewable Fuel Standard (RFS).

Machiele, who is director for Fuel Programs in EPA’s Assessment and Standards Division, said they understand the rule is very important and they are working very hard to get it finalized as soon as possible. “I can’t say when it’s going to come out because that will depend in a large part on the review time when it gets into the interagency review process,” he said. “That review can take anywhere from 30-90 days,” he continued, saying he hopes it will be expedited.

“We were blessed with 300,000 comments on this rule-making and not only do we have to finalize the rule-making but we have to respond to the comments that we receive,” said Machiele, adding that his staff is working on that project right now.

As it stands, Machiele says EPA has extended the compliance deadline for obligated parties so “they know what the standards will be for 2014 before they make their final decisions on buying, selling, trading, holding RINs for 2013.” Meanwhile, he acknowledged that the 2015 standards should already be proposed by now, but they expect to get that done shortly after the 2014 rule is finalized and “hoping that we can move that to final rule a little faster.”

Machiele also discussed final rules for new pathways, cellulosic feedstocks, and RINs, as well as Tier 3 regulations, and frankly answered several questions from producers at the conference. Comments from Paul Machiele, EPA

27th Annual Ethanol Conference photo album