In the new World Agricultural Supply and Demand Estimate, USDA has increased the amount of corn forecast to be used to make ethanol and co-products such as the livestock feed distillers grains.
Corn used in ethanol production is projected 25 million bushels higher at 5.15 billion bushels for the 2014-15 marketing year. The reason is a reduction in expected sorghum use for ethanol and the strong pace of weekly ethanol production reported so far for the marketing year.
In the November crop forecast, USDA slightly lowered corn production this year to 14.4 billion bushels, with yields now expected to average 173.4 bushels per acre. If realized, this will still be the highest yield and production on record for the United States.
“This is positive news for the market overall as we’re expecting demand to rise to meet these record yields,” said American Farm Bureau Deputy Chief Economist John Anderson. “An estimated increase in ethanol production should also help to absorb this year’s bumper crop.”
The drop in the national production estimate for corn seems to be coming from traditionally high-yield states that are now seeing lower estimates this month, Anderson said. The Iowa yield estimate was shaved by two bushels per acre, and Minnesota’s came down by five.
The main reason for the slight drop in the corn forecast is a slow harvest and weather challenges, that are now including heavy snow in the upper Midwest. The latest crop progress report shows Wisconsin, Michigan, Colorado and Indiana lagging behind the most in harvest, but significant progress was made in the last week so that the corn harvest nationwide now stands at the five year average of 80 percent.
A group representing ethanol producers in this country is giving the state of Washington a piece of its mind on the state’s draft report on the potential implementation of a Low Carbon Fuel Standard (LCFS). This news release from Growth Energy says the comments outline how implementation of a LCFS could potentially displace clean burning, domestically-produced renewable fuels without significant environmental benefit.
Upon submission of the comments, Chris Bliley, Director of Regulatory Affairs for Growth Energy, noted, “As Washington considers a potential low carbon fuel standard, we wanted to make them aware of our strong objection to the inclusion of controversial theories such as indirect land use change. Ethanol continues to significantly lower greenhouse gas emissions in our transportation fuel. Washington should carefully consider these issues before moving forward with a California-style LCFS regulation.”
The comments outlined that, “With the success of a national biofuels program in mind, Washington’s draft report raises a number of issues related to the potential adoption of a low carbon fuel standard (LCFS) in Washington. One of the most controversial features of a potential state-level LCFS regulation is the belief that by regulating the carbon intensity of alternative fuels somehow value is added separate and apart from other efforts to reduce transportation sector greenhouse gas emissions by causing changes in biofuel production methods… To date there has been no net reduction in GHG emissions nationwide; the only impact has been ‘fuel shuffling,’ a resulting phenomenon which itself is likely to increase GHG emissions by requiring the transport of ethanol and other fuels further distances than if states did not try to regulate the carbon intensity of the ethanol sold or used within their borders.”
You can read all of Growth Energy’s comments here.
The “Bobby Likis Car Clinic” featured Renewable Fuels Association Senior Vice President Geoff Cooper on show’s live globalcast this past Saturday, November 8.
Cooper addressed a variety of topics including the truth behind the fictional food vs. fuel argument, as well as the hot button issue of greenhouse gas – or GHG – emissions and the role ethanol plays in reducing their output into the ozone. Cooper will also share with Car Clinic audiences the benefits and the commercialization of cellulosic ethanol.
“RFA recently conducted a study that shows while corn prices have plummeted, food prices have remained steady or have risen,” said Cooper. “The petroleum industry would like to pin any increase in food prices on the ethanol industry when in fact it is oil that drives food prices.”
Listen to Cooper’s interview with Bobby here and watch the video below: Bobby Likis interviews RFA's Geoff Cooper
American ethanol exports could be expanding to Panama and Peru. Growth Energy officials, along with the U.S. Grains Council and the Renewable Fuels Association, took part in a market development mission to explore export opportunities for the green fuel to the Central and South American countries.
“The mission has been a great experience,” said [Alex Marquis, Logistics Manager of Marquis Energy, who represented Growth]. “The mission delegates met with a number of Peruvian government officials over the span of two days, and the access provided was impressive. Though more work and dialogue is needed to cultivate relationships with key Peruvian contacts, these discussions revealed that Peru’s burgeoning economy offers growth potential for American renewable energy groups,” Marquis added.
“Exploratory trade missions like these allow the industry to identify new market opportunities across the globe and raise awareness of the benefits of renewable fuels. Ethanol can play a key role in improving the global environment and reducing the world’s dangerous dependence on fossil fuels,” stated Tom Buis, CEO of Growth Energy.
Growth Energy also participated in trade missions to China, Korea and Japan earlier this year.
California-based ethanol producer Trestle Energy gets the green light to produce its advanced biofuel in British Columbia, Canada. Trestle, with production facilities in Iowa, can now start producing and selling its low-emissions biofuel in the province, as BC recognized the company as the lowest emissions ethanol producer in America.
Trestle Energy will now begin partnering with existing ethanol plants in Iowa, Minnesota, and across the Midwest to ramp up production of its low carbon biofuels and make the fuel available to BC consumers. Trestle’s method of production will strengthen export markets for American companies and help them effectively compete with overseas biofuel producers, while also helping advance important climate and energy security objectives.
“We are thrilled that British Columbia has moved quickly to approve our fuel pathways, so that we can begin to get our advanced biofuels to market,” said James Rhodes, co-founder and president of Trestle Energy. “We look forward to partnering with ethanol plants to supply Canada with low carbon biofuels, and we hope to bring them to the United States as soon as possible so that we can provide Americans with clean, affordable, low carbon energy.”
Trestle Energy also has petitions currently pending with the Environmental Protection Agency (EPA)—filed in November 2013—and with the California Air Resources Board (CARB)—filed in May 2014.
A group representing ethanol interests is calling on Oregon to treat ethanol the same as other clean fuels in the state. The Renewable Fuels Association (RFA) sent in comments to the Oregon Department of Environmental Quality (DEQ) detailing a number of requested changes to the proposed rule for Phase 2 of the Oregon Clean Fuels Program (CFP), including the recommendation that indirect effects be withheld from the program’s lifecycle carbon intensity analyses for various fuel pathways.
Phase 1 of the Oregon CFP, which is structured similarly to California’s Low Carbon Fuel Standard (LCFS), included carbon intensity scores for ethanol and all other fuel pathways that were based strictly on verifiable direct emissions. However, for Phase 2 of the program, Oregon DEQ is proposing to introduce subjective and uncertain penalty factors for hypothetical indirect land use changes (ILUC) for select biofuels, but no indirect effect penalty factors for any other fuel types. RFA’s comments underscore the fact that “Inclusion of highly uncertain and prescriptive ILUC factors creates an asymmetrical and discriminatory framework for the CFP.”
RFA urged that DEQ remove ILUC from the proposed rule “…until such time as there is broad scientific agreement on the best methodology for estimating the indirect effects for all fuels” and that “If DEQ includes ILUC for biofuels, it must also include indirect emissions associated with all other regulated fuels (including baseline petroleum).”
Even if DEQ’s proposal to include ILUC was justified, the letter points out that “…DEQ is proposing to use factors that have been shown to be grossly exaggerated and based on outdated information and data.” In fact, DEQ is planning to adopt ILUC penalties developed by the California Air Resources Board (CARB) in 2009 for that state’s LCFS. Even CARB has recognized that its 2009 ILUC factors are flawed and is planning to propose revisions to those values.
RFA added that it will support “performance-based low carbon fuel programs that are grounded in the principles of fairness, sound science, and consistent analytical boundaries.” The group continued that introducing into the regulatory framework concepts without scientific integrity and balance “only creates stakeholder division and controversy.”
The National Corn Growers Association (NCGA) and several other agricultural sent a letter to President Obama this week asking him to intervene with the Environmental Protection Agency regarding its proposed cuts in the 2014 volume obligations for the Renewable Fuel Standard.
“The blending targets and the methodology in your administration’s proposed rule are already causing significant harm to the biofuel sector,” the letter states. “These impacts are reverberating throughout the U.S. agriculture economy, and we expect this trend to continue if the targets and the methodology in the rule are not corrected.”
The letter discusses how the ag sector has met its responsibility in growing sufficient feedstock for biofuels, but is also working with the ethanol industry on infrastructure and advanced fuels. The letter concludes: “The EPA’s proposed policy decision is driving one of our key economic engines – the biofuel sector -¬‐ overseas. We have invested in response to the signals in the RFS and are poised to deliver the very low carbon fuels you have sought for so long. Instead of reaping the economic benefits of this investment with a build-¬‐out of a domestic biofuel industry, the methodology proposed by EPA is offshoring the industry – and our market. This is a decision we cannot afford in America’s heartland.”
In addition to NCGA, organizations sending the letter included the Agricultural Retailers Association, American Farm Bureau Federation, Association of Equipment Manufacturers, National Association of Wheat Growers, the National Farmers Union and National Sorghum Producers.
Iowa high school students will once again compete to see who can produce the best video to promote the future of biodiesel, ethanol and E15. The Iowa Renewable Fuels Association (IRFA) launched the 5th Annual “Fuel the Future” Video Contest for Iowa high school students with the top three video entries receiving prizes in the amounts of $1,000, $600 and $400 respectively; airing at the 2015 Iowa Renewable Fuel Summit on January 27; and being featured on IRFA’s YouTube® channel.
“The IRFA video contest is now open, and we’re excited to see the creative ways Iowa high school students promote ethanol and biodiesel this year,” stated IRFA Communications Director T.J. Page. “With attacks from ethanol and biodiesel opponents ramping up, we can’t wait to see how Iowa high school students set the record straight on renewable fuels through their highly entertaining and informative videos.”
The Fuel the Future contest is limited to students currently attending high school in Iowa (grades 9-12 in a public, private or home school). Video entries may not exceed two minutes in length and must be submitted to IRFA via DVD, flash drive, or secure web link. To be considered for the contest, all completed video entries must be received in the IRFA office by January 16, 2015. For more information, including the official entry form and contest rules, please visit www.iowarfa.org/FueltheFuture.php. For additional questions, please contact T.J. Page at (515) 252-6249 or tpage@IowaRFA.org.
To get some ideas, check out last year’s winner, produced by John Low of Marion and titled “E15: The Fuel of the Future,” here.
Students interested in the ethanol industry have a chance to attend the 2015 National Ethanol Conference in Grapevine, Texas through a scholarship opportunity offered by the Renewable Fuels Association (RFA) and the Renewable Fuels Foundation (RFF).
The 20th annual National Ethanol Conference, titled “Going Global,” will offer college students a chance to hear key industry leaders and policymakers address topics such as the Renewable Fuel Standard, E15, international trade, next-generation ethanol, rail transportation, and more. In addition, they will have a unique opportunity to interact with key leaders of the U.S. ethanol industry.
“The National Ethanol Conference offers an excellent opportunity for college students to get their feet wet and gain an in-depth look into the ethanol industry,” said Mike Jerke, chairman of the RFF and CEO of Guardian Energy Management LLC. “Our goal is to educate the next generation of biofuel leaders and the conference is the perfect place for them to learn, ask questions, and network.”
Interested students are asked to submit a 500-word essay explaining how their attendance at the National Ethanol Conference will help them achieve their future goals. They are also asked to submit two letters of recommendation, a current resume, and a school transcript. The scholarship is only available to students attending a U.S. institution of higher learning or foreign students affiliated with the U.S. ethanol industry.
Applications must be received by Dec. 12 to receive full consideration. Application materials can be found here: www.NationalEthanolConference.com/pages/scholarships.
The Iowa Renewable Fuels Association (IRFA) is pleased with the results of Tuesday’s election in the state and the strong support for renewable fuels among the winning candidates.
“It’s not surprising that ethanol and biodiesel enjoy broad, bipartisan support in Iowa,” stated IRFA PAC Treasurer Walt Wendland. “It’s also encouraging to see that renewable fuels will remain in good hands in Iowa. We look forward to working with all of the 2014 election winners for state and federal offices to continue to preserve and advance Iowa’s leadership in renewable fuels production, agriculture and environmental stewardship.”
In the races for federal office, Iowa elected Joni Ernst to the U.S. Senate, and David Young and Rod Blum to the U.S. House. Iowans also re-elected Governor Terry Branstad, and Reps. Steve King and Dave Loebsack. Each winning candidate reported strong support for renewable fuels and the federal Renewable Fuel Standard (RFS) in IRFA’s renewable fuels candidate survey.
Auto manufacturers explicitly approve the use of E15 (15 percent ethanol blend fuel) in approximately two-thirds of new vehicles, according to the Renewable Fuels Association (RFA).
RFA’s analysis of model year (MY) 2015 warranty statements and owner’s manuals finds that nearly 63 percent of MY 2015 vehicles will have E15 approval from their manufacturers. E15 is approved by the Environmental Protection Agency (EPA) for all 2001 and newer vehicles — accounting for roughly 80 percent of the vehicles on the road today. When coupled with expected MY 2015 flex-fuel vehicle (FFV) production, it is estimated that E15 will be allowed in close to 70 percent of MY 2015 vehicles. Manufacturers approve the use of up to 85 percent ethanol blends in FFVs.
The RFA analysis revealed several interesting trends:
After approving the use of E15 in some of its 2014 Honda and Acura models, Honda Motor Company has extended E15 warranty coverage to all models in 2015.
All Toyota models in 2015 include explicit E15 approval, up from just a fraction of Toyota models in 2014. Just as in 2014, E15 is approved for use in most, but not all, 2015 Lexus models.
For the fourth year in a row, General Motors approves the use of E15 in all models. Similarly, E15 is approved in all Ford models for the third year in a row. Vehicles from these two automakers alone account for roughly one-third of sales in the United States.
Audi, Jaguar, Land Rover, Porsche, and Volkswagen also expressly approved the use of E15 in their 2015 models.
The analysis also found that the Chrysler Group failed for the fourth year in a row to approve the use of E15 in owners’ manuals for its models. Despite that, a significant share of Chrysler output is expected to be FFV-capable, meaning E15 is approved for use in those vehicles.
A 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
DuPont will now be sitting on the governing board of the Renewable Fuels Association (RFA). The company has been an associate RFA member for more than 10 years and has now upgraded its membership as its first cellulosic ethanol plant is in its final stages of construction. The biorefinery will be co-located next to Lincolnway Energy in Nevada, Iowa and when complete will produce 30 million gallons per year of ethanol using corn ag waste.
“Next generation cellulosic ethanol is emerging on the market and DuPont is at the forefront of innovation. Their knowledge and expertise in all aspects of the biofuels industry make them a valuable addition to the Renewable Fuels Association,” said Bob Dinneen, president and CEO of the RFA. “I am eager to work together to advance the renewable fuels industry, which is already directly and indirectly employing nearly 400,000 people, reducing GHG emissions, and lowering America’s foreign oil dependence.”
William Feehery, president of DuPont Industrial Biosciences said of their renewed commitment to the ethanol association, “RFA is a leading voice in Washington on issues related to our industry and we look forward to working even more closely together as we reach full cellulosic production in the coming year. We acknowledge the hard work RFA has done to promote and defend the Renewable Fuel Standard (RFS) both as an individual organization and as our partner in the Fuels America Coalition. A stable RFS is vitally important to support growth for the existing corn ethanol industry while garnering the investment needed to expand and grow cellulosic ethanol in the United States. We must keep the technology, research, and development here in the United States so consumers can continue to have choices at the pump and America can reduce its reliance on foreign oil.”
Renewable Fuels Association (RFA) Director of Regulatory Affairs Kelly Davis has been appointed to the Department of Commerce’s Renewable Energy and Energy Efficiency Advisory Committee.
According to Secretary of Commerce Penny Pritzker, the function of the committee is to “provide consensus advice on the development and administration of programs and policies to expand U.S. renewable energy and energy efficiency exports.”
“It is truly an honor to be selected by Secretary Pritzker to serve on the Renewable Energy and Energy Efficiency Advisory Committee,” said Davis. “I look forward to having a seat at the table and helping Secretary Pritzker ensure that our global trading partners understand and appreciate the benefits of U.S. produced ethanol in reducing consumer gasoline prices, improving energy diversity and security, and addressing climate change.”
Davis recently participated in a trade mission to China, led by USDA Under Secretary Michael Scuse, to promote U.S. ethanol and co-products and strengthen the trade relationship between the two countries. Last year, she joined a similar trade mission, led by the U.S. Grains Council, to South Korea and Japan. The RFA board of directors has made opening new markets for ethanol and distillers dried grains with solubles (DDGS) abroad a top priority, and Davis’ appointment to this prestigious advisory committee reflects that commitment.
In a recent blog post authored by Geoff Cooper, senior vice president of the Renewable Fuels Association (RFA), the American Petroleum Institute (API) recently released a study that argues that the fracking boom has led to dramatically lower prices for crude oil and refined products between 2008-2013. Cooper wrote that the study suggests that increased domestic production of crude oil, natural gas liquids (NGLs) and lease condensate from fracking has already extended U.S. supplies and helped to lower gas prices.
The study finds that every 1 million barrels/day of new supply reduces consumer prices for petroleum products between $0.06-0.20 per gallon. Cooper writes that according to economics more supply generally results in lower prices, in this case there are two problems with API’s rationale.
- Problem 1: Global demand for petroleum products continues to grow faster than global supply. EIA data show global production of crude oil, NGLs and condensate grew by 4.1 million barrels/day between 2008 and 2013. But global consumption of those products ramped up by 5.4 million barrels/day over the same period. Thus, demand gains outstripped supply gains by more than 30%.
- Problem 2: When energy economist Phil Verleger and researchers at Louisiana State University, Iowa State University, University of Wisconsin, the Department of Energy, and others separately showed that extending the U.S. gasoline supply with ethanol leads to lower pump prices, Big Oil defiantly screamed “NOT SO!” Verleger found that consumer paid $0.50-$1.50 per gallon less for gasoline in 2013 because of ethanol’s extension of the fuel supply. His conclusion corroborated results from Iowa State/University of Wisconsin that showed consumers saved up to $1.09 in 2012 due to ethanol’s aggregate effect on gasoline supplies.
Cooper ends his article by asking the question, “So, which is it API? Does adding volume to the fuel supply reduce prices, or doesn’t it?”