After the defeat Tuesday in the Senate of an amendment by Sen. Tom Coburn (R-OK) to immediately eliminate the Volumetric Ethanol Excise Tax Credit (VEETC), the ethanol industry is supporting another approach and the two concepts could be heading for a showdown in the Senate before the end of the month.
“That indeed has been teed up with a commitment by the majority leader for a vote on Coburn again in a couple of weeks and a vote on an alternative,” says Renewable Fuels Association CEO and President Bob Dinneen.
The alternative is the Ethanol Reform and Deficit Reduction Act introduced this week by Senators John Thune (R-SD) and Amy Klobuchar (D-MN) that would end the tax incentive this year while still helping the industry move forward. The legislation would provide tax incentives for infrastructure such as blender pumps, and for cellulosic biofuels development, as well as a variable safety-net determined by the price of oil. “It’s very fiscally responsible and makes sense as an insurance that the investment that the taxpayer has already made in this industry will be protected,” Dinneen said.
The ethanol industry and agriculture groups are supportive of the alternate approach, which would save about $1 billion toward deficit reduction and Dinneen hopes it will go head-to-head against the Coburn amendment. “I welcome that side-by-side comparison,” he says. “I think there would be a great deal of support for our vision.”
In this edition of “The Ethanol Report,” Dinneen talks about why ending the ethanol tax credit without a plan to move forward would be disastrous and how the ethanol industry is taking the initiative to work with Congress and develop a plan that cuts spending while continuing to move the country toward energy independence.
Listen to or download the interview with Dinneen here: Ethanol Report on Senate Legislation
The ethanol industry is facing a double pronged attack in the U.S. Senate.
Sen. Tom Coburn (R-OK) went to the floor last night with an amendment to eliminate the Volumetric Ethanol Excise Tax Credit (VEETC) immediately, while at the same time Sen. John McCain (R-AZ) is proposing to eliminate funding of ethanol infrastructure.
“It is a two-pronged attack, it is designed to stop the growth and evolution of the ethanol industry, it is decidedly anti-farmer, anti-consumer and really leads us down the path toward continued reliance on imported energy and higher prices at the pump,” said Renewable Fuels Association president and CEO Bob Dinneen.
The Coburn amendment is being added to an economic development bill and Dinneen says it has nothing to do with reducing the federal deficit. “This isn’t about fiscal responsibility or his amendment would have included the tens of billions of dollars that taxpayers continue to contribute to oil companies,” said Dinneen.
Dinneen urges ethanol producers, corn growers and anyone who buys gas to call their senators and encourage them to oppose the amendments. “It’s an attack on the nation’s rural economy, it’s an attack on our energy security and it’s an attack on consumers across this country,” he said.
The VEETC is scheduled to expire at the end of this year and the ethanol industry is already working with Congress to develop a phase-out plan that would allow the continued growth and development of the renewable fuel.
Listen to or download Dinneen’s comments here: RFA CEO Bob Dinneen
A bill was introduced today in the Senate that would modify the current ethanol blender’s tax credit set to expire at the end of this year.
Renewable Fuels Association president and CEO Bob Dinneen says the bipartisan Domestic Energy Promotion Act of 2011 introduced by Sen. Chuck Grassley (R-IA) already has a number of co-sponsors. “Senators Conrad, Johanns, Klobuchar, Franken, Tim Johnson, Senator Harkin and Ben Nelson of Nebraska, so it is a bipartisan bill,” said Dinneen.
The bill modifies the current Volumetric Ethanol Excise Tax Credit (VEETC) by tying the tax incentive to the price of oil. “This proposal would continue to provide a demand driver for ethanol when oil prices are low, while not requiring the taxpayer to subsidize gasoline marketers when the marketplace is already providing an incentive to blend,” Dinneen said.
The bill includes two other provisions that would help increase ethanol infrastructure and investment in next generation technology. “The reform of the existing tax incentive to be a variable incentive, infrastructure tax incentives that will encourage marketers to invest in blender pumps, and cellulosic tax incentives to allow the industry to continue to evolve sets up a policy that we think is fiscally responsible and makes great sense for this nation’s energy and economic future.”
Listen to or download an interview with Dinneen about the bill here: Ethanol Report on Domestic Energy Promotion Act
The latest average cost for a gallon of gas nationwide, as reported by AAA, is $3.88, but it would already be $4.00 a gallon without ten percent ethanol.
According to the Renewable Fuels Association (RFA), based on current market conditions and federal renewable fuels policy, 10 percent ethanol blends (E10) are keeping gasoline prices $0.12 per gallon cheaper than they otherwise would be.
I talked with RFA Association Vice President of Research and Analysis Geoff Cooper who explains the math behind that calculation (which you can also find on the RFA website) and how the 45 cent per gallon tax credit creates additional savings at the pump for consumers in this edition of “The Ethanol Report.”
Listen to or download the Ethanol Report on gas prices here: Ethanol Report on Gas Prices
A new partnership between the ethanol industry and boat racers is hoping to dunk the image of ethanol as a bad fuel for boat engines.
Through the alliance between the Renewable Fuels Association (RFA) and the National Boat Racing Association (NBRA), the 2011 National Boat Racing Association Race Series will be “fueled with pride” and ten percent ethanol.
This edition of “The Ethanol Report” podcast features features comments from RFA Director of Market Development Robert White and NBRA president Dan Crummett about the new partnership and how it will demonstrate the safety and performance of ethanol-blended fuel in boat engines.
Listen to or download the Ethanol Report here: Ethanol Report on Boat Racing Partnership
The Renewable Fuels Association (RFA) celebrated 30 years of advocating for ethanol this week during the 16th annual National Ethanol Conference in Phoenix.
This edition of “The Ethanol Report” podcast features an interview with RFA president and CEO Bob Dinneen on the conference, the state of the ethanol industry, the new Advanced Ethanol Council and recent developments in Congress regarding funding for ethanol expansion, as well as thoughts about higher oil prices.
The 2011 National Ethanol Conference Photo Album is up to date with all the conference photos and more posts will be added in the days to come. It was a great conference and we would just like to say “Happy Anniversary RFA!”
Listen to or download the Ethanol Report on the 2011 NEC here: Ethanol Report on National Ethanol Conference
In this edition of “The Ethanol Report” podcast, we hear from the executive director of the newly formed Advanced Ethanol Council (AEC), Brooke Coleman.
Coleman has been involved with the ethanol industry for over a decade, most recently as Executive Director of the New Fuels Alliance. He says that the new organization came together around a common theme. “The common theme is that both existing corn ethanol producers and tomorrow’s cellulose and advanced ethanol producers have a common interest – opening up U.S. fuel markets to the use of ethanol.”
“Advanced ethanol is truly on the cusp of commercialization,” he continued. “It’s a fuel that is not 15 years down the road, it’s a realistic option and there are plants in the ground already today producing advanced ethanol at demonstration and commercial scale.”
Coleman points out that the organization encompasses all types of advanced ethanol, not just cellulosic, which is a process that specifically uses cellulose to create ethanol. “At the end of the day, we want to make sure we develop market places for advanced ethanol – not just one type,” he said.
The AEC represents a wide range of advanced ethanol technologies utilizing feedstock from grasses and corn stalks to wood waste, municipal solid waste and algae to produce ethanol. The industry leaders founding the AEC include Abengoa Bioenergy , BlueFire Renewables, Coskata, Enerkem , Fulcrum BioEnergy, Inbicon, Iogen, Mascoma, Osage Bio Energy and Qteros, together with the Renewable Fuels Association.
Listen to or download the Ethanol Report on the new AEC here: Ethanol Report on Advanced Ethanol Council
The February USDA World Agriculture Supply and Demand Estimate (WASDE) report out today includes some revisions in grain use numbers. This edition of the Ethanol Report podcast with Renewable Fuels Association Vice President of Research Geoff Cooper takes a look at those numbers and provides some perspective from the ethanol industry standpoint.
For U.S. corn supplies, USDA lowered its forecast of marketing year ending stocks to 675 million bushels, down 70 million bushels from the January estimate. The change comes from slight increases in the estimates of corn for ethanol use and sweetener/starch use. Globally, USDA is estimating a slightly smaller grain (wheat, rice, corn, etc.) supply than last year’s record amount of more than 2.7 billion metric tons. “People lose sight of the global picture of the grain markets,” Cooper says. “The fact of the matter is, the global grain supply remains very strong.”
Cooper says RFA believes USDA may be slightly overestimating corn for ethanol use, even though export demand prospects remain strong. “Even if we do assume that we export 300 or 400 million gallons of ethanol in this marketing year, that still means the domestic market is going to need to absorb the remaining 13.3 or 13.4 billion gallons, which seems unlikely given the E10 blend wall and the fact that E15 hasn’t really penetrated the market yet.”
The estimates are likely to re-ignite the food versus fuel debate, but Cooper notes that higher prices will likely mean farmers will plant more corn this year. “It’s a basic concept that farmers respond to price signals,” he said.
Listen to the Ethanol Report here: Ethanol Report on February WASDE
Now that 2010 is just a memory and Congressional leaders are returning to Washington this week to open the first session of the 112th Congress, what does the future hold for ethanol?
In this edition of “The Ethanol Report,” Renewable Fuels Association president and CEO Bob Dinneen gets out his crystal ball and talks about the year ahead for the ethanol industry.
Dinneen discusses the future for ethanol policy in the new Congress, what the EPA needs to do yet as far as getting E15 on the road, the next step in the challenge to California’s Low Carbon Fuel Standard, and plans for the 16th annual National Ethanol Conference, February 20-22 in Phoenix.
Listen to the Ethanol Report here: Ethanol Report on 2011
As the champagne corks pop this New Year’s Eve, the ethanol industry will be celebrating more than they were a year ago.
In this edition of “The Ethanol Report,” Renewable Fuels Association president and CEO Bob Dinneen talks about the year that 2010 was for the ethanol industry. “In many ways, 2010 was a record setting year,” Dinneen says. It was record setting for production, at about 13 billion gallons, and for exports. It also was the year that ethanol ran into the blend wall, and that EPA approved at least limited use of up to 15 percent ethanol in regular gasoline. But, the high note was the extension of the blenders tax credit for ethanol during the lame duck session of Congress, a priority for the industry that now provides for a year’s worth of breathing room to move on to the next level.
Listen to the Ethanol Report here: Ethanol Report on 2010
In this edition of “The Ethanol Report” we get reaction from Renewable Fuels Association president and CEO Bob Dinneen on the passage by the Senate of the compromise tax package that includes a one-year extension of important tax incentives for ethanol production and use.
Dinneen says they are thrilled with passage of the measure, which gives some stability to the industry for another year. “Would we like it to have been a longer incentive, as opposed to just a year? Certainly. But this allows us to move forward, it provides some certainty to the industry, and hopefully, it allows a more comprehensive discussion about energy tax policy to ensue next year,” he said.
Dinneen now expects the measure to pass the House with the ethanol incentives in place.
Listen to the Ethanol Report here: Ethanol Report on Senate Tax Vote
The California Air Resources Board (CARB) has decided to use the latest research on indirect land use change (ILUC) for implementing the state’s Low Carbon Fuels Standard (LCFS), meaning the current ILUC penalty for corn ethanol likely will be cut by at least half by the spring of 2011. The Renewable Fuels Association (RFA) says the resolution is good news for the ethanol industry, but expressed concerns about waiting until after the standard is implemented in January to make the revisions.
RFA Vice President for Research Geoff Cooper talks about the decision and its impact in this edition of “The Ethanol Report.”
Listen to the Ethanol Report here: Ethanol Report on California LCFS
There were lots of ethanol issues to discuss at the National Association of Farm Broadcasting annual Trade Talk event in Kansas City last week. The topics included the lame duck session of Congress, importance of renewing biofuels tax incentives, doing more to invest in cellulosic ethanol, labeling for E15 at the pump, just to name a few.
Renewable Fuels Association president and CEO Bob Dinneen says it is one of his favorite events of the year. "I think farm broadcasters are doing a lot of hard work trying to make sure that Americans understand the important debates that are going on in DC," Dinneen says. "I love these folks and I love being here."
This edition of "The Ethanol Report" comes from the NAFB meeting and Bob comments on all of these important issues facing the ethanol industry. He says he is optimistic about getting biofuels tax incentives extended. "I think that there's an opportunity to extend the ethanol tax incentive, the Bush tax incentives and also the biodiesel tax credit and other important tax incentives that need to be addressed before the end of this year." RFA joined with several other ethanol and agricultural organizations in writing a letter to Congressional leaders about the need to address extension of the Volumetric Ethanol Excise Tax Credit (VEETC) and the Alternative Fuel Infrastructure Credit, and to broaden the definition of the cellulosic ethanol producer tax credit to include additional feedstocks like algae.
Dinneen spoke at the Cellulosic Biofuels and Biorefineries Summit in Washington, DC today to stress the importance of encouraging investment in cellulosic ethanol. "I'm strongly supportive of a refundable investment tax credit, because you've got to do some innovative things to free up capitol and allow cellulosic ethanol to move forward," he says.
Listen to the Ethanol Report here: "Ethanol
Renewable Fuels Association president and CEO Bob Dinneen says the Environmental Protection Agency is missing an opportunity to reduce America’s dependence on foreign oil and create new economic opportunity by limiting its decision on E15 (15% ethanol/85% gasoline) to only model year (MY) 2007 and newer vehicles.
“EPA’s scientifically unjustified bifurcation of the U.S. car market will do little to move the needle and expand ethanol use today,” said RFA President and CEO Bob Dinneen. “Limiting E15 use to 2007 and newer vehicles only creates confusion for retailers and consumers alike. America’s ethanol producers are hitting an artificial blend wall today. The goals of Congress to reduce our addiction to oil captured in the Renewable Fuels Standard cannot be met with this decision.”
Dinneen is especially concerned about the labels required at the pump that are likely to lead to confusion among consumers and issues with retailers.
Listen to an interview with Dinneen on the decision here. RFA Reacts to EPA Ruling on E15
This edition of “The Ethanol Report” features comments from participants in last week’s Export Exchange held in Chicago to promote exports of the ethanol co-product distillers dried grains with solubles (DDGS). About 500 buyers and sellers of DDGs from the United States and over 30 countries took part in the two day event.
We hear from event sponsors Renewable Fuels Association (RA) President and CEO Bob Dinneen and U.S. Grains Council (USGC) CEO and president Tom Dorr, as well as Rick Tolman with the National Corn Growers Association, ethanol producers Ray Defenbaugh and Walter Wendland, and South Dakota extension swine specialist Dr. Robert Thaler. We have lots more still to post from that event, but this report provides a nice taste of how it went.
Listen to or download the Ethanol Report here: DDGS Ethanol Report