Domestic Fuel

The Governor’s Biofuels Coalition met in Sioux Falls Wednesday and sent a letter to members of Congress in support of the Renewable Fuels Standard.

The letter from the 30 governors represented by the Coalition, led by Iowa Governor Terry Branstad, urges Congress to stay the course on the RFS. “As governors who see firsthand the impact that the RFS has had on our states, we urge you to reject any modifications to the RFS,” the letter reads. “By intentionally using misinformation, biofuels opponents damage the nation’s economy, environment, and energy security.”

The governors’ meeting was held at the headquarters of POET and CEO Jeff Lautt says Governor Branstad is a strong defender of biofuels. “He’s seen first hand the success of what this industry’s done for America on the energy side but also what it’s done on the ag side,” said Lautt.

The Iowa Biodiesel Board and Iowa Renewable Fuels Association both praised their governor’s leadership and appreciate the strong stand taken by the coalition to support the RFS.

The Governors’ Biofuels Coalition (GBC) is holding its annual meeting this week in Sioux Falls, South Dakota at the headquarters of ethanol production company POET.

Iowa Governor Terry Branstad, GBC chairman, and South Dakota Governor Dennis Daugaard, a GBC member, will be leading a discussion of the accomplishments of the federal Renewable Fuels Standard (RFS). Governor Branstad was one of the founders of the coalition and instrumental in the passage of the RFS. The meeting will also include presentations on innovative pubic-private partnerships to expand retail infrastructure and spur economic development, the use of biofuels to cost effectively meet clean air requirements, gasoline quality, and opening markets for cellulosic and advanced biofuels.

The Governors’ Biofuels Coalition was started in 1991 as the Governors’ Ethanol Coalition. Membership now includes representatives from 36 states and eight countries.

Biodiesel production in the U.S. nearly doubled in January, jumping a whopping 86 percent compared to December’s output. According to this article from Platts.com, quoting the U.S. Environmental Protection Agency’s Moderated Transaction System, the industry got the boost from the renewal of the $1-a-gallon biodiesel tax credit:

After reaching its lowest output level of 2012 in December and falling for five of the last six months of the year, the January production numbers were boosted by the January 2 return of the $1/gal biodiesel blending tax credit, alongside a 10 cents/gal credit for agricultural biodiesel producers.

“Tax credit galore,” one producer source at a major Midwest biodiesel production facility said. “The production numbers show we are well ahead of the 2013 obligation. I would hope that continued production numbers can provide evidence to the EPA to increase the obligation in years to come.”

The article goes on to point out that January’s nearly 121 million gallon biodiesel production puts the country well on pace to meet the 2013 Renewable Fuels Standard-2 production target of 1.28 billion gallons.

President Obama has announced his picks for Secretary of Energy and Environmental Protection Agency administrator. The President nominated MIT professor Ernest Moniz as energy secretary and EPA official Gina McCarthy as administrator for the agency.

Renewable Fuels Association president Bob Dinneen welcomed the nomination of McCarthy as a solid choice and is interested in getting to know Moniz. “(McCarthy) is knowledgeable, willing to listen, and straight-forward. She knows the EPA inside and out and has typically approached challenges with a common-sense determination to resolve them in a timely manner,” said Dinneen. “(We) look forward to meeting with Secretary-designee Moniz to update him on the state of the U.S. ethanol industry, our track record of success in fostering greater energy independence, and the exciting results of ongoing investment in next generation biofuels.”

Growth Energy CEO Tom Buis added that “McCarty has been a strong supporter of biofuels and we look forward to working with her to bring sustainable, clean, homegrown American fuels to the consumer.” Brooke Coleman, Executive Director of the Advanced Ethanol Council (AEC), said McCarthy is “the perfect choice” because she has been “very engaged on the development of the cellulosic biofuels industry and the administration of the Renewable Fuel Standard (RFS).”

Back in 2009, McCarthy was one of two high-ranking EPA officials to visit farm operations and biofuel facilities in Iowa, including Renewable Energy Group‘s (REG) Central Iowa Energy biodiesel plant in Newton.

The House Committee on Science, Space and Technology Subcommittee on the Environment will hold a hearing tomorrow on mid-level ethanol blends, but without any input from the ethanol industry. Witnesses scheduled to testify include representatives from AAA, motorcyclists and a research council that works for the petroleum industry and auto makers.

Growth Energy CEO Tom Buis CEO of Growth Energy says the committee regularly holds biased hearings on ethanol. “It seems to me that if the Science Committee continues to hold these one-sided, sham hearings, they out to change their name to the Science Fiction Committee – because that is exactly how their treatment of ethanol and biofuels have been,” said Buis. “By only inviting vocal critics to discuss mid-level ethanol blends and refusing to invite a single producer or stakeholder in the ethanol industry to testify exemplifies a colossal waste of time and taxpayer money.”

“It both saddens and angers me that in this day and age such a lopsided, stacked hearing could actually happen,” said Renewable Fuels Association president and CEO Bob Dinneen, who submitted a letter to protest the one-sided nature of the witness list as well as note the extensive testing of E15 and the benefits of the blend.

Ethanol organizations have submitted written testimony for the hearing which will begin at 2:00 pm Eastern time on Tuesday.

Oil companies and food manufacturers are taking their lawsuit seeking to ban 15% ethanol (E15) fuel to the U.S. Supreme Court.

Lower courts have already rejected the attempt by the American Petroleum Institute (API) and the Grocery Manufacturers Association (GMA) to reverse the Environmental Protection Agency (EPA) decision allowing E15 in the marketplace as a consumer choice for vehicles newer than 2001.

“We now know why gas prices keep going up and up – to fund unnecessary Big Oil lawsuits to protect their monopoly on the fuel market,” said Renewable Fuels Association president and CEO Bob Dinneen. “I wonder if food prices will spike as well to cover the cost of this Supreme Court challenge?”

“There is nothing unexpected in this announcement; in fact it is not even news. We know that the oil companies are going to do everything within their power to restrict access of a price competitive product,” said Growth Energy CEO Tom Buis.

“Big Oily Foods’ cozy and self-serving relationship to do whatever it takes to stop consumers from access to safe and affordable E15 fuel is dripping with highly-saturated desperation,” added Brian Jennings, executive director of the American Coalition for Ethanol (ACE). ““With gasoline prices on the rise for 35 days in a row, American-made E15 will help drivers save money at the pump.”

Iowa Renewable Fuels Association (IRFA) Executive Director Monte Shaw notes that if the lawsuit were successful, federal law would mandate that Americans buy only fuel containing a minimum of 90 percent petroleum. “Big Oil has made clear that nothing will stand in the way of its quest to protect the federal petroleum mandate and use government regulations to shield itself from market competition,” said Shaw.

The additional legal challenge comes on top of legislation introduced last week that would block continued commercial sales of E15.

Eight term Iowa congressman Leonard Boswell is continuing to support renewable fuels in his state despite losing his re-election bid in re-districting last year to Tom Latham.

Boswell attended the Iowa Renewable Fuels Summit last month because it is something he says he cares deeply about. “I am so wound up in things like renewable fuels, it’s just one of my passions,” he said during an interview at the summit. “I will participate somehow.”

The former Democratic congressman, who is a farmer, was disappointed that Congress was unable to get a farm bill passed last year. “We need a farm bill, you can’t plan if you don’t know the rules,” said Boswell, who believes the House did have the votes to pass the bill that came out of the agriculture committee but they were never given the chance.

Listen to interview with Boswell here: Former Congressman Leonard Boswell

IRFA Renewable Fuels Summit Photo Album

Citing a need for increasing jobs and combating climate change, President Obama pledged to do more to “speed the transition to more sustainable sources of energy” during his 2013 State of the Union address.

Four years ago, other countries dominated the clean energy market and the jobs that came with it. And we’ve begun to change that. Last year, wind energy added nearly half of all new power capacity in America. So let’s generate even more. Solar energy gets cheaper by the year — let’s drive down costs even further. As long as countries like China keep going all in on clean energy, so must we.

Now, in the meantime, the natural gas boom has led to cleaner power and greater energy independence. We need to encourage that. And that’s why my administration will keep cutting red tape and speeding up new oil and gas permits. That’s got to be part of an all-of-the-above plan. But I also want to work with this Congress to encourage the research and technology that helps natural gas burn even cleaner and protects our air and our water.

Although there was no mention of biofuels in the speech, both ethanol and biodiesel organizations issued statements stressing their importance for the nation in achieving the president’s goals. “Biofuels can provide the eco-boost the U.S. economy needs,” said Renewable Fuels Association president and CEO Bob Dinneen. ““I am pleased that President Obama will continue to pursue policies that increase the use of cleaner, renewable energy, which is better for our environment and the air we breathe,” Growth Energy CEO Tom Buis said. Anne Steckel, vice president of federal affairs at the National Biodiesel Board, added that the biodiesel industry is poised to play a growing role in cutting greenhouse gas emissions. “Biodiesel is a practical, cost-effective and bipartisan solution that’s here today to address this problem,” Steckel said.

Concerns over hurting the soil quality when harvesting some crop residues for cellulosic biofuels, instead of leaving the residues on the fields to help the soil quality, might be unfounded. U.S. Department of Agriculture (USDA) research says that soil quality would not decline if post-harvest corn cobs were removed from the field.

“Crop residues have many useful functions when left in the field, [including] protecting against water and wind erosion [and] may contain essential nutrients for crop growth that can be recycled back into the soil,” among others says Agricultural Research Service (ARS) soil scientist Brian Wienhold, who conducted the study. But his work compared runoff rates and sediment loss from no-till corn fields where postharvest crop residues were either removed or retained and found no significant difference between fields’ sediment loss rates with and without the cobs. The cobs did slightly delay field runoff.

The study concluded that cobs could be removed from other residue and used for bioenergy feedstock without significantly interfering with the role of crop residues in protecting soils. But Wienhold cautions that you need to make sure you balance taking any residue off the fields with the potential benefits and losses it could cause.

Listen to Wienhold’s comments to USDA here: ARS soil scientist Brian Wienhold

Probably no one in the country was more pleased to see the renewal of the wind energy production tax credit than the folks in Iowa, a place that has become a real leader nationwide in wind energy. During the recent Iowa Wind Energy Day, officials and advocates for wind energy expressed their appreciation for the extension… and the hope that it could become more permanent to give more stability to the green industry.

In this edition of the Domestic Fuel Cast, we hear from Iowa Gov. Terry Branstad, President of the Board for the Iowa Wind Energy Association Kathy Law and Executive Director of Iowa Wind Energy Association Harold Prior as they talk about what wind power has meant to their state and what potential it holds for the entire country… especially the rural areas.

You can listen to the Domestic Fuel Cast here: Domestic Fuel Cast - Wind Energy PTC Passes

You can also subscribe to the DomesticFuel Cast here.

And check out Joanna’s 2013 Iowa Wind Energy Day Photo Album.

As the ethanol industry awaits what the U.S. Environmental Protection Agency (EPA) will release for targets for this year’s Renewable Fuels Standard, members of the Biotechnology Industry Organization (BIO) and Fuels America expressed their support for the green fuel.

BIO‘s Executive Vice President, Brent Erickson, said today in a news conference that they are expecting EPA’s release of the 2013 renewable volume obligations, very soon, calling them “vitally important to companies commercializing advanced biofuels,” and this is expected to be a pivotal year for cellulosic and advanced biofuels.

“Stability in the RFS is crucial to investment [in the advanced biofuels sector],” Erickson explained, adding that “competing industries” would like to preserve their long-standing choke-hold on the fuel market in this country. “While other industry groups are spending large amounts of money to undermine or destabilize the RFS, it’s time for Congress to reaffirm its commitments to this successful policy.”

Christopher G. Standlee, Executive Vice President, Abengoa Bioenergy, said that the road to commercialization of any new technology is not short or inexpensive, but the RFS “provides a roadmap to increased energy independence and national security, with a long-term vision for the U.S. fuel industry through 2022.” He also highlighted Abengoa’s efforts in the Midwest to be on the leading edge of the new technology, citing its 25 million gallon cellulosic ethanol plant in Kansas under construction and expected to be running by the end of the year.

Others on the news conference called the RFS a bold, aggressive vision, with Wade Robey, a board member of POET-DSM Advanced Biofuels, saying Congress took the leap of faith without having the commercialization of cellulosic ethanol in place when it was passed. “It is clear [the EPA's] volume targets have been optimistic; however, it is that optimism that has spurred many projects to be under construction and coming online soon across the United States. It has sped the development of this clean, domestic energy source,” prompting even foreign investors to jump into U.S. production, Robey said.

Jan Koninckx, Global Business Director for Biorefineries, DuPont Industrial Biosciences, said America is now leading the world in renewable fuels because of the RFS. And he warns that abandoning this successful policy is not the way to go. “When we listen to those who want to repeal the RFS, what we hear is essentially an industry organization that wants the United States to turn its back on new technology … and keep the [U.S.] dependent on a 20th century technology. Turning our backs on innovation is certainly not in the tradition of the U.S. or the company that I am with.”

Listen to all of their opening remarks here: BIO/Fuels America News Conference

Secretary of Agriculture Tom Vilsack says the future success of biofuels in this country is also tied to successfully getting a new five-year farm bill passed. Speaking to delegates of the American Farm Bureau Federation at their annual meeting in Nashville, Tenn., Vilsack expressed his disappointment that a new farm bill was not passed … reserving some of his stronger language for maybe a smaller gathering. But he says the impacts of a new farm bill will be on more than just the mainstream renewable fuels, ethanol and biodiesel. It is for the overall bio-based economy.

“I’ve seen the ability to use corncobs and switch grass and algae and a wide variety of things that are grown and raised or could be produced in rural areas, converted into plastics, into chemicals, into fabrics, into fibers, into fuel, into energy. It is an unlimited future. But we require support and assistance and help and a commitment through a five-year bill,” Vilsack explained.

Vilsack reminded his audience who knows full well that rural America is providing the feed stock for most of the energy and most of the fuel that’s consumed and used across the country, while providing millions of jobs, many of those in the renewable energy sector. And he said that rural economy, booming with renewable energy, will attract young folks back to the heartland.

“If I were talking to a young person, I would say, you’re concerned about our overreliance on foreign oil, you can solve that problem in rural America.”

Vilsack also announced that he plans to serve another term as Secretary of Agriculture … a move applauded by Tom Buis, CEO of Growth Energy:

“Secretary Vilsack has been a tireless advocate for the renewable fuels industry, and I commend President Obama for his reappointment to the Department of Agriculture. I am confident that Secretary Vilsack will build upon his excellent service record supporting renewable fuels and economic growth across rural America. I know that during his tenure he will continue his strong advocacy for biofuels increased market access for higher ethanol blends such as E15.

You can listen to or download Sec. Vilsack’s speech here: Sec. Vilsack Speech

And his press conference after the closing session here: Sec. Vilsack Press Conference

The American Taxpayer Relief Act of 2012 passed by Congress on New Year’s Day includes the extension of three key ethanol related tax credits, which starts the new year off well for the ethanol industry.

“The one year extension of the cellulosic producer tax credit and accelerated depreciation provides some measure of certainty to ensure that 2013 will be a year of growth and milestones for the advanced ethanol industry,” said Bob Dinneen, President and CEO of the Renewable Fuels Association. “In addition, and equally significant, is the extension of the alternative fuel infrastructure tax credit which will accelerate E15’s entry into the marketplace this coming year.”

Dinneen says it would be better that the alternative energy provisions were extended for 5-7 years instead of just one, but it is certainly understandable. “Folks do understand that is all that was on the table and really it’s teeing up a longer conversation about what to do with our tax code,” he said. “We want to have that conversation because we want all energy tax incentives on the table” including those benefiting the oil industry.

In this edition of the Ethanol Report, Dinneen talks about the dysfunctional 112th Congress and his optimism that the 113th Congress will be better.

Listen to or download the Ethanol Report here: Ethanol Report on Congress in 2013

Subscribe to “The Ethanol Report” with this link.

Agriculture Secretary Tom Vilsack has had a good working relationship with EPA Administrator Lisa Jackson on various issues important to farmers, ranchers and renewable energy and he is sorry to hear about her resignation from the Obama cabinet.

“Lisa Jackson has served our country well as she balanced improving the environment and the health of the American people – while ensuring our country’s economic competitiveness – because they are intrinsically linked,” said Vilsack in a statement today. “Throughout her tenure, she listened to stakeholders, including farmers and ranchers, and took their concerns into account while considering policies that impacted rural America. She was a friend to me and to those who live and work in rural America and her leadership will be missed.”

Vilsack and Jackson met with representatives of the ethanol industry and toured Renewable Energy Group (REG) biodiesel plant in Newton, Iowa last year. Jackson was instrumental in deciding in favor of a waiver allowing the use of 15% ethanol and against a waiver of the Renewable Fuel Standard requested this year.

The U.S. Senate repeal of a second provision in the military’s budget that would have blocked the developing the use biofuel alternatives is being welcomed by biofuel makers. Yesterday, The Senate voted 62-37 to pass an amendment by Senator Mark Udall (D-CO) repealing section 313 of the FY2013 National Defense Authorization Act (NDAA), which prohibited DOD from procuring alternative fuels if they cost more than their conventional counterparts. Today, they passed Senator Kay Hagan’s (D-NC) amendment to repeal section 2823 of the NDAA that prohibited defense officials from entering into a contract to plan, design, refurbish or build a biofuels plant or any facility used to refine biofuels unless it is specifically authorized by law. This amendment passed by a vote of 54-41.

Growth Energy CEO Tom Buis applauded the move:

“Today’s successful passage of Senator Hagan’s amendment is yet another example of the strong bipartisan support in the U.S. Senate for American made renewable energy. This is the second successful vote in two days supporting renewable fuels and the message lawmakers are sending is clear – biofuels play a critical role in developing a diversified energy portfolio to meet our growing energy needs and increase our energy independence.

Mike Breen, Executive Director of the Truman Project and spokesman for its clean energy campaign, Operation Free, was also pleased to see Hagan’s (D-NC) amendment pass.

“Today’s vote was a victory for our military’s energy security, helping ensure that we develop technology to diversify the fuels that power our military’s vehicles, ships, and aircraft…

The DoD has a long history of encouraging private-public partnerships that result in new opportunities for civilian industries. Advanced biofuels can be the next success story.”

Bob Dinneen, the President and CEO of the Renewable Fuels Association (RFA), added his congratulations to the Senate for repealing both measures in the defense spending bill:

“We now have two examples in two days of the strength and momentum behind renewable fuels. Americans believe in biofuels and see a future that is strong, bright and energy independent.”

A similar provision is also making its way through the House’s version of the defense spending bill.