Domestic Fuel

In this edition of “The Ethanol Report,” we hear from Geoff Cooper, Vice President of Research and Analysis for the Renewable Fuels Association, about what is right and what is wrong with the rule for the expanded Renewable Fuel Standard released early last month by the Environmental Protection Agency.

The good news is that the RFS2 improves upon the rule EPA proposed last year, and that it is much better than what California is using to determine lifecycle greenhouse gas emissions. The bad news is the continued reliance on the non-scientific indirect land use change. EPA’s new calculations determined that corn ethanol was better than they first thought when it comes to indirect land use change, so they cut that penalty in half, while they totally eliminated it for sugarcane ethanol – a move that has RFA mystified.

This podcast was recorded at the recent National Ethanol Conference, where RFS2 was the main topic of discussion. We reference a presentation done at the conference by EPA’s Sarah Dunham, which you can find in a previous post here on Domestic Fuel.

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When discussing indirect land use it brings a popular saying to mind: If a tree falls in the forest and no one is around to hear it, does it still make a sound? Only in this situation the saying should be modified as follows: If a tree is cut down in a rainforest in Brazil to sell wood, should corn ethanol’s carbon footprint go up? Anyone with an ounce of commonsense would say no.

And here’s why: when a tree is cut down in Brazil, it is not to plant crops for biofuels, it is to sell the wood because the tree is of greater value as wood, then as part of the rainforest. Only then is the land converted to pasture and then to land for crops like soybeans. Sugarcane is rarely grown in the rainforest and Brazil doesn’t produce biofuels from corn. So what I just can’t seem to wrap my head around is what exactly does that tree have to do with corn ethanol?

So what has caused today’s diatribe on indirect land use? A new paper published this month in Bioscience Magazine titled, “Effects of US Maize Ethanol on Global Land Use and Greenhouse Gas Emissions: Estimating Market-mediated Responses.” The paper was authored by Thomas W. Hertel of Purdue University and five co-authors. In a nutshell, the authors argue that the greenhouse gas emission reductions from corn-based ethanol are canceled out when factoring in the increased carbon output from indirect land use change. Therefore, their contribution to California’s Low Carbon Fuel Standard is negligible, even when compared to conventional petroleum based fuels.

There are so many things wrong with this paper that I had a hard time deciding where to begin.
Read the rest of this post…

Earlier this month, the EPA finally released its new Renewable Fuels Standard, better known as RFS2. It was just in time as both the biodiesel and ethanol industries held their national conferences just days after the announcement, prompting multiple sessions at each gathering to discuss the implications of the new rules.

In this edition of the Domestic Fuel Cast, we hear from National Biodiesel Board Vice Chairman Gary Haer with Renewable Energy Group, who spoke at the National Biodiesel Conference and Expo, and President and CEO of the Renewable Fuels Association, Bob Dinneen, talking from the National Ethanol Conference in Orlando, Florida, and get their thoughts on RFS2.

It’s an interesting conversation, and you can hear more of it below.

You can also subscribe to the DomesticFuel Cast here.

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The U.S. Grains Council is holding its 7th Annual International Marketing Conference and 50th Annual Membership Meeting in Mexico. One of the main purposes of this meeting is for the organization to create a new working plan for the development of U.S. grain exports and a bright spot for corn growers has been the growth in the export of DDGS.

I’m attending the meeting and had a chance to visit with National Corn Growers Association CEO, Rick Tolman, seen here addressing one of the conference meetings. NCGA is a founding member of the U.S. Grains Council.

Rick, who worked for USGC for many years, says that NCGA considers the Grains Council their international trade partner. The two organizations have a very strong working relationship. He says one of the things he’s really happy to hear discussed here at this meeting is how well exports of DDGS have been due to the efforts of the Grains Council. That’s good news for corn growers for whom the production of ethanol is so important right now. He says that the Grains Council is looking at other value added products they can promote for export too.

Since Rick is here instead of attending the National Ethanol Conference which gets underway today I asked him what’s going on in the ethanol industry from a corn growers perspective. He says there is a whole list of challenges and opportunities for ethanol. He says that with the final rule making on the RFS-2 it has improved the regulations but also created some challenges. It has given more optimism for growth of the business he says but the EPA is still giving a big penalty to ethanol for indirect land use change. He says it’s “tying an anvil around the ankle of the industry and trying to move forward and compete.” NCGA will continue to work with EPA to remove the unfair part of the new rules.

By the way, Cindy is attending the National Ethanol Conference so you’ll be seeing her coverage here on Domestic Fuel once the meeting gets going. The opening general session will be tomorrow morning.

You can listen to my interview with Rick here:

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It’s been a long time in the making, but the Environmental Protection Agency has finally released the new Renewable Fuels Standard … better known as RFS-2.

The standard requires that biofuels will have to reduce greenhouse gas emissions compared to the gasoline and diesel fuels they displace and grow in production from last year’s 11.1 billion gallons to 36 billion by 2022, with 21 billion gallons to come from advanced biofuels. It’s expected to replace more than 328 million barrels of non-renewable petroleum a year and reduce greenhouse gas emissions more than 138 million metric tons annually when fully implemented.

While admitting it might not be perfect, RFS-2 is being welcomed by representatives of the ethanol and biodiesel industries.

In this edition of the Domestic Fuel Cast, we’ll here from EPA Administrator Lisa Jackson, Secretary of Agriculture Tom Vilsack, as well as Tom Buis with Growth Energy, the Renewable Fuels Association’s Matt Hartwig, and the National Biodiesel Board’s Michael Frohlich.

They all have interesting takes on what the new standard will bring in the short and long terms, and you can here what they have to say here:

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The American Farm Bureau Federation (AFBF) is pleased with a decision by Senate leadership last week to delay consideration of climate change legislation until the spring of 2010.

During a recent interview before the delay was announced, AFBF president Bob Stallman said the agricultural organization opposed the climate change bill that was passed by the House, despite provisions included that were beneficial to agriculture. “That bill we believe will downsize American agriculture by at least 20 percent,” he said. “Long term it reduces our ability to produce food.”

Stallman says that AFBF is also opposed to the controversial concept of indirect land use change to determine the lifecycle greenhouse gas emissions of biofuels. “That issue is an attempt by the environmental community to remove the use of corn ethanol from the Renewable Fuel Standard,” Stallman said. “We’re opposed to that. Number one, there is no science, it’s pure speculation. And how you can say that an acre producing corn ethanol here is going to change a specific acre in a specific country is nonsense.”

Listen to an interview with Stallman here.

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A global biofuels organization is urging world leaders to recognize the environmental benefits of renewable fuels like ethanol and biodiesel.

The Global Renewable Fuels Alliance (GRFA) is calling on delegates to the United Nations Framework Convention on Climate Change Conference in Copenhagen December 7-18 “to seize the historic opportunity to recognize the environmental importance of biofuels and begin to develop strategies to ensure that biofuels play an even greater role in meeting global climate change objectives.”

GRFA released an position paper this week summarizing greenhouse gas (GHG) reduction strategies in the transportation sector that take advantage of the verifiable emission reductions available from biofuels. “With transportation responsible for 25% of the world’s GHG emissions and rising, it is critical that biofuels form the core of any future mitigation strategy in this important sector,“ said GRFA spokesman Bliss Baker. “Adopting sustainable biofuels programs can deliver real GHG reductions while reducing a crippling reliance on imported fossil fuels for many developing nations.”

GRFA outlines several actions to be recommended at the conference, including the adoption by governments of biofuels-friendly policies in the transport sector, and that policies take into account the increasing efficiency of global biofuels production in developing policies as opposed to relying on out-of-date data and outdated arguments. They also urge all governments to base an indirect land use change (ILUC) policy on transparent and unequivocal scientific evidence only.

GRFA also continues to call on the World Bank, the United Nations and other international bodies to increase investment in the agricultural sector of developing nations and to support expanded biofuels production in these regions.

Read the GRFA position paper here.

The Science magazine article that was published last week and co-authored by Tim Searchinger, a lawyer, has added another level of controversy to the indirect land use change (ILUC) debate. The article suggested the land use effects of fuel produced from various forms of biomass were miscalculated, in part, because they cause deforestation around the world as land is cleared to grow so called “energy crops”. EPA has yet to rule on RFS2 (they are unsure of how to incorporate ILUC) and discussion on how to regulate bio-electricity has barely begun.

Novozymes is one of the dozens of companies speaking out against the article and its conclusions. Suggestions that the increased use of fuel produced from biomass will automatically lead to increased deforestation globally ignores existing science, continued technological advances, and numerous international policies and principles under development to regulate biofuels, say experts at Novozymes.

“We need to make smart energy choices that support a low-carbon energy future,” said Adam Monroe, president of Novozymes North America. “Jumping to quick conclusions about deforestation may ruin one of our best chances for addressing climate change and establishing a sustainable, secure energy supply.”

Because of the potential value that biofuels have as part of a low-carbon society, dozens of scientists have challenged the credibility of economic models used to estimate the values of GHG emissions projected from ILUC.

“Clearly, the direct and indirect environmental impacts of the world’s energy supply need further study, but there needs to be a level playing field to ensure that biofuels, bioelectricity and, most importantly, fossil fuels are all judged by the same criteria when measuring emissions. There should be a full accounting of the carbon emissions of all fuels, not just biofuels,” said Monroe.

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.”

Last week, we told you new research shows how green biodiesel is. I finally got a chance to catch up with National Biodiesel Board CEO Joe Jobe to talk a little bit about this important study… and what it will mean as the Environmental Protection Agency considers a new Renewable Fuels Standard, RFS-2.

In this edition of the Domestic Fuel Cast, you’ll hear how Jobe believes the information that biodiesel now produces 4.5 units of energy for every unit of energy spent on it will prove to the EPA and skeptics that biodiesel is truly one of the greenest fuels out there. He says the information couldn’t come at a better time and was included with the NBB’s comments about the RFS-2.

Jobe adds that the NBB will be showing off biodiesel’s green, sustainable nature with a Greenfest in the board’s hometown of Jefferson, Missouri at Riverside/Ellis Porter Park this Thursday evening, October 22nd from 4-8. He says Jefferson City boasts several users of biodiesel, including the Missouri Department of Transportation, which uses a blend of 20 percent biodiesel (B20) in all of its diesel vehicles. Plus, the city itself burns B20 in its city buses. Fire trucks, ambulances, and hybrid and flex-fuel vehicles will also be on hand for the JC Greenfest, as well as demonstrations from Linn State Technical College and Lincoln University. They’ll even have live music from national recording artist Emily Richards

To hear more of my conversation with Jobe, listen to the latest DF Cast here:

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You can also subscribe to the DomesticFuel Cast here.