Third Way Report Links First and Second-Generation Ethanol

A recently released report from Third Way titled, “Cellulosic Ethanol is Getting a Big Boost from Corn, for Now,” highlighted the connection between first and second-generation ethanol, and the vital need for continued implementation of the Renewable Fuel Standard(RFS) as set by Congress.

The report stated that “a number of proposed changes to the RFS, however innocuous they may seem, would remove any incentive for the first generation industry to continue supporting cellulosic ethanol. At this critical stage in their development, cellulosic fuels can hardly afford to lose the closest friend they have.”

The report continued, “While proposals to gut only the corn section of the RFS may not be intended to endanger the development of cellulosic ethanol, this is exactly what would occur,” the report found. “Given the nuances of current fuel markets and how they interact with the RFS, these proposals will discourage cellulosic ethanol investment by companies with a large stake in corn ethanol — the very companies that are helping to commercialize this long-sought fuel.”

“Replacing corn ethanol with cellulosic may sound like the perfect outcome to some supporters of corn-gutting policies. In practice, however, this approach is highly unlikely to produce the desired results,” the report added. “By disengaging first generation industry from the effort, it greatly reduces the odds of achieving substantial cellulosic ethanol production, especially in the near term. And without large quantities of cellulosic ethanol to serve as a substitute, current levels of corn ethanol will still be produced in order to meet the oxygenate needs of the gasoline supply.”

“This report confirms what the biofuels industry has been saying for some time now – that you cannot have cellulosic ethanol without the continued production and support of grain-based ethanol,” stated Growth Energy CEO Tom Buis. “The two are tied together and first-generation ethanol production is the true building block for the next generation of fuels.”

To view the full report, please click here.

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