GREEN Team Newsletter - Issue #218
Iowa Experience Proves EPA Should Enforce the RFS as Congress Intended
July 25, 2016The Iowa Renewable Fuels Association (IRFA) recently submitted comments on the proposed Renewable Fuel Standard (RFS) volumes, urging the Environmental Protection Agency (EPA) to enforce the law as Congress intended and set the final targets at 15 billion gallons for corn-based ethanol in 2017 and at least 2.5 billion gallons for biomass-based diesel in 2018.
“The current RFS proposal simply doesn’t go far enough in advancing the use of homegrown, cleaner-burning renewable fuels,” stated IRFA Executive Director Monte Shaw. “From feedstocks and production capabilities to consumer use and marketplace trends, every data point demonstrates that the EPA should increase the proposed volumes and finalize corn-based ethanol levels at 15 billion gallons for 2017 and biomass-based diesel levels at 2.5 billion gallons for 2018.”
Discussing corn-based ethanol in its comments to the EPA, the IRFA stated, “The only physical barrier to greater use of renewable fuels is the inability of the average motorist to pull up to a fuel pump and choose from a variety of fuel options.
“This restriction on competition is not the result of consumer preference, equipment availability or renewable fuels supply. Iowa retailers have had great success with higher ethanol blends like E15 and E85, when they are allowed to sell it. Customer demand is high. Contrary to the blatantly false claims that a ‘blend wall’ exists, even more motorists would buy E15 and E85 if it were just available for them to choose.”
In fact, Iowa data shows retailers that offer a range of ethanol blended fueling options through blender pumps are already meeting the full 2022 RFS levels today, often meeting or exceeding the 18 to 19 percent renewable content targets for gasoline sales.
Switching to biodiesel, the IRFA commented, “Biodiesel has been an unmitigated success under the RFS… In fact, the U.S. is expected to use about 2.5 billion gallons of biomass-based diesel in 2016 – 400 million gallons more than the number EPA proposes to set for 2018—two years from now. Finalizing the proposed level would simply memorialize the status quo while nearly 60 percent of U.S. biodiesel industry capacity sits idle.
“Through May of 2016, roughly 30 percent of the biodiesel market was imports, and the number continues to grow… Congress gave the EPA the authority to set the biodiesel level to ensure growth for this widely-successful advanced biofuel. Factoring in imports, the proposed level does not achieve this goal.”
Discussing Iowa-specific data, the IRFA commented, “In 2010, the average blend level of biodiesel-blended gallons sold in Iowa was 3.1 percent. By 2015, the average biodiesel blend level in Iowa had more than tripled to 11.0 percent—a level that simply could not have been reached without selling a significant amount of not just B11, but B15 and B20 as well.”
The IRFA concluded, “The bottom line remains clear: there is no legal, marketplace or consumer rationale for reducing the conventional biofuels level below the statutory requirements.
“We urge the Obama Administration to reembrace the goals of the RFS that President Obama voted for in 2007, to level the playing field against 100 years of oil subsidies. We urge the Obama Administration to reexamine its support and aspirations for the RFS voiced back in 2008. And we urge the Obama Administration to set RFS levels—in this, its final opportunity—that recommit the RFS to pushing for more competition, more energy security, more jobs and a cleaner environment.”
To read IRFA’s full comments, please click here.
In May, the EPA proposed capping the corn-based ethanol portion of the RFS at 14.8 billion gallons for 2017, below levels prescribed by Congress under the Energy Independence and Security Act of 2007. Also included was the biomass-based diesel level for 2018, proposed at just 2.1 billion gallons. To view the EPA’s full proposal, please click here.
Grassley, 13 Others Introduce Biodiesel Tax Incentive Extension
July 25, 2016Senator Chuck Grassley (R-Iowa) and 13 other co-sponsors, including Sen. Joni Ernst (R-Iowa), recently introduced a bill that would modify the $1.00 per gallon biodiesel blenders’ tax credit to a producers’ credit and extend it for three years.
“We applaud Sen. Grassley for leading the charge, and his colleagues, like Sen. Joni Ernst, for working on this common sense modification and extension that will support American jobs and energy security,” stated Iowa Renewable Fuels Association (IRFA) Executive Director Monte Shaw. “The latest Energy Information Administration estimates show U.S. biodiesel production could actually take a step backwards this year. This is due to the latest Department of Commerce numbers showing biodiesel imports are surging, reaching a two-and-a-half-year high in May and currently making up about one-third of the U.S. biodiesel market. These soaring imports, coupled with the EPA’s lackluster Renewable Fuel Standard proposal, demonstrate the need to modify the credit to a domestic producers’ incentive and provide some longer-term certainty for the U.S. biodiesel industry.”
After being reinstated in late 2015, the federal biodiesel tax incentive is set to expire again on December 31, 2016.
“Biodiesel and renewable diesel producers around the country are yet again facing what effectively amounts to a tax increase in less than six months. Congress can keep that from happening by passing this bill,” stated National Biodiesel Board (NBB) Vice President of Federal Affairs Anne Steckel. “It will give producers the certainty they need to hire and grow in the coming years. It will continue our success in diversifying the diesel market and reducing our dependence on petroleum. And it will help clean the air by cutting carbon emissions and other pollution.”
Steckel added, “It also will appropriately reform this incentive by applying it only to domestic biodiesel production, ending a growing practice where foreign producers are taking advantage of our tax system. Our tax law should not be incentivizing foreign fuel, and this bill fixes that loophole so that we’re stimulating jobs and economic development here at home.”
Iowa Ethanol Plants Consistently Gaining Efficiencies
July 25, 2016As reported by the Iowa Farm Bureau, while political battles over the Renewable Fuel Standard (RFS) continue to grab headlines, Iowa’s ethanol plants are quietly pushing ahead and becoming more and more efficient.
The incremental gains by Iowa ethanol plants have been consistent and have helped farmers and all of Iowa by creating additional jobs in rural areas and contributing to the local tax base, said Monte Shaw, executive director of the Iowa Renewable Fuels Association (IRFA).
“It’s not like a grand slam that you hear a lot about. But it’s a lot of singles that add up and make a major difference,” Shaw said about the efficiency gains. “It’s really like putting up three new 100,000 plants a year, without adding any steel.”
Added to that, Shaw said, farmers are continually become more efficient at growing corn and corn stover that is used by ethanol plants to make fuel.
Those efficiency gains were documented earlier this year in a U.S. Department of Agriculture (USDA) report on efficiency gains in the country’s ethanol industry. The ethanol industry, the USDA report said, “has made the transition from an energy sink, to a moderate net energy gain in the 1990s, to a substantial net energy gain in the present.”
The report, authored by Iowa State University economist Paul Gallagher and others, showed that the entire U.S. ethanol industry had steadily improved its efficiency since the mid-1990s. Now, an average ethanol plant produces more than twice the energy than it consumes.
But many Iowa plants, especially those in the western half of the state, are well above average. They have doubled that efficiency by producing four times the energy they consumed, the report found. These plants were at the top of the efficiency chart because they are close to ample corn supplies and livestock feeding operations, so it is efficient to market distillers grains for feed. The plants also have access to transportation infrastructure and end markets, especially along the I-35 and I-29 corridors.
To read the entire Iowa Farm Bureau story, please click here.
Forty Senators Call for Higher Biodiesel Target in RFS
July 25, 2016Forty U.S. Senators from across the country recently called on the Environmental Protection Agency (EPA) to strengthen biodiesel volumes in the pending Renewable Fuel Standard (RFS) proposal.
The senators emphasized that biodiesel and renewable diesel are leading the way in delivering Advanced Biofuels under the RFS and said the EPA should do more to encourage their growth.
“The biodiesel industry has met RFS criteria for growth, exceeding the goals that Congress envisioned when it created the RFS with bipartisan support in 2005 and supporting over 47,000 jobs,” the letter states. “To date, biodiesel and renewable diesel have delivered the majority of the advanced biofuels under the RFS. We believe it is clear that these fuels offer the best opportunity for growth in the near future.”
The letter, which can be found here, was signed by 40 Senators, including both Sen. Joni Ernst and Sen. Chuck Grassley of Iowa.
“I think this letter reflects a growing consensus on Capitol Hill that biodiesel and renewable diesel are successfully delivering the economic and environmental benefits that Congress had in mind when it created the RFS,” said National Biodiesel Board (NBB) Vice President of Federal Affairs Anne Steckel. “This is a success story, and hopefully this letter helps show the Obama administration and the EPA that we need to do more. We need to embrace growth in our cleanest fuels, and the EPA proposal as it stands falls short of that.”
“On behalf of biodiesel producers around the country we want to thank all the senators who signed this letter, particularly Sens. Blunt, Murray, Grassley and Heitkamp for their leadership in organizing the effort,” Steckel added.
ACE Conference to Highlight Growing Retailer Interest in Ethanol Blends
July 25, 2016The list of retailers offering ethanol blends continues to grow, and the upcoming American Coalition for Ethanol (ACE) Conference in Minneapolis, MN August 8-10 plans to focus on the developing marketplace for ethanol.
ACE Senior Vice President Ron Lamberty says the discussions come at a perfect time for curious retailers.
“A number of retail chains across the country have recently added ethanol blends to their fuel offerings, and at the conference, you are going to hear firsthand from some of the people behind the moves and we promised market analysis from some of the sharpest minds in the fuel industry,” said Lamberty.
Three sessions in particular will be of huge interest for retailers said Lamberty.
- Market Outlook Keynote – Tom Kloza, OPIS
Tom Kloza of OPIS offers insightful analysis for ethanol, oil, and other energy markets laced with good-natured humor. You won’t want to miss this presentation.
- Panel Discussion: Octane’s Value Proposition and Regulatory Path Forward
This panel, featuring Dave Hackett of Stillwater & Associates and Kristy Moore of KMoore Consulting, will cover how refiners calculate for the octane value of ethanol and what adjustments they make at the refinery to accommodate a higher octane fuel, as well as the federal regulatory pathways that must be navigated to eventually get a higher octane fuel approved.
- Progress at the Pump: A Conversation with Leading Retailers on E15 and Flex Fuels
Fuel retailers around the country are making the switch to E15 and flex fuels; find out what went into the decision to add those ethanol blends and what hurdles have to be cleared before E15 and Flex Fuels are available nationwide. This session will feature Mike Lewis of Pearson Fuels, Mike Lorenz of Sheetz, Inc. and others.
For more on the ACE Conference, please click here.
Bipartisan House Members Call for Robust RFS
July 25, 2016A bipartisan group of representatives from the Congressional Biofuels Caucus, including Reps. Dave Loebsack, Steve King, Rod Blum and David Young, recently sent a letter to Environmental Protection Agency (EPA) Administrator Gina McCarthy, urging the EPA to finalize blending targets under the Renewable Fuel Standard (RFS) that will expand the production of renewable fuels and offer consumers a choice at the pump. The letter highlighted the success, progress and growth of the renewable fuel industry since Congress adopted the RFS in 2005.
“We thank the lawmakers for their leadership to ensure EPA finalizes a strong RFS that gets the program back on track,” stated Renewable Fuels Association (RFA) President and CEO Bob Dinneen. “As the House members wrote, ‘a final rule that falls short of the conventional biofuel cap will do nothing to assuage critics of the program, while missing an opportunity to refocus on addressing the pressing issues needed to fully realize the potential renewable fuels can make for our economy and energy security.’ We couldn’t agree more,” he said. “As we outlined in comments to EPA this week on its proposed 2017 RFS rule, there’s no justification for lowering the conventional biofuel target. Record levels of E10 consumption, broader availability of E15 and E85, more than 2 billion surplus renewable identification numbers and other factors make the statutory requirement readily achievable in 2017. It’s time EPA follows the statutory requirement and increase the conventional biofuel target to 15 billion gallons.”
“The letter explicitly urges EPA to put the RFS program back on track by finalizing blending targets that are in line with Congress’ original intent. The RFS program has successfully grown the biofuels industry in the United States, and finalizing blending targets that satisfy the original statutory requirements will keep that progress intact,” stated Growth Energy CEO Emily Skor. “We commend these members of Congress for supporting progress in the biofuels industry, and protecting America’s security and economy through the RFS. The EPA must return stability to this policy to ensure that we do not turn back the clock on the strides we have made. The RFS improves our environment by reducing harmful emissions and displacing toxic chemicals found in gasoline, creates American jobs, reduces our dependence on foreign oil and gives American consumers a choice of a higher performing, less expensive fuel.”
To read the entire letter, please click here.
USDA Leads Ethanol Trade Mission to Mexico
July 25, 2016USDA Acting Deputy Secretary Michael Scuse recently lead a U.S. ethanol mission to Mexico to explore trade opportunities between the two countries.
The mission participants include representatives from the Renewable Fuels Association, Growth Energy and the U.S. Grains Council who will attend meetings with government officials, legislators and the Mexican private industry.
“Mexico, with the right policies in place, has the potential to achieve similar benefits producing ethanol from sugarcane,” Scuse stated. “We view this as a partnership that can provide benefits for both Mexico and the United States.”
“The U.S. is the world’s largest producer of ethanol and for several years now has been the low cost supplier as well, allowing us to dramatically increase our exports. With domestic use artificially capped by EPA at 14.8 billion gallons, we will continue to seek export opportunities,” said Renewable Fuels Association (RFA) General Counsel Ed Hubbard, who is on the trade mission. “The world is short on octane and looking for low carbon alternative fuels to meet the climate change goals set in Paris last December. This is the right time to explore new trade opportunities. Mexico, in particular, should be looking for replacements to the highly toxic MTBE. Ethanol can help.”
“This trade mission is an excellent example of the importance of ethanol to the success of nations looking to reduce their imports of harmful fossil fuels in favor of a cleaner burning and a more economical fuel,” said Growth Energy CEO Emily Skor. “It is also equally important to our goal of expanding the marketplace for U.S. ethanol, which is why we’re proud to be participating in this mission.”
As USDA explained, mission members will share their experiences with both ethanol production and the development of renewable fuels policies, with the goal of demonstrating how Mexico can implement its own renewable fuels program.
State-owned oil company PEMEX has plans to begin selling E6 (5.8%) ethanol-blended gasoline in selected cities in the Mexican states of Tamaulipas, San Luis Potosi, and Veracruz. Implementation of a nationwide E6 fuel option in Mexico would create a potential market for 790 million gallons of ethanol.
Atlanta-based Retailer RaceTrac Adding E15 to Product Mix
July 25, 2016RaceTrac is joining a growing list of retailers as part of the Prime the Pump initiative. Prime the Pump members work in collaboration with Growth Energy to make higher biofuel blends, like E15, available to more Americans across the United States. RaceTrac joins Sheetz, Kum & Go, MAPCO, Minnoco, Thorntons, Murphy USA, Protec, and several others as the newest retailer to offer consumers a cleaner burning, home-grown American fuel.
“We are thrilled to have RaceTrac join our retailer family and look forward to expanding access to E15 for consumers across the Southern United States with them,” said Growth Energy CEO Emily Skor. “As a longtime supporter of alternative fuels, such as E85, RaceTrac is committed to providing its customers with a choice at their pumps. By adding E15, RaceTrac will bring even more renewable fuel options to consumers, providing greater choice and savings to motorists.”
RaceTrac is headquartered in Atlanta and operates more than 600 company-owned and third-party contract operated stores under the RaceTrac and RaceWay names in 12 southern states.
Student Video Contest Winners Focus on Next Generation Energy Solutions
July 25, 2016Amerigreen Energy recently hosted a video essay challenge as a way for students to express their thoughts on energy solutions for the future. Students created 30-second videos focused on one of the question prompts related to what is the best energy source for the future.
“We were so impressed with the video submissions from students,” said Amerigreen CEO of Energy Services Steve McCracken. “They were extremely passionate, creative and you could tell they had done a lot of research to get the facts right. They made us really encouraged and hopeful. We also want to thank our 100 percent American fuel dealers that garnered community support from area schools, teachers and customers to encourage students to enter the contest.”
The contest was open to students in grades 1-12, as well as undergraduate college students. High school and undergraduate college students entrants vied to win college scholarships and elementary and middle schoolers were eligible for special location ticket packs.
From all the submissions, Amerigreen selected the top five videos for the two age groups. The videos were posted on Amerigreen’s social media pages and the winners were chosen by the most online votes by audience likes.
Winning videos from the High School Division
1st Place (tie), Winner of $2,000 College Scholarship, Lexy from Manheim, Pennsylvania. Lexy’s video focused on the future of U.S. energy, and what part biofuels plays in that picture. She referenced biofuels’ domestic sources, reduced emissions and opportunity to create a better future for the next generation.
1st Place (tie), Winner of $2,000 College Scholarship, Alexandra from Malvern, Pennsylvania. Alex’s video depicted a world of clean, renewable alternative fuels for our energy future. She emphasizes that when one person cares and works to make a difference it matters—and the choice begins with you.
3rd Place, Winner of $500 College Scholarship, Injee from Belle Mead, New Jersey. Injee’s video focused on biofuels as a renewable energy source with many new feedstocks in development, and it is a secure energy source for generations to come.
To see all the videos, please click here.
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