Ethanol’s chief benefit is environmental.  …Last summer, there were no smog alerts in the GTA and 5.5 million Canadians breathed easier. Ethanol was a major factor in cleaning the air above Canada’s biggest metropolis.

A lesser-known fact is that the smaller, lighter car engines with high horsepower coming on to the market today require a higher-level octane gasoline. The traditional way to increase octane is to boost the level of aromatics in the fuel, specifically benzene, toluene and xylene. All three of these compounds are carcinogenic. The alternative method of increasing octane is to add ethanol, which has an octane of 114 and delivers plenty of extra power. That’s why Indy and NASCAR racers use ethanol.

Ethanol also reduces the price of gasoline at the pump. With about 15 billion gallons of ethanol in the North American gasoline pool today, gasoline is about 10¢ cheaper per litre in Canada and about 40¢ cheaper per gallon in the United States.  READ MORE

“I think it’s going to be a chaotic spring, with huge price increases in some places,” says Tom Kloza of the Oil Price Information Service, who expects average prices to peak at $4.05 nationally, although he and other industry trackers say prices could be sharply higher in some places, such as Chicago.

…Refiners also switch from winter formulations to more expensive seasonal formulations to meet stringent environmental standards, which can tack on 15 cents a gallon, says Brian Milne of energy tracker Televent DTN.

…“Higher demand, Iran, lost refining capacity are all potential problems,” Milne says. “We’ll get over $4 a gallon, but it’s going to be tough to sustain that level. People will drive less.”

The committee debated the merits of the bill and a pair of amendments for about 45 minutes before passing the bill by a vote of 19-7. If passed into law, Sensenbrenner’s bill would delay the implementation of E15 by at least 18 months while the NAS conducts its testing. The bill allows for up to $900,000 of the U.S. EPA’s research and development funds to be used to finance the testing.

…Opponents, however, claim that Sensenbrenner’s proposal is little more than an effort to disrupt the EPA’s regulatory abilities and expressed confidence that the bill will not be passed into law.

… “Those of us in California and around the country do have concerns about corn-based ethanol,” Rep. Zoe Lofgren, D-Calif., said. “It’s a complex and important issue…but we should not stop the EPA from conducting its required activities under the Clean Air Act. To do so would weaken and undermine our environmental laws and procedures.”  READ MORE

Drevna told the biodiesel crowd that RFS2 is very narrow from a biodiesel industry perspective. “But when refiners look at it,” he said, “they have to look at the whole thing,” meaning the four buckets of conventional, cellulosic, advanced and biomass-based diesel. “And it’s not working as intended,” Drevna added.

When 20-plus percent of the oil industry’s market is mandated away, that’s not good, he expressed.

…Drevna was quick to bring up the shutdown of two refineries on the East Coast, stating that the halt in operations was a result of RFS2 taking away more than 20 percent of the market by 2022. Maniscalco countered that by offering other reasons such as issues surrounding Brent crude and West Texas Intermediate, desulfurization requirements, the age of the refinery equipment and more.  READ MORE

Both plentiful and a potentially low-cost source of fuel, biomass residuals are also less controversial than traditional corn ethanol because they are not a source of food or feed. Turning stover (the stalks, leaves and cobs that remain in corn fields after the grain is produced) into ethanol or using anaerobic digesters on livestock farms to generate bioenergy from animal manure are seemingly win-win propositions — more income for agricultural producers, new home-grown energy sources, and environmental protections for states and their communities.

But as Steve Brick, a senior fellow at the Chicago Council on Global Affairs, notes, there are technological, logistical and cost hurdles to overcome in order to expand the use of these energy sources.

And he says states are in a position to help.  READ MORE

“The RFS works,” glowed National Biodiesel Board CEO Joe Jobe, in marking the industry’s first billion-gallon production year in 2011, as industry benefitted from a now-expired $1.00 per gallon biodiesel tax credit, and from the billion gallon mandate called for under the Renewable Fuel Standard.

…“It’s a fantasy to think that global energy prices are based on a free market; they are controlled and manipulated by a cartel,” Jobe said.

…Just now, the EPA has thrown out another 48.1 million fake biodiesel credits, this time sold by Absolute Fuels in Texas. It follows on last year’s scandal when Clean Green Fuels of Maryland had 32.3 million credits declared invalid. Neither company had produced biodiesel equivalent to the credits they pretended to have sold.

The refining industry is up in arms. The EPA has demanded that they pay fines for submitting fake RINs, and also buy new, real ones; and, the agency said that the obligated parties would have to recover the money paid out for fraudulent RINs by their own legal action against the sellers.  READ MORE

Domestic oil output is the highest in eight years. The U.S. is producing so much natural gas that, where the government warned four years ago of a critical need to boost imports, it now may approve an export terminal. Methanex Corp., the world’s biggest methanol maker, said it will dismantle a factory in Chile and reassemble it in Louisiana to take advantage of low natural gas prices. And higher mileage standards and federally mandated ethanol use, along with slow economic growth, have curbed demand.

…With the price of a barrel of oil at about $100, a drop of 4 million barrels a day in oil imports — which he ( Adam Sieminski) said could happen by 2020, if not before — would shave $145 billion off the deficit. READ MORE

The SDSU Extension farm precision agronomist has been telling farmers at crop expos this winter and others he talks with that producers wouldn’t have the prices they do today on their crops without the liquid fuel.

…”The success of ethanol is incredibly, incredibly important for Midwest agriculture and the economies of the Midwest area. It’s because of ethanol that we have the prices we do. Could you imagine one-third more corn in the market now?” Carlson said.

After all, it’s his employer, SDSU, where the first ethanol dry mill production plant in the United States was developed by Paul Middaugh in the 1970s. The microbiology professor took his still to the mall in Washington, D.C., and started the ethanol revolution.

Carlson can talk for hours about the benefits of ethanol. Historically, he goes back to 1908 when Henry Ford said that alcohol was a cleaner, better fuel for automobiles than gasoline.

“He was an excellent engineer and he had a switch on his Model T dashboard with a switch that would go back and forth between ethanol and gasoline,” Carlson said.

…To add a few more arguments to the ethanol discussion, Carlson said there have been no major ethanol spills, no wars have been fought over ethanol, no solider has lost his life in a fight over ethanol, zero dollars have gone to Middle East country governments because of ethanol, and no ethanol dollars have funded terrorists.  READ MORE

Congressman Pete Olson, R-Texas, recently introduced the Domestic Alternative Fuels Act of 2012. The measure seeks to modify the renewable fuel standard to include ethanol and other fuels produced from fossil fuels, like natural gas.

Renewable Fuels Association’s Matt Hartwig says it’s not only a misguided attempt to equate fossil fuels as a renewable, but to eliminate the RFS altogether.

“It is simply lunacy to suggest that a fossil fuel belongs in any sort of renewable energy policy in the country,” Hartwig said. “The fossil fuels industry gives these members a lot of money, they are job creators in their district and so this is pandering to a constituency. I think what is more troubling is this may be little more than a Trojan Horse attempt to try to open up the Renewable Fuels Standard on Capitol Hill with the ultimate goal being to repeal it completely.”   READ MORE

“It is the position of the ethanol and grain industries that the contributing factors to the volatility facing the commodities markets are many and cannot be attributed to one industry,” the statement continues. “These factors include the high cost of fossil fuels, currency fluctuations, massive grain buys from emerging markets such as China, and noncommercial market speculators. In fact, studies that have examined both the impact of crude oil prices and biofuels demand on agricultural prices conclude that oil prices are the more influential factor. While it would be naïve to claim that grain demand for ethanol production has no effect on commodity prices, it is equally inaccurate to speculate that future ethanol policies will have a detrimental effect on the livestock and meat industries.  READ MORE