Biofuels Pivot under Biden

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January 27, 2021

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by Kelsey Tamborrino (Politico’s Morning Energy) Ethanol advocates are pushing for the new Biden administration to boost the portion of each gallon of gasoline that comes from corn. … WHAT WILL BIDEN DO ABOUT BIOFUELS?President Joe Biden’s plan to build out electric vehicle charging infrastructure and speed adoption of EVs will hasten the decline of gasoline consumption. That’s got ethanol advocates pushing hard for boosting the portion of each gallon of gasoline that comes from corn, Pro’s Eric Wolff reports this morning.

“It’s all about an increasing share of a shrinking tank,” said Emily Skor, CEO of Growth Energy, an ethanol trade association. “In the short term, it’s moving from E10 to E15 blend. That’s 7 billion gallons in demand. That would turn us around right there.”

Trade groups see their best near-term opportunity for recovery, after the pandemic slammed all transportation fuels, by pushing for wider adoption of 15 percent ethanol fuel, as well as lobbying the Biden administration officials to promote high fuel efficient engines that would boost demand for ethanol to increase gasoline octane levels.

Skor will deliver a keynote speech today at the Iowa Renewable Fuels Association Annual Summit, where she’ll highlight opportunities for the Biden administration, which she says “campaigned and won on a promise to promote biofuels,” according to excerpts of her remarks shared with ME. “An effective climate strategy must recognize the critical role biofuels play in decarbonizing our transportation sector and bring our farmers into the fold in addressing the climate crisis,” she’ll say.

But ethanol proponents will have to square off against the oil industry, which has not to this point focused much on efficiency rules, as well as against some of the biggest environmental groups that have largely stayed out of the Renewable Fuel Standard battles of the last four years.

The green groups put their weight behind zero-emission EVs and see little purpose in continuing to use internal combustion engines. “We need to move as quickly as possible to zero emission vehicles,” said Katherine Garcia, deputy director for the Sierra Club’s Clean Transportation for All Campaign. “We need to be reducing oil production and then this idea of the biofuels — we do not need a bridge fuel.” READ MORE

Fill ’er up: Ethanol industry looks to help drive demand, net higher prices (High Plains Journal)

Excerpt from High Plains Journal: Last year, Kansas Corn launched the Fueled by Kansas campaign to boost sales of E15—or 15% ethanol. Other states are following suit with similar promotions. The EPA has also lifted a restriction on summertime E15 sales.

The 5% increase in ethanol at the pump could eventually mean a 7-billion-gallon rise in the fuel’s use—or 2.4 billion bushels of new corn demand, (Derek) Peine said.

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“At the end of the day, ethanol has been a huge success for rural America,” Peine said. “Finding a use for corn that is oversupplied—to find new markets for ethanol to increase demand—is big.”

Growing the demand for corn

Like many areas of rural America, ethanol has helped the economy surrounding Oakley, the county seat of Logan County, population 2,800. Western Plains Energy opened in 2004. Today, it employs more than 40 people who help produce 50 million gallons of fuel-grade ethanol from 17.5 million bushels of corn, plus 340,000 tons of wet distillers grain—largely used to feed the region’s cattle industry.

At present, about a third of Kansas’ corn is used in ethanol production, said Josh Roe, vice president of market development and policy at Kansas Corn. He added that studies conducted by Iowa State University indicate approximately 36% of the price of corn is attributed to ethanol.

“So, if we assume $4.70 corn, which is a typical cash price today, roughly $1.69 of that price is directly attributable to ethanol,” he said.

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Kansas and Missouri, along with grain associations, are working to finalize changes to allow summertime E15 sales in the Kansas City metro area.

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“It is usually priced $0.05 lower than E10,” Roe said. “You don’t have the drop off of fuel efficiency. It is a cheaper fuel, cleaner fuel.”

…

At his pumps, Phil Neer, who owns a group of Jump Start stations in the Wichita metro area, said the USDA grant helped him install blender pump technology at one of his Wichita Jump Start locations. Neer now has 15 stations offering higher blends of ethanol, including E15.

He sees the E15 venture as a way for consumers to purchase higher-octane fuel—commonly labeled as Unleaded 88 at his stations—for a price lower than they were paying for 87-octane fuel containing 10% ethanol. READ MORE

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