Bustos Introduces Next Generation Fuels Act

September 25, 2020

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by Erin Voegele (Ethanol Producer Magazine) Rep. Cheri Bustos, D-Ill., on Sept. 24 introduced the Next Generation Fuels Act, a bill that establishes a minimum octane standard for gasoline and requires sources of added octane value to reduce carbon emissions by at least 30 percent when compared to baseline gasoline. The bill would also limit the use of harmful aromatics in meeting the new high-octane standard, as well as in current-market gasoline.

To accomplish its goals, the legislation would require the U.S. EPA to create a new 98 research octane number (RON) standard, limit reliance on toxic aromatic hydrocarbons, and update fuel and infrastructure regulations to expand the availability of mid-level ethanol blends. It would ensure parity in the regulation of gasoline volatility, correct the R-factor used in fuel economy testing, provide for an E30 fuel waiver, replace the EPA’s flawed MOVES model, and restore meaningful credit toward compliance with fuel economy and emissions standards for the production of flex fuel vehicles.

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The American Coalition for Ethanol said the bill contains key priorities, but features a carbon accounting approach that undermines many of the group’s members. “We appreciate Congresswoman Bustos has introduced legislation designed to remove barriers to higher blends of ethanol and which acknowledges future policy needs to be considered in the framework of GHG emissions,” said Brian Jennings, CEO of Ace. “While this legislation contains many of our top priorities, its approach to carbon accounting is flawed and undermines the investment many ACE members have made to reduce their carbon intensity.”

According to Ace, the bill’s definition of “average” to determine the lifecycle greenhouse gas (GHG) emissions of ethanol, also known as carbon intensity (CI), shortchanges many producers.

“Under this legislation, ethanol from a coal-fired ADM facility, whose fuel is similar to the CI of gasoline, would get the same access to the new octane market as the most efficient farmer-owned ethanol facility, whose carbon footprint is at least 50 percent cleaner than gasoline,” Jennings said. “In other words, the bill as currently drafted would perversely reward ADM for doing nothing to reduce the CI of the fuel produced in its coal-fired facilities and penalize many ACE-member companies that have invested millions of dollars to install technology to reduce the CI of their fuel. We do not believe there is a good rationale for a carbon policy which treats ethanol with a CI that is hardly indistinguishable from gasoline the same as ethanol from a facility that is 50 percent cleaner than gasoline.

“ACE prefers a low carbon fuel policy which assigns each fuel producer an individual carbon intensity score and measures lifecycle GHG emissions to provide credit for farming practices that reduce emissions from fertilizer use and sequester carbon in the soil,” he continued. “Policy with these two components would reward farmers for climate-smart practices and ethanol facilities for making investments to reduce GHG emissions.” READ MORE

RFA Applauds Introduction of Next Generation Fuels Act by Rep. Bustos (Renewable Fuels Association)

RELEASE: Bustos Introduces “Bold and Innovative” Legislation to Reduce Vehicle Emissions, Limit Harmful Aromatics and Increase Biofuels Demand (Office of Rep. Cheri Bustos (D-IL 17))

Next Generation Fuels Act (Congress.gov)

Bustos Introduces the Next Generation Fuels Act (NGT News)

Biofuel Use Bill Introduced in House: Sponsored by Illinois Rep. Bustos, the measure seeks to lower vehicle emissions. (NACS)

What Does the Next Generation Fuels Act Mean for Corn Growers? (Farm Journal Ag Web; includes AUDIO)

RFA Leader Says Next Generation Bill Good For Higher Ethanol Blends (WNAX)

OPINION: Policy advances good news for retailers (Ethanol Producer Magazine)

ILLINOIS FARMERS PRAISE NEXT GENERATION FUELS ACT (Brownfield Ag News)

Illinois Biofuels Producers, Industry Leaders Join Call for Bustos’ Next Generation Fuel Act (Office of Representative Cheri Bustos (D-IL 17))

Next Generation Fuels Act introduced in U.S. Congress (Minnesota Corn Growers Association)

Rep. Bustos Optimistic For Ethanol Future (Energy.AgWired.com; includes AUDIO)

UAI Pleased New Legislation Calls For 95 RON (Urban Air Initiative)

FARMERS AT THE COMMODITY CLASSIC BACK THE NEXGEN FUELS ACT (Brownfield Ag News)

World events spark need for ethanol (News Enterprise)

MISSOURI CORN FARMER OUTLINES NATIONAL-LEVEL PRIORITIES (Brownfield Ag News)

Grassley Leads Bipartisan Introduction Of Next Generation Fuels Act To Improve Vehicle Efficiency, Help Americans Save Money At The Pump (Office of Senator Chuck Grassley)

The New RVOs, Not as Clear Cut as it Might Appear (Biofuels Digest)

Excerpt from Office of Rep. Cheri Bustos (D-IL 17): Fuels with greater levels of octane are more stable and have the potential to make engines more fuel-efficient. This legislation establishes a minimum octane standard for gasoline and requires sources of the added octane value to reduce carbon emissions by at least 30 percent compared to baseline gasoline. Furthermore, the legislation limits the use of harmful aromatics in meeting this new higher octane standard, as well as in current-market gasoline.

“For the last three and a half years, we have been forced to fight battle after battle and face this Administration’s broken promise after broken promise to ensure our country is meeting the full potential of biofuels,” Congresswoman Bustos said. “The Next Generation Fuels Act looks toward the future to make sure we bring an environmental lens to biofuels production, in order to increase demand while reducing carbon emissions.”

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Due to ethanol’s high octane rating, low-carbon, high-octane ethanol blends results in both additional fuel efficiency and significant greenhouse gas (GHG) reduction benefits. Ethanol is also priced lower than gasoline, making it the most cost-effective octane source.

By requiring the new high octane fuel to utilize low-carbon sources, the Next Generation Fuels Act will decarbonize liquid fuels as vehicle technologies advance. This requirement, coupled with a new limit on harmful aromatics content, ensures that progress already made to lower emissions continues.

Using more petroleum-based sources to increase fuel octane would produce more carbon emissions, erase GHG reduction benefits from improved fuel economy and result in more emissions of harmful hydrocarbon aromatics, which degrade air quality and respiratory health. READ MORE

Excerpt from Renewable Fuels Association: By establishing a high-octane, low-carbon fuel requirement, the bill would reduce greenhouse gas emissions, enable greater engine efficiency, and encourage competition and lower pump prices. In addition, the legislation addresses existing regulatory impediments that have slowed the commercialization of high-octane, low-carbon fuels and the vehicles that consume them.

“The Next Generation Fuels Act of 2020 provides a bold and innovative approach to reducing carbon emissions, improving engine efficiency and performance, protecting human health, and removing the arcane regulatory roadblocks that have hindered the expansion of cleaner, greener liquid fuels,” said RFA President and CEO Geoff Cooper. “By establishing the roadmap for an orderly transition to high-octane, low-carbon fuels, this landmark legislation begins an exciting new era in transportation fuels policy. As the world’s top supplier of clean, affordable, low-carbon octane, the U.S. ethanol industry proudly and enthusiastically supports this legislation. We thank Rep. Bustos for her thoughtful leadership and determined efforts to craft and introduce this bill, and we look forward to working together to make this bold vision a reality.”

Specifically, the Bustos bill would establish a certification test fuel with a research octane number (RON) of 98, along with a requirement that the source of the octane boost reduces lifecycle greenhouse gas emissions by an average of at least 30% compared to a 2018 gasoline baseline. The legislation also includes a restriction on the aromatics content of gasoline, ensures parity in the regulation of gasoline volatility (Reid vapor pressure), corrects the “R-factor” used in fuel economy testing, provides for an E30 fuel waiver, replaces EPA’s flawed MOVES model, and restores meaningful credit toward compliance with fuel economy (CAFE) and emissions standards for the production of flex fuel vehicles (FFVs).

RFA first began advocating for the creation of a national high-octane low carbon fuel standard in late 2018. As Cooper outlined the industry’s policy priorities at the February 2019 National Ethanol Conference, he stated, “RFA’s vision for the future includes not only strengthening the RFS, but also pursuing a high-octane fuel standard,” including a requirement for 98 RON fuel, limitations on aromatics content, numerous regulatory fixes, and other measures that would “assure air quality improvements, carbon emissions reduction, and consumer savings for decades to come.” This theme was also a centerpiece of Cooper’s 2020 remarks: “We are actively engaged in discussions with lawmakers, legislative counsel, and regulators around a Low Carbon Octane Standard. We are doing the legal work and the economic analysis. And we are working to broaden the coalition of supporters for high-octane low carbon fuels.”

“Even with increased sales of electric vehicles, it is broadly understood and accepted that our light-duty transportation fleet will continue to rely heavily on liquid fuels and internal combustion engines for decades to come,” Cooper said. “As such, we should be pursuing policy solutions that compel improvements in the environmental performance and efficiency of those liquid fuels and internal combustion engines. That’s exactly what Congresswoman Bustos’s bill does.” READ MORE

Excerpt from Farm Journal Ag Web: “Really, it paves the way for higher blends of ethanol to get in the fuel supply,” says Kevin Ross, National Corn Growers Association (NCGA) outgoing president. “That translates into about five billion gallons of ethanol as well as 1.7 billion bu. of corn.”

If this bill were to pass, it would make a huge splash for the corn market, however, deals like this don’t happen overnight. Consider this the first step in a long journey.

It’s not just lawmakers who have to buy in, auto manufacturers will need to move to a new generation of engines that can accept this new gasoline standard. If passed, the Act would move the country to accomplishing environmental goals.

“This paves the way for us to get to higher compression motors and getting these CAFE (Corporate Average Fuel Economy) standards, which are the long-term fuel mileage goals,” Ross says. “At the end of the day, ethanol is such a great fuel and such a clean fuel.” READ MORE

Excerpt from Urban Air Initiative: Legislation recently introduced in the U.S. House of Representatives by Illinois Congresswoman Cheri Bustos proposes to raise the minimum octane standard to 95 RON, a position UAI has been advocating for years. In fact, one year ago UAI hosted a webinar and invited General Motors and Flinthills Resources to explain their perspectives on how a 95 RON would increase ethanol demand, reduce toxic aromatic compounds, and give automakers and refiners more tools to meet ever increasing efficiency standards.

The new legislation includes several key provisions that would benefit ethanol:

Require 95 RON by 2026
Require automakers to provide a warranty up to 25% ethanol by 2026 and 30% by 2031
Remove various regulatory barriers to higher ethanol blends such as RVP and correcting the MOVES Model
Require EPA to adopt the GREET Model to measure GHG
Re-establish vehicle credits for FFVs and optimized vehicles

UAI President Dave Vander Griend says this approach is not just a great opportunity to use higher ethanol blends but importantly would protect public health by reducing aromatics. This legislation recognizes that regulatory barriers are currently blocking consumer access to higher blends and this would remove those barriers.

UAI joins ethanol industry trade groups, corn growers, and other organizations in endorsing this bill noting it has a long way to go but is an important first step to increase the use of clean octane ethanol. READ MORE

Excerpt from Biofuels Digest: The perplexing Regulatory Impact Analysis

And worse yet is the perplexing Regulatory Impact Analysis (RIA) that accompanied the rule. This analysis claims the RFS, specifically the road transport category, increases every pollutant from NOx to evaporative emissions—even carbon monoxide!

Could that be used in future years to backtrack on RFS volumes and further erode demand? Quite possibly, certainly ethanol opponents could point to that and challenge any use of ethanol, never mind an increase. How could this be? The answer is the MOVES model EPA uses that penalizes ethanol and must be corrected.

So we have our work cut out for us, even if the current proposed RVOs are finalized. The Next Generation Fuels Act, the control of toxics in gasoline, the correction of the MOVES Model, and demanding EPA correct this flawed impact analysis are on the to-do list. READ MORE

Tags

Illinois High Octane Fuel Standard octane octane price/value EPA (Environmental Protection Agency) Legislation-Federal climate legislation gasoline aromatics 98 octane ethanol/bioethanol ethanol blends/ethanol flex fuels R Factor fuel economy E30 E30 pumps waiver MOVES (motor vehicle emissions simulator) modeling system flex-fuel vehicles (FFV) F Factor GHG (Greenhouse Gas Emissions) ethanol prices public health policy health benefits environmental policy Transportation Fuels Policy White House Sustainability High Octane Fuel (HOF) High Octane Gasoline (HOG) High Octane Vehicles (HOV) fuel prices fuel performance fuel efficiency certification fuels life cycle analysis (LCA) Reid vapor pressure (RVP) Corporate Average Fuel Economy (CAFE) standards Renewable Fuel Standard (RFS and RFS2) Regulations-Federal internal combustion engine (ICE) Electric Car/Electric Vehicle (EV) Engine Development Engine/Fuel Co-optimization MOVES2014 MOVES3 (MOtor Vehicle Emission Simulator model)

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