Common Ground

by Matt Thompson (Ethanol Producer Magazine) The future of liquid fuels, whether derived from renewable resources or not, might depend on a collaboration between ethanol and petroleum interests. -- While electric vehicles are gaining popularity, experts say a quick transition to a fully electric fleet isn’t likely, and liquid fuels for transportation will continue to be an important part of the energy equation. But that doesn’t mean the ethanol industry should take the future of its product for granted. And executives of trade groups from both ethanol and petroleum industries say collaboration might be necessary to ensure corn ethanol continues to be a part of the nation’s fuel supply.

In February 2019, the case was made at the National Ethanol Conference for the two industries to come together to agree on a national high-octane standard. “Our collective future is defined by both oil and ethanol working together in a more accelerated way to resolve open issues,” said Dan Nicholson, General Motors’ vice president of Global Propulsion Systems. “The auto and retail sectors are pressing to ensure greater levels of engagement between oil and ethanol,” Nicholson said as he advocated for a 95 research octane number (RON) standard to NEC attendees. Many in the ethanol industry advocate for a 98 RON or higher.

But, at the time, Geoff Cooper, RFA president and CEO, said there was a potential path forward with the petroleum industry. “It would be great if we could get to a point where we can sit down with the autos and oils and come to some agreement that works for everybody,” Cooper said.

Geoff Moody, vice president of government relations for the American Fuel and Petrochemical Manufacturers trade group, is on board, too. He says that while there have been disagreements on policy between the two industries, they shouldn’t be construed as opposition to ethanol in general.

“We’ve long said that ethanol’s a great fuel, and without the Renewable Fuel Standard, our companies would continue to use ethanol,” he says. “Long term, we see ways to make policies work better for all stakeholders and to help improve the efficiency of the internal combustion engine, which we think is important. So it’s a critical relationship.”

Critical Cooperation
While policy goals between the two groups might seem directly in opposition, Cooper says there are issues where they can have a meaningful collaboration. In his dealings with the petroleum industry, he says, it’s clear both industries are advocates for increasing the octane ratings available in U.S. gasoline. “We’ve always believed that in order to get to more efficient vehicles and less carbon intensive internal combustion engines, we have got to have higher octane,” Cooper says. “And I think the refining industry agrees with that.”

But, Cooper says, there are still areas where the two industries are at odds. “There is a gap, and that gap is created by a desire to protect market share,” he says. “We are competing with the petroleum industry for the American driver’s gas tank and so there is going to be that competition and that conflict. But I think we’re moving rapidly into an era where we’re going to have to work together to continue to improve the environmental profile, and at the same time maintain the cost competitiveness of liquid fuels and internal combustion engines, or other alternatives are going to gain a leg up on us.”

Moody says the refining industry owns about 20 percent of U.S. ethanol capacity. READ MORE