RFA’s Cooper: Ethanol Provides Essential Energy for Meeting Global Challenges
(Renewable Fuels Association) Just as ethanol has played an essential role in addressing the COVID-19 pandemic, the low-carbon fuel will also serve as essential energy for combatting climate change, Renewable Fuels Association President and CEO Geoff Cooper said today at the 26th annual National Ethanol Conference.
“As COVID cases began to surge across the country, ethanol facilities quickly ramped up production of the high-purity alcohol needed for virus-killing sanitizers and disinfectants,” said Cooper, as part of his annual “State of the Industry” address. “Many producers took the extra step of bottling and packaging hand sanitizer onsite, and companies throughout the industry generously donated sanitizer and other cleansers to local health care workers and first responders.”
Ethanol producers are also serving as the largest source of dry ice to store and distribute COVID vaccines, Cooper said.
Meanwhile, pandemic-induced lockdowns had an enormous impact on the industry’s production of renewable fuel and co-products like distillers grains. More than half of the industry’s capacity was idled at one point last year, and the 13.8 billion gallons of ethanol produced in 2020 represented the lowest annual output volume since 2013. Cooper noted that when ethanol plants were partially or fully idled last spring, there was a palpable sense of panic coming from the industry’s customers around the world. “After all, they count on our industry to deliver the essential building blocks and ingredients that become fuel, feed, food, beverages, and countless other bioproducts,” he said.
“So, while 2020 was an incredibly difficult year for the ethanol industry, it definitely taught us one thing: When America’s ethanol industry stops running, so does America. Ethanol truly is Essential Energy.”
Still, Cooper noted, ethanol comprised slightly over 10% of the U.S. gasoline pool, the number of retail outlets selling E15 and flex fuels like E85 continued to grow, and the ethanol export total of 1.33 billion gallons was the fourth-highest ever. And even though distillers grains production was down 13% compared to 2019, distillers grains exports actually increased slightly in 2020.
Looking forward, Cooper said ethanol can and should play a central role in the effort to achieve net-zero greenhouse gas emissions by 2050. The carbon footprint of typical corn ethanol is already 50% better than gasoline, he said, with greater reductions on the way. “Mark my words, zero-carbon corn ethanol is coming,” Cooper said.
But, he added, smart policy and regulation will be necessary to ensure ethanol reaches its full potential to decarbonize transportation fuels. That includes restoring integrity to the Renewable Fuel Standard, which according to a new study has already reduced greenhouse gas emissions by nearly one billion metric tons.
Cooper also called on the new Biden administration to remove burdensome roadblocks that are keeping E15 from spreading more rapidly, embrace a national standard for low-carbon and high-octane fuels, and encourage the production of more flex-fuel vehicles, as President Biden himself once called for, when serving as the ranking member of the Senate Foreign Relations Committee.
Click here for a copy of Cooper’s remarks as prepared for delivery. Click here for his presentation slides. READ MORE
Carbon Goal Could Spur Ethanol Demand RFA CEO Calls on Policy to Reduce Liquid Fuel Emissions With High Biofuel Demand (DTN Progressive Farmer)
Once Wary Ethanol Market Hails Potential of Clean-Fuel Policy (Bloomberg)
Excerpt from DTN Progressive Farmer: Seizing upon President Joe Biden’s goal to reduce carbon emissions, Geoff Cooper, president and CEO of the Renewable Fuels Association, pointed to Biden’s goals as a major opportunity for the biofuels industry.
He countered the push by some policymakers to sell only electric cars by 2035, arguing it’s impractical to flip the U.S. vehicle fleet to all-electric. Instead, the U.S. could make more rapid gains in lowering emissions from transportation by “decarbonizing liquid fuels” through greater use of biofuels.
“You have an enormous opportunity to decarbonize (liquid) fuels,” Cooper said. “Let’s not waste it.”
POSSIBLE POLICY IMPACTS
RFA is holding its National Ethanol Conference virtually this week. In a speech, Cooper laid out some policy moves that would lower emissions, such as reining in small-refinery exemptions for petroleum refiners. The Trump administration granted 85 such exemptions over time, which disrupted roughly 4 billion gallons of ethanol demand. EPA also could complete a rule to adjust E15 labeling and allow retailers to use existing underground storage tanks for 15% ethanol, Cooper said.
But a real driver for spurring higher ethanol demand would come from a low-carbon fuels standard — ideally passed into law by Congress. Cooper noted the possibility of “catching lightning in a bottle” with a bill in Congress, but he acknowledged that would not be easy.
“We think there is an outside chance you could see an LCFS move legislatively in the next year or two,” Cooper told reporters during a briefing. The Biden administration might also look at some form of executive action, but Cooper added, “A much safer, more secure route would be through legislation.” READ MORE
Excerpt from Bloomberg:
Todd Becker, chief executive officer of U.S. ethanol producer Green Plains Inc., sees the California model spreading “across several states, if not across the United States and globally as well.”
While Green Plains has a couple of plants that ship into California and can take some advantage of the LCFS, the Omaha, Nebraska-based company needs to see greater national adoption. Becker told analysts last week that any new policy should take into account declining carbon intensity scores for ethanol plants, including all the way down to “zero or negative CI.”
“You are going to see red states and blue states all kind of move to some of these standards and potentially move to a national standard,” he said.
For a map of U.S. states considering LCFS, see: U.S. Biofuels Outlook: From Corn to Cooking Oil (page 12)
Meanwhile, oil refineries in the western U.S. have been busy converting into biofuel plants as part of an explosion in interest of so-called renewable diesel, which now accounts for about 17% of California’s on-road diesel consumption.
“The effectiveness of the LCFS is illustrated by the fact that two thirds of U.S. renewable diesel consumption occurs in California, despite the vast majority of current production capacity being located in Louisiana,” BloombergNEF oil and biofuels analyst Daisy Robinson said.
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Last month, National Biodiesel Board CEO Donnell Rehagen said a national LCFS effort would be welcome but likely a “long slog.” In the meantime, the group will be looking to possibly support state and regional efforts that might be a bit more focused, he said.
“Probably one of the biggest challenges for a national LCFS is all of the consistencies that would factor in and play into that,” Rehagen said. READ MORE
