Trump at the Renewable Pump: Will He Bump, Thump or Dump?

by Jim Lane (Biofuels Digest) ... Let’s look at the letter behind the headlines.

“Rest assured that your president and this administration values the importance of renewable fuels to America’s economy and to our energy independence. As I emphasized throughout my campaign, renewable fuels are essential to America’s energy strategy,” Trump wrote.

“As important as ethanol and the Renewable Fuel Standard are to rural economies, I also know that your industry has suffered from overzealous, job-killing regulation. I am committed to reducing the regulatory burden on all businesses, and my team is looking forward to working with the Renewable Fuels Association, and many others, to identify and reform those regulations that impede growth, increase consumer costs, and eliminate good-paying jobs without providing sufficient environmental or public health benefit,” Trump added.

Hmm. There’s support for renewable fuels in there. President Trump reiterates that “renewable fuels are essential to America’s energy strategy,” but when it comes to the RFS itself, the President notes the importance of the Renewable Fuel Standard to rural communities — and then quickly pivots to a theme of identifying and reforming “those regulations that impede growth, increase consumer costs, and eliminate good-paying jobs without providing sufficient environmental or public health benefit.”

The RFA debuted a new study by ABF Economics. which found that the U.S. ethanol industry added $42.1 billion to the nation’s gross domestic product and supported nearly 340,000 jobs in 2016.

According to the analysis, the production and use of 15.25 billion gallons of ethanol last year also:

•generated an estimated $4.9 billion in tax revenue to the Federal Treasury and $3.6 billion in revenue to state and local governments;

•displaced 510 million barrels of imported oil, keeping $20.1 billion in the U.S. economy;

How much U.S. ethanol was produced last year? What were the top U.S. ethanol export markets? What are ethanol’s environmental and octane benefits? How many states offer E15 (15 percent ethanol) blends and how many automakers warranty their vehicles for higher ethanol blends? The answer to these questions and many more is simple, says the RFA — it’s in the 2017 Ethanol Industry Outlook, and that’s here.

Growth Energy delivered an economic analysis commissioned from Edgeworth Economics that identifies numerous problems associated with changing the Renewable Fuel Standard (RFS) point of obligation. Growth Energy strongly supports EPA’s proposed denial to move the point of obligation.

One thing you’ll note in the ethanol industry’s line of discussion — it remains the ethanol industry, only loosely allied with the renewable fuels industry as a whole. Further, we see a shift from RFA — and almost everyone else promoting renewable fuels on Capitol Hill – from discussing the greenhouse gas benefits of renewable fuels to the domestic jobs and energy security that flows from US-based fuel production.

For RFA, the focus is clearly on E15. There’s quite a bit of work to be done with engine manufacturers who might incorporate E30 blends in a new generation of engines designed to reach the 52MPG CAFE standards that are proposed for the 2020s and 2030s.

Those worthy goals are far more in the background as the ethanol industry continues to focus on a E15 tolerance that would boost the potential for ethanol blending well above 20 billion gallons. READ MORE and MORE (Platts) and MORE (High Plains Public Radio) and MORE (Ethanol Producer Magazine)

Excerpt from Platts: But after seizing on the positives, (Bob) Dinneen (CEO and president of the Renewable Fuels Association) sought to remind pollsters, and the new administration, that – far from the disgruntled blue collar vote turning blue states to red – it was the agriculture community that came out for Trump.

218 counties went Republican from Democrat, 133 of which were counties wherein at least a million bushels of corn is grown. “The counties switching in Pennsylvania, Ohio, Michigan, and Wisconsin were not the industrial base, but farm country,” Dinneen boomed, with 93% of the ethanol produced in 2016 coming from a county that voted for Trump, along with 91% of the corn grown. Dinneen corralled Trump’s own campaign words and produced a barnstorming argument that played to the businessman’s core interests. By any measure, the US ethanol is working, is a success, and has potential to grow. Assurances should be due.

In aligning itself with the Trump agenda, Dinneen also moved through a familiar theme when he focused on the question of trade. Acknowledging that free trade agreements were a key plank for many, Dinneen pointedly drew out the Trump commitment to undo bad FTAs, but promote good trade – and, sensing the mood from the White House, took the opportunity to slam Europe’s “blatantly illegal anti-dumping duties” and linking the failure of previous administrations to fight for the industry to the more recent situation with China and its efforts to clamp down on DDGS and limit ethanol imports. READ MORE