USDA Taking Apps for Biofuels Infrastructure Funding

USDA logoUSDA’s Commodity Credit Corporation (CCC) is now accepting applications in 50 states, the Commonwealth of Puerto Rico and Washington, D.C. for up to $100 million in grants under the Biofuels Infrastructure Partnership (BIP). The funding is to support the infrastructure needed to make more renewable fuel options available to American consumers. The Farm Service Agency will administer BIP.

Through BIP, USDA will award competitive grants, matched by states, to expand the infrastructure for distribution of higher blends of renewable fuel. These competitive grants are available to assist states, the Commonwealth of Puerto Rico and Washington, D.C. with infrastructure funding. States that offer funding equal to or greater than that provided by the federal government will receive higher consideration for grant funds. States may work with private entities to enhance their offer.

CCC funds must be used to pay a portion of the costs related to the installation of fuel pumps and related infrastructure dedicated to the distribution of higher ethanol blends, for example E15 and E85, at vehicle fueling locations. The matching contributions may be used for these items or for related costs such as additional infrastructure to support pumps, marketing, education, data collection, program evaluation and administrative costs.

This new investment seeks to double the number of fuel pumps capable of supplying higher blends of renewable fuel to consumers. This will expand markets for farmers, support rural economic growth and the jobs that come with it, and ultimately give consumers more choices at the pump.

ACE Retailer Roundtable

ace14-retailersTwo fuel retailers took the stage at the American Coalition for Ethanol conference last week in Minneapolis to talk about the trials and rewards of offering their customers a real choice at the pump.

Bruce Vollan (left) of Midway Service in Baltic, SD and Kent Satrang, CEO of Petro Serve USA in North Dakota, shared their stories of why they installed blender pumps at their locations.

“We’re about seven years of having our blender pumps in place,” said Vollan. “It was an ideal time for us to make a change as a small town business.” And, he added, it has grown that business exponentially.

“We’re a Farmers Union oil company,” Satrang said. “We are owned by farmers, so they would like us to sell their fuel.” Beyond that, he just wants to offer his customers a choice.

Both of them also talked about the costs involved in putting in the pumps and offering higher blends and what it has ultimately meant to their communities. Listen to their conversation here: ACE Retailer Roundtable

27th Annual Ethanol Conference photo album

Future for Ethanol Blends

ace14-lambertyGetting higher blends of ethanol in the marketplace continues to be frustrating, even with the approval of E15 (15% ethanol).

The biggest problem continues to be roadblocks by oil companies, according to American Coalition for Ethanol Senior Vice President Ron Lamberty, who compared the sale and use of E15 to premium gasoline. “If you total (all the) vehicles that could use E15, we’re closing in on 15 million vehicles,” said Lamberty, which is 20% of the vehicles on the road. In contrast, about 12% of total cars are supposed to use premium gas, according to their owners manuals, but only 3% of the gas sold is premium. “Oil companies demand that marketers put premium in their stations … oil companies ban E15 sales,” said Lamberty. Ron Lamberty, ACE Senior VP

ace14-drakeFollowing Lamberty at the ACE annual conference this week, Dean Drake of the DeFour Group talked about the next chapter for ethanol blend fuels.

Drake, who spent 34 years with General Motors, says increasing ethanol blends will require significant cooperation between automakers, government, and the ethanol industry. “Neither oil nor ethanol by themselves are a perfect transportation fuel, largely because of octane,” said Drake. “Gasoline is the king when it comes to energy density, but it also has a fairly low octane rating. Ethanol, while having less energy, has a very high octane rating.”

He talked about the potential for what he calls “eco-performance” fuels. “What we’re talking about here is a fuel that would be widely available that would allow auto manufacturers to build advanced vehicles,” he said.

Learn more here: Dean Drake, DeFour Group

27th Annual Ethanol Conference photo album

New Biofuel Station Coming to Inwood, Iowa

A new biofuel station will soon be coming to Inwood, Iowa. Oak Street Station, when completed, will offer higher blends of ethanol and biodiesel to motorists. More specifically, the station will offer ethanol blends E10, E15, E30 and E85, as well as biodiesel blends B5 and B99.9 for independent jobbers and special use customers.

Flex Fuel pump “We’re excited to have received a ‘Fueling Our Future’ grant that will enable us to grow our business and offer unique, locally-produced, clean-burning renewable fuels to Inwood motorists,” said Oak Street Station Accountant Lisa Van Regenmorter. “This funding will allow us to put in the infrastructure to offer higher blends of renewable fuels that are not currently available in the area.”

Oak Street Station was selected to receive $125,000 in funding for the new site from Iowa Governor Terry Branstad’s “Fueling Our Future” program, administered by the Iowa Department of Transportation (IDOT) and the Iowa Department of Agriculture and Land Stewardship (IDALS).

“We congratulate Oak Street Station on becoming a center for renewable fuels by offering some of the highest levels of ethanol and biodiesel available in Northwest Iowa,” added Iowa Renewable Fuel Association (IRFA) Managing Director Lucy Norton. “This innovative approach will keep Iowa in the forefront of the biofuels revolution and provide motorists with greater access to the cleanest, lowest-cost fuels available.”

The new fueling site will feature three ethanol blender pumps and five biodiesel fueling positions, in addition to a vehicle service center and convenience store. Construction is scheduled to begin this summer, with completion expected in January 2015.

Brazilian Mid-Level Ethanol Blends Beneficial

According to a recent report published in Nature Geoscience, when drivers in Sao Paulo switched from ethanol to pure gasoline, there was a 20 percent reduction in local ozone levels in urban areas. However, all gasoline in Brazil is blended with ethanol and upon further review, the report actually showed that using med-level ethanol blends (E25) ozone levels improved.

Steve Vander Griend, with Urban Air Initiative, explained how this is the case. Unlike in the United States, Brazil has two legal fuels: E25 (25 percent ethanol and 75 percent gasoline) and E100 (95 percent ethanol and 5 percent water), better known as hydrous ethanol. Nearly all vehicles sold in Brazil are flex fuel and can use any ethanol blend. Under Brazil’s model, drivers can “choose” their blend of ethanol from E25 up to E100 based on price.

Vander Griend explained that ozone emissions are highest with pure gasoline and also hydrous ethanol. However, emissions are reduced when you add ethanol to gasoline, aka a mid-level ethanol blend such as E15 or E30, blends sold in the U.S. This is why this study found that Brazil saw ozone emissions improve when drivers started using E25 instead of hydrous ethanol (E100). Therefore, said Vander Griend, the notable results of this study are that mid-level ethanol blends do in fact improve ozone emissions.

Sao Paulo gas stationWith 70 percent of Brazilian fuel being E25 during the time frame of this study, the study actually demonstrated Brazil has one of the cleanest burning fuels available, continued Vander Griend, and it also highlighted the value of mid-level ethanol blends.

So why are people being led to believe that ethanol is harmful to the environment? Vander Griend said because you can’t buy pure gasoline in Brazil, when authors refer to gasoline they are really referring to E25 making it appear that the authors studied pure gasoline versus ethanol and this is not the case. With reporters and others not digging into and understanding the study, they are ultimately mis-reporting the facts of the study, added Vander Griend.

The bottom line, said Vander Griend, is that mid-level blends of ethanol have been proven to decrease emissions, and if the U.S. is serious about taking the necessary steps to reduce harmful emissions, it is time that mid-level ethanol blends are offered to consumers.

“Not only will consumers benefit from the availability of a choice and savings at the pump, but when they choose the less expensive, homegrown fuel, they will also be decreasing harmful emissions that are detrimental to our children and future generations,” Vander Griend concluded.

Iowans Increase Use of Higher Blends of Renewables

New data from the Iowa Department of Revenue shows major growth in the use of Iowa Dept of Revenue Logohigher-level blends of ethanol and biodiesel in 2013. The report showed 2013 sales of pure biodiesel (B100) increased 24 percent over 2012, setting a new record of 28.9 million gallons. Biodiesel also saw a 21 percent increase in blended gallons sold, with immense growth in B10 (a fuel blend containing 10 percent biodiesel). Sales of B10 increased by nearly 121 percent, from 32.8 million gallons sold in 2012 to more than 72.4 million gallons sold in 2013. Nearly half of the diesel sold in Iowa is now blended with biodiesel.

The report also showed sales of mid-level ethanol blends, from E15 to E69, increased more than 158 percent in 2013, totaling more than 5.4 million gallons sold. Sales of E85 also hit an all-time high with more than 11.1 million gallons sold, an increase of 18 percent over 2012.

“Iowa motorists and retailers showed a serious commitment to higher-level ethanol and biodiesel blends in 2013,” said Monte Shaw, Iowa Renewable Fuels Association (IRFA) executive director. “The biodiesel sector realized the most growth, with retail locations moving away from low-level blends like B2 to offer consumers B5, B10, and B20. This shows biodiesel is a proven, high-quality fuel and consumers will choose it when offered.”

Shaw added, “Across the board increases in the use of ethanol blends above E10 prove, despite the petroleum industry’s well-funded scare campaign, consumers prefer low-cost, homegrown ethanol. The EPA’s proposal to slash 2014 targets under the Renewable Fuel Standard would be detrimental to the great progress we’ve made improving air quality and increasing our energy security through domestically produced, less expensive ethanol and biodiesel blends.”

Farmers Co-op Breaks Ground on Renewable Fuels Station

Farmers Cooperative Company has broken ground on the future site of its new Mount Ayr, Iowa renewable fuels retail location. The station will offer consumers higher blends of ethanol and biodiesel including ethanol blends E10, E15 as a registered fuel, E30 and E85, as well as biodiesel blends B10, B20 and B99 for jobbers and special use customers.

Groundbreaking-Group.2“The price of [E10] in Iowa is 17-30 cents below gasoline, so the savings is even greater with higher ethanol blends,” Iowa Governor Terry Branstad told the audience at the groundbreaking ceremony. “I’ve told the EPA, if E15 is offered to give consumers a choice, they will choose cheaper renewable fuels.”

Iowa Secretary of Agriculture Bill Northey told attendees, “For this project, we have a great partnership with [Iowa State University] who will be conducting a study to find out why motorists choose the fuels they do. This is a great opportunity to convince others to make the same type of investment.”

Farmers Cooperative Company was selected to receive $125,000 in funding for the new site from Iowa Governor Terry Branstad’s “Fueling Our Future” program, administered by the Iowa Department of Transportation (IDOT) and the Iowa Department of Agriculture and Land Stewardship (IDALS). In addition, Farmers Cooperative will receive $100,000 in funding from the Iowa Renewable Fuels Infrastructure Program. Construction will begin later this year.

“We congratulate Farmers Cooperative Company on this great event to celebrate the groundbreaking on a true renewable fuels retail location that will provide consumers with greater access to clean, locally-produced ethanol and biodiesel,” added Iowa Renewable Fuels Association Managing Director Lucy Norton. “With the help of Gov. Branstad’s ‘Fueling Our Future’ program and the Iowa Renewable Fuels Infrastructure Program, Iowans will continue to benefit from fuel choice at locations like this one.”

Patriot Out Front with Ethanol

nec14-patriot-darryllPatriot Renewable Fuels wants to be the “poster child” for other ethanol plants when it comes to marketing higher blends in their own communities.

You might remember Darrell Rakestraw as the veteran we interviewed last fall about the EPA proposal to lower the Renewable Fuel Standard (RFS). When we spoke to him last week at his first National Ethanol Conference, Rakestraw was three months into his job as market development manager for Patriot. “I’ve learned a lot in three months,” he said. “The one thing I got out of (the conference) is that we have to help ourselves, we have to put the funds in to do the educational piece because no one else is going to do it.”

Listen to my interview with Darrell here: Interview with Darrell Rakestraw, Patriot Renewable Fuels

2014 National Ethanol Conference Photo Album

NEC Coverage sponsored by Patriot Renewable Fuels LLC

State Level Blend Walls Update

nec14-randy-jenningsThe phrase “all politics is local” seems like it sure could apply to some of the decisions to overcome the ethanol blend wall. Challenges to increasing ethanol in the marketplace exist on the state level as well as the federal level, and participants at the National Ethanol Conference learned more about efforts to break down the blend wall in various states, including Tennessee, where Randy Jennings is Director of Program Operations for the state Department of Agriculture Division of Consumer & Industry Services.

“Definitely, the walls are falling,” is how Jennings described the results so far of their efforts, along with the Renewable Fuels Association (RFA), to increase the amount of ethanol to be blended into gasoline in his state.

He said they brought together various Tennessee state agencies, such as the state’s Department of Environment and Conservation (the regulator of fuel storage tanks), Commerce and Insurance, and Department of Labor and Workforce Development, as well as stakeholding industries in Tennessee. They are proposing some key changes in current rules to also be proposed at this summer’s National Conference on Weights and Measures (NCWM). Those changes include: an Environmental Protection Agency (EPA) waiver for up to 15 percent ethanol, redefining E85 and how it is marketed, and proposing yellow grip guards at the pump just for flex-fuels, among other proposed changes. Jennings hopes that there will be more fuel choices for consumers, while working with the industry.

“We remain committed to working with all stakeholders in a fair, consistent manner.”

Hear more of his remarks here: Comments from Randy Jennings, Tennessee Department of Agriculture

nec14-kristy-mooreMeanwhile, RFA Vice President for Technical Services Kristy Moore outlined some of the challenges they face on the state level, including EPA’s restrictions during the summer volatility season.

“[For example in the Kansas City, Kansas area], gasoline in the summer must [meet EPA’s capped requirements]. Gasoline in that area blended with 9-10 percent ethanol is allowed an 8 PSI requirement. But gasoline with 15 percent ethanol, has to meet the more restrictive [requirement],” she explained. And then in the rest of the state of Kansas, there are other requirements for E10 and E15 and above blends.

Moore said they have needed to work state-by-state, making sure they were not crossing laws already on the books and trying to get legislatures to make changes so there could be an increase in blends and more uniform blending rules across the country. She believes they’ve helped eliminate impediments in many states.

“We’ve really have had some major success, major education, and a lot of good partnerships in these state regulators to understand what E15 fuels can do, what blender pumps can do, what E85 can do for their marketplace and their fuel markets.”

Listen to more of here remarks here: Comments from Kristy Moore, RFA

2014 National Ethanol Conference Photo Album

NEC Coverage sponsored by Patriot Renewable Fuels LLC

NEC Breaking Down Blend Wall Panel

nec14-blend-wallTying in to the first part of the theme “Falling Walls, Rising Tides”, the second panel at the 2014 National Ethanol Conference was focused on Breaking Down the Blend Wall.

The panel, moderated by Renewable Fuels Association Director of Market Development Robert White, featured infrastructure experts who discussed efforts underway to expand options for retailers and overall availability of ethanol blends above E10.

Panelists were:
Bruce Sprague, Product Manager, Gilbarco Veeder-Root
Patrick Jeitler, Dispenser Product Manager – North America, Wayne, A GE Energy Business
Steve Walk, VP of Business Development, Protec

Listen to the entire discussion here: NEC Blend Wall Panel

2014 National Ethanol Conference Photo Album

NEC Coverage sponsored by Patriot Renewable Fuels LLC