Ethanol Report on Hearing Highlights

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Back to back hearings on topics related to small refinery exemptions under the Renewable Fuel Standard brought ethanol supporters out to explain how EPA’s abuse of the waivers is hurting farmers and producers and how the new proposed rule is insufficient to fix the problem.

In this edition of The Ethanol Report, we hear from some of those who testified at a House Energy and Commerce subcommittee hearing and the public hearing in Michigan on EPA’s proposed supplemental rule to address the waivers, including Renewable Fuels Association (RFA) president and CEO Geoff Cooper, Iowa farmer and ethanol plant president Kelly Nieuwenhuis, Rep. Dave Loebsack (D-IA), Iowa Secretary of Agriculture Mike Naig, and Show Me Ethanol general manager Brian Pasbrig.

Ethanol Report on Hearing Highlights (18:45)

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Ethanol Opportunities in West Africa

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U.S. Deputy Secretary of Agriculture Steve Censky is on a trade mission to West Africa this week to help United States exporters unlock new opportunities in a region where strong economic growth is driving demand for imported food and farm products, including ethanol.

“Here in West Africa they are using another product as an octane enhancer rather than ethanol,” said Censky during a press briefing from Accra, Ghana on Wednesday. “It is a product that has some corrosive effects, not only on gas tanks and in engines, but also has some health and environmental issues similar to what our own MTBE had in the United States.” Censky says that offers a great opportunity for ethanol in that market for U.S. ethanol producers.

The United States already accounts for nearly 48 percent of Nigeria’s ethanol imports, making that country our 15th largest market for exports. As the auto fleet expands and demand for clean fuel increases, the market for U.S. ethanol is expected to grow.

Listen to Censky’s comments here:
USDA Deputy Censky ethanol comments from West Africa (:48)

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Biofuels Groups Express Concerns at EPA Hearing

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Representatives from multiple ethanol and biodiesel stakeholder organizations and companies delivered basically the same message to the Environmental Protection Agency during a hearing Wednesday on the proposal to make up for volumes lost under the Renewable Fuel Standard due to small refinery waivers – nice try, but you still need to follow the law.

Iowa Secretary of Agriculture Mike Naig testified to the sense of betrayal experienced by the industry when the proposal was announced:
“On Oct. 4, we celebrated when the EPA announced that it would reallocate waived gallons based on a three-year rolling average of actual exemptions. This would ensure the future RFS levels would be met, and I was proud to support this deal,” said Naig. “A week later, we were astonished to learn that the EPA had rebuffed President Trump’s commitment to Iowa’s leaders and proposed a rule which offered no accountability or transparency, and fell short of the 15 billion gallon commitment. The proposed rule is eroding the public’s trust and creating even more uncertainty in the market.”

EPA Hearing Naig Testimony

Renewable Fuels Association President and CEO Geoff Cooper – “This proposal fails to reflect the letter and spirit of the president’s commitment to restore integrity to the RFS, fails to assure that the statutorily-required 15-billion-gallon level for conventional biofuels will be met, and fails to restore stability in the marketplace by definitively ending the practice of allowing small refinery exemptions from eroding RFS biofuel demand.”

EPA Hearing RFA Testimony

American Coalition for Ethanol CEO Brian Jennings – “While this proposal is not going to make renewable fuel producers whole for EPA’s prior abuse of SREs, we urge the Agency to take a small step in the right direction by issuing a final rule which reallocates the actual average volume waived from 2016 through 2018 and ensures at least 15 billion gallons for the 2020 compliance year.”

EPA Hearing ACE Testimony

National Biodiesel Board Director of Regulatory Affairs Kate Shenk – “EPA should change how it accounts for small refinery exemptions in the final rule in order to ensure that the renewable volume obligations are achieved. EPA could do so by taking further steps to limit the number of exemptions it grants in the future. Or, it could base its estimate for the number of small refinery exemptions in 2020 on the number of exemptions it has actually granted in recent years.”

EPA Hearing NBB Testimony

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EPA Hearing in Michigan Today

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Ethanol and biodiesel producers and industry representatives are back in Ypsilanti, Michigan for the second time in three months to provide comments on an Environmental Protection Agency (EPA) Renewable Fuel Standard (RFS) proposed rule. On July 31, it was the rule to set 2020 renewable volume obligations (RVOs) and the 2021 RVO for biomass-based diesel, where the majority of comments focused on whether EPA should account for small refinery exemptions (SREs).

This time, the topic is how EPA has proposed it will account for those waivers.

Specifically, the agency is seeking comment on projecting the volume of gasoline and diesel that will be exempt in 2020 due to small refinery exemptions based on a three-year average of the relief recommended by the Department of Energy (DOE), including where DOE had recommended partial exemptions. The agency intends to grant partial exemptions in appropriate circumstances when adjudicating 2020 exemption petitions. The agency proposes to use this value to adjust the way we calculate renewable fuel percentages. The proposed adjustments would help ensure that the industry blends the final volumes of renewable fuel into the nation’s fuel supply and that, in practice, the required volumes are not effectively reduced by future hardship exemptions for small refineries.

The hearing will begin at 9:00 a.m. EST and end when all parties present have had a chance to speak. EPA has provided call-in information for interested parties to listen to the hearing.

Biodiesel, biofuels, EPA, Ethanol, Ethanol News, RFA, RFS

Ethanol Technical Information Forum Held in Juárez, Mexico

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American Coalition for Ethanol (ACE) Senior Vice President Ron Lamberty returned to Mexico last week to speak at the first technical ethanol information forum to be held in Juárez, Mexico, just across the border from El Paso, Texas.

“Like Tijuana, Juárez is one of the top destinations for U.S. ethanol in the short-run because El Paso and Juárez are basically one large metropolitan area, divided into two different countries by the Rio Grande,” Lamberty said. “El Paso has a two-billion-gallon refinery and Kinder-Morgan and Magellan fuel terminals already supply stations in Juárez and other cities in the state of Chihuahua. Ethanol is already in those terminals, and some E10 has already been purchased and delivered to stations in the area.”

Lamberty has made a dozen trips to Mexico over the past two years to participate in the forums which are a joint effort of the U.S. Grains Council (USGC) and the Mexican Association of Service Station Suppliers (AMPES) to inform Mexican petroleum marketers about opportunities in sourcing, marketing, and retailing ethanol-blended gasoline. Lamberty attended four other workshops this year, including one in Tijuana, another border city minutes from San Diego’s fuel terminal.

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Biofuels Industry Testifies on Harm Done by RFS Waivers

Cindy Zimmerman

Biofuels industry representatives testified during a House Energy and Commerce Subcommittee hearing Tuesday on how the increase in small refinery exemptions (SREs) under the Renewable Fuel Standard has hurt ethanol and biodiesel producers and farmers.

“EPA’s secretive and underhanded approach to the SRE provision in recent years has destabilized the RFS, reduced the production and use of clean renewable biofuels, increased GHG emissions and tailpipe pollution, and led to lost jobs and economic opportunity in rural America,” said Renewable Fuels Association (RFA) President and CEO Geoff Cooper in his testimony.

Listen to Cooper’s opening remarks:
RFA CEO Geoff Cooper testimony on SRE damage

Testimony was also presented by Gene Gebolys, President and CEO, World Energy; Kelly Nieuwenhuis, President, Siouxland Energy Cooperative, Iowa; and Chet Thompson, President and CEO, American Fuel & Petrochemical Manufacturers.

Nieuwenhuis told lawmakers that EPA’s abuse of small refinery exemptions under the RFS is crippling rural America. “Because of EPA’s actions to help the oil industry’s bottom line at the expense of farmers and biofuel producers, we had to make a hard decision – to idle our plant and shut off a key market for hundreds of local farmers, including myself,” he said.

Listen to Nieuwenhuis’s opening remarks:
Iowa Farmer Kelly Nieuwenhuis testimony on SRE damage

World Energy is one of America’s largest suppliers of biodiesel and CEO Gebolys told lawmakers that small refinery exemptions have destroyed demand for hundreds of millions of gallons of biomass-based diesel and nine biodiesel plants across the country have closed or cut production as a result. “On August 16, I had to tell our employees, suppliers and the communities where we work that we were shutting down production at our plants in Rome, Georgia; Natchez, Mississippi; and Harrisburg, Pennsylvania – as a direct result of the EPA’s misuse of its small refinery exemption authority,” said Gebolys who testified on behalf of the National Biodiesel Board.

Listen to Gebolys’s opening remarks:
World Energy CEO Gene Gebolys testimony on SRE damage

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Registration Open for 2020 Iowa Renewable Fuels Summit

Cindy Zimmerman

The 2020 Iowa Renewable Fuels Summit will take place at the Prairie Meadows Conference Center in Altoona, Iowa on January 16, 2020, just days before the Iowa Presidential Caucuses.

Renewable Fuels Association (RFA) President and CEO Geoff Cooper will keynote the annual event gathering biofuels industry representatives together in the Midwest with the theme Empower, Promote, and Advocate.

In the face of policy uncertainty and an ever-evolving energy landscape, biofuels advocates must unite at the 2020 Iowa Renewable Fuels Summit to empower biofuels producers toward success, promote the many benefits of ethanol and biodiesel, and advocate for the role renewable fuels are ready to play in a low-carbon, high-octane energy future.

The 2016 Summit featured four Republican presidential candidates, including Donald Trump, and considering the high profile ethanol has had on the national stage over the past two years, it is very possible there could be a few presidential hopefuls at the 2020 summit.

The Summit is free to attend and open to the public, but registration is required and now open.

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Witnesses Scheduled for RFS Waiver Abuse Hearing

Cindy Zimmerman

Renewable Fuels Association President and CEO Geoff Cooper will lead off a panel of witnesses for a House Energy and Commerce Subcommittee hearing today on “Protecting the RFS: The Trump Administration’s Abuse of Secret Waivers.”

Testimony will also be presented by Gene Gebolys, President and CEO, World Energy; Kelly Nieuwenhuis, President, Siouxland Energy Cooperative; and Chet Thompson, President and CEO, American Fuel & Petrochemical Manufacturers.

The Environment and Climate Change Subcommittee hearing will focus on EPA’s “mismanagement of the Renewable Fuel Standard (RFS) program” and will also examine H.R. 3006, the Renewable Fuel Standard Integrity Act of 2019, introduced by Rep. Collin Peterson (D-MN).” The bill would set an annual deadline for small refinery exemption applications and bringing transparency to the process.

The hearing is scheduled to begin at 10:30 am Eastern time and will be livestreamed by the committee.

Biodiesel, biofuels, EPA, Ethanol, Ethanol News, RFA

MN State Commissioners Tour Guardian Energy

Cindy Zimmerman

Seven Minnesota state agency commissioners toured the Guardian Energy ethanol plant last week to learn about the plant’s production capabilities and how the ethanol industry helps reduce greenhouse gas emissions and boost the state’s economy. Guardian Energy is located in Janesville, about 75 miles southwest of Minneapolis.

The commissioners who participated in the tour were Steve Grove (Minnesota Department of Employment and Economic Development), Sarah Strommen (Minnesota Department of Natural Resources), Steve Kelley (Minnesota Department of Commerce), Margaret Anderson – Kelliher (Minnesota Department of Transportation), Cynthia Bauerly (Minnesota Department of Revenue), Laura Bishop (Minnesota Pollution Control Agency) and Nancy Leppink (Minnesota Department of Labor and Industry).

Guardian Energy was established in 2009 and has since become one of the largest ethanol plants in the state. The plant uses 50 million bushels of corn annually, sourced within 75 miles of the plant from over 2,000 farmers, to produce 150 million gallons of ethanol, 300,000 tons of dried distiller’s grains and 44 million pounds of corn oil a year.

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RFA Receives Grants for Ethanol Safety Education

Cindy Zimmerman

The Renewable Fuels Association has received new grants to support its safety education program through on-site seminars and on-line webinars via the association’s work with TRANSCAER, a voluntary national effort that focuses on hazardous material transportation incident preparation for communities.

“One of the strengths that sets our association apart is our whole-industry focus that includes high-quality technical assistance such as our safety programs with TRANSCAER,” said RFA Technical Services Manager Missy Ruff. “As we seek to make ethanol more available to drivers nationwide, we want to ensure that ethanol producers, shippers, blenders, and emergency response personnel all have the opportunity to learn more about best practices for safe handling of ethanol and responding to incidents. We are very grateful for the continuing support from TRANSCAER and other partner organizations.”

A $25,000 grant from the Federal Railroad Administration will support 10 ethanol safety seminars and four “train the trainer” webinars for first responders, and a $40,000 Assistance for Local Emergency Response Training grant from the Pipeline and Hazardous Materials Safety Administration will fund another 10 ethanol safety seminars and an update of RFA’s Ethanol Safety Tour video.

Last year, RFA’s safety work with TRANSCAER involved hosting ethanol safety seminars in New York, Vermont, Mississippi, West Virginia, Louisiana, Maine and Virginia reaching a total audience of 506 first responders and safety professionals, and four online “Train the Trainer” webinars, reaching 259 participants in January, March, July and August.

Learn more on RFA’s Ethanol Emergency Response website.

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