What is the future of ethanol? This was the topic of discussion during the recent 29th annual American Coalition for Ethanol Conference (ACE). The panel included Chad Friese, General Manager, Chippewa Valley Ethanol Company; Delayne Johnson, Quad County Corn Processors CEO; and East Kansas Agri-Energy President and CEO Jeff Oestmann.
One of the key topics was how to keep the ethanol industry, and thus an ethanol plant, profitable. Oestmann noted that Chippewa Valley has been profitable 19 out of 20 years even through all economic conditions. Why? Diversify. Diversify. Diversify, and manage risk. This sentiment was readily agreed upon by all the panelists.
Another question discussed included how the U.S. Environmental Protection Agency (EPA) is affecting business. In the case of Quad County, Johnson said the EPA is making too many cellulosic waiver credits – around $1.33 per RIN. However, he is hoping that RINS increase to $2.00 next year and if this happens, it will create a $2 to $2.5 million dollar per year revenue stream.
When asked how to position ethanol for long-term success, Friese noted that the country needs to move to higher blends. “We can’t let the EPA continue to hide behind a blend wall. We can’t rely on an export market. We have to find a place for advanced to go into the market.
Listen to the full discussion here: Conversation about the Future of Ethanol