Fuel Retailers Join Chorus Against RIN Price Cap

Cindy Zimmerman

The American Coalition for Ethanol (ACE) gathered together three fuel retailers who market higher ethanol blends to talk about why a cap on the price of Renewable Identification Numbers (RINS) would be detrimental to their businesses.

Bruce Vollan of Midway Service in South Dakota, Charlie Good of Good & Quick in Iowa, and Mike Lewis of Pearson Fuels in California, have all been marketing E15 to E85 blends for years and understand the RIN system, which was developed as a way to encourage refiners to blend more biofuels.

“What the RINS have done is given us the ability to expand to higher (blends),” said Vollan. “It helps us buy the ethanol, get a good price on the raw product…and pass that on to our consumers.”

Audio file – Bruce Vollan, Midway Service, SD

“I’ve been able to hook up with an ethanol plant that is passing the RIN price down to me,” said Good. “In turn, I was able to immediately lower my E85 and E15 prices.”

Audio file – Charlie Good, Good & Quick, Iowa

Lewis built the first California E85 site in 2003, but has since become a fuel wholesaler for E85. “We now supply 87 retail sites (in California) and 35 more signed and in development,” Lewis said. E85 sells for much less than regular gasoline because of the RIN credits, but as RIN prices go lower, the retail price goes up.

Audio file – Mike Lewis, Pearson Fuels, California

ACE, Audio, Ethanol, Ethanol News, Retailers, RFS, RINS

Iowa Biofuels Groups Spotlight Oil Industry Study

Cindy Zimmerman

Iowa Renewable Fuels Association Executive Director Monte Shaw and Iowa Biodiesel Board Executive Director Grant Kimberley held a joint press conference Friday to discuss an oil industry study make public by Reuters that shows putting a cap on prices for Renewable Identification Numbers (RINS) would not be the “win-win” that Senator Ted Cruz of Texas has repeatedly said he wants for the both the oil and biofuels industries.

Shaw points out that RINS are essentially waiver credits that allow refiners to comply with the Renewable Fuel Standard (RFS) without actually blending any biofuels, and the study shows that the goal of lower RIN prices for the oil industry is to destroy demand for biofuels. “From the very beginning, the other side of this argument has been disingenuous, if not outright dishonest,” said Shaw. “They knew their plan would destroy demand, they knew that was their goal.”

“This is also a biodiesel issue,” said Kimberly, citing a new analysis by the National Biodiesel Board (NBB) and the World Agricultural Economic and Environmental Services (WAEES). “Capping the price of conventional ethanol RINS would lead to a reduction of up to 300 million gallons in biomass-based diesel volumes each year….this happens to be exactly what the state of Iowa produced last year.”

Listen to their comments here: Monte Shaw and Grant Kimberly presser

Audio, Biodiesel, Ethanol, Ethanol News, Iowa RFA, NBB

Ethanol Interests Shout Opposition to RIN Price Cap

Cindy Zimmerman

As concerns began to grow late last week that the Trump Administration was leaning toward a cap on prices for Renewable Identification Numbers (RINs) to appease oil refinery interests, biofuel interests went into high gear to get the word out about how that action would devastate the Renewable Fuel Standard (RFS).

A White House meeting was reportedly set for today (March 12), and then abruptly cancelled, but that did not stop a rally that was set up at the farm of Bill Couser in Nevada, Iowa with just 24 hours notice. The main attraction at the rally was two industry representatives who were part of a meeting with President Trump on March 1 – fuel retailer Charlie Good and ethanol producer Rick Schwarck.

Good and Schwarck described an “intense” meeting which included other biofuel representatives, oil refiner interests, Iowa Senators Grassley and Ernst, Senator Cruz of Texas and several cabinet members. The first part of the discussion revolved around allowing 15% ethanol blends to be sold year round by treating it the same as E10.

“If you allow us to sell (E15) year-round, nationwide, we’ll flood the market with RINs and price will take care of itself, and (the president) understood that,” said Good, noting that everyone in the room agreed that was a good idea.

“For 80 percent of the meeting, everybody agreed that it was good, good, good,” said Schwarck. But towards the end of the meeting, oil interests got more “vocal” and “abrupt” and “really ramped it up on us.”

Good says he got in the last word as he was leaving the room. “I said Mr. President…if you cap the RINs, it will gut the biofuels industry. And he said, I gotta have a deal, Charlie. And I said if you gotta have a deal, cap them at a buck 50,” said Good. “He’s a businessman and he wants to make a deal.”

Rick and Charlie talk about meeting with the president here: Rick Schwarck and Charlie Good comments

Interview with Schwarck: Interview with Rick Schwarck, Absolute Energy

Good, owner of Good & Quick in Nevada, Iowa is one of several retailers who spoke for the American Coalition for Ethanol/a> (ACE) to explain how the RIN system helps them keep prices down for higher ethanol blends:
Charlie Good comments on how RIN system works for retailers


ACE, Audio, corn, Ethanol, Ethanol News, Retailers, RFA, RFS, RINS

Ethanol Plant Operators Say No to RIN Price Cap

Cindy Zimmerman

Discussions are expected to continue this week between oil refinery and biofuels interests over the price of Renewable Identification Numbers, or RINs, which were created under the Renewable Fuel Standard (RFS) as a way to encourage refiners to blend more biofuels.

Renewable Fuels Association (RFA) member plant owners are united in their opposition to the idea of capping RIN prices as low as ten cents to help struggling refiners. The industry has released studies over the past week showing how a price cap of $0.10/gal to $0.20/gal would “likely reduce the effective ethanol mandate from 15 billion gallons to about 14.3 billion gallons in 2018.”

Absolute Energy CEO Rick Schwarck, who attended a White House meeting on the issue with President Trump on March 1, says studies also show it would immediately reduce the price of corn by 25 cents a bushel.

“A billion gallons of RINs would cost $100 billion, but that’s a billion gallons of ethanol that would not be made, and that’s 350 million bushels of corn that wouldn’t be ground,” said Schwarck. “So that’s about $3.5 billion worth of damage to the rural economy for a $100 million of these credit waivers for the oil industry.”

Audio file – Rick Schwarck, Absolute Energy

Randy Doyal, CEO of Al-Corn Clean Fuel in Claremont, Minnesota says a cap on the price of a RIN sets the price for a refiner to buy a waiver so he has no incentive to blend any ethanol. “It doesn’t create demand, it destroys it, and that’s not acceptable,” said Doyal.

Audio file – Randy Doyal, Al-Corn Clean Fuel

Jeanne McCaherty with Guardian Energy, which manages ethanol plants in Ohio, North Dakota and Minnesota, says the RFS is working because it has made a difference in rural communities, and a cap on RIN prices would undo that. “For us to cap RINs, change the RFS and reduce demand, would set us hugely backward,” she said.

Audio file – Jeanne McCaherty, Guardian Energy

Greg Thompson is CEO of White Energy, based in Texas, and there would be a significant impact on the industry if the RIN price were capped. “It’s critical that we let the market place and the dynamics play forward in the setting of RINs (prices),” he explains.

Audio file – Greg Thompson, White Energy

Audio, E15, Ethanol, Ethanol News, RFA, RFS, RINS

Monday Meeting Creating a Buzz in Biofuels

Cindy Zimmerman

With another White House meeting about the price of Renewable Identification Numbers (RINs) now scheduled for Monday, the biofuels industry is getting the word out about how capping prices of RINs would devastate the Renewable Fuel Standard (RFS).

Former Renewable Fuels Association chairman Randy Doyal, CEO of Al-Corn Clean Fuel in Claremont, Minnesota says the industry as a whole is opposed to putting a cap on the price of RINs, which would only help oil refiners. “What’s being proposed is not really a cap on price, it sets the price for buying a waiver,” says Doyal. “Those refiners that don’t want to blend, that aren’t doing it now, that gives them the ability not to. It doesn’t create demand, it destroys it.”

Listen to an interview with Randy here: Interview with Randy Doyal, Al-Corn Clean Fuel

The Iowa Renewable Fuels Association has set up multiple press events at ethanol plants around the state today and a rally tomorrow at the farm of Bill Couser in Nevada, Iowa.

Audio, Ethanol, Ethanol News, RFA, RFS, RINS

New Bill Takes Aim at Ethanol and Biodiesel

Cindy Zimmerman

Legislation to change or repeal the Renewable Fuel Standard usually targets conventional ethanol, but companion bills introduced in Congress this week hit soy biodiesel as well.

Rep. Peter Welch (D-Vt.) and Senator Tom Udall (D-N.M.) introduced the GREENER Fuels Act (Growing Renewable Energy through Existing and New Environmentally Responsible Fuels Act). The legislation is backed by former Rep. Henry Waxman, who now chairs an environmental group called Mighty Earth, and claims “conventional biofuels like corn ethanol and soy biodiesel are destroying wildlife habitat at home and abroad, polluting waterways, and increasing global warming pollution.”

“As representatives of the nation’s leading advanced biofuel, we appreciate Senator Udall’s commitment to environmental stewardship but have concerns with his proposal. It is based on a series of now-debunked studies and fails to recognize the environmental and economic benefits of utilizing homegrown renewable energy,” said Kurt Kovarik, vice president of federal affairs at the National Biodiesel Board. “Biodiesel reduces lifecycle greenhouse gas emissions by anywhere from 57 to 122 percent compared to petroleum diesel, so we would hope that any effort to reform the RFS would continue the growth of clean-burning alternatives to petroleum diesel, like biodiesel.”

The bill would cap the amount of ethanol that can be blended into conventional gasoline at 9.7 percent, even though it is currently more than 10 percent. “If this strange and unserious legislation ever became law it would have the opposite of its intended effect,” said American Coalition for Ethanol CEO Brian Jennings. “Dismantling the RFS in this way would increase pump prices and greenhouse gas emissions.”

National Corn Growers Association president Kevin Skunes disputes the bills’ premise that corn ethanol is harming the environment. “Ethanol production is not significantly impacting land use. In fact, planted corn acres were lower in 2017 than when the RFS was expanded in 2007, yet we produced significantly more biofuels,” said Skunes.

ACE, Biodiesel, biofuels, corn, Ethanol, Ethanol News

Ethanol Production Going Strong

Cindy Zimmerman

For the first month of 2018, the amount of corn used to make ethanol in the U.S. was down two percent from December 2017 but up one percent from January 2017, according to the latest USDA Grain Crushings and Co-Products Production report.

Corn use for fuel alcohol totaled 476 million bushels in January 2018 with dry milling fuel production and wet milling fuel production at 90.6 percent and 9.4 percent respectively.

The World Agricultural Supply and Demand Estimate out for this month is forecasting a smaller corn crop this year with less acres but higher yields. Corn used to produce ethanol is raised 50 million bushels to 5.575 billion based on the most recent data from the Grain Crushings and Co-Products Production report and pace of weekly ethanol production during February, as indicated by Energy Information Administration data.

Weekly ethanol production this year is maintaining at just over a million barrels per day, according to the latest Energy Information Agency (EIA) data analyzed by the Renewable Fuels Association.

For the last week of February, ethanol production averaged 1.057 million barrels per day, or 44.39 million gallons daily, up 12,000 b/d from the week before. The four-week average for ethanol production was unchanged at 1.046 million b/d for an annualized rate of 16.04 billion gallons.

corn, Distillers Grains, Ethanol, Ethanol News, USDA

E15 Now Available at 158 Iowa Stations

Cindy Zimmerman

Iowa has added a dozen new E15 stations since the end of 2017, bringing the total statewide to 158 fueling stations.

Iowa-based Casey’s General Store added the most new stations, including locations in Sioux Center, Akron, Cedar Rapids, and Lone Tree. Kum & Go, Kwik Star, and Key Cooperative each added two new stations at various locations across the state. The last two were added by Sparky’s One Stop in Jefferson and KCK Food & Fuel in Schleswig.

“This time a year ago, Iowa didn’t even have 100 E15 stations,” said Iowa Renewable Fuels Association Managing Director Lucy Norton. “It is remarkable to watch this cleaner, higher-performing fuel gain momentum and support among drivers and retailers. Americans have already driven over three billion trouble-free miles on E15.”

E15, Ethanol, Ethanol News, Iowa RFA

Auto Expert Shares Thoughts on Ethanol at NEC

Carrie Muehling

Participants at the 2018 National Ethanol Conference heard from renowned auto expert and commentator Marc Rauch, Executive Vice President and Co-Publisher of TheAutoChannel.com, on his efforts to educate the auto community and beyond on the use of ethanol in vehicles.

Rauch shared a history of ethanol use around the world and myths that have been spread to negatively impact the fuel’s usage.

“The same oil industry that has been badmouthing ethanol for all these years and standing in the way and using all of their money to sidetrack ethanol from greater acceptance and all of these things is nonsense because the oil industry itself has said ethanol blends are the best fuel for internal combustion engines,” said Rauch.

Listen to the session with Marc Rauch from the National Ethanol Conference here: Marc Rauch, The Auto Channel

2018 National Ethanol Conference Photo Album

Audio, Ethanol, National Ethanol Conference

Rail Issues Impacting Your Business

Carrie Muehling

Rail continues to safely and efficiently serve as ethanol’s “virtual pipeline.” A panel discussion during the 2018 National Ethanol Conference focused on the important role rail transportation plays in the ethanol industry, including updates on regulatory developments, safety issues, and railcar fleet trends.

The panel included moderator Kelly Davis, Vice President of Regulatory Affairs, Renewable Fuels Association; Mark Maday, Staff Director, Hazardous Materials Division, Federal Railroad Administration; Gino Smith, Q\A HazMat Specialist, AllTranstek; and John Kennedy, Senior Vice President, Field Operations, Rescar.

Listen to the panel from the National Ethanol Conference here: Rail Issues Impacting Your Business

2018 National Ethanol Conference Photo Album

Audio, Ethanol, National Ethanol Conference, Renewable Fuels Association, transportation