EPA Releases Proposed Rule for 2013 RFS Obligations

Joanna Schroeder

The Environmental Protection Agency (EPA) has released it proposed rules today for the 2013 Renewable Fuel Standard (RFS) volumetric requirements. Public comment is open until March 19, 2013. The proposal waives the cellulosic biofuel requirement from one billion gallons to 14 million gallons, but retains overall advanced and renewable fuel requirements.

rfa-logo-09The ethanol industry responded today with statements and Bob Dinneen, the president and CEO of the Renewable Fuels Association said, “The 2013 RFS requirements will be the catalyst that finally compels oil companies to get serious about breaching the so-called blend wall. This year’s RFS requirements will necessitate the use of more E15, E85 and other higher-level blends. Injecting larger volumes of biofuels into the U.S. fuel supply and spurring a more rapid transition to domestically produced renewables is exactly what the RFS was intended to do. The program is working as envisioned by Congress.”

ace logoBrian Jennings, Executive Vice President of the American Coalition for Ethanol (ACE) noted that his organization is concerned, as our other ethanol organizations, about the way the advanced biofuel pool serves as a magnet for imports of Brazilian ethanol. “We appreciate EPA providing us the opportunity to elaborate on this concern and look forward to continuing the dialogue on how to ensure Brazilian imports don’t displace domestic ethanol. The RFS is a catalyst for technology innovation and we believe 2013 will deliver key breakthroughs for U.S. grain sorghum based advanced biofuel and cellulosic biofuel. We look forward to providing additional comments during the 45 day comment period,” said Jennings.

Growth_Energy_logo-1Growth Energy CEO Tom Buis said there are a number of issues that should be considered, which could have serious impacts on the U.S. production of biofuels. “The RFS has been a resounding success, helping create jobs in America that cannot be outsourced, revitalizing rural economies across the country in addition to reducing our dependence on foreign oil and providing consumers with a choice and savings at the pump,” he added.

aeclogoOne of the elements of the proposal waives the cellulosic biofuel requirement from one billion gallons to 14 million gallons. Brooke Coleman, executive director of the Advanced Ethanol Council said that the EPA’s is getting to right number on cellulosic biofuels and noted that the industry is just breaking through at commercial scale. ” U.S. EPA worked hard to ensure that the cellulosic biofuels volume standard for 2013 would be tied directly to the commercial production of cellulosic biofuels expected to come online this year. While weaning the United States off of its addiction to foreign oil is not easy, the volume standards proposed today will continue to provide advanced biofuel investors and innovators with a predictable and durable path forward in that effort.”

In conclusion, the industry representatives said they look forward to working together to finalize the targets.

ACE, advanced biofuels, AEC, Cellulosic, Ethanol, Growth Energy, Renewable Energy, RFA

General Wesley Clark Rallies The Troops

Chuck Zimmerman

General Wesley Clark Growth Energy AG CONNECT ExpoAt today’s U.S. Custom Harvesters luncheon, sponsored by New Holland, retired General Wesley Clark, co-chairman of Growth Energy, took the stage. The organization is holding their 30th annual convention which is co-located with the 2013 AG CONNECT Expo in Kansas City, MO.

Gen. Clark says his passion was the military and now his passion is national energy security and the move away from dependence on foreign oil. I have recorded his remarks for you to listen to or share below.

You can listen to or download General Clark’s remarks here: General Wesley Clark Remarks

I am attending this week’s show and sharing stories on AgWired.com and PrecisionPays.com.

2013 AG CONNECT Expo Photo Album

Audio, biofuels, Ethanol, Growth Energy

U.S. Ethanol Prices & Production Lower Than 2011

Joanna Schroeder

According to a 2012 Brief released by the U.S. Energy Information Administration (EIA), U.S. ethanol prices and production are lower compared to 2011. Spot prices for U.S. fuel ethanol were lower throughout most of 2012 compared to 2011. Prices were relatively stable during the first half of 2012, but they rose at mid-year as severe drought and high temperatures reduced corn yields, resulting in higher prices for corn that is used to produce the majority of all U.S. ethanol.

Screen Shot 2013-01-31 at 12.53.22 PMHigher ethanol prices during the second half of 2012 were mainly the result of higher corn prices, which rose 35 percent from mid-June through August due to concerns that the corn crop would be affected by the worst drought in the Midwest since the 1950s, coupled with triple-digit temperatures. During the hot and dry summer of 2012, the U.S. Department of Agriculture reported that 88 percent of the U.S. corn crop was within a drought area.

The 2012-13 U.S. corn crop is expected to be the smallest in six years at nearly 10.8 billion bushels, according to USDA’s January 2013 crop forecast, 13 percent smaller than the 2011-12 crop. USDA indicates that about 4.5 billion bushels, or 42 percent of the harvest, will go to make ethanol. That level is down from just over 5 billion bushels used to make ethanol during the previous crop year.

The brief finds that the combination of lower corn supplies, higher corn prices for ethanol producers, and weaker gasoline demand contributed to U.S. ethanol output falling from an average 900,000 barrels per day (bbl/day) during the first half of 2012 to an average of 815,000 bbl/day during in latter half, about 90,000 bbl/day less than in the second half of 2011.

Ethanol, Renewable Energy

DOE Announces New SunShot Projects

Joanna Schroeder

The Department of Energy (DOE) has awarded seven data-driven projects focused on reducing costs and accelerating solar energy deployment as part of the SunShot Initiative. DOE said the goal of the projects will result in viable methods for dramatically transforming the operations of solar researchers, manufacturers, developers, installers and policymakers, and speed the commercialization and deployment of affordable clean energy.

Print“Through powerful analytical tools developed by our nation’s top universities and national labs, we can gain unparalleled insight into solar deployment that will help lower the cost of solar power and create new businesses and jobs,” said Energy Secretary Steven Chu. “Projects like these will help accelerate technological and financing innovations – making it easier for American families and businesses to access clean, affordable energy.”

The Energy Department will invest about $9 million across the seven projects. These efforts will help scientists, project developers, installers and communities work together to discover previously unexplored ways to improve solar cell efficiency, reduce costs and streamline installation processes.

As part of the investment, DOE will provide $7 million to research teams led by Sandia National Laboratories, the National Renewable Energy Laboratory, Yale University and the University of Texas – Austin, and $2 million across three projects led by the University of North Carolina – Charlotte, Massachusetts Institute of Technology and SRI International.

Find the full list of projects here.

Alternative energy, Clean Energy, Solar

USDA Undersecretary Optimistic About Biofuels

Cindy Zimmerman

iarfa-13-dallasUSDA Undersecretary for Rural Development Dallas Tonsager is optimistic about the future of biofuels.

“When faced with an economic challenge, rural Americans came up with an economic solution and developed a biofuels industry,” Tonsager said in an interview after speaking to the Iowa Renewable Fuels Summit. “My belief is, as time goes along and we’re faced with challenging circumstances again, people will come up with solutions again.”

Tonsager sees success coming in the cellulosic biofuels world which should begin to demonstrate its economic viability as well. “We’ve got a lot of challenges in ethanol,” he said. “But the industry is stepping up and fighting and I think that is an extremely positive sign.”

Listen to an interview with Tonsanger here: USDA Undersecretary Dallas Tonsager


IRFA Renewable Fuels Summit Photo Album

Audio, Ethanol, Ethanol News, Iowa RFA, USDA

Growth Energy CEO at Iowa Renewable Fuels Summit

Cindy Zimmerman

iarfa-13-buisGrowth Energy CEO Tom Buis told attendees at the Iowa Renewable Fuels Summit this week that the biofuels industry needs to meet the challenges ahead and keep moving forward.

“We have our challenges, but we have our opportunities,” Buis said in an interview after his speech, noting that the industry can expect continued attacks on the Renewable Fuel Standard (RFS). “We’re not just doing to play defense, we’re going to go on the offense.”

That includes the industry coalition Fuels America, which is working to combat the weekly assaults on the RFS by detractors. Buis says the RFS is the “best energy policy this nation’s passed in the last 40 years and we shouldn’t give up on it the fifth year into a 15 year program.”

Listen to interview with Buis here: Growth Energy CEO Tom Buis
IRFA Renewable Fuels Summit Photo Album

Audio, Ethanol, Growth Energy, Iowa RFA, RFS

RFA Condems UN Biofuels & Food Security Study

Joanna Schroeder

Earlier this month, the U.N. Committee on World Food Security (CFS) has released a draft study on biofuels and food security with a public comment period until January 30, 2013. Yesterday, the Renewable Fuels Association (RFA) submitted comments about the report and its several policy recommendations.

maize harvest Photo: FAO/Giulio NapolitanoThe authors write, “Our report has confirmed the central role of biofuels in provoking high and volatile food prices, and therefore, we point to the fact that there is enough evidence to call in question the use of mandates/targets together with subsidies and tariffs where these artificially stimulate biofuels production. Our Report concludes, however that in the context of persistent high oil prices, biofuels from maize in the US and from sugar-cane in Brazil can be, for different reasons, market competitive. In this situation, we must advance beyond the discussion of mandates and subsidies to include mechanisms for controlling the growth of biofuels markets. The recent EU Directive has moved in this direction, and while the EPA in the US has rejected the suspension of targets, maize/ethanol has almost reached its current allocated share of the biofuels market. Policies should now be directed at ensuring that domestic ceilings are not made innocuous by the emergence of a global biofuels market.”

Geoff Cooper, RFA’s Vice President for Research and Analysis, explained that the draft report “needs substantial revision before it can be submitted for official peer review. Not only does the report fail to discuss potentially positive impacts of biofuels expansion on food security, but it also inappropriately expands the intended scope of the study, blatantly disregards input from the May 2012 consultation, fails to include a comprehensive literature review, and adopts highly questionable assumptions regarding animal feed co-products, crop yields and other factors.”

The RFA comments reflect the association’s belief that “biofuels are providing tangible benefits and positive outcomes for both the world’s farmers and consumers. Biofuels have already proven themselves as agents of economic development, environmental improvement, and social progress in many developed nations. We believe biofuels can bring the same benefits to developing nations without jeopardizing food security. In fact, biofuels have the potential to serve as an important tool in reducing food insecurity. Indeed, we agree with the U.N. Food & Agriculture Organization (FAO) that: ‘…investment in bioenergy could spark much-needed investment in agricultural and transport infrastructure in rural areas and, by creating jobs and boosting household incomes, could alleviate poverty and food [in]security.’”

You can read RFA comments in full here.

biofuels, food and fuel, RFA

IRFA Renewable Fuels Summit Smashing Success

Joanna Schroeder

A bit of bad weather couldn’t keep people away from the 7th Annual Iowa Renewable Fuels Association’s (IRFA) Renewable Fuels Summit. The event kicked off with remarks from Executive Director Monte Shaw who said that the renewable fuels industry was ready to fight for the future. The organization, on behalf of its members, said Shaw will fight for the Renewable Fuel Standard (RFS2), as well as consumer access to higher ethanol and biodiesel blends.

“Today I can assure you that the Iowa renewable fuels industry is ready for the fight ahead,” said Shaw during his presentation. “We know that Big Oil has the money, but we have iarfa-13-montethe facts. We are ready to fight for more choices at the pump – cheaper, cleaner, homegrown choices.”

Shaw noted that the national priority is to defend the RFS from attacks by the petroleum industry. “We should start by protecting the federal renewable fuels standard (RFS) from the assault by Big Oil,” continued Shaw. “In the face of the federal petroleum mandate and the massive Big Oil tax subsidies, the RFS is the best tool we have to help open doors for ethanol and biodiesel. The RFS promotes consumer fuel choice at the pump. The RFS brings more marketplace forces into the fuel sector, not less.”

In addition, Shaw called upon Governor Terry Brandstad, who also presented during the morning session, along with the Iowa Legislature, to promote higher biodiesel and ethanol blends. “Iowa does not suck one hydrocarbon out of the ground. We produce renewable fuels. Today, IRFA is calling on the Iowa Legislature and Governor Branstad to include a B10 and E15 tax differential in any legislation changing Iowa fuel taxes,” said Shaw.

Shaw noted that relative to other states, the last five or six years have been good for Iowa and renewable fuels have played a major role. To underscore the point, IRFA released a biodiesel economic study.

“We must fight for our future. So join me in committing to fight for renewable fuels in 2013,” concluded Shaw.

Click here to view Shaw’s entire speech.

Click here to view the IRFA Renewable Fuels Summit Photo Album.

You can listen to my wrap-up interview with Monte here: Renewable Fuels Industry Ready to Fight for Future

advanced biofuels, Audio, Biodiesel, Ethanol, Iowa RFA

Study: Biodiesel Boosts Revenue for Iowa’s Farmers

Joanna Schroeder

A new study released today during the 7th Annual Renewable Fuels Summit quantifies how biodiesel production boosts revenue for Iowa’s crop and livestock farmers. The study’s results demonstrate that when Iowa farmers use biodiesel, they not only positively impact Iowa’s economy, they boost their own bottom line. The study was conducted by John Urbanchuk, an economist with Cardno Entrix and was supported by the Iowa Renewable Fuels Association (IRFA), Iowa Soybean Association (ISA), Iowa Corn Growers Association (ICGA), and Iowa Biodiesel Board (IBB).

iarfa-13-urbanchukDuring the unveiling of the study, Urbanchuk said, “Biodiesel producers are part of a manufacturing sector that adds substantial value to agriculture commodities produced in Iowa and makes a significant contribution to Iowa agriculture. Increased biodiesel production raises both soybean and corn prices and boosts revenue for Iowa crop farmers. Since increased crush demand for soybeans also increases production of soybean meal, an increase in biodiesel use and soybean oil demand will reduce soybean meal prices to the benefit of Iowa’s livestock producers.

Seventy-two percent of all biodiesel produced in Iowa was produced from soybean oil in 2012. This increased demand, said Urbanchuk, benefits Iowa’s growers by raising the price of soybeans by more than 8 percent, and increasing the price of corn by more than 5 percent. For example, for a corn and soybean grower with 400 acres, this would equate to a more than 9 percent increase in net profits. In addition, demand also reduces the cost of some feed ingredients, such as soybean meal, by more than 13 percent and distillers grains by 5 percent.

While soybean oil was the leading feedstock last year, the biodiesel industry also used nearly 250 million pounds of animal fats. Taking into account both production costs and revenues, biodiesel production boosts the net income for an Iowa farmer finishing cattle by more than $16 per head. In addition, the study found that the industry also decreases production costs for hogs while increasing revenue leading to a net income for an Iowa hog farmer by more than $4 per head.

When crop and livestock production are combined, the benefits to Iowa’s farmers are even greater. Taking into account both production costs and revenue an Iowa farmer raising crops and cattle would see nearly a 17 percent increase in net income, while an Iowa farmer raising crops and hogs would see nearly a 20 percent increase in net income.

“The bottom line is that biodiesel has a net positive impact on finishing hogs and cattle in Iowa,” added Urbanchuk.

View the IRFA Renewable Fuels Summit Photo Album.

advanced biofuels, Biodiesel, Ethanol, Iowa RFA, Research

Using Corn to Support Biofuel Production

Talia Goes

Our latest ZimmPoll asked the question, ”How many machines (tractors, etc.) does your farm own?”

Our poll results: The majority of you at thirty-five percent own 10+ machines and equipment. Twenty-five percent own 3-5, close behind was 6-9 at twenty-one percent, thirteen percent own 1-2, and six percent said other. As we suspected, every farm and farmer has a different way of doing things which means some need more machinery and some need less.

1.30.13graph

Our new ZimmPoll is now live and asks the question, “Do you support biofuel production and the use of corn to do this?” Biofuel production of corn produces several types of biofuels such as biodiesel, biogas and different bioalcohols. This high octane mixture can be used in most of today’s modern traditional types of vehicles. Is this the way of the future? Let us know what you think.

ZimmPoll is sponsored by New Holland Agriculture.

biofuels, New Holland, ZimmPoll