Below is an op-ed item published in the Wichita Eagle. Go to http://www.kansas.com/120/story/517310.html to see the item. While written by an ethanol industry executive at ICM, he makes some valid points. I trust his statistics are correct. I don’t think someone in his position would “fabricate” misleading statistics. On a side note, he raises a point that has interested me lately, too. Just the other day, I stopped at a station to fuel my Sportster and it had a “This fuel may contain up to 10% ethanol” sticker on it, but it was the same price as Regular at the other nearby stations. I didn’t check the octane rating at the time, but the next time I’m there, I will. If indeed its Regular is 89 octane, it’s a bargain, since it’s the octane equivalent of mid grade at the other nearby stations. Has anyone else experienced this and checked the octane ratings? What are your thoughts?
Time to reconsider criticism of ethanol
In the past, the ethanol industry has been blamed for high food prices and environmental damage.
Last month, the EPA along with several major universities corrected those misconceptions, stating that ethanol is not the root cause for higher grocery prices. In fact, corn prices have recently fallen sharply despite increased ethanol production.
While we know ethanol is not the only answer to long-term energy independence, it is helping lower gasoline prices today. Consumers need to know the truth that oil importers refuse to tell: ethanol is a great deal for our country. Ethanol, in addition to domestically produced oil, is reducing the $1 billion-plus that leave our country every day to pay for a consumable product.
Both ethanol and gasoline are consumable products; however, with ethanol we retain the dollars to do it again.
Merrill Lynch estimates that removing biofuels from the market would result in gasoline prices 15 percent higher than they are today. Based on that analysis, with oil at $110 a barrel and U.S. demand estimated at 9 million barrels a day, ethanol is saving taxpayers $54 billion annually.
Oil importers would have you believe ethanol producers are getting the 51-cent-a-gallon ethanol tax subsidy. In reality, the refiners and gasoline retailers are putting it in their pockets when they purchase ethanol cheaper than the wholesale price of gas and then charge the consumer more for the ethanol-blended fuel.
Many people do not realize that when they are filling their car with unleaded, they are often getting a fuel containing 10 percent ethanol (E-10). If station owners were passing the savings from blending ethanol on to their customers, E-10 should be 5 cents cheaper than unleaded. That’s not happening.
At TJ Convenience, a mom-and-pop store in Colwich, ICM is kick-starting a program that demonstrates how important ethanol is — to consumers, to agriculture, to the environment and to our nation’s security.
At the station, we use special blender pumps to mix fuel on demand to create blends ranging from 10 to 85 percent ethanol. We’ve priced E-10 5 cents below unleaded, and higher percentages of ethanol-enriched fuel are discounted to reflect the subsidy as well as the percentage of ethanol.
Next time you fill up, take note of the octane ratings and prices. Unleaded with no ethanol has an octane rating of 87; E-10 has an octane rating of 89. Unleaded containing 10 percent ethanol is the same thing as 89-octane “midgrade.” I encourage you to ask your local station why they charge more for mid-grade when they’re getting it for less.
As recently as 2006, taxpayers paid farmers $1.8 billion to supplement their income from grain that was priced below the cost of production. Part of that money was also used to pay farmers not to farm 35 million acres of federal Conservation Reserve Program land — 20 million of which could be used for grain without damaging the environment. If the government would release some of this land, we could see lower grain prices and even lower fuel prices while, at the same time, increasing our country’s revenue from agriculture.
Many incorrectly believe that using corn to make fuel means taking food from people’s mouths. Ethanol production merely removes the starch from the corn. Protein and oil are processed into distillers grains, a nutritious livestock feed marketed to feedlots at a price that reduces their feeding cost. Additionally, ICM is perfecting a process that creates additional food-grade products, allowing the most nutritious parts of the corn to remain in the human food supply chain.
It is important for consumers to know that ethanol is environmentally friendly too. The United States Geological Survey says it takes 1,851 gallons of water to extract, transport and refine one barrel of oil or 28 gallons of gasoline, compared with three gallons of water to produce one gallon of ethanol from non-irrigated corn.
A commonly used lifecycle analysis model says that roughly 17.5 pounds of carbon dioxide-equivalent in greenhouse gases are emitted during the lifecycle production and use of one gallon of gasoline on an ethanol-equivalent basis. Most experts are in agreement that the production and use of corn-based ethanol reduces the lifecycle emissions by 20 to 40 percent per gallon of ethanol.
ICM is proud to be part of the answer, and even prouder to be doing our work in the heart of our nation’s agricultural belt — hand in hand with the great leaders and farmers of Kansas.
Dave Vander Griend is chief executive of Colwich-based ICM.
September 10, 2008 at 8:37 am Louisiana Enacts the Most Comprehensive Advanced Biofuel Legislation in the Nation
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Advanced Biofuel Industry Development Initiative Benefits Consumers, Farmers and Gas Station Owners with Localized “Field-to-Pump” Strategy
Baton Rouge, LA (September 10, 2008) – Governor Bobby Jindal has signed into law the Advanced Biofuel Industry Development Initiative, the most comprehensive and far-reaching state legislation in the nation enacted to develop a statewide advanced biofuel industry. Louisiana is the first state to enact alternative transportation fuel legislation that includes a variable blending pump pilot program and a hydrous ethanol pilot program.
Field-to-Pump Strategy
The legislature found that the proper development of an advanced biofuel industry in Louisiana requires implementation of the following comprehensive “field-to-pump” strategy developed by Renergie, Inc.:
(1) Feedstock Other Than Corn
(a) derived solely from Louisiana harvested crops;
(b) capable of an annual yield of at least 600 gallons of ethanol per acre;
(c) requiring no more than one-half of the water required to grow corn;
(d) tolerant to high temperature and waterlogging;
(e) resistant to drought and saline-alkaline soils;
(f) capable of being grown in marginal soils, ranging from heavy clay to light sand;
(g) requiring no more than one-third of the nitrogen required to grow corn, thereby reducing the risk of contamination of the waters of the state; and
(h) requiring no more than one-half of the energy necessary to convert corn into ethanol.
(2) Decentralized Network of Small Advanced Biofuel Manufacturing Facilities
Smaller is better. The distributed nature of a small advanced biofuel manufacturing facility network reduces feedstock supply risk, does not burden local water supplies and provides for broader based economic development. Each advanced biofuel manufacturing facility operating in Louisiana will produce no less than 5 million gallons of advanced biofuel per year and no more than 15 million gallons of advanced biofuel per year.
(3) Market Expansion
Advanced biofuel supply and demand shall be expanded beyond the 10% blend market by blending fuel-grade anhydrous ethanol with gasoline at the gas station pump. Variable blending pumps, directly installed and operated at local gas stations by a qualified small advanced biofuel manufacturing facility, shall offer the consumer a less expensive substitute for unleaded gasoline in the form of E10, E20, E30 and E85.
Pilot Programs
(1) Advanced Biofuel Variable Blending Pumps - The blending of fuels with advanced biofuel percentages between 10 percent and 85 percent will be permitted on a trial basis until January 1, 2012. During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the equipment used to dispense the ethanol blends to ascertain that the equipment is suitable and capable of producing an accurate measurement.
(2) Hydrous Ethanol - The use of hydrous ethanol blends of E10, E20, E30 and E85 in motor vehicles specifically selected for test purposes will be permitted on a trial basis until January 1, 2012. During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the performance of the motor vehicles. The hydrous blends will be tested for blend optimization with respect to fuel consumption and engine emissions. Preliminary tests conducted in Europe have proven that the use of hydrous ethanol, which eliminates the need for the hydrous-to-anhydrous dehydration processing step, results in an energy savings of between ten percent and forty-five percent during processing, a four percent product volume increase, higher mileage per gallon, a cleaner engine interior, and a reduction in greenhouse gas emissions.
Act No. 382, entitled “The Advanced Biofuel Industry Development Initiative,” was co-authored by 27 members of the Legislature. The original bill was drafted by Renergie, Inc. Representative Jonathan W. Perry (R - District 47), with the support of Senator Nick Gautreaux (D - District 26), was the primary author of the bill. Reflecting on the signing of Act No. 382 into law, Brian J. Donovan, CEO of Renergie, Inc. said, “I am pleased that the legislature and governor of the great State of Louisiana have chosen to lead the nation in moving ethanol beyond being just a blending component in gasoline to a fuel that is more economical, cleaner, renewable, and more efficient than unleaded gasoline. The two pilot programs, providing for an advanced biofuel variable blending pump trial and a hydrous ethanol trial, established by the State of Louisiana should be adopted by each and every state in our country.”
State Agencies Must Purchase or Lease Vehicles That Use Alternative Fuels
Louisiana’s Advanced Biofuel Industry Development Initiative further states, “The commissioner of administration shall not purchase or lease any motor vehicle for use by any state agency unless that vehicle is capable of and equipped for using an alternative fuel that results in lower emissions of oxides of nitrogen, volatile organic compounds, carbon monoxide, or particulates or any combination thereof that meet or exceed federal Clean Air Act standards.”
Advanced Biofuel Price Preference for State Agencies
Louisiana’s Advanced Biofuel Industry Development Initiative provides that a governmental body, state educational institution, or instrumentality of the state that performs essential governmental functions on a statewide or local basis is entitled to purchase E20, E30 or E85 advanced biofuel at a price equal to fifteen percent (15%) less per gallon than the price of unleaded gasoline for use in any motor vehicle.
Economic Benefits
The development of an advanced biofuel industry will help rebuild the local and regional economies devastated as a result of hurricanes Katrina and Rita by providing:
(1) increased value to the feedstock crops which will benefit local farmers and provide more revenue to the local community;
(2) increased investments in plants and equipment which will stimulate the local economy by providing construction jobs initially and the chance for full-time employment after the plant is completed;
(3) secondary employment as associated industries develop due to plant co-products becoming available at a competitive price; and
(4) increased local and state revenues collected from plant operations will stimulate local and state tax revenues and provide funds for improvements to the community and to the region.
“Representative Perry and Senator Gautreaux have worked tirelessly to craft comprehensive advanced biofuel legislation which will maximize rural development, benefit consumers, farmers and gas station owners while also protecting the environment and reducing the burden on local water supplies,” said Donovan. “Representative Perry, Senator Gautreaux, and Dr. Strain, Commissioner of the Louisiana Department of Agriculture and Forestry, should be praised for their leadership on this issue.”
About Renergie
Renergie was formed on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita. Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol. Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program. Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is more economical, cleaner, renewable, and more efficient than unleaded gasoline. Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.