WBIA BLOG

Oil Rigged – Big Oil is misleading America

 

“Ethanol is the lowest cost transportation fuel in the world.”

 

Bold words this morning from the President and CEO of the Renewable Fuels Association, Bob Dinneen. But, it’s true! Ethanol has proven to be one of our best options for powering our Nation and moving America forward – which is exactly why Big Oil has been stacking the deck against ethanol blends for years.

Today, the national ethanol advocacy group, Fuels America is launching a nationwide campaign to draw attention to the many ways Big Oil is using misinformation to skew public opinion and convince our lawmakers that oil is the way to go.

In fact, according to the Center for Responsive Politics, the oil industry has spent $885 million on lobbyists and campaign contributions to our legislators in the past five years…

That’s more than $1 million for each and every single member of Congress.

Big Oil has been rigging the system for far too long. Help us stop the misinformation! Take a look at OilRigged.com and together we can keep moving America forward.

 

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Producers rail against changes to ethanol requirements

Many are frustrated Walker hasn’t weighed in on issue

By Rick Barrett of the Journal Sentinel
Jan. 15, 2014

Follow @JournalSentinel on Twitter

 

Wisconsin biofuel producers say they’re disappointed Gov. Scott Walker hasn’t joined a group of Midwestern governors urging the federal government to support ethanol use and not cut the fuel additive requirement in gasoline.

Long considered a boon to the Midwest economy, ethanol made from corn is blended in most of the gasoline sold in the U.S. today.

But for the first time since 2007, the U.S. Environmental Protection Agency has proposed cutting by 3 billion gallons, or almost 18%, the amount of ethanol in the U.S. fuel supply this year.

The reduction could have a huge adverse effect on corn growers and ethanol plants, said Robert Sather, co-founder of Ace Ethanol in Stanley and president of the Wisconsin Bio Industry Alliance.

“We have nine ethanol plants in the state. They will all be in jeopardy if the EPA change comes to fruition,” Sather said.

The proposal has raised the ire of Iowa Gov. Terry Branstad, a Republican, and governors from Illinois, Kansas, Michigan, Minnesota, Nebraska, North Dakota and South Dakota, who want the EPA to leave the biofuel requirements intact.

If the EPA’s proposed rule takes effect, the negative impact would be felt most in rural America, the governors said in a letter to EPA Administrator Gina McCarthy and Agriculture Secretary Tom Vilsack.

The governors said more than 400,000 Americans depend on renewable fuels for jobs in their states, directly or indirectly. They cited an Iowa State University study that estimated a reduction in the Renewable Fuels Standard could cause corn prices to drop below the point where farmers would make a profit on the commodity.

Corn is Wisconsin’s biggest crop, and farmers make planting decisions based in part on the demand for ethanol. So Wisconsin ethanol producers say they’re frustrated by Walker’s decision not join the other governors in urging the EPA to reject any reduction in the Renewable Fuels Standard.

Walker says he’s keeping a campaign pledge to not take a position in the debate that has pitted ethanol producers against Wisconsin’s small-engine industry, which opposes increased use of the fuel additive.

Livestock farmers also aren’t pleased with ethanol because it drives up the price of corn and makes their feed more expensive.

“From our standpoint, it’s a careful balance. We’ve got corn producers, but we also have (corn) users, particularly in the dairy industry,” Walker said in an interview.

The EPA was supposed to make its decision on the 2014 ethanol requirements last November but missed the deadline and has kept its public comment period open until Jan. 28.

“If there ever was a time the industry wanted the governor to get involved and weigh in, now is that time,” said Josh Morby, executive director of the Wisconsin Bio Industry Alliance.

(Follow Joshua on LinkedInTwitter, and make sure to follow the WBIA.)

 

In a speech to EPA officials in November, Iowa’s Branstad said by lowering the nation’s ethanol blending mandate, President Barack Obama’s administration would be turning its back on Iowa voters.

Iowa is the nation’s largest ethanol producer with 42 refineries.

“This is going to drive us into what could be another farm crisis. It makes no sense,” Branstad said.

Ethanol critics say the recent boom in domestic oil production has made the biofuel additive less important as an alternative to foreign oil.

Also, as vehicles become more fuel efficient, Americans are using less gasoline than they did seven years ago when the government set the Renewable Fuels Standard.

Almost all gasoline sold in the U.S. contains 10% ethanol.

“We are now at the E-10 blend wall,” the agency said, adding that if gasoline use continues to decline with more fuel-efficient vehicles, then growth in ethanol use would have to come from higher blends ranging from 15% to 85%.

That would be unpopular with the automotive industry and small-engine makers, who contend the higher blends could result in problems such as premature engine wear, fuel line issues and lower fuel mileage.

It’s time to scale back the Renewable Fuels Standard to better reflect the current situation, the American Petroleum Institute says.

“The Renewable Fuels Standard was a well-intentioned law that was written in 2007, when the assumptions of what 2014 would look like were vastly different,” said Patrick Kelly, API’s senior fuels policy adviser.

“Now the EPA has taken steps in the right direction to address this,” Kelly said.

 

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Wisconsin company advances in US Air Force renewable fuel testing

A Madison based company has developed a renewable jet fuel which has recently received the green light after the first round of testing  by the US Air Force.

The one hundred percent renewable fuel produced by Virent was recently tested at US Air Force Laboratory as a result of a strong push by the Pentagon to depend less of foreign fuels. The chemical conversion process which Virent uses to produce its biofuel was developed in the labs of the University of Wisconsin-Madison. Aaron Imrie, Virent’s commercial fuels manager, expressed his excitement over the results from US Air Force by stating:

“These ARFL results are exciting because they demonstrate the potential of Virent’s catalytic process to create renewable plant-based jet fuel that can meet or exceed petroleum.”

Earlier this year, the US Air Force completed a test flight using a 50-50 blend of petroleum and a biofuel derived from camelina. Honeywell also announced this summer the first successful trans-Atlantic flight using the same biofuel-petroleum blend.

To read more about Virent’s biofuel success, click here.

Or, to learn about Virent, click here.

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Ag. Secretary Tom Vilsack at Wisconsin State Fair on biofuels

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WBIA staffer Cara McCarthy on ethanol

Cara McCarthy on ethanol

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Coburn pushes Senate vote on anti-ethanol measure

Claiming to be an effort to reign in federal subsidies, Senator Coburn (R-OK) and his fellow anti-ethanol legislators snuck in an amendment to end investment in America’s ethanol industry. A closer look at the motives of Sen. Coburn and his Senate allies reveal they are covered in oil.

Over the last years, Sen. Coburn and his colleagues have received more $4 million in political contributions from the oil and gas industry. Although large contributions from oil companies are no secret, this amendment does show that there is more behind the amendment than simply cutting federal subsidies. As Matt Hartwig from the Renewable Fuels Associates suggests:

“This effort has more to do with oil-patch politics than it does national energy security and responsible fiscal policy.  If this were a true effort to reign in federal energy subsidies, than the tens of billions of dollars given to mature energy industries like petroleum would be included in this amendment.”

This amendment is a ploy to keep Americans at the mercy of foreign oil and rising prices while a select few reap the political and monetary benefits.  Killing ethanol investment would also mean snuffing innovation and stifling growth that can bring prosperity to many Americans.

To read more about Sen. Coburn’s amendment, click here.

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Restructuring of VEETC

Earlier this week Rachel Gantz, a reporter at OPIS, was the first to break the news story about whats happening at the national level as it relates to our industries efforts to restructure VEETC. The WBIA is excited to be able to be part of these discussions and work closely with our friends across the county.  The WBIA and our members have been in contact with members of our congressional delegation such as Congressmen Ron Kind and Reed Ribble and Senator Herb Kohl as recently as this week to educate them about the importance of the ethanol industry and the ideas we have about the importance of a tax credit.

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Letter to Secretary Vilsack on USDA Corn Demand Reporting

Dear Secretary Vilsack:

As the price of corn rises due to a number of environmental and societal factors, opponents of domestically produced biofuels have once again begun to engage in the unfounded “food vs. fuel” attacks that have harmed the industry over the past several years.

Indirectly contributing to the problem is the fact that the US Department of Agriculture provides the monthly “corn demand for ethanol” without specifying that some of that corn is used for ethanol production, while more than one-third is resold as dried distillers grains. In doing so, the USDA is not accurately presenting the amount of corn that is converted directly into ethanol, but rather inflating the amount by including co-products in the overall demand figures.

If the ethanol industry it to continue to fight “food vs. fuel” claims, it is imperative that we articulate the entirety of the ethanol production process, which includes not just the production of fuel, but high-quality animal feed and other co-products as well. By altering its reporting methods, the USDA would be able to provide a more accurate portrayal of corn demand for ethanol and eliminate one false route of attack for those who are anti-ethanol.

In Wisconsin, our plants combined produce more than 500 million gallons of ethanol per year, contributing billions of dollars to our state economy and employing thousands of people across the state. Throughout your time as Governor of Iowa and as Agriculture Secretary, you have been an outspoken advocate of ethanol and the biofuel industry in general, and we thank you for your continued support.

We hope that you will consider revising USDA reporting methods and helping us counter the false claims that ethanol forces us to sacrifice food for fuel, and we look forward to working with you in the coming years to continue growing our industry across the country.

Sincerely,

Western Wisconsin Energy
Didion Ethanol
Ace Ethanol
Badger State Ethanol
Marquis Energy

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WBIA President Bob Sather Voices Support for Ethanol Tax Credits

WBIA President Bob Sather recently wrote the follwoing letter to the editor to the Eau Claire Leader-Telegram in response to a recent editorial they ran calling for the end of ethanol subsidies.

To the Editor:

In its editorial page on National View “End costly ethanol subsidies,” the article failed to provide its readers any context, mislead them about the nature of U.S. ethanol production and offered no alternative to replace America’s addiction to oil. The amount of ethanol produced nationally last year was about equal to the amount of oil this country imported from Saudi Arabia. A study by Merrill Lynch cites that gasoline would be about $35 cents more without ethanol as a product in the motor fuel supply.

First, calling for an end to tax credits for ethanol while ignoring the billions of PERMANENT tax subsidies for Big Oil (the World Bank cites $500 billion last year) is as inequitable as it is shortsighted. Despite all members of Congress wanting more renewable energy technologies, they come before Congress with hat in hand for high risk investment. The oil industry, by comparison, only lobbies when the permanent subsidies it enjoys are threatened.

Second, American ethanol is a success story. Only lamenting the value of the tax credit for ethanol without discussing the economic benefits ethanol is misleading. For example, federal tax revenue generated by the production of ethanol and use of ethanol totaled more than $8 billion in 2009, $3 billion more than the value of the tax credit. Jobs and economic opportunity delivered to hundreds of rural communities further add to the value of investment in domestic ethanol production.

Third, the article suggests there are better technologies available without providing any evidence. There is no gasoline alternative technology that can match ethanol’s availability, production volume, or oil displacement benefits. Moreover, continued investment in ethanol is required to ensure promising next generation biofuel technologies, such as cellulosic ethanol for commercialization. Ending investment in ethanol will result in more oil consumption and severely curtail investment in new renewable fuel technologies.

Accordingly, this is a question of priorities. If the goal of assumption of the article is a level energy playing field, then it should call for the elimination of all tax provisions benefitting every energy industry – oil, natural gas, coal, nuclear, wind, solar, etc. Finally, if the real priority is ending our addiction to oil, then eliminating the permanent tax breaks for Big Oil and investing those dollars in renewable fuel technologies should be our goal.

Bob Sather
Wisconsin Bio Industry Alliance
11010 161st Street
Chippewa Falls, WI 54729

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Stockholm Shows Us It Can Be Done

The world’s largest ethanol bus fleet is getting even bigger. Storstockholms Lokaltrafik (SL), the Stockholm regional transport company is adding 85 new ethanol powered buses to their fleet.

It’s part of an ambitious goal by SL’s owner, the Stockholm County Council, to use renewable fuels in at least 50 percent of all passenger transport by 2012.  They’re already well on their way to hitting their target, having reached nearly 30 percent already.

Stockholm is setting an excellent example for the rest of the world.  They are aiming big, and following through.  Their efforts show the rest of us that it can be done.

As the EPA stalls to increase the ethanol blend rate, other countries are advancing green technologies and reducing their carbon footprint. It’s time the U.S. pushes forward with the same dedication that has been shown in Stockholm.

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