Trade and rural revitalization were the key topics that Agriculture Secretary Tom Vilsack addressed in his the keynote speech at the 2010 Commodity Classic on Friday – but at the press conference it was anything goes.
During his speech, Vilsack talked about the importance of biotechnology and biofuels, especially stressing the economic impact projected for 2022 if we meet the Renewable Fuel Standard. “190,000 people will be employed in the biofuels industry and if you leverage all the indirect jobs it will be closer to 807,000 jobs,” Vilsack said. In addition, $95 billion will be invested in the expansion of the biofuels industry over the next 12 years. “Most importantly, it will prevent us from having to import $350 billion of foreign oil,” he added.
The speech was fine, but the Secretary’s press conference was much more interesting. In fact, it was the longest and most candid press conference I have seen with him yet. Questions ranged from Toyota versus US beef, to calling USDA the Department of Food, to whether E15 will be approved.
Last week, the EPA announced a delay in the decision on increasing the blend level to E15 until the end of the summer. Vilsack commented that the purpose of the delay is due to ongoing testing by the Department of Energy to determine what engines can use the higher blend without ill effects. It has already been established that newer vehicles, and all flex-fuel vehicles can use the higher blend safely, “Which suggests to me that we’re going to see an increase in the blend rate,” said Vilsack. He then noted that it will be important to use rural development resources to make sure the distribution systems create the opportunities for people to use higher blends.
Listen to Vilsack’s comments about E15 here:
Download his comments with this link: Vilsack comments on E15
South Dakota Corn Grower, Darrin Ihnen, President of the National Corn Growers Association, took the general session stage this morning at Commodity Classic with session moderator Mark Mayfield.
Mark had a list of questions for each of the commodity group leaders and Darrin got to go first. With Darrin he started out talking about ethanol. Darrin talked about what the corn growers are doing in this area including pushing for higher blends in the fuel supply. All indications are that this is progressing in a positive way with the science looking good. He says they’re hoping for action by the end of this summer.
If you’ve sort of forgotten about domestic ethanol as an alternative to imported gasoline, be assured that Tom Stephens hasn’t.
Stephens, who was in Orlando recently to speak at the National Ethanol Conference, is vice chairman of global product operations for General Motors. He knows as well as anybody that our gasoline supply won’t last forever, and we’re long past the point where we should be concentrating our efforts on weaning the U.S. from our dependence on oil. GM has lived by that philosophy and has been the automotive leader in offering up flexible fuel vehicles that run on gasoline, E85 or any gasoline-ethanol combo in between.
Despite all their efforts, those by NCGA and many others, there are only 7.5 million E85 capable FFV’s in operation today and 2,000 stations offering up the corn-based, eco-friendly fuel. Surely nothing to sneeze at but given our voracious appetite for gasoline in the U.S. we have plenty of room for improvement.
With that sobering assessment, let’s take a look at some signs of what the future might hold. The U.S. Department Energy projections say ethanol production is on the rise and we will make 800,000 barrels a day in 2010, up from 700,000 last year. Another 50,000 barrels a day will be added in 2011. The trend seems to document the buzz in the industry that ethanol makers are recovering from the sluggish economic conditions that have plagued every industry.
That’s a good thing considering the ethanol industry added $53 billion to the U.S. gross domestic product and $16 billion in U.S. household income last year even as the ethanol industry struggled. (more…)
Recently, a nation starved for domestic energy supplies and sources, has managed to lose its way in the deep dark forest of the unknown that is the speculative science of indirect land use change. In typical American fashion – or at least this seems to be the new norm – we have missed the point, evaded the crux of the issue and been distracted by ne’re-do-wells with questionable motives.
So in the name of refocusing the energy debate, I offer up the bold statement that ethanol fuel is a slam dunk when it comes to offering a real solution. First, it is here today, not on a drawing board or in a lab and it helps us achieve many of our critical goals such as providing jobs, making us less dependent on foreign oil from often hostile sources, and it pollutes less than gasoline during its manufacture and use. And as a bonus, with biofuels like ethanol we also get a product that is renewable. Anything that directs our focus away from these fundamental truths should be looked at with a skeptical eye.
There appears to be some evidence that rational thinking is not dead and more and more people are beginning to understand the fallacies and foibles of the concept of indirect land use. Historical trends indicate that increased U.S. ethanol demand has not been a significant driver of land use change. Increased crop productivity (growing more on the same amount of land) has primarily provided the growth in production necessary to meet heightened demand. But if history has shown us one thing it is that critics of ethanol will not go gently into that good night.
The next issue can already be seen on the horizon and it can be seen clearly because it is not a “new” criticism. It is called the Volumetric Ethanol Excise Tax Credit (VEETC). This is the incentive put in place to encourage gasoline marketers to blend 10% ethanol in a gallon of gasoline. It is the carrot that got the entrenched oil industry to rethink their century old product mix and make it better. (more…)
The entertainment during a reception at the Renewable Fuels Association National Ethanol Conference last week came up with some new lyrics to an old Pink Floyd song that hits on the blend wall facing the nation’s ethanol producers.
The group, made up of three ethanol industry executives, is called “Green Floyd” and the parody lyrics to the other Floyd’s “The Wall” include references to EPA administrator Lisa Jackson, the waiver to allow up to 15 percent ethanol in regular gasoline, RFA president and CEO Bob Dinneen and the blend wall faced by the industry if the allowable blend is not increased.
With credit to Frontline Bioenergy CEO Bill Lee, Neil Koehler with Pacific Ethanol and bioenergy consultant Paul Kamp, here are the lyrics to “The Blend Wall” (to the tune of Pink Floyd’s “The Wall”) and a short video clip to enjoy.
We don’t need o-ver production
We could use some E-15
Lisa Jackson, approve our waiver
Listen to our man, Dinneen
Hey, Lisa –
Listen to Bob Dinneen!
All in all it’s just another wicked Blend Wall
All in all it’s just another wicked Blend Wall
The new rule for the expanded Renewable Fuel Standard, or RFS2, represents the first time the federal government has ever had to develop regulations based on the unproven theory of international indirect land use change. This is kind of like trying to make a recipe without knowing the ingredients.
EPA’s Transportation and Regional Programs Division Director Sarah Dunham talked about how they did that during a presentation at the National Ethanol Conference this week.
She said that having to incorporate indirect land use change into the rule “contributed to the evolution of the science in this year. There’s no question the science evolved significantly over the last year through this process and will continue to evolve going forward.” However, she added, “Just because we issued a final rule doesn’t mean that it’s done, it’s just the first step in moving forward with this.”
In other words, they’re not sure whether this first recipe they have put together will be a cake or a mistake. It still needs more testing in the kitchen because of what they call “inherent uncertainty.”
“There is inherent uncertainty in these assessments,” Dunham said. “And we thought it was important to try to formally recognize that uncertainty” and incorporate it into the analysis. The National Academy of Sciences has been asked to do a review of the whole lifecycle assessment and indirect land use change component and report back in two years.
I would call this inherent insanity. Why in the world would our federal government try to regulate something based on a half-baked theory and uncertain projections? It makes no sense at all. It would make much more sense to throw out the entire indirect land use change modeling effort until the science is fully evolved, not just partially.
A recent online New York Times editorial praised the Environmental Protection Agency’s decision supporting the expansion of biofuels production however, the praise was too lavish, according to many close to the issue.
As seems to be more and more common in government, EPA’s attempts to mollify all parties involved, resulted in a watered-down decision that missed the mark. The source of the EPA and NY Times gaff is their inability to expose the Indirect Land Use Change (ILUC) argument for the red herring it really represents.
For those unfamiliar with the concept a “red herring” is a deliberate attempt to divert or deflects attention away from the real subject at hand, and ILUC proponents deserve a nod for their adept sleight of hand regarding the future of biofuels. Instead of focusing on the documented economic, environmental, and energy contributions of biofuels, we find ourselves debating the tenuous connection between America’s production of corn and land use impacts in sovereign countries elsewhere in the world.
According to the Renewable Fuels Association, these so-called indirect land use impacts have questionable scientific validity. In fact, more than 100 scientists and Ph.D.’s have stated: “The ability to predict this alleged effect depends on using an economic model to predict worldwide carbon effects, and the outcomes are unusually sensitive to the assumptions made by the researchers conducting the model runs. In addition, this field of science is in its nascent stage, is controversial in much of the scientific community, and is only being enforced against biofuels.”
That’s RFA’s way of saying a lot reasonable and reputable folks don’t trust the subjective nature of computer modeling which is in its infancy, let alone using something as important as biofuels as the crash-test dummy for this new assumption rather than fact-based driven methodology.
Darrin Ihnen, president of the National Corn Growers Association, laid bare the biggest argument refuting ILUC in his response to the New York Times. “Upwardly trending corn yields disprove this theory. In 2009, for example, farmers grew enough corn to break 2007’s production record, and we did so harvesting nearly seven million fewer acres.”
In fact, corn growers have developed a new paradigm regarding the future of corn production. Scientists have unlocked the intricate corn genome and in doing so have set the stage for a national yield average of nearly 300 bushels per acre within two decades. Productive capacity is increasing so rapidly that the U.S. corn farmers has grown enough corn to meet the needs of all markets while biofuel production has soared.
Ihnen pointedly says “those who wrote the studies you cite should get out into the fields and talk to the many farmers who are not only beating the Department of Agriculture’s average corn yield, but also doubling it in some circumstances. They will see the great potential the Corn Belt has for feeding and fueling the world.”
Nobody ever forgets their first love, even if they turn out to be a dirty, rotten scoundrel.
For all of California’s big talk about going green, the truth is they just can’t forget their first love – Big Oil. This photo is of Signal Hill in Southern California back in 1923. The hill became part of the Long Beach Oil Field, one of the most productive oil fields in the world. Signal Hill was covered with over 100 oil derricks, and because of its prickly appearance at a distance became known as “Porcupine Hill”.
You would think that after EPA reconsidered ethanol’s environmental benefits when issuing the RFS2 rule that California would take a second look at the homegrown fuel and make it part of their Low Carbon Fuel Standard. But last week’s action by the Southern California Association of Governments turning down federal funding to put in dozens of E85 fueling stations showed just how much the state is still in love with oil. Paul Wuebben, a clean fuels officer for the South Coast Air Quality Management District, urged the council to accept the dollars. Ethanol is not perfect, he said, but its wider use would reduce dependence on gasoline and remove pollutants from the air. He also called the panel’s decision a “major lost opportunity for the region.”
Wuebben attempted to sway the panel to reconsider along with Mike Lewis with Pearson Fuels, “It would have created 221 jobs. Dependence on foreign oil is the result of 1,000 little decisions and a few big decisions. This was a big decision.”
California lawmakers and bureaucrats believe that corn-based ethanol causes more harm than good for the environment after being transported from the Midwest. One recent article penned by Roland Hwang, Transportation Program Director for Natural Resources Defense Council in San Francisco, calls it “old, dirty ethanol.” Seriously? If ethanol is old and dirty, what does that make oil?
That’s what Iowa Renewable Fuels Association Executive Director Monte Shaw said in his address at the 4th Annual Iowa Renewable Summit last week.
“Now, before I get fired please allow me to clarify,” he continued. “I do not believe that the production of ethanol and biodiesel in the US leads to the destruction of the Amazon rain forest. Quite the opposite.”
After looking at this year’s corn and soybean production records, I have come to the conclusion that the simply astounding productivity gains of the American farmer is changing the way we use land in the United States. After all, 2009’s record corn crop was produced on 7 million fewer acres than the year before. Those acres went somewhere!
Shaw points out that “renewable fuels production has never used a kernel of “baseline” commodity production. American farmers produce more commodities for food, feed, exports and other non-fuel uses than they did in 1980 – and on fewer acres. Yet while expanding these non-fuel markets, the yield gains provided enough “new” corn to also produce 10.6 billion gallons of ethanol in 2009.”
I believe better science will clear up the current indirect land use debate. Plant technology will continue to improve production efficiencies. Seed technology and better agronomic practices will continue to boost commodity yields at an increasing rate. In short, it won’t be long until corn ethanol achieves the scientific benchmarks of an advanced biofuel.
Corn ethanol saved the day for Betty Boop in a cartoon that was made in 1939.
John Voelcker at GreenCarReports.com uncovered this classic cartoon featuring the power of “corn dripp’ns” as a fuel for Betty’s roadster in “Musical Mountaineers.” Little Miss Boop runs out of gas in hillbilly country and finds help from some musical mountaineers who get her on her way again by filling her tank with moonshine made from corn. Voelcker says, “Meanwhile, we can’t help but wonder if there was a nice little “Flex-Fuel” E85 Ethanol logo on the back of that roadster?”
During his speech, Vilsack talked about the importance of biotechnology and biofuels, especially stressing the economic impact projected for 2022 if we meet the Renewable Fuel Standard. “190,000 people will be employed in the biofuels industry and if you leverage all the indirect jobs it will be closer to 807,000 jobs,” Vilsack said. In addition, $95 billion will be invested in the expansion of the biofuels industry over the next 12 years. “Most importantly, it will prevent us from having to import $350 billion of foreign oil,” he added.
South Dakota Corn Grower, Darrin Ihnen, President of the 
The entertainment during a reception at the 
EPA’s Transportation and Regional Programs Division Director Sarah Dunham talked about how they did that during a presentation at the 
For all of California’s big talk about going green, the truth is they just can’t forget their first love – Big Oil. This photo is of 
That’s what 