Ethanol. Right. Now.

Americans back to spending $1 billion a day on gasoline

One billion dollars a day is an astronomical figure -- and it's the amount Americans are spending every single day to gas up their vehicles.  Tom Kloza, chief oil analyst at the Oil Price Information Service, told the New York Times recently ("High Gas Prices Could Slow Recovery") that in January, consumers were spending about $600 million per day on fuel for their vehicles, but now that figure is back up to around $1 billion per day.  The article says, "The national jump in prices, far larger than the normal seasonal increase, is pulling billions of dollars from the pockets of drivers. It threatens to curtail a modest recovery in consumer spending on items like apparel and electronics."

Oil and gasoline prices are on the way back up, and this underscores the importance of having a cost-effective alternative like ethanol.  For example, the Nebraska Ethanol Board recently did an analysis that showed Nebraska drivers have already saved more than $4.5 million this year by choosing E10 at the pump.  And, they say, if all the fuel sold in the state in the past five years was E85, Nebraskans would have saved $2.6 billion. 

Let's not spend $1 billion a day on a non-renewable, often imported fuel.  Ethanol is a cost-effective, homegrown alternative that can keep money circulating in our nation's economy and give it the boost that it needs.  The EPA allowing up to 15 percent ethanol per gallon would be a good start.

President Obama: First generation biofuels must remain viable

In a letter this week to the Governors' Biofuels Coalition, President Barack Obama stated his support for ethanol, calling advanced renewable transportation fuels one of the nation's most important industries for the 21st century.

"Combined with improved energy efficiency, biofuels are the primary near-term option for insulating consumers against future oil price shocks and for lowering the transportation sector's carbon footprint," the President wrote.  "The direct consumer benefit has been well documented and producing and using more biofuels today means an immediate reduction in oil imports in addition to an immediate increase in domestic employment."

He writes that his Administration is committed to commercializing emerging cellulosic technologies, but that cellulosic ethanol will only become reality if today's corn-based ethanol remains viable.

"But this transition will be successful only if the first-generation biofuels industry remains viable in the near-term, and if we remove long-standing artificial barriers to market expansion necessary for large volumes of advanced renewable fuels to find a place in America's transportation fuels system," the President said.

The entire letter can be read here: http://www.ethanol.org/pdf/contentmgmt/POTUS_letter_to_GBC_52709.pdf

President Obama issues a biofuels directive, starts interagency work group and calls for peer review of GHG data

President Obama today issued a directive to USDA Secretary Tom Vilsack on the subject of biofuels and rural economic development, calling for a new Biofuels Interagency Working Group headed by the Ag and Energy Secretaries and the EPA Administrator.  Having the USDA, DOE, and EPA work together on biofuels issues makes a lot of sense.

In the memorandum, the President had a lot of good things to say about ethanol, including a citation of the 600,000 barrels of biofuels produced each day in the U.S. last year, as well as the jobs and tax revenues that are an important boost to the U.S. economy.  The President instructed USDA to, within 30 days, get Farm Bill programs moving that will help biofuels facilities reduce fossil fuel use and transition to advanced biofuels production.  This immediate assistance will be a positive for America's biofuel producers which have been struggling in today's tough economy as other industries have as well.

The discussion of the Presidential directive came in the same media conference call as the announcement of the proposed rulemaking for the Renewable Fuels Standard, which suggests that indirect greenhouse gas emissions be counted in biofuels' carbon tally.  Though ethanol supporters aren't happy to see that methodology in the proposed RFS rule, there was a ray of hope -- the Presidential directive calls for a peer review of the assumptions surrounding the carbon intensity of biofuels and of fossil fuels. 

Let's put this discussion back into the realm of science where it belongs so that fossil fuels can be subjected to the same scrutiny that biofuels have undergone.  If biofuels' indirect GHG emissions are to be counted, then so should those of fossil fuels.  The bottom line is that future sources of oil -- tar sands, oil shales, etc. -- are going to have serious consequences for the environment while future sources of biofuels are going to be even more environmentally friendly than they are today.

The American Coalition for Ethanol issued a full statement today which can be read here: http://www.ethanol.org/pdf/contentmgmt/ACE_praises_Presidents_biofuels_directive_5_5_09.pdf

Posted by KB, 5/5/09

Ethanol's under the microscope, and oil refinery bankruptcies go unnoticed

In a recent interview, Charlie Drevna of the National Petrochemical Refiners Association made this comment about today’s ethanol market: “With the failure of a number of ethanol facilities and even their corporate entities last year, it's becoming even more apparent that the RFS (Renewable Fuels Standard) never was a good policy to begin with, and that efforts to prop up those businesses with decades of federal subsidy were essentially for naught.”

Given the fact that a number of oil refineries have also recently declared bankruptcy, I wonder if Charlie thinks using gas in our cars is bad policy too?  What about the efforts to prop up those refiners by spending billions of unreimbursed defense dollars to get their oil products imported from the Middle East and other similarly bad places?  Frankly, that seems like an easier case to make.  If you’re looking for bad policy, how about the unwritten policy that sends hundreds of billions of hard-earned U.S. dollars to other countries to pay taxes and create jobs there rather than here?

But more importantly, some of you are thinking, “Refinery bankruptcies?  Huh?”  It’s true.  Refineries many times larger than even the largest ethanol producers have filed for Chapter 11 bankruptcy in the past few months, and many other refineries are cutting back production – yet we don’t read or hear a thing about it in the media. 

Posted by RL, 1/26/09

President-Elect calls for doubling of alternative energy

In a speech given today, President-Elect Obama called for dramatic increases in the production of alternative energy:

 

"To finally spark the creation of a clean energy economy, we will double the production of alternative energy in the next three years.  We will modernize more than 75% of federal buildings and improve the energy efficiency of two million American homes, saving consumers and taxpayers billions on our energy bills.  In the process, we will put Americans to work in new jobs that pay well and can’t be outsourced – jobs building solar panels and wind turbines; constructing fuel-efficient cars and buildings; and developing the new energy technologies that will lead to even more jobs, more savings, and a cleaner, safer planet in the bargain."

The full text of his remarks is available here: http://change.gov/newsroom/entry/dramatic_action/

President-Elect Obama's stimulus plan to support clean energy sources such as corn and advanced biofuel is exactly the bold and visionary strategy we need to help the U.S. economy recover in the short term, and to ensure long-term prosperity and security for our nation. Biofuels must play a meaningful part of the clean energy goals of the economic recovery package.

Posted by BJ, 1/8/09

Corn prices are down, yet food prices are still up

As families prepare for their annual Thanksgiving dinner this week, they may want to look to food processing companies for answers as to why their grocery bills will be higher than last year.

"When corn was nearly $8 per bushel this summer, food manufacturers began an expensive and dishonest PR campaign to convince Americans that food prices were high due to the demand for corn-based ethanol.  Now that corn prices are below $4 per bushel, and we're grinding even more corn for ethanol than earlier this year, these same food companies are proving that good prices are high because they want them to be high," said Brian Jennings of the American Coalition for Ethanol.

Companies such as General Mills, Del Monte, and ConAgra have all reported a double-digit increase in sales during the last quarter, partly due to price increases. 

An Associated Press article (http://www.google.com/hostednews/ap/article/ALeqM5i7bcgQyokxAYSLttY7nF6jtG8_CAD94JDBN00) had an interesting statement by Chief Executive William R. Johnson: he said "commodity costs are coming down and Heinz will leave pricing in place, which will help boost margins. Heinz will invest in marketing and innovation to push its message of value to consumers, he said. The company is also looking at changing sizes of packages and providing new offerings to keep consumers wanting its products."

Posted by KB 11/24/08

An action plan for automakers: higher blends, FFVs

Rep. Herseth Sandlin (D-SD) wrote a letter to Rep. Nancy Pelosi and Rep. Barney Frank this week, asking the House to consider federal assistance to the U.S. auto industry - including "serious and bold steps" in support of biofuels, which will help meet the twin challenges of energy independence and climate change.

The letter states that in order to access federal financing, U.S. automakers should:

• Redouble their commitment to meet or exceed fuel economy standards set for them by Congress;
• Agree not to place unfounded warranty objections in the way of the widespread adoption of mid-range ethanol blends like E15 for use in standard vehicles;
• Transform their aspirational goal for the production of flex-fuel vehicles -- 50% of production by 2012 -- to a hard and enforceable goal of reaching that level by 2012 or sooner.

It's time to move on to blends of ethanol beyond 10 percent, and these action steps would set the wheels in motion today.

Posted by KB, 11/20/08

New quarterly profits record: $14.83 billion for Exxon

ExxonMobil has announced a third quarter profit of $14.83 billion, another new record.  This is up from their second quarter profit of $11.68 billion, and up from last year's third quarter profit of $9.41 billion.  The company said its total revenue for the quarter was $137.7 billion, surpassing analysts' predictions by more than $6 billion.

Posted by KB, 11/6/08

Ethanol is part of the growth in "green" jobs

The U.S. Conference of Mayors released a report today saying that the transition to renewable energies and efficiencies could produce more than 4 million new "green" jobs in the U.S. in the next 30 years, saying it could be the fastest growing segment of the U.S. economy over the next several decades.  The report predicts that the biggest job gain will be in the area of alternative transportation fuels like ethanol. Ethanol is a growing part of the nation's fuel supply, and it looks like ethanol could also go a long way toward fueling the nation's economy as well.

 

The report is found at http://www.usmayors.org/pressreleases/uploads/GreenJobsReport.pdf