Balance Needed in Meeting Transportation Fuel Challenges of the Future

Source: By Ernie Shea, 25x25 • Posted: Monday, February 27, 2017

As it does every year, the National Ethanol Conference this week in San Diego generated a considerable amount of policy discussion. Highlighting that talk was the arrival of a letter from President Trump reiterating his strong support for ethanol and the Renewable Fuel Standard (RFS).

While ethanol industry leaders have insisted since the election that Trump will stay committed to campaign promises he made in Iowa early in the campaign to support ethanol and the RFS, that confidence was somewhat shaken within the sector after the president nominated several high-profile RFS critics to his cabinet and White House staff.

But there was a collective sigh of relief from those in San Diego this week, as Renewable Fuels Association President and CEO Bob Dinneen read to the conference Trump’s letter, which stated: “Rest assured that your president and this administration values the importance of renewable fuels to America’s economy and to our energy independence. As I emphasized throughout my campaign, renewable fuels are essential to America’s energy strategy.”

The missive offers some certainty to the future of biofuels as a significant element in the nation’s transportation fuel supply. Still, some concerns remain, as were expressed in other discussions coming out of San Diego about the growth rate of electric vehicles (EVs) in the U.S. market and the future implications that this growth could have on both the biofuels and oil industries.

In addition to the transportation fuel policy discussions in San Diego, there have also been increasing calls from the nation’s automakers for the new administration to revisit the Corporate Average Fuel Economy (CAFE) standards. One of the last acts of the Obama administration was to give final approval of standards that call for light duty cars and trucks to achieve, on average, 51.4 miles per gallon by 2025, despite industry claims that the standards could prove unrealistic and require further review of current and future technologies.

At the heart of all of these discussions, is the basic challenge for those in the transportation fuel and auto industries to best meet the desire from a growing consumer market for diverse, efficient, dependable, cost-saving means of mobility. It’s important for policy makers to understand that when facing choices, rarely is there a “silver bullet.” Those interests touting single solutions (EVs or reverting to 100 percent petroleum gasoline, as examples), need to remember that consumers want choices.

There are vehicles available to meet a wide variety of personal preferences, whether they be electric vehicles, hybrid (fuel and electric) vehicles, flex-fuel vehicles and, as seen in recent times of low oil prices, larger vehicles like full-size trucks and SUVs. But they all must meet the demands of consumers driven by economic considerations, the need for long-term reliability and the pursuit of a reduced environmental footprint.

Automakers and fuel providers need increased clarity on the long-term objective so they can design solutions to meet these targets. Going forward, these market demand forces will become increasingly more important. Attention needs to be paid to what consumers are looking for – flexibility, choice, efficiency and, yes, cleaner vehicles.

While some in the policy debate are dismissive of some pathways (the oil industry has made its objections to EVs fairly clear), a better way forward is to embrace a pathway that provides the benefit of efficiency without imposing a single “solution” for everyone.

From its origins, the 25x’5 Alliance has held that renewable energy is part of a mix of sources needed in the decades to come to power our cars, trucks, planes, homes, businesses and industries. Fossil fuels will be a constant in our energy future through much of this century. The role of policy makers and stakeholders must be to find the right balance of all resources that meet the energy, economic and environmental challenges ahead.

One course of action being touted by biofuel advocates and the auto industry is to put more focus on the composition of fuels to best deliver on the engine technologies that can best meet fuel efficiency and greenhouse gas (GHG) emissions standards in the decades to come. By putting greater emphasis on how, and what types of fuels the engines of cars and light trucks can burn best, regulators will ensure consumers that they are using more efficient, more economic and more environmentally friendly transportation fuels.

While technology is still emerging, we know that high-octane, low-carbon (HOLC) fuels – particularly those that contain blends of ethanol in the 25-30-percent range – represent an important pathway to meeting future goals. The research from DOE’s national laboratories makes very clear that major engine-efficiency and emission-reduction benefits can be derived from midrange, ethanol-blend, HOLC fuels. The combination of HOLC fuels and higher compression engines can enable a compliance pathway that is much more cost-effective than many other more expensive and complex technologies.

We urge policy makers and regulators to take a more universal look and find realistic solutions to the nation’s transportation fuel challenges of the future. Those solutions, including HOLC ethanol-blend fuels, can best serve to boost the economy, enhance our energy security and improve the quality of our air.