EPA raises ethanol goal

Source: Cody Winchester • Argus Leader  • Posted: Monday, January 2, 2012

The federal government has set its target for biofuels production in 2012, increasing by 1.25 billion gallons the amount of ethanol and biofuels that must be blended into the fuel supply.

Fuel providers will be required to blend 15.2 billion gallons of renewable fuel into the fuel supply in 2012. This includes 8.65 million gallons of cellulosic biofuels, up from 6.6 million gallons in 2011.

Cellulosic ethanol is extracted from cellulose, the fibrous structure of a plant, so it can be made from crop waste and non-food crops such as switchgrass. It’s more difficult and expensive to produce than corn ethanol, however, and none was produced commercially in 2011.

The EPA’s final rulemaking mentions Sioux Falls-based Poet’s commercial-scale cellulosic project in Iowa as a potential source of the fuel at some point in the future. The 25-million-gallon-per-year plant, Project Liberty, is scheduled for completion in 2013.

Project Liberty Director Jim Sturdevant said in a written statement that the renewable fuel standard “outlines a path toward greater diversity in our fuel supply” and provides certainty for investors in next-generation biofuel technology.

“It’s important to let the market develop at a reasonable pace rather than waiting for an energy crisis,” he said. “The Renewable Fuel Standard sets that pace.”

With the failure to renew a tax credit that had been paid to fuel blenders who buy ethanol, the ethanol industry has focused its attention on preserving the annual mandate.

Tom Buis, CEO of the trade group Growth Energy — whose board members include Poet CEO Jeff Broin — said the fuel standard “sets up some pretty important foundations, I think, not only for our economic stability but to reduce our dependence on foreign oil.

“We want to make sure that policymakers don’t, just because of some political expediency, or because it’s their fad of the season for political purposes, to try and make changes just at the moment when investment is starting to flow and some great innovations are coming online,” he said.