Ethanol battle continues into fall

Source: By Gene Lucht Iowa Farmer Today • Posted: Thursday, September 12, 2013

Ethanol proponents are fighting back this summer and fall against what they see as unfair and inaccurate criticisms of their industry.

“A lot has happened in the past several weeks,” says Bob Dineen, president and CEO of the Renewable Fuels Association.

Dineen says oil industry representatives have been waging a campaign against the Renewable Fuels Standard (RFS) for some time, and they have stepped up that campaign this summer.

But, he says after congressional hearings on the subject were held in July, the price of gasoline rose and the price for RINS (renewable identification numbers) dropped significantly.

Those RIN prices were over $1.10 in July, but fell to an average of 75 cents since then, Dineen says, suggesting the market for RINS is “opaque” and “thinly traded.”

Also, he says there have been advances this summer on the cellulosic ethanol front. He noted a new plant opening in Florida that will use wood pulp and also mentioned work that started recently at Quad County Processors in Galva.

That Galva project is called ACE, for adding cellulosic ethanol, says Delayne Johnson, general manager of the facility.

It is aimed at using more of the corn kernel, adding more corn oil to the final product and producing some cellulosic ethanol.

Johnson, though, stresses keeping the RFS is important to cellulosic projects, such as the one happening at his plant because it adds certainty to the market and makes it easier to get financing for expansion projects.

Still, Dineen says he expects the attacks on ethanol to continue.

Tom Buis, CEO of Growth Energy, says it is likely there will be hearings in Congress again this fall as lawmakers look at the RFS. But, he says the push against the RFS isn’t about the consumer.

“It’s clearly about market share,” Buis says, adding opponents didn’t bother to attack ethanol until they began to see it as a threat to their market share in the fuel market.

“This is not a fight about the quality of the product,” he says. “This is a fight about market share.”