U.S. ethanol industry frets over Washington green fuels study

Source: Don Jenkins, Capital AG Press • Posted: Monday, November 17, 2014

A consultant says ethanol made from Brazilian sugarcane could help Washington reduce carbon emissions.

Midwest ethanol producers are lobbying Washington Gov. Jay Inslee to not adopt a low carbon fuels standard.

An industry advocacy group, Growth Energy, last week sent a letter to Inslee’s administration warning that a “California-style” policy would have slight environmental benefit.

The letter responded to a recently released state-commissioned study that said U.S. corn ethanol has roughly twice the carbon footprint as ethanol made from Brazilian sugarcane.

The study assumes sugarcane ethanol would help Washington reduce greenhouse gases from vehicles. Meanwhile, consumption of corn ethanol, currently the state’s main alternative fuel source, may recede.

California’s low carbon fuels standard, adopted in 2007, assigns a high “carbon intensity” to Midwest corn ethanol.

Chris Bliley, Growth Energy’s director of regulatory affairs, said in the letter to the governor’s budget office that individual state mandates merely lead to ethanol being consumed elsewhere.

“Ethanol to which California has assigned a high carbon-intensity score may not be sold in California, but it is sold elsewhere,” Bliley wrote. “To date there has been no net reduction in (carbon) emissions nationwide; the only impact has been ‘fuel shuffling,’ a resulting phenomenon which itself is likely to increase (carbon) emissions by requiring the transport of ethanol and other fuels further distances.”

Inslee has made reducing greenhouse gases a top priority for his administration. The transportation sector emits almost half of the state’s greenhouse gases.

A low carbon fuel standard would face an uphill climb in the Legislature, but Inslee maintains he has the authority to adopt one through a rule-making process.

He and his staff will review the study, Inslee spokeswoman Jaime Smith said. No decision has been about whether to propose a rule, she said.

The study, conducted by Life Cycle Associates of Portola, Calif., looked at various scenarios to cut by 10 percent carbon emissions linked to vehicle fuels by 2026.

Carbon intensity attempts to measure all greenhouse gases emitted in producing, transporting and consuming a fuel. The carbon intensity score increases if the fuel source displaces food crops and leads to more land being cultivated.

Bliley said penalizing corn ethanol for land-use changes unfairly diminishes its environmental value.

“Ethanol continues to significantly lower greenhouse gas emissions in our transportation fuel,” he wrote.

Tagging corn ethanol as carbon intensive has national implications too, according to Bliley. “Oftentimes domestically produced corn ethanol is excluded from a particular state market, while gallons of cane ethanol primarily produced in Brazil are exported thousands of miles.”

According to Life Cycle’s study, gasoline and diesel each have carbon intensities of around 100. Midwest corn ethanol was rated at 89, while Brazilian sugarcane ethanol scored a 43.

Brazilian sugarcane scored better than Midwest corn primarily because sugarcane ethanol plants generate their own electricity, plus a surplus, said Jim Cahill, senior budget assistant to the governor.

The Brazilian plants use bagasse, a fiber left over after crushing sugarcane, to generate electricity, he said.

Manufacturers send excess energy to the grid, earning credits for reducing the need to generate other forms of electricity, Cahill said.

Geoff Cooper, senior vice president of the Renewable Fuels Association, said the report overstated how much natural gas and other forms of energy corn farmers and Midwest ethanol plants use.

“I think what we read in the Washington report was an acceptance of the California mindset and California way of thinking,” he said. “It’s absurd to believe ethanol imported from Brazil is twice as clean as ethanol produced in the Midwest.”

Life Cycle referred questions to the governor’s office.

Cooper said the association supports a national low carbon fuels standard and a uniform method for measuring carbon intensity.

Oregon in 2009 adopted a low carbon fuel standard, which will expire in 2015 unless extended by lawmakers.

Cooper said that if the West Coast shuts out the Midwest ethanol industry, fuel production may decline or more ethanol may be exported, possibly to Brazil.

“You’ve got all these dislocations of ethanol going on simply because of state programs, and the net reduction of greenhouse gases is nil,” he said.

Cellulosic fuels, made from non-food biomass, have an estimated carbon intensity of only 15. The report noted Washington has large amounts of wheat straw and forest residue that could be converted into fuels, but only if government rules assured there were buyers and that companies could be profitable.

Cellulosic fuels have been slow to develop. The U.S. Environmental Protection Agency projected 1 billion gallons of cellulosic fuels would be produced in the U.S. by 2013. The number was revised downward to 810,000 gallons because of production shortfalls.

Life Cycle estimates a low carbon fuel standard would add about a dime a gallon to gasoline and diesel by 2026. Critics say prices will increase by more.

Todd Myers, the environmental director of the conservative Washington Policy Center, said the report acknowledges cellulosic fuels need public subsidies, which he said contradicts claims that consumers won’t feel the pinch.