Vilsack outlines 3-pronged RFS, U.S. ethanol strategy Jeannine Otto, Field Editor

Source: Jeannine Otto, Field Editor, AgriNews • Posted: Thursday, April 3, 2014

JOLIET, Ill. — Defend, expand, export.

Tom Vilsack, U.S. secretary of agriculture, stood on the floor of a loading bay at The DeLong Co.’s Joliet container facility. Outside, grain trucks provided a steady hum as they waited in line to dump their loads of corn and dried distiller grains, outbound for overseas destinations.

The carefully swept floor still bore traces of the granular golden byproduct of ethanol production, and a hint of freshly baked sugar cookies, a trademark calling card of DDGS, hung in the chilly late-March air.

To ship dried distiller grains overseas, to unload those semis and fill the containers, means jobs, 15 of them at the DeLong Joliet facility.

To get dried distiller grains, you have to make ethanol from corn and the blueprint to do that in the U.S. and to blend that corn alcohol with gasoline is under attack.

“We need to make sure that people understand this entire standard is under attack. Folks in Congress, some folks in Congress, would like to do away totally with the entire Renewable Fuels Standard and have made proposals to do that,” Vilsack said.

He spoke in answer to a media question about the U.S. Environmental Protection Agency’s proposals for the Renewable Fuels Standard that would reduce the amount of ethanol needed to blend with gasoline.

The EPA’s proposal cut the targeted amount of ethanol to be used in the U.S. fuel supply from 18.15 billion gallons to 15.21 billion gallons. The EPA’s final rule is expected in June.

“They, obviously, have a tough decision to make, and what we have done at USDA is make sure they are fully informed about that decision,” Vilsack said.

He was at DeLong to talk about agricultural exports and the role that exports, including exports of U.S. biofuels and biofuel byproducts like DDGS, play in creating jobs in the U.S. and stabilizing farm and rural incomes.

Vilsack outlined a three-prong strategy to maintain and increase biofuels production in the U.S. and continue to support the export market.

“It’s going to be important for us to defend this standard against it being eliminated. There are job opportunities created, more affordable gas and, obviously, stable incomes and reductions in foreign oil purchases,” he said.

Vilsack relayed some wisdom from his father as he described the second phase of the strategy.

“In the farm bill that passed, that coalition of congressmen that I suggested don’t like the RFS slipped in a provision that basically eliminated our ability to use the REAP program for blender pump funding,” Vilsack said.

The REAP program is the USDA’s Rural Energy for America Program, that provides loans and grants for projects that utilize energy efficiency and the use of renewable energy.

“My father used to say for every ‘don’t’ there’s an ‘anti-’don’t’ and Congress shut one door, but they didn’t shut all the doors. We are going to continue to use our business development programs to help expand access here domestically,” Vilsack said.

He talked about the role that the petroleum industry has played in discouraging the increased use of ethanol.

“We need to make sure that we do a better job of expanding opportunities for higher blends to be available in this country. Unfortunately, the oil industry, Big Oil, has done a very good job of making it much more difficult for the higher blends that are available for vehicles that can use those higher blends to get the fuel. They just simply don’t have the fueling stations and gas stations where E85 and higher blends are available,” he said.

Vilsack also said that American biofuels need to follow their byproducts overseas.

“The third thing is the international opportunity and creating additional markets for this industry,” he said.

“We want to defend the RFS, we want to expand opportunity domestically and we want to make sure we sell this fuel overseas,” he said.