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Taking Stock of 2016

December 22, 2016


I'm closing out my first year here at the Renewable Fuels Association and couldn't be more proud of the work we have done this year in championing ethanol--the cleanest and lowest-cost high-octane fuel in the marketplace. With the holiday season upon us and New Years' right around the corner, it's a good time to take stock of 2016. So what happened this year in the world of ethanol? Quite a lot, actually. --The RFS. We were pleased not only because EPA issued its annual renewable volume obligation for 2017 on time (before its Nov. 30 deadline), but because the agency got the RFS back on track by raising the conventional biofuels RVO to its statutory requirement of 15 billion gallons. The move will stimulate new interest in cellulosic ethanol and other advanced biofuels, while driving investment in infrastructure to accommodate E15 and higher ethanol blends. With the final rule issued the day before Thanksgiving, EPA gave us lots of reasons to be thankful. --A new U.S. president. After a contentious campaign, Donald Trump won the 2016 presidential election and will become our 45th U.S. president on January 20. Both he and Democratic Presidential Candidate Hillary Clinton were on record in support of ethanol and the renewable fuel standard because they both understood its myriad economic, environmental and energy security benefits. "The RFS... is an important tool in the mission to achieve energy independence to the United States," said Trump on the campaign trail, in January. "I will do all that is in my power as president to achieve that goal ... As President, I will encourage Congress to be cautious in attempting to change any part of the RFS," he said. Since being elected, Trump's spokespeople have reiterated continued support for ethanol and we expect that to continue once he takes office. --Retailer expansion of higher level ethanol blends. Boosted by USDA's Biofuel Infrastructure Partnership funding and the industry-funded Prime the Pump programs, there were numerous retailers this year which expanded their offerings to include higher level ethanol blends, including Kum & Go, Thorntons, Sheetz, RaceTrac, Power Energy Corporation and Indiana-based Family Express. Additionally, Wayne Fueling Systems announced that all of its North American standard retail fuel dispensers were being supplied as compatible and UL-Listed to all blends of ethanol up to 25 percent, becoming the first manufacturer to do so. HWRT Oil Company became the first company in the U.S. to offer pre-blended E15 at the terminal. Meantime,, a website maintained by RFA that helps consumers track down nearby E85 stations, also began tracking E15 locations. --DDG Exports This fall, RFA and the U.S. Grains Council hosted the Export Exchange, which offered attendees a unique opportunity to meet and build relationships with domestic suppliers of corn, DDGS, sorghum, barley and other commodities. More than 200 international buyers and end-users of coarse grains and co-products from more than 35 countries attended the event. The conference resulted in reported sales of approximately 2.6 million metric tons of grains and co-products worth $460 million. The top grain traded during the two-day conference was corn, with 924,500 metric tons collectively exchanged, followed by DDGS, with 875,000 metric tons exchanged. --Ethanol exports. An important and growing market for the U.S. ethanol industry continued to be exports. Some of the largest markets in 2016 were Brazil, Canada, Mexico and India. With more countries around the world recognizing the numerous benefits of ethanol, we expect U.S. ethanol exports to expand further next year. Meantime, in June the EU General Court annulled the European Union's countrywide 9.5% antidumping duty on all ethanol imported from the U.S. The duty had been in place since February 2013. The European Commission has since filed an appeal to the ruling, but we are hopeful to see that market open again soon. --What Blendwall? RFA analyzed recent data from DOE that showed the fuel supply consumed in 25 states and the District of Columbia contained more than 10% ethanol on average in 2015, demonstrating that the so-called E10 blendwall continues to crumble. The 2015 data was the latest available and published by DOE's Energy Information Administration in December. The data completely undermines legislation proposed by Reps. Bill Flores (R-Texas) and Peter Welch (D-Vt.) that would limit blends to no more than 9.7% ethanol content. --All Smoke, No Fire There were repeated efforts by our opponents this year to repeal or reform the RFS, but we fought back at each and every attempt. In June, RFA President and CEO Bob Dinneen testified at a House Energy and Commerce Subcommittee hearing on the RFS, telling the panel the program is helping to drive investment in renewables and encourage competition at the pump—exactly what was intended when Congress passed the program. All the congressional bloviating by RFS critics just amounted to a bunch of hot air. Facts beat rhetoric every time. --All Aboard! In an effort to educate boaters, conservation enthusiasts and consumers about ethanol's benefits and its use in marine applications, RFA announced in October it would be a co-title sponsor of the Crappie Masters Tournament Trail this year with Bass Pro Shops. The sponsorship includes print and TV advertising, as well as a presentation on an episode of Crappie Masters TV. There's a lot of misinformation perpetuated by biofuel opponents surrounding boating and ethanol, but for nearly 30 years, 10% ethanol has been used in all types of marine engines. --Education. RFA held four, 20-hour courses conducted across the Corn Belt to help facilities meet the requirements of the Food Safety Modernization Act. Meantime, the Renewable Fuels Foundation, the education and research arm of RFA, hosted five webinars focused on ethanol's unique octane properties, and RFA also hosted a slew of ethanol safety seminars on proper training techniques that emergency responders and hazmat personnel needed to respond to an ethanol-related emergency. --New Members. Perhaps not surprisingly because of all we did this year, RFA continued to grow its outreach, adding several new members, including Western Plains Energy, KAAPA Ethanol Ravenna, Fox River Valley Ethanol Co., Siouxland Ethanol and Valero Renewable Fuels Co., the third-largest U.S. ethanol producer. Meantime, in October, we elected Mick Henderson, general manager at Commonwealth Agri-Energy as our chairman of the board, with Vice Chairman Neil Koehler of Pacific Ethanol and Treasurer Jim Seurer of Glacial Lakes Energy. We are proud to represent our diverse members and look forward to more membership growth next year. So what's in store for 2017? If this year was any indication, 2017 will be another busy year for the ethanol industry, and we at RFA look forward to continuing to offer consumers with the cleanest and lowest-cost, high-octane fuel in the world.