By Geoff Cooper, RFA President and CEO
On May 20, the Washington Times published a guest column by Jerry Jung, founder of the group “ReThink Ethanol,” in which he demonstrates a complete misunderstanding of the very federal policy he seeks to “rethink.” We responded with the following letter, which the newspaper has not chosen to publish.
To the Editor:
Jerry Jung runs a shadowy coalition of clean-energy opponents called “Rethink Ethanol.” Based on his obvious misunderstanding and confusion about today’s ethanol industry, Jung should take his own advice: He should rethink everything he claims to know about America’s top renewable fuel.
How are we to trust Jung when he can’t even get basic facts about the Renewable Fuel Standard (RFS) and ethanol correct? He claims the EPA “mandated” the production of 20.77 billion gallons of corn ethanol this year. No such mandate exists, nor has there ever been a requirement to use corn ethanol. Rather, EPA has proposed to require the use of 20.77 billion gallons of all renewable fuels under the RFS in 2022. Oil companies are free to choose the renewable fuel that makes the most sense for them to blend, be that biodiesel, biogas, renewable diesel, sustainable aviation fuel, cellulosic ethanol, or any number of other renewable fuels. Far from “mandating” corn ethanol, EPA in fact places a limit (of 15 billion gallons) on the amount of corn ethanol that can be used to fulfill the RFS requirements.
Jung goes on to suggest that 41.9 trillion (yes, ‘trillion’ with a ‘t’) acres will be used to support ethanol production this year. Notwithstanding that such an area would be 330 times more land than exists on planet Earth, Jung neglects to mention that every acre of corn used for ethanol also results in the production of 1.5 tons of high-protein feed for beef and dairy cows, swine, poultry, and fish. The truth is, more corn is available globally today for animal feed and other non-ethanol uses than at any time in history. According to USDA, only 16 cents of every consumer dollar spent on groceries pays for the raw farm commodities and ingredients in those grocery products. And less than 3 cents of every consumer dollar spent on food can be tied to corn. So even if ethanol demand caused corn prices to jump by 50% (which has not happened), the impact on consumer food prices would be no more than 1.5%. Simply put, eliminating the RFS, as Jung advocates, would have no detectable impact on food prices.
Jung is correct that ethanol has a “dramatic” impact on consumer gasoline prices—but that impact is the exact opposite of what he suggests. Today, ethanol is selling for $1 per gallon less than gasoline at wholesale fuel blending terminals. Thus, adding ethanol to gasoline reduces prices at the pump—just go to any retail station selling both gasoline with 10% ethanol (E10) and “ethanol-free” gasoline (E0) for evidence of this. Blends containing more ethanol, like E15, are selling for as much as 60-80 cents per gallon below E0.
Let’s be honest. Jung’s beef with ethanol has nothing to do with the environment or fuel prices. This is about protecting his pals in the oil industry, whose talking points against ethanol are prominently featured all over Jung’s website (lest we forget, Jung made his fortune selling Caterpillar equipment that consumed millions of gallons of dirty petroleum fuels). At a time when oil refiners are rolling in record profits, they want to eliminate a renewable fuel that lowers both pump prices and emissions of greenhouse gases and harmful air pollutants. And Jung is all too eager to help. Before “rethinking ethanol,” Jerry Jung should actually take the time to learn about it first.
President and CEO
Renewable Fuels Association