Ethanol Blog

LINCOLN, Neb. (DTN) -- As the California Air Resources Board is hosting a biofuels and indirect land use change forum on Thursday on the state's low-carbon fuel standard, a new report prepared for the Renewable Fuels Association shows the state's estimate associated with ethanol needs revision.

Penalizing corn ethanol for indirect land use change when calculating its carbon footprint, according to the 73-page report from LifeCycle Associates, has major implications for climate policy effectiveness, market fairness and the economic viability of the U.S. ethanol industry.

The report estimates the indirect land use change values on corn ethanol used in the low-carbon fuel standard are about a decade old and overstate emissions by 300% to 400%.

California last conducted an analysis of the issue in 2014 and 2015, when economic models were less refined for estimating land use change and limited historical data were available for the period when the Renewable Fuel Standard and California's law had been in effect.

"The cumulative effect of methodological improvements has been a steady reduction in estimated GHG emissions from corn ethanol land use change, producing results that are more consistent with observed global market behavior," according to the report from LifeCycle Associates, who examined new models.

"These improvements have allowed for a more nuanced and accurate assessment of how modeled biofuel shocks in response to different policies affect land use and associated GHG emissions. A key outcome of these analysis efforts is a reduction in predicted GHG emissions from LUC associated with corn ethanol."

LifeCycle Associates recommended using the Global Trade Analysis Project, or GTAP, model from 2017.

The Renewable Fuels Association said in a news release the state continues to apply "decade-old" penalties for every gallon of corn- and sorghum-based ethanol sold in California, "with no evidence that such land use changes have actually occurred."

The RFA said U.S. cropland area has declined since the RFS was expanded in 2007, according to both the USDA Census of Agriculture and the U.S. Environmental Protection Agency.

"And, as detailed in RFA comments to CARB earlier this year, the corn area needed to meet California ethanol demand has decreased by more than 700,000 acres -- or 20% -- since the LCFS (low-carbon fuel standard) program began in 2011," the RFA said.

The group said indirect land use scoring "artificially affects" demand and reduces the market value of ethanol, based purely on "flawed, obsolete, and speculative" modeling results.

"RFA calls on the California Air Resources Board to fundamentally rethink its outdated, hypothetical ILUC penalties assigned to ethanol, for the reasons substantiated in this study," RFA President and CEO Geoff Cooper said.

"Real-world experience and empirical data show that the amount of cropland needed to satisfy California ethanol demand continues to trend downward, as crop yields increase and ethanol producers get more renewable fuel from each bushel."

Cooper said the CARB forum should be the "start of a process to comprehensively re-evaluate the agency's flawed approach" to indirect land use change. He said the state "must commit to using the best available science in setting new values."

Todd Neeley can be reached at todd.neeley@dtn.com

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