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Biofuel Governors Tout E30

Coalition Sees Opportunity in Higher Fuel Economy Standards

Chris Clayton , DTN Ag Policy Editor
Former Nebraska Gov. Ben Nelson gives an award to Iowa Gov. Terry Branstad during the Governors' Biofuels Coalition breakfast Saturday in Des Moines. Nelson and Branstad also touted higher fuel-economy standards as a way to get 30% ethanol into the marketplace. (DTN photo by Chris Clayton)

DES MOINES (DTN) -- Leaders and founders of the Governors' Biofuels Coalition see a push for higher fuel-economy standards as the next opportunity to spur more biofuels production around the country.

The group met Saturday at the National Governors' Association annual meeting in Des Moines. The governors stressed the opportunities they saw in advancing 30% ethanol blends, or E30, through the push for higher fuel economy and lower emissions. They see this as the way to look beyond mandates set in the Renewable Fuels Standard.

"The nation's biofuels future is a lot more than the RFS," said former Nebraska Gov. and group co-founder Ben Nelson.

The biofuels coalition held a breakfast to honor Iowa Gov. Terry Branstad, the longest-serving governor in U.S. history, described as "a godfather of the biofuels industry," by Nebraska Gov. Pete Ricketts.

Iowa has 43 ethanol plants and produces more ethanol than the state consumes in gasoline. The state continues working on more ways to sell ethanol through E85, blender pumps and E15. Branstad noted biofuels and wind power -- Iowa gets 31% of its energy from wind -- are transforming the state. He stressed the importance of renewable energy to the rural economy, but acknowledged it is a non-stop effort to educate consumers and the public about renewable-energy production.

"We just want to have fair access to the market place so consumers have a choice," Branstad said. "I can't think of a cause that's more important. It is something I truly, truly am committed to."

Branstad called higher octane E30 "as the sweet spot" for both meeting higher octane levels and the higher mileage for the turbo-charged engines that manufacturers will need to meet higher fuel economy standards.

Ben Nelson served as Nebraska governor throughout the 1990s before representing the Cornhusker state in the Senate. He recalled the Governors' Biofuels Coalition began from a meeting between himself and Branstad in the basement of the Nebraska governor's mansion in Lincoln. Nelson noted bipartisanship helped spur the energy bills that created and expanded the RFS. It helped members of Congress from both parties representing states in the coalition to also work together for biofuels, Nelson said.

"The RFS legislation back then would not have been possible without bipartisanship," he said. Nelson added, "We all agreed something needed to be done to weaken the petroleum industry's stranglehold on the nation's transportation-fuel market."

Nelson rhetorically questioned whether such bipartisanship could exist under the current Congress. "Given where we are today, would the RFS had passed today's Congress?" Nelson asked. "That's a question others can answer."

That is why administrative work at EPA remains critical for the future success of the biofuels industry, Nelson said. The RFS remains a foundation for biofuels, but rule changes involving fuel standards may be the next area to help further boost production in biofuels, Nelson said. One rule change could reduce toxic aromatics in gasoline, which could be fixed by shifting fuel blends to higher levels of ethanol.

Nelson pointed to a new initiative, the High Octane-Low Carbon Fuels Alliance, headed by former Senate Majority Leader Tom Daschle. Nelson said the alliance has one objective -- to make sure final rules for a new fuel economy standard includes the use of 30% ethanol blends, E30, to help power more advanced turbo-charged engines and reduce carbon emissions at the same time.

"The transition to a nationwide, high-octane gasoline would fulfill a major RFS goal," Nelson said. "It would require 30 billion gallons by 2022."

Current Nebraska Gov. Pete Ricketts, vice chairman of the coalition, pointed to the group's efforts to lobby EPA to raise the Renewable Fuel Standard blend volumes higher than the rules drafted by the agency in recent years.

"It's certainly puzzling from my standpoint that an administration that talks about protecting the environment doesn't want to continue to make sure that we have as much ethanol in the system as possible," Ricketts said.

EPA has held the RFS volumes below mandates under the law as petroleum refiners have balked at investing in second-generation biofuels needed to meet obligations under the law. EPA just wrapped up the commentary period last week for the proposed 2017 blend levels. EPA's final blend rule for 2017 will come out later this year.

The Nebraska governor tied higher biofuels volumes to one of President Barack Obama's desired goals to leave a legacy of working on climate change by reducing greenhouse-gas emissions. The benefits of biofuels for the environment are a point that needs to be emphasized, Ricketts said. At the very least, EPA should follow the RFS levels established in the 2007 law, he said.

Ricketts called the RFS good policy for the country as a contributor to improving U.S. energy independence. "So that's one of the things we need to continually remind the American public about -- about what an important role we play in making sure our country remains energy secure," Ricketts said.

Other governors attending the breakfast included Gov. John Edwards of Louisiana, Gov. John Hickenlooper of Colorado, Gov. Larry Hogan of Maryland, and Gov. Asa Hutchinson of Arkansas.

Chris Clayton can be reached at Chris.Clayton@dtn.com

Follow him on Twitter @ChrisClaytonDTN

(CZ/BAS)

Chris Clayton

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