ACE urges USDA to reward biofuel producers for carbon reductions

The American Coalition for Ethanol encouraged the USDA to help establish a protocol for biofuel producers and farmers to easily document the carbon intensity benefits of changes in agricultural practices in comments submitted today regarding USDA’s climate strategy for President Biden’s Executive Order on Tackling the Climate Crisis at Home and Abroad. As USDA contemplates the role it will play to advance climate-smart agriculture, ACE CEO Brian Jennings’ comments urge USDA develop a commonsense framework to verify practices that sequester carbon in the soil so farmers and ethanol producers can reap the rewards in future low carbon fuel standard markets.

ACE’s comments detail the opportunity farmers and biofuel producers hold today to help meet the ambitious climate goals set forth by the Biden administration and the critical role USDA could play to help validate farm-level carbon credits for biofuels. “The U.S. will not achieve the ambitious climate goals unless steps are taken to reward farmers and biofuel producers for their ability to be part of the climate solution,” the comments stated.

The written comments highlight that today’s corn ethanol meets the definition of an advanced biofuel with its ability to reduce greenhouse gas (GHG) emissions by 50 percent compared to gasoline. “In other words, we do not need to wait for so-called next generation crops or biofuels, or electric vehicles (EVs) and an entirely new supply chain to support them, to immediately begin tackling climate change.”

Further, the gold standard tool for determining lifecycle GHG emissions of transportation fuels, the GREET model, will be updated soon to account for further adoption of climate-smart farming practices, which would credit corn ethanol for GHG emissions reductions between 60 and 70 percent compared to gasoline. In fact, ACE commented, ethanol is the only transportation fuel that can reach net-negative carbon intensity through carbon capture and sequestration and continued advancements within ethanol facilities and on-farm practices in how biofuel crops are grown.

“The sooner USDA helps validate the role farm-level practices can have in further reducing corn ethanol’s carbon footprint, the sooner the U.S. can begin making good on ambitions to reduce GHG emissions by 50 percent by 2030 and reaching net-zero emissions by 2050.”

Soil carbon models and the GREET model could be used by regulators such as the California Air Resources Board (CARB) today to assign credits for climate-smart farming practices that help reduce the overall carbon intensity of corn ethanol. However, there is a double-standard because CARB chooses not to rely on trusted models to provide farm-level carbon credits for biofuels, but willingly uses models to assign carbon penalties, such as land use change, to biofuels. ACE’s comments offer recommendations for USDA to ensure farmer access to low carbon fuel markets.

For access to ACE’s full written comments to USDA, click here.


Summit Carbon Solutions expands into Nebraska

ummit Carbon Solutions is pleased to announce the growth and further development of the world’s largest carbon capture and storage project, which will link dozens of carbon dioxide emission sources, primarily biorefineries, from across the Midwestern United States to permanent geologic storage sites in North Dakota.  In two months since the formal launch announcement in February 2021, Summit Carbon Solutions has expanded relationships across the biorefining industry, resulting in the addition of 12 biorefineries to its network, bringing the current total to 30. Through this expansion, Summit Carbon Solutions’ committed CO2 volume will likely result in commitments exceeding the company’s original target of 10 million metric tons per year.

The new biorefinery additions will extend Summit Carbon Solutions’ network of CO2 sources deeper into Iowa and Minnesota and will broaden its reach with its first

commitments from CO2 sources in Nebraska.  The expansion into Nebraska will be supported by Green Plains, Husker Ag, and Louis Dreyfus Company, which will supply CO2 from their facilities, dramatically reducing the carbon footprint of their respective operations.

“We are pleased to welcome more forward-thinking biorefiners into the project,” said Bruce Rastetter, CEO of Summit Agricultural Group, the project developer.  “Carbon capture and storage will be transformative for the industry and we could not be more excited to play a role in the development.  While our current partners are all biorefiners, we are in active discussions with other industrial emitters in the Midwest,” Rastetter added.  “This will be an inclusive project with a variety of stakeholders that will allow other emitters to achieve carbon reduction goals.”

“Biorefining and agriculture are vital to Nebraska’s economy,” said Pete Ricketts, Governor of Nebraska.  “By partnering with Summit Carbon Solutions, Nebraska biorefiners will greatly accelerate their efforts to produce a net zero carbon fuel, while at the same time bolstering the agricultural producers they serve and the local economies they support.  I look forward to seeing this project take shape and seeing the impact it will have on Nebraska.”

In addition, Summit Carbon Solutions is making progress toward its operational date in 2024 with the engagement of best-in-class consultants and engineers to design and optimize the project:

  • Trimeric Corporation, an engineering firm with extensive experience in carbon capture system design, is conducting preliminary engineering on carbon capture systems that will be located at each partner plant.  Trimeric is an industry leader in the design of carbon capture systems and has led similar biorefinery carbon capture projects in Illinois, North Dakota, and Kansas.
  • Wood, a global leader in consulting and engineering, with considerable expertise in midstream infrastructure, is performing pre-FEED (Front End Engineering and Design) analysis on the carbon dioxide pipeline network to determine optimal size, routing, and design.  Wood is one of the world’s most reputable pipeline engineering firms and has vast experience in CO2 pipeline design.
  • The Energy and Environmental Research Center (EERC), a research and development arm of the University of North Dakota, is assisting Summit Carbon Solutions in selecting, analyzing, and developing CO2 storage sites in North Dakota.  The EERC is a global leader in geotechnical analysis related to carbon management and has unmatched knowledge of geology in North Dakota.

“We are thrilled to add these world-class consultants to our efforts,” said Justin Kirchhoff, President of Summit Ag Investors. “Capturing, transporting and storing more than 10 million tons of CO2 per year is an ambitious goal, but it’s necessary to meet urgent decarbonization needs, and we have the right group of partners, consultants, and technical experts to bring the business plan to fruition.”


USDA: Corn use for ethanol down in February

The USDA recently released its Grain Crushings and Co-Products production report for April, reporting that corn use for fuel ethanol production in February 2021 was down when compared to both the previous month and February 2020.

Total corn consumed for alcohol and other uses was 376 million bushels in February 2021, down 19 percent from January 2021 and down 22 percent from February 2020. Usage included 91 percent for alcohol and 9 percent for other purposes.

Corn use for fuel alcohol was at 333 million bushels in February, down 20 percent when compared to January 2021 and down 23 percent from February 2020. Corn consumed in for dry milling fuel production and wet milling fuel production was at 90.9 percent and 9.1 percent, respectively.

The USDA withheld the volume of sorghum used for fuel ethanol production in February

in order to avoid disclosing data for individual operations. Sorghum data was also withheld for January 2021. Approximately 5.857 million hundredweight (cwt) (327,992 tons) of sorghum went to fuel ethanol production in February 2020.

At dry mills, condensed distillers with solubles production was at 92,525 tons, up from 79,610 tons the previous month, but down from 102,244 tons in February 2020. Corn oil production fell to 117,903 tons, down from both 148,527 tons in January and 149,000 tons in February of the previous year. Distillers dried grains production fell to 262,261 tons, down from 342,557 tons in January and 328,113 tons in February 2020. Distillers dried grains with solubles production fell to 1.41 million tons, down from both 1.75 million tons the previous month and 1.82 million tons in February 2020. Distillers wet grains production fell to 885,932 tons, down from 1.04 million tons in January and 1.28 million tons in February of last year. Modified distillers wet grains production fell to 377,688 tons, down from 415,857 tons in January 2021 and 469,444 tons in February 2020.

At wet mills, corn germ meal production fell to 44,416 tons, down from 53,242 tons in January 2021 and 63,305 tons in February 2020. Corn gluten feed production fell to 217,605 tons, down from 282,163 tons the previous month and 281,160 tons in February of last year. Corn gluten meal production was at 97,680 tons, down from 116,178 tons in January, but up from 88,021 tons in February 2020. Wet corn gluten feed production fell to 169,005 tons, down from both 214,623 tons in January and 217,691 tons in February 2020.

At wet and dry mills, carbon dioxide captured fell to 182,552 tons, down from 193,297 tons the previous month and down from 211,775 tons in February 2020.


Growth Energy touts biofuels’ role in meeting climate goals

Today, Growth Energy CEO Emily Skor submitted comments to the U.S. Department of Agriculture regarding agriculture’s role in addressing the climate crisis both at home and abroad. In her comments, Skor argues that plant-based biofuels like ethanol are a readily available, renewable energy solution that reduces carbon emissions today.

“Incorporating biofuels into our nation’s fuel supply has been one of our most successful energy policies to date, benefitting both the environment and consumer,” wrote Skor. “With many states and localities increasingly exploring public policy options to lower carbon emissions, biofuels have become an affordable and accessible solution for many. Recent studies clearly demonstrate that biofuels can immediately contribute to lowering greenhouse gas (GHG) emissions and decarbonizing our transportation sector.”

“In fact, a recent January 2021 study by Environmental Health and Engineering, Inc. found that ethanol reduces GHGs by 46 percent compared to traditional gasoline. USDA also supported a study which found corn ethanol’s relative carbon benefits could reach up to 70 percent by 2022. Additionally, biofuels are responsible for nearly 80 percent of all carbon reductions credited under California’s Low Carbon Fuel Standard, with the recorded carbon intensity of ethanol declining 33 percent since 2011.”

As the administration and Congress continue to discuss carbon capture as a means to reduce emissions, Skor highlighted the ethanol industry’s already strong role in this space.

“Approximately 50 U.S. ethanol plants already capture, clean, and condense 99 percent-pure carbon dioxide… Our facilities capture and transport carbon dioxide directly to customers, significantly dropping the net amount of carbon dioxide that would be emitted into the air or drilled out of the ground.”

Read Skor’s full comments to USDA here.


USDA publishes REAP rule, solicits public comments

The USDA Rural Business-Cooperative Service on April 27 published a final rule for the Rural Energy for America Program that makes changes related to the OneRD guaranteed loan regulation and 2018 Farm Bill. A public comment period is open through June 28. The rule is scheduled to take effect on July 26.

In July 2020, the USDA promulgated regulations enacting the OneRD guaranteed loan regulation, which contained four USDA loan programs, including REAP, into one comprehensive and guaranteed loan processing and servicing regulation. The final rule released on April 27, in part, removes references that have become superfluous in light of the OneRD regulation, according to USDA. Program modifications required by the 2018 Farm Bill, as well as provisions that have been previously published via funding opportunities in Federal Register publications, have also been incorporated

into the rule to eliminate the need for annual notification and to enhance program delivery.

Additional information is available on the Federal Register website.


Clariant, Pertamina collaborate on advanced biofuels assessment

Clariant, a focused, sustainable, and innovative specialty chemical company, is working with Indonesia’s state-owned oil and gas corporation, Pertamina, since 2018 to evaluate and test the feasibility of Clariant’s sunliquid technology to process available regional feedstocks in Indonesia into the advanced biofuel, cellulosic ethanol.

Indonesia has a vast potential of untapped biomass, from empty fruit bunches to palm leaves, that could be converted into cellulosic ethanol. Their present-day utilization is negligible and, until now, both feedstocks are frequently burnt, causing air


In Indonesia, ethanol demand is expected to increase dramatically, spurred primarily by a nationwide E10 ethanol blending mandate. Advanced fuel technology solutions, such as Clariant’s sunliquid process, are vital to match the feedstock potential with the increasing ethanol demand in the country.

Since 2018, Pertamina and Clariant have been assessing how to bridge this gap. The collaboration first focused on techno-economic performance analysis, and the testing of empty fruit bunches and palm leaves. The final results of the assessments proved that the sunliquid technology can successfully convert both feedstocks into cellulosic ethanol while achieving a good conversion yield.

Further, a recently conducted conceptual engineering study quantified process balance, facility specification, and process economics in detail. This lays the groundwork for Pertamina’s continued consideration of investing in commercial-scale advanced biofuel production plants.

“We are delighted that Pertamina, a renowned energy player in Indonesia, has chosen our sunliquid process for this technology and feedstock assessment, as well as for a process design study for a commercial-scale plant based on regional feedstocks,” said Christian Librera, Clariant’s vice president and head of business line biofuels and derivatives. “The excellent results demonstrate once again the flexibility and efficiency of our sunliquidtechnology platform for different lignocellulosic feedstocks,” he added.

“As other international oil companies start to navigate energy transition, Pertamina has committed to play its part by fostering clean energy development to reduce global carbon emissions. Our new and strong aspiration is underpinned by essential judgment about the forthcoming future, that clean energy is the key to energy sustainability,” said Andianto Hidayat, Pertamina’s vice president of downstream research and technology innovation.

“As a result, we are strengthening our business portfolio by producing green fuel, such as biodiesel, green aviation fuel, and bioethanol using palm residues that are abundant in Indonesia. We are embracing a robust growth in clean energy by building two green refineries and optimizing domestic resources to ensure Indonesia’s energy independence,” he added.

The realization of commercial-scale, advanced biofuels projects based on regionally available feedstocks, could help Indonesia become more independent from foreign fossil fuel imports and secure its national energy supply. In 2015, the Indonesian government introduced national biofuels targets. The bioethanol mandate in transport for the non-Public Sector Service Obligation (PSO) aims for a 10 percent bioethanol content as a gasoline additive and will be realized in the next few years.

Pertamina presented the project results at the Hannover Messe held virtually from 12th – 16th April. Indonesia was this year’s event partner country.


Bill will help farmers, foresters participate in carbon markets

Sens. Mike Braun, R-Ind.; Debbie Stabenow, D-Mich.; Lindsey Graham, R-S.C.; and Sheldon Whitehouse, D-R.I., on April 20 re-introduced the Growing Climate Solutions Act, which will break down barriers for farmers and foresters interested in participating in carbon markets so they can be rewarded for climate-smart practices. The bill passed out of the Senate Committee on Agriculture, Nutrition and Forestry on April 22. The legislation was previously introduced in June 2020 and addressed during a senate hearing later that month.

 The bill would create a certification program at USDA to help solve technical entry barriers that prevent farmer and forest landowner participation in carbon credit markets. According to the senators, these issues—including access to reliable information about markets and access to qualified technical assistance providers and credit protocol verifiers—have limited both

landowner participation and the adoption of practices that help reduce the cost of developing carbon credits.

To address this, bill establishes a Greenhouse Gas Technical Assistance Provider and Third-Party Verifier Certification Program through which USDA will be able to provide transparency, legitimacy, and informal endorsement of third-party verifiers and technical service providers that help private landowners generate carbon credits through a variety of agriculture and forestry related practices. The USDA certification program will ensure that these assistance providers have agriculture and forestry expertise, which is lacking in the current marketplace. As part of the program, USDA will administer a new website, which will serve as a “one stop shop” of information and resources for producers and foresters who are interested in participating in carbon markets.

Through the program, USDA will help connect landowners to private sector actors who can assist the landowners in implementing the protocols and monetizing the climate value of their sustainable practices. Third party entities, certified under the program, will be able to claim the status of a “USDA Certified” technical assistance provider or verifier. The USDA certification lowers barriers to entry in the credit markets by reducing confusion and improving information for farmers looking to implement practices that capture carbon, reduce emissions, improve soil health, and make operations more sustainable.

The bill would also create an advisory council composed of agricultural exports, scientists, producers and others that advise the secretary of agriculture and ensure that the certification program remains relevant, credible, and responsive the needs of farmers, forest landowners, and carbon market participants. Finally, the bill would also instruct the USDA to produce a report to Congress to advise about further development of this policy area, including barriers to market entry, challenges raised by farmers and forest landowners, market performance, and suggestions on where the agency can make a positive contribution to the further adoption of voluntary carbon sequestration practices in agriculture and forestry.

Supporters of the Growing Climate Solutions Act include American Farm Bureau Federation, American Soybean Association, Archer Daniels Midland Co., Biotechnology Innovation Organization; Corn Refiners Association, Green Plains, National Alliance of Forest Owners, National Woodland Owners Association, National Corn Growers Association, National Farmers Union, Novozymes, Syngenta, Growth Energy, and National Biodiesel Board.

Growth Energy has spoken out in support of the bill. “Today, on Earth Day, we applaud Senators Stabenow, Braun, Graham, and Whitehouse and the broad and bipartisan list of co-sponsors for their leadership on the Growing Climate Solutions Act,” said Emily Skor, CEO of Growth Energy. “Our ag communities are already eager to play a large role in reducing emissions nationwide and soil carbon sequestration expands this participation in our nation’s climate change strategy. The Growing Climate Solutions Act rightly rewards farmers for climate-smart practices and provides important guidelines for success.” 

Additional information is available on the Senate Committee on Agriculture, Nutrition and Forestry website.


Royal Farms opens 21st ethanol refueling station

This Earth Day Royal Farms and Protec Fuel Management LLC celebrate their past year’s achievement of displacing petroleum fuel with enough low carbon biofuels to account for a pollution reduction equivalent to planting more than 102,353 trees. This May, Royal Farms will also mark the opening of their 21st advanced biofuel station in the region. About 95 percent of the vehicles on the road today can use Regular 88. In addition, just under 10 percent of vehicles are flexible fuel and equipped to use E85.

For more than a decade Royal Farms has made sustainability a priority. Efforts include building all new stores to meet LEED certification requirements, sustainability education for staff, and recycling waste cooking oil into biodiesel. While the programs have at times added cost and complexity to projects, the company’s unwavering commitment is making an impact. With the addition of these new locations in 2021, cleaner

ethanol fuels at Royal Farm locations are projected to cut greenhouse gas emissions by the equivalent of planting 146,984 trees and letting them grow for ten years, or 60.8 acres of forests preserved from conversion to cropland in one year.

“We are proud to be a leader in carbon reductions by selling renewable fuels. Offering higher quality products at a better value is the cornerstone upon which Royal Farms was built,” said Fuel and Environmental Compliance Leader Tom Ruszin. “We want our customers to know they can affordably switch now to low carbon fuels that help improve air quality,” he added.

Protec Fuel’s business has been to assist retail stations to be more successful, lowering fuel costs as well as enhancing respective station’s digital footprint and technology for enhanced marketing. Protec has been a national leader in variety of ethanol fuels since designing, installing, and supplying the very first E85 station in several states.

Royal Farms would like to thank US Department of Agriculture and Maryland Energy Administration in providing grant assistance for some of its biofuel stations. “Royal Farms is committed to making investments in low-carbon, clean-burning fuels for our customers, but these government grants helped us expand the footprint of these offerings as a faster pace. With continued support, we will accelerate the integration of these technologies to help improve our communities,” explained Ruszin.

Royal Farms is also celebrating Earth Day (April 22nd, 2021) by giving away a free reusable Royal Farms tote bag with the purchase of any Royal Farms family meal. The goal of the bag giveaway is to promote reusable bags as an alternative to paper or plastic.


Bill aims to revamp REAP, move AgSTAR from EPA to USDA

Reps. Chellie Pingree, D-Maine, and Martin Heinrich, D-N.M, on April 22 introduced the Agricultural Resilience Act, which outlines a farmer-focused, research driven path to net-zero agriculture. The bill would, in part, make changes to the Rural Energy for America Program and moves the federal AgSTAR program.

REAP, a program created in the 2008 Farm bill and reauthorized by both the 2014 Farm Bill and the 2018 Farm Bill, provides guaranteed loan financing and grant funding to agricultural producers and rural small businesses for renewable energy systems or to make energy efficiency improvements.

Section 601 of the legislation would make the reduction of greenhouse gas (GHG) emissions a primary purpose of the REAP program and add those goals to its selection criteria. The bill would also make agricultural processors eligible for energy efficiency grants and allow NGOs and

producer co-ops to be eligible for grants to do energy audits in addition to agencies, rural utilities and colleges and universities. In addition, it aims to increase the maximum REAP award from 25 percent to 50 percent of project costs, and to 75 percent of project costs for producers who are beginning, socially disadvantaged, or veteran farmers or ranchers. The updated REAP program would prioritize projects that would result in the largest net decreases in GHG emissions and set aside 5 percent of funds for on-farm demonstration projects. Regarding funds, the bill would increase mandatory funding for the program in stair steps from $50 million in fiscal year 2021 to $400 million in fiscal year 2024 and thereafter.

Section 602 of the bill directs USDA to do a detailed study of dual-use renewable energy and cropping or livestock systems, plus a risk benefits analysis and a five-year research and extension plan.

Section 603 would transfer the U.S. EPA’s AgSTAR (anaerobic digestion to reduce methane emissions) program to the USDA and include a $5 million authorization for appropriations.

Additional information is available on Pingree’s website


Valero provides update of renewable fuel projects

Valero Energy Corp. released first quarter financial results on April 22, reporting improved results for its ethanol operations and record operating income for its renewable diesel segment. The company also discussed plans for a carbon capture and storage (CCS) project linked to eight of its ethanol plants.

Valero’s ethanol segment reported a $56 million operating loss for the first quarter, compared to a $197 million operating loss reported for the same period of 2020. The operating loss for the first quarter of 2021 includes estimated excess energy costs of $54 million related to the impacts from Winter Storm Uri.

Ethanol production volumes averaged 3.6 million gallons per day for the first quarter of 2021. Down 541,000 gallons per day when compared to the first quarter of 2021. Moving into the second quarter, Valero Vice President of Investor Relations Homer

Bhullar said Valero’s ethanol segment is expected to produce 4.2 million gallons per day with operating expenses expected to average 38 cents per gallon.

Joe Gorder, chairman and CEO of Valero, discussed the company’s March 2021 announcement that it is partnering with BlackRock and Navigator to develop a carbon CCS system in the Midwest that would allow carbon dioxide captured at eight Valero ethanol plants to be sequestered underground. In addition to creating benefits through the 45Q tax credit, Gorder said the project will allow Valero to capture higher value for the resulting lower-carbon ethanol in certain markets, such as California’s Low Carbon Fuel Standard market. He said the CCS system is expected to be capable of storing 5 million metric tons of carbon dioxide per year.

Valero’s renewable diesel segment, which consists of the Diamond Green Diesel joint venture, reported $203 million in operating income for the first quarter, up from $198 million during the same period of last year. Renewable diesel sales volumes averaged 867,000 gallons per day during the three-month period. Gorder said the segment continues to provide solid earnings and set records for operating income and renewable diesel product margin during the first quarter.

According to Gorder, the expansion project at the existing DGD plant in Louisiana remains on budget and is expected to be operational by the fourth quarter of this year. The project is expected to increase renewable diesel production capacity at the site by 400 million gallons per year, bringing the total capacity of the plant to 690 million gallons per year.

Development of the DGD plant under development in Port Arthur, Texas, is also continuing to move forward, Gorder said. That 470 MMgy facility is expected to be operational during the second half of 2023. The project will boost DGD’s annual capacity to 1.2 billion gallons of renewable diesel and 50 million gallons of renewable naphtha.

Overall, Valero reported a net loss attributable to Valero stockholders of $704 million, or $1.73 per share, for the first quarter, compared to a net loss of $1.9 billion, or $4.54 per share, for the same period of 2020.