U. S. ethanol industry wants diversification

Developing non grain sources of ethanol should be a priority for the administration of President Barrack Obama, the U. S. Renewable Fuels Association says.

Chairman Chris Standlee and CEO Bob Dinneen told reporters in a conference call that the Obama administration should provide loan guarantees for next-generation technologies to make the ethanol industry less dependent on corn and grains. “We need credit and capital to build new ethanol plants.”

Current ethanol producers were hit by soaring costs then rapidly falling prices during 2008 and need government support to get closed plants back in production and invest further in the development of cellulosic ethanol, Standlee said. The Environmental Protection Agency should raise the existing ethanol blend limit of 10 per cent up to 15 or 20 per cent and encourage auto-makers to build cars that can run on even higher blends. “Most new cars could easily run on 13 or 14 per cent ethanol.”

The new administration should also call for at least 50 per cent of new cars to be fully fuel flex which means they can operate with 85 per cent ethanol gasoline, he said. “We need a major commitment to renewable fuels to bolster the American economy. It would create a better market for farmers and thousands of green jobs in the ethanol industry.”

Dinneen said that despite a concerted effort by critics of renewable fuels in the meat industry and among some environmental groups, 2008 showed that ethanol production isn’t driving up food prices. “The past year vindicated the position of the biofuel industry that ethanol isn’t causing higher food prices. They were caused by rising fuel costs and speculators. Food prices have remained high while corn and grain prices have fallen sharply. Why haven’t food prices fallen by the same amount? It was a manufactured hysteria driven by one public relations firm.”

What’s more, the ethanol industry only extracts starch from corn and grain leaving the protein, fat and fibre for livestock feed, he said.

The ethanol industry is looking forward to the future and welcomes the opportunity to diversify its sources of supply, he added. “We are committed to the next generation of ethanol technologies that could bring thousands more jobs and lessen our dependence on imported oil.”

He also said “the heat is on the industry to get cellulosic ethanol into commercial production.” The target is to produce 100 million gallons of cellulosic ethanol a year. “It’s an ambitious goal but we are one of the leaders and it is a great opportunity.” With the help of the Obama administration, commercial-size plants could be in regular operation in 2010-11.

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