The ethanol industry had a big 2011, with growth beating hundreds of other sectors, Renewable Fuels Association President and CEO Bob Dinneen said in his State of the Industry address in Orlando, Fla. He told the crowd at the National Ethanol Conference that the industry added $43 billion to the U.S. gross domestic product.
“Last year, we produced a record 13.9 billion gallons of ethanol, found in more than 95% of all U.S. gasoline and sold coast to coast, border to border — and across the pond — and, on top of that, we produced 39 million metric tons of high-protein feed used by livestock here and abroad,” Dinneen said.
The country produces 14.9 billion gallons of ethanol annually, with 209 plants in operation, he said. That ethanol has lowered gasoline prices for consumers, lessened dependence on oil imports and helped farmers get a better price for corn crops.
“By any reasonable economic metric, the state of the ethanol industry is sound,” Dinneen said. “We are helping to grow the economy, add jobs and stimulate investment in domestic energy supplies.”
Last year also marked the end of the Volumetric Ethanol Excise Tax Credit, which the industry had depended on for decades. The industry allowed the incentive to expire because VEETC’s job of expanding a young sector was complete — proof that ethanol had matured, Dinneen said.
But as strong as the ethanol industry has become, the federal Renewable Fuel Standard remains vital. Dinneen said he supports an all-of-the-above energy strategy, but focusing too much on oil and natural gas, especially drilling in domestic shale formations, and ending the standard would reverse progress that has been made.
The Renewable Fuels Association plans to work with other industry groups and lawmakers to ensure the market for ethanol continues to expand, Dinneen said. Through the approval of E15 — a mixture of 15% ethanol and 85% gasoline — for most vehicles and increased commercialization of E85 for flex-fuel vehicles, the goal can be achieved.
“The RFA has been working with the Open Fuel Standard coalition to promote innovation and consumer choice so that we can grow beyond the 9 million [flex-fuel vehicles] on the road today and develop the infrastructure to support higher blends,” Dinneen said. “To those that see that as a threat to so-called drop-in fuels, I would simply say that a more flexible infrastructure will ultimately benefit all biofuels and create a rising tide for all.”