Doug Durante is Executive Director of the Clean Fuels Development Coalition, a non-profit organisation promoting pro-biofuels programs and policy in the US. We caught up with him at the World Ethanol & Biofuels conference in Brussels to discuss recent regulatory changes, the advantages of ethanol as an octane enhancer and the environmental footprint of corn.
“We think we’re on the verge of getting a whole new report card on the carbon footprint of corn that’s going to be appreciably better than what we’ve had in the past.”
In your presentation, you talked a lot about the recent approval of year round E15 in the US. But I got the sense that you’re not entirely satisfied with that. Where should we go next with ethanol in the USA?
Well what we had was an announcement by the president that he would direct our Environmental Protection Agency to develop a rule that would allow E15. So it wasn’t an instantaneous granting of E15. Those rules take time, they’re somewhat controversial, they’re open to comments, and there’s a number of procedures they have to go through. So it’s not an automatic measure, and the key to that is to hope that it’s ready in time for next year when the restriction would have taken place. And so that’s why we’re less than jumping up and down at this point.
And another change that’s happened in the US is the EPA’s new fuel economy standard. Does that create an opportunity for biofuels in your opinion?
Absolutely. I’m very excited about that and I’ll tell you why. The Fuel Economy Standard is not just getting more mileage per gallon, but you have to do it while emitting less carbon. So one of the ways you do that is to increase the compression in automobiles, which requires higher octane. And one of the things that ethanol has that not a lot of people focus on is that it’s the highest octane additive that you can put into gasoline. So it’s very valuable for octane, plus it’s low carbon. Because this new EPA regulation coming out is going to be a combination of efficiency and greenhouse gas reductions, we think ethanol is going to be a great fit. So yeah, we’re very excited that it’s going to be a new opportunity.
Something else you touched upon in your presentation was the keyword “security”. I was wondering – at this juncture in particular, with increasing tensions with Iran, Saudi Arabia and Russia – where does ethanol fit in in securing America’s energy independence?
I see it as a very valuable component. I have to be very honest with you: I’m not sure it’s appreciated enough. You know one of the things that’s interesting about ethanol is that at any given time it has different value propositions. When oil is very expensive and we’re unable to get it then energy security is a big thing; when it’s cheap you don’t think about it. We’ve lost a little bit of that momentum because we’re drilling so much oil ourselves in the United States. So I think it is very important. 10% of our fuel is ethanol, so if you were to take that away, you’d have to make it up somewhere. So I think it is very important, and it’s an important factor I hope we don’t lose sight of, but that’s up to us in the industry to keep reminding people that that’s not to be forgotten.
And while we’re on the subject of politics, I think something that’s come up a lot in this year’s conference is the China tariffs. I wonder what you think US ethanol producers can do if they want to survive the period of the tariffs and come out well on the other end?
A lot of our producers are working very hard with the Department of Agriculture and the US Grains Council – I know we’re going to have a US Grains person here tomorrow – and then there’s a follow up meeting the day after. We’re working pretty hard to develop some of these markets, so we’re going to have to make that up somewhere. We talked about that in our panel today. And, okay, one way is to find new markets, the other way is to use more at home. So that’s more what I’m familiar with, and so that was the focus of my presentation – to get blends up to 20, 25, 30 percent, and that way it would offset any pain that might be caused by this Chinese situation. But there’s no doubt that these tariffs are creating quite a bit of turmoil for everybody involved. And one of the things I don’t like about relying too much on exports is they can be gone in an instant – any executive decision on either end can turn that around. So we’re going to have to find new markets
And if we look at decarbonisation, it isn’t all about the blend rate – it’s also about how much of a GHG saving you can get from the specific feedstock you’re using. So if you look at corn in the US at the moment, how high are the GHG savings, and what progress is being made in pushing those up?
Great question, and we have great answers to that. Last year when I was here in my presentation I was asked to talk specifically about the low carbon fuel standard, how we might fit into that – and we’re getting a lot of new data on the value of corn. One of the things that we don’t get enough value for is that as this industry has grown it has caused corn farmers in the US to be more efficient. So we’re growing more corn on less land with less fertiliser input, which improves your carbon footprint. But in fact it’s much greater than we even thought. So we’ve got some new data that suggests that the root of a corn stalk is several feet longer than we’d previously thought. Well now the sequestration, and its ability to pull carbon out of the air is much greater, and retain it in the soil. So we think we’re on the verge of getting a whole new report card on the carbon footprint of corn that’s going to be appreciably better than what we’ve had in the past. And if that happens then we’re going to be able to participate in some of these low carbon fuel programs, and I think when all things are considered we’re going to really be able to rival some of these other technologies, so we’re excited about that. But it’s just a question about modelling, and what the assumptions are, and what the inputs are, and a lot of these are based on old data that needs to be refreshed.