Ethanol in the Future of Middle-America
By Adrian Dingle
Ethanol in the Heartland
If you live in the Midwest of the United States as I do, then you understand biofuels, and Ethanol’s role in their production, more than most. Any routine car journey across a rural or semi-rural part of several states in the region will mean passing vast swathes of agricultural land used to plant corn and soyabeans that are used for such purposes. The same is true across the states that make up the Great Plains. Colossal areas of the US are devoted to growing the crops that are used in the production of ethanol used in biofuels.
Because of this, adjacent to those fields of tall corn that are such a feature of the landscape in the fall in middle-America, one will find small ethanol plants. In Indiana alone there are fourteen of varying sizes currently turning corn into ethanol across the state. In short, with an educated eye, ethanol can be ‘seen’ everywhere across the center of the country.
At the beginning of 2022 the outlook for ethanol production in the US looked largely predictable. According to the Renewable Fuels Association, output in America had held steady between 2012 and 2021 at around 15 billion gallons per year. The same source reported that the US produces around 55% of the world’s fuel-based ethanol, and unlike many other industries, those numbers underwent only very small changes during COVID. So far so good for ethanol, but what of the future? Is there any reason to suspect that things might change? Well perhaps, and here’s why.
War in Ukraine
Global politics is destined to have ripple effects across the whole planet. Recent events in Ukraine have brought many crops into the spotlight for more than one reason. In 2019 around 18% of the world’s corn (maize) was produced by Ukraine and Russia combined. 64% of sunflower oil, and 23% of wheat also came from those two countries, and around 40% of the World Food Program’s wheat supplies come from Ukraine. All of that is a quick way of saying that the world’s supply of many crops has been severely interrupted by the conflict in Europe, and that there are inevitable downstream effects regarding availability and cost that many people are now experiencing. How does all of this fit into the production of ethanol around the globe?
One element of the debate now surrounds what agricultural land should be used for. Do we have an obligation to turn more land into that which produces food, at the expense of the land which is currently being used to grow the crops that are converted to biofuels? Even when putting the war in Ukraine to one side, with a still increasing world population (the absolute number of people living on the planet is predicted to keep growing before a decline in about 70 years’ time), and considering the increasing threat of climate change to agriculture in general, it’s hard to see how food production is not going to be put under increasing pressure in the short, medium, and long term. That’s likely to further exacerbate the “food or ethanol production” discussion surrounding corn.
Blended Fuels
On a more positive note, ethanol blended fuel has been a permanent part of the regular gasoline market in the US since the early part of the 21st century. Both the use of, and the percentage of ethanol within ethanol-blended fuels, are on the rise. Government incentives have continued to further encourage both, and the environmental benefits are constantly lauded. Those facts point to a potential increase in ethanol production for biofuel manufacture in the future.
With the exception of what is sometimes called Marine or Recreation fuel, all ‘normal’ gasoline (85, 87 and 89 octane) that one buys at the gas station for use in regular, gasoline engine cars is typically 10% ethanol. Although not always labeled as such, these fuels are known as E10 to denote the fact that they contain up to 10% ethanol. In recent years higher blends of ethanol have been approved including E15. E15 gasoline contains anywhere between 10.1% and 15% ethanol and can be used in light-duty conventional vehicles of model year 2001 and newer.
Additionally, the last 30 years have seen the introduction of Flex-Fuel Vehicles (FFVs). E85 fuel contains varying amounts of ethanol that range anywhere from 51% to 83%, and can be used in FFVs. These vehicles that have been built to specifically use gasoline, or any blend of gasoline and ethanol up to 83%. FFVs have been available for purchase since circa. 1990.
Nebraska and E30
Research into the use of higher ethanol blends in conventional vehicles is ongoing, and one such study is currently taking place in Nebraska. Since 2019 the state of Nebraska has been piloting a program to investigate the use of E30 fuel in conventional vehicles. The safety and reliability of the use of 30% ethanol blends in such vehicles was largely uncharted before the study began. The first report on the findings was released by the University of Nebraska-Lincoln in February of 2021, and in October of 2022 Governor Pete Ricketts announced the expansion of the program. The study involves the use of E30 in up to 825 state owned vehicles, and their continued monitoring in terms of performance and maintenance costs.
The current Environmental Protection Agency (EPA) guidelines restrict the use of ethanol blends higher than E15 to just FFVs. The second phase of the Nebraska study is continuing to investigate the viability of the use of E30 in all vehicles. The goal is to provide evidence to support EPA regulatory changes to expand the use of higher blends in conventional vehicles. According to the Nebraska Ethanol Board (NEB) there are significant environmental gains to be made. The NEB says, “…, if only 10% of the 1.7 million registered non-FFVs in Nebraska used E30 instead of E10, ethanol consumption would increase by 18.5 million gallons per year and carbon emissions would decrease by 64,000 tons per year”. In August of 2022 the Nebraska legislature opened more incentives for biofuel retailers. Those who sell higher ethanol blends were invited to apply for tax credits that had been made available via legislative bill (LB) 1261e which was passed into law in April of 2022.
The motivation for states such as Nebraska to promote the use of ethanol – higher concentration blends in particular – in biofuels is clear. An increase in production of 18.5 million gallons of ethanol would represent a huge boost to the famers in the state, and as a result to the local economy as a whole. They see it as a massive win-win with the environment and the economy.
So what of the longer-term future? Politics and the environment will continue to be the drivers for the development of alternative, non-fossil fuel energy sources, and ethanol remains in competition with others such as electric and wind, but there are enormous incentives in middle-America for the continued rise of ethanol in the field. With the U.S. Department of Agriculture (USDA) reporting that around 45% of all corn production is being used for ethanol, it’s clearly here to stay.
https://incorn.org/icmc/programs/ethanol/
https://ethanolrfa.org/markets-and-statistics/annual-ethanol-production
https://ourworldindata.org/ukraine-russia-food
https://www.wilsoncenter.org/blog-post/forty-percent-world-food-programs-wheat-supplies-come-ukraine
https://ethanol.nebraska.gov/wp-content/uploads/2021/03/E30-Demonstration-FINAL-1.pdf
https://www.ers.usda.gov/topics/crops/corn-and-other-feedgrains/feedgrains-sector-at-a-glance/
