Industry insiders look at the state of ethanol
Jeff Broin is CEO of Poet, the largest U.S. ethanol producer, with a network of 26 plants in seven states.
> Encouraging Prospects
Our nation is awash with grain, we have idle ethanol production capacity and energy prices are skyrocketing. Although our industry has only just emerged from some difficult times, clearly the pieces are in place for ethanol to make tremendous strides in the U.S. fuel market in the future.
The only thing preventing the ethanol industry from making a large dent in petroleum's dominance in the fuel market is regulation—specifically, the 10% ethanol blend cap that is current law in the United States. However, the Environmental Protection Agency is now considering allowing blends of up to 15% ethanol. That would allow us to meet the government's renewable fuel goals under the Renewable Fuels Standard (RFS2) and begin the commercial production of cellulosic ethanol.
The Farmer Politician
Bill Northey is Secretary of Agriculture for Iowa, the nation's top ethanol-producing state.
> Regulatory Uncertainties
I expect that existing ethanol plants will continue to operate, but with tight margins in the industry, I don't expect many new plants to be constructed in the short term. Plants are investing in new technologies to make production even more efficient. It is important that any new regulation of carbon take this increased production efficiency into account. I have concerns about some of the indirect land-use proposals that have been made because they use outdated information regarding efficiencies.
- OCTOBER 2009