View From The Cab

By David Tollefson, Columnist

As I am one of the 316,000 corn farmers in the USA, the latest USDA/NASS forecast of the 2023 crop is supposed to be around 94 million acres, with an average yield of 177 bushels per acre.

On my farm, the forecasted average yield of 177 bushels per acre, which in past history is a reasonable expectation, may be in jeopardy this year because of the drought.

In the July 2023 issue of Successful Farming magazine is an interesting article with the above name, relating to the opportunities for ethanol going into the future With 30% to 40% of the total corn crop going into making ethanol, we corn farmers would like to see that continue.

Cassidy Walter, Business Management Editor of Successful Farming is the author of the article, quoted here in part, edited for length:

For decades the American ethanol industry has supported farmers, created jobs in rural communities, and displaced toxic chemicals in light-duty fuel tanks across the country. Today, the changing landscape of transportation has the industry looking for new opportunities in addition to the light-duty market to expand that legacy

“If we’re going to grow markets and grow demand for our products and agriculture in general, we’re going to need to develop new markets beyond the light-duty transportation sector,” says Monte Shaw, executive director of the Iowa Renewable Fuels Association (IRFA).

Shaw says the ever-increasing efficiency of vehicles, the growing demand for electric vehicles, and a cultural trend away from driving in general, is leading to a long-term decline in fuel consumption. To highlight new opportunities for ethanol, IRFA featured three emerging markets earlier this year at the annual Iowa Renewable Fuels Summit in Des Moines, Iowa.

“If we do this right, this is going to be a tremendous opportunity for farmers, and we’re going to see increased demand for their products,” he says.

*SUSTAINABLE AVIATION FUEL

Air travel is widely considered part of the “hard-to-electrify space” where biofuels are critical to lowering the carbon footprint of the industry.

Ethanol is one of several renewable products vying for market share in the sustainable aviation fuel (SAF) market. SAF producer Gevo says ethanol has the advantage of being the lowest-cost feedstock to producer SAF.

“However, ethanol itself from a typical ethanol plant can’t get a low enough carbon intensity reduction,” says Patrick Gruber, CEO of Gevo. “The vast majority of the carbon footprint of ethanol is due to the energy of production. So, this is very much about infrastructure as well.  That’s what makes this difficult.”

Gruber says before ethanol can be used as a feedstock, several pieces need to fall into place.

First, the supplying plant must be capturing and sequestering carbon, and powering the plant with renewable energy sources. That will lower the carbon intensity (CI) score of the ethanol enough that it can be used to produce SAF that meets the specifications for the tax credit in the Inflation Reduction Act. 

Second, he says it is important farmers get credit for their soil health practices.

Lastly, Argonne National Laboratory’s GREET model must be used to calculate the CI scores.

The U.S. Department of Treasury is currently writing regulations around the SAF tax credit, including what model may be used. Emily Skor, CEO of Growth Energy, a national ethanol trade association, says the industry is working with the department to ensure ethanol is not excluded as a feedstock.

“We want to be able to contribute in the hard-to-electrify spaces as well as for light-duty vehicles, and these are fantastic opportunities,” says Skor.

Despite current barriers to entry, Gruber says he is optimistic ethanol will be used to create SAF, and it will be a significant market for the ethanol industry. He says if the entire U.S. ethanol production capacity of roughly 17 billion gallons was suddenly diverted just to SAF production, it could fill the entire 10 billion-gallon SAF market.

*CLEARFLAME AND HEAVY-DUTY VEHICLES

While ethanol is traditionally used in gasoline engines, new technology has made it possible for ethanol to run in diesel engines.

“When you integrate our technology, you enable the diesel engine to become fuel agnostic,” says BJ Johnson, CEO and cofounder of ClearFlame Engine Technologies

Johnson says ClearFlame gives diesel fleets the advantage of maintaining the performance of diesel engines while saving money with ethanol.

“That’s a huge market opportunity for ethanol. It’s also a longer-term market opportunity for ethanol because the need for liquid fuels in those hard-to-electrify sectors is not going anywhere anytime soon,” he says

Heavy-duty vehicles are considered hard to electrify, and other fuel options such as biodiesel and renewable diesel are also directed at reducing their carbon footprint. Johnson says with the U.S. diesel market being roughly 60 billion gallons, all solutions are needed.

“The value of these bio-based fuels is only going up and up and up,” he says.

*PROTEUM ENERGY

The newest market opportunity the ethanol industry has its eye on is Proteum Energy.  Proteum aims to use ethanol to produce “clean hydrogen,” which is hydrogen produced with a low carbon intensity.

Through its steam non-methane reforming process, Proteum plans to crack low-carbon ethanol to produce hydrogen that has a negative carbon intensity, initially for hydrogen fuel cells for heavy-duty vehicles.

However, carbon capture and sequestration (CCS) is key again.  CCS is estimated to reduce the carbon intensity of an ethanol plant by roughly 30 points. 

John Rosenfeld, Proteum vice president commercial/strategic, says this is why the CCS pipelines proposed to crisscross the Midwest capturing carbon from ethanol plants and sequestering it underground are vital for the future of this market opportunity.

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From my very limited knowledge of CCS and associated ethanol/hydrogen proposals, the proposed pipelines to sequester carbon from ethanol plants are very controversial. I refer back to a column I wrote last September about standing in line at Big Iron at West Fargo to get a $15-foot-long hotdog, and visiting with the friendly guy behind me whose job was to help secure right-of-way for some of these lines.

So, stay tuned – these proposals are very exciting for us farmers, but there’s a lot of T’s to cross and I’s to dot before these things are reality.

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Please contact David Tollefson with thoughts or comments on this or future columns at: adtollef@hcinet.net