After experiencing one of the best years in the industry’s history, 2024 will be “one of the most pivotal and consequential years” the ethanol industry has ever experienced, Renewable Fuels Association President and CEO Geoff Cooper said Tuesday.
“Several policy decisions expected in next three to six months will shape the future course of the ethanol industry for years—and perhaps decades—to come,” Cooper said at his organization’s National Ethanol Conference in San Diego.
In addition to the upcoming presidential election, he outlined several policy and regulatory questions ahead, including:
- Will the Inflation Reduction Act’s clean energy tax credits be implemented in a way that properly recognizes the climate benefits of renewable fuels?
- Will U.S. farmers and ethanol producers be allowed to fully participate in opportunities like sustainable aviation fuel?
- Will more state and federal policymakers choose electric vehicle mandates and bans on internal combustion engines?
- Will Congress take action to allow year-round E15 sales nationwide, or will that be left to individual states to initiate?
- What happens with the Renewable Fuel Standard after 2025?
- Will government officials and permitting authorities embrace the economic and environmental benefits of carbon capture, utilization and sequestration technologies?
New clues to the potential market for sustainable aviation fuel could come as soon as March 1 when the Biden Administration is expected to finalize carbon intensity standards for SAF feedstocks and a new tax credit, known as Section 40B, that was created by the Inflation Reduction Act.
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The Treasury Department, which is developing rules for IRA tax subsidies, announced in December that it would allow use of the Argonne National Laboratory’s GREET model for determining eligibility for the 40B credit, but with modifications that will likely take into account climate-smart farming practices. The GREET model was favored by the biofuel and airline industries.
“The modified GREET model will either help open the door for U.S. agriculture and ethanol producers to participate in the SAF market, or it will lock out the highest-volume, lowest-cost feedstocks and assure the failure of the administration's ambitious SAF goals,” Cooper said.
Cooper said the “GREET model alone” won’t guarantee a bright future for corn ethanol in the SAF market because ethanol producers will need to shave 25-30 carbon intensity points before corn ethanol-to-jet qualifies for 40B. “But getting the model right would be a big first step” toward opening a “potentially enormous opportunity for America’s farmers and ethanol producers.”
Looking ahead, Cooper said “Lowering the carbon intensity of ethanol is the single most important thing renewable fuel producers can do to secure an even brighter future for the industry,” he said.
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