Halfway Through, Not Half Bad

By Ron Lamberty | July 11, 2013

There is a risk, when writing a column like this one, that what you write for deadline will be obliterated by events that take place in the time that passes before the article is published. (At least that’s the excuse I usually give editors for late submissions.) Personally, I also worry about messing with the “mojo,” or jinxing something by mentioning it. Sport superstitions die hard, I guess.

With a nod to fate, writing in early July, I’ll cautiously say that the 2013 looks to be a good year for the ethanol industry. Certainly better than most predicted.

Early in the year, when the Hill was abuzz with talk of renewable identification numbers (RINs) and “RIN-sanity,” fueled by Big Oil mis-RINformation, we countered with the explanation that RINs are free. When refiners blend ethanol with gas, the RIN is theirs. Free. Like a proof-of-purchase seal. Oil industry representatives tried to convince reporters that RINs are “permits to blend ethanol,” when the truth is they’re the opposite. They’re permits to NOT blend ethanol. And for a change, a few reporters called Big Oil on the misrepresentation.

A better result of all the RIN talk was that independent petroleum marketers became curious about them. When we talked with marketers at spring trade shows, they asked how they can get their hands on these dollar-a-gallon RINs they’d heard so much about. Petroleum marketers do backflips over a nickel a gallon, so RIN values are definitely an incentive to sell more ethanol and collect as many RINs as they can.

In the process, those marketers are also proving that, again, contrary to Big Oil talking points, station owners CAN sell, and drivers will buy, more than 10 percent ethanol. Marketers have already torn down the blend wall that Big Oil portrays as impenetrable. At a Hill briefing held by Iowa Renewable Fuels Association and ACE at the Capitol Visitors Center, one of those marketers, Bruce Vollan, who owns a station near Baltic, S.D., told a packed house that he was selling between 18 and 28 percent ethanol each month at his store, and has been for several years, without a single complaint or repair bill. Congressional staff and media in attendance paid rapt attention and seemed stunned at the possibility they had been misled by Big Oil.

Media outlets that haven’t had a bad thing to say about oil or a good thing about ethanol for months ran some interesting stories in June.  A Forbes article cautioned that the shale oil boom (which makes the renewable fuel standard unnecessary, according to Big Oil) is more tenuous and more reliant on high oil prices than the oil industry portrays it. The New York Times ran an article that explained how auto company engineers think they can use the higher octane of higher ethanol blends to meet the clean air and mileage regulations of the future.

And late in June, the Supreme Court rejected American Petroleum Institute’s appeal of a lower court ruling that said Big Oil couldn’t sue the U.S. EPA over approval of E15. Although the appeal was actually over the rather mundane subject of standing, API’s press releases and comments leading up to the High Court ruling portrayed the case as a referendum on E15 safety. Essentially, Big Oil used the legal process as another piece of their much larger ethanol smear campaign. Hopefully, some of their own misinformation will lead people to the conclusion that the Supreme Court has ruled that it’s safe to use E15.

When anti-ethanol momentum appears to be slowing down, it’s usually just reloading and catching its breath.  As long as ethanol is a threat to entrenched oil interests, they will continue to threaten ethanol, and I don’t believe they’ve ever felt more threatened.

I’m not ignoring the likelihood that ethanol will be aggressively and unfairly attacked for the remainder of 2013. I’m just becoming more confident that the truth stands a decent chance of prevailing.

Author: Ron Lamberty
Senior Vice President,
American Coalition for Ethanol