Despite Domestic Policy Disputes, Biofuels Retain Significance on the World Stage

November 8, 2019

The domestic biofuel industry has taken some harsh hits in recent times, as evidenced by the heated disputes over biofuel policies and the questionable restraints the current administration seems to be placing on the sector’s ability to grow. But when a wider, more global view is taken, the prospects for the ethanol industry’s growth are strong and vigorous.

In the face of ongoing and harsh changes to our climate, the world is seeking lower carbon energy that will produce fewer greenhouse gas emissions (GHGs) that trigger those changes. By offering fewer emissions than those generated by our current reliance on carbon-based, fossil fuels (for example, coal, gasoline and diesel fuel), biofuels help stem these changes while enabling more secure adaptation to them.

As noted during the first-ever Global Ethanol Summit in Washington, D.C. last month, global ethanol production reached more than 29 billion gallons last year, a six-fold increase over the past 20 years.

More than 60 nations now have policies in place aimed at promoting ethanol production. Since 2017, 10 have announced either new policies or significantly expanded their existing policies, including markets like China and Brazil.

Among the principle drivers that will impact the ultimate growth of the global ethanol market is the fuel’s ability to reduce emissions. As nations seek to meet their commitments under the Paris Agreement, ethanol is an option that can reduce the carbon intensity of their transportation fuels. The USDA says that by 2022, with the efficiency of production continuing to improve, corn ethanol is expected to reduce greenhouse gas (GHG) emissions by 50 percent compared to conventional gasoline.

It’s important to note that ethanol blending also represents significant health benefits through improved air quality. The lower-emitting biofuel replaces costly and harmful aromatics and MTBE – a blending component of gasoline used as an oxygenate to raise the octane level in the fuel mix. Fewer emissions result in reduced respiratory and cardiac illness, a lower mortality rate, and a big reduction in national health care costs.

Blending also has another plus-side on the financial ledger, depending on relative fuel prices and petroleum refinery optimization. It can provide economic benefits to countries with or without the ability to produce biofuel feedstocks like corn, sugarcane and cassava. For countries with feedstocks available, ethanol policies economically support feedstock producers and complementary industries, boosting rural development.

The benefits of biofuels increase as the blend rate increases. E-10 (10 percent ethanol) has reliably shown its environmental and economic value. E15 or higher blends would only boost those benefits. The United States, Brazil, Paraguay, Thailand and others have proven that mid-level ethanol blends are safe for unmodified engines and are becoming widely available.

Of course, these fuels of the future must also be sustainably produced, a point of emphasis by the Global Bioenergy Partnership (GBEP). This international alliance, with some 80 partners and observers representing governments and international organizations, has been working since 2006 to facilitate the sustainable development of bioenergy.

To that end, a set of 24 sustainability indicators have been agreed upon by GBEP members to facilitate bioenergy development, including the production of biofuels. To date, the indicators have been implemented in 14 nations. The indicators are equally divided under the three pillars of sustainable development – environmental, social and economic. Their measurement at the national level is intended to inform decision making and facilitate the sustainable development of bioenergy.

Measured over time, these indicators will show continuous progress towards or away from a sustainable development path, as determined nationally.

Given the benefits of ethanol and other biofuels recognized around the world, we urge domestic stakeholders to reach out to policymakers and call on them to quickly resolve the ongoing dispute currently plaguing the sector. Only then can we get back to promoting a deliverable that can boost rural America and this nation’s efforts to deal with changing climate.

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