Dinneen: State of the ethanol industry remains strong

By Renewable Fuels Association | February 16, 2016

Speaking before more than 1,000 attendees at the National Ethanol Conference in New Orleans Feb. 16, Renewable Fuels Association President and CEO Bob Dinneen declared, during his annual state of the Industry address, that the domestic ethanol industry remains strong and touted its ability to successfully navigate the vagaries of the markets and overcome the perils of policy uncertainty.

“The strength of the U.S. ethanol industry is seen in its record production—14.7 billion gallons, its record blending demand—13.75 billion gallons, record feed production—40 million metric tons, and record greenhouse gas reductions—41.2 metric tons,” said Dinneen. “Those aren’t the stats of an industry in retreat, that’s an industry confident, defiant, and prepared to weather any storm.”

Dinneen called the U.S. ethanol industry the “cornerstone” of the rural economy, noting that it added $44 billion to the nation’s gross domestic product and paid $10 billion in taxes last year. He drew a sharp contrast with what he characterized as the “boom and bust cycles” of oil extraction which, he said, can wreak havoc on economically-vulnerable communities.

“Margins might be tight, but you remain committed to your communities and are making an immeasurable difference in the lives of your neighbors and the pocketbooks of all Americans,” Dinneen said. “Your fuel is renewable, and so are the jobs you require, the investment you’ve made and the purchases you make every day, no matter the economic climate.”

Dinneen pointed out that in 2015 the U.S. ethanol industry exported 836 million gallons with a value of $1.78 billion and representing 5.7 percent of domestic ethanol production. He noted that last year’s export number was identical to 2014’s and was tied for the second-highest total on record. Dinneen said RFA will continue to focus on expanding export market opportunities and mentioned that the organization had been awarded a grant through the Department of Commerce to promote ethanol in international markets.

“I am very pleased to have representatives from China, India, Brazil, Mexico, and Peru here today to learn the advantages of increased ethanol use and make important and lasting commercial relationships,” Dinneen said. “With our collective efforts to enhance export opportunities, we will grow demand while at the same time enabling our foreign partners to address pressing pollution and climate change issues in their countries.”

In the address, Dinneen referenced this year’s NEC theme, “Fueling a High Octane Future,” and told attendees that whenever ethanol is marketed in the U.S. or international markets, it is octane that it is being traded. He also highlighted the economic and environmental benefits for refiners in using ethanol as a fuel additive.

“Not too long ago refiners produced all the octane they needed at the refinery from petroleum. But refinery processes to increase octane are energy intensive and costly, and yield additives that are highly toxic,” Dinneen said. “Ethanol is cleaner, cheaper, and carbon neutral. Refiners can use it to meet minimum octane specifications while extending the barrel to maximize fuel production.”

Dinneen noted that Jack Gerard, president and CEO of the American Petroleum Industry, took a very myopic view of the energy landscape when, during his annual State of American Energy Speech last month, he referred to the RFS as a “relic of our nation’s energy past.”

“It’s not the RFS that is a ‘relic of our nation’s energy past,’” Dinneen said. “It is the very notion that prosperity can be driven by petroleum without regard for the environmental, economic, or national security implications of that dependency that is the ‘relic’ world leaders need to recognize and relegate to the trash heap of history.”

Dinneen’s full remarks, as prepared for delivery, can be found here.