A View from the Hill

How Much? How Soon?
By Bob Dinneen | March 01, 2006
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President Bush's State of the Union address had a profound impact on the debate in this country about the production and use of renewable fuels, not because he used the bully pulpit of the State of the Union but because of the message he sent.

By boldly declaring that America was "addicted to oil" and singling out ethanol as a means to help lessen our addiction, the president changed the debate in Washington and the country from, "Should we use renewable fuels?" to "How much should we use?" and "How fast can we produce it?"

This is an important shift and should be a call to arms to all those in the ethanol and renewable fuels industry. This is an opportunity for ethanol to go beyond just a blending component and become a true alternative to gasoline.

The president laid forth an aggressive plan to reduce Middle East oil imports by 75 percent by 2025. According to information from the Energy Information Administration, Middle Eastern imports will be 2.3 million barrels a day at that time. If we assume the 75 percent reduction the president proposes, we will have to find a way to displace 1.8 million barrels of oil daily. Because refiners only get a little more than half a barrel of gasoline from each barrel of crude oil, our real target is about a million barrels per day.

Today, the ethanol industry is producing about 275,000 barrels per day, with another 130,000 barrels per day of new capacity under construction. So, we're already almost halfway there! But we can do more. We can likely meet the goal the president established well before 2025.

America can no longer afford to gluttonously consume oil. We have a domestic renewable fuels industry that is growing at a remarkable pace and is prepared to meet and exceed the challenges the president has put forth.
So as the debate now turns to the size and the speed with which we can displace significant quantities of imported oil, the U.S. ethanol industry stands ready to help end America's addiction.

Bob Dinneen
President and CEO
Renewable Fuels Association