Dinneen to ethanol industry: 'We need to show some outrage'

By Kris Bevill | June 29, 2011

Renewable Fuels Association President and CEO Bob Dinneen abandoned the podium and chose to speak off the cuff during his keynote presentation delivered to attendees of the International Fuel Ethanol Workshop & Expo on June 29 in Indianapolis. “I’m not sure that [a speech] is what we need right now,” he said. He briefly addressed the U.S. EPA’s recently finalized E15 label and complicated, ongoing ethanol policy negotiations in Washington D.C., and then focused his efforts on rallying the industry to move it forward during a difficult period.

Approximately 500 of the 2,000 or so registered attendees at this year’s annual conference are ethanol producers and one of the first questions posed to Dinneen was how the industry can continue its education efforts and battle the rampant misinformation campaigns being spread by anti-ethanol groups. Dinneen suggested that ethanol industry employees should ramp up their individual efforts to correct erroneous information and educate the general public. "We all need to correct the notion that it takes more energy to produce a gallon of ethanol than you get out of it. We need to dispel the notion that somehow we're driving the price of food while people ignore the skyrocketing prices of oil and ignore the role of speculators in commodity markets. We need to be the responsible ones and do that sort of thing,” he said. “It will be a challenge for all of us. But we need to do that. We need to show some outrage about the one-sided debate that's going on in Washington today.”

The ethanol industry needs to evolve for new feedstocks and technology in order to continue to displace greater amounts of petroleum, Dinneen continued. "That will not happen if we all just sit around our own breakfast tables, venting frustration with what's going on in Washington,” he said. “I ask for your help, because we certainly need it."

Dinneen’s call for action was likely inspired at least somewhat by the recent surprising approval by Senate members earlier in the month to immediately repeal the Volumetric Ethanol Excise Tax Credit. In nearly three decades of lobbying in Washington, Dinneen said that was the first time he’s lost a vote and further stated that the Senate’s decision did little more than to illustrate the anti-ethanol groups’ poisoning of legislators’ views on ethanol policy. The RFA believes the Senate’s VEETC vote does not indicate weakening support for ethanol, as other groups have suggested, but rather highlights the dysfunction of the current political workings of the D.C. “I’ve never seen the level of discourse as pitiful as it is right now,” he said.

It is clear that ethanol policy will change, but the exact course it will take remains unknown. In his comments, Dinneen referenced recent reports that a compromise is being reached between Sens. Dianne Feinstein, D-Calif.,--who has proposed an immediate repeal of VEETC and the ethanol import--and John Thune, R-S.D., and Amy Klobuchar, D-Minn.,--who have proposed an immediate reduction in VEETC rather than total elimination. “’Deal’ is a relative term,” he said, adding that negotiations are ongoing but could be resolved by August. The ethanol alliance, consisting of the RFA, Growth Energy, the American Coalition for Ethanol, and the National Corn Growers Association, have thrown their support behind a variable tax credit option in exchange for more support for biofuels infrastructure. Dinneen said the solution is not ideal, but ethanol producers have expressed confidence that the renewable fuel standard will continue to drive demand for their product even without financial incentives. Dinneen does not expect the 54-cent-per-gallon ethanol import tariff to be renewed after this year, but indicated the lapse of the tariff likely wouldn’t lead to an immediate glut of Brazilian ethanol imports because of recent supply shortages there.

Consumer access to E15 is a vital step toward opening the marketplace and while the RFA continues to believe the fuel should be allowed for use in all vehicles, Dinneen said they can live with the partial approval. The EPA recently issued its final E15 label rule, but still needs to register the fuel and address state regulatory issues before it can become legally available. Dinneen said he expects registration to be complete later this summer. Other issues confronting the industry include the need for greater numbers of flex-fuel vehicles and support for cellulosic ethanol projects. Dinneen touched on both of those items in his closing comments, calling for support for what will likely be politically challenging efforts in the coming months. “Everybody needs to be a part of this fight,” he said. “I need you to make the magic happen again. You need to help us make it happen in D.C. and awaken them to the growing threat that we face by the failure to immediately address our energy issues."