California Rules Change Could Mean Big Boost For Ethanol
The California Air Resources Board says it will re-evaluate methods for calculating the carbon concentration of corn ethanol. Ethanol producers have been pushing for the decision for some time—even going so far as to sue CARB over what the lobby claims is an overestimation of the land-use impact of producing the corn that serves as the feedstock.
The dispute originates from a 2007 executive order by California Governor Arnold Schwarzenegger to enforce a Low Carbon Fuel Standard on gasoline and other fuels sold in the state. The law is scheduled to go into effect in 2011, mandating a 0.25 percent decrease in greenhouse gas emissions from fuel sold next year—with that number gradually climbing to at least 10 percent by 2020.
Oil refiners have asked the California to delay implementation of the standard, claiming they aren’t yet ready to meet the decrease and that purchasing the offsets required for compliance could dramatically increase the cost of gasoline in the state.
But the ethanol lobby responds that recent federal approval of E15-blended ethanol in gasoline could help refiners meet the standard—if only California would adjust its calculations to reflect a net decrease in carbon emissions for corn ethanol when it is used in place regular gasoline. Currently, Midwest-produced ethanol is rated as the worst greenhouse gas-polluting fuel by the California Air Resources Board—thanks largely to the estimated indirect land-use change (ILUC) impacts associated with growing biofuels. But how to go about calculating these negative effects has been a source of controversy since the LCFS was first enacted.
“There’s no systematic tracking of the pollution from either growing corn and soybeans or from refining those crops into ethanol and biodiesel,” said John DeCicco, senior lecturer at the University of Michigan School of Natural Resources and Environment, in an interview with HybridCars.com. “So there’s no way to know the true environmental pedigree of most biofuel now in use, whether in its most common form as ethanol blended into gasohol or even where it might be available as E85 or biodiesel from a dedicated pump.” DeCicco believes the LCFS is “delusional policy” because the “key numbers are basically made up.”
Study Created Doubts About CARB’s Land-Use Penalties
This year, the Renewable Fuels Association began trumpeting a Purdue University study conducted in conjunction with Argonne National Lab that found the ILUC impact of corn ethanol to be half that of CARB’s current estimates. After months of hearings and review, CARB recently agreed to incorporate the Purdue study’s findings into its analysis—though it remains unclear just how much that will impact the final numbers.
Ethanol producers would like to expand local production in California, which would further cut the nominal carbon impact of E15—and soon, if the industry gets its way, move to a 20 percent blend of ethanol. That would be a big windfall for the biofuels sector, which currently counts on California for at least 15 percent of its revenue.
Still, the rules change could end up being largely moot for corn growers and refiners if the tariff on imported Brazilian sugar ethanol is lifted next year. Even accounting for the carbon cost of importation, Brazilian sugar ethanol is several-times less greenhouse gas-intensive than locally produced corn ethanol—meaning that oil refiners would have a major incentive to look overseas in their efforts to blend their way to LCFS compliance.
A spokesman for the Brazilian Sugarcane Industry Association issued a statement last week praising the CARB decision.