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Issue link: https://read.dmtmag.com/i/108236
global energy leader. Oil shale in the Western United States is estimated at more than 800 billion barrels, or nearly three times the proven reserves of Saudi Arabia." Gerard also said after his address that the most important thing that Congress and the Obama administration does is "no harm." He cautioned them not to act in any way that would impede or discourage the development in natural gas right now. "We are at the crossroads of a great turning point in our nation's history…to realign the energy axis toward the West and into our own control," he said. "North America could become self-sufficient in liquid fuels in roughly 12 years." He also put emphasis on tax policies that allow economic activity and not to increase the cost of doing business in the country. Renewable FuelS Just a few years ago, renewable fuels, like ethanol and biodiesel, dominated the alternative energy discussion. The AEO2013 projection is less optimistic than the AEO2012 report about "the ability of advanced biofuels to capture a rapidly growing share of the liquid fuels market." This prompted some responses from groups such as the Renewable Fuels Association (RFA) and the American Coalition for Ethanol (ACE). "The EIA has consistently proven Yogi Berra right, 'the future is hard to predict.' The agency has consistently underestimated biofuels production and the ability of the market to respond to progressive energy policy," said Bob Dinneen, president and CEO of RFA. "Ten years ago, the EIA Outlook said we could only make 3.4 billion gallons of ethanol in the U.S. by 2020. Congress deemed that unacceptable and passed the RFS to encourage alternatives to oil, and they were right," said ACE executive vice president Brian Jennings. "When the RFS (Renewable Fuels Standard) was first written, it underestimated that only 5 billion could be put in place, but we're already ten years ahead of schedule," said ACE senior vice president Ron Lamberty. "We're importing less oil and biofuels is included in the reasons why," he said. As far as the last presidential election, Jennings said ACE is feeling confident with keeping the RFS intact. "President Obama has given us his long standing support, even since he was a senator," said Jennings. "In Congress, there's support in the Senate, which is pivotal." He said there is support in the House, but historically, it's never championed ethanol the way the Senate has. For instance, a trade newspaper on the Hill had recently reported that the House is putting ethanol on trial. "But we're ready for the battle and to show how the RFS is working," said Jennings. To do that, he said ACE is showing how ethanol does three things: • No. 1: Reduces foreign oil imports "In 2012, reliance of foreign went to 40 percent from 60 www.npnweb.com n NPN Magazine percent," he said. "It (ethanol) is not the only reason, but it's more than a coincidence." This was the primary purpose of the RFS back when it was written, and Jennings said that it is delivering on this. • No. 2: Biofuel benefits the U.S. "It brings down the price of wholesale fuel by a little over a dollar," he said, and, "it provides choices at the pump." • No. 3: Job creation "While we struggle nationwide, our industry is a success story," Jennings said and explained that because there's a strong demand for commodities, "there's no joblessness in our industry." ACE is also trying to reach out to the petroleum marketers and talk to them about how ethanol can help their businesses. "From a marketer's standpoint, it's less about policy and more about buying equipment," said Lamberty. "They're not making a lot of money on fuels." However, ACE is trying to communicate to the independents and small chains to recognize the benefits of biofuels, such as it being an octane enhancer and has the potential to draw more people in. "The ethanol industry was forcing this," Lamberty said. "But it's better to prove how marketers can make more money." Plus, dispenser manufacturers are beginning to make more dispensers cleared for higher blends. On the biodiesel front, things are looking brighter in 2013. Despite the biodiesel tax credit being expired all last year, Congress voted to reinstate it when passing the yearend fiscal package. Ben Evans, spokesman for the National Biodiesel Board, expects this positive momentum to continue, "There is strong biodiesel support across the country." The tax break is also a retroactive reinstatement for a dollar-a-gallon credit going back to January 2012, when it expired. This retroactive credit is approximately a $1 billion benefit to the blenders. Evans said the Obama administration, the EPA and the USDA are all supportive of biodiesel and there have been demand and product growth increases in the last few years. Under the RFS, biodiesel is set to rise next year, from one billion to 1.28 billion gallons. The AEO2013 predicts that the sales of alternative-fuel vehicles will be lower than proposed in the AEO2012. "The majority of the reduction relative to AEO2012 is reflected in sales of flex-fuels vehicles (FFVs), which in 2035 are about 1.3 million, or less than one-half the 2.9 million FFC sales in the AEO2012 Reference case," said the EIA in its report. "FFVs are necessary to meet the Renewable Fuels Standard, but the phasing out of CAFE (corporate average fuel economy) credits for their sale and limited demand from consumers reduce their market penetration." Both the NBB and ACE said their organizations are engaging in constructive dialogue with the automotive industry to make sure the car companies are reaching the target put in place by the RFS. January/February 2013 25