Ethanol: A Success Story Worth Repeating

Reprinted with permission of Gary Truitt and HosierAgToday.com

Gary Truitt

The terrorist attacks on September 11, 2001 not only shocked America into the real and present danger of Middle East terrorism, it prompted the U.S. Government to address the issue of our dependence on imported oil. For over 2 decades, the U.S. had been lulled into complacency by a low cost, free-flowing supply of oil from the Middle East and North Africa. Even the energy crisis of the Carter administration failed to generate a change in U.S. policy when it came to our fuel supply. Meanwhile, international oil companies and Saudi Arabian shieks made billions of dollars off American consumers. Then the American farmer came forth with a solution.

The ethanol industry could provide a home-grown, energy source that lessened our dependence on foreign imports, replaced a cancer-causing chemical as the octane portion of gasoline, and reduced tail pipe emissions. It would also provide a new source of demand for corn and raise prices received by corn farmers. There was only one problem: the oil monopoly would not let this product be sold at their fuel stations.

Then a few visionary lawmakers in Congress, led by Indiana Senator Richard Lugar, crafted the Renewable Fuel Standard (RFS). This was a government mandate that forced open the fuel oil market to renewable fuels. With this opportunity, the ethanol responded with rapid and impressive expansion. Indiana was the poster child for this expansion with production plants springing up beginning in 2006 in Jasper County.

Today, Indiana boasts 13 such plants and produces over 1.1 billion gallons per year, making us the 5th largest-producing state in the U.S. Almost all of the plants are in rural areas producing jobs and economic activity for those communities and grinding almost half of the Hoosier corn grown every year. By almost any measure, in Indiana, and for all of the nation, ethanol is a success story.

Now we have the chance to repeat that success. An increase in the amount of renewable fuel blended into gasoline has been approved. It has been proven that a 15% blend of ethanol in a gallon of gasoline is safe, and sustainable. Auto makers and engine manufacturers have given their approval, and even President Trump has given his support. Yet once again, oil companies are refusing to offer E-15 to consumers. In addition, the EPA is refusing to eliminate an antiquated regulation that prevents the sale of E-15 during summer months.

Without action by the government, on June 1, E-15 will not be available to motorists in Indiana and most Midwestern states. This lower cost fuel will leave the market just as retail gas prices spike above $3 per gallon. What is behind this foot dragging by the EPA? Big Oil, of course, is using its political muscle and dis-information campaign to block E-15 from entering the fuel mainstream.

Not only would increased ethanol use benefit the pocketbooks of motorists, it would help the bottom lines of corn farmers. It has been estimated that a move from the current 10% blend in gasoline to 15% would increase corn prices by 25 cents per bushel (less than 1/2 cent per pound). In Indiana, it would also likely lead to the construction of another ethanol plant resulting in even higher prices for farmers in that area.

This should be a no-brainer, but it is not going to happen without a push from corn growers and consumers. A decade of success should be repeated with continued growth of the ethanol supply in our nation’s fuel supply. Not only do we need to “drain the swamp” in Washington, we need to remove the oil slick that lets Big Oil and its partners, the Islamic governments of the Middle East, control the U.S. fuel market.