Biofuel supporters welcome Next Generation Fuels Act

Bill would reduce vehicle emissions in hopes of boosting long-term demand for corn for ethanol.

Jacqui Fatka, Policy editor

September 25, 2020

5 Min Read
ethanol plant with corn field in the front
Jim Parkin iStock

As legislators looking to the future of biofuels, Rep. Cheri Bustos (D., Ill.) introduced the Next Generation Fuels Act -- legislation that leverages greater fuel octane to reduce carbon emissions from transportation, improve air quality by reducing the use of harmful aromatics and increase demand for biofuels.

Fuels with greater octane levels are stabler and have the potential to make engines more fuel efficient, Bustos said in a news release. This legislation establishes a minimum octane standard for gasoline and requires sources of the added octane value to reduce carbon emissions by at least 30% compared to baseline gasoline. Furthermore, the legislation limits the use of harmful aromatics in meeting this new higher octane standard as well as in current-market gasoline.

“For the last three-and-a-half years, we have been forced to fight battle after battle and face this Administration’s broken promise after broken promise to ensure our country is meeting the full potential of biofuels,” Bustos said. “The Next Generation Fuels Act looks toward the future to make sure we bring an environmental lens to biofuels production in order to increase demand while reducing carbon emissions.”

“The Next Generation Fuels Act builds on the success of the Renewable Fuel Standard [RFS] in advancing corn growers’ commitment to providing the lowest-cost, most efficient and environmentally friendly fuel available,” National Corn Growers Assn. president Kevin Ross said.

Related:House advances RFS Integrity Act

“There has never been a more urgent need to adopt higher-octane, low-carbon ethanol blends in America’s fuel supply, as they are key to achieving clean, healthy air,” Growth Energy chief executive officer Emily Skor said. “We applaud Congresswoman Bustos for charting a path forward that will unleash clean, affordable ethanol to drive decarbonization in our nation’s transportation fleet and save consumers money at the fuel pump.”

The act establishes a new 98 Research Octane Number (RON) standard for gasoline and requires that sources of additional octane result in at least 30% fewer greenhouse gas (GHG) emissions than unblended gasoline. A new 98 RON would support mid-level blends like E25 and E30, which would generate new corn and ethanol demand.

Through advanced engine design features that take advantage of this new high-octane fuel, automakers will be able to increase engine performance and significantly improve vehicle fuel efficiency. The fuel standard allows the automobile industry to design future vehicles that meet national Corporate Average Fuel Economy standards at lower costs to the consumer for both vehicles and fuel.

Due to ethanol’s high octane rating, low-carbon, high-octane ethanol blends result in both additional fuel efficiency and significant GHG reduction benefits. Ethanol is also priced lower than gasoline, making it the most cost-effective octane source.

By requiring the new high-octane fuel to utilize low-carbon sources, the Next Generation Fuels Act will decarbonize liquid fuels as vehicle technologies advance. This requirement, coupled with a new limit on harmful aromatics content, ensures that progress already made to lower emissions will continue.

Using more petroleum-based sources to increase fuel octane would produce more carbon emissions, erase GHG reduction benefits from improved fuel economy and result in more emissions of harmful hydrocarbon aromatics, which degrade air quality and respiratory health.

“The Next Generation Fuels Act of 2020 provides a bold and innovative approach to reducing carbon emissions, improving engine efficiency and performance, protecting human health and removing the arcane regulatory roadblocks that have hindered the expansion of cleaner, greener liquid fuels,” Renewable Fuels Assn. (RFA) president and CEO Geoff Cooper said. “By establishing the roadmap for an orderly transition to high-octane, low-carbon fuels, this landmark legislation begins an exciting  new era in transportation fuels policy. As the world’s top supplier of clean, affordable, low-carbon octane,  the U.S. ethanol industry proudly and enthusiastically supports this legislation.”

RFA first began advocating for the creation of a national high-octane low carbon fuel standard in late 2018. As Cooper outlined the industry’s policy priorities at the February 2019 National Ethanol Conference, he stated, “RFA’s vision for the future includes not only strengthening the RFS but also pursuing a high-octane fuel standard,” including a requirement for 98 RON fuel, limitations on aromatics content, numerous regulatory fixes and other measures that would “assure air quality improvements, carbon emissions reduction and consumer savings for decades to come.”

“Even with increased sales of electric vehicles, it is broadly understood and accepted that our light-duty transportation fleet will continue to rely heavily on liquid fuels and internal combustion engines for decades to come,” Cooper said. “As such, we should be pursuing policy solutions that compel improvements in the environmental performance and efficiency of those liquid fuels and internal combustion engines. That’s exactly what Congresswoman Bustos’s bill does.”

The American Coalition for Ethanol (ACE) was one of many organizations that worked on the legislation with Bustos’s office. However, the organization voiced concern about the carbon accounting approach.

Brian Jennings, CEO of ACE, said, “While this legislation contains many of our top priorities, its approach to carbon accounting is flawed and undermines the investment many ACE members have made to reduce their carbon intensity.”

The legislation includes a new clean octane standard that limits aromatic compounds in gasoline and requires octane to be produced from clean sources -- defined as fuel with average life-cycle GHG emissions at least 30% lower than gasoline. The bill’s definition of industry “average” to determine the life-cycle GHG emissions of ethanol, also known as carbon intensity (CI), shortchanges many producers, Jennings said. As an example, he explained:

“Under this legislation, ethanol from a coal-fired ADM facility, whose fuel is similar to the CI of gasoline, would get the same access to the new octane market as the most efficient farmer-owned ethanol facility, whose carbon footprint is at least 50% cleaner than gasoline. In other words, the bill, as currently drafted, would perversely reward ADM for doing nothing to reduce the CI of the fuel produced in its coal-fired facilities and penalize many ACE member companies that have invested millions of dollars to install technology to reduce the CI of their fuel,” Jennings said. “We do not believe there is a good rationale for a carbon policy that treats ethanol with a CI that is hardly indistinguishable from gasoline the same as ethanol from a facility that is 50% cleaner than gasoline.”

About the Author(s)

Jacqui Fatka

Policy editor, Farm Futures

Jacqui Fatka grew up on a diversified livestock and grain farm in southwest Iowa and graduated from Iowa State University with a bachelor’s degree in journalism and mass communications, with a minor in agriculture education, in 2003. She’s been writing for agricultural audiences ever since. In college, she interned with Wallaces Farmer and cultivated her love of ag policy during an internship with the Iowa Pork Producers Association, working in Sen. Chuck Grassley’s Capitol Hill press office. In 2003, she started full time for Farm Progress companies’ state and regional publications as the e-content editor, and became Farm Futures’ policy editor in 2004. A few years later, she began covering grain and biofuels markets for the weekly newspaper Feedstuffs. As the current policy editor for Farm Progress, she covers the ongoing developments in ag policy, trade, regulations and court rulings. Fatka also serves as the interim executive secretary-treasurer for the North American Agricultural Journalists. She lives on a small acreage in central Ohio with her husband and three children.

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