Ethanol producers are supportive of legislation sponsored by U.S. Sen. Amy Klobuchar that would boost the industry.
Klobuchar, D-Minn., told several ethanol leaders in a virtual meeting Friday that President Joe Biden’s new administration, including Agriculture Secretary Tom Vilsack, will also be helpful in passing legislation.
“It’ll be some great opportunities for me to advance some of our interests,” Klobuchar said.
Klobuchar said the focus needs to be on increasing the discussions about ethanol and renewable fuel, and getting relief for rural areas into COVID-19 relief legislation.
Ethanol production dropped last year due to the COVID-19 pandemic and decrease in demand, and production reached its lowest point since 2009, said Tim Rudnicki, the executive director of the Minnesota Biofuels Association. But throughout the crisis, the ethanol producers kept their workers employed.
Chad Friese, CEO of the Chippewa Valley Ethanol Company, said they took 50% of their facility offline in March 2020 while maintaining all of their jobs, but their efficiencies and revenue were down and they had increased costs to mitigate the spread of COVID-19 among workers. They operated in that mode for three months last year.
It all goes back to the local community, he said.
“If one of these plants shuts down and lays off 30 people, it impacts hundreds of people and families,” he said,
Federal biofuels reimbursement legislation last year wasn’t about making an ethanol plant financially whole, it was about returning value to rural Minnesotans and communities, he said. They’re still trying to climb out of the financial woes caused by the pandemic, including demand and production still being down, and the “hits just keep coming,” he said.
Randy Doyal, CEO of Al-Corn Clean Fuel, said they were “crushed” by the pandemic and had to slow down production because there wasn’t a market as gas demand decreased last year.
“Definitely painful, especially with a much larger plant, that much more cost involved in slowing down. … But we kept running,” he said.
He noted that Al-Corn, along with other companies, stepped up last year to switch to producing ethanol for hand sanitizer.
Klobuchar is working on the Renewable Fuel Infrastructure Investment and Market Expansion Act with U.S. Sen. Joni Ernst, R-Iowa, to authorize a $500 million grant program to install new fuel pumps or convert existing fuel pumps to E15 fuel and the Adopt GREET Act with U.S. Sen. John Thune, R-S.D., that would direct the EPA to update its greenhouse gas modeling for ethanol biodiesel to reflect the latest science.
“That is really important because I think you know the Biden administration … is going to be more interested in working on climate change issues than Trump did,” Klobuchar said.
Doyal called the Adopt GREET Act “a breath of fresh air.” Rudnicki said his association members see a greener energy future with ethanol, but they also recognize that it's only one tool available.
“It is the most immediately available and readily available-for-use tool,” Rudnicki said.
Klobuchar’s renewable fuel infrastructure legislation will help them get the product to consumers, he said. A recommendation from Gov. Tim Walz’s biofuels council was to provide adequate funding for infrastructure and there’s support in the Minnesota House to financially support retailers making the switch to E15, but it would be great if there was a way to leverage that into a larger amount, he said.
“This is a way to pivot to that greener future you’re talking about,” he said.
Brian Kletcher, CEO of Highwater Ethanol, also made a plea to Klobuchar during the meeting to get broadband internet into rural areas.
Klobuchar noted that there are a couple pieces of legislation to support broadband expansion and Biden is focused on infrastructure improvements.
“This is our moment to get broadband done,” Klobuchar said.