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8/10/2019 Newman Ethanol Policy and Trade Biofuels International 14 Ghent_final
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U.S. Ethanol Policy and Trade
Biofuels International Conference
GhentSeptember 24, 2014
Doug Newman
International Trade Analyst
U.S. International Trade Commission
500 E St. SW
Washington, DC 20436
202-205-3328
douglas.newman@usitc.gov
mailto:douglas.newman@usitc.govmailto:douglas.newman@usitc.gov8/10/2019 Newman Ethanol Policy and Trade Biofuels International 14 Ghent_final
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The analysis and views expressed in this presentation are solely
those of the author and do not necessarily reflect those of the
U.S. International Trade Commission or any other U.S.
government agency.
Disclaimer
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U.S. International Trade Commission
Independent, quasi-judicial federal agency
Investigates and studies trade issues Section 332 (Probable effects; Competit iveness)
Title VII (AD, CVD) Section 337 (IP)
Advisory U.S. Trade Representative
Senate Finance; House Ways and Means
Publishes the Harmonized Tarif f Schedules
Determined CBI ethanol dehydration quota
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Major Points
Global policies affect trade flows
Major U.S. policy changes occurred in recent years
U.S. policy is under review
Uncertainty and risk continue
Exports have increased in importance to U.S. producers
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Topics Global overview
U.S. market
Policy elements and changes
Implications for U.S. trade
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Global Overview
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0
5
10
15
20
25
30
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Billion
gallons
Fuel Other (beverage, industrial)
Source: Estimated based on data from LMC International.
Note: Data for 2014 are pro jected.
Global ethanol production growth, driven by fuel use, levels off in 2011
8/10/2019 Newman Ethanol Policy and Trade Biofuels International 14 Ghent_final
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0
5,000
10,000
15,000
20,000
25,000
2006 2007 2008 2009 2010 2011 2012 2013 2014
Milliongal
lons
US Brazil EU China All other
Source: BEA; EIA; FAS; MAPA; Eurostat; LMC International.
Note: Data for 2014 are pro jected.
US and Brazil dominate global ethanol production, but others emerge
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0
5,000
10,000
15,000
20,000
25,000
2006 2007 2008 2009 2010 2011 2012 2013 2014
Milliongall
ons
US Brazil EU China All other
Source: BEA; EIA; FAS; MAPA; Eurostat; LMC International.
Note: Data for 2014 are pro jected.
Growth in global fuel ethanol consumption slows: major markets mature and face
constraints, new markets relatively small
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Global ethanol imports generally rise and diversify during 2003-2013
0
500
1,000
1,500
2,000
2,500
3,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Milliongallons
USA EU Canada Japan Central America Brazil All other
Source: GTIS; LMC International.
Note: Includes all ethanol in HS heading 2207. Quantities include denaturants. EU impor ts understated during 2010-2012, as the bulk of
imports were classified in HS heading 3824.
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0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
US EU Brazil World
Importshareofconsum
ption(percent)
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Source: Calculated based on data from GTIS; LMC International.
Ethanol import penetration is greatest in EU market
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Global ethanol exports remain dominated by Brazil and the United States
0
500
1,000
1,500
2,000
2,500
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Milliongallons
United States Brazil Central America All other
Source: GTIS; LMC International.
Note: Includes all ethanol in HS heading 2207. Quantities may include
denaturants.
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8/10/2019 Newman Ethanol Policy and Trade Biofuels International 14 Ghent_final
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U.S. Market
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Major U.S. Policy Elements
Domestic policy Renewable Fuel Standard (RFS)
California Low Carbon Fuel Standard (LCFS)
EPA E15 waiver
R&D grants and loan programs (BRDI, BCAP, REAP)
Trade policy Duties
Duty drawbacks Export promotion
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Major U.S. Policy Changes
Expiration of the Volumetric Ethanol Excise Tax Credit (VEETC)
Expiration of the Other Duty or Charge (ODC)
Expiration of CBI dehydration quota
Expiration of Cellulosic Producer Tax Credit
Expiration of Biodiesel Blenders Tax Credit
Lowering of RFS RVO for 2014
California Low Carbon Fuel Standard on pause while being revamped
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0
5
10
15
20
25
30
35
40
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Billiongallon
s
Undifferentiated renewable Cellu losic Undiff erentiated advanced Biomass-based diesel
Source: Energy Policy Act; EISA.
Note: Data for 2006 and 2007 represent the Renewable Fuel Program. Areas represent original ethanol-equivalent volume requirements.
The Renewable Fuel Standard drives the U.S. market
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0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
Milliongallons
Production Consumption
Source: U.S. Department of Energy, Energy Information Administ ration.
The RFS resulted in dramatic ethanol market growth in the mid-2000s; growth slows in 2011
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California Low Carbon Fuel Standard
Not part of the RFS
Goal is to lower carbon intensity of transport fuel by 10% by 2020
Carbon credit system with carbon intensity premiums
Sugarcane ethanol generally lower than corn ethanol
However, U.S. corn ethanol producers react with adjustments
Effectiveness constrained by blend percentages
Compliance schedule on hold as regime is amended
Urgency for imports of sugarcane ethanol postponed
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HTS subheading Duties/Other duty or charge Trade preference programs
Column 1 Preferential
2207.10.6010
(undenatured)
2.5 % ad
valorem
Free AGOA, ATPA, Australia, Bahrain, CAFTA-
DR , Canada, CBERA, Chile, Colombia,
GSP+ (least-developed), Israel, Jordan, Korea,
Mexico, Morocco, Oman, Panama, Peru,
Singapore
2207.20.0010
(denatured)
1.9 % ad
valorem
Free AGOA, ATPA, Australia, Bahrain, CAFTA-
DR, Canada, CBERA, Chile, Colombia, GSP+
(least-developed), Israel, Jordan, Korea,
Mexico, Morocco, Oman, Panama, Peru,
Singapore
9901.00.5000 (fuel use)
In addition to ch. 22 duties.
EXPIRED AT THE END
OF 2011. INACTIVE;
COULD BE
REINSTATED.
14.27 cents per
liter
(54 cents per
gallon)
Free GSP+ (least-developed), ATPA, CAFTA-DR,
Canada, CBERA, Colombia, Insular
Possessions, Israel, Mexico, Panama, Peru
U.S. Fuel Ethanol Duties
Source: HTSUSA.
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CBI Dehydration Quota Conferred origin for ethanol dehydrated from imported hydrous
feedstocks
7% of U.S. consumption=>No local feedstock required
Additional 35 million gallons=>30% local feedstock blendrequired
Unlimited amount=>50% local feedstock blend
Applied to CBERA, DR/CAFTA, U.S. Insular Possessions
First-come, first-served
DR/CAFTA reservations for El Salvador (phase in to 25 mgy+)and Costa Rica (31 mgy+)Does not increase the quota;unfilled amount not reassigned
Expired at the end of 2011 along with the ODC. Would bereactivated if the ODC is reimposed.
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Duty Drawbacks Jet fuel duty drawbacks facilitated direct imports of
anhydrous ethanol from Brazil during 2004-2008 andlikely mitigated the bulk of import duties.
Drawback provisions were amended to require ethanol inthe exported product after Oct. 1, 2008 in order to receivedrawbacks on the additional duty in HTS chapter 99; jetfuel can st ill be used for drawbacks on HTS chapter 22duties.
Consistent fuel ethanol exports since 2009 havegenerated substitution drawbacks that mit igated importduties.
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How U.S. duty drawback regulations linked ethanol to jet fuel
Supplies, including jet fuel , used by U.S. carriers for overseas flights = deemed expor ts
19 U.S.C. 1309
Petroleum derivative products sharing 8-digit HTS subheading are commerciallyinterchangeable
19 U.S.C. 1313(p)
Jet fuel = HTS 2710.12.1520
Gasoline /ethanol blends (>70% gasoline by weight) = HTS 2710.12.1550
Abstracts (proprietary rul ings) held that fuel ethanol impor ts that are blended w ith gasoline
are eligible for substitu tion manufacturing drawbacks, as they are considered to be an inputand a substitute for domestic ethanol that is used for the same purpose
19 U.S.C. 1313(b)
Result
Thus, imports of fuel ethanol can claim duty drawbacks against sales of jet fuel used byU.S. carriers for overseas flights, even though jet fuel contains no ethanol
Only valid for HTS chapter 22 duties
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0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
1,0
00gallons
Fuel Other
Source: Estimated by the USITC based on off icial stati stics of the U.S. Department of Commerce.
U.S. ethanol imports, dominated by fuel use, responded to the RFS
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0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
1,0
00gallons
CBI Brazil Canada All other
Source: Estimated by the USITC based on official stati stic s of the U.S. Department of Commerce.
U.S. fuel ethanol imports are dominated by Brazil (including CBI pathway)
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0
50,000
100,000
150,000
200,000
250,000
300,000
January-July 2013 January-July 2014
1,0
00gall
ons
Brazil Guatemala Netherlands Spain Paraguay Nicaragua
France Costa Rica El Salvador Jamaica Sweden United Kingdom
Source: Calculated based on data from GTIS; LMC International.
U.S. fuel ethanol imports are substantially lower YTD 2014--Brazil, CBI
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0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
2009 2010 2011 2012 2013 Jan-July 2014
1,0
00gallons
Miami, FL Tampa, FL San Francisco, CA Los Angeles, CA Providence, RI New York, NY All other
Source: USITC Dataweb.
U.S. fuel ethanol imports enter mainly through ports in Florida and California
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0
100,000
200,000
300,000
400,000
500,000
600,000
700,000
800,000
900,000
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
1,0
00gallon
s
U.S. CBI dehydration quota never fil led
Filled Unfilled
Source: Estimated by the USITC based on offi cial stati stics of the U.S. Department of Commerce; CBP.
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0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
1,0
00gallons
Trinidad & Tobago Jamaica El Salvador Costa Rica USVI
Source: Estimated by the USITC based on off icial statist ics of the U.S. Department of Commerce; CBP.
CBI dehydration quota stimulated investment to expand capacity
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Export Promotion
Relatively new initiative
Ethanol now eligible for funding under the USDA Market AccessProgram
RFA, ABFA trade mission to Brazil in Sept-Oct 2013 sponsored bythe Brazil-U.S. Business Council
RFA, Growth Energy, U.S. Grains Council and USDA trade missionto China in May 2014; Japan and Korea in September 2014
Future missions planned to Latin American and Southeast Asia
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Major Foreign Policy Issues Affecting Exports
EU RED and FQD: Changing circumstances
EU tariffs: E70 customs rul ing and AD duty
Canada: RFS; Structural market
Brazil gasoline pol icy: Prices, taxes, and blend rate
Brazil transportation costs: ICMS; ship internally by truck
Emerging markets establishing ethanol programs
Market access in potential markets: India; China
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0
200
400
600
800
1,000
1,200
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Milliongallon
s
Canada EU-27 Brazil All other
Source: Compiled from off icial statist ics of the U.S. Department of Commerce.
U.S. exports of nonbeverage ethanol increased dramatically in 2011 as Canada
implements RFS and arbitrage opens in the EU and Brazil
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0
50
100
150
200
250
300
2005 2006 2007 2008 2009 2010 2011 2012 2013
Milliongallons
Netherlands United Kingdom Finland All other
Source: Compiled from off icial statist ics of the U.S. Department of Commerce.
Note: Schedu le B sub headings 2207.1060 and 2207.20.
U.S. exports of nonbeverage ethanol to the EU expanded in 2010-12 but
returned to nominal levels in 2013 largely in response to EU pol icy changes
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0
50
100
150
200
250
300
2005 2006 2007 2008 2009 2010 2011 2012 2013
Milliongallons
US exports EU-27 imports Difference
Source: EU: GTIS, Global Trade Atlas; U.S.: Compiled from off icial statist ics of the U.S. Department of Commerce.
Note: Includes HS heading 2207. Most EU imports of fuel ethanol from the United States likely were classif ied in HS heading 3824.
A major data discrepancy regarding U.S.EU ethanol trade resulted from customs
classification and reporting differences and suggests need for harmonized standards
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U.S.-EU ethanol trade classification issue
HS heading 2207 provides for ethyl alcohol, and other spi rits, denatured, of any strength.
HS subheading 2710.11 specifically provides for fuel mixtures containing at least 70 percent petroleumoils, by weight.
HS subheading 3824.90 could provide for ethanol fuel mixtures between E30 and E93?
HSC (WCO) meetingno consensus. Some informal consensus that less than 93% ethanol is the dividingline between chapter 22 and chapter 38.
ASTM specif ies maximum of 2.5% denaturant, min imum of about 92% ethanol for denatured fuel ethanolstandard (D4806).
IRS VEETC denaturant level limi ted to about 2% (up to 2.5% for rounding). (VEETC expired)
IRS proposed regulation requires additional 0.1% gasoline to qualify for VEETC. (VEETC expired)
EPA allows 2% (2.44% for rounding) denaturant to count toward RFS mandate.
EU Binding Tariff Informations (BTIs)Chapter 38 classification for mixtures as low as E93. UK,Netherlands, Sweden, Finland.
EU specificationsdiffer by member state, end use.
EU customs ruling that E70 is denatured ethanol classified in HS chapter 22.
Substantial data discrepancy between U.S. exports and EU imports.
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When does denatured fuel ethanol change tariff classif ication?
Denatured
Ethanol
HS subheading 2207.20
HS heading text specifies of any strength --ambiguous
No explanatory notes at WCO level
EU duty: 0.102 euros/li ter (about 13% ad valorem)
Chemical
Mixtures
HS subheading 3824.90 Basket category, contains numerous products
EU duty: 6.5 percent ad valorem
EU E70 customs ruling effectively eliminates this category
Gasoline
Mixtures
HS subheading 2710.12
Mixtures containing at least 70% petroleum products, byweight
Not a trade issue
[denatured fuel ethanol usually 2-5% denaturant in US; WCO recommended 7%
denaturant as dividing line; no in ternational consensus]
?
70%
petrol
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0
10
20
30
40
50
60
70
80
90
100
Jan-12
Feb-12
Mar-12
Apr-12
May-12
Jun-12
Jul-12
Aug-12
Sep-12
Oct-12
Nov-12
Dec-12
Jan-13
Feb-13
Mar-13
Apr-13
May-13
Jun-13
Jul-13
Aug-13
Sept-13
Oct-13
Nov-13
Dec-13
Jan-14
Feb-14
Mar-14
Apr-14
May-14
Jun-14
Jul-14
Milliongallons
Canada Brazil EU28 Mexico Peru All other
Source: Compiled from offi cial statist ics of the U.S. Department of Commerce. January-March 2012 estimated by USITC.
New statistical category for U.S. fuel ethanol expor ts in 2012 clarified market data
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0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
400,000
450,000
500,000
January-July 2013 January-July 2014
1,0
00gallons
Canada Brazil United Arab Em All others
Source: Calculated based on data from GTIS; LMC International.
U.S. fuel ethanol exports to established markets are substantially higher in 2014
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0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
80,000
90,000
100,000
January-July 2013 January-July 2014
1,0
00gallons
Philippines Mexico Korea Peru India Singapore Colombia Tunisia Panama
Source: Calculated based on data from GTIS; LMC International.
U.S. fuel exports to newer markets have also increased substantially in 2014
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0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
2012 2013 Jan-July 2014
1,0
00gallons
Houston-Galveston, TX Detroit, MI Pembina, ND Duluth, MN New York, NY All other
Source: USITC Dataweb.
U.S. fuel ethanol is exported mainly through ports in Texas, upper Midwest, New York
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Major Domestic Market Issues
Surplus corn ethanol capacity
Blend wall
Higher-level blend infrastructure
Cellulosic shortfall
California amending LCFS
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0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014
Milliongallons
Final undifferentiated renewable fuel RVO Capacity Capacity under construction/expansion
Source: Renewable Fuels Associ ation.Note: Data are as of January 1 of the given year.
U.S. ethanol capacity nears f inal RFS obligation for undifferentiated renewable
fuel (corn ethanol)
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5
10
15
20
25
30
35
40
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022
Billiongallon
s
RFS (EISA) E10 E10 (adjusted) E15 E25
Including RIN carryover
And adding additional b iomass-based diesel gal lons and RIN credits
Source: Calculated based on the RFS and EIA gasoline consu mption forecasts.
Note: Data for comparative purpo ses regarding dif ferent blends. Actual date of blend wall cons traint depends on several factors.
Although the blend wall is approaching, timing is difficult to assess
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Limited availability of higher-level blends
E15: 78 stations (80% of fleet can use)
Blender pumps: 308 pumps
E85: 3,387 stations (7% of fleet can use)
Total number of gas stations: 142,000
Source: Renewable Fuels Association; E85Prices.com.
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Cellulosic ethanol commercial capacity coming
online but stil l well short of original RFS
Dupont: 30 mg, IA
Poet: 25 my, IA
Abengoa: 25 my, KS Quad County: 2 my, IA
Scheduled 2014 cellulosic RVO: 1.75 bg
EPA 2014 projected range: 8-30 mg
EPA proposed 2014 cellulosic RVO: 17 mg
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RFS cellulosic RVO shortfalls
EPA maintained the total advanced RVO
This effectively doubled the undifferentiated advancedRVO
Availability of alternatives inform EPAs decision Biomass-based diesel extra half RIN credits
Additional biomass-based diesel gallons
Sugarcane ethanol imports
Other domestic advanced Biogas Naptha
Renewable diesel
Ethanol (sorghum)
RIN carryover
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Source: Energy Poli cy Act; EISA; 75 Fed. Reg. 76790 (December 9, 2010); various EPA Regulator y Announ cements.
Note: The cellulosic vol ume was lowered substantially 2010-2013 ; the biomass-based diesel standard was combin ed for 2009 and 2010.
YearUndifferentiated
renewable fuel
Advanced biofuel Total renewable fuel
Biomass-based
dieselCellulosic Undifferentiated
Total, advanced
biofuel
Billions of gallons Share of
gasoline/diesel
(percent)
2006 4 0 0 0 0 4 2.78
2007 4.7 0 0 0 0 4.7 4.02
2008 9 0 0 0 0 9 7.76
2009 10.5 0.5 0 0.1 0.6 11.1 10.21
2010 12 0.65 0.0065 (0.1) 0.2935 (0.2) 0.95 12.95 8.25
2011 12.6 0.8 0.0066 (0.25) 0.5434 (0.3) 1.35 13.95 8.01
2012 13.2 1 0.00865 (0.5 ) 0.99135 (0.5) 2 15.2 9.23
2013 13.8 1.28 (1) 0.014 (1) 1.456 (0.75) 2.75 16.55 9.63
2014 14.4 1 1.75 1 3.75 18.15 -
2015 15 1 3 1.5 5.5 20.5 -
2016 15 1 4.25 2 7.25 22.25 -
2017 15 1 5.5 2.5 9 24 -
2018 15 1 7 3 11 26 -
2019 15 1 8.5 3.5 13 28 -
2020 15 1 10.5 3.5 15 30 -
2021 15 1 13.5 3.5 18 33 -
2022 15 1 16 4 21 36 -
GHG reduction Percent
20 50 60 50 - - -
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Cellulosic shortfall combined w ith maintenance of advanced requirement effectively doubled
the undif ferentiated advanced RVO; demand for imports of sugarcane ethanol depends on the
availability of alternatives
650800
1,0001,280
94
243
491
706
200
300
500
750
0
500
1,000
1,500
2,000
2,500
3,000
2010 2011 2012 2013
AdvancedRFS(millio
ngallons)
Biomass-based d iesel Cellulosic Cellulosic s hortfall Undifferentiated
Source: Calculated based on RFS.
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2013 undifferentiated advanced RVO fulfillment scenarios
(RVO = 1.464 bg; cellu losic shortfall = 994 mg)
640 640800
150245
295666 580
580
0
500
1,000
1,500
2,000
2,500
3,000
EPA NPRM EPA FR MAX
Milliongallons
Biomass-based diesel RINs Extra biomass-based diesel gallons Other advanced 2012 Carryover RINS (D4/D5) Sugarcane ethanol
549
320
2,544
Source: Calculated based on RFS; EPA, 2013 RFS proposal and final rule.
Note: MAX scenario assumes biomass-based diesel production of 1.6 bg and other EPA scenarios in the final rule.
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EPA 2014 RVO proposal
Initial proposal published November 29, 2013 Total RVO of 15.21 bg, down from 18.15 bg in RFS
Undifferentiated renewable RVO (corn) of 13.01 bg, down from 14.4 bg
in RFS
Advanced RVO of 2.20 bg, down from 3.75 bg in RFS
Cellu losic RVO of 17 mg, down from 1.75 bg in RFS Biomass-based diesel RVO of 1.28 bg, unchanged
Undifferentiated advanced RVO of 903 mg, down from 1 bg in RFS
Could resul t in a need for less than 300 mg of imported sugarcane
ethanol (903 mg - 640 BBD RIN credits - ? carryover RINS)
Proposal revised and sent to OMB for interagency review
Can take up to 90 days for review; decision expected sooner
Some RVOs expected to increase from ini tial proposal
Approval expected sometime after late October 2014
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Proposal to significantly relax the LCFS compliance schedule
Year Gasoline and gasol ine blends
Carbon intensity (gCO2e/MJ) % Reduction
Baseline (may change) 95.85 -
2011 95.61 0.25
2012 95.34 0.5
2013 97.96 94.89 1.0
2014 97.47 94.41 1.5
2015 96.48 93.45 2.5
2016 95.49 92.50 3.5
2017 94.00 91.06 5.0
2018 92.52 89.62 6.5
2019 91.03 88.18 8.0
2020+ 89.06 86.27 10.0
Source: California Air Resources Board, draft Final Regulation Order, available at http://www.arb.ca.gov/fuels/lcfs/CleanFinalRegOrder112612.pdf(accessed
September 9, 2014).
http://www.arb.ca.gov/fuels/lcfs/CleanFinalRegOrder112612.pdfhttp://www.arb.ca.gov/fuels/lcfs/CleanFinalRegOrder112612.pdfhttp://www.arb.ca.gov/fuels/lcfs/CleanFinalRegOrder112612.pdf8/10/2019 Newman Ethanol Policy and Trade Biofuels International 14 Ghent_final
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CA LCFS carbon intensity values from applications show wide variation between and
among feedstockscorn ethanol improving carbon profile
Fuel Pathway
Carbon Intensity Values
(gCO2e/MJ)
Direct Emissions
Land Use or Other
Effects Total
Gasol ine CARBOB 99.18 0 99.18
Corn ethanol
(undenatured)
Lowest 43.21 30 73.21
Highest 62.44 30 92.44
Sugarcane ethanol
(undenatured)
Lowest 17.94 46 63.94
Highest 32.94 46 78.94
Note: As of December, 2012. Only inc ludes values from facilities that filed applicatio ns.
Source: California Air Resources Board, available at http://www.arb.ca.gov/fuels/lcfs/lu_tables_11282012.pdf.
http://www.arb.ca.gov/fuels/lcfs/lu_tables_11282012.pdfhttp://www.arb.ca.gov/fuels/lcfs/lu_tables_11282012.pdfhttp://www.arb.ca.gov/fuels/lcfs/lu_tables_11282012.pdf8/10/2019 Newman Ethanol Policy and Trade Biofuels International 14 Ghent_final
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RFS RVOs may be lowered for 2014 and beyond
Increases pressure to export corn ethanol
Reduces need for imported sugarcane/molasses ethanol
California LCFS amendment
Reduces urgency for imported sugarcane/molasses ethanol
Reduces pressure to export corn ethanol
But only about 12% of U.S. market
Expiration of ODC and CBI dehydration quota
Uncertain real effect because of duty drawbacks
Eliminates pressure by trade partners to lower duties
Biodiesel blenders tax credit reinstated retroactively
Reduces need for imported sugarcane/molasses ethanol
Reduces blend wall pressure on ethanol
Summary of major policy implications for U.S. trade
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Opportunities for trade
Growth in existing markets Canada; Brazil United States and EU less certain; n iches?
Development of new markets Proliferation of biofuel policies
Latin America; Asia; Africa India and China market access?
New export promotion initiative
New technology/products Improve carbon profile
Lower costs 2ndand 3rdgeneration
General trend towards lower trade barriers WTO bound duty reductions
Environmental Goods Agreement
Free Trade Agreements
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Thank You!
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