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Vilsack Puts His Money Where His Mouth is on Biofuels

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Vilsack Puts His Money Where His Mouth is on Biofuels

Vilsack headLast week US ethanol production average 41 million gallons daily. That is up from the week before and tied for the highest weekly average on record. The four-week average for ethanol production stood at 973,000 barrels per day for an annualized rate of 14.92 billion gallons, more than 1.5 billion gallons above EPA’s recent proposed RFS volume for 2015. Stocks of ethanol stood at 20.2 million barrels. That is a 0.9% increase from last week. A new USDA program is designed to find a home for this increased ethanol production.

Secretary of Agriculture Tom Vilsack said there are 17 million flex fuel vehicles on the road today capable of using more than a 10% blend of ethanol. The problem is making those higher blends available to consumers. Vilsack stated, “In order for that to happen, independent stations and convenience stores need to install blender pumps. We hope this program will make that happen.” The USDA program will provide a financial incentive for locations that install such a system.

Oil companies own the majority of the fuel stations in the US and refuse to allow them to sell renewable fuel. Vilsack said this program will target independent operators who may be interested in offering higher blends of ethanol to their customers, “These operators know there are flex fuel vehicles out there. They know renewable fuel will be less expensive for their customers. They know this may be a way to get motorists into their stores so they can sell them other products. So, at the end of the day, we think there is a demand for this resource and, if they offer it to consumers, they will buy it.” The USDA has committed $100 million which Vilsack hopes will result in about 10,000 new pumps being installed.

blender pumpIn a one on one interview with Hoosier Ag Today, Vilsack admitted that the big oil lobby and many in Congress have been less than supportive when it comes to helping the renewable fuels sector, “Congress, with pressure from the oil lobby, has tried to stop us from doing this in the past. They have told us we can’t do this and have tried to stop us from doing it, but we wanted to find a way to help this sector.”  He added that renewable fuels have proven to be good for agriculture, good for rural America, and good for the country as a whole.  This is just the latest in a series of Initiatives announced by USDA to increase the demand for ethanol, biodiesel, and next generation ethanol. Vilsack hopes the increased demand for ethanol will help increase the demand for corn and, thus, help corn prices to recover.