American Coalition For Ethanol

DELIVER VALUE TO MEMBERS THROUGH GOVERNMENT RELATIONS, MARKET DEVELOPMENT AND PUBLIC RELATIONS.

GOVERNMENT AFFAIRSYEAR-ROUND E15ACE REMAINED LASER-FOCUSED ON SECURING NATIONWIDE MARKET ACCESS FOR E15 ON A YEAR-ROUND BASIS BY STRONGLY SUPPORTING BIPARTISAN GOVERNORS WHO HAVE PETITIONED EPA TO ALLOW E15 YEAR-ROUND IN THEIR MIDWEST STATES, PRESSING EPA TO TAKE FINAL ACTION FOR THESE STATES BEFORE THE 2024 SUMMER DRIVING SEASON, AND PREPARING TO ONCE AGAIN MAKE THE CASE FOR EMERGENCY WAIVERS IN ADDITION TO PURSUING A LEGISLATIVE SOLUTION. ACE HAS ALSO BEEN MOBILIZING SUPPORT IN CONGRESS TO ENACT LEGISLATION FOR PERMANENT AND NATIONWIDE E15. CAPITALIZING ON CORN ETHANOL'S LOW-CARBON ADVANTAGES IN NEW MARKETS AND THROUGH TAX CREDITSACE IS LEADING A USDA-FUNDED PROJECT TO HELP FARMERS ADOPT PRACTICES SUCH AS CONSERVATION TILLAGE, 4R NUTRIENT MANAGEMENT, AND COVER CROPS TO REDUCE THE CARBON INTENSITY OF THE CORN THEY DELIVER TO YOUR PLANTS. WE ARE COLLABORATING WITH SCIENTISTS TO PROPERLY MONITOR AND MEASURE THE GREENHOUSE GAS (GHG) BENEFITS RESULTING FROM THE PRACTICES ADOPTED BY FARMERS. THE DATA ACE COLLECTS THROUGH THIS PROJECT WILL INCREASE THE CONFIDENCE IN CURRENT MODELS USED TO QUANTIFY SOIL CARBON SEQUESTRATION AND NITROUS OXIDE EMISSIONS, AND THE IMPACTS OF CROP YIELD, TILLAGE INTENSITY AND NITROGEN FERTILIZER MANAGEMENT ON BIOFUEL GHG EMISSIONS. THE DATA WE COLLECT WILL ALSO ENABLE US TO BUILD A NON-PROPRIETARY TOOL FOR FARMERS AND ETHANOL PRODUCERS TO USE TO VERIFY THEIR CARBON BENEFITS AND MONETIZE THEM THROUGH THE MARKETPLACE.THIS HISTORIC REGIONAL CONSERVATION PARTNERSHIP PROGRAM (RCPP) BEGAN CONDUCTING ONE-ON-ONE MEETINGS WITH FARMERS AND OBTAINED SIGNED CONTRACTS TO COMPENSATE THEM FOR IMPLEMENTING CLIMATE-SMART PRACTICES, WHICH WILL BE MEASURED TO VALIDATE THE GHG BENEFITS OF THOSE PRACTICES SO ETHANOL PLANTS CAN SECURE LOW-CARBON FUEL PATHWAYS.ACE WILL TRY TO EXPAND THIS EFFORT TO BENEFIT NEARLY A DOZEN ETHANOL PLANT MEMBERS AND FARMERS IN 162 COUNTIES WE SELECTED AROUND THE COUNTRY TO CAPTURE THE SOIL, PRECIPITATION, AND TEMPERATURE VARIABILITY NEEDED TO REFINE THE GHG DATA ASSUMPTIONS UNDERLYING THESE CLIMATE MODELS TO ALLOW THEM TO BE USED IN CLEAN FUEL MARKETS OR THROUGH NEW TAX CREDITS.ACE IS ALSO HELPING MAXIMIZE OUR MEMBERS' ABILITY TO TAKE ADVANTAGE OF NEW TAX CREDITS ADOPTED BY CONGRESS LATE IN 2022, PARTICULARLY THE NEW 45Z CLEAN FUEL PRODUCTION TAX CREDIT, NEW 40B SUSTAINABLE AVIATION FUEL (SAF) TAX CREDIT, AND THE MODIFIED 45Q TAX CREDIT FOR CARBON CAPTURE, STORAGE AND UTILIZATION PROJECTS. WE ARE ENGAGING WITH THE TREASURY DEPARTMENT TO ENSURE THE GREET MODEL IS USED TO DEPLOY THESE TAX CREDITS AND CONDUCTING WEBINARS TO HELP OUR MEMBERS MAKE THE MOST OF THE NEW TAX INCENTIVES.WE HAVE CREATED CALCULATORS AT WWW.ETHANOL.ORG TO HELP OUR MEMBERS UNDERSTAND HOW CHANGES IN FARMING OR ETHANOL OPERATIONS CAN IMPACT CARBON FOOTPRINTS, AND DO THE MATH ON WHAT TECHNOLOGY INVESTMENTS AND CLIMATE-SMART FARMING PRACTICES ARE WORTH, WHETHER THROUGH EXISTING CLEAN FUEL MARKETS LIKE THOSE ON THE WEST COAST OR CANADA, OR VIA NEW INCENTIVES, LIKE THE 45Z CLEAN FUEL PRODUCTION TAX CREDIT ENACTED BY CONGRESS. AS PART OF OUR REVITALIZED WEBSITE, ACE IS LAUNCHING A NEW CARBON CALCULATOR IN 2024 TO HELP MEMBERS ESTIMATE THE POTENTIAL VALUE OF THE CREDIT TO THEIR COMPANIES. NEW POLICY INITIATIVES TO INCREASE DEMANDACE CONTINUES TO PROACTIVELY ADVOCATE FOR NEW POLICIES AT THE STATE AND FEDERAL LEVELS TO ENSURE A GROWING MARKET FOR LOW-CARBON ETHANOL EVEN AS OVERALL PETROLEUM USE DECLINES.THANKS TO THE LEADERSHIP OF ACE, MANY STATES ARE CONSIDERING NEW CLEAN FUEL OR TRANSPORTATION STANDARDS TO INCREASE DEMAND FOR LOW-CARBON FUELS SUCH AS ETHANOL. LEGISLATION IS ADVANCING IN STATES SUCH AS ILLINOIS, NEW MEXICO, NEW YORK, MASSACHUSETTS, MICHIGAN, MINNESOTA, AND VERMONT. ACE IS INVOLVED IN SEVERAL STATES TO ENSURE CORN ETHANOL IS TREATED FAIRLY AND THERE ARE CARBON CREDITS FOR CLIMATE-SMART AGRICULTURE PRACTICES AND OPPORTUNITIES TO INCREASE DEMAND FOR E15 AND HIGHER BLENDS.AT THE FEDERAL LEVEL, ACE IS SUPPORTING MANY NEW BIPARTISAN BILLS TO INCREASE THE USE OF ETHANOL; INCLUDING THE FLEX FUEL FAIRNESS ACT TO INCREASE THE AVAILABILITY OF FLEXIBLE FUEL VEHICLES (FFVS) AND THE NEXT GENERATION FUELS ACT TO OVERCOME THE BARRIERS STANDING IN THE WAY OF HIGHER ETHANOL BLENDS SUCH AS E25/30 AND E85. THIS LEGISLATION WOULD IMPROVE VEHICLE EFFICIENCY AND REDUCE EMISSIONS THROUGH NEW HIGH-OCTANE FUEL STANDARDS, REQUIRE FUTURE VEHICLES TO BE COMPATIBLE WITH HIGH-OCTANE ETHANOL BLENDS, RESTORE INCENTIVES FOR AUTOMAKERS TO PRODUCE FFVS, LIMIT HARMFUL AROMATICS IN GASOLINE, ENSURE ALL BLENDS OF ETHANOL RECEIVE THE SAME RVP TREATMENT AS E10, AND MAKE SURE FUEL STATIONS ARE COMPATIBLE WITH HIGH-OCTANE ETHANOL BLENDS.ACE ALSO SUBMITTED TESTIMONY UNDERSCORING THE ROLE ETHANOL AND CLIMATE-SMART AGRICULTURE PRACTICES CAN PLAY IN ENSURING FEDERAL CLEAN FUEL POLICY MEETS TRANSPORTATION DECARBONIZATION GOALS AS THE SENATE ENVIRONMENT AND PUBLIC WORKS (EPW) COMMITTEE HELD A HEARING ON "THE FUTURE OF LOW CARBON TRANSPORTATION FUELS AND CONSIDERATIONS FOR A NATIONAL CLEAN FUELS PROGRAM." ACE IS PART OF THE DRIVECLEAN INITIATIVE, A GROUP OF OVER 20 ORGANIZATIONS ADVOCATING FOR A MARKET-BASED, TECHNOLOGY-NEUTRAL CLEAN FUEL STANDARD IN CONGRESS.ACE HOSTED TWO EVENTS DURING THE YEAR TO PROMOTE THESE POLICY INITIATIVES. IN THE SPRING, 60 ADVOCATES GATHERED IN WASHINGTON, DC FOR ACE'S 12TH ANNUAL DC FLY-IN. IN THE SUMMER, ACE HOSTED ITS 36TH ANNUAL ACE CONFERENCE IN MINNEAPOLIS, MN WITH OVER 200 ETHANOL INDUSTRY MEMBERS, INCLUDING SESSIONS ON SEVERAL CARBON TOPICS.

MARKET DEVELOPMENTTHE AMERICAN COALITION FOR ETHANOL'S MARKET DEVELOPMENT EFFORTS SET OUT ON AN AMBITIOUS JOURNEY IN 2023, LITERALLY AND FIGURATIVELY, TOWARD THE EXPANSION OF MARKETS FOR ETHANOL IN THE U.S. AND AROUND THE WORLD. FOCUSING ON ETHANOL'S LOW-COST ABILITY TO MEET ENVIRONMENTAL OBJECTIVES, ITS SEAMLESS COMPATIBILITY WITH EXISTING INFRASTRUCTURE, AND ITS LONG RECORD OF REDUCING FUEL PRICES; ACE CONTINUES ITS LEADERSHIP IN TAKING THOSE BENEFITS FROM FIELDS TO FUEL TANKS BY HELPING PROSPECTIVE ETHANOL DISTRIBUTORS AND RETAILERS UNDERSTAND ETHANOL PROVIDES ALL THOSE BENEFITS ALONG WITH INCREDIBLE PROFIT OPPORTUNITIES.INTERNATIONAL ENDEAVORSTHE YEAR STARTED WITH A JANUARY TRIP TO NEW DELHI, INDIA, WHERE ACE CHIEF MARKETING OFFICER RON LAMBERTY JOINED THE U.S. GRAINS COUNCIL (USGC) AT THE INDIA AUTO EXPO TO PROMOTE ETHANOL AND INDIA'S PLAN TO MOVE TO 20 PERCENT ETHANOL BY 2025. LAMBERTY WAS ALSO INVITED TO SPEAK ABOUT THE U.S. EXPERIENCE WITH EXPANDING ETHANOL USE, WHERE HE DISPELLED MYTHS ABOUT FUEL COSTS AND VEHICLE AND INFRASTRUCTURE COMPATIBILITY, WHICH HAVE APPEARED MORE FREQUENTLY AS MISINFORMATION CAMPAIGNS, LIKE THOSE USED FOR DECADES AGAINST U.S. ETHANOL. LAMBERTY PRAISED INDIA'S LEADERS FOR FOLLOWING SCIENCE SHOWING ETHANOL AS THE BEST, FASTEST, AND MOST COST-EFFECTIVE WAY TO IMPROVE THE NATION'S AIR QUALITY, AND APPLAUDED THEM FOR MOVING THE COUNTRY FROM ZERO ETHANOL TO 10 PERCENT IN ONLY A FEW YEARS.CLOSER TO HOME, CANADA IS POISED TO INCREASE ETHANOL USE AS PART OF THEIR STRATEGY TO ALIGN WITH GLOBAL EFFORTS TO COMBAT CLIMATE CHANGE; AND PRIOR TO USGC'S ANNUAL BOARD OF DELEGATES MEETING IN CALGARY IN JULY, LAMBERTY WAS PART OF A GROUP USGC ORGANIZED TO MEET WITH STAKEHOLDERS INCLUDING A REFINER, C-STORE CHAINS, AND PROVINCIAL AND LOCAL ENVIRONMENTAL AND FLEET OFFICIALS. MANUFACTURED CONCERNS ABOUT COST AND COMPATIBILITY WERE AGAIN TOPICS OF DISCUSSION, THIS TIME FOCUSING ON E15 AND EXPLANATIONS SEEMED TO BE READILY ACCEPTED AS CANADA IS FAMILIAR AND COMFORTABLE WITH ETHANOL, HAVING SOLD E5 AND E10 FOR DECADES. LAMBERTY PREDICTS CANADA WILL SEE NATIONWIDE E15 USE BEFORE THE U.S. DUE TO REGULATIONS APPLIED EVENLY TO ALL CLEAN FUEL OPTIONS.IN MID-OCTOBER, LAMBERTY DROVE 1,300 MILES TO RESTON, VIRGINIA, IN HIS HYBRID ELECTRIC FLEX FUEL VEHICLE, "HEFF," TO SPEAK AT USGC'S GLOBAL ETHANOL SUMMIT (GES) ABOUT RETAILER ETHANOL BLENDING ECONOMICS AND MARGIN OPPORTUNITIES. PARTICIPANTS FROM MORE THAN 40 COUNTRIES ATTENDED THE GES; AND IN ADDITION TO HIS PRESENTATION, LAMBERTY MET WITH GROUPS FROM SEVERAL NATIONS CONSIDERING ADDING ETHANOL. THE COUNCIL ASKED LAMBERTY TO BRING HEFF TO DISPLAY AT THE CONFERENCE, AS SEVERAL COUNTRIES CONSIDER IMPLEMENTING HYBRIDS THAT CAN RUN ON HIGHER ETHANOL BLENDS LIKE E85. DELEGATES FROM JAPAN, CHINA AND LATIN AMERICA SHOWED PARTICULAR INTEREST IN HEFF.FOLLOWING THE RETURN TRIP FROM VIRGINIA, LAMBERTY LED A TOUR OF THE SOUTH DAKOTA ETHANOL SUPPLY CHAIN FOR REPRESENTATIVES OF THREE LATIN AMERICAN COUNTRIES WITH PLANS TO REQUIRE ETHANOL-BLENDED GASOLINE IN 2024 OR 2025. ACE, USGC, THE SOUTH DAKOTA CORN UTILIZATION COUNCIL AND POET HOSTED DELEGATES FROM COSTA RICA, GUATEMALA, AND PANAMA, AND WHICH, LIKE NATIONS MENTIONED PREVIOUSLY, HAVE EXPERIENCED INCREASED "NOISE" ABOUT POTENTIAL ETHANOL DRAWBACKS. DOMESTIC EFFORTSETHANOL MISINFORMATION AND FEARMONGERING ARE BEING EXPORTED AROUND THE GLOBE, BUT PLENTY OF SUPPLY REMAINS IN THE U.S. EVEN WITH VIRTUALLY EVERY FUEL RETAILER NOW HAVING SEVERAL YEARS' EXPERIENCE HANDLING AND MARKETING ETHANOL WITHOUT INCIDENT, STATION OWNERS CONTINUE TO QUESTION E15 EQUIPMENT COMPATIBILITY AND COST. ACE'S FLEX CHECK COMPATIBILITY TOOL ON FLEXFUELFORWARD.COM CONTINUES TO REDUCE MARKETER FEARS ABOUT SELLING E15 IN EXISTING EQUIPMENT, AND OUR COLLABORATION WITH USDA AND PROMOTION OF THEIR HIGHER BLENDS INFRASTRUCTURE INCENTIVE PROGRAM (HBIIP) IS HELPING RETAILERS FIND FUNDING TO UPGRADE THEIR STATIONS AND SELL HIGHER ETHANOL BLENDS.ACE ROUNDED OUT ITS 2023 PETROLEUM MARKETER TRADE SHOW SEASON AT THE NATIONAL ASSOCIATION OF CONVENIENCE STORES (NACS) SHOW IN ATLANTA, GEORGIA, THE WORLD'S LARGEST ANNUAL GATHERING OF CONVENIENCE AND FUEL MARKETING PROFESSIONALS. ACE ALSO TOOK PART IN THE WESTERN PETROLEUM MARKETERS ASSOCIATION (WPMA) TRADESHOW IN LAS VEGAS, MIDWEST PETROLEUM AND CONVENIENCE TRADESHOW (M-PACT) IN INDIANAPOLIS, PACIFIC FUELS AND CONVENIENCE SUMMIT (PFCS) IN SAN DIEGO, AND OTHERS IN 2023. AT THESE SHOWS, ACE PROVIDES ANSWERS TO PROSPECTIVE HIGHER-BLEND ETHANOL MARKETERS' QUESTIONS ABOUT INFRASTRUCTURE COMPATIBILITY, BEST PRACTICES FOR MARKETING E15 AND E85, AND HBIIP AND ITS APPLICATION PROCESS.KNOWING FUEL RETAILERS TRUST OTHER RETAILERS WHEN CONSIDERING NEW PRODUCTS, ACE'S MARKET DEVELOPMENT EFFORTS HIGHLIGHT SUCCESSFUL ETHANOL RETAILERS AND THEIR STORIES, AND DIRECT PROSPECTIVE HIGHER-BLEND MARKETERS TO THAT INFORMATION ON OUR FLEXFUELFORWARD.COM MARKETER-TO-MARKETER WEBSITE.AFTER THE LATEST SLATE OF FUNDING FOR HBIIP UNDER THE INFLATION REDUCTION ACT WAS ANNOUNCED AS $500 MILLION, WITH $50 MILLION FILLING EXTRA GRANT REQUESTS FROM THE MOST RECENT HBIIP ROUND, ACE UPDATED FLEXFUELFORWARD.COM TO EASILY DIRECT PROSPECTIVE E15 AND FLEX FUELS RETAILERS TO INFORMATION ABOUT APPLYING FOR AND OBTAINING PART OF THE REMAINING $450 MILLION, BROKEN INTO FIVE TRANCHES OF $90 MILLION PER CALENDAR QUARTER BEGINNING JULY 1, 2023, AND ENDING SEPTEMBER 30, 2024.ACE HELPS RETAILERS APPLY FOR HBIIP GRANTS AND PROVIDES FEEDBACK TO USDA ON PROGRAM CHALLENGES EXPERIENCED BY MARKETERS. ACE HAS CONSISTENTLY ADVOCATED FOR CHANGES MAKING THE PROGRAM MORE ACCESSIBLE AND ATTRACTIVE TO SINGLE STORE AND SMALL CHAIN RETAILERS, WHO OWN AND OPERATE 60 PERCENT OF C-STORE LOCATIONS, AND ARE KEY TO WIDESPREAD AVAILABILITY OF BLENDS LIKE E15 AND FLEX FUELS. ACE ALSO BEGAN A NEW ROUND OF ADVERTISEMENTS IN C-STORE MAGAZINES, ONLINE PUBLICATIONS, AND FUEL INDUSTRY WEBSITES TO DIRECT PROSPECTIVE ETHANOL RETAILERS TO FLEXFUELFORWARD.COM FOR UPDATED HBIIP INFORMATION. ACE ADJUSTED ITS AD CAMPAIGN TO FOCUS ON THE BEGINNING AND END OF HBIIP APPLICATION PERIODS, LETTING RETAILERS KNOW IF THEY MISSED ONE DEADLINE, ANOTHER APPLICATION WINDOW WILL OPEN OR HAS JUST OPENED. THESE UPDATES AND THE 75 PERCENT REIMBURSEMENT INCENTIVE HAVE RESULTED IN DOUBLING OF WEBSITE TRAFFIC, EVEN AFTER REQUESTS FOR HBIIP INFORMATION AND APPLICATION ASSISTANCE TRIPLED IN 2022. IN THE LATEST ROUND, ACE ASSISTED MARKETERS FROM CALIFORNIA TO CONNECTICUT, AND FROM MICHIGAN TO GEORGIA.E85 PROMOTING THE LOWEST CARBON LOW-CARBON FUELALTHOUGH AUTOMAKERS AND FEDERAL RULES MAKE IT INCREASINGLY DIFFICULT TO GET A FLEX-FUEL VEHICLE (FFV), WITH ETHANOL SELLING AT HUGE DISCOUNTS TO GASOLINE, 20 MILLION FFVS ON THE ROAD AND HBIIP FUNDING AVAILABLE, E85 IS OFFERED IN ABOUT TWICE AS MANY LOCATIONS AS E15 AND THE NUMBER OF FLEX-FUEL SITES CONTINUES TO GROW ALONG WITH E15. E85 MARKETERS ARE SEEING DRAMATICALLY INCREASED VOLUMES AND PROFITS AS FFV OWNERS SEE LOW E85 PRICES AND DISCOVER THEIR CARS AND TRUCKS CAN USE THE LOWEST PRICED FUEL ON THE MARKET.TAKING ADVANTAGE OF THAT E85 MOMENTUM AND AS AN EXTENSION OF ACE'S PUBLIC POLICY LEADERSHIP ON CARBON REDUCTION, AND ONGOING MARKET DEVELOPMENT EFFORTS PROMOTING HIGHER ETHANOL BLENDS TO FUEL MARKETERS AS LOW-CARBON "FUTURE FUELS" ALREADY AVAILABLE IN THE MARKETPLACE, OUR HYBRID ELECTRIC FLEX FUEL (HEFF) DEMONSTRATION PROJECT GOES A STEP FURTHER, SHOWING A CONVENTIONAL HYBRID WITH E85 CAPABILITY CAN BEAT A PLUG-IN EV TO NET-ZERO CI. THE INTENT OF ACE'S HEFF PROJECT IS TO SHOW A HYBRID VEHICLE ESTIMATED TO CUT CO2 EMISSIONS IN HALF, COMPARED TO STANDARD GASOLINE VEHICLES, COULD CUT EMISSIONS FURTHER WHEN RUNNING ON E85.AT THE END OF TWO YEARS AND ALMOST 30,000 MILES ON THE ROAD, HEFF'S REAL-WORLD CO2 EMISSIONS RUNNING ON AN AVERAGE OF 71 PERCENT ETHANOL ARE 25 PERCENT LOWER THAN THE SAME VEHICLE USING E10. AND HEFF'S 203 GRAMS PER MILE (G/M) CO2 EMISSIONS WOULD DROP TO 145 G/M IF THE E71 WERE MADE WITH CORN FIBER ETHANOL (CFE), AND FURTHER TO 72 G/M IF THE GASOLINE PORTION OF CFE WAS RENEWABLE NAPHTHA. THOSE NUMBERS WOULD DROP TO 181, 113 AND 71 G/M WITH E85 MADE FROM THE SAME COMPONENTS, ALL OF WHICH ARE AVAILABLE TODAY.