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Growth Energy published its 2024 federal policy priorities yesterday. Organized into three categories, the agenda offers a roadmap toward a more vibrant future characterized by lower fuel costs, lower greenhouse gas (GHG) emissions, greater energy independence, and stronger rural communities. 

"These are the policy decisions that will shape the next era of growth in plant-based energy and climate solutions," said Growth Energy CEO Emily Skor. "We hope these priorities serve as roadmap for elected officials seeking to support biomanufacturing facilities at the heart of America’s bioeconomy.” 

“Growth Energy, its members, and its champions on Capitol Hill know that the full potential of America’s bioethanol sector has yet to be fully realized,” she added. “With the right policies in place, our industry will continue to meet America’s energy needs, economic demands, and carbon reduction goals — all at the same time.” 

Growth Energy's 2024 federal policy priorities can be found here, or by visiting growthenergy.org/policy. 

For more information, please contact Vice President of Government Affairs John Fuher.

WEEKLY EIA DATA

Last week, domestic ethanol demand was 13.0 BGY, up 5.1% compared to a week ago. The EIA-reported gas demand was up 4.7% from last week, at 127.6 BGY. Most of the weekly change was likely due to this being Christmas/New Year’s period of holiday travel and holiday period retail outlet restocking patterns. The 4-week average ethanol and gas demand are 13.4 and 131.1 BGY (+3.3% YoY) and are likely more indicative of current demand levels than the weekly snapshot.

The difference between the weekly percent change in gas demand and ethanol demand relates to the increase in ethanol penetration estimated for 2024 versus 2023. During the week ending January 5, 2024, with three days in 2023 and 4 days in 2024, the weighted average blend percentage is 10.22% based on our forecast that the ethanol penetration of the gasoline pool in 2024 will average 10.25%, up from our estimate of 10.18% in 2023.

Ethanol production was 16.3 BGY last week, up 1.2% versus the week before, and 3.1% more than the 4-week average in 2019. Midwest production was up 1.1% (+3.2 MG) versus a week ago, and average production in the other regions was up 3.7% (+0.6 MG). Capacity utilization of plants online was 92.3% overall, 93.4% in the Midwest, and 76.0% on average, elsewhere, excluding 1,197 MGY of capacity shutdown at 25 ethanol plants for other than maintenance. On an installed capacity basis, utilization was 86.4% overall, 90.9% in the Midwest and 45.6% in the other regions.

Exports were an estimated 28.4 MG last week based on 120 MG of exports forecast for December and 130 MG in January. The EIA reported no ethanol imports last week.

Overall inventory was up 29.7 MG last week. EIA-counted stocks increased 33.3 MG, and regional changes were: East (+24 MG), Gulf (+11 MG) and West (+1 MG) Coasts and the Midwest (-3 MG). In-transit inventory decreased 3.6 MG.

Based on the total inventory of 1,826 MG on January 5th and the 4-week avg. domestic demand, there were 48.8 days of supply, up 1.5 days versus a week ago. Including the 4-week avg. of net exports, there were 44.0 days of supply, up 1.2 days versus a week ago.

For more information, please contact Jake Comer.

WORKING FOR YOU

UPCOMING EVENTS

2024 Growth Energy Executive Leadership Conference

Marco Island, Fla.

January 31- February 4, 2024

IN GOVERNMENT AFFAIRS

U.S. House Ways and Means Committee Chairman Jason Smith (R-Mo.) and Senate Finance Committee Chairman Ron Wyden (D-Ore.) announced a bipartisan, bicameral $78 million tax framework, introduced as The Tax Relief for American Families and Workers Act of 2024. Included in the legislation is expensing for domestic research and development costs retroactive to 2022, along with restoration of an earlier interest deduction, an expansion of small business expensing, and an extension of bonus depreciation.

Domestic Research: Specifically on the research and experimental expenditures, this bill delays the date when taxpayers must begin deducting their domestic research or experimental costs over a five-year period until taxable years beginning after December 31, 2025. Therefore, businesses of all sizes may immediately deduct currently domestic research or experimental costs that are paid or incurred in tax years beginning after December 31, 2021, and before January 1, 2026.

Small Business Expensing Cap: This bill would increase the amount of investment that a small business can expense for qualifying equipment and/or software to $1.29 million. A phase-out would begin at $3.22 million assets placed in service, adjusted for years beginning after 2024.

A section-by-section breakdown of the bill is available here. Growth Energy’s Government Affairs team will continue to track the status of the bill and weigh in on the provisions important to Growth Energy members.

Today marks the second day of Fuels America's 2024 Fly-In. Similar to the Growth Energy Biofuels Summit (aka GEBS, hosted annually every fall), the event gives the bio-based and renewable fuels industries a chance to raise their concerns with lawmakers in Washington, thank the elected officials that have demonstrated their commitment to biofuels, and urge congresspeople on both sides of the aisle to embrace renewable liquid fuels as a solution to the nation's economic and environmental challenges. In addition to meeting with lawmakers today, Fuels America will also host a press briefing to provide an overview of the sustainable aviation fuel (SAF) market, identify the key policy measures needed to drive growth, and demystify the debate over lifecycle carbon emissions modeling, particularly as it pertains to the Treasury Department's guidance for the Section 40(b) SAF tax credit. Growth Energy is a proud member of Fuels America, and you can learn more about the coalition at fuelsamerica.org.

For more information, please contact Vice President of Government Affairs John Fuher.

IN REGULATORY AFFAIRS

Last week, legislation was introduced in Indiana to provide a retail tax incentive for fuel retailers selling E15 and higher blends. State Representative Craig Snow (R) sponsored House Bill 1315, which creates a $0.05 per gallon tax credit for every gallon of E15 or higher sold by a fuel retailer. If passed, the bill will expand choices at the pump for Indiana drivers and increase farm incomes for Indiana corn farmers, who currently sell 43% of the state’s corn to ethanol producers. Indiana is among several states considering E15 retail tax incentive legislation this year.

Earlier this week, Growth Energy's Senior Vice President of Regulatory Affairs Chris Bliley submitted comments to the California Air Resources Board (CARB) on their proposed changes to the Advanced Clean Cars II (ACCII) program. As Growth Energy has repeatedly noted to CARB, the approval of E15 can help the state achieve its greenhouse gas reduction goals and can provide a cost-effective, environmentally beneficial fuel for California drivers. Bliley also emphasized that California is now the only state in the country to have not approved E15—with Montana having approved it earlier this month—and dispelled some of the myths of fueling infrastructure replacement costs.

Additionally, Growth Energy voiced its support for E85, encouraging CARB to “implement policies that strongly incentivize and as necessary, require the production and use of flex-fuel vehicles, as well as continued investment in infrastructure for expanded access to E85 in the state.”

Among the changes to ACCII CARB are considering are if and how to align with the EPA’s proposed multi-pollutant emissions rule, develop new standards beyond 2025 model years to support climate goals, and “consider new measures to support the ZEV market.”

You can read Growth Energy's full comments here. 

Last week, Growth Energy’s Senior Vice President of Regulatory Affairs, Chris Bliley, spoke on a panel at the 12th Annual OPIS LCFS and Carbon Markets Workshop in San Diego. Bliley was joined on stage by Jeff Wilkerson of Pearson Fuels, Cory-Ann Wind of Clean Fuels Alliance America, and the panel was moderated by OPIS’ Director of Renewable Fuels, Jordan Godwin.  Bliley spoke about the opportunities in low carbon markets for bioethanol including some of the opportunities and challenges of the latest revisions to California’s LCFS. He also spoke about the latest developments on E15 including the recent move by Montana making it the 49th state to approve E15 and progress in California.

For more information, please contact Senior Vice President of Regulatory Affairs Chris Bliley.

IN MARKET DEVELOPMENT

Last week, U.S. Department of Agriculture (USDA) Secretary Tom Vilsack announced that USDA is awarding $19 million in grants to U.S. business owners to increase the availability of domestic biofuels in 22 states and give Americans cleaner, more affordable fuel options at gas station pumps as part of President Biden’s Investing in America agenda.

In June 2023, the USDA first announced funding through the Higher Blends Infrastructure Incentive Program (HBIIP) made available by the Inflation Reduction Act (IRA), making $450 million available for biofuel infrastructure over the following 18 months. The program will share the costs related to upgrading fuel dispensers (gas and diesel pumps), related equipment, Underground Storage Tanks (USTS), and other infrastructure required at a location to ensure the environmentally safe availability of biofuels. Eligible biofuels include E15, E85, and B5+.

In the current round of $450 million program funding, Growth Energy wrote 49% of the retail store grant applications that applied in round 1, including Casey's and Love's.

With the grant funding, Casey's will install 456 E15 dispensers at 111 fueling stations located across 5 states. For Love's, this project will retrofit 704 E15 dispensers at 88 fueling stations located across 17 states. Since 2014, Growth Energy has helped retailers across the country acquire $230 million in federal, state, and private grants that have gone toward making the necessary changes for them to offer E15 to their customers. 

HBIIP increases the number of Americans that benefit from falling gas prices by expanding the use of ethanol-based fuels at gas stations around the nation. Growth Energy CEO Emily Skor has previously praised this funding opportunity, saying "it will help our retail partners to expand options at the pump so more American drivers can save money and reduce their carbon emissions."

Read more about HBIIP funding here. Find out how the Growth Energy Market Development team can help by contacting MarketDevelopment@GrowthEnergy.org

For more information, please contact Vice President of Market Development Jake Comer.

Growth Energy is the leading voice of America’s biofuel industry, delivering a new generation of plant-based energy and climate solutions.

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The Rundown is the weekly newsletter for Growth Energy's members. It is published weekly by the communications staff at Growth Energy. For more information, email team@growthenergy.org or visit our website GrowthEnergy.org. 

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