US produces and blends record amounts of ethanol

New records were set in 2015 for US ethanol production and blending, with more than 14 billion gallons of ethanol produced, says the US Energy Information Administration (EIA).

According to the EIA data, US ethanol producers churned out 14.81 billion gallons of ethanol in 2015, while refiners and blenders integrated an unprecedented 13.69 billion gallons into the US petrol supply.

The industry’s monthly average output in December 2015 also crested the 1 million bpd mark for the first time in history.

Meanwhile, recent US Environmental Protection Agency (EPA) data shows that historic output levels of corn ethanol were primarily responsible for the generation of a record 14.83 billion renewable fuel RIN credits, which are used by oil companies to demonstrate compliance with the Renewable Fuel Standard (RFS).

Despite the record production, Bob Dinneen, president and CEO of trade association Renewable Fuels Association (RFA), said that the US ethanol industry was prepared to do even more.

But Dinneen cited “mismanagement” of the RFS programme and the oil industry’s reluctance to adopt higher-level ethanol blends, like E15, as keeping the ethanol industry from realising its full potential.

“The US ethanol industry had an incredible year in 2015, but the failure of the White House and EPA to enforce the RFS as designed by Congress means our nation missed a huge opportunity to provide consumers with even larger volumes of domestically produced, low-carbon, high-octane biofuels,” Dinneen said.

EPA set the 2015 blending obligation for renewable fuel at 14.05 billion gallons, rather than the 15 billion gallon level established by the US Congress.

Even though RFS requirements for 2015 were not finalised until November, Dinneen said the data from EIA and EPA show the volume requirement established by Congress could have been easily met by oil companies.

“There is no doubt that the ethanol industry could have produced even more renewable fuel if the administration had stood firm on implementation of the statutory RFS volumes, rather than caving to the oil industry’s ‘blend wall’ narrative,” Dinneen argued.

According to the RFA, the record December output rate of 1.002 million bpd would result in 15.36 billion gallons if maintained for an entire year, well above the 15 billion gallon blending requirement originally stipulated by Congress for 2015 and beyond.

“When the 14.83 billion new renewable fuel RIN credits generated in 2015 are combined with the existing surplus of 1.8 billion RINs that resulted from past over-compliance with the RFS, it becomes quite obvious that we had more than enough supply to meet the 2015 statutory renewable fuel volume of 15 billion gallons,” said Dinneen.

EIA data also shows that total US petrol consumption hit in 140.4 billion gallons in 2015, the third-highest on record and well above the projections used by EPA to establish 2015 blending obligations.