at Plain Green Conference 2008.

1. Ethanol and Sustainability
Plain Green Conference
Sioux Falls, SD
Brian Jennings, Executive Vice President
American Coalition for Ethanol (ACE)
September 26, 2008

2. About ACE • Public Policy
• Market Development
• Public Relations &
Communications
• Grassroots Member
Empowerment

3. Outline
• General overview of ethanol production and use.
• Producing and using ethanol in a way that does
not compromise the environment or our food
supply.

4. 2007 Energy Bill
$100 + oil
2005 Energy Bill
RFS &
MTBERFS
MTBE
Clean Air Act
Clean Air Act Amdts
Public policies and market forces help drive
demand for ethanol.

5. About 60% of RFS from
advanced biofuels.

6. Use of Fuel Ethanol
• E10 – path of least resistance.
• E85 – 200 million cars on road, only 6 million FFVs.
1600 E85 pumps, around 170,000
stations.
Once we supply the E10 market…..E85 and…
• Other blends - E15, E20, E30, etc? Most pressing
issue facing the ethanol industry today, beyond E10.

7. Timely Challenges
• Volatility
• PR issues; “food v. fuel,”
land use changes, “good v. bad ethanol”

8. Factors impacting food prices
 Oil and energy prices – primary culprit - 80 cents of retail food
dollar.
 Unprecedented demand (growing dietary needs of China, India)
 Crop failures & poor crops (drought)
 Speculative investing in commodities
 Weak U.S. dollar
 Export restrictions (Argentina, Russia, etc)

9. Price Check: Oil vs. Corn
1949 2008 % Increase
Oil $2.54/barrel $125/barrel 4821%
Corn $1.24/bu $6.13/bu 394%
• Oil is in everything.
• Average food item travels 1500 miles before reaching grocery store.
Sources: National Farmers Union, USDA

10. Record corn exports in 07/08
90% of U.S. corn exports used by other countries to feed livestock.

11. Distillers grains from ethanol concentrate
nutrients for valuable livestock feed
Source: 2008 Feedstuffs Reference Issue; Ingredient Analysis Table. RFA

12. Corn: 1944 vs. 2007
Year Harvested Average Production
Acres Yield
1944 85 million 33 bu / 2.8 B bu
acre
2007 85 million 151 bu / 13.1 B bu
acre
Nearly 400% increase in production without
increasing acres in last 60 years.
Source: NCGA

13. More corn per acre…

14. …and doing so with less fertilizer.

15. Conservation practices on the rise
NO-TILL ACRES AS % OF REPORTING ACRES
40%
31.50%
% of Reported Acres
30%
26.50%
24.60% 25.30%
21.20% 20.90% 21.60%
20%
15.20%
10% 7.40%
0%
1990 1992 1994 1996 1998 2000 2002 2004 2006
Source: Conservation Technology Information Center

16. U.S. cropland erosion
Source: NRCS

17. Ethanol’s Decidedly
Positive Energy Balance
Btu of ethanol minus fossil energy used to make the ethanol

18. Ethanol’s Decidedly
Positive Energy Balance
g
an
W
ons
/
ET w
mpti
ntel
GRE
Pime
Assu
Btu of ethanol minus fossil energy used to make the ethanol

19. Climate Change Legislation to reduce
Energy includes transportation, coal (electricity), and other
manufacturing.
Source: Global Insight

20. Contributing to Global Warming?
• Accusing ethanol of Brazil
deforestation and global warming.
• Amazon clearing decreased 67%
since 2004, while U.S. ethanol
production doubled in the same time.
• In 2007, U.S. ethanol production
reached all-time high while Amazon
clearing fell to 20-year low.
Causes of Amazon deforestation*:
Brazil cattle/meat industry 60%
Subsistence agriculture 30%
*Source: Natl Institute of Space Research

21. U.S. ethanol production has
grown since 2004….
and deforestation
in Brazil has declined
during the same time

22. Ethanol replaces the incremental gallon of fuel,
increasingly from environmentally damaging
sources…
Research indicates that tar sands oil generates 150 to 300% more GHGs
than corn ethanol.

23. Ethanol Efficiencies
• Energy use decreased 21.8% from 2001 to 2006.
• 37% of the dried distillers grains with solubles (DDGS)
was sold as wet feed which reduces heat demand in the
plant between 2001 and 2006.
• Water consumption decreased 26.6%.
• One bushel of corn yields about 3 gallons of ethanol
today.
Source: Argonne National Lab, based on RFA survey.

24. 20% Greenhouse gas reduction
Reduction 28%
Reduction
assumptions from DoE
52%
Reduction
86%
Reduction
Gasoline Corn Ethanol Cellulosic
Ethanol
Petroleum Current Natural Biomass Biomass
Average Gas
Sources: Wang et al, Environ. Research Letters, May 2007; Wang et al, Life-Cycle Energy Use and
GHG Implications of Brazilian Sugarcane Ethanol Simulated with GREET Model, Dec. 2007.

25. In conclusion…
• It is inescapable; our status quo reliance on
fossil & foreign fuel is not a viable option.
• Ethanol is part of the solution. Homegrown.
Better for Environment. Ready Now.
• No silver bullets.

26. www.ethanol.org