Rep. Collin Peterson, congressman for Minnesota’s Seventh Congressional District and chairman of the House Committee on Agriculture, made a stop in Fergus Falls on Thursday to visit the ethanol plant Green Plains Otter Tail LLC. Peterson spoke with the plant’s general manager, Anthony Hicks, and addressed the Minnesota Renewable Energy Roundtable about his support for the ethanol industry and the hurdles it’s facing.
“I have been a big proponent of ethanol ever since 1979 when three guys that I knew created the gasohol commission,” Peterson said, adding that, when he joined the Senate in the late ‘70s, he helped work to get financing for the first ethanol plant in Minnesota in Marshall. “There’s some of us out there that are trying to make sure that this industry is maintained and viable.”
The ethanol industry is facing several problems that ethanol manufacturers like Green Plains hope advocates like Peterson can help resolve. “The small refinery waivers have definitely hurt our industry,” says Hicks, referring to the EPA’s small refinery exemptions that exempts small U.S. refineries from needing to blend biofuels like ethanol into their gasoline or buy credits from other refineries that do, an obligation placed on them by the Renewable Fuel Standard (RFS), if they can prove financial hardship. In 2018, ExxonMobil secured an exemption for one of its refineries in Montana, leading to criticism that the EPA is overusing the waivers and hurting demand for corn-based ethanol.
Peterson agrees. “(The biggest hurdle) is these waivers, there’s no question about it,” he says. The waivers cut into ethanol demand and therefore ethanol production, so that the 15 billion gallon mandate the EPA put out, guaranteeing 15 billion gallons of ethanol will be blended in the U.S., has not been met.
“We should have had 15 billion gallons over the last three or four years, and we had about 12 and a half billion, 12 billion, something like that, that is what caused corn to go below $3 because 40% of our market was ethanol,” Peterson said. “My goal for right now is 15 billion gallons of ethanol a year, period. That’s my goal. That’s the law and for right now we’re not going to go try to increase it or anything, all we have to do is go back to what they promised us and that would go a long way to helping the industry.”
Peterson is focusing his efforts on better tracking and management of the Small Refinery Exemptions, as well as paying out farmers who needed to depopulate livestock as a result of the coronavirus pandemic and plants that were forced to shut down, like the pork processing plant in Worthington, he says market access is another hurdle to overcome. “We compete, I don’t think there’d be any question that we could compete if we had the access but in a lot of the United States we don’t have access, Minnesota is ahead of the curve here, but we could compete if we just get access,” he says. “I don’t think there’s any question we could compete with oil. The problem is consumers don’t have the choice and there’s not enough money in my budget, in the ag budget, to be able to fund enough blender pumps even if people were willing to do it.”
Hicks says meeting with Peterson is valuable, not only to voice the company’s perspective on the industry and what help they could use (such as clearing the way for E15 sales and better educating regulatory agencies on the evolution of ethanol plants), but also to hear from the congressman. “It’s always good to hear from him directly as to what his thoughts and processes are, especially as we go into an election, it’s going to be an interesting election in general this year,” Hicks says. “Getting to know where the players sit and what they’re thinking is, that’s my goal, to know he’s still on board with supporting our industry.”