Driven by export demand, Iowa ethanol production hit a record 3.7 billion gallons this year, up 200 million gallons from 3.5 billion gallons in 2010.
Monte Shaw, executive director of the Iowa Renewable Fuels Association, said Iowa’s 41 ethanol plants produced 27 percent of the estimated 13.8 billion gallons of nationwide ethanol production.
“We relied on export markets for growth,” Shaw said. “We’re also facing the expiration of ethanol’s tax credit.
“Those factors place a premium on pushing the rapid commercialization of E15 (15 percent ethanol and 85 percent gasoline). Higher blends like E15 are the only way to guarantee increased ethanol production in the future and the jobs and foreign oil displacement that comes with it.”
While exports of ethanol rose, domestic demand has been flat because the industry hit the so-called “blend wall” federal mandate of 10 percent of total U.S. gasoline production early in the summer months. If E15 is approved by federal regulators, that would increase domestic demand for the biofuel.
Under the federal Renewable Fuel Standards Act, mandated use of ethanol by gasoline refiners will rise from 12.6 billion gallons in 2011 to 13.2 billion gallons in 2012.
Iowa is the renewable fuels leader among the states with 41 ethanol plants capable of producing 3.7 billion gallons annually. Archer Daniels Midland, with plants in Cedar Rapids and Clinton, is the largest Iowa ethanol producer with an annual capacity of 700 million gallons.
Iowa also has 13 biodiesel facilities with the capacity to produce 320 million gallons annually.
The U.S. Environmental Protection Agency on Thursday reported biodiesel production had reached an all-time high 908 million gallons through the end of November. The previous annual record for biodiesel production was 690 million gallons in 2008.
Made from a diverse mix of resources such as agricultural oils, recycled cooking oil and animal fats, biodiesel is the first and only commercial-scale fuel produced across the U.S. to meet the EPA’s definition of an advanced biofuel.