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life in rural nebraska

Ethanol and its Future

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Ethanol Plant in Ord

Ethanol Distillation in Ord

The GI Independent has an interesting take on the current financial health of the ethanol industry and its future, here.

With all the hoopla surrounding ethanol, especially here in Valley County as we wait on the bidding process for a new facility owner, I think it might be interesting to look at some numbers that the industry experienced in 2008. According to The Independent, the demand for ethanol grew in a time of major market volatility, marked by several major corporate bankruptcies.  “Demand for ethanol averaged 630,000 b/d in 2008, or more than 9.5 billion gallons. By comparison, ethanol demand in 2007 averaged 446,000 b/d.” In other words, demand grew by 70% between 2007-2008.

Future production models will also set to double overall national ethanol production by 2022.  According to the Independent, “the renewable fuels standard increases the volume of renewable fuels required to be blended into gasoline from 9 billion gallons in 2008 to 36 billion gallons by 2022.

Ethanol production is part of the national energy portfolio for the foreseeable future whether you agree with the standard or not.  Technological innovation, supply chain improvement and by-product spin-offs will all be a part of the evolving market niche for the future of the industry.  These improvements will provide solid business opportunity for current and future production facilities.  Market volatility, and in some cases pure greed, led to many of the ethanol industry’s stumbles, as in many other the downfall of many economic sectors, not just ethanol.

Public misinformation, however, blurs these lines between reality and fiction.  Mike Thede of Palmer sums up the real challenge ethanol’s future faces:  “We are constantly under attack by people using bad science, half-truths and things like that to detract from what ethanol brings to the table.”

For ethanol to prosper in a new energy mix demanded by the American people, the misinformation campaigns need to be addressed first and foremost.  Ethanol is one part of the solution for American energy independence – not the only solution.  Ethanol plays a significantly positive role in rural economic health.  A robust, sustainable ethanol industry is good for rural communities, good for America and especially good for Valley County.

Tomorrow, we hope to dig into some hard data that looks at the *direct* impact of ethanol in Valley County from ancillary job creation – not projected jobs created by our ethanol plant activity but concrete jobs created by having our facility in the area.

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Written by Caleb

March 25, 2009 at 4:14 am

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