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September 15, 2003

Spokesman: Future of ethanol promising

By Lisa Chamley, Capital Journal Staff

The ethanol industry in South Dakota is flourishing and the future looks promising, industry representatives said at an ethanol town hall meeting held in Pierre Wednesday night.

Ron Lamberty, market development director for the American Coalition for Ethanol, said he is often asked is if there are too many ethanol plants in the state.

"The legitimate question is, are we making too much of this stuff?" Lamberty said.

In his travels, he speaks to petroleum companies who put those fears to rest.

"The question I get from them is, can we make enough for them?" he said.

In January 2004, California will ban methyl tertiary-butyl ether, an additive to gasoline that makes the fuel burn harder but is also a pollutant. That will open the market up for ethanol production. California's potential ethanol market is estimated at 1.5 billion gallons of ethanol; now, Californians use 15.5 billion gallons of gasoline annually.

Though opposition to ethanol has been strong by current California Gov. Gray Davis, studies done by the state have shown ethanol is in good supply, decreases noxious emissions and helps keep gas prices low, which is contrary to what the administration there has said, according to Lamberty.

"I say I love it when California does a study," he said.

The ethanol market will be affected by the renewable fuel standard provision now in the Energy Bill. Because of the need to replace MTBE in the nation's fuel supply, ethanol production is expected to jump from 1.8 billion to 5 billion gallons. That bill could be on the president's desk by mid-October.

Lamberty said the petroleum marketers do not oppose the ethanol production because it simplifies the fuel market. Marketers can't increase their supply; already, 60 percent of the petroleum used in the U.S. is imported.

"We think we have a decent chance of having the renewable fuels bill instated," Lamberty said.

All of that is good news for South Dakota, where one of every three rows of corn is planted for use in an ethanol plant, said Todd Anawski, program director for the South Dakota Corn Utilization Council and the South Dakota Corn Growers Association.

Of the state's 16,000 corn producers, about half of those invest in ethanol plants around the state, he said.

"Corn producers have benefited from ethanol production in the state. Corn prices are up 10 to 15 cents per bushel in one area," said Anawski.

Nine ethanol plants are currently in operation in South Dakota; two more, including the Sioux River Ethanol LLC in Hudson and VeraSun Energy in Aurora, are nearing completion.

Various other plants are in the planning stages, he said.

South Dakota will hit a milestone next year, when more than 400 million gallons of ethanol are produced.

Jeff Fox, a lobbyist for ethanol producers, said there currently is no legislative agenda for the industry.

Their focus now will be to continue to work with the administration to keep ethanol production healthy and expanding.

He noted that much of the ethanol produced in-state is sent west by railroad 3 million gallons at a time.

During the town hall meeting, District 24 Rep. Ryan Olson, R-Onida, asked about the prospects of the fuel E85. He was told by Lamberty that the fuel does have a future, but like all newly-introduced fuels, it has infrastructure and familiarity hurdles.

Olson, fellow District 24 legislators Tim Rounds, R-Pierre, and Sen. Patricia de Hueck, R-Pierre, were named "Friends of Ethanol." The award was given to those legislators who have voted favorably on ethanol-related issues.

District 27 Sen. Michael LaPointe, R-Mission, and Rep. James Bradford, D-Pine Ridge, were also given the award. Olson and LaPointe were the only legislators present.

Ellen Lee, a volunteer for the American Lung Association, said that organization favors ethanol because of the reduction of air pollution.

The ethanol town hall meeting was sponsored by the American Coalition for Ethanol, S.D. Corn Growers Association, the S.D. Farm Bureau and the S.D. Farmers Union.

Source: Capital Journal


 

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