While this issue of Ethanol Producer Magazine explores fermentation, markets, policy, feedstock use and the industry’s remarkable near-term outlook, the overarching theme is potential. Potential in yeast innovation, in the maritime market, in domestic and export markets, in D3 RIN feedstock blend optimization, in California policy advancements and more.&nbsp;Our coverage this month puts a fine point on a promising U.S. ethanol environment, the likes of which we haven’t seen in years.&nbsp;In our lead feature article, we examine the constant innovation coming from yeast and enzyme providers. They never rest. As markets shift in response to carbon intensity incentives or price volatility, these experts seem to easily adapt to producer needs and desires, ensuring their products perfectly achieve ever-evolving goals with no unwanted side effects. Central to this innovation, of course, is yield maximization and robustness. See what the top yeast and enzyme developers say about their newest products, starting on page 16.Next, we take a deep dive into the maritime market—a prospect for U.S. ethanol that some experts say is bigger than the parallel opportunity of sustainable aviation fuel. More than 100 ships on the water today are designed to run on methanol and could easily use ethanol. Another 300-plus clean-fuel vessels will leave shipyards over the next 18 months. The market has far fewer hurdles than the SAF market and the first movers in the space are already buying their ethanol-fueled ships. Find it on page 24.Perhaps the clearest picture of the upcoming boom in ethanol is outlined in the article starting on page 32. The experts explain the factors driving a market boasting more favorability than we’ve seen in 20 years, including incentives, global conflict impacting oil supply and demand, E15 and cost benefits, record-high Renewable Volume Obligations, and already record-high exports. Ethanol seems to be on top.Edeniq and IFF have been hard at work on research to pinpoint the optimal sorghum/corn blend for D3 renewable identification number (RIN) generation. It’s not a simple project, with its many complex factors to consider, but the teams were meticulous in their work and released their results earlier this year. Learn what they found on page 38.Last, we outline the current ethanol potential in California, with progress on allowing E85 conversion kits—which would boost the blend’s already robust in-state presence—and the details of E15 implementation getting worked through. It’s on page 46.&nbsp;With domestic and international markets growing, this industry is poised to take off, again. Clearly, it’s a good time to be in ethanol.&nbsp;&nbsp; -The Editors

2026-05-27 - Focused On Potential (Ethanol Producer Magazine)

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The July issue of Ethanol Producer Magazine explores fermentation, markets, policy, feedstock use and the industry’s remarkable near-term outlook.

Focused On Potential

May 13 will go down in ethanol industry history books as a watershed day for our nation’s renewable fuel producers, farmers and consumers. On that day, the House of Representatives passed HR 1346, the Nationwide Consumer and Fuel Retailer Choice Act, by a vote of 218-203. The bill, which headed to the Senate upon passage by the House, allows year-round, nationwide sales of E15 and makes targeted reforms to the Renewable Fuel Standard’s small refinery exemption (SRE) program. While the final vote tally itself may at first appear unremarkable and ordinary, a deeper look reveals just how noteworthy and unusual this vote really was.First, it is exceedingly rare for stand-alone legislation on a narrow policy issue to get time for debate and a vote on the House floor. In recent years, this type of bill has almost always been attached to a larger package of must-pass legislation to ensure it has a chance of advancing out of the House. Indeed, stand-alone legislative proposals typically die a quiet death in the committee of jurisdiction. But, given the urgency of bringing lower-priced fuel to the pump and supporting America’s farmers, HR 1346 took a much different path to the House floor.Second, neither party’s leadership team took a position on the bill. House Speaker Mike Johnson (R-LA) and Majority Leader Steve Scalise (R-LA) didn’t whip Republican votes on the bill; in fact, they both voted “no” on it. The only instruction they gave to Republican members was to “vote your conscience.” Minority Leader Hakeem Jeffries (D-NY) and Minority Whip Katherine Clark (D-MA) both voted “yes,” but also didn’t provide any voting recommendations to House Democrats. It is incredibly unusual for a bill to pass when leaders from both parties take a hands-off approach and stay on the sidelines.&nbsp;Third, and most remarkable, the vote on HR 1346 was truly bipartisan and showed a broad base of support across the political and geographical spectrum. The final tally showed that 122 Republicans joined with 95 Democrats and the House’s lone Independent to vote “yes” on the bill. This is an incredibly rare feat. In an era of bitter partisan divisiveness and tribalism, the vote on HR 1346 served as a bright beacon of hope that bipartisanship and cooperation are not dead. Even a handful of far-right Freedom Caucus members voted in favor of the bill; and on the far left, more than two dozen members of the Congressional Progressive Caucus voted “yes.”The vote proved that year-round E15 and SRE reform are not just “Corn Belt” issues. Rather, they are pocketbook issues important to every American household. Yes, representatives from farm states like Illinois, Indiana, Iowa, Minnesota, Nebraska, Ohio and the Dakotas overwhelmingly voted in favor of the bill. But entire House delegations from Alaska, Kentucky, Mississippi, Nevada and West Virginia also voted unanimously in support. The bill also saw plenty of “yes” votes from members representing districts in Florida, Georgia, North Carolina, New York, and even Texas.How did this happen? It all started with a broad coalition of supportive, active and effective stakeholders. Over the past several years, RFA has helped build a year-round E15 advocacy juggernaut that includes oil refiners, farmers, fuel retailers, veterans, consumer groups and other important voices.But more generally, HR 1346 is simply good policy. Allowing year-round access to E15 and reining in SREs will lower prices at the pump, deliver cleaner air, support the farm economy and strengthen our nation’s energy security. Who wouldn’t be in favor of that?Now the ball is in the Senate’s court, and we are urging the upper chamber to follow the House’s lead. Our message is clear: embrace bipartisanship and collaboration, follow the science, ignore the noise and misinformation from opponents, and act swiftly to make year-round E15 a permanent reality. We’re counting on you.&nbsp; &nbsp;Author: Geoff Cooper&nbsp; President and CEO&nbsp; Renewable Fuels Association

2026-05-27 - E15 Proves It: Bipartisanship Is Not Dead (Ethanol Producer Magazine)

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Renewable Fuels Association President and CEO Geoff Cooper calls on the Senate to pass E15 legislation. 

E15 Proves It: Bipartisanship Is Not Dead

The last 10 years of biofuels policy in the European Union have been challenging, not just for an industry looking for some investor confidence, but also for anyone who wants to see more renewable energy in transport.&nbsp;During that time, the EU ethanol sector has faced several threats of extinction from misguided European Commission proposals aimed at phasing out the use of crop-based biofuels, even though they are the main renewable energy source in EU transport.But lately there’s been a change of tone from some key EU policymakers, who now talk about the importance of “homegrown” renewable energy sources, including biofuels, as Europe searches for ways to reduce its dependence on imported oil.&nbsp;Take a look at some recent quotes from top EU officials since the start of the Iran war.In March, Christophe Hansen, the European Commissioner in charge of agriculture policy, talked about how EU ethanol biorefineries could be better used to boost domestic food and fuel production. “There is a huge potential to do more,” Hansen said. “We have refineries all over Europe and all of them are under their maximum capacity.”&nbsp;Hansen also shot down the long-running “food vs. fuel” myth that has been used by anti-biofuel lobbyists to impose limits on how much crop-based biofuels can count toward EU renewable energy targets—limits that have left the EU needlessly over-reliant on fossil fuel for transport.“The ‘tank vs. plate’ dilemma belongs to the past,” Hansen said.But there was more to come. As EU leaders scrambled to combat the energy crisis created by the Iran conflict, a statement from the Commission’s Directorate for Energy said: “Increasing the uptake of biofuels could help substitute for fossil petroleum products and alleviate pressure on the market.”&nbsp;Then the European Commission released its AccelerateEU plan aimed at assuring EU energy security and reducing dependence on foreign oil, in which it also calls for increased domestic EU production of sustainable biofuels.But perhaps the most noteworthy words came from the president of the European Commission, Ursula von der Leyen. In a speech to the European Parliament, von der Leyen said: “We must reduce our overdependency on imported fossil fuels and boost our home-grown, affordable, clean energy supply.”But von der Leyen has gone even further than that. In a letter to German members of the European Parliament, she specifically mentioned E20, a petrol blend with up to 20% renewable ethanol, as a viable alternative to fossil fuel with lesser amounts of biofuel and suggested the Commission would look at updating the EU’s Fuel Quality Directive to authorize its use.“The Commission confirms the role that higher biofuel blending can play in decarbonizing existing vehicle fleets,” von der Leyen wrote. “As part of the revision of the policy framework for fuels, the Commission will consider authorizing higher ethanol contents (E20).”These are welcome signs that the Commission recognizes the strategic importance of EU renewable ethanol biorefineries producing food, feed, fuel and biogenic CO2 to help achieve Europe’s goals for transport decarbonization, energy independence, food security, and industrial and agricultural autonomy.Let’s hope the words will be followed up with actions to unleash the potential of the EU renewable ethanol industry for replacing fossil fuel, giving European citizens access to cheaper renewable energy sources, boosting food and feed production, and supporting agriculture and industry.Author: Craig Winneker&nbsp; Acting Secretary General of ePURE, the European Renewable&nbsp;&nbsp; Ethanol Association

2026-05-27 - Is Europe Changing Its Mind On Biofuels (Again)? (Ethanol Producer Magazine)

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Policymakers in the European Union have been changing their tone when it comes to biofuels, including ethanol. 

Is Europe Changing Its Mind On Biofuels (Again)?

Since 2020, the ethanol industry has seen a steady resurgence in demand, driven by expanding export markets, increasing decarbonization targets, and a renewed focus on domestic energy independence. As a result, producers are being asked to deliver more: pushing plants, processes and feedstocks further than ever before.With strong margins across ethanol, distillers corn oil (DCO) and dried distillers grains (DDGs), plants that can operate at higher production rates hold a clear financial advantage. Maximizing output, without sacrificing efficiency, has become a defining factor in plant performance and long-term return on investment.Increasing Throughput Without Compromising Yield&nbsp; High-throughput ethanol production focuses on increasing the volume of corn processed to drive greater output of ethanol and coproducts. This can be achieved by increasing corn grind for higher solids and ethanol concentration in fermentation, or increasing the number of fermentations produced per unit of time. In either case, more ethanol gallons, DCO and DDGs are produced, which can significantly add to a plant’s bottom line. Increasing yield will always be important for ethanol producers, and improving a plant’s efficiency by increasing throughput allows producers to double-down and push their facilities to maximize return on investment. &nbsp;Even in low-margin market conditions, a higher throughput operations model is rarely a negative business decision.A common misconception is that higher throughput must come at the expense of yield, which can be true if the conversion tools in place can’t manage the demands of today’s ethanol plant operations. When yeast cannot tolerate the increased stress of high solids, elevated ethanol concentrations, or rising temperatures, plants are forced to pull back and reduce efficiency, especially during warmer months when cooling capacity is constrained.The result can include lower dry solids, stalled fermentations or even complete batch losses. In these environments, consistency suffers and variability increases, ultimately impacting both yield and throughput.The Biological Bottleneck&nbsp; “Biological factors like the industrial yeasts used in fermentation can absolutely be a bottleneck to increasing throughput,” says Kim Bertz, senior marketing manager at Novonesis. “Achieving higher solids, moving from 34.5% to 35.5%, and increasing ethanol titers from 15.5% to 16.5% w/v are key to unlocking throughput. But many conventional yeasts struggle to perform beyond 33.5% solids and 14.5% ethanol.”Without yeasts capable of operating under these intensified conditions, plants risk leaving value on the table. The ability to maintain fermentation stability under stressors like high heat, high ethanol concentrations and variable process conditions is critical to reducing variability and protecting output.Powering the Possibilities of Your Plant&nbsp; “When developing the Innova™ yeast portfolio, we started with our customers’ biggest challenges,” Bertz explains. “We asked what was limiting their fermentations and what it would take to help them push beyond those constraints.”The result is a platform of “fit-for-purpose” biosolutions designed to perform under the demanding conditions of modern ethanol production. With our newest yeast biosolutions like Innova™ Nitro and Innova™ Eclipse, producers can push solids up to 36% w/w and achieve ethanol titers above 16% w/v, while maintaining fermentation performance—even during temperature excursions exceeding 100°F.This level of robustness gives producers greater operational flexibility, whether that means increasing grind rates, shortening fermentation times or reducing sensitivity to seasonal variability.Redefining What’s Possible&nbsp; “Yield is king” has long been a guiding principle in ethanol production. But today’s environment demands more. Producers are looking for ways to maximize both yield and throughput without compromise.With the right biological foundation, that balance is increasingly achievable. Instead of working around the limitations of fermentation, plants can begin to optimize their entire operation: running faster, pushing harder and capturing more value from existing assets.As ethanol producers continue to navigate evolving market dynamics, from new carbon intensity targets to increasing demand for low-carbon fuels, the ability to do more with existing assets will define long-term competitiveness. High throughput strategies, enabled by robust and purpose-built biological solutions, offer a path to unlock additional value without major capital investment. In this environment, the question is no longer whether plants can push harder, but how confidently and consistently they can do so.&nbsp; &nbsp;Author: Novonesis

2026-05-27 - SPOTLIGHT | NOVONESIS: Fast & Furious: Throughput and the  Biosolutions for Success (Ethanol Producer Magazine)

Since 2020, the ethanol industry has seen a steady resurgence in demand. As a result, producers are being asked to deliver more: pushing plants, processes and feedstocks further than ever before.

SPOTLIGHT | NOVONESIS: Fast & Furious: Throughput and the  Biosolutions for Success

2026-05-27 - Innovation Underway (Ethanol Producer Magazine)

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Yeast and enzyme developers are rising to ethanol producers’ challenge for higher throughput without lowering batch yields.

Innovation Underway

Strategies for ethanol to fuel ocean-going vessels are gaining steam as industry trade groups work to ensure supportive polices. Treading carefully with a reluctant Trump administration, biofuel groups hope to get the U.S. back on board with a global regulatory push for low-carbon maritime transport. &nbsp; &nbsp;“I believe this is the single biggest opportunity the ethanol industry has,” says Zoltan Szabo. Based in Hungary, Szabo is secretary general of the Climate Ethanol Alliance—a global partnership representing trade groups and companies from the U.S., Europe, Brazil, Canada and Asia. “The maritime sector needs fuels that are low-cost, available and scalable, [and] that come with low carbon intensity. Ethanol ticks all the boxes, and that’s why we believe that we need to do all we can to make sure that the maritime opportunity becomes a reality.”Top of the list is getting approval for a global standard supporting the use of alternative fuels. The International Maritime Organization’s Net-Zero Framework was close to being finalized when the U.S. lobbied to delay the decision. “It took everyone by surprise last October that the U.S. was not supportive, because they had been beforehand,” Szabo says.The IMO is a United Nations agency with an elected 40-member council. Half of the council is comprised of countries with heavy involvement in international shipping and trade, while those without large maritime transport footprints have broad commercial and geopolitical ties to the sector. &nbsp; &nbsp;&nbsp;The agency has been striving for international accord on its Net-Zero Framework for years. “The IMO works by consensus,” Szabo says. “And, up until last year, there seemed to be an agreement.”The global fuel standard within the framework requires ships to gradually reduce GHG emissions, and it includes a pricing mechanism on emissions to encourage compliance. It was approved by the IMO’s Marine Environment Protection Committee in April 2025. The draft legal text was shared with UN member states aiming for formal adoption in October 2025. After the U.S. and other oil-producing countries lobbied against it, the final vote was deferred &nbsp;until November of this year. &nbsp;“There’s a lot of reasons why the Trump administration did not like that approach,” says Troy Bredenkamp, senior vice president, government and public affairs at the Renewable Fuels Association. “They saw the net-zero proposal as a global tax, through the fines that were going to be imposed by those not meeting the new, very stringent standard.” &nbsp;&nbsp;“There were some specific elements of the framework that the administration was very concerned about,” concurs Chris Bliley, senior vice president of regulatory affairs at Growth Energy. “They’re not going to support anything that includes a penalizing mechanism. They’re very focused on reliable energy for all approaches. In their view, they don’t think there should be limits on specific fuel types.&nbsp;“I think it’s important that the administration is going to continue to engage, but they’ve made their position clear. For us, it’s emphasizing that it’s important the U.S. remains engaged because of the market potential for American producers and ultimately American farmers.”&nbsp;When the approval process for the IMO framework was paused last fall, RFA formed the American Biofuels Maritime Initiative with the American Biogas Council and others to help the administration understand the domestic biofuel sector’s position, Bredenkamp explains. “[They should] stay at the table and come up with some kind of global maritime fuel standard framework that they are able to support,” he says. This spring, Bredenkamp reported, the effort seemed to be moving in the right direction. &nbsp;Superseding the EU&nbsp; While the compliance cost of the proposed global standard is a sticking point, Bredenkamp says, “There is a cost to doing nothing, as well, specifically from regional standards. &nbsp;&nbsp; “If there’s not a single global standard, the concern is [broader global acquiescence to the existing] EU standard, or [the creation of] an Asian standard, because the world continues to move towards cleaner fuel standards,” he adds. “You’re going to have a patchwork. So another point we’re trying to make with the Trump administration is that it would be far better to have a single standard.”In the absence of a global standard, the EU’s standard would have an outsized influence, Szabo explains. “And in a bad way, because shipping is global. From the U.S. to Tokyo, the EU system wouldn’t be involved, but many routes include a stopover or final destination in Europe. Then, obviously, you would have to respect the EU regulatory framework, which … penalizes crop-based biofuels.”Under the FuelEU Maritime regulations, shippers must purchase allowances for emissions that exceed EU benchmarks, which increase over time as the standards become more stringent. The regulations add significant costs, currently at about 15% more for gray methanol, 20% higher for LNG and more than 30% higher for bunker fuel oil. Crop-based biofuels are assessed the same penalties as petroleum-based bunker/marine fuel. Green methanol and ammonia, bio-LNG from certain feedstocks and biobased diesel from waste oils are assessed little or no penalty. A single, global emissions standard, such as the IMO Net-Zero Framework, would supersede the EU program and any other emerging regional policies, Szabo says.“Without the support, without the buy-in of the U.S., a global regulatory framework will not be adopted,” Szabo says. “This is not to be seen as a climate deal. This is to be seen as a trade opportunity because the U.S. industry would benefit a lot. U.S. ethanol is one of the most cost-competitive renewable fuels on the market, if not the most cost-competitive. As such, once there is demand, it will be the first to supply. It will be a major outlet not only for ethanol, but also bio-LNG and biodiesel.” &nbsp;&nbsp;Szabo doesn’t expect clarity on the issue until the November vote nears. “There is an intense negotiation happening &nbsp;on the floor at the IMO, and also behind the curtains,” Szabo says. As the only biofuels organization with consultative status, though not a vote, the Climate Ethanol Alliance can participate in the discussions and submit proposals. He adds they are willing to speak for not only ethanol, but other biofuels such as biodiesel or bio-LNG.&nbsp;“Shipping is global and shippers want a single regulation, rules that are applicable all over the place,” Szabo says. “Shippers are investing with dual-fuel ships on the waters already using alcohols, and many more on the order books.”&nbsp;Vale, a Brazilian mining company, is among the first companies to place orders for ethanol-powered ocean-going vessels. The company announced in April that it has commissioned multiple tri-fueled Guaibamax vessels, with the first to be delivered in 2029 by China shipbuilder Shandong Shipping Corp. The iron ore transports can be powered with ethanol, methanol and/or bunker fuel, with retrofit options for LNG and ammonia. In the news release, Vale reports investments of about $1.4 billion to reduce its Scope 1, 2 and 3 emissions. The company has committed to reducing Scope 3 emissions by 15% by 2035, which relate to the value chain, including the majority of emissions from maritime transport. (Ethanol Producer Magazine covered other engine and shipper developments in a feature in the March issue titled “Ethanol’s Next Big Wave.”)In its response to the news, the Climate Ethanol Alliance called Vale’s announcement “first-mover validation.” Ethanol has long been discussed as a marine fuel, but never deployed at this scale, plus the 25-year framework of the purchase agreement “shows this is not a pilot, but a strategic shift.”Education, Research Ahead&nbsp; Achieving the maritime opportunity goes beyond getting a global framework that doesn’t penalize crop-based biofuels. “This is pretty new to us as an industry and for government stakeholders and others,” Bliley says. “There’s a lot of education to be done and some research as well.” That work includes understanding the logistics. “We ship ethanol all over the world, but currently we are not used as bunker fuel. So are there things that need to be done?” &nbsp;&nbsp;On the domestic policy front, legislation has been introduced to include maritime use in the Renewable Fuel Standard. “It’s a bill that the RFA has been supportive of conceptually,” Bredenkamp says. But while the current bill would allow biofuels sold for maritime use to generate RINs, Bredenkamp suggests it needs some work. “There are other aspects to the RFS that would have to be considered, like obligated parties.”&nbsp;How quickly the maritime market for ethanol will grow is uncertain. Ocean-going vessels stay in service for decades, so turnover is slow, although retrofits are being developed. “When you’re talking about a market of 80 to 90 billion gallons annually, it doesn’t take very many ships to add up to a lot of gallons,” Bredenkamp says.“The marine market is massive, so even if we only get a percentage as the number of ethanol capable ships get built out, you’re talking about a multibillion-gallon opportunity to be sure,” Bliley says. “As you know, 2 billion gallons of exports makes a massive difference. So if you’re talking 4 or 5 billion gallons in the marine market, it would be tremendous.”&nbsp;“I know how excited everyone was about sustainable aviation fuel a couple of years ago, and there’s reason for excitement there,” Bredenkamp says. “But I think there is more reason to be excited about the maritime opportunity. Ethanol is a drop-in fuel, the infrastructure is already there at a lot of the ports. We perform well from a carbon-intensity reduction perspective and, from an affordability perspective, we pair well with bunker fuel.”&nbsp; The RFA examined maritime fuel prices at major world ports to see how a 50-50 ethanol/bunker blend might compare and, while more costly than conventional petroleum-based fuels, the 50-50 blend was less costly than other alternative fuels.&nbsp;All the conversations over the maritime fuel opportunity are leading to other new opportunities, Bredenkamp adds. “The American Waterways coalition has come to us.” The trade association represents tugboat, towboat and barge operators who are looking for ways to clean up their fuel use. “We’re finding more opportunities that are coming forward. That’s another reason why we’re getting more and more excited.” Author: Susanne Retka Schill&nbsp;&nbsp; writer@bbiinternational.com&nbsp;

2026-05-27 - On Board With Maritime Policy (Ethanol Producer Magazine)

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Ethanol checks all the boxes for clean alternative fuels in ocean-going vessels.

On Board With Maritime Policy

Record-high Renewable Volume Obligations in the RFS Set 2, lucrative 45Z Production Tax Credits, continuously growing export demand and surging oil and gas prices highlighting the need for E15: The ethanol industry is in the midst of a boom eclipsing any in recent memory.&nbsp;“I’ve been in this industry a long time and I don’t remember a period where the outlook has been brighter for ethanol production and demand, maybe with the lone exception of 2007 when we got the RFS 2 passed,” says Geoff Cooper, president and CEO of the Renewable Fuels Association. “You’ve just got this convergence of factors very favorable for growth and expansion in the industry.”Demand signals are extremely strong, both in exports and domestically, he adds.“The economic activity is unlike anything we’ve seen in probably 20 years. We are on the precipice of that next big boom of the ethanol industry.”The Big Boom&nbsp; RFS Set 2, finalized in March, effectively requires 15.7 billion gallons of conventional renewable fuel in 2026 and 2027.&nbsp;“We think it is sending a very bullish, very positive signal to the marketplace to ramp up production,” Cooper says. “We’ve not only got a 15-billion-gallon-plus RVO for conventional fuels like ethanol in 2026 and 2027, but we’ve also secured reallocation of 70% of the small refinery exempted volumes from the past three years.“And that would be the highest-ever requirement,” Cooper says. “Frankly, meeting those volumes is going to require E15.”Current Reid Vapor Pressure rules restrict E15 from being used in the summer months. While RVP waivers granted each year for the past seven years have allowed E15 year-round in many areas of the country, the fix has been “patchy and uncertain,” says Ron Lamberty, chief marketing officer for the American Coalition for Ethanol.&nbsp;The U.S. House of Representatives passed year-round E15 legislation on May 13, sending it to the Senate. The Senate had yet to vote on the legislation as of press time. President Donald Trump has previously said he is ready to sign year-round E15 legislation once it crosses his desk. Nationwide E15 would add 5 billion to 6 billion gallons of new ethanol demand, Cooper says. It wouldn’t happen overnight, but could happen fairly quickly, he adds.&nbsp;“I would love for people to [appreciate] ethanol for its environmental benefits or its rural economic benefits, or its all-American benefits,” Lamberty says. “But the fuel business is about price.”“Ethanol is the lowest-cost liquid fuel available on the global marketplace,” Cooper says. “It has been for the past 10 or 12 years and that advantage is only widening in the wake of the Iran situation and the closure of the Strait of Hormuz.”The RVOs help to put emphasis on the need for year-round E15, but so does the ongoing war in Iran. Climbing oil and gas prices from the war and the subsequent closing of the Strait of Hormuz are pushing interest in measures to lower costs for consumers.In May, ethanol was selling for about $1 per gallon less than gasoline blend stock on the global market. That translates to about 30 to 40 cents per gallon at U.S. pumps.&nbsp;“I think the current situation in the Middle East is really putting an exclamation point on the energy security and economic benefits of ethanol, and we’re seeing that across the globe,” Cooper says. “We’re going to be living with high gas prices for a while, regardless of when the conflict ends, and when traffic starts flowing through the Strait again.”&nbsp;As of press time, the Strait of Hormuz was open to only limited traffic and the conflict in Iran, while subsiding in late May, remained ongoing.&nbsp;Twenty percent of the world’s oil supply goes through the Strait of Hormuz, according to Lamberty. “You’ve got the rest of the world trying to supply the markets that oil went to,” he adds.But even after the conflict settles and the Strait fully reopens, backfilling demand and catching up with the market will take weeks to months. “What we’ve seen historically is that these types of demand and supply shocks have &nbsp;long tails—prices go up very quickly and take much longer to come back down to pre-shock levels,” Cooper says. “But we have never seen a supply shock of this magnitude. So, I don’t think even looking at past incidents is necessarily indicative of how this is going to go.”&nbsp;In response, many countries are committing to increasing their use of ethanol from reliable supply sources, including the U.S.. &nbsp;U.S. exports climbed to record highs in 2024 (1.93 billion gallons) and 2025 (2.2 billion gallons), as countries around the world set aggressive goals, policies and targets for increasing their use of renewable fuels. Cooper says the Iran conflict builds on that existing demand.&nbsp;“We see the situation in the Middle East really catalyzing increased exports and increased use of ethanol globally, and we believe the U.S. industry is well-positioned to benefit from that push.”Cooper expects the U.S. ethanol industry to export at least 2.5 billion gallons this year, but potentially more, depending on the duration of the turmoil in global oil markets. Already, first-quarter exports set a record of nearly 640 million gallons, 20% above the same period last year.&nbsp;Meanwhile, producers on the Trailblazer pipeline and others with carbon capture and storage strategies have started collecting 45Z Clean Production Tax Credits. Green Plains, which has three Nebraska ethanol plants on the pipeline, reported it received $55.2 million through 45Z credits in the first quarter of 2026. The credit is yet another positive marker contributing to U.S. ethanol’s boom.‘Capacity Creep’&nbsp; The U.S. ethanol industry has over 18 billion gallons in capacity today and has been running at an annualized rate of around 17 billion gallons in recent months, primarily because of the strength in the export market, Cooper says.&nbsp;There is room to grow in the existing fleet.“The other thing we know is happening is virtually every facility is looking into adding capacity, through debottlenecking or modest expansions,” he says. “That capacity creep is moving forward and has really accelerated in the last six months, to the point that we think the industry will have the capacity to produce 19 billion gallons or more as soon as the end of this year, or certainly a year from now.”&nbsp;Several producers are working on expansions, including: POET Bioprocessing-Shelbyville, from 98 MMgy to 193 MMgy; One Earth Energy, from 150 MMgy to 200 MMgy; The Andersons Clymers, from 140 MMgy to 170 MMgy; and Gevo North Dakota from 67 MMGy to 75 MMgy, as well as a new 75 MMgy plant adjacent to its existing facility.&nbsp;“We have seen some publicly announced expansion plans but there are a lot of things happening under the radar, undertaking improvements, projects and process efficiency initiatives to produce 125 or 130 from 120 (MMgy),” Cooper says. “You start adding all of those up and all of a sudden, we’ve got another billion gallons of capacity in a very short time.“The incentive is there, the signal is there from the marketplace to continue ramping up production,” Cooper adds. “The market is responding. Every ethanol producer out there is looking at ways to boost their output.“I think it’s just the very favorable policy environment that we find ourselves in today. Highest ever RVOs, feeling we’ll get E15 done this year, 45Z tax credit, and export market,” he says.&nbsp;“You add those things together and throw a global event like Iran ontop of it and the signals are screaming to the industry to increase capacity, increase productive capabilities, and that’s what we’re seeing today.” Author: Lisa Gibson&nbsp; lisa.gibson@sageandstonestrategies.com&nbsp; &nbsp;

2026-05-27 - Strong Market Signals (Ethanol Producer Magazine)

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Global upheaval, E15 tailwinds, landmark RVOs and other factors push ethanol into the most promising environment the industry has seen in years.

Strong Market Signals

The results of a recent study testing the optimum blend ratio of corn and sorghum for the generation of D3 cellulosic renewable identification numbers (RINs) show the best blend to be 60% sorghum/milo to 40% corn. Under normal fermentation conditions, returns begin to diminish outside of that ratio.&nbsp;The “Corn and Sorghum Cellulosic D3 RIN Study” was released in February, backed by the National Sorghum Producers and the Renewable Fuels Association. IFF collaborated with Edeniq Inc. to source corn and sorghum from operating ethanol plants, running lab-scale fermentations of various blend ratios.John Duff, founder of Serō Ag Strategies and consultant to the National Sorghum Producers, helped conduct the research to build the report. “Sorghum has more raw fiber in it than corn,” he says. “The question is, does that come out in the ethanol to create D3 RINs? This study helps us understand that.”Methods and Team&nbsp; Jacyln DeMartini, senior lead scientist at IFF, has led the company’s grain research team and worked at the intersection of research and development and grain processing for 15 years.“We wanted to show collaboration and partnership on some of the big work being done here,” DeMartini says. “This work was different in how broad and applicable to the industry it was.”&nbsp;A new and better understanding of feedstock flexibility and feedstock combination opportunities is highly beneficial to the industry, she says. Until now, this type of information was not well understood, especially not for the generation of cellulosic ethanol RINs.&nbsp;The analysis included recordings of starch converted fractions (how much of the starch within the mix was converted to ethanol), cellulose converted fractions (how much of the cellulose in the mix was made available for conversion) and cellulose ethanol fractions (how much of the available cellulose was converted into ethanol).&nbsp;According to DeMartini, accounting for every detail was crucial for obtaining accurate results and laying the groundwork for a wider industry understanding. Or maybe, she adds, future plant-by-plant custom analyses.&nbsp;For its portion of the collaborative study, IFF sourced flour and backset of both feedstocks. Lincolnway Energy provided corn flour and backset—the remaining stillage after distillation that often gets recycled into the next fermentation round—and Western Plains Energy provided the sorghum equivalent. In addition to its own testing, IFF sent out the flour samples to a third-party participant, Midwest Laboratories.&nbsp;With all the necessary samples, IFF performed the liquefaction and blending processes that created a final mash. The mash dry solids value was roughly 33%. Other variables like pH, alpha amylase and temperatures were all matched to industry norms. Temps during agitation were 87.8 degrees Celsius for the first 20 minutes, followed by 100 degrees Celsius for an additional 10 minutes; pH levels were set at 5.1.&nbsp;After lowering temps back to 87.8 degrees, another round of alpha amylase was added. That mash was then agitated for two hours to mimic normal liquefaction procedures. An ice bath was used to cool down the mash after the two-hour run time. After some additional steps that added urea to create a corn and sorghum liquefact product, IFF moved to a simultaneous saccharification and fermentation step.&nbsp;Commercially normal doses of yeast, glucoamalyse, protease and cellulose were added to the blends, which were then fermented in flasks for 72 hours at roughly 32.2 degrees Celsius.&nbsp;IFF produced six different blends to be tested for cellulose ethanol fraction levels. Blend one was 100% corn liquefact; blend two was 80% corn and 20% sorghum; blend three was 60% corn and 40% sorghum; blend four upped the sorghum blend to 60% and lowered the corn portion to 40%; blend five was made of 80% sorghum and only 20% corn; and the sixth was 100% sorghum.&nbsp;“Once we confirmed that everything looked good, we froze the samples and shipped them off to Edeniq,” DeMartini says. &nbsp;When the samples arrived at Edeniq, they were given two to three days to dry. A longer drying time could have caused unnatural decomposition, according to Johann Venter, chief technology officer at Edeniq. The Edeniq team applied the ASTM Standard E3417-25, a process that includes inlet and outlet density, inlet and outlet dry weights, inlets and outlets for starch, outlet ethanol and the inlet and outlet cellulose/hemicellulose-derived glucan and galactan (CHDGG).&nbsp;The CHDGG values calculated using the ASTM process were then applied to Edeniq’s proprietary mass balance calculation to determine starch converted fraction, cellulose converted fraction and cellulose ethanol fraction.Clear Results&nbsp; The results were clear on two fronts. The starch converted fraction for each blend was consistently above 97%, the study shows, which is normal for the high efficiency of current enzymes used in the industry. For the cellulose converted fraction, the study results showed the maximum conversion reached was roughly 27.4% (for the fourth blend). The fourth blend was 40% corn and 60% milo. That blend reached 1.35% cellulose ethanol fraction.&nbsp;According to Venter and DeMartini, sorghum percentages higher than 60% begin to diminish returns. Although increased sorghum volumes will increase the amount of cellulose converted fraction levels (sorghum has more fiber available to convert), the increase in cellulose ethanol fraction percentages is not worth the added sorghum.&nbsp;“I thought it was interesting that you did see a trend with increasing sorghum and then it leveled off,” DeMartini says. “I thought we’d see a linear trend all the way up.”&nbsp;In the future, she hopes to explore why the conversion plateau happens.&nbsp;“It’s another reason why lab studies are very diligent about detail. It improves our understanding of the situation,” she says. “The smallest details are very critical.”&nbsp;Brian Thome, CEO of Edeniq, outlines a few key, big-picture takeaways. First, a producer needs to understand that sorghum contains more cellulosic mass that can be converted into cellulosic ethanol. Adding more sorghum may increase cellulose converted fraction, but won’t necessarily increase cellulose ethanol fraction. Second, understanding the corn/sorghum blend ratios allows producers to tailor their ratios.&nbsp;“It gives plants flexibility to look at their own economic conditions,” Thome says. “They can get higher cellulosic yields when it’s appropriate for them to do that.”In 2026, D3 RINs are valued above $2 each. Traditional D6 RINs for corn-based ethanol are $.80 to $1.Venter adds that in some cases, it comes down to the cost of corn and milo. Through April this year, the USDA’s National Weekly Grain Co-Products Report showed that ethanol plants were paying roughly $4.38 to $4.50 per bushel of corn. July bid projections are roughly the same.&nbsp;For sorghum bushels, the USDA’s projections show that ethanol plants were paying roughly $3.60 to $3.70 per bushel with some bids in Texas fluctuating between $3.06 and $3.91.&nbsp;U.S. Energy Information Administration data shows that in 2025, roughly one bushel of corn or sorghum can create just over three gallons of D6 ethanol. The percentage of cellulosic ethanol created through stover, corn kernel fiber or other means is at a much lower conversion percentage than traditional D6 ethanol production.&nbsp;Venter also says the results of the broad report should be used as a guideline. Individual plants should conduct their own study if they really want to optimize a corn/sorghum mix to generate more D3 RINs. The ethanol titer for the mixes can also be slightly lower than normal, Venter says.&nbsp;The lab teams at IFF and Edeniq, along with the sorghum producers, are happy about the results. They believe they prove out what has long been known about sorghum and corn mixes.&nbsp;But DeMartini seconds Venter’s sentiment about the need for custom analysis. Studies could be performed for each plant using their specific variables like liquefacts, enzymes and others to dial in the best ratio blend for D3s. “With converted fractions and D3 RINs, very small changes can make a big difference,” she says.Key Takeaways, Impact&nbsp; While the lab researchers are focused on new studies and finding more answers, Duff and Thome offer a high-level view of the work’s impact on the ethanol industry.&nbsp;“I think the idea for this work was a really good one,” Thome says, adding that the study shows additional opportunities for different feedstock usage under varying economic conditions. “It really comes down to what’s best for the plants. This report gives them more flexibility.”&nbsp;Duff believes the work confirms assumptions the industry has held for some time, in addition to providing more certainty about sorghum than ever before. Producers using sorghum already know that the fiber content is higher, so for D3 RIN production there is “more bang for the buck,” Duff explains.&nbsp;Blending sorghum and corn doesn’t require a big change on the enzyme cocktail side. And, sorghum can be stored next to other corn piles. Duff points to more than 10 plants across Kansas and Texas that have been running sorghum feedstock for more than a decade with no issues. Plants in South Dakota, Nebraska and Missouri also have an opportunity to utilize more sorghum than they already do, he says.&nbsp;The results of this study have opened a lot of doors and eyes to the possibility of using sorghum mixed with corn to generate higher volumes of D3 RINs, Duff says.&nbsp;“We’ve had a lot of good questions and conversations with ethanol plants,” he says. “They need to not be wrong.”&nbsp;In the end, the value of the collaborative work by IFF, Edeniq, ethanol producers and sorghum growers is about opportunity, Duff says. Author: Luke Geiver&nbsp;&nbsp; writer@bbiinternational.com&nbsp;

2026-05-27 - The Perfect Combination (Ethanol Producer Magazine)

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A recent study on the optimal blend ratio of corn and sorghum to produce D3 cellulosic RINS offers confirmation and new insight. 

The Perfect Combination

Over the past 10 years, California’s annual E85 volumes sold have increased by more than 600%. In 2015, the total volume purchased in the state was about 15 million gallons. In 2025, consumers bought 110 million gallons (118 million gallons in 2023). Since 2022, Californians have averaged purchasing just under 112 million E85 gallons annually.&nbsp;The sharp rise of E85 usage can be directly linked to fuel providers like Pearson Fuels. The San Diego-based company announced in late April the opening of its 500th E85 fueling station. In total, the state has roughly 625 E85 pump locations. &nbsp;“With some retail gasoline above $6 a gallon right now, E85 is providing significant savings to drivers,” says Doug Vind, managing member of Pearson Fuels, following the installation of fueling station 500.&nbsp;At the time of Pearson’s announcement, E85 was selling for $2.50 per gallon less than gasoline. The lower price has always been a staple for justifying the use of the fuel, and that cost advantage has helped Pearson expand access to ethanol’s highest U.S. blend. &nbsp;But growing E85 is only part of California’s continued ethanol evolution. In 2026, expanding ethanol use in the Golden State is also about technology—getting E85 conversion kits approved for use; persistence—navigating the final bureaucratic obstacles to E15 implementation; and adherence—finding creative ways to comply with the California Air Resources Board’s new feedstock sustainability requirements for ethanol coming into the state.E85 Conversion Kits&nbsp; According to the California Fuels and Convenience Alliance, California is the only state that doesn’t allow drivers to install kits enabling standard gasoline engines to run on E85. Despite CARB’s acknowledgement that such kits could provide savings to drivers, the state agency has not allowed the technology’s use. Pearson and California Assemblymember Rhodesia Ransom are working to rectify that.In February, Ransom introduced AB 2046, legislation, aimed at giving consumers access to affordable gas by allowing them to legally install federally approved E85 conversion kits. At press time in late May, the bill had advanced through the state assembly and was awaiting action in the senate. &nbsp;&nbsp;Elizabeth Graham, CFCA CEO, says the legislation would ease one aspect of California’s affordability crisis as rising fuel costs continue to strain families and businesses.&nbsp;The CFCA has been vocal about the impact of the Iran conflict on fuel supply and high gas prices, in a state that is highly susceptible to international oil price volatility. “California is particularly exposed to global market swings because more than 75% of the crude oil refined in the state is imported,” Graham says.&nbsp;That exposure to global oil supply fluctuations doesn’t only impact California. California refineries supply nearly 45% of Arizona’s transportation fuels and almost 90% of Nevada’s. A combination of decreased refining capacity in the state along with stricter, more expensive fuel blending requirements in California, highlight the immediate need for a more resilient fuel supply, according to CFCA.&nbsp;“By becoming more fuel independent, increasing domestic supply and strengthening local infrastructure, California would be less vulnerable to geopolitical conflicts and the price increases they can trigger,” Graham says, adding that E85 conversion kits should be part of the solution.The E85 kits work by reading the ethanol content of the fuel in real time and sending adjusted signals to the vehicle’s fuel injectors, according to Pearson. The technology allows the engine to optimize fuel delivery. &nbsp;“One of the most common misconceptions is that higher ethanol blends damage engines,” the company states. “Modern vehicles are already built with materials compatible with ethanol. The limitation isn’t the hardware—it’s that the engine’s software isn’t designed to adjust to higher ethanol content without guidance. That’s exactly what the conversion kit provides.”E15 Implementation&nbsp; Despite the October 2025 passage of year-round E15 blending, Californians are still waiting for their chance to fill up with E15 blends, as CARB works through the implementation process. The primary issue is that CARB has not certified the proper vapor recovery equipment for use with E15.“California is still facing a key barrier when it comes to E15,” Graham says. “Until that certification is addressed, it remains a significant hurdle to introducing E15 into the market. That said, if we’re able to resolve this obstacle, we could see E15 enter the California market relatively quickly.”&nbsp;According to CARB, most vapor recovery systems need to be certified for use with E15, as the equipment was manufactured for use with E10. CARB also says that before it can provide these certifications, state law requires approvals from four other state agencies: the Department of Industrial Relations (a division of Occupational Safety and Health), the Department of Forestry and Fire Prevention (State Fire Marshall), the California Department of Food and Agriculture (a division of Measurement Standards) and the State Water Resources Control Board.&nbsp;The rollout of E15 could increase the state’s market potential for overall ethanol gallons consumed by 50%. Like E85, E15 offers a discount to regular unleaded/E10 blends. E15ForCA.com, a site sponsored by the Renewable Fuels Association that tracks the progress of E15, notes that E15 is roughly 8% cheaper than regular unleaded/E10.Sustainability Requirements&nbsp;&nbsp; Producers looking to supply California with ethanol for any blend level will need to understand new feedstock sustainability requirements. Under the revamped Low Carbon Fuel Standard, CARB is now calling on producers to report the point of origin for their feedstocks, along with a number of other LCFS changes adopted this year.&nbsp;According to CARB, beginning with the 2026 data year submitted in 2027, holders of pathways utilizing biomass must maintain attestations showing when the biomass was planted, contracted and harvested after July 1, 2025. Geographical shapefiles or the coordinates of plot boundaries must be provided to CARB to show the physical location of the biomass used to produce renewable fuel supplied to the LCFS program.The point-of-origin requirement was debated for several months prior to implementation by CARB. The RFA and Growth Energy both expressed opposition. The phase-in timeline for the full set of requirements for crops like corn, soybean or other feedstocks will culminate in 2031. This year, the main requirement for producers is the supply of geographical shapefiles or coordinates. From 2026 on, producers will need to maintain that information and provide it to CARB as necessary.&nbsp;In an April webinar, CARB provided clarity on the new point-of-origin requirements. Carmen Meiaula, air pollution specialist for CARB, said the agency is evaluating multiple strategies that would allow producers to show plot boundaries, including satellite imagery.&nbsp;During the Q&amp;A portion of the webinar, a participant asked if plants outside of California need to record and account for all of the feedstock used at a given biorefinery, or only the amount of feedstock used to produce fuel supplied to California. For example, if a plant produces 100 million gallons of renewable fuel per year but only supplies 1 million gallons of that fuel to California, does 100% of the feedstock used at the plant need to be accounted for and shown to meet the requirements of the LCFS sustainability metrics?&nbsp;A CARB representative said only the feedstock used to produce the fuel supplied to California would need to be accounted for with point-of-origin requirements for sustainability. CARB is using a mass balance approach for reporting, so the feedstock used at the plant for California would not have to be stored separately or treated differently. A follow-up question from the same participant centered on corn kernel fiber and its requirements. According to CARB, CKF is not subject to sustainability requirements under new LCFS point-of-origin policy.&nbsp;Policy of any sort will remain the focal point of CFCA, Graham says, regardless of its link to E85 kits, vapor recovery systems or point-of-origin shapefiles.&nbsp;“In 2026, one of the most important things to highlight is the continued role ethanol can play in improving fuel affordability and expanding consumer choice in California,” she says. “At a time when fuel prices remain a major concern, ethanol blends like E85 represent a practical, lower-cost, lower carbon-emission solution.&nbsp;“California continues to face unique regulatory barriers that limit access to these fuels, and addressing those challenges is key to unlocking their full potential.” Author: Luke Geiver&nbsp;&nbsp; writer@bbiinternational.com&nbsp;

2026-05-27 - California's Ethanol Opportunity (Ethanol Producer Magazine)

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E85 conversion kits, E15 vapor recovery system certifications and new sustainability requirements are all key to growing ethanol use in the Golden State. 

California's Ethanol Opportunity

The ethanol industry has always been adaptive, responding to new policies, market signals and technology pathways. Today, producers are capitalizing on near-term opportunities, such as the 45Z Clean Fuel Production Credit, to capture value and improve margins in a favorable policy environment. But beneath that momentum, a more structural shift is underway, one that could redefine competitiveness in low-carbon fuel markets over the next decade. The message is simple: what earns credits today may earn deficits tomorrow.A Changing Compliance Curve&nbsp; Low-carbon fuel programs, particularly in California, are designed to reduce fuel carbon intensity (CI) over time. The compliance curve, the benchmark that decides whether fuels generate credits or deficits, declines each year, increasing stringency. At present, many ethanol pathways remain comfortably below the 2026 compliance threshold of 24.2% reduction, allowing them to generate credits and support favorable economics. However, recent data indicates that the margin is narrowing. As compliance increases, the stringency aims for a 52.5% reduction by 2035, doubling the reduction planned for 2026.&nbsp;CI targets for 2028 and beyond may be accelerated by the Automatic Acceleration Mechanism pursuant to section 95484(b).&nbsp;For example, average CI scores for ethanol in Q3 2025 averaged at 58.59 &nbsp;gCO2e/MJ, and by 2035, a CI score above 47.09 gCO2e/MJ for gasoline and 50.23 gCO2e/MJ for diesel curves will result in earning deficits. This is not a distant or hypothetical shift. It is built into the program’s structure and requires a regulation change to modify. As the benchmark declines, fuels that once generated credits will eventually fall below the line, resulting in deficits rather than revenue.From Credit Generation to Deficit Risk&nbsp; This shift will significantly alter market dynamics. Currently, ethanol producers base their strategic choices on existing credit values and logistics. Sometimes, they have withdrawn from markets such as California due to transportation expenses and compliance requirements that outweigh credit earnings. But as the compliance curve tightens, demand will increasingly favor the lowest-CI fuels available. Regulated parties—those responsible for meeting carbon targets—will prioritize ethanol with the lowest possible CI scores to avoid deficit exposure.This shift establishes a new reality: lower CI ethanol gains increased value, while higher CI ethanol becomes less competitive, yet remains somewhat competitive compared to gasoline. As compliance requirements tighten, credit prices are expected to rise. Essentially, the market will favor early preparers and penalize those who delay.The Limitations of Short-Term Thinking&nbsp; The current focus on 45Z is understandable. It offers immediate financial upside and has become a central part of strategic planning for many producers. However, 45Z alone is not a long-term strategy. Facilities that optimize solely for near-term incentives risk missing the broader trajectory of carbon markets. Investments made today can capture current value while also positioning facilities to meet compliance thresholds over the next five to 10 years. The most competitive producers are already defining long-term CI targets and aligning their operations with those goals.Pathways to Lower Carbon Intensity&nbsp; Lowering CI is not a single decision; it is a portfolio of operational and strategic improvements. Many producers have already taken initial steps, but further reductions will be necessary to remain competitive. Key areas to assess include energy and utilities optimization. Cutting down natural gas and electricity use or switching to lower-carbon energy sources can lead to significant CI reductions. Renewable energy integration through behind-the-meter solutions like renewable natural gas (RNG) or on-site solar can greatly enhance carbon performance.&nbsp;Process improvements and efficiency gains, such as converting corn kernel fiber into cellulosic ethanol, can reduce CI while creating additional value streams. Assessing the carbon intensity of inputs, including chemicals and upstream processes, can provide incremental benefits. Although extensively studied, carbon capture and sequestration (CCS) remains a key option where feasible. While these steps may seem incremental individually, collectively they can determine whether a facility remains competitive in a tightening market.While these strategies are widely understood, the challenge for many producers is not identifying potential improvements but determining where to begin and how to prioritize investments. Each facility operates within unique constraints, including access to feedstocks, energy infrastructure, capital availability and regional market dynamics. As a result, there is no single pathway to achieving lower carbon intensity. Instead, producers must evaluate a combination of options and consider how incremental improvements compound over time.In many cases, early-stage feasibility assessments can reveal opportunities that are both technically achievable and economically viable, particularly when aligned with future credit market conditions. Engaging with technology providers, utilities and regulatory experts at an early stage can also help clarify timelines and avoid delays later in the process. Importantly, these conversations often uncover dependencies that may not be immediately visible, such as permitting requirements, infrastructure limitations or verification timelines, all of which can influence when a project ultimately delivers value.Planning Takes Time&nbsp; One of the most overlooked challenges in carbon markets is timing. Lowering CI is not an overnight process. It requires feasibility studies, capital investment decisions, technology partnerships, regulatory approvals and operational changes. In some cases, regulatory engagement alone—such as validating new pathways or CI adjustments—can take years. That timeline is precisely why planning must begin now. Producers who wait until the compliance curve becomes restrictive will find themselves reacting under pressure, with fewer options and higher costs.A Market Signal Producers Can’t Ignore&nbsp; The development of low-carbon fuel markets is increasingly understood as a policy certainty as regulatory frameworks continue to evolve and tighten over time. The compliance curve will continue to decline, and the standards for what qualifies as “low-carbon” will become more stringent. Additionally, the market will increasingly differentiate between producers based on their CI performance. With change already underway, the focus is shifting toward how prepared producers are to respond to evolving market conditions.The Next Phase&nbsp; The ethanol industry has consistently demonstrated its ability to innovate and adapt.&nbsp;&nbsp; The next phase of that evolution will be defined by how effectively producers manage carbon intensity across both current incentive structures and future compliance requirements. Those who take a long-term view, invest in CI reduction, evaluate new technologies and align with future compliance thresholds will be best positioned to compete. Because in the next phase of low-carbon fuel markets, the advantage will belong to those who planned ahead.In practice, this means shifting from a reactive approach to a more structured, forward-looking strategy. Producers that establish clear internal benchmarks for carbon intensity, regularly evaluate progress and revisit their assumptions as regulations evolve will be better equipped to navigate uncertainty and capture emerging opportunities in low-carbon fuel markets. Author: Chelsa Oren, Ethanol and Biodiesel Service Director,&nbsp;&nbsp; &nbsp;EcoEngineers&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;coren@ecoengineers.us

2026-05-27 - The Next Phase of Low-Carbon Fuel Markets (Ethanol Producer Magazine)

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To capture future opportunities, producers must plan for ever-changing compliance requirements.

The Next Phase of Low-Carbon Fuel Markets

Ethanol has long been an anchor commodity for the U.S. freight rail network, connecting production facilities in the Midwest with fuel markets across the country. Today, new federal incentives and emerging technologies are creating additional opportunities for rail to support the next phase of growth in the biofuels sector.The Inflation Reduction Act introduced the Section 45Z Clean Fuel Production Credit, a policy designed to accelerate the production of low-carbon fuels. As producers adapt operations to qualify for the credit, the broader ecosystem around ethanol production including feedstocks, renewable fuels and carbon management may drive new transportation demand.Freight rail is positioned to support that expansion.Ethanol’s Role in the Rail Network&nbsp; Ethanol has become one of the most important renewable energy commodities transported by rail. According to the Association of American Railroads (AAR), railroads account for roughly 60% to 70% of ethanol transportation in the U.S.The growth of ethanol rail shipments accelerated after methyl tert-butyl ether (MTBE) was phased out two decades ago. Ethanol quickly replaced MTBE in fuel blending. Because of ethanol’s alcohol content, it cannot be transported through conventional petroleum pipelines. As a result, railroads became the primary transportation mode capable of moving large volumes.For ethanol producers evaluating rail transportation, equipment specifications and tank car design play an important role in operational planning. Manufacturers such as The Greenbrier Companies offer tank car guides and technical resources that help producers better understand equipment options and capacities.These resources also explain commodity applications, supporting the safe and efficient movement of ethanol and other liquid energy products across the rail network.Tank car design plays a central role in safely transporting ethanol from production facilities to fuel markets.Ethanol production is concentrated across the Midwest. However, many of the largest consumption markets are located along the East Coast, California and Texas. Rail provides the long-distance connectivity needed. Short lines and regional railroads also play an important role. The AAR estimates that 15% to 20% of ethanol rail movements originate on short-line networks.Rail’s Efficiency Advantage&nbsp; Freight rail remains one of the most fuel-efficient transportation options available for moving bulk commodities. The Federal Railroad Administration reports that railroads can move one ton of freight nearly 500 miles on a single gallon of fuel.This efficiency advantage has made rail the preferred mode for moving large volumes of energy products such as crude oil, coal and ethanol.For ethanol producers, rail offers both scale and flexibility. Large unit trains can move product efficiently to major markets, while rail’s national network allows producers to reach multiple blending terminals and storage hubs across the country.As the biofuels sector expands, that flexibility will become even more valuable.The 45Z Clean Fuel Production Credit&nbsp; The Section 45Z Clean Fuel Production Credit was established to encourage the domestic production of fuels that produce fewer greenhouse gas emissions than conventional petroleum-based fuels. Unlike previous incentives, the credit focuses on carbon intensity.The credit applies to fuel produced after Dec. 31, 2024 and has been extended through 2029. According to projections from the U.S. Department of Agriculture, roughly 35% of U.S. corn production is expected to be used for ethanol in 2025, highlighting the continued importance of renewable fuels to agricultural markets.As production is expected to increase, railroads are in position to handle the additional capacity needed to transport the fuel safely.Carbon Capture and New Rail Demand&nbsp; While ethanol itself remains a critical commodity, the next phase of rail growth tied to ethanol production may come from the broader infrastructure surrounding biofuel facilities.As producers work to lower their CI scores under the 45Z framework, carbon capture and sequestration (CCS) is emerging as a key strategy.Ethanol plants produce high-purity carbon dioxide during fermentation, making them attractive candidates for carbon capture projects. Captured CO2 can then be transported to sequestration hubs where it is permanently stored underground.While pipelines are one option for moving captured CO2, rail provides a flexible and deployable solution, particularly in regions where pipeline infrastructure does not yet exist.Some industry initiatives are already exploring rail-based carbon logistics networks capable of connecting ethanol plants to sequestration hubs. In many cases, these solutions are designed to serve ethanol facilities located far from proposed pipeline routes.For those producers, rail can offer a near-term pathway to carbon management while pipeline infrastructure continues to develop.Rail Equipment Solutions for a Changing Energy Market&nbsp; The evolving biofuels landscape is expected to generate transportation demand across multiple commodities beyond ethanol itself.Renewable diesel (RD), sustainable aviation fuel (SAF) and feedstocks used in biofuel production all require reliable transportation networks capable of moving liquids and bulk materials efficiently.Rail equipment manufacturers are developing specialized tank car solutions designed to safely transport a range of energy products, including ethanol, renewable fuels and captured carbon dioxide.The Greenbrier Companies manufactures tank cars designed to transport commodities such as ethanol, renewable fuels and pressurized carbon dioxide, including a 22,000-gallon CO2 tank car developed for carbon capture and sequestration supply chains.By supporting the transportation of ethanol, renewable fuels and captured carbon, rail equipment manufacturers can help enable the broader infrastructure needed to support low-carbon fuel production.Rail’s Expanding Role in the Energy Transition&nbsp; Ethanol will likely remain a foundational commodity for the freight rail industry. However, new policies such as the 45Z Clean Fuel Production Credit are reshaping the broader ecosystem around ethanol production.As producers pursue lower carbon intensity fuels, demand for transportation of feedstocks, renewable fuels and captured carbon dioxide is expected to grow. Rail provides an infrastructure capable of supporting both today’s fuel supply chains and the emerging low-carbon fuel economy.Freight rail’s ability to move large volumes efficiently, reach rural production regions and connect to national fuel markets positions it as a key transportation solution for this evolving energy landscape.Author: The Greenbrier Companies&nbsp; info@gbrx.com

2026-05-27 - Rail Positioned to Support the Next Phase of Ethanol Growth  (Ethanol Producer Magazine)

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New federal incentives and emerging carbon management strategies are expanding the role of freight rail beyond ethanol to support the broader low-carbon fuels supply chain.

Rail Positioned to Support the Next Phase of Ethanol Growth 

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July 2026

July 2026

Columns

Focused On Potential

E15 Proves It: Bipartisanship Is Not Dead

Is Europe Changing Its Mind On Biofuels (Again)?

Featured

Innovation Underway

On Board With Maritime Policy

Strong Market Signals

The Perfect Combination

California's Ethanol Opportunity

Contributions

SPOTLIGHT | NOVONESIS: Fast & Furious: Throughput and the Biosolutions for Success

The Next Phase of Low-Carbon Fuel Markets

Rail Positioned to Support the Next Phase of Ethanol Growth

July 2026.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Columns

Focused On Potential

E15 Proves It: Bipartisanship Is Not Dead

Is Europe Changing Its Mind On Biofuels (Again)?

Featured

Innovation Underway

On Board With Maritime Policy

Strong Market Signals

The Perfect Combination

California's Ethanol Opportunity

Contributions

SPOTLIGHT | NOVONESIS: Fast & Furious: Throughput and the Biosolutions for Success

The Next Phase of Low-Carbon Fuel Markets

Rail Positioned to Support the Next Phase of Ethanol Growth

July 2026