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Iowa Renewable Fuel Plant Closes Without Government Mandated Market
Hotair ^
| 09/26/2019
| Jazz Shaw
Posted on 09/26/2019 10:05:29 AM PDT by SeekAndFind
Some more news out of Iowa on the King Corn front reached us this week and it spells yet another headache for President Trump who remains caught in a tug-of-war between the ethanol lobby and the oil and gas industry. The CEO of W2 Fuel, a biofuel company, announced that he is closing his plant in Crawfordsville and laying off the fifty employees who work there. The reason he is giving for the closure is that the Renewable Fuel Standard waivers given to more than thirty small refineries by Trump’s EPA this year (85 total since taking office) have reduced demand for ethanol and the market won’t sustain his operations. (Des Moines Register)
An Iowa biodiesel plant announced Tuesday it’s shutting down as Gov. Kim Reynolds warned that federal waivers exempting oil companies from using renewable fuels are hurting the state’s rural economy.
“We continue to see farmers that are impacted,” Reynolds said at a weekly meeting with reporters. “We continue to see ethanol plants that are being idled…
Roy Strom, CEO of W2 Fuel, said Tuesday he is closing the company’s 10-million gallon biodiesel plant in Crawfordsville in southeast Iowa, along with a plant in Michigan, given growing losses.
Ray Strom is a businessman in the private sector so I’m happy to take him at his word. If he has calculated that there isn’t enough demand for his ethanol to keep his business profitable, then shutting down (at least temporarily) was no doubt his only option.
He’s blaming the EPA (and President Trump’s policies) for the closure of his plant. And in at least one regard, he has a valid complaint, but he’s looking at the wrong president. If Strom wants to blame someone, he should take it up with George W. Bush, because that’s the guy who put the RFS into place originally and created this situation.
Strom is angry about the reduction in market demand for his ethanol. But what he’s failing to admit is that there was never a real demand for the amount of ethanol that’s being produced in the midwest to begin with. There’s certainly a market for some ethanol, but nowhere near the amounts that are currently being pumped out. W2 Fuel and its competitors have been growing wealthy by selling a product to oil refineries that they neither want nor need.
The RFS created an artificial market demand for ethanol that wouldn’t exist without the government holding a gun to the heads of the refineries and forcing them to blend this poor quality fuel into the nation’s gasoline supply. Failing to do that means they either have to buy ruinously expensive Renewable Identification Number (RIN) credits or face massive government fines.
The government offering waivers to older, smaller refineries that aren’t set up to blend ethanol in the mandated quantities was a charitable act intended to save them from bankruptcy. But that same benefit should be offered to all refineries by doing away with the RFS entirely. Will that hurt the ethanol plants like Mr. Stroms? Yes, it will. But they were never operating on a fair playing field to begin with. The RFS distorted the free market in obscene ways, and now that meddling is coming back to haunt any number of people.
TOPICS: Business/Economy; Culture/Society; News/Current Events; US: Iowa
KEYWORDS: automotive; biofuel; energy; ethanol; iowa
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To: SeekAndFind
2
posted on
09/26/2019 10:10:52 AM PDT
by
fireman15
To: SeekAndFind
Markets should determine winners and losers, not government mandate. Let the political chips fall where they may.
3
posted on
09/26/2019 10:11:01 AM PDT
by
buckalfa
(The best two years of my life were spent in the third grade.)
To: SeekAndFind
Biodiesel isnt commercially viable with todays oil prices. Ethanol really isnt either, but it comes much closer than biodiesel.
The government mandated market made money for ethanol producers in early, but I dont think any biodiesel production made money even with government mandates, except for researchers and selling to the Defense Dept, etc.
4
posted on
09/26/2019 10:12:59 AM PDT
by
jjotto
(Next week, BOOM!, for sure!)
To: SeekAndFind
Next, the damn windmills.
5
posted on
09/26/2019 10:14:15 AM PDT
by
CrazyIvan
(The Democrat party. A collaboration of Cloward-Piven and Dunning-Kruger.)
To: SeekAndFind
It appears Jazz Shaw has no idea that biodiesel isnt the same thing as ethanol!
6
posted on
09/26/2019 10:14:42 AM PDT
by
jjotto
(Next week, BOOM!, for sure!)
To: SeekAndFind
Roy Strom, CEO of W2 Fuel, said Tuesday he is closing the companys 10-million gallon biodiesel plant in Crawfordsville in southeast Iowa, along with a plant in Michigan, given growing losses.Good. If you have to take my tax dollars to run your business, and the tax dollars stop, start a different business or get a yob.
7
posted on
09/26/2019 10:14:58 AM PDT
by
USS Alaska
(Nuke the terrorist mooselimb savages, today.)
To: SeekAndFind
Hi.
They could have made whiskey.
5.56mm
8
posted on
09/26/2019 10:16:02 AM PDT
by
M Kehoe
(DRAIN THE SWAMP! BUILD THE WALL!)
To: SeekAndFind
9
posted on
09/26/2019 10:18:23 AM PDT
by
G Larry
(There is no great virtue in bargaining with the Devil)
To: SeekAndFind
How is this a headache for PDJT?
10
posted on
09/26/2019 10:20:34 AM PDT
by
Steely Tom
([Seth Rich] == [the Democrat's John Dean])
To: SeekAndFind
We were traveling through Iowa a couple of months ago and noticed that all of the gas stations were pushing ethanol. Several options were available; different grades. Not surprising considering the corn fields were endless.
I forgot to check the price. But price, of course, is misleading because ethanol is subsidized.
11
posted on
09/26/2019 10:26:59 AM PDT
by
dhs12345
To: SeekAndFind
Greta should send her death stares at the ethanol lobby. Double whammy. They’re depriving starving children around the world of corn and providing fuel to evil SUVs.
12
posted on
09/26/2019 10:27:15 AM PDT
by
bgill
To: SeekAndFind
We continue to see farmers that are impacted, Reynolds said at a weekly meeting with reporters. We continue to see ethanol plants that are being idled
<<<
The 1st farmers that discovers corn can be eaten or crop rotation should make out all right......./s
also on a side note....ethanol free gas will save BILLIONS in small engine repairs and destruction!
also..we must remember that “ethanol” came about by another great Government “Proven Science” boondoggle...Peak Oil...
13
posted on
09/26/2019 10:29:33 AM PDT
by
M-cubed
To: M-cubed
“The 1st farmers that discovers corn can be eaten..”
Ha, that’s what I thought. Let corn be corn! Problem solved.
14
posted on
09/26/2019 10:34:09 AM PDT
by
Cedar
To: SeekAndFind
There’s overcapacity because of incentives given in the past (Obama), this is how free markets should work. Smaller plants are especially inefficient but when it’s free money, who cares?
15
posted on
09/26/2019 10:51:07 AM PDT
by
bigbob
(Trust Trump. Trust the Plan.)
To: SeekAndFind
My old tractor wants 93 octane and I can’t find it anywhere. Nearest is 91.
To: SeekAndFind
Wish that I was on ol’ Rocky Top
Down in the Tennessee hills
Ain’t no smoggy smoke on Rocky Top
Ain’t no telephone bills
...
Corn won’t grow at all on Rocky Top
Dirt’s too rocky by far
That’s why all the folks on Rocky Top
Get their corn from a jar.
To: SeekAndFind
Making fuel from food is pure folly. A 25 gallon tank of pure ethanol requires 450 pounds of corn to produce. This equates to roughly the number of calories to feed someone for a year.
Also, the amount of energy required to plant, plow,irrigate and harvest the corn and process it into ethanol is almost exactly equal to the energy in that same ethanol. There is no net gain in available energy.
Without taxpayer subsidy, ethanol is a looser. It amounts to welfare for farmers and the producers of the ethanol. It represents a cost to consumers. When ethanol was approved as an additive to gasoline one of the selling points was it helped make the U. S. less dependent on Arab oil sources.
Fraking has now enabled us to not only be energy independent, but the largest oil and natural gas producers in the world. We now export both crude oil and natural gas. We have no real need for ethanol at all and the misery that it causes for every small engine owner.
18
posted on
09/26/2019 11:20:12 AM PDT
by
Saltmeat
To: SeekAndFind
Ethanol bad, Butanol good.
Butanol is much closer to gasoline for BTU content and hydro affiliation. It can also be made from non-editable stocks.
19
posted on
09/26/2019 11:23:32 AM PDT
by
taxcontrol
(Stupid should hurt - dad's wisdom)
To: SeekAndFind
Well, Bye.
This junk fuel was born sometime in the energy crisis, died in the mid-80s, was reborn about 15 years later by little George probably just pandering to money at ADM et al and then is being rightfully killed once again by Magnus Trump.
Anybody that invests in an artificial, regulation borne or tax supported business should eventually get what he deserves, a burn down.
Coal Bed Methane was another crock of crap that was only viable with tax incentives. Some things the gubment should just stay out of. Politicians can’t help themselves though when there is lobby money at stake.
I will be very, very happy when the last ethanol plant closes. Almost all of us will be much better off.
20
posted on
09/26/2019 11:27:57 AM PDT
by
Sequoyah101
(We are governed by the consent of the governed and we are fools for allowing it.)
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