ACE leadership draws upon fuel retailing experience and input from marketers to inform USDA on HBIIP implementation
Posted on 01/30/2020
Sioux Falls, SD (January 30, 2020) – Today, the American Coalition for Ethanol (ACE) submitted comments in response to the United States Department of Agriculture (USDA) request for information (RFI) on a Higher Blends Infrastructure Incentive Program (HBIIP). The USDA is exploring options to expand domestic ethanol and biodiesel availability and is seeking information on opportunities to consider infrastructure projects to facilitate increased sales of higher biofuel blends (E15 or higher). According to USDA, this effort will build on biofuels infrastructure investments and experience gained through the Biofuels Infrastructure Partnership (BIP). With over 40 years of petroleum wholesale distributing, convenience store marketing and operations experience, and involvement educating fuel retailers about ethanol, ACE Senior Vice President and Market Development Director Ron Lamberty participated in USDA’s stakeholder meeting to discuss a HBIIP program and provide insight on how the program should be implemented to create a larger market for ethanol at a low cost per gallon over the long-term.
Among other suggestions, ACE made the following recommendations that USDA should consider in the final HBIIP to expand the geographical availability of higher blends and encourage more widespread participation by small retailers:
- Incentivize the highest number of locations available over the widest geography possible, and provide incentives to wholesale blending facilities, as having “RINless” ethanol or E85 available outside of fuel terminals has been the single most important factor in areas where significant volumes of higher ethanol blends are being sold.
- Any equipment used to store, blend, and dispense higher blends of ethanol should be eligible under the program.
- Provide a combination of grants and high percentage direct cost share for the purchase of equipment, retrofitting, enhancements, and other expenditures that will encourage retailers to investigate whether they can sell E15 and higher ethanol blends, particularly to pique the interest of “mom and pop” c-stores and assure them they can afford to add E15 and participate in the program.
- All equipment funded by the program — whether new or converted — must be compatible with the fuel offered, as verified by an equipment installer licensed by the authority having jurisdiction in the station’s area.
“Following the November USDA meeting, we talked to some of the small retailers and groups who adamantly opposed E15 and didn’t like the first BIP program to find out what they would like to see in a new program,” Lamberty said. “As expected, the main objections to adding E15 to their fuel product slate were beliefs E15 isn’t compatible with existing equipment, new infrastructure is too expensive, and only big convenience store chains can afford to offer it.”