Recently reported by Reuters, late last month the U.S. ethanol and corn industries criticized an advisory board to the U.S. Environmental Protection Agency for a draft report which found there could be little to no climate benefit to using corn-starch ethanol as a fuel, compared with gasoline. I found that report, which noted:
“The SAB finds that resolving the scientific question of whether use of corn starch ethanol as a fuel reduces GHG emissions or not, relative to gasoline and diesel, is absolutely central to determining whether the EPA is implementing and enforcing a RFS that has net climate benefits, neutral climate impacts, or even net climate damages. There is a vigorous scientific debate about the climate benefits from substituting corn ethanol for gasoline or diesel. Therefore, the SAB recommends that the EPA further evaluate the role the RFS plays in reducing GHG emissions. Future rulemakings that set volume requirements for renewable fuels should more directly address the scientific question of whether corn starch ethanol has lifecycle GHG emissions no higher than 80% of those of gasoline and diesel.”
The lack of consensus on the real contribution of ethanol to GHG emissions, and the issue of indirect land use change (ILUC), has had a real impact on the industry and it’s been difficult for the industry to counter even with its own vigorous advocacy and studies from recognized experts (including this firm). The Renewable Fuels Association (RFA), one of the trade groups representing the industry, noted in response that:
“We adamantly disagree with the SAB’s assertion that ‘the best available science’ suggests there are ‘minimal climate benefits’ associated with using corn ethanol in place of gasoline. Indeed, the best available science shows just the opposite. Extensive research conducted by government laboratories, major universities, state and federal agencies, NGOs, and private lifecycle analysis experts all demonstrates that corn ethanol is 40-50 percent less carbon intensive than petroleum on a full lifecycle basis—including emissions from hypothetical land use change scenarios.”
The question of how much GHG emission reductions can be had from ethanol was an existing issue for the light-duty fleet in the U.S., but now it may become a huge issue for sustainable aviation fuel (SAF), bleeding into that sector. For SAF and the ethanol-based alcohol-to-jet (AtJ) pathway, the issue is one of models: CORSIA* v. GREET for purposes of calculating the SAF tax credits under the IRA. The IRA states that a fuel’s GHG emissions are to be defined and certified in accordance with the life-cycle assessment (LCA) adopted by CORSIA or “any similar methodology” that satisfies criteria in the Clean Air Act.
The industry favors GREET because it is more up to date and includes credits for soil carbon management. Environmental NGOs are pressing the Administration hard for CORSIA. The difference in approaches is shown in the figure below from ICCT, one of those environmental NGOs opposing GREET. ICCT notes: “Adopting GREET as a ‘similar’ LCA methodology for SAFs in the IRA could incentivize fuel pathways with uncertain GHG reduction benefits.”
Figure 1: Life-Cycle Emissions Estimates for Corn Ethanol-to-Jet
Source: ICCT, September 2023
It’s unclear how the Administration will proceed, but a decision is expected in December from the Treasury Department. There has been talk of a blend between the two models, but no details on how that would work. This week U.S. airlines and aviation companies joined the ethanol industry in advocating for GREET in a letter to Treasury Secretary Janet Yellen.
I said recently that I would be covering some of the “wrinkles” for SAF for Transport Energy Outlook members – this is one of them. If the Administration adopts CORSIA, it will be, if not impossible, very difficult and costly for ethanol AtJ pathway to achieve the 50% GHG reduction threshold required under the IRA. If the Administration adopts GREET, that opens the door for ethanol AtJ scale up, but it will not be an easy glide path.
Members can read more recent research on SAF at this link.
*The International Civil Aviation Organization (ICAO)’s Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA)
