|
|
|
|
|
By Kenneth Dierschke
Texas Farm Bureau President
Texas is an oil and gas state that will never embrace renewable fuels, right? Wrong.
An ethanol plant is under construction in Dumas. Panhandle Energies of Dumas, LP will take corn and grain sorghum and turn it into 30 million gallons of ethanol each year.
They're not the only ones who have decided the time is right to join the renewable fuels revolution.
In fact, two more companies have announced plans in recent months to build 100 million gallon ethanol plants in the Panhandle. When they're up and operating by the end of next year, Texas will join the ranks of Midwestern states like Iowa and Illinois and take its rightful place among the nation's leading ethanol producers.
Ethanol might have gotten its start in the Midwest but use of the clean burning, renewable gasoline additive has exploded across the country. When the State of California banned MTBE and switched to ethanol, it created the nation's biggest ethanol market and new opportunities for the industry. It wasn't long before several northeastern states followed suit.
Today ethanol is so prevalent that a study prepared for the Renewable Fuels Association by economist John Urbanchuk estimates that 30 percent of all gasoline used in the United States last year was blended with ethanol.
Lately, wholesale ethanol prices have dropped below wholesale gasoline prices. The Consumer Federation of America announced in May that if oil companies chose to blend more ethanol with gasoline, Americans would save as much as eight cents per gallon of gas.
In 2001, when Congress began debating the nation's energy policy, annual ethanol output was about 1.5 billion gallons. By the end of this year, the nation will produce nearly 4 billion gallons with a majority of the new production capacity coming from farmer-owned plants.
If Congress finally gets around to passing a comprehensive energy bill this summer, a renewable fuels provision in the Senate bill will double ethanol production to 8 billion gallons by 2012, creating a stable footing for the industry. That's 8 billion gallons of gasoline that won't need to come from the Middle East.
There's outstanding growth potential for this industry, not just in the corn-belt Midwest, but deep in the heart of Texas.
In fact, the Texas ethanol production model leverages the strength of our state's leading agricultural sector. Currently, Illinois farmers are sending corn by the trainload to Texas cattle feedlots. Once the Texas-sized ethanol plants are in production, instead of simply feeding the "imported" Illinois corn, these facilities will take that corn and add value to it, by converting it into gasoline additive and dried distillers' grain—an inexpensive cattle feed.
Ethanol will produce another by-product, jobs. White Energy Hereford, LLC of Dallas says in addition to $100 million invested in the first year of construction, their plant will provide 38 full time jobs and support an additional 650 others in a community of 14,525. The Dumas plant will employ 36, with an annual payroll of $1.3 million in that community of 13,700.
A gallon of ethanol is selling for less on the wholesale market than a gallon of regular unleaded. Unfortunately, the only opportunity for Texans to buy ethanol blended products is in El Paso. Texas motorists are paying too much to fill their tanks. The time is right for an energy bill that secures a future for ethanol, and provides an economically viable fuel for America.
