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Published February 28, 2014, 09:00 AM

Vilsack makes promises to ethanol industry

Agriculture Secretary Tom Vilsack said in Phoenix Feb. 27 that even though Congress has said he can’t use one U.S. Department of Agriculture program to subsidize blender pumps, he will use a wide array of other programs to help the ethanol industry, as well as promote ethanol exports for the first time and express his views on the Renewable Fuel Standard to the Environmental Protection Agency and the White House.

By: Jerry Hagstrom, Agweek

PHOENIX, Ariz. — Agriculture Secretary Tom Vilsack said in Phoenix Feb. 27 that even though Congress has said he can’t use one U.S. Department of Agriculture program to subsidize blender pumps, he will use a wide array of other programs to help the ethanol industry, as well as promote ethanol exports for the first time and express his views on the Renewable Fuel Standard to the Environmental Protection Agency and the White House.

Vilsack, a former Iowa governor, told the annual leadership conference of Growth Energy, the ethanol building and management company, that he was speaking without notes and “from my heart” because “I know of no group that has more of the national interest at heart than the folks who are here today” or others in the renewable fuels industry.

“There’s the elephant in the room,” Vilsack said, referring to the RFS. “I have reached out to my colleagues at EPA and the White House to make sure they fully understand the significance of the industry.”

He added that he had personally asked EPA Administrator Gina McCarthy to read the comments that have been filed about EPA’s proposal to reduce the volumetric requirements for various types of renewable fuels in the future, compared with the expectations under the 2007 Energy Act.

Vilsack said he does not know what EPA will decide and can’t control that decision, but noted that his father-in-law, whose law practice he joined in Mount Pleasant, Iowa, taught him that “for every dote there is an antidote.”

Signaling that ethanol is at the core of his efforts to reverse the population loss in rural America, particularly among young people, and to create better jobs, Vilsack said, “You are the future of rural America, so it is up to us at USDA to do everything we can to help the industry survive, mature and expand.”

When he became Agriculture secretary, Vilsack used the Rural Energy for America Program to encourage oil companies and gas stations to install the blender pumps they need to sell ethanol, but Congress said in the new farm bill that he cannot use that program for that purpose.

But on Feb. 27, Vilsack noted that he has “a whole lot of programs” at his disposal including business and industry grant programs that have a lot of flexibility and that he intends to use those programs to encourage companies ranging from petroleum marketers to convenience stores to sell ethanol.

“This is an invitation to you to come to me and USDA will help you,” Vilsack said.

He also noted that he had worked with Senate Agriculture Committee Chairwoman Debbie Stabenow, D-Mich., to get another program in the energy title of the farm bill that will allow USDA to invest in biobased manufacturing. Not only did he get the provision, Vilsack said, he got $880 million in mandatory spending for that purpose over the five year life of the farm bill.

Vilsack later told Agweek in an interview that he does not think definitions of rural in USDA rural development programs will be a barrier in reaching consumers, even though many live in big cities.

Some USDA programs limit activities to communities of 50,000 people or less, others to communities of 20,000. Of the 954 towns in Iowa, he said, 800 have fewer than 1,000 residents.

Vilsack also invited Growth Energy to include a representative on a trade promotion trip that Agriculture Undersecretary for Farm and Foreign Agricultural Services Michael Scuse will take to China this spring.

“I want you to be there when he travels to China,” Vilsack said.

Promoting exports

USDA has used its trade promotion budget to promote exports of dried distillers grains, an ethanol byproduct used for feed, but has not promoted ethanol exports.

“Beginning now we are going to start the process of expanding that to include promotion of ethanol biofuel,” Vilsack said. “We think there are emerging markets in China, India and Japan that have been slow to embrace renewable fuels but face environmental problems. We think they are ripe for discussion.”

These plans, he said, are the reason Joe Glauber, the USDA chief economist, made higher-than-expected projections on future ethanol use at the recent Agricultural Outlook Conference.

Vilsack also expressed annoyance that Congress has said the Navy should not buy advanced biofuels unless the cost is no more than conventional fuels, even though the advanced biofuel industry is only getting started and has obvious start-up costs.

He urged ethanol producers to make a more aggressive campaign to educate the public about the industry. He acknowledged that the oil industry has more money for marketing, lobbying and campaign donations, but said ethanol producers can make big strides by using social media.

With almost no costs, he said, the industry could produce videos with creative messages that millions of young people would watch on You Tube.

The secretary also urged the ethanol industry to make alliances with other groups and to counter the “unholy alliance” of oil companies, environmentalists and consumer groups that claim oppose ethanol.

“We have a lot of tools we haven’t used to maximum effect,” Vilsack said.

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