RENEWABLE FUELSASSOCIATION

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WHAT IS ETHANOL?Ethanol is a renewable, biodegradable, high-octane and low-carbon motor fuel derived from the sugars, starches, and cellulosic matter found in plants. Most U.S. ethanol is made from corn and processed through dry milling.

THE POCKET GUIDE TO ETHANOL is a quick reference of significant statistics for American-made fuel ethanol. It is a companion to the Renewable Fuels Association’s more comprehensive 2020 Ethanol Industry Outlook, found online at https://EthanolRFA.org/publications/outlook/.

THE RFA has been the leading trade association for the U.S. ethanol industry for nearly 40 years. Our focus is on driving expanded demand for American-made renewable fuels and bio-products worldwide. Membership includes grain-based and advanced ethanol producers, the ethanol value chain, academia, and industry advocates.

Geoff CooperRFA President & CEO

Corn/Sorghum/Cellulosic Biomass/Waste 3.4%

Corn/Sorghum 2.1%

Cellulosic Biomass 0.5%

Waste Sugars/Alcohol/Starch 0.1%

Corn Starch 94.0%

U.S. Ethanol Production by Feedstock Type

Source: RFA

Grain Receiving and Storage Milling Cooking Liquefaction Fermentation

Syrup Tank Evaporator Liquids

Dried Distillers Grains Dryer Bottling, Dry Ice and Other Uses

Centrifuge

Distillation

Corn Distillers Oil

Feed

Biodiesel

Distillers Grains to Market

Distillers Grains to Livestock and Poultry

Wet Distillers Grains Solids Denaturant

Molecular SieveEthanol Storage Ethanol to Market Ethanol-Blended Gasoline to Consumer

Dry Mill Ethanol Process

3

WHERE IS ETHANOL MADE?The United States led the world in ethanol production in 2019 with an estimated output of 15.8 billion gallons.

Historic U.S. Fuel Ethanol Production

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

18,000

16,000

14,000

12,000

10,000

8,000

6,000

4,000

2,000

0

Mill

ion

Gal

lons

15,800

Source: RFA and U.S. Energy Information Administration *Estimated

European Union1,440; 5%China900; 3%India530; 2%Canada500; 2%Thailand420; 1%Argentina290; 1%Rest of World600; 2%

Brazil8,620; 30%

United States15,800; 54%

Source: RFA analysis of public and private data sources

2019 Global Fuel Ethanol Production by Country(Country, million gallons, share of global production)

Twenty-six states are home to 205 biorefineries, although half of total nameplate capacity is found in Iowa, Nebraska, and Illinois alone.

Installed Ethanol BiorefineryNew Biorefinery Under Construction*

RI

VT

NJ

DEDC

CT

NH

MA

MD

ID

NMAZ

CA

OR

NV

WA

MT NDMN

WI

LATX

COUT

WYSD

NE

KS

OK AR

MO

IA

FL

MI NY

PA

WVVA

NC

SC

GA

ALMS

IL IN

OH

KY

TN

ME

*Excludes expansion projects

U.S. Fuel Ethanol Biorefineries by State

Installed Ethanol Biorefineries

Total Installed Production

Capacity (mgy)

Average Capacity per Biorefinery

(mgy)

1999 50 1,799 36.0

2004 79 4,398 55.7

2009 191 13,028 68.2

2014 213 15,077 70.8

2019 205 16,964 82.8

Historical Biorefinery Count and Production Capacity

Source: RFA *As of December for each year specified

2

54

EFFICIENT PRODUCERSAmerican farmers are becoming more efficient at growing crops, harvesting a robust 168 bushels of corn per acre in 2019, for a total production of 13.7 billion bushels. Meanwhile, agricultural producers have been reducing per-bushel inputs like land, fertilizer, and water.

1929

1939

1949

1959

1969

1979

1989

1999

2009

2019

200

150

100

50

0

200

150

100

50

0

Mill

ion

Plan

ted

Acre

s

Bush

els/

Acre

Acres (Left) Yield (Right)

U.S. Corn Acreage and Average Yield

Source: RFA using U.S. Dept. of Agriculture data

Ethanol producers, too, have been making significant gains in yields and reducing energy inputs. Corn ethanol has a positive net energy balance: on average, dry mill biorefineries produce roughly 2.7 units of energy for every unit of fossil energy used to produce it. The most efficient plants edge closer to 4:1.

Energy production is not the only output at ethanol plants.On average, 1 bushel of corn processed by a dry mill ethanol biorefinery produces:• 2.92 gallons of denatured ethanol• 15.86 pounds of distillers grains animal feed

(10% moisture)• 0.80 pounds of corn distillers oil for biodiesel

production & animal feed• 16.5 pounds of biogenic carbon dioxide

for food/beverage & industrial markets.

76

UNLOCKING NEW PRODUCTSThe U.S. ethanol industry generated 39.6 million metric tons of distillers grains and gluten feed/meal. These bio-products are valuable corn and soybean meal substitutes in animal rations around the world.

Beef, 44%

Dairy, 30%

Swine, 16%

Poultry, 9% Other, 1%

Distillers Grains Consumption by Species

Source: Distillers grains marketing companies

Source: RFA based on data from U.S. Dept. of Agriculture. *Estimated Note: All co-products converted to 10% moisture basis.

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

Thou

sand

Met

ric T

ons

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

Distillers GrainsCorn Gluten FeedCorn Gluten Meal

U.S. Ethanol Industry Co-product Animal Feed Output 593

3,02336,028

Source: RFA based on U.S. Dept. of Agriculture data *Estimated

3,774Corn Distillers Oil Production

Ethanol plants extracted 3.8 billion pounds of corn distillers oil– a nearly $1 billion market underpinning the production of biodiesel and animal feed.

Biorefineries captured 5.8 billion pounds of high-grade biogenic CO2 for food/beverage and industrial markets. And, in a pivotal step toward fighting climate change, the industry is actively engaged in promoting the groundbreaking deployment of carbon capture and sequestration.

0500

1,0001,5002,0002,5003,0003,5004,000

2007

2006

2005

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

Mill

ion

Poun

ds

98

FOCUS ON THE RURAL ECONOMYWith trade policy decisions that hampered global crop marketing and bad weather wreaking havoc across the Corn Belt, 2019 was a year that many in rural America are glad to have in the rear-view mirror. This is why a flourishing ethanol industry remains of vital importance.

The impact of this value-added proposition ripples through-out rural America in terms of higher tax revenues and GDP, as job creation and higher household incomes.

VALUE OF OUTPUTS PER BUSHEL

Ethanol..........................................$3.82Distillers Grains..........................$1.11Corn Distillers Oil.......................$0.17

TOTAL $5.10

Ethanol’s Value-Added PropositionBased on average prices and product yields in 2019, a typical dry mill ethanol plant was adding roughly $1.20 of additional value--or 31%--to every bushel of corn processed.

CORN COST PER BUSHEL$3.90

$0

$5,000

$10,000

$15,000

$20,000

$25,000

$30,000

$35,000

$40,000

$45,000

Mill

ion

Dol

lars

Ethanol Co-products

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

Gross Value of U.S. Ethanol Industry Output

Source: RFA based on U.S. Dept. of Agriculture data * Estimated

7,02520,948

In 2019, the production of 15.8 billion gallons of ethanol and 39.6 million metric tons of co-products and distillers oil had substantial economic impacts, including:• 68,684 direct jobs• 280,327 indirect and induced jobs• $43 billion contribution to GDP• $23.3 billion in household income

Notably, 1 in 5 employees is a military veteran—triple the national average.

ENERGIZING GLOBAL MARKETSThe United States is the world leader in the export of ethanol. Shipments declined modestly in 2019 to an estimated 1.5 billion gallons, second only to the record 1.7 billion gallons shipped in 2018. This means one of every 10 gallons produced was shipped outside our borders, with half of exports destined for Brazil and North America.

TOP 5 Destinations for U.S. Ethanol in 2019

• Brazil• Canada• India• South Korea

• Colombia

Source: RFA based on based on U.S. Dept. of Commerce & U.S. Census Bureau Jan.-Nov. data

U.S. biorefineries satisfied growing domestic animal food needs while also exporting nearly one of every three tons of distillers grains produced, or 10.9 million metric tons. In 2019, four countries purchased half of all U.S. DDGS exports, while remaining volumes shipped to another 50 around the globe.

TOP 5 Destinations for U.S. Distillers Grains in 2019

• Mexico

• South Korea

• Vietnam

Source: RFA based on based on U.S. Dept. of Commerce & U.S. Census Bureau Jan.-Nov. data

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

1,8001,6001,4001,2001,000

800600400200

0200400600800

Mill

ion

Gal

lons

Exports Imports Net Exports

Source: RFA based on data from U.S. Dept. of Commerce & U.S. Census Bureau*Estimated based on Jan.-Nov. 2019 data

U.S. Ethanol Exports and Imports

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000 Th

ousa

nd M

etric

Ton

s

2007

2006

2005

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

10,930

U.S. Distillers Grains Exports

Source: RFA based on data from U.S. Dept. of Commerce & U.S. Census Bureau*Estimated based on Jan.-Nov. 2019 data

10 11

• Indonesia

• Turkey

A CLEAN SOURCE FOR OCTANE A fuel’s octane rating is the measure of its ability to resist “knocking” in the engine, which is caused when the air/fuel mixture detonates prematurely during combustion. Accord-ing to the U.S. Department of Energy, “Using a lower octane fuel than required can cause the engine to run poorly and can damage the engine and emissions control system over time. It may also void your warranty.” Automakers are increasingly using turbocharged, higher- compression engines requiring the use of high-octane gasoline. This higher demand has bumped the price spread between premium and regular gasoline in 2019 to the highest level in at least two decades.

15%14%13%12%11%10%

9%8%7%6%5%

Prem

ium

Sha

re o

f Gas

olin

e Sa

les

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

30%

25%

20%

15%

10%

5%

0% Pric

e D

iffer

ence

Bet

wee

n Pr

emiu

m a

nd R

egul

ar G

asol

ine

Premium Share of Gasoline Sales Retail Price Spread: Premium vs. RegularWholesale Price Spread: Premium vs. Regular

Premium Gasoline: Share of Sales and Price Difference vs. Regular

Source: RFA based on U.S. Energy Information Administration data

Ethanol is helping to hold down the cost of both regular and premium gasoline. According to a study by Dr. Philip K. Ver-leger, Jr., consumers saved an average of $0.22/gallon from 2015-2018 as a result of the use of ethanol.

Ethanol has a blending octane rating of 114—the highest value of any major source. In 2019, ethanol traded at the largest discount to its blending value, retaining the title of the most cost-competitive source of octane in the world.

9395

101104

107110

117

70

75

80

85

90

95

100

105

110

115

120

GasolineBlendstock

n-Butane Alkylate Benzene Toluene Xylene MTBE Ethanol Methanol

Oct

ane

Ratin

g

Source: U.S. Department of Energy

Blending Octane Ratings of Various Gasoline Octane Boosters Ethanol

114

84

300

250

200

150

100

50

0Alkylate Reformate Toluene MTBE Ethanol ETBE Naphtha

Blend Value Market Price

Cent

s/G

allo

nOctane Blending Value vs. Market Price

Source: Argus Media

12 13

1514

FOCUSING BEYOND E10Since its approval by EPA seven years ago, more than 10 billion trouble-free miles have been driven on E15. E15 typ-ically has an octane rating of 88 and costs less than regular unleaded.

In 2019, President Trump made good on his word and issued a rule allowing E15 to be sold year-round nationwide. As a result, E15 sales grew significantly, fueled by a 10% uptick in stations offering E15 and widespread automaker approval. As a result, E15 sales (about 450 million gallons) surpassed E85 sales (425 million gallons) for the first time. An expanding availability of E85 blender pumps was not enough to buoy significantly decreased flex fuel vehicle production and historically low RIN prices.

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

5,000

4,000

3,000

2,000

1,000

0

No.

of S

tatio

ns

Expansion of U.S. Retail Stations Offering E15 and E85

Source: RFA *Estimated

E10 E85

$3.00$2.80$2.60$2.40$2.20$2.00$1.80$1.60

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Price

per

Gall

on

2019 National Average Retail Prices for E10 & E85

Source: RFA based on data from E85prices.com

A SECURE ENERGY SOURCEEnergy security remains an enduring concern, a reminder of which was provided by the September 2019 attacks on two key Saudi Arabian oil installations. Despite the recent expan-sion of U.S. oil production, the U.S. sent some $35 billion—or $275 per American household—to OPEC nations to pay for crude oil imports in 2019 alone. The addition of 15.8 billion gallons of ethanol to the U.S. fuel supply displaced 559 mil-lion barrels of oil. Without ethanol, U.S. import dependence would have been equivalent to 10% of petroleum demand.

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

Mill

ion

Barr

els

of O

il D

ispla

ced 700

600

500

400

300

200

100

-

231

330387

471494

468 471507 525 543 564 569

559

Source: RFA based on U.S. Dept. of Energy data *Estimated

Historic Oil Import Displacement by Ethanol

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

*

Actual Import Dependence Import Dependence Without Ethanol

70%

60%

50%

40%

30%

20%

10%

0%

54%

53%

61%

58% 47%

40%

10%

4%

27%

20%

U.S. Petroleum Net Import Dependence with and without Ethanol

Source: RFA based on U.S. Dept. of Energy data *Estimated

16

LOW CARBON SOLUTIONThe Renewable Fuel Standard has been an important and effective policy for our climate, reducing CO2-equivalent GHGs by an astounding 600 million metric tons over the last 15 years. That is the equivalent of removing about half of the cars on the road in America for one year or eliminating the annual emissions from 13 coalfired power plants.

Corn ethanol from a typical dry mill has 35-50% lower GHG emissions than gasoline (this includes theoretical land use change emissions). As a result, the industry is responsible for 22 million metric tons of GHG reduction from California’s transportation sector since 2011—more than any other low carbon fuel.

RFA STAFF

St. Louis, MOGeoff Cooper President & CEO Ken Colombini Communications DirectorKelly Davis Vice President of Regulatory AffairsAnn Lewis Senior AnalystJackie Pohlman Manager of Member RelationsKelsey Quargnenti Digital Marketing CoordinatorScott Richman Chief Economist

Other Midwest StaffCassie Mullen Director of Market DevelopmentMissy Ruff Director of Safety & Technical ProgramsRobert White Vice President of Industry Relations

Washington, DCJessica Bennett Vice President, Government & External AffairsTony Dennis Office ManagerBob Dinneen Senior Strategic AdvisorMary Giglio Director of Special Projects & EventsConnor Hamburg Director of Government AffairsEdward S. Hubbard, Jr. General Counsel

RFA OFFICERS

CHAIRMAN Neil Koehler, Pacific Ethanol Inc.

VICE CHAIR Jeanne McCaherty, Guardian Energy LLC

TREASURER Charles Wilson, Trenton Agri Products LLC

SECRETARY Rick Schwarck, Absolute Energy LLC

Ethanol

Renewable Diesel

Biodiesel

Electricity

Biomethane

Other

1%

9%

10%

15%

26%

39%

California LCFS Credit Percentage by Fuel, Q1 2011 - Q2 2019

Source: RFA using California Air Resources Board data

In addition to reducing GHG emissions, ethanol is the best tool available to reduce tailpipe emissions of other harmful pollutants. Adding ethanol to gasoline reduces tailpipe emissions of the follow-ing pollutants, among others:

• Carbon monoxide, which can cause harmful health effects by reducing oxygen delivery to the body’s organs.

• Exhaust hydrocarbons, which contribute to ozone, irritate the eyes, damage the lungs, and aggravate respiratory problems.

• Air toxics like benzene, which can cause cancer and reproductive effects or birth defects.

• Fine particulate matter, which can pass through the throat and nose and enter the lungs, causing serious health effects.

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