Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...

As shown in Table VI.A.2-1 and Figure VI.A.2-2, once all the construction
projects currently underway are complete (estimated by December 2007), the resulting
U.S. ethanol production capacity would be over 7.3 billion gallons. Together with
estimated biodiesel production (300 million gallons by 2012), this would be more than
enough renewable fuel to satisfy the 2012 renewable fuel requirement (7.5 billion
gallons) contained in the Act. However, ethanol production is not expected to stop here.
There are more and more ethanol projects being announced each day. Many of these
potential projects are at various stages of planning, such as conducting feasibility studies,
gaining city/county approval, applying for permits, applying for financing/fundraising, or
obtaining contractor agreements. Other projects have been proposed or announced, but
have not entered the formal planning process. If all these plants were to come to fruition,
the combined domestic ethanol production could exceed 20 billion gallons as shown in
Table VI.A.2-2.
Table VI.A.2-2
Potential U.S. Ethanol Production Projects
2006 Baseline + UC Planned Total ETOH Potential
MMGal/yr Plants MMGal/yr Plants MMGal/yr Plants MMGal/yr Plants
PADD 1 0.4 1 250 3 1,005 21 1,255 25
PADD 2 7,010 128 1,940 15 7,508 90 16,458 233
PADD 3 60 2 108 1 599 9 767 12
PADD 4 155 5 0 0 815 14 970
PADD 5 124 5 128 2 676 18 928 25
Total 7,349 141 2,426 21 10,603 152 20,378 314
a
Proposed
19
a Under Construction
However, although there is clearly a great potential for growth in ethanol
production, it is unlikely that all the announced projects would actually reach completion
in a reasonable amount of time. There is no precise way to know exactly which plants
would come to fruition in the future; however, we’ve chosen to focus our further
discussions on only those plants which are under construction or in the final planning
stages (denoted as “planned” above in Table VI.A.2-2). The distinction between
“planned” versus “proposed” is that as of June 2006 planned projects had completed
permitting, fundraising/financing, and had builders assigned with definitive construction
timelines whereas proposed projects did not.
As shown in Table VI.A.2-2, once all the under construction and planned projects
are complete (by 2012 or sooner), the resulting U.S. ethanol production capacity would
be 9.8 billion gallons, exceeding the 2012 EIA demand estimate (9.6 billion gallons).
This forecasted growth would double today’s production capacity and greatly exceed the
2012 renewable fuel requirement (7.5 billion gallons). In addition, domestic ethanol
production would be supplemented by imports, which are also expected to increase in the
future (as discussed in DRIA Section 1.5).
Of the 60 forecasted new ethanol plants (39 under construction and 21 planned),
all would (at least initially) rely on grain-based feedstocks. Of the plants, 56 would rely
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