How Will Year-Round E15 Impact Nebraska's Economy?

From left: A corn field in Hastings, an ethanol production plant in Bridgeport, and a gas station in Gothenburg. (Photo by Becca Costello, NET News)
Listen to this story: 

August 13, 2019 - 6:45am

A change approved by the Trump administration means gas stations can sell fuel with up to 15% ethanol during the summer for the first time. As the state ranked second in the nation for ethanol production, Nebraskans are hoping for economic benefits.

A few hundred farmers packed into a hot tent in Council Bluffs in June to hear President Trump celebrate the change: E15 could be sold every month of the year.

Read more about the environmental impact of the ethanol industry: Energy Experts, Environmental Advocates Urge Pumping Brakes On Ethanol

"And we celebrate the bright future we are forging together powered by clean, affordable American ethanol," Trump said to applause. "Congratulations." 

Until this year, the EPA prohibited E15 sales from June to mid-September for environmental concerns –

Lynn Chrisp was in the audience that day. He farms just outside Hastings, Nebraska and is president of the National Corn Growers Association. For him, it’s a no-brainer: the more corn ethanol on the market, the better for farmers.

"There's been significant expansion and demand for corn in this part of the country that has added to the economic well-being of south-central Nebraska," Chrisp says. 

Last year about 40% of the state’s corn crop was used to produce ethanol. Chrisp sends his corn to Chief Ethanol, just about 15 miles away.  

Lynn Chrisp in one of his corn fields near Hastings, Nebraska. This corn will eventually go to Chief Ethanol for production. (Becca Costello, NET News)

Ted Free is general manager at Bridgeport Ethanol, a production plant in the panhandle. He says the vast majority of their corn is local, for the simple reason that it’s cheaper to transport from nearby.

"Most of it, I would say, is within a 200-mile radius," Free says. "But most of it's even closer than that."

The state’s 25 ethanol plants employed about 1,400 people and generated $13 million in tax revenue last year. But part of the economic impact doesn’t even come from ethanol.

"So we actually make four products," Free says. "We make ethanol, we make the feed wet distillers grain, we make some corn oil and some corn syrup."

And that mostly comes from the same process – that means not much extra energy to make the other products.

The corn kernels are ground up into a powder, then mixed with an enzyme to break down the starch. Free points out the tank where this slurry is mixed together: "All we’re doing is just breaking down the corn and trying to get as much sugar and starch as we can out of it."

This slurry is cooked on a high heat and then fermented for 50 hours or more.

"A lot of people kind of chuckle with this, but it's based on the very same principles as the old stills that you know, people used to have illegally," Free says. "This is just a great big still to make alcohol."

The alcohol is removed to make ethanol, and the solids left over go through a centrifuge to separate into corn syrup, oil, and animal feed.  

The solid material left over becomes a high-protein animal feed. At Bridgeport Ethanol, pictured, the wet feed goes directly to local livestock farms. At some ethanol plants, the feed is dried before shipping out. (Becca Costello, NET News)

Here at Bridgeport, this distiller’s grain goes to local livestock farms. That completes what some call the “Golden Triangle”: local corn farm to local ethanol plant to local livestock farm.

But even outside that triangle, Agricultural Economist Kate Brooks says all Nebraskans benefit:

"So we look at the value of that production, and then we're also looking then at the employees’ wages and taxes that they're paying as well, to look at how that money is circulating within the state," Brooks says. 

So many factors contribute to the ethanol industry: lower corn prices might encourage ethanol plants to buy more, but if they can’t sell more ethanol then they won’t take advantage. And those same lower corn prices means farmer aren’t getting as much for their product. 

So will having E15 on the market year round benefit Nebraska farmers and the economy? Maybe only slightly, and definitely not immediately.

Less than 70 stations in Nebraska carry E15, and it isn’t sold at all in 20 states – although availability is growing quickly.

But many hope the small change making E15 more accessible will make Americans more aware of their options.

A gas pump sign at Blue Heron in Gothenburg advertises various ethanol blends. (Becca Costello, NET News)

For now, many people don’t know enough to decide what kind of fuel to put in their car.

Gwen McDiarmid knows that first-hand. The blender pumps at her gas station off I-80 in Gothenberg have a lot more buttons than most people are used to.

"The yellow one is the flex fuel which includes the E85 but also the E30 and E40," McDiarmid says as she points to a pump. "We have them color coded at the top." 

McDiarmid points out how much cheaper the ethanol blends are. On this day, E15 is 10 cents cheaper and E85 is 40 cents cheaper per gallon.

"You know, when people realize that, that they're paying less for their gas that they will probably travel more than they do now. You know? So that has to be good for everybody," she says. 

Farmer Lynn Chrisp says ethanol is pretty new to most people, so he still hears misconceptions like it will damage your car.

But for him, ethanol has been an established part of his community and fourth-generation farm since 1985:

"Chief Ethanol was the first ethanol plant in the state of Nebraska, here in Hastings. They've been operating for most of my farm career." 

Whether or not lifting the restrictions on summer sales of E15 makes a big impact, the ethanol industry pumps a significant amount of money into the Nebraska economy. 

Editor's Note: A previous version of this story incorrectly stated gas stations have to install new pumps to sell E15. Although new “blender” pumps are required for higher blends like E30, E40 and E85, a typical gas pump can dispense E15 after an inspection from the Nebraska State Fire Marshall. 



blog comments powered by Disqus