2014 Cornvention February 19, 2014

1. 2014 CornventionFebruary 19, 2014 “The Future of Ethanol and E15” Pam Keck Director of Biofuels National Corn Growers Association

2. Corn Ethanol Past, Present, Future - NCGA Ethanol Committee - Corn Production - Corn Ethanol Co-Products - Renewable Fuel Standard, RFS - Required Volume Obligation, RVO - Consumer Demand

3. About the NCGA Ethanol Committee • Policy • Maintain and • Expand Markets • Environmental Impact • Co-products • Education and • Promotion

4. Corn Demand Feed/Residual – 39.5% Ethanol - 30.8% Distillers Grains - 9.2% Export – 8.4% FSI – 12.1 %

6. Acres and Production Million Acres Billion Bushels Source: USDA

7. Sustainability increases 1980-2011 Source: Field to Market

9. Corn is an inexpensive ingredient

10. What’s in a kernel? 62% starch (polymer of glucose) 15% moisture 3.8% oil 19.2% protein and fiber Source: Bunge

11. Corn Ethanol Production has TWO Co-products 31.5 lbs. of starch OR 33 lbs. of sweetener OR 2.8 gallons of ethanol OR 22. 4 lbs. of PLA fiber/polymer + 17.5 lbs of DDGS + 1.5 lbs. of corn oil C2H6O Composition: protein, fat, fiber

12. Purpose of the RFS • Enacted by Congress and implemented by EPA in 2005 • and modified in 2007 (RFS2) to: • Decrease reliance on petroleum • Decrease GHG emissions • Enhance rural economy

13. Renewable Fuel Standard Volumes

14. RFS has decreased U.S. foreign oil U.S. still imports 3 billion barrels/year

15. The RFS has decreased GHG emissions Since 2007, a reduction of approximately 200 million metric tons of CO2 - the equivalent of taking 39 million cars off the road. EPA predicted by 2022 corn starch ethanol would produce 20% less GHG emissions than gasoline from petroleum. We are there TODAY and a strong scientific case has been made that the number is closer to 50% reduction.

16. The RFS has spurred rural economy • Since the RFS was enacted in 2007 total direct government payments, adjusted to 2009 dollars, have decreased • Since 2005, farming sector property tax payments have increased by 28% • Since 2005, increase in ag jobs of 5.4% • Since 2006, 97% increase in farm income

17. 2014 Required Volume Obligation, RVO Total – Advanced = 14.4 13.01 14.4 (conventional) *all volumes are ethanol-equivalent unless otherwise specified in billions

18. RFS must stay the course • If the EPA moves forward with a reduction in corn ethanol volumes this will most certainly: • Confound agricultural planning and marketing • Threaten the economic viability of corn growers and ethanol producers • Diminish the reduction in GHG emissions • Diminish energy security • Undermine business plans for future biofuel optimization and expansion • Threaten the further development of engines to run on • mid-level blends of ethanol (MLEB)

19. Auto makers embrace octane from ethanol • Summary of multiple published articles from the automobile industry and a government lab show that ethanol in the 20-30% range can: • Increase compression ratio, thereby engine efficiency • Reduce knock tendency • Reduce combustion gas temperatures and criteria pollutant emissions • Produce no loss in volumetric fuel economy (mpg) and range

20. Moving to mid-level ethanol blend requires… • Feedstock and fuel providers working with • automotive manufacturers • Alignment with fuel retailers and equipment • manufacturers and supportive education, promotion, marketing • Policy alignment between USDA, DOE, EPA • All of us promoting ethanol as: non-toxic, renewable, • cleaner, low-cost source of octane (compared to BTX) • Buy FFVs, use E85 and E15

21. Thank you!

22. Proposed 2014 Volume Requirements aAll volumes are ethanol-equivalent, except for biomass-based diesel which is actual volume.bEPA is requesting comment on alternative approaches and higher volumes.