What Does the Next Generation Fuels Act Mean for Corn Growers?

E85 Pumps ( Charles Johnson )

Because of reduced travel and other complications associated with COVID-19, researchers found ethanol producers will lose about $8 billion this year. The study was conducted by economists from the University of Florida and Arizona State University.

For corn growers and ethanol producers, an act recently proposed by Rep. Cheri Buston, D-Ill., could be the saving grace they’re looking for. It’s called The Next Generation Fuels Act and, if passed, would establish a 98 Research Octane Number (RON) standard for gasoline and require sources of additional octane resulting in at least 30% fewer greenhouse gas emissions than unblended gasoline.

“Really, it paves the way for higher blends of ethanol to get in the fuel supply,” says Kevin Ross, National Corn Growers Association (NCGA) outgoing president. “That translates into about five billion gallons of ethanol as well as 1.7 billion bu. of corn.”

If this bill were to pass, it would make a huge splash for the corn market, however, deals like this don’t happen overnight. Consider this the first step in a long journey.

It’s not just lawmakers who have to buy in, auto manufacturers will need to move to a new generation of engines that can accept this new gasoline standard. If passed, the Act would move the country to accomplishing environmental goals.

“This paves the way for us to get to higher compression motors and getting these CAFE (Corporate Average Fuel Economy) standards, which are the long-term fuel mileage goals,” Ross says. “At the end of the day, ethanol is such a great fuel and such a clean fuel.”

Listen to AgriTalk with Chip Flory and Kevin Ross for more details and commentary on the state of ethanol and the Next Generation Fuels Act: