NCGA Seeks Action Team, Committee Members, Leadership (Mon, 26 Jul 2021)
The National Corn Growers Association is seeking applications from members interested in working on 2022 NCGA action teams, which begin Jan. 1, 2022. This service provides growers an opportunity to play an active role in shaping their industry’s future and becoming a part of the national agricultural leadership community. The action teams specialize in important subject areas, including Ethanol; Market Development; Member & Consumer Engagement; Production Technology Access; Risk Management & Transportation; Stewardship; and Sustainable Ag Research. Positions are also available on Standing Committees, which include CornPAC and the Resolutions Committee. Qualified applicants must be an NCGA member or prospective member and/or contribute to their state checkoff program, if applicable. Ideal candidates should have an interest or expertise in a particular area relevant to the team focus. Action Teams represent a cross-section of corn production. The teams may utilize staff, growers and industry members to serve as resources, as determined by the action team chair. For the Action Team Application, which includes descriptions of the revised team portfolios, click here. The deadline for receipt of applications in the state corn association offices, where applicable, is August 6. State offices will then coordinate applications and submit them directly to NCGA by August 13. Interested parties can contact Kathy Baker at the NCGA office with questions at (636) 733-9004.

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EP. 22 - Transportation Energy Reality Check, with Fuels Institute Executive Director John Eichberger (Mon, 26 Jul 2021)
Corn and ethanol still have an important role to play in fueling America’s transportation needs. Between a couple of recent high-profile court cases and all the hype surrounding electric vehicles, stakeholders in the corn and ethanol industry are looking for a little reassurance right now. But the reality of the transportation energy puzzle is a little more complex than what you’ve heard on the news. So in this episode, we’re joined by John Eichberger, executive director of the Fuels Institute, for a reality check about the present and future of the transportation energy sector. Together with NCGA CEO Jon Doggett, he discusses the shifting makeup of the American transportation fleet, the hurdles to mass adoption that electric vehicles still face, the probable impact of recent court cases, and why ethanol remains the best option for decarbonizing American transportation today. Direct Share Link John Eichberger: There are very low carbon solutions out there, that I'm concerned are not being given the attention they deserve because of this fascination or fixation on EVs are the solution and biofuels are currently the best option for reducing the carbon intensity of our transportation fuel, we've got to pay attention to it. Dusty Weis: Welcome to Wherever Jon May Roam, The National Corn Growers Association podcast. This is where leaders, growers, and stakeholders in the corn industry can turn for big-picture conversations about the state of the industry and its future. I'm Dusty Weis. I'll be introducing your host association, CEO, John Doggett. From the fields of the Corn Belt to the DC Beltway we're making sure that the growers who feed America have a say in the issues that are important to them with key leaders who are shaping the future of agriculture. Dusty Weis: Between a couple of recent high profile court cases and all the hype surrounding electric vehicles, stakeholders in the corn and ethanol industry are looking for a little reassurance right now. But the reality of the transportation energy puzzle is a little more complex than you've heard on the news. In this episode, we're joined by John Eichberger, executive director of The Fuels Institute for a reality check about the present and future of the transportation energy sector. But if you haven't yet make sure you're subscribed to this podcast and your favorite app, also make sure you follow NCGA on Twitter @NationalCorn and sign up for The National Corn Growers Association newsletter at ncga.com. Dusty Weis: With that, it's time to once again, introduce John. John Doggett, the CEO of the National Corn Growers Association, and John I'm old enough to remember a time when ethanol was the next big thing in clean and renewable fuels. Twenty years ago, it was being celebrated as a homegrown solution to America's energy independence, and an environmentally sound way power our cars and trucks. Jon Doggett: Dusty, I remember back in about 2007, 2008, I was walking down the hall in a house office building on Capitol Hill, and I had a member of Congress who I had never spoken to before approached me and said, "You're the corn guy, aren't you?" I said, "Yes, sir. I'm the corn guy." He said, "Well, I want to do an ethanol bill." He was from the east coast. He was not from middle America. I said, "What kind of ethanol bill do you want to do?" He said, "I don't care. I really think it's cool. It's cool stuff. It's renewable. This is great. I want to do something." I've been around Washington for a very long time and there's an ebb and flow. We've seen ethanol go up, and we've seen ethanol come down. We've seen ethanol go up. Jon Doggett: We've got some issues right now. If you looked at the headlines and the court cases that seem to always come out on a Friday afternoon, you'd come away thinking, boy, we got some huge, huge problems with ethanol, but Dusty what we wanted to do today was take this opportunity for a quick reality check on what's really going on with the corn ethanol industry, and to do that, we're bringing in one of the world's foremost authorities representing one of the broadest coalitions of industry stakeholders that's out there. I've known John Eichberger for a long, long time and he is now the executive director of The Fuels Institute, a research organization that studies transportation energy solutions. John, thank you so much for joining this podcast. John Eichberger: Thanks, Jon. It's great to be with you guys and great to see you. It has been a long time. We got to know each other back when we both had hair a long time ago. Jon Doggett: Yeah. I almost remember those days. John, give us a self-introduction. Where are you from? How did you end up in Washington? I always think that's such an interesting question to ask people who live and work in Washington, DC. How did you get here and then what happened? John Eichberger: I was born a slow-witted Californian. Graduated from Santa Barbara and moved to DC, started working for a trade association, representing meatpackers and slaughterhouses. Then I moved to Capitol hill where you and I met. I was working for Congressman Greg Gansky out of the great state of Iowa. I remember I was his agriculture energy environment guy, and my first week or two on the job, got this letter from [inaudible 00:04:23] asking about his position on the ethanol so I turned to my legislative director go, "Hey, how does congressmen feel that ethanol, we're from Iowa?" I said, "That doesn't help me. What's ethanol?" John Eichberger: I realized how much I had to learn. I did about two years up on Capitol Hill because that's really all I could stand of that jungle. I went to the convenience store industry where I represented fuel retailers before Congress, the administration, the media, I'm still part of that team since 2000. Then we founded The Fuels Institute back in 2013 to start providing some objective analysis of what's going on in the transportation space. So, it's been a great ride. It's an industry that has so many moving parts and it's been an absolute pleasure to be part of it. Jon Doggett: John Eichberger as I've learned more about you and your organization, one thing that I keep hearing is what a broad and interesting coalition of stakeholders you represent. Who are your stakeholders at The Fuels Institute? What's your mission and whom be represented? John Eichberger: The reason we can have a broad diverse group is we don't have any positions. We don't advocate for anything. We really don't care what happens. We just want people to use real information to make decisions. We've started The Fuels Institute with two primary objectives. One, we wanted to get the different components of the transportation energy space talking to one another more often. When we launched it, you had a situation [inaudible 00:05:45] silos. You had the auto industry in one side, refiners on one side, the biofield guys another side, and the convenience retailers and the customers were caught in the middle. John Eichberger: The impetus for the fuel centers is, can we get these groups start working together to have more sustainable in terms of long life policies that make sense. Then the other thing was when you try to find out what the future is going to be, most research starts with a conclusion and reverse engineers it. We want to start with the questions and provide objective data and analysis to help business leaders and policymakers make better-informed decisions. John Eichberger: Our organization includes refiners, biofuel producers, retailers, automakers, equipment providers, technical experts from the national labs, other industry experts, big engine manufacturers, truck manufacturers, fleet operators. A whole swath of stakeholders who understand the market, at least from their perspective, can come together and paint a really big, broad picture of what is feasible, what's practical and what we should be looking at. Jon Doggett: It's always good to have somebody come and take an objective look at what you're doing and what's your positioning. We tend to not only to get into silos, but we tend to lose a little perspective, and that's why I think having you present to our ethanol committee and other opportunities, we all need that. We need to have this perspective that like you say, we've arrived at the conclusion that ethanol is great and then we back engineer it. Jon Doggett: I still think ethanol is great, but it's nice to have that other perspective coming from a broad spectrum of the industry. That's helpful to the discussion. I've been in the policy arena long enough to know that when you bring all the perspectives to the table in an unbiased fashion, you sometimes can even come out of the other end of that with some pretty good solutions. John Eichberger: Jon, the thing is we get trapped in our own echo chambers. We talk to people who think like us who want the same things as we do and you can get blindsided that way. Quick anecdote. One of my former directors at The Fuels Institute, before he agreed to serve on the board, came to one of our conferences and I heard him tell this story to his executive team afterwards. "The first couple of hours man, I was angry. Here's these people in this room talking about my business. They're not in my business. They don't understand my business. What are they talking about?" John Eichberger: Then I mellowed out and started paying attention and realized we're all serving the same customer at the end of the day. We're all facing similar challenges. We're all trying to do pretty much the same thing and we can learn from one another, and we start breaking down those barriers and those deep seated instinctive animosities, you're right, John, you can come out with some great solutions. Then you've got to sell it to Capitol Hill, which is a whole different animal that I don't have to worry about anymore because I'm at a lobbying gig. I call myself a recovering lobbyists because it's a poison you can never actually get out of your system, but I'm much happier on this side of the equation. Dusty Weis: All right John Eichberger, you guys sit there from 30,000 feet you look down at the transportation energy sector, what are you seeing right now? What are the major trends that we're seeing play out? John Eichberger: Clearly the global momentum is on carbon reduction. That's captured the mindset of most of the politically elected leaders in the world. It is the dominant conversation regarding transportation, and what has happened unfortunately I think is policy makers like to have a simple message to communicate and they have bought into the fact that zero emission vehicles are the future, and that anything we can do to accelerate the marketability of electric vehicles or fuel cell electric vehicles we have to do. There is a huge role for electrified vehicles, absolutely, without a doubt. They play a significant role in decarbonizing transportation. But the challenge has become this, we have, the collective we, become so focused on reducing carbon, and so many leaders have adopted a solution, one solution, at all costs electrify. [inaudible 00:09:53] we're missing the boat. It is going to take decades to transition the fleet to a new technology. John Eichberger: In the interim, what are we doing to decarbonize our existing fleet of 266, 270 million light duty vehicles? How are we going to reduce the carbon intensity of our liquid transportation fuel, improve the efficiency of our combustion engines? We have to do both because even if electric vehicles to gain 40, 50% of the market, we're still going to have combustion vehicles on the road for decades, probably to the end of the century, if not longer. John Eichberger: There are very low carbon solutions out there that I'm concerned are not being given the attention they deserve because of this fascination or fixation on EVs are the solution. We have got to open up the dialogue to address the other opportunities. Quite frankly, like I said, The Fuels Intistute doesn't advocate for any solution. We advocate for the right solutions and biofuels are currently the best option for reducing the carbon intensity of our transportation fuel, we've got to pay attention to it. Jon Doggett: John Eichbeiger, you're talking about everybody's all about electric vehicles, and I have to imagine right now that there's probably an electric vehicle manufacturer lobbyists walking down a hallway in a house office building on Capitol Hill and somebody saying, "You're the electric car guy, right? I want to do an electric car bill. I don't know anything about it, but I want to do one." It's fad, definitely. There will be a lot electric cars on the road, but policy makers want simple solutions. This is so complex and so difficult to work through, and it takes people who come to the right tables and figure out how to get through all of that. John Eichberger: I'm a historian and I believe you have to look at history for lessons about the future. We've seen this movie play out multiple times, you guys upfront and personal. At one time, biofuels renewable fuels were the solution. The environmental community was 100% behind it. Then I started getting momentum and environmental community started poking holes at it. The environmental committee is 100% behind electric vehicles. John Eichberger: At some point, they're going to turn their attention to some of the not as environmentally friendly components of the electric vehicle market. We saw the automakers in 2008 commit to produce half of their vehicles to be flexible vehicles, that didn't happen. Now, the commitments on investments in electric vehicles, there's a lot of reasons for that. Some of them are economic, but you know what, 10, 15, 20 years is a long time in policy and in public sentiment and I don't believe electric vehicles are a fad. John Eichberger: I believe they're going to be here for a very long time. I think they're fantastic vehicles, a wonderful technology. They don't fit every use case. They don't fit every consumer's needs. They don't fit everything they're being tried to be forced into, and so what we've been talking about is let's be strategic about our deployment of solutions to maximize our effectiveness and minimize the cost of the end user. That's what we need to be focused on. Let's reduce emissions and let's benefit the consumer. John Eichberger: If we do that sustainable policies that are environmentally sustainable, but are not economically sustainable, they'll fail. If we focus on emissions, reductions and consumer protection, we're going to come up with successful plan that will stand the test of time. That's the only way we can be successful at this. But unfortunately, in order to get to that point, as we've seen over the decades that we've been watching this market, you have to have policies that fail, market strategies that fail, and then people come back to the table, okay, why did it fail and what can we do differently? That's painful, unfortunately. Dusty Weis: John Eichberger, let's drill down on this a little bit then, who is buying electric vehicles right now and why are they choosing to drive one? John Eichberger: Right now we're still on the early mover stage of adoption. We've just now recently eclipsed 2% of sales in the first quarter of this year, [inaudible 00:13:54] electric. That's not a revolution despite what the headlines tell you, it's an evolution, but it's accelerating, we're getting more and more buying. Most of the people buying them, according to a report we just published at The Fuels Institute are going to be your college-educated, 150,000 a year income. They have a home with a garage. They're tech savvy. They like the technology. They have an environmental perspective that they want to be good for the environment. John Eichberger: They have a societal status perspective. They want to demonstrate and communicate their commitment to technology and environment through their car. But that's a very small component and they're very segmented geographically. It's not geographically dispersed evenly. As we progress and as more vehicles come on the market, as more utility vehicles and electric powertrains become available, as costs come down, you're going to see the demographic profile the EV driver normalize, and you're going to have younger people buying vehicles that can pay $25,000 for a vehicle. John Eichberger: You're going to have people living in apartment complexes that aren't going to have access at home charging so they're going to need publicly available charging infrastructure. It's going to normalize. But I think the problem we get into is, I am convinced that within the next five, six years, you'll be able to buy an electric vehicle for about the same price as a combustion engine, without a tax credit, that vehicle is going to have 300-mile range per charge. John Eichberger: You're going to be able to recharge it in 15, 20 minutes. It's going to have amenities. It's going to be the body style you want. That does not mean the consumer is going to buy it, and that's the key. That's what I think is motivating some of these advocates that we need to ban combustion sales to force consumers to buy these vehicles. Consumer choice is being thrown out the window because I don't think consumers are automatically switch. John Eichberger: Some of them will, but we have a long way to go. When you think about the smartphone and people use the smartphone analogy. If we're uptake as a scenario that can be mimicked by EVs, the smartphone delivered an immediate convenience improvement to your way of life and EV may offer an economic improvement, but it introduces a level of inconvenience regard to energy acquisition that doesn't exist with an ICE, and it is now a compromise, it is a choice. It's not a brand new thing. You're substituting one thing for another and you're making trade-offs and not all customers are going to make those trade-offs. Jon Doggett: It's interesting, I had a conversation the other night with a gentleman who talks about, his dad buys a new pickup every three years. He trades the pickup off for the down payment and he takes out a three-year loan. Does it over and over and over again that used pickup sits on the lot, somebody else buys it and they're trading in an even older pickup to go ahead and spread the payment over 3, 4, 5, 6 years. You have people in other economic categories who are dependent on that progression of where these vehicles go. Jon Doggett: But if you have to replace a battery in an electric vehicle after 6, 7, 8 years, what's that do to the ultimate end-user, that person who not only doesn't own a home, but is maybe a backyard mechanic who can work on a combustion engine, but is not going to have the ability to go ahead and switch out that battery, that's expensive. We talk about the first purchaser of the electric vehicle. Are we thinking about the third purchaser of that vehicle? Because that has been the way that much of our society has got their first car, and been able to drive to their first job. We've got to think about the societal side on that as well. John Eichberger: You raise a great point because we sell 16, 17 million new vehicles a year. We sell 42 million used vehicles a year in the United States. If you're paying attention to what the dialogue is in public policy forums, the issue of environmental and energy equity is a huge issue. How do we make sure disadvantaged communities or quite frankly, rural communities have access to affordable, reliable transportation, because affordable, reliable transportation is an absolute essential need for economic prosperity and growth. John Eichberger: If we're going to be driving the market, no pun intended to a vehicle technology that the new vehicles might be out of the reach of the lower-income consumer, and then when they hit the used car market, Jon, to your point, maybe their actual extended useful life is shorter than the ICE engine. They replaced that lower-income consumers going to buy a vehicle that has a shorter life expectancy and they're going to get trapped in an economic cycle that they may not be able to get out of. John Eichberger: We need to think about these things because you can impose a solution that benefits the wealthy communities and disadvantages the lower-income communities. I don't think we've thought this through all the way, how that's going to materialize. A lot of people have brought the subject, "Well, it's going to figure itself out John, it'll take care of itself." John Eichberger: Is that how we want to be framing the future for transportation space on expectation? Hope that's all going to be resolved well, and I don't think so. I think we need to take these things into very careful consideration. There may be solutions that will support an EV market. There may be solutions that may not, but we need to really think these things through so that we don't come around a corner and go, holy cow, we didn't even think about that, because that's disastrous. Jon Doggett: You're right. We haven't thought about this stuff. We got to start thinking about all of this stuff and there's so much to think about, but I think we're going to have plenty of time to work through it because these problems are going to start cropping up. John Eichberger: Years ago, a good friend of ours in the ethanol industry, he looked at me one time to say, "John, John with you. It's always the negatives and the problems." My response is no, it's the recognition there's hurdles. To be successful, you have to know where there's hurdles are, so you can get over them. When I raise questions like this about the electric vehicle market and the future of transportation, a lot of people go, John, all you're doing is you're just blasting. It's like, no, if we don't think about these things and contemplate and consider them and incorporate them in our plans, everything's going to fall apart and it's not being negative. It's not being disingenuous. Let's not be stupid. Let's actually be smart about this. We've been in Washington area for a long time, that is not always the popular statement. Dusty Weis: John Eichberger, executive director of The Fuels Institute. What about the internal combustion engine then? What is in the future for traditional fuel burning transportation? Are we waving the white flag and throwing in the towel on it? John Eichberger: I think that'd be foolish. I get into debates with some of the OEMs about this quite a bit because several of them are all in on electric, and the internal combustion engine is on its last legs John, why are you still talking about it? I put a lot more faith in EV than I do ICE as the future. I'm not in that camp. I think the combustion engine is going to be here for a very, very long time. Take this consideration. John Eichberger: Let's assume Bloomberg new energy finance forecast when they said 60% of new cars sold in 2040 would be electric. Let's say that comes true. Quite frankly, I don't think it can without government heavy intervention. I don't think the consumers are going to do that, but let's say it happens at that rate, that's only 27% fleet conversion in 20 years, which means 73% of vehicles on the road and 40% of new vehicles will still be combustion engine, and those vehicles have a 20 by then probably a 30-year life expectancy. John Eichberger: You're looking at combustion engines in the market in that aggressive BEV battery electric vehicle scenario into 2070, 2080. I believe that quite frankly, that we have the ability to bring combustion engines with a low carbon fuel option and be zero carbon. It can be done, but we cannot ignore the R&D that's being done currently to achieve that because we have a shiny new solution floating out there. John Eichberger: We do need to perfect the electric vehicle market develop that market because it has so many positives to it, but at the same time, we have to make sure we're doing anything we can to improve the efficiency of the combustion engine, and there are things we can still do and improve the carbon intensity of the liquid fuel market. Then we can have solutions that fit the needs of society and they're all zero carbon. It can be done. We just have to be committed to multiple solutions and not be wed to one and only one. Jon Doggett: The other thing is on our way to zero emissions, how about, we can reduce emissions today using existing technology, using existing vehicles, and using existing infrastructure? I talked to a guy a couple of months ago and he was talking about buying an electric vehicle. I said, "All right, but where's your electricity coming from?" He said, "Well, I'm going to put solar collectors up on my roof." I said, "Okay, that's great." I said, "So you want your car to be powered by solar energy then?" "Yeah." I said, "What's ethanol?" Dusty Weis: Nothing but sunlight that made a 94 million mile journey from the center of our solar system and crash-landed in a field in Iowa, I'll tell you. Jon Doggett: There you go. When I was down in Florida a couple of weeks ago, I was going by all of these large fields with all of these solar panels and then at one point there was a cornfield on the other side of the highway, I thought, hey, this is wonderful. We're generating solar energy here on both sides of the road. Dusty Weis: What role then John Dogget, CEO of The National Corn Growers Association, what role does ethanol play in all of this? How does ethanol come in today and reduce those carbon emissions? Jon Doggett: Well, first of all, we need to increase the amount of ethanol in the fuel tank. We have been fighting against this false construct of a blend wall. But if we could go from E10 to E15, which we could do because we have the existing vehicles and the existing infrastructure and the existing production right now today to do that, that's going to be a massive reduction in greenhouse gas emissions, and that's the role. The role is to do it now with what we have. The perfect cannot stand in the way of the good, and I think right now we have something that's really, really good, and the thing that people are talking about being perfect is a long ways away from being here. Dusty Weis: You bring up an important point there you talk about the E15 blend and certainly a couple of recent court cases have resulted in some pretty negative headlines about the ethanol industry this summer. Could we take a look at those real quick, what was decided and what does it actually mean? Jon Doggett: Well, I think there's two things. It epitomizes. One of the forces that were working against. The first case was about small refinery exemptions. The oil industry came in and said, we need to be able to have small refinery exemptions and don't put any impediments in there, and a part of that is these rent prices are too high. A week later on a Friday afternoon, we have another court case comes out and decides that the Trump administration didn't get it right with E15 summer driving deal. So, you got the oil companies on one side saying rent prices are too high, but then the next week they got a court case that says, hey, we're going to go ahead and not require you to use as much ethanol, so rent prices are going to keep going back up. Jon Doggett: It's crazy. This is the problem with the petroleum industry is, they are complaining about moving to a new technology. They're complaining about moving to a new way of doing business. They need to be energy companies rather than oil companies. I think that's really important and we see some companies in that space starting to do that. They're starting to talk about we're an energy company, not an oil company. I think once we start making that pivot and quit worrying about where everybody's feedstock comes from, I think we've got some really fascinating things to move forward on. Dusty Weis: John Eichberger, from your perspective as executive director of The Fuels Institute, are these just temporary speed bumps for the corn ethanol industry are these longterm setbacks and what's going to be done about? John Eichberger: [inaudible 00:25:57] smaller finery exemptions, I don't know. I can envision a scenario where they continue to be played out because we're still struggling with cellulosic ethanol and finding the other buckets within the [inaudible 00:26:06] categories. On the E15 issue, I want to correct something that John said, there's no requirement to use E15, there is an opportunity to use that has been taken away by the court ruling. I never actually believed that the administration had the authority to provide the summer drive opportunity. John Eichberger: Trump administration did it. No problem. I think it's the right thing. E15 has a lower vapor pressure than E10. I don't understand why doesn't get the one pound waiver, except for the fact that when the Clean Air Act amendment one pound waiver was drafted 1990, E15 didn't exist. That's really the only reason it's not in the Clean Air Act. I think there's definitely scientific evidence that we should have it available year round, because it is better for the environment, it is a quality fuel. John Eichberger: Will EPA find a way to make that available without having to go to Congress, the ethanol industry better hope so, because I don't see this Congress and make-up and their preoccupation of the electrification doing anything to perpetuate the internal combustion engine and liquid fuels market. Maybe I'm wrong. I have been out of the game, the lobbying game for a long time. I don't even know who's in Congress anymore. I don't want to know. I forgot how to count to 218. I don't know what the makeup is, but my gut is that supporting liquid fuels and combustion engines is not on the agenda of the leadership in the house and Senate right now. That being said E15, to John's point, has great opportunities to reduce the carbon intensity of our transportation fuel. I have been talking to the biofuels industry and the oil industry for years about, look work together because if you can lower the carbon intensity to liquid fuels market and lower the carbon profile, the transportation space that perceived need to push electrification will be less. John Eichberger: You can slow down the replacement of your product in the market by being collaborative and doing everything you can to reduce the carbon intensity of the products you guys are selling. You can't sell ethanol without oil. You've got to have them working together, and quite frankly, if I'm in the oil industry, I'm thinking electric vehicles [inaudible 00:28:06] take all my demand or I'm going to team up with the biofuels industry to do something, to mitigate that. I'm making a couple of calls right now. I don't know if that's been happening. I hope it has. I have to hope it has, but there are opportunities here. We're talking about corn and ethanol, but there's a biodiesel side too. There's renewable diesel, there's renewable gasoline being tested over in Europe. There are a lot of opportunities and liquid fuel space and the biofuel component has great value. John Eichberger: We need to figure out and we have an opportunity policy-wise coming up with the RFS statutory volumetric provisions expiring [inaudible 00:28:42] kicked over to EPA, we have an opportunity to evaluate our federal fuels policy. How can we best leverage the carbon profile that biofuel sector in a way that matches infrastructure compatibility, vehicle compatibility and benefits consumers while reducing the carbon intensity. We have an opportunity here that should not be missed. I'm hopeful that those involved in [inaudible 00:29:06] process, do everything they can to figure out that right-size solution that gives us the opportunity to capitalize on that. Jon Doggett: So, John Eichberger, we always talk about what corn growers think and what ethanol producers think, and we think we talk about what we think the oil industry is talking about, but what about your members? What are they saying to you? What are their concerns? What is it that we need to know in the corn industry and in the ethanol industry? What do we need to know about what your folks are thinking about? John Eichberger: Let's redefine my folks. When you say my folks, I think you're going back to my previous job where I was representing retailers. Let's talk about fuel retailers. Fuel retailers are facing a lot of challenges. They're looking at a cafe program that when Mr. Biden resurrects the Obama era program will probably drop gasoline demand by 20 to 25% by 2040. They're looking at an unrelenting barrage of new stories and announcements saying electric vehicles are taking over and threatening their fuel sales. John Eichberger: Fuel sales represent two-thirds of the sales at a convenience store. [inaudible 00:30:14] put that in perspective, yet one-third a profit, 40% of gas customers go inside the store. That fuel island is critically important to the industry. On the flip side, they're spinning thousands upon thousands of dollars per site to be able to accept the chip-based credit cards. John Eichberger: They're also looking at a situation where their underground storage tanks are possibly nearing the end of their useful life of 30 years, they had to replace them between '88 and '98. Do the math. EPA estimates about 20% of storage tanks out there probably into the warranty, which means they need to be replaced yet. You're looking at a situation where demand is going to go down 20 to 30% the next 20 years. You're looking at a $500, $600,000 investment in storage tank. John Eichberger: Why would I do that? They're looking at what do I do about ESG? Because they're starting to get pressure on that too, from all fronts. How do I promote my environmental footprint? Biofuels is on the table. But you also have to keep in mind, we've made great progress in the equipment compatibility profile, the market, there are still some compatibility challenges with higher blends that we need to overcome. John Eichberger: They can be overcome, but we just have to be aware of it, and we have to make sure that we are communicating correctly so we can get these fuels to market in a responsible way. They're really concerned and about the future, because everything seems to be changing and all external pressures are trying to take away their primary business. That's why I think the NAX organizations is so focused on providing these options, these opportunities. John Eichberger: Now, I put my other hat on the fuels Institute. We take a look at the research we're doing. We have sorry, several research projects on EV infrastructure. We have a project that's going to be delivered to me today in the first draft, looking at the life cycle assessment comparison between electric vehicles, combustion engines and the fuels in electricity to power them and what are the different dynamics in there so we understand, what we're dealing with in those two. John Eichberger: We just commissioned a new project, looking at the research in R&D on ICE and liquid fuels, looking at the carbon intensity of biofuels and what policies could help support the capitalization on that carbon-intense benefit. I'm working on a project right now where I collected data from more than 2000 retail stations on their ethanol fuel sales. I've got daily sales data over 12 month period on volume, price and margin for easy E0, E15, E10 unleaded, E85, and we're doing a comparison analysis to understand the business structure there. John Eichberger: We've got a couple of other projects ongoing as well, because we're trying to figure out what are the options. The Fuels Institute is looking at this from a, what are the big levers affecting the market and what is not really understood and how can we deliver value to help improve the understanding of those sectors? It really is all over the place, but almost everything is centering around this. How does this march towards lower carbon affect the market and ultimately how does it affect consumers? Because we keep missing that in the national dialogue, what's the impact on consumers and the diehard advocates go, cost is irrelevant. No cost is not irrelevant. Cost is 100% relevant. It has to be part of the equation and we need to continue talking about it. Jon Doggett: And between the apartment I rent here in Chesterfield and the office, there's probably five convenience stores, I've stopped at, at least four out of the five, and yeah, it's lots of gas pumps. Yeah, I go in to get a candy bar or whatever, and if that market changes that much, what happens to those stores? What happens to the people that work there? What happens to the person that delivers the candy bar that I bought? Where are they going to deliver that? We're talking about some really major shifts and just there is a huge, huge dislocation coming if we don't do this, right. John Eichberger: From the ivory tower capital cities is very easy to say, the number one issue we have is to mitigate climate change, and maybe it is. The reality though, is we have to be paying attention to the human element. How do the policies being considered and contemplated affect families? I'm not talking about families along shorelines, talking about [inaudible 00:34:40] families in all markets and all geographic areas who will likely be affected by a dramatic shift in the market, whether it be more difficult for them to get to and fro because transportation is not as reliable and as affordable, whether it be a loss of jobs because the businesses that have been built to support the current infrastructure disappear, and maybe they can't transition to the new green economy, the way it's being expected. John Eichberger: Again, none of this stuff is insurmountable, but it seems to be lacking from the public discussion. We need to get back to thinking about people and families in the context of global priorities. They don't have to be mutually exclusive, but they better be connected. And I'm hoping we see a little bit more of that going forward. Well, Dusty Weis: John Doggett, CEO of The National Corn Growers Association, general sentiment is that corn ethanol has taken so many blows lately. How are you feeling about it right now? You bullish, you're bearish? Where are you at? Jon Doggett: Bullish. You take a look at what our good friends in the petroleum industry have done since the first RFS was passed. They've spent hundreds of millions of dollars in Washington, DC, and with PR firms and radio ads and television ads, and you name it, and still have the RFS and a little old corn outfit called the NCGA and a couple of ethanol groups, and a whole lot of folks who picked up the phone and called their members of Congress from the Midwest, we've kept that going. Jon Doggett: We have taken body blows before, we will take body blows again. The thing that often happens is that there are a lot of people on both coasts that fail to understand the importance of this to middle America. It took the plywood off of storefronts in small rural communities when they built the ethanol plant on the edge of town. It built the basis for more corn production and more corn price in a whole lot of communities around the middle part of this country. Jon Doggett: I think policymakers, they look at ethanol as, well it's something for those silly farmers. This thing is an existential issue for a lot of our folks. If the ethanol industry goes away, we are going to lose a generation of farmers. That's not going to happen and we're not going to let it happen. We have to continue to work on this, but we have to work with all sorts of people, and we have to work with the John Eichbergers of the world because they're bringing truth and objectivity and a different perspective to this discussion, and we absolutely have to have that. Jon Doggett: If we don't have that, if we don't embrace that we are not going to be successful, but I am very encouraged. I hope that this conversation has eased some of the many, many worries that our stakeholders in the corn industry have about this. This business is always growing, always evolving, new players come and players go, but the fact remains corn ethanol is a tool that's available today. It's ready to benefit the environment right now, and that's not going to change anytime soon. Jon Doggett: John Eichberger, executive director of The Fuels Institute, thanks so much for joining us today for this discussion. I'm John Doggett, I'm the CEO of The National Corn Growers Association, and we hope you will join us again soon for the next episode of Wherever Jon May Roam, The National Corn Growers Association podcast. Dusty Weis: That is going to wrap up this edition of Wherever Jon May Roam, The National Corn Growers Association podcast. New episodes arrived monthly. Make sure you subscribe and your favorite app and join us again soon. Visit ncg.com to learn more or sign up for the associations email newsletter. Wherever Jon May Roam is brought to you by The National Corn Growers Association and produced by PodCamp Media, branded podcast production for businesses, podcampmedia.com. For The National Corn Growers Association. Thanks for listening. I'm Dusty Weis.
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