Characterized as an “important first step” to “continued foot-dragging” by Nebraska’s U.S. Senators, Ben Nelson and Mike Johanns, the Environmental Protection Agency announced Wednesday that it’s allowing the use of E15 for 2007 model year cars and newer, but took no action on 2001-2006 model year cars, and deny E15 for all other automobiles, motorcycles, boats, and heavy-duty vehicles.

Johanns questioned the Obama administration’s commitment to renewable fuels with its “only partially approved” raising of the ethanol blend wall in gasoline to 15 percent, which he said only “further delay additional decisions about the blend wall.”

“This Administration’s continued failure to stand up for domestic, renewable fuels and American farmers is exasperating,” Johanns said. “Raising the blend wall to E15 is essential to meeting the Renewable Fuel Standard. EPA’s partial approval and continued foot-dragging does not inspire confidence. A muddled transition to E15 keeps a cap on ethanol demand and will likely lead to confusion at the pump. Approving part of the market, denying another part and leaving the rest in limbo is not effective leadership.”

Nelson said the EPA decision is “an important first step that is long overdue.” He blamed the fact that the EPA only limited E15 to 2007 model cars and newer to “dawdling bureaucracy.”

The EPA decision Wednesday applies to 43 million vehicles or about 20 percent of the current U.S. duty fleet.

“It (dawdling bureaucracy) will analyze and study an issue to death,” he said.

Nelson said he confident that the EPA to “quickly approve the use of E15 for vehicles built between 2001 and 2006.”

A total of 86 million cars/light-duty trucks or about 54 percent of all vehicles on the road today are model year 2001 to 2006.

“With that approval, the ethanol industry will be able to move forward to help us meet a requirement that the nation use 36 billion gallons of renewable fuel by 2022,” he said.

But the livestock industry is not wild at all about ethanol, least of all, increasing the blend from 10 percent to 15 percent.

The National Pork Producers Council said Wednesday it is “very concerned with the effect on America’s pork producers of raising to 15 percent the amount of corn ethanol that can be blended into gasoline.” NPPC point to rising corn prices that they said have risen 17 percent in the past three days to nearly $5.90 per bushel compared to the price of corn that was under $4 per bushel in August.

Where Johanns criticized the Obama administration for not doing enough to promote E15 and ethanol, the National Cattlemen’s Beef Association questioned the Obama Administration’s commitment to U.S. livestock producers’ quest to sustain their family operations with its support of ethanol.

Both livestock organizations are blaming the increase in corn prices on ethanol, which has driven their cost of production up causing a lost in equity in their producer’s operations.

Johanns is also strong supporter of extending three tax credits that “incentivize ethanol production.” He is sponsoring a bill would extend, through 2015, the three tax credits set to expire at the end of 2010, including the Volumetric Ethanol Excise Tax Credit, a 45-cent-per-gallon payment to gasoline refiners for blending ethanol into gasoline.

Corn is the primary ingredient in livestock feed and the livestock industry is the nation’s biggest purchaser for corn, but despite the strong criticism of ethanol by the livestock, meat processing and grocery industries, the National Corn Growers Association called Wednesday’s EPA decision “a tentative first step that needs to be followed immediately with more action.”

According to NCGA President Bart Schott, a grower in Kulm, N.D., by proceeding along this path, EPA’s decision casts an “unnecessary shadow on all ethanol blend levels.”

Schott points to an independent automotive engineering firm, Ricardo, that found that moving from 10 percent ethanol in gasoline to 15 percent would mean “little, if any, change in the performance of older cars and light trucks, those manufactured between 1994 and 2000.”

Todd Sneller, administer for the Nebraska Ethanol Board, welcomed the EPA decision. He also said there is some confusion among gasoline dealers about selling E15 in their current E10 pumps. While dealers will have to check insurance policies, Sneller said E10 pumps are certified to sell E15, which could increase ethanol sales in Nebraska and throughout the country by 50 percent if the EPA decision is expanded to all cars, such as in Brazil.

U.S. ethanol exports have been on the rise lately to Brazil, where vehicles there have been running on 100 percent ethanol for many years.

Don Hutchens, executive director of the Nebraska Corn Board, welcomed the EPA decision and is optimistic that it will expand its later rulings to increase the number of vehicles that will be allowed to use E15.

“Brazil has made a very conscience decision that they are going to be dependent on imported petroleum and they are going to use their sugar cane industry and biofuels industry to supply the majority of their motor fuels,” Hutchens said.

With Nebraska debating whether to run an oil pipeline from Canada through the state, the Renewable Fuels Association, in reaction to the EPA announcement Wednesday, said that the agency is “missing an opportunity to reduce America’s dependence on foreign oil and create new economic opportunity by limiting its decision on E15 to only model year 2007 and newer vehicles.”

According to the Renewable Fuels Association, allowing up to E15 blends in all vehicles would increase ethanol production by 6.5 billion gallons annually, displacing more than 200 million barrels of imported oil. Nebraska has 24 ethanol plants that use more than 600 million bushels of corn annually to produce more than 2 billion gallons of ethanol.

“EPA’s scientifically unjustified bifurcation of the U.S. car market will do little to move the needle and expand ethanol use today,” said RFA President and CEO Bob Dinneen. “Limiting E15 use to 2007 and newer vehicles only creates confusion for retailers and consumers alike. America’s ethanol producers are hitting an artificial blend wall today. The goals of Congress to reduce our addiction to oil captured in the Renewable Fuels Standard cannot be met with this decision.”

The Center for Rural Affairs is opposing a federal permit that would allow TransCanada Corporation to build the 1,980-mile Keystone XL Pipeline, a 36-inch pipeline that will carry up to 37.8 million gallons daily of tar sands oil from Alberta, Canada through Montana, South Dakota, Nebraska, Kansas, Oklahoma and to the Texas Gulf Coast.

“America must focus on better approaches to securing the energy it needs by developing renewable energy, especially renewable approaches to fueling cars,” said John Crabtree, Media Director at the Center for Rural Affairs. “We support developing clean energy resources that we have right here in Nebraska, like wind energy, not increasing our reliance on dirty, foreign energy that we have to pipe in from afar.”

He said the Environmental Protection Agency estimates that securing oil from tar sands and delivering it to U.S. refineries results in nearly double the greenhouse gas emissions as other oil delivered to U.S. refineries.

According to Crabtree, in the long-run, hybrid electric cars powered by renewable sources such as wind and low carbon biofuels will create more jobs and far greater economic opportunity in rural America while confronting the very real threat of climate change.

“TransCanada has demonstrated the same corporate tendency to cut corners as British Petroleum, tendencies that for BP resulted in the gulf oil spill and the debacle that ensued thereafter,” said Crabtree.

For example, Crabtree said TransCanada proposed using a thinner walled pipeline than is normally used at the pipeline pressures planned.

“While the company backed down from that plan in response to public pressure, the fact that it was even proposed demonstrates the company cannot be trusted to protect the precious land and water of the Nebraska Sandhills,” he said.

Crabtree said the pipeline project has yet to be approved by the State Department and a number of organizations, individuals and elected officials have voiced concerns about the project moving forward, including 50 members of the U.S. House of Representatives who sent a letter in June 2010 to Secretary of State Hillary Clinton urging her not to rush approval of the Keystone XL Pipeline.

“Even though TransCanada has not received a permit to move the project forward, they are threatening to use strong-arm eminent domain tactics to force agreement with landowners who are not only skeptical about the pipeline, but are also not interested in having it run through their farm or ranch,” said Crabtree.

The battle is raging over the public airwaves about the proposed oil tar sand pipeline from Canada that will cross Nebraska.

As, the proponents rightly state, there are plenty of oil and gas pipelines crossing Nebraska and some of them crossing the Ogalla Aquifer.

But the point being missed in this whole argument is what the pipeline will do to Nebraska’s ethanol industry?

At a time when Americans need to invest in lessening our dependence on foreign oil and build new domestic alternative energy industries that will keep our wealth at home and not shipping it out overseas, a discussion is raging in Nebraska about allowing a pipeline across our state that will only increase our dependence on imported energy instead of weaning us off that dependency.

Nebraska is the nation’s second leading ethanol producing state with more than 2 billion gallons of home grown ethanol. Every day we export billion of dollars to purchase foreign oil causing a negative trade balance. With ethanol, the corn we grow in Nebraska is processed in Nebraska where it adds wealth to our state economy.

Adding more dependency on foreign energy instead of creating more demand for domestic alternative energy can only hurt ethanol’s prospects long-term. And that hurts Nebraska.

Remember it is the oil industry, along with its allies in the meat industry, that is fighting tooth and nail any future development in the ethanol industry as it cuts into their market share, which is mostly foreign imported oil.

The biofuel industry is just beginning to reach its potential. Corn is not only to be the only source of ethanol production. Nebraska is blessed with more than 45 million acres of agricultural land. The state’s number one crop is grass, not corn. There’s millions of acres of grassland and marginal farmland that can be converted to ethanol production using crops, such as switchgrass, supplementing the more than 2 billion gallons corn ethanol industry. It’s not hard to imagine that within 10 years (if this nation is really serious about ending its dependency on foreign oil) Nebraska could be producing more than 5 billion gallons of biofuels.

And then there’s Nebraska’s potential to create soydiesel oil from its abundant soybean crop, Again, another homegrown source of biofuel that would be processed here in Nebraska, adding billions of dollars to the state’s economy.

Then we haven’t even touched wind energy and its potential, along with other potential sources of alternative energy that could be produced here in Nebraska.

And, we want to throw that all away by increasing our dependency on foreign oil?

Here’s the bigger picture about what the pipeline means to Nebraska.

On Tuesday, the American Coalition for Ethanol, Growth Energy, the National Corn Growers Association, and the Renewable Fuels Association released the following statement:

“America’s ethanol industry has been an undeniable success, creating hundreds of thousands of jobs and reducing our nation’s reliance on foreign oil. These groups that have repeatedly attacked ethanol without validation would leave America with just one course of action: increasing our addiction to foreign oil.

“America’s investment in renewable ethanol has paid dividends. It returns more to the federal government in the form of tax revenue than is spent in investment, and saves the economy billions of dollars in foreign oil expense.

“Constantly pining for fictional fuels or seeking to keep America hooked on the oil standard runs contrary to the desire most Americans have to become energy independent. Instead of facts or new approaches, these groups are recycling tired rhetoric that does nothing to help solve America’s energy problems.”

According to the coalition, anticipating that these groups will once again seek to raise the red herring of the food versus fuel debate, the groups noted, “It’s not surprising that the corporate interests which have profited by hiking the grocery bills of everyday American families would continue to promote the widely-disproven ‘food versus fuel’ fiction. It is sadder to see the other groups be so misled as to think that domestic ethanol is anything but a job-creating, renewable, clean-burning fuel.”

The groups noted some key points:

— A global perspective is important. Global coarse grain supplies are nearly unchanged, the USDA reports, with lower U.S. supplies offset by increased foreign coarse grain production.

— As of Oct. 3, only 37 percent of the U.S. corn crop was harvested. Much of what has been harvested to date was in the areas most adversely impacted by the summer weather. There is potential for an upward adjustment in the overall production number as the harvest is completed.

— For the first time, distillers grains availability will displace more than 1 billion bushels of corn in domestic livestock rations this marketing year, providing a high-quality, high-value feed product for livestock producers, both in the United States and abroad.

Nebraska will be seeing a huge infusion of money into its economy with the agricultural harvest under way. Last week, when the U.S. Department of Agriculture released its October crop report showing lower corn and soybean harvest, crop and commodity prices shot skyward.

In an online article in Cattle Trader Center , the report hat corn futures in Chicago “…surged to another two-year high today, as shrinking harvest prospects and contracting supplies fueled talk of prices heading toward records above $7.50 a bushel.”

That same USDA crop report said that Nebraska corn farmers were projected to harvest  1.51 billion bushels, down 4 percent below last year’s record high. But with the price a dollar or more higher than last year, that’s an infusion of almost $2 billion into Nebraska’s state economy.

While the higher prices bring more money into the state’s economy, we can’t lose focus that the reason why the crop is down is because of weather. Weather this summer and fall lowered corn and soybean prospects in Nebraska.

The same is true with soybeans, which also saw increases in price compared to a year ago. Friday’s report said that state soybean production is forecast at a record high 281 million bushels, 5 percent below last month but still 8 percent above the previous record set last year. That increase is another infusion of $300 million or more of money into the state’s economy.

 Modern agriculture is very dependent on modern big time harvests and weather is going to become more and more of a factor as the world and market traders hang on the very outcome of each year’s crop.

“Crop failures set to increase under climate change Large-scale crop failures like the one that caused the recent Russian wheat crisis are likely to become more common under climate change due to an increased frequency of extreme weather events, a new study shows. However, the worst effects of these events on agriculture could be mitigated by improved farming and the development of new crops,” according to the research by the University of Leeds, the Met Office Hadley Centre and University of Exeter.

According to the researchers, the unpredictability of the weather is one of the biggest challenges faced by farmers struggling to adapt to a changing climate.

“Some areas of the world are becoming hotter and drier, and more intense monsoon rains carry a risk of flooding and crop damage,” according to the story.  “A summer of drought and wildfires has dramatically hit harvests across Russia this year, leading the government to place a ban on wheat exports. This led to a dramatic rise prices on the international commodity markets which is likely to have a knock-on effect in higher prices of consumer goods.”

 But the authors of the new study,  argue that “adaptation to climate change be possible through a combination of new crops that are more tolerant to heat and water stress, and socio-economic measures such as greater investment.”

 Lead author Dr Andy Challinor, from the University of Leeds School of Earth and Environment, said: “Due to the importance of international trade crop failure is an issue that affects everyone on the planet, not just those in crop-growing regions.

“More extreme weather events are expected to occur in the coming years due to climate change and we have shown that these events are likely to lead to more crop failures. What we need to do now is think about the solutions.

 ”It is highly unlikely that we will find a single intervention that is a ‘silver bullet’ for protecting crops from failure. What we need is an approach that combines building up crop tolerance to heath and water stress with socio-economic interventions.”

Study co-author Dr Evan Fraser, also of the University of Leeds, said: “It appears that more developed countries with a higher GDP tend to evolve more advanced coping mechanisms for extreme events. In China this is happening organically as the economy is growing quickly, but poorer regions such as Africa are likely to require more in the way of aid for such development.

“What is becoming clear is that we need to adopt a holistic approach: new crops for a changing climate and better farming practices that can only come about under more favourable socio-economic conditions.”

 The team will now expand their research to look at other crops in different regions and they will look more closely at the reasons why increased GDP appears to protect against drought.