Ethanol Update State of Missouri

Ethanol UpdateState of Missouri

presented to

Governors’ Ethanol Coalition

August 2007

Omaha, NB

Missouri Department of Natural Resources

Current Facilities

Northeast Missouri Grain — Macon, MONortheast Missouri Grain — Macon, MO

Golden Triangle Energy Cooperative — Craig, MOGolden Triangle Energy Cooperative — Craig, MO

Mid-Missouri Energy — Malta Bend, MOMid-Missouri Energy — Malta Bend, MO

Missouri Ethanol, LLC — Missouri Ethanol, LLC — LaddoniaLaddonia, MO

Missouri Department of Natural Resources

Current Facilities

Missouri Department of Natural Resources

Missouri Facilities

Ethanol Refinery InventoryState of Missouri

Plants M Gals/YrOperating 4 173Valid Air Permits 4 320Pending Construction Permits 8 716Air Modeling Pending 1 200

17 1,409

Missouri Department of Natural Resources

Ethanol Initiatives

Ethanol IncentiveEthanol Incentive E-10 GuidelineE-10 Guideline Increased FFV Target for State Increased FFV Target for State

FleetFleet First FFV HybridFirst FFV Hybrid

Missouri Department of Natural Resources

Ethanol Initiatives

Ethanol IncentiveEthanol Incentive– 51% Missouri Farmer Owned51% Missouri Farmer Owned– 20 cents per gallon for first 12.5 million gallons20 cents per gallon for first 12.5 million gallons– 5 cents per gallon for next 12.5 million gallons5 cents per gallon for next 12.5 million gallons– Total Expenditures - $43.6M (FY2000-2007)Total Expenditures - $43.6M (FY2000-2007)

$13.7M in FY2007$13.7M in FY2007

E-10 GuidelineE-10 Guideline Increased FFV Target for State FleetIncreased FFV Target for State Fleet First FFV HybridFirst FFV Hybrid

Missouri Department of Natural Resources

Ethanol Initiatives

$0

$2,000,000

$4,000,000

$6,000,000

$8,000,000

$10,000,000

$12,000,000

$14,000,000

FY00 FY01 FY02 FY03 FY04 FY05 FY06 FY07

Missouri Department of Natural Resources

Ethanol Initiatives

Ethanol IncentiveEthanol Incentive E-10 GuidelineE-10 Guideline

– Effective 1/1/08Effective 1/1/08– All Highway gasoline motorfuel must contain 10% All Highway gasoline motorfuel must contain 10%

EthanolEthanol– CaveatsCaveats

If Ethanol is equal or less than cost of gasolineIf Ethanol is equal or less than cost of gasoline If Governor doesn’t waive for Air SIPIf Governor doesn’t waive for Air SIP

Increased FFV Target for State FleetIncreased FFV Target for State Fleet First FFV HybridFirst FFV Hybrid

Missouri Department of Natural Resources

E-10 GuidelineE-10 GuidelineEPA RVP IssueEPA RVP Issue

1lb RVP Waiver for >9% Ethanol1lb RVP Waiver for >9% Ethanol Legislation could provide a mechanism for wholesalers Legislation could provide a mechanism for wholesalers

to repeatedly switch between CG and E-10 over the to repeatedly switch between CG and E-10 over the course of a seasoncourse of a season

Issue Federal Clean Air Rules vs of mixed E-10 with CG Issue Federal Clean Air Rules vs of mixed E-10 with CG

in UST or AST’sin UST or AST’s

Missouri Department of Natural Resources

Ethanol Initiatives

Ethanol IncentiveEthanol Incentive E-10 GuidelineE-10 Guideline Increased FFV Target for State Increased FFV Target for State

FleetFleet– Current Fleet InventoryCurrent Fleet Inventory 35%35%

– Prior Statutory GoalPrior Statutory Goal 50%50%– 2007 Statutory Goal 2007 Statutory Goal 70%70%

First FFV HybridFirst FFV Hybrid

Missouri Department of Natural Resources

Ethanol Initiatives

Ethanol IncentiveEthanol Incentive E-10 GuidelineE-10 Guideline Increased FFV Target for State Increased FFV Target for State

FleetFleet First FFV HybridFirst FFV Hybrid

August 16, 2007August 16, 2007

Ford EscapeFord Escape

Missouri Department of Natural Resources

Ethanol Legislative Issues

Total of 10 bills introduced in the 2007 Wide Range of Topics

E-85 Infrastructure Tax Credit ($25K/25%)

Eliminating Cost Analysis for E-10 Guideline

Prohibition on Franchise Agreements limiting purchase/sale of E-85

Ethanol UpdateState of Missouri

presented to

Governors’ Ethanol Coalition

August 2007

Omaha, NB