Pacific Ethanol CEO Responds to EPA's Proposed Rules for 2014 Renewable Fuels
SACRAMENTO, Calif., Nov. 20, 2013 (GLOBE NEWSWIRE) -- Pacific Ethanol, Inc.
(Nasdaq:PEIX), the leading marketer and producer of low-carbon renewable fuels
in the Western United States, issued the following statement from Neil
Koehler, CEO, in response to the Environmental Protection Agency's (EPA)
recently proposed reductions to the 2014 Renewable Fuel Standard (RFS)
"The RFS is the single most effective energy policy this country has ever had
to reduce our dependence on foreign oil, develop renewable fuels as a
meaningful alternative to fossil fuels, and reduce carbon emissions from
transportation while boosting the economy and lowering the cost of gasoline to
consumers. Importantly, the policy is spurring innovation in new advanced
biofuels as substitutes for both gasoline and diesel. The renewable fuels
industry, with its existing infrastructure, stands ready to deliver the levels
of renewable fuels in 2014 set by the RFS.
The EPA proposes to use what we view as questionable regulatory discretion to
lower the 2014 renewable fuels targets. We believe that the EPA's proposed
ruling is incompatible with the already achievable objectives of the RFS and
will squander the opportunity to optimize the environmental, energy and
economic benefits of this valuable policy. The market for renewable fuels is
ready for continued growth. Seventy percent of the vehicles on the road today
have been approved by the EPA for the use of up to fifteen percent ethanol
blends. Additionally, over 15 million E85 vehicles are on the road today with
over 3,000 fueling stations offering E85 across the country. We and other
stakeholders will emphasize these points to the EPA during the comment period.
We hope the final rule will be revised to better reflect the intentions and
the promise of the RFS.
The ethanol industry remains on strong footing. A record corn harvest and
lower corn prices support the economics of ethanol production and blending.
Ethanol is the lowest cost transportation fuel in the world. Domestic demand
is strong and exports have increased significantly in recent weeks. Ethanol
production margins are currently at their highest levels for all of 2013. We
believe, regardless of the final EPA ruling, that the demand for ethanol will
remain strong in 2014 as the compelling economics of ethanol blending will
support a tight supply and demand balance, sustaining strong industry margins.
Pacific Ethanol benefits from California's Low-Carbon Fuel Standard (LCFS). We
expect similar standards in both Oregon and Washington. LCFS policies provide
an additional boost to Pacific Ethanol outside of the federal RFS. The LCFS
adds a premium price to the low carbon ethanol we produce and sell in
California and supports our efforts to expand production, diversify our
feedstocks and develop new technologies to further lower the carbon intensity
of ethanol we produce.
Pacific Ethanol has made significant strides this year: we strengthened our
balance sheet; reduced and extended all maturing debt and retired all but
$250,000 of our convertible debt financing; we increased our ownership
position in our production facilities, which enabled us to benefit from what
are currently the year's best production margins and produce positive
operating margins for the past two quarters; we introduced alternative,
lower-cost feedstocks such as beet sugar and sorghum, and created additional
revenue streams through corn oil production; and the LCFS is supporting
technology innovation in our plants, further advancing our competitive
position. We remain very optimistic about the company's future."
About Pacific Ethanol, Inc.
Pacific Ethanol, Inc. (Nasdaq:PEIX) is the leading marketer and producer of
low-carbon renewable fuels in the Western United States. Pacific Ethanol also
sells co-products, including wet distillers grain ("WDG"), a nutritious animal
feed. Serving integrated oil companies and gasoline marketers who blend
ethanol into gasoline, Pacific Ethanol provides transportation, storage and
delivery of ethanol through third-party service providers in the Western
United States, primarily in California, Arizona, Nevada, Utah, Oregon,
Colorado, Idaho and Washington. Pacific Ethanol has an 85% ownership interest
in New PE Holdco LLC, the owner of four ethanol production facilities. Pacific
Ethanol operates and manages the four ethanol production facilities, which
have a combined annual production capacity of 200 million gallons. The
facilities in operation are located in Boardman, Oregon, Burley, Idaho and
Stockton, California, and one idled facility is located in Madera, California.
The facilities are near their respective fuel and feed customers, offering
significant timing, transportation cost and logistical advantages. Pacific
Ethanol's subsidiary, Kinergy Marketing LLC, markets ethanol from Pacific
Ethanol's managed plants and from other third-party production facilities, and
another subsidiary, Pacific Ag. Products, LLC, markets WDG. For more
information please visit www.pacificethanol.net.
Safe Harbor Statement under the Private Securities Litigation Reform Act of
With the exception of historical information, the matters discussed in this
press release including, without limitation, the ability of Pacific Ethanol to
continue as the leading marketer and producer of low-carbon renewable fuels in
the Western United States; the effects of lower 2014 renewable fuels targets;
expected supply and demand for ethanol, and growth in the renewable fuels
industry; expected margins; and the anticipated enactment and effects of
legislation supporting low-carbon renewable fuels are forward-looking
statements and considerations that involve a number of risks and
uncertainties. The actual future results of Pacific Ethanol could differ from
those statements. Factors that could cause or contribute to such differences
include, but are not limited to, unexpected economic and market conditions;
changes in governmental regulations and policies; and other events, factors
and risks previously and from time to time disclosed in Pacific Ethanol's
filings with the Securities and Exchange Commission including, specifically,
those factors set forth in the "Risk Factors" section contained in Pacific
Ethanol's most recent Annual Report on Form 10-K filed with the Securities and
Exchange Commission on April 1, 2013.
CONTACT: Company IR Contact:
Pacific Ethanol, Inc.
IR Agency Contact:
Pacific Ethanol, Inc.
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