$3.25 million to support Wisconsin's ethanol producers during pandemic

Grace Connatser
Wisconsin State Farmer
FILE - In this Feb. 4, 2020 photo, Governor Tony Evers addresses farmers at the Wisconsin Farm Bureau Ag Day at the Capitol at Monona Terrace in Madison.

After mass travel came to a near standstill in 2020, Governor Evers is allocating $3.25 million from the federal CARES Act to help the ethanol industry stay afloat in Wisconsin.

The funding is much needed after the industry nearly collapsed nationwide due to low sales of gasoline as less people drove to work and school and did not travel to visit family. Ethanol is also important for the production of dry ice by supplying carbon dioxide. Dry ice is critical to the successful delivery of some COVID-19 vaccines because of the need for extremely cold temperatures in order to keep the vaccines viable.

"I appreciate the efforts of Wisconsin’s ethanol industry to pivot and respond to the challenges presented by COVID-19," said Gov. Evers. "Ethanol production is extremely important to a number of supply chains in our state and will be especially critical as we finalize and implement our vaccine distribution plans. I’m proud to support our state’s ethanol producers and continue our commitment to innovation in biofuels."

The nine ethanol plants in Wisconsin together produce more than 530 million gallons a year, the Wisconsin State Journal reported last year, creating $4.2 billion in economic activity and supporting 19,000 jobs. A study by economists from Florida State University and Arizona State University found that ethanol producers lost at least $7.9 billion during the economic crisis of the pandemic.

RELATED: USDA announces at least $22M investment to increase US biofuel demand

RELATED: EPA sides with farmers on ethanol, rejects refinery waivers

"Prior to COVID-19, the United States produced approximately 16 billion gallons of ethanol per year, with five companies producing 45% of the total US ethanol production," the study stated. "COVID-19 has had a major impact on ethanol production, such that US ethanol sales in 2020 could fall by more than $10 billion."

The Wisconsin BioFuels Association commended the move, saying Wisconsin's ethanol plants lost nearly $25 million in the span of a single month, April, this year. While the demand for ethanol has somewhat recovered, it's still nowhere near what it was prior to the pandemic, creating a serious need for emergency aid.

"Governor Evers shows a deep understanding and appreciation of the wide-ranging importance of the ethanol industry on Wisconsin’s economy," said WBFA president Erik Huschitt. "This year has been a unique challenge to our industry, to say the least. We are proud of the ways our state’s ethanol plants have adapted in order to keep running during COVID-19. These grants will be extremely helpful as we continue our important work. The Governor’s actions are both applauded and appreciated."

The Wisconsin Department of Agriculture, Trade and Consumer Protection Secretary-designee Randy Romanski said the funds are much needed not only to support the ethanol industry, but to ensure the steadiness of other industries, too.

"Our state's ethanol industry suffered some significant losses," Romanski said. "Renewable energy in the form of biofuel and ethanol production is a critical part of other important industries in Wisconsin. ... The ethanol industry is also important to ... continued innovation."

The US Department of Agriculture has also invested $22 million into the ethanol industry so far, with several funding recipients from Wisconsin and more grants to come from a $100 million pool.