Distillers’ dried grains with solubles (DDGS) is a co-product of the dry-mill ethanol production. DDGS can be used as an alternative feedstuff in livestock and poultry rations. DDGS production has increased dramatically in recent years due to significantly higher production of ethanol in the United States. Ethanol production reached a record 15.14 billion gallons during the 2015/16 marketing year, compared to 14.66 billion gallons during the 2014/15 marketing year. This increase in ethanol production contributed to an increase of 35.7 million metric tons in DDGS production during the 2015/16 marketing year, as shown in Figure 1. DDGS production during the 2014/15 marketing year was 34.8 million metric tons.
The Iowa regulation of renewable fuels and energy contained in House File 2754 was approved in 2006 by the Iowa General Assembly. This regulation established the goal that 25 percent of all petroleum used in the formulation of gasoline in Iowa be replaced by biofuels by 2020. To help meet this goal, the Iowa Legislature authorized several tax credit incentives for biofuel retailers, including the Ethanol Promotion Tax Credit, the E85 Gasoline Promotion Tax Credit, the E15 Plus Gasoline Promotion Tax Credit, and the Biodiesel Blended Fuel Tax Credit (IDR, 2014).
The U.S. Government Accountability Office recently published a study on federal support for research and development related to advanced biofuels, and cited several factors that make it challenging to significantly increase production. The study highlights uncertainty created by government policy, including whether the Renewable Fuel Standards and federal tax credits...
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