2026 Valero Report on Guiding Principles - Report - Page 6
Ethanol
Ethanol is a low-carbon, high-octane fuel. When used as a gasoline
blendstock, ethanol boosts the octane rating of the 昀椀nished fuel. Valero operates
12 ethanol plants located in the U.S. Midwest, with a combined production
capacity of 1.7 billion gallons per year. The plants are dry mill facilities that
process corn to produce ethanol and coproducts, such as dry distillers grains
(DDGs) for livestock feed and inedible corn oil.
Ethanol offers at
least 30% lower life
cycle GHG emissions,
compared with
petroleum gasoline.2
Fiber Cellulosic Ethanol
In addition to starch ethanol, we use an enzymatic process to convert waste 昀椀bers into cellulosic ethanol, a secondgeneration fuel.
"When [cellulosic ethanol is] used as a vehicle
fuel, it can support deep reductions in [life
cycle] greenhouse gas emissions, with a carbon
footprint 73% smaller than conventional gasoline."5
Compared to gasoline’s CI of approximately
100 gCO2e/MJ and EV's average CI of about 50
gCO2e/MJ (depending upon battery components,
manufacturing place and the electric grid), 4 cellulosic
ethanol has a CI in the high 20s.5 When combined with
carbon sequestration, the cellulosic ethanol product
can have a CI in the single digits, further increasing
the value of ethanol in low-carbon markets.
Carbon Capture and Storage (CCS)
CCS is a proven technology that has been in commercial use for decades in the oil and gas and fertilizer industries. It
involves three steps:
1. Capture: CO2 is separated from other gases produced at industrial process facilities or in the atmosphere.
2. Transport: Separated CO2 is compressed and transported by pipeline, rail, trucks or ships for storage.
3. Storage: CO2 is injected into deep underground geological formations for permanent storage.
Industrial Carbon Capture. A Valero provider of hydrogen operates a large-scale system to capture CO2 from its two
steam methane reformers located within the Valero Port Arthur Re昀椀nery. Recognized by the Department of Energy, this
industrial CCS project was the 昀椀rst-of-its-kind operating at such a industrial large scale by capturing approximately
1 million metric tons of CO2 per year.
Ethanol Carbon Capture and Storage. Currently, we are developing stand-alone CCS projects at several of our
eastern ethanol plants, potentially capturing more than 1 million metric tons of CO2 a year. Certain of our ethanol
plants are located near geology believed to be suitable for successful CCS projects, making them potentially
attractive for development.
Low-Carbon Fuels — Frequently Asked Questions
What is carbon intensity or CI? CI means the quantity of life cycle GHG emissions for a particular fuel per unit of
transportation energy delivered, which is expressed in grams of carbon dioxide equivalent per megajoule (gCO2e/MJ).
Where are feedstocks sourced to produce low-carbon fuels? Our ethanol and renewable diesel plants are in
advantaged locations. In the case of ethanol, the U.S. Midwest, where Valero ethanol plants are located, offers abundant
corn supply. In addition, Valero has built existing logistics assets well positioned to support export growth of ethanol. Our
renewable diesel and neat SAF production are competitively located in the U.S. Gulf Coast with access to domestic and
global feedstocks, which allows for 昀氀exibility of supply of used cooking oil, animal fats, soybean oil and inedible corn
oil. Used cooking oil and animal fats are sourced domestically and internationally. Notably, the other member of our
renewable diesel joint venture6 is the largest renderer in North America and globally, which provides a source of used
cooking oil and animal fats. Inedible corn oil is sourced from Valero’s ethanol plants in the U.S. Midwest.
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