Domestic Fuel

The US Secretaries of Energy and Agriculture each talked about the need for cellulosic ethanol in two different venues this week.

Energy Secretary Sam Bodman speaking at the Chicagoland Innovation Summit on Tuesday said ethanol is America’s best alternative energy source for the future, but researchers must develop a material other than corn to make it from. According to a Dow Jones report, “Eventually, we’re going to run out of the ability to make ethanol from corn,” Bodman told Dow Jones Newswires after the speech.

Meanwhile, Agriculture Secretary Mike Johanns was in Minnesota meeting “with state and local leaders Tuesday to talk up the emerging technology of cellulosic ethanol production – making ethanol from wood chips, corn stalks, alfalfa and other biomass types,” according to this Associated Press report. Johanns also said corn-based ethanol can’t meet the nation’s demand.

Hello from Iowa. I’m not up here for anything related to renewable fuels but when you’re a blogger you see things of interest everywhere.

I gassed up at a HyVee gas station and their higher octane gas containing ethanol was a lower price than regular. All the pumps have ethanol labels that promote the fuel additives benefits for cleaner air.

Ethanol is pretty much a daily topic of discussion on the “AgriTalk” radio show that airs on about 70 mostly Corn-belt area radio stations, as well it should be considering major sponsors of the program include ADM, Monsanto, VeraSun, and National Corn Growers. Here are a couple of recent programs:

Ethanol design company Fagen Inc. was a major sponsor of this year’s national cornhusking contest in Columbus, Neb. where Agri-Talk did a live broadcast on October 20, 2006.

Robert White, Director of Operations for the Ethanol Promotion and Information Council was a guest on Agri-Talk October 23 to discuss the new E85 equipment rulings.

The state of Nebraska is receiving $38 million from the USDA Rural Development agency for renewable energy and conservation, with most of the money to be used for an ethanol plant in McCook.

According to the McCook Daily Gazatte, the funding incudes a “$10 million Renewable Energy Systems Guaranteed loan and a $25 million Business and Industry Guaranteed loan to S.W. Energy, LLC.”

Additionally, $2.4 million in 9006 Renewable Energy and Energy Efficiency Improvements grants and a $300,000 Value-Added Producer grant were awarded to153 rural small businesses and agricultural producers to assist in areas of renewable energy resource development and energy efficiency improvements of existing systems.

Exactly one year from the day they broke ground, Mid-America Biofuels held a ribbon cutting ceremony for the opening of their 30 million gallon a year plant in Mexico, Missouri. Lots of good friends, like Senator Kit Bond pictured, were there to congratulate the nearly 400 agricultural producers who purchased shares in Biofuels, LLC and then formed a joint venture with Archer Daniels Midland Company; Ray-Carroll County Grain Growers, Inc.; MFA Oil Company; and Growmark, Inc.

Representatives of the Missouri Soybean Association were on hand to celebrate the grand opening of the plant that will use soybean oil to make diesel fuel.

“A year ago today, we came together to break ground for this facility. With the dedication and support of U.S. Senators Kit Bond and Jim Talent, Governor Matt Blunt and U.S. Congressman Kenny Hulshof, we’ve brought biodiesel in Missouri to the forefront of the nation’s industry,” said Dale R. Ludwig, executive director/CEO of MSA. “Missouri has a wonderful group of legislators who recognize the importance of renewable fuels. They’ve helped make the Mid-Am dream become reality.”

Heartland Energy Group Inc. of Louisiana is setting up the backyard still.

A press release from Heartland announces the receipt of ethanol production equipment from Dogwood Energy, LLC (see previous post).

Heartland Energy will exclusively sell and market Dogwood’s full line of ethanol stills and related ethanol products in the Louisiana territory. In addition, the agreement grants Heartland Energy, first option rights to the territories of Arkansas, Texas, and Oklahoma.

According to Heartland Energy Group under the agreement Flex Fuel America, Heartland Energy’s product sales and marketing subsidiary, will represent Dogwood’s full line of products including the home- and farm-based ethanol still, Bio-Diesel Production kit, and several ancillary alternative energy related products. Ethanol can be produced through a home-based distilling process utilizing ethanol stills. These stills enable the annual production of ten thousand gallons of ethanol for home-based stills and ten million gallons for larger commercial based stills.

ASTM International has released a new standard for biodiesel that will help ensure that biodiesel blends of up to 20 percent will be compatible with future diesel exhaust emissions technology.

A release from the National Biodiesel Board says the new standard, D 6751-06a, adds new limits on calcium and magnesium, which can be introduced during the biodiesel manufacturing process.

According to Steve Howell, National Biodiesel Board Technical Director and Chairman of the ASTM Task Force on biodiesel standards, “Engine manufacturers were concerned that even very small amounts of minor compounds could build up in particulate traps and eventually cause the traps to clog,” said Howell. “The new ASTM specification addresses these concerns and demonstrates the industry’s eagerness to work with manufacturers to ensure compatibility between the equipment and the fuel.”

Fall is bringing in a bumper crop of stories about ethanol earnings, corn prices and whether the gold rush is over.

Associated Press, NEW YORK — Makers of ethanol, an alternative fuel derived from corn, witnessed a third-quarter retreat from the strong industry conditions that characterized the second quarter: peak oil and ethanol prices, and rapid demand growth for ethanol as a gasoline additive.

Resource Investor Blog – As oil prices retreated, so did ethanol….

Zacks.com – Senior analyst Paul Cohen says the overall impetus for ethanol is strong and will continue to be strong.

Toledo Blade - Investing in ethanol was a high-octane activity this year, especially when the price of regular gasoline surpassed $3 a gallon. “There’s huge interest in ethanol,” said Charlie Rentschler, a 30-year agribusiness analyst now with Wall Street Access, a New York firm.

UPI – WASHINGTON — The rising cost of corn amid increased demand and sliding oil prices may hurt the burgeoning ethanol industry.

Forbes – Everything has been going right for ethanol, the corn-mash moonshine that began getting the country truly giddy earlier this year. But now that giddiness is gone.

Ethanol has become a campaign issue in many areas, with political candidates often trying to outdo each other in proving how supportive they are of domestic fuels.

Take Missouri, for example. This story from the Columbia Missourian reports: There’s consensus on ethanol among the candidates for state representative seats in two rural Missouri districts: It’s good for farmers, good for the country and good for the economy, they say, but there’s not much more the state can do — at least for now — to encourage its use.

In the Missouri Senate race, Republican incumbent Jim Talent and Democrat Claire McCaskill both say they support alternative fuels such as ethanol, but McCaskill has raised objections to last year’s federal energy legislation that includes a renewable fuels standard. Talent is a strong supporter of the RFS and was instrumental in getting it included in the final energy bill passed by Congress. Both have traded barbs in campaign ads over who has done more or less for the ethanol industry, with the McCaskill camp claiming Talent voted against ethanol for 18 years.

Kansas City-based Alternative Energy Sources Inc. has announced plans to build a 110-million-gallon ethanol plant in Greenville, Ill., 45 miles east of St. Louis.

According to a company release, this follows announcements in August that the company plans to build ethanol plants in Central Iowa and Northern Illinois.

American Ethanol has broken first ground on its way to a planned two billion gallons of annual ethanol production.

The Chicago-based company broke ground last week on the first of 15 planned 100+ gallon-per-year facilities in Nebraska and Illinois. Sutton, Nebraska was the site for the ceremony on Thursday, according to this story from the Lincoln Journal-Star. Another groundbreaking is expected shorly on a similar plant by the same company in Wahoo, Nebraska.

According to the American Ethanol website, they have three additional Nebraska sites in permitting, as well as four sites in Illinois in the permitting process, with six other Illinois sites currently under negotiation.

Reports from the Detroit Free Press about E85 pumps losing their safety rating from Underwriters Laboratory are causing quite a bit of confusion in the ethanol world.

Justin Hyde of the Free Press Washington Bureau followed up his first report yesterday with another one today giving further information, as well as an article in USA Today.

The initial report had no comment from UL, the nation’s largest product safety testing group, but today’s story quotes UL’s manager of consumer affairs John Drengenberg and says it was on October 5 that “the UL said it was suspending its listings for any fuel system that handles E85, a blend of 85% ethanol and 15% gasoline.”

The articles claim this “means that most of the roughly 1,000 stations that carry it likely violate fire codes. It also means that in most states, stations that want to install E85 pumps will need waivers from local or state fire marshals.”

Two stations in Columbus, Ohio have been closed so far, but each state has its own jurisdiction regarding safety approval ratings.

The story quotes Michelle Kautz, a spokeswoman for the National Ethanol Vehicle Coalition, as saying stores that offer E85, a blend of 85% ethanol and 15% gasoline, are “allowed to sell it until they’re told not to.”

Although there is no official information about the UL decision on the company’s website, UL reportedly said in a statement that it had no reports of problems with E85 systems, but withdrew its certification due to concerns about how ethanol can corrode parts of the fueling system. The issue concerns pumps that have been converted from regular gasoline with up to 15 percent ethanol additive, to up to 85 percent ethanol.

UL is reportedly moving quickly to examine the pumps for ethanol use and set new standards.

Illinois Farm Bureau is trying to get the good news about ethanol out in two ways – a new blog and some cute and corny TV spots posted on YouTube.

Illinois Farm Bureau News Service Director John Hawkins says they started the new ethanol blog “to provide the latest information on renewable energy and ethanol for Illinois Farm Bureau members. In the near future, we will include some IFB research on the renewable fuels issue, plus FarmWeek stories pertinent to energy issues.”

Today’s post on the blog is about the ethanol television spots that ILFB has produced.

One, called “Kids Say the Darndest Things,” has a bunch of cute little kids saying nice things about ethanol.

The other one features ethanol super hero Captain Cornelius, who has been around for years promoting corn. In this very “corny” 30-second spot he saves the world with the power of corn in ethanol to make us less dependent on foreign oil.

In terms of views, cute is beating corny with over 1800 views for “Kids” and less then 250 for “Capt. Corn.”

A new survey from the Biotechnology Industry Organization (BIO) shows strong support for government investment in biofuels research.

According to a press release:

Four in five U.S. adults (80%) strongly or somewhat agree that national and state governments are not doing enough to promote production of biofuels.

The survey, conducted by Harris Interactive®, also found that 82% of adults say national and state governments should provide financial incentives to biofuels producers to encourage the production and availability of biofuels. More than two out of three adults (69%) would use American-made biofuels even if these fuels cost slightly more than conventional gas. And more than eight of every 10 (84%) say they would be at least somewhat likely to support federal and state political candidates who favor providing incentives to promote increased production and availability of biofuels throughout the United States.

Not seeing much on this in the general media, but the farm media has stories out on it.

Public meetings are part of the process of bringing an ethanol plant to any community. Plans must be presented and concerns addressed.

Monona County Ethanol – a Midwest Ethanol Producers company – held two public meetings this week in the area where they plan to build a 100 million gallon per year facility. About 200 people attended the meetings held in Onawa and Blencoe, where the plant will be located. According to Midwest Ethanol CFO Kurt Bravo, the plant will provide 45 – 50 professional, skilled and semi-skilled employment opportunities, with compensation packages averaging $52,000.00 per year including benefits.

The Iowa plant is scheduled to break ground in January of 2007, with production slated for the 1st quarter of 2008. This is the fifth plant for Midwest Ethanol Producers – the other four are located in Nebraska.