Domestic Fuel

One of the newest board members of the Ethanol Promotion and Information Council is a man of many hats. Ray Defenbaugh is the CEO of Big River Resources, a company that’s based in Southeast Iowa. The company already operates a one 100 million gallon ethanol plant and another is under construction.

But, Ray doesn’t just know ethanol production. He’s also quite the fiscally savvy farmer. Ray serves as chairman of the board for a $330 million bank.

That’s still not all. He serves as a director for the Renewable Fuels Association as well.

When asked about this latest “hat” though, Ray says ethanol possesses a “wide area of influence and effect.” He says the fuel is an excellent representation of value added agriculture, “bringing value right back into our Midwestern community right where it belongs.”

Chuck spoke with Ray at EPIC’s first annual meeting. You can listen to Chuck’s interview here:

epic-annual-mtg-defenbaugh.mp3

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The amount of biofuels being produced in the world will double between 2010 and 2030… and that represents a significant increase from previous U.S. government estimates of how much ethanol and biodiesel will be produced in the future.

This story from Reuters says a report from the U.S. Energy Information Administration says biofuels will be “an increasingly important source” of global energy supplies over the next two decades:

Global biofuels production will rise from 1.3 million barrels per day in 2010 to 2.7 million bpd in 2030, with the United States accounting for almost half that growth, EIA said in its new long-term forecast.

The boost will help renewable fuels take up about 8.5 percent of global energy use by 2030, up from about 7.7 percent in 2005, the EIA said.

The report goes on to say that U.S. biofuels output will grow from half a million barrels each day in 2010 to 1.2 million barrels each day in 2030.

A group of junior high students from Boise, Idaho has won first place in the National Fuel Cell Competition at the 2008 National Middle School Science Bowl in Golden, Colo.

This story from KBCI-TV in Boise says it was a good chance for the students to learn… and the sponsoring U.S. Department of Energy to get some new ideas:

“Each team started out with their motor and this fuel cell,” said eighth grader, Alex Baca, one of the master minds behind the design of the car. “And it was up to you to design some kind of car.”

The US Department of Energy sponsored this week’s National Middle School Science Bowl in Colorado, all in search, for creative ideas when it comes to researching alternative fuels.

One of the students’ mentors said while hydrogen may or may not be the answer to the nation’s energy problems… but they won’t know if it is the answer until they ask questions like this.

On May 25th, 2008, an F5 tornado ripped through the town of Parkersburg, Iowa… killing six people and practically wiping out the small town in Northeast Iowa. Now, with some help from biodiesel, the town is rebuilding.

This story from Biodiesel Magazine says the Iowa Renewable Fuels Association and the Ames, Iowa-based Renewable Energy Group Inc. have announced a $10,000 donation toward the purchase of biodiesel to aid the recovery effort. And that has turned into a statewide money-raising effort:

“The idea was to round the price of diesel up to $5 a gallon and ask people if they would like to donate just a gallon,” an REG representative told Biodiesel Magazine. “We have been overwhelmed by the participation in this fundraising activity.”

KCPS Radio in West Burlington, Iowa, donated $1,000 accumulated from listeners, and although the deadline for helping to purchase biodiesel has passed, persistence to help continues. “My sidekick and I raised the money from our listeners in just one week,” said Chip Giannettino, KCPS station owner and morning show host. “In fact, we’ll exceed $1,000 as donations are still drifting in.”

Western Dubuque Biodiesel in Farley, Iowa; and Central Iowa Energy in Newton, Iowa joined REG and the IRFA in making addiitonal $500 donations. GATX Rail and the Iowa Biodiesel Board were also noted donators among dozens of others.

Due to the current market volatility, VeraSun Energy will delay the startup of its 110 million-gallon-per-year ethanol production facility in Hankinson, N.D. This is the third VeraSun facility that has delayed startup operations this month due to market conditions, the other two being Welcome, Minn., and Hartley, Iowa. Construction on the Hankinson facility will be completed by the end of June, while construction on the Hartley and Welcome biorefineries was completed earlier this month.

VeraSun CEO Don Endres says ethanol is currently being sold at a deep discount to unleaded gasoline, which is tightening margins for producers, but he remains optimistic about the industry. “With oil prices hovering around record levels, there is a tremendous urgency for domestically produced fuel options in our country,” Endres said.

To wrap things up here at the Farm Foundation Transition To A Bio Economy conference I spoke with board member, Cornelius Gallagher. He says the conference brought together world class leaders who were able to listen to some fantastic presentations. I’ve posted interviews with almost all of them so please scroll back through them.

Corny, as he likes to be called, says that the conference accomplished what it was supposed to which is bringing leaders together to foster knowledge and provide attendees with a better understanding in a broad sense of the bio economy.

The next conference in the series will be held October 15-16 in St. Louis.

You can listen to my interview with Corny here: ff-bio-08-gallagher.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

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What we know and what we need to know was Peggy Caswell’s, USDA-ERS, topic here at the Farm Foundation Transition To A Bio Economy conference. She says we need to know things about how farmers or the providers of biofuels and feed stocks are going to have to change the way they do business. She used the example of having to look at different types of contracts and financing.

She said that ethanol companies are going to need a consistent and reliable source of product and that farming by nature is very variable. So farmers will be taking big risks and that’s why contracting will be necessary. She also calls for a lot more research, something we heard earlier in the program from other speakers.

You can listen to my interview with Peggy here: ff-bio-08-caswell.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

Podcast: Play in new window | Download (1.2MB)

We heard from Chevron here at the Transition To A Bio Economy conference since according to Paul Bryan, the company has made a major commitment to biofuels. He says they created a biofuels business unit about 2 years ago. Their focus is on 2nd generation biofuels that use non-food crops.

His talk focused on the integration in the biopetroleum business. He describes that as using bio-derived fuels that work with the existing petroleum infrastructure. One of the projects they’re involved with uses micro algae and he’s saying that it will be about 5 to 15 years before it’s in full volume production.

You can listen to my interview with Paul here: ff-bio-08-bryan.mp3

You can also download the interview using this link (mp3).

Post Update: Photo removed at Mr. Bryan’s request.

Transition To A Bio Economy Photo Album

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The issue of investment and financing for ethanol plants and bio refineries in general was addressed today by Chris Groobey, Baker & McKenzie, LLP. He works on project financing with investors and lenders and mostly in renewable fuels. He painted a pretty bleak picture.

In fact, he says the New York investment community is not interested in biofuels right now. He says they’re tapped out and that ethanol and biodiesel are not of interest to them at all. So with that being said, what’s next? He says there needs to be a combination of making more money from existing plants by co-locating other facilities or finding other sources of income from the same plant. He also thinks there needs to be more and bigger business structures.

He says this means we’re returning to more traditional models of rural development that take a longer term view. He recommends growing local agriculturally skilled management teams with people who understand farm risk.

You can listen to my interview with Chris here: ff-bio-08-groobey.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

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Our USDA Under Secretary for Research, Education and Economics is Gale Buchanan. He was here at the Transition To A Bio Economy conference to talk about the need for research in a growing bio economy. In fact, he sees a need for a tremendous amount of research to address the opportunities presented by the whole energy picture.

He also talked about how impressed he was at last week’s Bio Energy Awareness Days in Washington, DC where 35 different universities made presentations.

You can listen to my interview with Gale here: ff-bio-08-buchanan.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

Podcast: Play in new window | Download (1.3MB)

When it comes to infrastructure needs for a bio economy our rural road system is a key component. To speak about it here at the Transition To A Bio Economy conference we heard from Frank Dooley, Purdue University. He sees a big increase in grain production, primarily in the midwest. With that comes a growing demand for transportation. He thinks we should be concerned because most of the corn will be moved by truck and that’s going to impact rural roads. He also sees an increase in rail transportation but not significantly.

He’s worked on a project with the state department of transportation in Indiana to study traffic flow changes and suggests that more of this type of research needs to be done. He says that a 100 million gallon ethanol plant will have up to 110 trucks in per day.

You can listen to my interview with Frank here: ff-bio-08-dooley.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

Podcast: Play in new window | Download (1.5MB)

During our discussion on the infrastructure needs of a Transition To A Bio Economy, we heard from Paul Hammes, Union Pacific Railroad. Of course his focus was on rail infrastructure and as it relates to biofuels. Specifically, he spoke to the different pieces of that supply chain like rail cars, the rail network and unload/load capacity.

He says that the biofuels industry development happened quite quickly and that put some pressure on their network. In particular, it presented challenges at the destination markets for the unloading of ethanol. One of the challenges has been that ethanol is moved in small units and in concentrated areas. He see future challenges as developing rail infrastructure to meet capacity demands and more development at destination terminals.

You can listen to my interview with Paul here: ff-bio-08-hammes.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

Podcast: Play in new window | Download (1.2MB)

The opening speaker for day two of Farm Foundation’s Transition To A Bio Economy conference is our USDA Under Secretary for Rural Development, Thomas Dorr. He talked about rural policy and we visited for a while before the session got started.

He says that rural policy is more important and timely a topic now than it has ever been, especially as we’re coming off the finalization of the 2008 Farm Bill. Some reasons include the huge growth in the deployment of broadband internet access and the demand for food and energy. With growth in rural communities people are starting to think differently when it comes to policy issues like conservation.

He pointed out that 95 percent of all rural income is off farm and that there haven’t been any new jobs in agriculture in recent years. So he says we need to look at unique uses of local resources for development but that development creates demands on infrastructure like water and sewer. He says that by meeting goals of replacing oil with renewable energy sources we’re creating a significant rural investment opportunity. So the question he poses to communities is “Are they willing to step up?”

Dorr has a long history with the Farm Foundation since he was a member of the round table prior to his appointment in Washington, DC. He also talks about the Foundation’s rural development opportunity tours and one that’s planned for this summer in Europe where he’ll be participating in a farmer to farmer dialogue.

You can listen to my interview with Tom here: ff-bio-08-dorr.mp3

You can also download the interview using this link (mp3).

Transition To A Bio Economy Photo Album

Podcast: Play in new window | Download (4.5MB)

The Ethanol Promotion and Information Council has places to go if you ask the organization’s newly elected board president. Greg Kissek with Prairie Horizon Agri Energy says EPIC has come a long way, but there’s still much to accomplish.

Greg says he’s “looking forward to this year of opportunity” with EPIC.

Chuck spoke with Greg at EPIC’s first annual meeting. You can listen to Chuck’s interview here:

epic-annual-mtg-krissek.mp3

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Electric utility giant Consolidated Edison… Con Ed as it is affectionately known… announced today it will run more biodiesel in its vehicles.

This company press release from the utility giant serving more than three million customers in the New York City area has more:

Con Edison’s fleet of approximately 1,700 diesel trucks is using cleaner-burning B-20 biodiesel fuel, 20 percent of which is derived from soybeans. The soy-based portion of the fuel is a renewable resource that will help the company offset almost 400,000 gallons of petroleum per year. Newer diesel vehicles also will be equipped with special exhaust filters for even cleaner tailpipe emissions.

“Whether reducing greenhouse gas emissions from our own facilities, or promoting ‘green’ alternatives and energy savings tips with our customers, Con Edison has been a recognized industry leader in advocating for a cleaner, safer planet,” said Randolph S. Price, vice president for Environment, Health and Safety. “We are committed to mitigating climate change, and will continue to embrace new technologies and progressive corporate policies that embody our pursuit of environmental excellence.”

The story goes on to say that Con Ed is replacing 50 of its smaller vehicles with hybrids this year and working on the development of plug-in hybrid electric vehicles.