Domestic Fuel

Rains and flooding kept farmers in the Midwest corn and soybean belts out of their fields for a long time this spring. But according to a new report from the USDA, the actual stockpiles of the main feedstocks for ethanol and biodiesel are higher than expected.

This story in Forbes says the U.S. has a 30-day stockpile of soybeans… a relief for biodiesel producers who have been worried what a tight supply could do to their industry:

A survey of farmers and warehouses pegged the stockpile at 205 million bushels on Sept. 1, compared with the U.S. Agriculture Department’s Sept. 12 forecast of 140 million bushels or a three-week supply.

In a pair of reports, USDA said the corn and wheat stockpiles were larger than a year ago. This year’s wheat crop totaled 2.5 billion bushels, up 2 percent from its previous report and the largest wheat crop in a decade.

Corn and soybean prices on the Chicago Board of Trade fell on the news… once again, good news for the ethanol and biodiesel industries… with November beans down 25 cents at $10.69 a bushel and Decemmber corn off six-and-a-half cents at $5.06-3/4.

As lawmakers wrestle over a bailout for Wall Street, some renewable energy producers on Main Street are wondering if they’ll at least get an extension of some valuable tax credits.

This story from Agriculture Online quotes Senator Chuck Grassley, the ranking Republican on the Senate Finance Committee, as saying that if Congress adjourns without passing a tax relief bill, it would be a catastrophe because of how reliant wind and biodiesl are on their tax breaks:

The tax bill, which also would prevent more Americans from being caught by the Alternative Minimum Tax when they file next April, contained several alternative energy tax breaks championed by Grassley. It extended a tax credit for wind energy through 2009, as well as a $1-per-gallon tax credit for biodiesel.

Grassley said he wasn’t certain what the effect of not extending alternative energy tax credits beyond the end of this year would be. In 2004, a similar delay in extending the tax credits for wind shut down that industry for six months, he said, adding that he believes the industry is stronger today.

Grassley says he doesn’t think Congressmen will want to go home and face constituents who would now have to pay the Alternative Minimum Tax. About 23 million people would have to pay the AMT… as much as an extra $2,000 in the tax bills for those who make less than $200,000.

According to the American Lung Association of Iowa, September has proven to be THE month for ethanol blended fuels! The state held several successful events promoting the domestically grown fuel.

“We would like to welcome our first three blender pumps to the state of Iowa: Galva Holstein in Galva, Unity Biofuels in Olds, and Popkes in Rock Rapids,” noted Jessica Zopf of the Iowa Clean Air Choice Team. “Collectively these pumps offer E10, E15, E20, E30, and E85. A big thanks goes to the Department of Agriculture for attending and showing their support for cleaner-burning fuels! A special thanks also goes to Kum & Go for their commitment to offering renewable fuels with their 17th E85 location in Iowa.”

Following is a run down of the events the past month:

Sept. 3rd: Kum & Go Ground Breaking, Johnston, IA for E85 site
Sept. 5th: Unity Biofuels, Olds, IA pumped 600 gallons of ethanol-blended fuel
Sept. 6th: Green Fair, Urbandale, IA with Bob Brown Chevrolet
Sept. 8-9th: Biobased Industry Outlook Conference Display, Ames, IA
Sept. 10th: Kum & Go, Urbandale, IA pumped 1150 gallons of E85
Sept. 12th: Popkes, Rock Rapids, IA pumped approximately 600 gallons of ethanol-blended fuel
Sept. 15th: Farmer’s Coop, Forest City, IA pumped 1000 gallons of E85
Sept. 17th: Galva Holstein, Galva, IA pumped 1335 gallons of ethanol-blended fuel

October also looks to be a busy month in the state of Iowa.

A research service for the chemical industry say that the U.S. is poised to be the world leader in biodiesel consumption by 2012.

According to a press release posted on MarketWatch.com, SRI Consulting has published its Global 2008 Biodiesel Report, which says Americans will consume nearly one-fifth of all the world’s biodiesel by 2012… a dramatic turnaround from being a distant second to Europe just a few years ago:

A slower pace of growth is projected for the global biodiesel industry due to market uncertainties: ongoing fuels versus food debate, rising raw material costs, changing regulatory environment, a slowing global economy and the current financial crisis.

An important development over the last several years has been the shift in global biodiesel patterns. Only five years ago Europe was a dominant player, with 83% of capacity. By 2007 the European share had declined to about 46% as North America and Asia grew to 23% and 19% respectively.

The release goes on to say that the future success of the biodiesel industry will rely on political support and incentives.

You can read the entire report by clicking here.

A recent report clearly illustrates the energy improvements being made at ethanol biorefineries across country.

According to the report by John Christianson, CPA of the independent accounting firm Christianson & Associates, the average amount of energy as measured by British Thermal Units (BTUs) required to produce ethanol and a livestock feed co-product across all ethanol production technologies was reduced by 13.5 percent between 2004 and 2007.

The most efficient biorefineries demonstrated an even more dramatic reduction 19 percent reduction in BTU energy requirements, today using fewer than 21,000 BTUs per gallon of ethanol produced. In addition, electricity usage at ethanol biorefineries also declined. The Christianson report shows a 13% reduction in electricity consumption at the average ethanol facility.

Read the entire report here.

The Nebraska Ethanol Board, in cooperation with the University of Nebraska Center for Energy Science Research, is hosting a policy forum in October to discuss issues of rising energy and food prices.

The forum will provide an opportunity for Nebraska policymakers and consumers to better understand how ethanol policy plays a role in economic development, energy security, agriculture and the environment.

The Nebraska Ethanol Board is inviting presentations from a diverse group of people, including corn growers, restaurant owners and livestock feeders. Confirmed presenters include Dr. Ken Cassman of the University of Nebraska-Lincoln, Dr. Terry Klopfenstein of UN-L, Michael Kelsey of the Nebraska Cattlemen, Jon Holzfaster of the Nebraska Corn Board, and Jim Jenkins, rancher, restaurateur and chairman of the Nebraska Ethanol Board.

The forum is scheduled for Friday, October 24 at 9 a.m. at the Scott Conference Center in Omaha.

Algae has traditionally been a nuisance to catfish farmers, but it could end up being a new source of income for them and a new source of energy for the southeast.

Ron Putt, an associate research professor at Auburn University, has been studying the feasibility of using algae from catfish farms for biodiesel production. “Currently I have a small project that is going to demonstrate the ability to harvest algae from the catfish ponds in the western part of Alabama,” Putt says. “I see them as the core of the algae farming industry throughout the southeast. My goal is to turn the southeast conference into the new OPEC.”

He says catfish farmers have embraced the idea that believes could help the catfish industry which has been struggling with lower priced imports and high feed costs.

Randall Weiseman of Southeast Agnet interviewed Ron Putt at the recent Northwest Florida Bioenergy Conference and Expo. Listen to that interview here: john-harper.mp3

Podcast: Play in new window | Download (734.7KB)

Farmers on the panhandle of Florida can now make their own biodiesel on the farm with the help of the Three Rivers Resource Conservation and Development Council (RC&D) in Milton through USDA’s Natural Resources Conservation Service.

The council recently invested in a portable biodiesel extruder that can be taken out to local farms to make biodiesel from plants and used cooking oil, according to Coordinator John Harper.

“We relied on the knowledge of one of our county commissioners who is an expert in biodiesel processes. We work with our farmers and show them how to get into biodiesel production for themselves,” Harper said. The washing machine-sized processor can produce 100 gallons of biodiesel in ten hours and can easily transported to a farm.

The extruder has been out for demonstrations around the panhandle area in recent months, including a bioenergy workshop held September 19 at the first annual Northwest Florida Bioenergy Conference and Expo.

Randall Weiseman of Southeast Agnet interviewed John Harper at that event. Listen to that interview here: john-harper.mp3

Podcast: Play in new window | Download (734.7KB)

California Governor Arnold Schwarzenegger is reducing the fees his state slaps on people who collect some of the raw materials to make biodiesel for their own personal use.

This story on the Best Syndication web site says The Gubernator signed a bill by Assemblyman Anthony Adams (R-Hesperia) to cut those fees:

“By reducing fees to use biodiesel fuels, more Californians will be encouraged to explore green technologies as a means of clean, safe, alternative energy,” said Adams. “The use of biodiesel fuel can help improve air quality for all Californians and decrease our dependency on foreign oil.”

Current law requires a $100 registration fee and a $300 enforcement fee per vehicle to transport inedible kitchen oil, which is used to make biodiesel fuel. These fees reduce the incentive for individuals to obtain a license to collect the inedible oil.

The measure reduces the fee for individuals to $75. The law goes into affect on January 1, 2009.

A gas crisis is striking the area of Georgia around Atlanta. With the recent spate of hurricanes and storms knocking out the Gulf Coast’s and Southeast U.S.’s refining of non-renewable petroleum, drivers are finding a shortage of fuel in the region.

But this story in the Atlanta Journal-Constitution says some enterprising Atlantans and other people from across the country are discovering the beauty of alternatives, in particular, biodiesel:

Driven to help the environment, or their own pocketbooks, many Atlantans are seeking alternatives to the gasoline habit. The most adventurous, like [East Cobb resident John] Knop, retrofit their diesel engines to run on waste oil from restaurants, picking up free fuel while their friends wait hours in line and pay through the nose…

These and other concerns prompted former veggie-oil driver Rob Del Bueno to begin brewing his own biodiesel, a product created by using methanol to chemically alter vegetable oil. Del Bueno soon learned that home-brewing fuel also was illegal, for a variety of reasons, and he went through the complex, and expensive, process of going legit.

The article goes on to say that Del Bueno joined the National Biodiesel Board and the Southern Alliance for Clean Energy and had his fuel certified. Now, he sells a quarter million gallons of biodiesel a year with plans to expand into Tennessee and Illinois.

Twelve feet of water can do a lot of damage… just ask the folks at GreenHunter Energy. Their biodiesel refinery in Houston had just opened this summer has been knocked out of commission when the eye of Hurricane Ike passed nearly directly over the facility.

GreenHunter officials are providing an update (along with pictures of the damage) that caused a number of storage tanks to float and ruined some of their feedstocks and chemicals, as well as tearing up electrical equipment, pumps and motors. The good news is: they have insurance:

Fortunately, the Company anticipates that most of the damage sustained by its wholly-owned subsidiary, GreenHunter BioFuels, Inc., will be covered by existing property and casualty insurance along with business interruption insurance. Insurance adjustors for the Company and underwriters have been at the refinery and are daily assisting management in preparing our claims. While our personnel continue to find damage caused by the storm, it is currently estimated that total damages are approximately $22.4 million.

Through the immediate and tireless efforts of our staff and management team, the refinery has been substantially cleaned of layers of mud, spilled materials, and debris from the flood. Repairs were commenced within one week of Hurricane Ike’s landfall strike. Major mechanical and operational components of the refinery remain intact. The receipt and installation of necessary electrical components from third parties is the primary reason for delay in restarting operations. It is anticipated that the U.S. Coast Guard will approve our barge docking facilities for resumption of operations, enabling the Company to begin moving products and feedstock early this week. The Company continues on target to meet the estimate of resumption of operations on or before October 31, 2008.

In an effort to keep their customers and shareholders updated, GreenHunter has posted video and pictures of the damage on its web site: http://greenhunterenergy.com/HurricaneIkeDamage.html.

Although the National Alternative Fuel Vehicle Odyssey Day is officially October 3, 2008, the St. Louis Clean Cities Coalition held an event on September 27, which brought awareness to E85, flexible fuel vehicles (FFVs), and other alternative fuels.

St. Louis Clean Cities held its Odyssey Day during the Green Homes & Renewable Energy Festival on September 27th, well over 100 booths showed off there “Green” products and services to several thousand visitors. Clean Cities had 12 different truck and vehicles on display,” noted St. Louis Clean Cities Coordinator, Kevin Herdler. An FFV Jeep was displayed during the event.

The AFV Day Odyssey was formed through the U.S. Department of Energy to promote energy independence.

Many additional Odyssey Day events will be occurring this week nationwide. For more information on these events, go to www.NationalAFVDayOdyssey.org.

A summit was held last week in Chicago to address the role of seed technology in meeting the growing demand for food, feed, fiber and fuel.

The goal of the American Seed Research Summit was to bring together research leaders from industry, academia and government to identify major seed research challenges and to develop a national strategy and action plan to solve those challenges.

Sponsored by the American Seed Trade Association (ASTA), the American Seed Research Foundation and the National Council of Commercial Plant Breeders, over 40 representatives were in attendance at the two-day summit. Keynote speakers included representatives of USDA’s Agricultural Research Service, the University of Wisconsin, Pioneer Hi-bred International and Monsanto.

The largest ethanol producer in the world just keeps getting bigger.

POET is scheduled to open two more ethanol plants in the next four weeks – both in Ohio. That will bring the total number of POET plants to 26 as of October 24, with a total capacity of 1.54 billion gallons per year.

The grand opening for POET Biorefining – Fostoria will be held September 30 featuring Buckeye Renewable Fuels Association Executive Director Mike Wagner, Ohio Department of Agriculture Director Robert Boggs, Ohio Congressman Bob Latta, and Team Ethanol Indy car driver Ryan Hunter-Reay.

POET Biorefining – Marion will open on October 24 with special guests U.S. Senators George Voinovich (R-OH) and Sherrod Brown (D-OH). This will be POET’s third plant in Ohio.

The Cenex E85 fueling location at 1160 W. Divide Avenue in Bismarck, North Dakota will be celebrating National Alternative Fuel Odyssey Day on October 2. The station will offer E85 for 85 cents a gallon from 4 – 7 p.m. The National Alternative Fuel Odyssey Day is an event that will be celebrated across the country recognizing cleaner-burning alternatives to traditional fuels.

“What I like about this national event is that it is not an attack on the petroleum industry, which is very important to our state and our nation, but rather a celebration of some of the new clean air choice options available to drivers today,” said Valerie Kummer, coordinator of the Red River Valley Clean Cities Coalition. “Even oil company executives are now saying America needs more fuel diversity, and North Dakota-made biofuels can help us offer more choices at the pump that help to reduce air pollution.”

This event is being sponsored by Cenex, Blue Flint Ethanol, General Motors Corporation, North Dakota Corn Growers Association, North Dakota Department of Commerce, North Dakota Ethanol Producers Association, National Ethanol Vehicle Coalition, US Department of Energy-Clean Cities and the American Lung Association of North Dakota.

There are currently about 29,000 flexible fuel vehicles and 27 E85 stations in the state of North Dakota.