Domestic Fuel

My eyes are still a bit fuzzy from all the reading I did last week so last night in honor of all of those snowed in in the Midwest, I watched a documentary – Gas Hole. As the title indicates, this movie is about America’s dependence on oil. Beginning in the 1970s during the first oil crisis to now, it details our country’s attempts to unsuccessfully shed itself of its addiction to foreign oil.

It baffles my mind, as I’m sure it does your mind, that with all our alternatives and technology, we can’t seem to make any headway towards a country not dependent on fossil fuel based energy. “We do not have a national energy policy that fits the 21st century,” said Rep. Anna Eshoo, D-California.

The movie is ripe with conspiracy theories as told by politicians, celebrities, alternative energy enthusiasts and witnesses. One of the main threads of the film is the invention of the “Oglemobile,” a car that could achieve nearly 100 miles per gallon (mpg) on vapor. The inventor was a man by the name of Tom Ogle who lived in El Paso, Texas. This feat was achieved in 1977. Ultimately he sold the patent, was told he could never produce another vehicle using the technology, and then died shortly thereafter under mysterious circumstances.

According to the movie, Shell was behind another of the conspiracies to keep fuel economy technology out of the marketplace. A former shell researcher noted that fuel economy testing began in 1939 with a car that could achieve 40-50 mpg and by 1977 and broken the 1,000 mpg barrier. The narration asks, “What have we been doing while scientists have been getting 1,000 miles per gallon?”

That is a good question. Although this movie is a little slow-moving, for those people who want to know the answer to the posed question, this is a film to be reckoned with.

I’ll leave you with the words of Eshoo, “It’s not enough to say something. We have to do something.”

Good news for a Steamboat Rock, Iowa ethanol plant! As a follow-up post from last week, the bankruptcy court has authorized a Plan of Reorganization of Pine Lake Ethanol Corn Processors and will allow Prairie Land Cooperative to take ownership of the plant.

Last month, the ethanol plant prepared this Plan of Reorganization that and was approved by their creditors last Friday. According to Pine Lake’s press release, the creditor Prairie Land Cooperative will take equity in the plant in lieu of a payment which totaled more than $14 million dollars. Prairie Land Cooperative will own approximately 85% of the reorganized company. Subsequent negotiations with the plant’s secured lenders, its largest unsecured creditor and its ethanol marketing company, resulted in a consensual plan, with all classes who were entitled to vote approving the Plan by the confirmation hearing. Pursuant to these negotiations, Pine Lake’s secured lenders agreed to a restructuring of their debt, which totaled approximately $14.5 million dollars. The smallest creditors will be paid in full and the remaining creditors will be paid thirty cents to the dollar over the next five years.

Pine Lake filed Chapter 11 Bankrupcy just one year ago. Scott Zabler, General Manager, stated, “We are very pleased that we were able to turn the plant around in exactly one year and are very optimistic that with the terms worked out with our major lenders that the plant will be profitable and on a solid financial footing. I am especially proud of our employees who stood by us through some grim months in 2008 and pitched together to make this turnaround a success.”

The turnover in ownership will take place on December 23, 2009.

Novozymes and PRAJ Industries Ltd have signed a contract to collaborate on the development of advanced biofuels. Together the two companies will optimize the enzymatic hydrolysis processes and use of enzymes in the production of advanced biofuels. The two companies have a history or working together and for several years have been focusing on conventional biofuels.

According to Novozymes, India and other countries that have been working to develop and deploy biofuel will see clear benefits – from job creation in rural areas to improved energy security. And the world as a whole will benefit from significantly reduced CO2 emissions in the transport sector, which is currently the second-largest and fastest growing source of CO2 emissions.

The collaboration agreement was signed in Copenhagen by Pramod Chaudhari, Chairman of PRAJ, and Steen Riisgaard, President & CEO of Novozymes A/S, to mark the Climate Change Summit in Copenhagen. On Monday, Novozymes announced that 150 VIP limos were running on ethanol produced from straw.

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A new study shows that world biofuels production in 2009 has reduced GHG emissions by 123.5 million tons. The figure represents an average reduction of 57 percent compared to the emissions that would have occurred from the production and use of equal quantities of petroleum fuels. The report was prepared by (S&T)² Consultants Inc.

Bliss Baker, spokesperson for the Global Renewable Fuels Alliance who commissioned the report noted, “This landmark report proves yet again that biofuels production and use is already playing a vital, yet too often overlooked, role in reducing harmful GHG emissions around the globe. In light of the ongoing United Nations Framework Convention on Climate Change Conference in Copenhagen, today’s report is evidence that biofuels are and must continue to be on the front line of the Climate Change fight.”

The report also discovered that worldwide biofuels produced in 2009 is displacing 1.15 million barrels of crude oil per day, which creates around 215 million tonnes of GHG emissions annually. In addition, worldwide production of approximately 19 billion gallons reduces GHG emissions by 87.6 million tons.

Forecasted global production of biodiesel of approximately 4 billion gallons will reduce GHG emissions by 35.9 million tons. When you combine the worldwide production numbers of both ethanol and biodiesel, the fuels are estimated to reduced GHG emissions by 123.5 million tons.

The study utilized a “life cycle assessment” (LCA) approach to estimate global GHG emissions reduction achieved through the production and use of biofuels from “cradle-to-grave”, including the acquisition of raw materials, manufacture, transport, use, maintenance and final disposal. You can download the full report here.

The nation’s biggest biodiesel is making a student’s Christmas a bit greener.

HERO BX has awarded Erie, Pa. native Katherine Tarr, a $1,000 scholarship. This company press release says the award was given in conjunction with the Erie movie premier of the Sundance Film Festival award winning film, FUEL:

“I’m really grateful for the scholarship,” said Tarr, who will graduate from Gannon University next spring with a Masters of Education in Curriculum and Instruction. She noted that the film had a major impact on her, especially as an educator. “It’s interesting. I’m in education and didn’t realize that you could put biodiesel in your car if you have a diesel engine. This just demonstrates the need for more information, especially targeted at students. I don’t think they realize we’re running out of fossil fuels and I want to be able to tell my students that biodiesel is an available option.”

“HERO BX is on the forefront of developing new technologies to efficiently and affordably produce biofuels,” said Leonard Kosar, HERO BX CEO. “Having team members trained for these types of green jobs is an essential component of HERO BX’s success and to the success of our country’s efforts to become energy secure and sustainable. That is why we understand that supporting educational efforts are critical.”

Tarr says she’s considering a diesel as her next car so she can fill the tank with locally produced biodiesel.

It’s never too early to start planning your 2010 conference schedule and here is one to consider: World Biofuels Markets. This is Europe’s largest biofuels conference and so far, 20 of the 50 companies who were named to Biofuels Digest’s “Top 50 Hottest Companies in Bioenergy” will be participating.

Last year several hundred people were on hand and this year more even more are expected due to the recent policies passed in the U.S. including the announcement on Monday that the EPA has designated greenhouse gas pollution as a threat to society.

In part, the conference will consist of a series of focused sessions that cover topics from energy crops, to algae fuels, biofuels for aviation, policy, sustainability, biofuels from waste, and more. More than 200 people will be presenting during the conference. Keynote speakers include:

• • Dr. Gro Harlem Brundtland, former Prime Minister of Norway, former Head of the World Health Organisation
  • Nobuo Tanaka, Executive Director, International Energy Agency
  • Philip New, Chief Executive Officer, BP Biofuels
  • Jan Ernst de Groot, Managing Director, KLM Royal Dutch Airlines
  • Suani Coelho, Executive Director, CENBIO, UN Advisory Group on Energy and Climate Change & IRENA
  • Karl Watkin, MBE, Bioenergy Pioneer & Founder, D1 Oils & former Chair Bioenergy Advisory Board, UN Foundation
  • Peder Holk, Nielsen, Executive Vice President, Novozymes
  • Andrew Owens, Chief Executive Officer, Greenergy

Registrations incentives are available. Click here for more information about the World Biofuels Markets conference.

The biotech industry would like you to become ‘biotech’. Biotechnology has been responsible for bringing many things to the world including vaccines, cures for cancers, and better ways to grow our food. It is also responsible for developing the natural enzymes that are being used to help spur the growth in the biofuels industry. Enzymes are better for the environment, more efficient and help to lower the costs of producing biofuels, this according to an Industrial Enzymes video segment I just watched that featured the biofuels work of Novozymes. Apparently, this is to be a topic of interest during the Copenhagen Climate Conference.

Today, the Biotechnology Industry Association is asking people to join their “I Am Biotech” movement.  If you join the online biotech community, you will be entered for a chance to win free roundtrip airfare and a complimentary registration to the 2010 BIO International Convention in Chicago.

The site offers insights on the direction of the industry from top CEO’s and thought leaders, networking opportunities, legislative updates, research updates and more. To learn more go to: www.IAmBiotech.org/join.

A broad coalition of companies and organizations have signed on to a letter asking Congressional tax writers to fix a program intended to promote the installation of fuel pumps that dispense mid- and high-level ethanol blends.

Growth Energy CEO Tom Buis sent the letter to the chairmen and ranking members of the Senate Finance Committee and the House Ways and Means Committee, along with the support of 152 companies and organizations, from ethanol plants to public policy advocates. The coalition includes ethanol and clean air organizations, state and national agricultural groups, petroleum marketers, and manufacturing companies.

The letter requests that Congress adopt a technical amendment that would direct the Internal Revenue Service to allow petroleum retailers to receive tax credits up to $50,000, or 50 percent of the total cost of installing alternative fuel dispensing systems, such as ethanol blender pumps. An earlier IRS decision left retailers unable to take the full tax credit.

“When Congress passed the tax credit, it was to ensure support for installing pumps that carry renewable, sustainable fuels like ethanol. But this IRS interpretation is blocking petroleum retailers from obtaining the full amount they are due, as intended by Congress,” Buis said. “Today we have the support of 152 separate groups and organizations from around the country, stating they agree with Growth Energy that Congress should fix the tax credit so IRS will administer the tax credit as intended.”

Read the letter here.

According to a new report by the National Biodiesel Board that studies the positive effect of the tax credit, “The ailing U.S. biodiesel industry is producing at 15% of its potential capacity.” It argues that if the federal government does not extend the tax credit, set to expire on Dec. 31, 2009, the entire industry could “cease altogether.” This year, U.S. biodiesel numbers are expected to drop 31% to 475 million gallons.

But amid the industry uncertainty, some good news. Good Energy, Inc., based in Magnolia, Ohio, has opened their G2 Diesel plant. The plant has the capacity of 16,500,000 gallons per year. G2 Diesel is 11 Good’s proprietary fuel made from nearly 99% natural and renewable ingredients. G2 Diesel is primarily made from a blend of soybean oil and ethanol. According to the company, G2 Diesel has shown an increase in fuel efficiency and horsepower, while lower emissions and maintenance costs and can be used in conjunction with #2 diesel in any diesel engine application.

“We are very pleased with the progress of our company as we accomplish this major milestone,” said 11 Good’s CEO, Frederick C. Berndt. “This will allow our company to serve our current customer base as well as allow our fuel to be tested and integrated throughout North America.

ASTM International has honored a long time ethanol industry expert with its Award of Excellence.

Robert Reynolds of Downstream Alternatives received the award for his “outstanding and dedicated contributions to fuel standards development and as a consensus builder within ASTM between ethanol and petroleum interests.”

Reynolds, pictured here at the 2007 National Ethanol Conference, was a founding member of the Renewable Fuels Association (RFA) Technical Committee and is the author of the most widely used technical reference materials for fuel ethanol today, the Changes in Gasoline manual series and the Fuel Ethanol Industry Guidelines.

“For more than three decades, Bob Reynolds has served this industry extremely well, bringing an immense amount of technical fuel expertise to an ever- evolving industry,” said RFA President and CEO, Bob Dinneen. “Ethanol wouldn’t have the excellent reputation for quality in the fuel industry without him, nor would it have gained the widespread acceptance and use it enjoys today.”

It was a busy day in Washington yesterday as U.S. Secretary Steven Chu announced the issue of a final rule for the Loan Guarantee Program. The revised rule was designed to increase participation from private investors and banks as well as to support more innovative energy technologies. This announcement came on the same day that Chu released another $100 million for a second round of ARPA-E funding.

*Photo Credit The Cayman Institute

“This much needed change will provide greater flexibility to the Loan Guarantee Program and help us to support more projects at a better value to taxpayers,” said Secretary Chu. “This is part of our commitment to ensuring businesses are able to access the support they need to create jobs and contribute to a clean energy economy.”

The new rules came as a result of more than 2,100 comments from interested parties during the 30-day comment period. Under the updated rule, the Loan Guarantee Program will be able to consider financing project in conjunction with other lenders as well as provide loan guarantees to projects with multiple stakeholders.

Copies of the proposed rule will be available from the Department’s Loan Guarantee Program at www.lgprogram.energy.gov.

U.S. Energy Secretary Steven Chu announced today an additional $100 million round of funding opportunities for transformational energy research projects that will be made available through the Advanced Research Projects Agency-Energy (ARPA-E). This announcement was made along side Commerce Secretary Gary Locke in advance of the Copenhagen Climate Conference.

In a statement, Chu said, “I am pleased to announce ARPA-E’s second funding opportunity because it demonstrates our commitment to lead the next Industrial Revolution in clean energy technologies, creating thousands of new jobs while helping cut carbon pollution,” said Secretary Chu. “This solicitation focuses on three cutting-edge technology areas which could have a transformational impact.”

Unlike the last round which focused on supporting projects such as biofuels, carbon capture, renewable power vehicles and more, this round will focus on three key areas: new approaches for biofuels, carbon capture and batteries for electric vehicles.

In a new category coined electrofuels, “ARPA-E is seeking new ways to make liquid transportation fuels – without using petroleum or biomass – by using microorganisms to harness chemical or electrical energy to convert carbon dioxide into liquid fuels.” More specifically, they are looking at funding projects that will research, “organisms capable of extracting energy from hydrogen, from reduced earth-abundant metal ions, from robust, inexpensive, readily available organic redo active species, or directly from electric current.

It is theorized that such an approach could be 10 times more efficient than current photosynthetic-biomass approaches to liquid fuel production. Click here to learn more about submiting a proposal.

Some of the biggest news to come out of Copenhagen yesterday was the ruling from the Environmental Protection Agency that greenhouse gas emissions are now considered “an endangerment” to society. This ruling now gives the EPA the authority, under the Clean Air Act, to regulate greenhouse gases. This decision could lead to stricter vehicle, manufacturing and power plant emissions – including ethanol and biodiesel plants.

The timing was no coincidence as President Obama is looking to improve America’s bargaining hand during the two week Climate Change Conference where leaders from nearly 200 countries are attempting to create a global climate policy plan.

On December 7, 2009, the Administrator signed two distinct findings regarding greenhouse gases under section 202(a) of the Clean Air Act:

• Endangerment Finding: The Administrator finds that the current and projected concentrations of the six key well-mixed greenhouse gases–carbon dioxide (CO₂), methane (CH₄), nitrous oxide (N₂O), hydrofluorocarbons (HFCs), perfluorocarbons (PFCs), and sulfur hexafluoride (SF₆)–in the atmosphere threaten the public health and welfare of current and future generations.
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• Cause or Contribute Finding: The Administrator finds that the combined emissions of these well-mixed greenhouse gases from new motor vehicles and new motor vehicle engines contribute to the greenhouse gas pollution which threatens public health and welfare.

In addition to tightening emission standards, there are two other ways that have been discussed at length to regulate CO2 emissions, the gas that is in the most abundance. First is through a carbon tax and second through a cap and trade system.

American Process, a company based in Atlanta, Georgia, has received a portion of the funds that were awarded by the Department of Energy’s (DOE) Biorefinery Assistance Program – $17.9 million to be exact. The funds will be used to develop a plant that will produce ethanol and potassium acetate, a deicer, from wood waste generated by a local hardboard company, Decorative Panels International.

According to an article in the Michigan Messenger, Governor Jennifer Granholm said in a statement, “This grant, in support of one of our Centers of Energy Excellence, will bring 160 jobs to the Alpena area and strengthen Michigan’s efforts to be a leader in the development of the next generation of advanced biofuels.”

Back in June, the state approved the site location as part of a tax-exempt Renewable Energy Renaissance Zone for 15 years beginning next January. In addition to the DOE funds, the project has had other investments including the receipt of $4 million from the Center of Energy Excellence.

Solazyme, Inc., which was just named the ‘Top 50 Hottest Company in Bioenegy‘ by Biofuels Digest, announced that it has received a $21.8 million federal grant to build its first integrated biorefinery in rural Riverside, Pennsylvania. The funding was announced by the U.S. Department of Energy (DOE) and marks the next step in producing algal based fuel. Research conducted by the company has shown that their algal oil will reduce overall greenhouse gas emissions between 85-95 percent.

“We are honored to partner with the Department of Energy and are excited to be creating jobs in California and Pennsylvania. Our technology reduces reliance on foreign oil and enhances national security while providing strong environmental benefits,” said Jonathan Wolfson, chief executive officer of Solazyme.

According to the company, the DOE funds, along with other private investments will be used, “to move toward commercialization faster, creating and preserving jobs in diverse regions across the country and creating jobs in manufacturing, construction and agricultural processing.” Solazyme’s Integrated Biorefinery will be located on the site of Cherokee Pharmaceuticals’ existing commercial biomanufacturing facility in Riverside, Pa.

“Last year’s record high gas prices and their impact on families and businesses proved that we must reduce our dependence on foreign oil in favor of biofuels produced here at home. Solazyme’s innovative project is working towards that goal by demonstrating how we can turn algae into fuel in a cost-effective way and on a commercial scale. These are the types of investments we must make today in order to strengthen our economy, our environment and our national security in the long-run,” said Governor Edward Rendell of Pennsylvania.