Domestic Fuel

Indore Oil Company has joined forces with Protec Fuel in opening their fourteenth E85 fueling location for flex fuel vehicle (FFV) owners in the Atlanta area. The E85 station is located at the Chevron Food Mart in Duluth.

Indore Oil partnered with Protec Fuel to offer E85 through the group’s turnkey E85 infrastructure program. “We at Indore Oil Company are energized on the prospect of working with Protec to bring E85 to this Chevron,” said Mihir Patel, General Manager of Indore Oil Company. “Our relationship with Protec and our customers continue to grow as we bring more alternative fueling options throughout the Atlanta market together.”

“Protec Fuel is pleased to now supply fourteen Indore Oil stations with E85,” noted Protec Fuel’s managing member, Todd Garner. “Mihir and his team are proactive entrepreneurs. We look forward to working with them more in the future in assisting Atlanta drivers in finding convenient locations to fuel their vehicles with E85.”

USDA’s latest World Agricultural Supply and Demand Estimate released this morning shows an increase in corn use for ethanol.

U.S. corn ending stocks are unchanged this month as a projected increase in corn use for ethanol is offset by a reduction in expected feed and residual use. Corn used to produce ethanol is raised 50 million bushels as strong blender incentives and positive ethanol producer margins continue to encourage expansion in ethanol production and use. Rising gasoline prices have pulled ethanol prices higher helping to offset increases in corn feedstock costs for ethanol producers.

European Union members have voted to extend current tariffs on U.S. biodiesel, and that violates the group’s own laws, according to the National Biodiesel Board.

This Reuters article posted on ForexPros.com says EU officials accuse U.S. exporters of smuggling biodiesel through Canada to avoid tariffs imposed since 2009:

“We think this would be a bad decision that runs directly counter to current EU law,” said Manning Feraci, vice president of federal affairs at the U.S. National Biodiesel Board, the country’s leading biodiesel industry group.

EU firms accuse U.S. producers of being involved in a “splash and dash” scheme, whereby they may import cheap biodiesel from countries such as Brazil and add less than 5 percent of U.S. diesel. The producers then qualify for a subsidy from Washington before exporting it to Europe.

The extension would start in May and last until 2014.

In the face of increasing unrest in the Middle East and higher gas prices, the Senate Committee on Energy and Natural Resources met this morning to review Department of Energy (DOE) biofuel programs and biofuel infrastructure issues.

In testimony before the committee, Renewable Fuels Association President and CEO Bob Dinneen stressed the importance of expanding the marketing for ethanol-blended fuels to meet the goals of federal Renewable Fuels Standard (RFS).

“At a minimum, federal policies should maintain and extend existing tax incentives for higher level ethanol blends to allow for continued growth, expand tax incentives for refueling infrastructure, and create new consumer-based tax incentives to encourage the purchase of FFVs,” Dinneen testified.

Read Dinneen’s testimony here.

Bill Brady, CEO of Mascoma Corporation and Chairman of the recently formed Advanced Ethanol Council, also testified before the committee on the need to make significant strides in the commercialization of advanced and cellulosic ethanol.

“The technologies are ready. Putting in place a consistent, long-term federal policy for advanced and cellulosic biofuels including significant focus on higher-blend ethanol infrastructure and FFVs is critical to continued development in the United States and its ability to continue to keep pace with clean energy investments of other countries,” Brady testified, urging Congress to maintain DOE’s authority and funding to provide renewable energy loan guarantees. “To cross the valley and start construction of projects in 2011, this loan guarantee authority represents the best available tool for many projects,” he said.

Read Brady’s opening statement here.

As I reported to you back on March 17th, it looks like a bad batch of petroleum, not the biodiesel, was the real culprit with some recent problems with bioheat (a mix of biodiesel and home heating oil) in the Northeastern United States.

This blog post from Biodiesel Magazine says testing has confirmed the petroleum’s role:

Paul Nazzaro, petroleum liaison to the National Biodiesel Board, shared with Biodiesel Magazine an excerpt from a detailed report prepared by members of the Bioheat Technical Steering Committee as it pertains to the New Hampshire fuel quality concerns expressed by regional fuel dealers. He said a more comprehensive report will be provided to industry leaders within the week.

“At a recent meeting of fuel dealers in New Hampshire, requests for fuel samples and burner nozzles or combustion parts with carbonaceous deposits were made, and several of these were obtained and sent to independent labs for analysis,” the excerpt stated. “The data generated indicate poor quality base heating oil is the likely root cause of the burner issues in New Hampshire, and that the presence of biodiesel as Bioheat was not likely a contributing factor to the problems. Base fuel instability is the likely cause. Fuel sampled from a delivery truck clearly indicates this. Equipment problems are ruled out. Problems occurred with all domestic burners and with all appliance types. Biodiesel is ruled out. There were no indicators of off-spec biodiesel, and problems occurred regardless of fossil-renewable carbon content.”

Nice to see that biodiesel was cleared. Now lets see if the retractions accusing the green fuel of the wrongdoing come as quickly as the charges against it.

A new report from the feds says, due to the recession, overall energy consumption in the U.S. dropped in 2009. However, renewable energy … biodiesel, ethanol, wind, solar and hydro power … use during that same period actually increased.

This report from the U.S. Energy Information Administration shows that overall energy consumption in 2009 dropped by 4.8 percent, the second year in a row that consumption dropped and just the third time since 1949 that energy consumption has declined for two or more consecutive years. But clean energy sources fared much better during that same time:

Consumption of all major fuels declined between 2008 and 2009, except for renewables. Coal dropped the most, falling 12 percent, while petroleum consumption fell nearly 5 percent, and natural gas consumption fell 2 percent. Even nuclear fuel consumption fell by nearly 1 percent…

Hydropower consumption grew 6.3 percent in 2009…

The report goes on to say that wind went from a “relatively minor renewable energy source” to making up nearly 10 percent of total renewable energy consumption. In addition, biodiesel and ethanol got good boosts from various financial incentives and mandates.

Manitoba, Canada is now the proud province of a new wind farm. The 138 megawatt (MW) St. Joseph Wind project has been completed by the Pattern Energy Group LP (Pattern) and should generate enough power to meet the electricity needs of 50,000 homes in the Manitoba area. Pattern and Manitoba Hydro have entered into a 27-year power purchase agreement for the sale of energy produced by the project. To celebrate the accomplishment, the Manitoba Minister of Innovation, Energy and Mines, David Chomiak spoke during an opening ceremony.

“This wind farm is one of the largest in the country and will produce enough energy to power 50,000 homes,” said Minister Chomiak. “It showcases our province’s dedication to creating renewable energy and continuing to build Manitoba Hydro. This project has also provided a solid boost to the local economy creating new opportunities and jobs.”

Over the life of the wind farm, Pattern will pay an estimated $38 million to landholders and an additional $44 million in local municipal taxes with two-thirds of the tax revenue dedicated to education and one-third committed to host communities. This is a significant revenue boast for the area.

Mike Garland, Pattern’s CEO said, “The St. Joseph wind project created 350 jobs during its construction, 75 percent of which came from Manitoba, with another 20 percent from other Canadian provinces, in addition to the permanent crew of 10 workers we hired to operate and maintain the project. The success of this project is due to the support and commitment of all those involved, including the Province of Manitoba, Mortenson Canada, local landowners and the great community of St. Joseph. By working together to harness the steady winds of St. Joseph, we have created jobs, revenue, and a significant source of clean and renewable energy for Manitobans.”

“We commend the excellent and timely work of Mortenson Canada, which completed the construction of this world-class wind project in just under a year – an extraordinary timeline for a project of this size and scope, especially considering the harsh winter conditions,” added Garland.

Manitoba Premier Greg Selinger set the first group of turbines in motion back in January and today’s event marked the milestone of the project becoming fully operational.

Gas prices may be on the rise resulting in a great market for ethanol, but ethanol plant margins are still tight. You can learn hands-on strategies to improve your ethanol plant margins by attending the fifth Process Optimization Seminar in Houston, Texas on April 27-29th. The seminar is sponsored by several leading ethanol industry companies including Phibro Ethanol Performance Group, Fermentis, Novozymes, and Fremont Industries.

Steve Rust, the Marketing Director for Fremont Industries, has been involved in these seminars since their inception four years ago. While Rust explains they have been wildly successful, after receiving feedback from the participants, the team decided to move away from the Midwest and head to Houston where plant managers, general managers and operations managers can get an even more hands on experience. The group will be visiting a refinery as well as visiting SGS labs.

Listen to my interview with Steve Rust here: Steve Rust Discusses Process Optimization

Rust said past seminars have been a series of 100/200 level classes designed for operations managers to understand why they do what they do. Following the seminars, attendees approached the instructors asking for more in-depth sessions. As a result, this seminar will focus less on operations and more on the financial aspects on how to manage plant operations but with a focus on high-level managers. The sessions will focus more on the expertise of the sponsor companies and how they can aid the plant in becoming more profitable.

Fremont Industries has an expertise in water treatment and today has over 40 ethanol plants that they work with. Rust said that where water treatment technologies can really benefit a plant is in keeping costs down because the plant is running at peak efficiency. Rust said there are exchangers and pre-treatment equipment that can help keep a plant’s costs down and these will be discussed during the event.

I asked Rust why this this event is so unique and so important for the industry. “What we really try to do is respect the time away from the plant because we know plants are busy,” said Rust. He said that they moved the event to Houston because they knew that they wanted to give the attendees some extra value and things like the tours coupled with the seminar sessions would give them tools they could take back to the plant, implement immediately, and see their profits increase.

Registration is limited and the early bird registration deadline is April 15th. Visit the Process Optimization Seminar website for more information and for online registration.

POET has announced it is now selling corn oil extracted from its ethanol plants for use by the biodiesel industry to produce biodiesel. Known as Voilà, the company’s patent-pending technology was debuted at its plant located in Hudson, South Dakota. POET plans to add the technology to its other plants over the course of the year. Eventually, POET believes its plant will produce 500 million pounds per year – enough corn oil to produce 60 million gallons of biodiesel per year.

The company says its corn oil is different than other corn-ethanol plants’ corn oil due to the low-energy BPX fermentation process (cold cook) they use. This process eliminates heat from the process and when the corn oil is captured at the back-end of the process, it is a higher quality product with a lower amount of free fatty acids.

“The corn kernel is an amazing thing,” said POET CEO Jeff Broin. “As we continue research into more and more co-products, our ability to displace foreign oil continues to grow. By selling Voilà to biodiesel producers, we’re providing the feedstock for even more renewable fuel production.”

Scott Weishaar, POET Vice President of Commercial Development added, “Not only is it high-quality corn oil, it is a consistent product, which is important to biodiesel producers. Our customers have been very pleased with Voilà.”

In addition to producing biodiesel, corn oil can also be used as a component in feed production. In the future, POET plans on introducing a new branded distillers product that incorporates its corn oil as an ingredient.

The Brazilian Sugarcane Industry Association (UNICA) today announced the appointment of David Thomas as Chief Lobbyist and Leticia Phillips as Representative for North America, both based at UNICA’s Washington, D.C. office. They replace Joel Velasco, who left UNICA in January to become Senior Vice-President for External Relations at California Biotech Company Amyris.

A seasoned strategist with almost two decades of experience in the Washington public policy arena, Thomas is a former Deputy Director of Legislative Affairs for Vice-President Al Gore and Director of Congressional Relations at the U.S. Federal Trade Commission (FTC). More recently, he served as Chief of Staff for U.S. Congresswoman Zoe Lofgren. As a Senior Strategist with Washington lobbying firm Mehlman, Vogel, Castanetti, Thomas was directly involved with UNICA’s 2010 campaign against U.S. tariffs on imported ethanol.

In her continuing role overseeing Institutional and Government Affairs for North America since 2008, Phillips will now lead UNICA’s efforts as its Representative for North America on a variety of fronts in which UNICA is currently engaged.

Carolina Lessa will remain in her role as coordinator of communications and media relations efforts in North America.

Source: UNICA news release

Protec Fuel along with AJ Energy announces the opening of a new E85 site at a BP station in the Buckhead area of Atlanta, Georgia to provide the choice for flexible fuel vehicle (FFV) owners in the area.

AJ Energy partnered with Protec Fuel to offer E85 and used Protec’s turnkey E85 infrastructure program. “As a company, we are very excited to be able to be part of the energy revolution,” noted owner of the BP facility, Ayad Jaber. “Alternative fuels such as E85 are safer for the environment, more cost efficient for the consumer, and an all-around better energy source than traditional fuels.”

“Protec Fuel is excited to work with Ayad and his team to make E85 available to more Atlanta flexible fuel vehicle (FFV) drivers. We would like to inform all FFV owners of the benefits of E85 versus regular unleaded gasoline and of the cost benefit to using this product,” said Protec Fuel’s Managing Partner, Todd Garner.

“It has been a pleasure working with Protec and we appreciate the strides they have made to help bring cleaner, safer, and more cost efficient energy sources to the Atlanta market place and we hope our great customers will embrace a more environmentally friendly fuel,” added Jaber.

What grade did you give U.S. Secretary of Agriculture Tom Vilsack for his mid-term? I think the results of our last ZimmPoll show how difficult it is to please everyone. We asked the question, “What mid-term grade would you give Ag Sec. Vilsack?” The votes for an A and an F were the highest and equal. 24% give him an A while 24% give him and F. Those grades are followed by 20% giving him a B, 19% a D and 13% a C. If you feel strongly about a certain grade feel free to leave a comment about why. We love getting your opinions and comments lets you freely express them!

So, let’s look at our newest ZimmPoll question, “How should farmers respond to critical documentaries such as Food Inc.?” The results of this question will be published at the start of the 2011 Agri-Marketing Conference next week and I think the results will be of real interest to agrimarketers attending. If you have a different idea than one of the choices we’ve presented then please feel free to comment. Thanks your your participation.

And if you have any questions you want to suggest for future ZimmPolls please let us know.

ZimmPoll is sponsored by Rhea+Kaiser, a full-service advertising/public relations agency.

A planned $165 million biodiesel and soybean-processing facility in Indiana got a boost when a local commission approved the company building a storage facility so its air quality permit will stay current.

This article from the Fort Wayne News-Sentinel says Ultra Soy of America got approval to put up a 21,450-square-foot steel storage building at its site near South Milford:

Gary Pipenger, founder of Ultra Soy of America, said the company needs to start building at 7500 County Road 700 South near South Milford before April 15 or its air quality permit will expire.

The plant was expected to produce 60 million gallons of biodiesel fuel a year, eventually doubling production to 120 million gallons annually, making it one of the largest facilities in America.

Company officials say they were on track in 2009 to get all the funding done but were sidetracked when the economy went south.

R3 Fusion, Inc. has announced the availability of its commercial system for recovering ethanol from waste scrubber water. The technology is coined the SPaCeRTM. The system is designed to process 50 gallons per minute of scrubber waste generated from a 50 million gallon per year (MMGY) ethanol plant and the first modular system will be fully operational this month.

Dr. Roshan Jachuck, the inventor of the SPaCeRTM technology and CTO of R3 Fusion said, “We estimate that over $400 million of ethanol can be recovered each year from the waste water in U.S. ethanol facilities alone. The unique engineering and process technology incorporated in our systems provides, to our knowledge, the most economical, energy efficient means available to capture that critical element of our national energy equation.”

The SPaCeRTM technology was developed to address the increasing worries about the supply of fresh water. According to R3 Fusion, less than 1 percent of the planet’s water is fresh water and available for human use. Therefore, the company believes the need to reuse, recycle and remediate contaminated and waste water steams is essential, and they along with other companies worldwide are developing technologies to extend the water supply.

“We are very excited about the launch of our SPaCeRTM technology and the enormous implications we believe it will have on global water supplies,” concluded Keith Blakely, CEO of R3 Fusion. “The interconnectedness of our water, energy, and environmental challenges is well-established and a system like ours that addresses all three simultaneously is, we believe, of great importance to the future of our planet.”

American Ethanol is heading to Texas this weekend for the NASCAR Nationwide Series race, the O’Reilly Auto Parts 300 at the Texas Motor Speedway on April 8th beginning at 8:30 pm EST on ESPN2. While the ethanol logo is on all the race cars, eyes will be on the No. 9 Toyota Camry driven by Kenny Wallace, who is sponsored for the season by the ethanol industry in partnership with the National Corn Growers Association (NCGA).

“It is an honor to be chosen as an American Ethanol spokesperson,” said Wallace who drives for RAB Racing. “I am very passionate about this subject and excited to spread true knowledge about American Ethanol throughout the United States. I’m proud and excited to go to Texas with new sponsor American Ethanol, and most of all I’m looking forward to getting my 10th NASCAR Nationwide Series win.”

During the entire 2011 season, all three of NASCAR’s national touring series will be racing on Sunoco Green E15, a blend of 15 percent corn-based ethanol and 85 percent racing fuel.

NCGA President Bart Schott noted, “Having Wallace as the driver is a great benefit. The RAB Racing team is racing very competitively this season and they are proving to be great proponents for Sunoco Green E15. Kenny understands the important economic and environmental contributions of the nation’s ethanol producers and family corn farmers. As a passionate and media-savvy spokesman, he is helping us reach millions of driving consumers with a positive message about domestic ethanol.”

As gas prices continue to rise across the nation, the ethanol industry stresses that ethanol is a commercially-viable alternative that America currently has to strengthen the nation’s energy independence. Studies have shown that for every $1 sent overseas for oil, $1.55 leaves the U.S. economy. The industry is using NASCAR as a platform to expose 80 million people to the benefits of ethanol while linking millions of American farmers with the sport of NASCAR.

“We’re proud that American Ethanol’s partnership with the RAB Racing team will help educate NASCAR fans about ethanol’s benefits for our nation’s environment, economy, and energy security,” concluded Tom Buis, CEO of Growth Energy. “There’s no sport more American than NASCAR and there’s no fuel more American than ethanol.”