Domestic Fuel

The head of the Advanced Biofuels Association (ABFA) told a House subcommittee this week that America’s domestic advanced biofuels industry has “moved from the beaker to the barrel, all in record time.”

AFBA president Michael McAdams testified before the U.S. House Small Business Committee’s Subcommittee on Agriculture, Energy and Trade on Thursday, sharing some of the advance biofuels success stories which have occurred over the last year.

“The Air Force has flown the F-16/Thunderbirds on a mixture of advanced biofuels, the navy has tested advanced biofuels in ships and vehicles, and the commercial sector has flown the first cross country flight on a blend of renewable jet fuel,” McAdams said. “We have one member, Dynamic Fuels, producing a million gallons of renewable jet and renewable diesel a week, and have five members who have gone public. In addition, two Colorado member companies are preparing to deploy their innovative technologies in the near term.”

“Gevo, which will produce an isobutanol, a drop in, fungible fuel, will commission its 18 million gallon plant in June of this year in Luverne, Minnesota. While Sundrop Fuels is on target to break ground to build a 50 million gallon cellulosic gasoline plant in Louisiana this year,” he added.

McAdams says the single most important policy issue for advanced biofuels is the Renewable Fuels Standard, so it is “fundamentally important that the Congress continue to send a strong bipartisan signal of support for this policy if we wish to continue the remarkable progress and grow an advanced biofuels industry.”

Novozymes has announced a partnership with Shengquan Group, a Shandong-based company specializing in furan resin and polymers, to start commercial-scale production of cellulosic ethanol for solvents in June 2012 using Novozymes’ technology.

“Shengquan is a global first mover in this industry, which is on the verge of materializing right now,” says Poul Ruben Andersen, Vice President for Bioenergy at Novozymes. “Shengquan has profound experience in chemical production and is a leading company in commercializing cellulosic ethanol. Novozymes is proud to join Shengquan in nurturing a green and circular bioeconomy which lessens the dependence on fossil fuel resources.”

Novozymes is a leading enzymatic solution provider in bioenergy. It partners with leading producers of cellulosic ethanol all over the world to commercialize this new technology.

In the Senate Agriculture Committee markup of the 2012 Farm Bill on Thursday, an amendment was added to reauthorize mandatory funding for several national renewable energy programs.

Renewable fuel organizations praised the action. “There is no more urgent need in this country today than creating new jobs and reducing our dependence on foreign oil. The programs reauthorized and streamlined today are doing just that, and will continue to help the United States create jobs and replace foreign oil with homegrown, renewable energy production when signed into law,” said a statement from the Advanced Ethanol Council, which represents a number of companies working to commercialize advanced biofuels.

The Agriculture Energy Coalition noted that passage in the Senate committee was an important hurdle, but energy funding still has a long road ahead. “The Coalition will continue its work throughout the process to ensure the bill and energy title move forward and that energy programs continue to receive appropriate mandatory funding.”

“We commend the great work of the Committee to spur additional energy production in rural America,” said Tom Buis, CEO of Growth Energy. “I specifically want to thank Senators Conrad and Lugar for offering a solid, bipartisan amendment that will provide key resources to rural energy programs such as loan guarantees for on-farm renewable energy, energy-efficiency projects, and research and development for advanced biofuels.”

The committee restored some $800 million for programs such as REAP, BCAP, and Biorefinery Assistance, which were created by the 2008 farm bill.

The Brazilian Sugarcane Industry Association (UNICA) today announced the appointment of an interim CEO to replace Marcos Jank, who announced his resignation on March 27th.

UNICA's Board of Directors has named the organization's Technical Director, Antonio de Padua Rodrigues, to serve as interim CEO during the selection process, now underway, for a new chief executive.

A member of the executive team at UNICA since 1990, Rodrigues has been in the sugar-energy industry for more than 30 years and is the organization's Technical Director since 2003. He is a former Administrative and Financial Coordinator of the Brazilian government's National Program for the Improvement of Sugarcane, known as Planalsucar, and was also Administrative and Financial Supervisor for projects backed by Industry and Technology Secretariat at the Federal Industry, Trade and Technology Ministry. In 1983, he played a leading role in the introduction of SPCTS, the Sugarcane Payment System by Saccarosis Content, where he remained as a Consultant until 1990.

Marcos Jank became Board Chairman and CEO at UNICA in July of 2007 and has since spearheaded a period of significant achievements for the sugar-energy industry.

"It has been a great honor to serve an industry that is so important to national life and is increasingly vital for the planet, given the growing range of low carbon solutions that sugarcane offers; the sector has a very promising future and I'm sure that the work done so far will provide a solid base for the progress that we will witness in the future," said Jank, who brought forward his departure from UNICA because of national and international commitments linked to future activities in his professional life.

Florida Agriculture Commissioner Adam Putnam is pleased with the new energy bill for the state that was allowed to become law last week when Governor Rick Scott declined to either sign or veto it.

“Rooted in common sense, this bill was developed to expand energy production in Florida and create much-needed jobs for Floridians. It garnered bipartisan support from an overwhelming 156 members of the Florida Legislature," Putnam said in a statement. “The bill offers technology-agnostic tax credits to businesses that demonstrate investment in energy production and create jobs in Florida. Any form of renewable energy is eligible; the market will determine how investments are made."

Governor Scott was pressured by conservative interests to veto the bill because of tax breaks included for renewable energy production, but allowed the bill to become law without his signature in “deference” to Putnam’s support for the credits, at the same time warning that he would analyze the results of the tax incentives and could push for a future repeal.

Putnam's office issued an independent economic analysis of the Energy Bill that found the law would "generate $143.5 million in new tax revenue and create more than 3,000 jobs for Floridians."

“The combination of these incentives are projected to generate an annual average of $28.7 million in new tax revenue over the fiscal year 2012-2016 and support as many as 3,350 new jobs in all sectors of the Florida economy by 2017,” said study author John Urbanchuk, Technical Director – Environmental Economics of Cardno ENTRIX.

The bill, which will take effect July 1, includes a sales tax exemption for biofuels distribution equipment, including ethanol, biodiesel and other renewable fuels with $1 million per fiscal tax year cap; an investment tax credit against the corporate income tax for renewable energy technologies; and a provision to permit algae as a feedstock for renewable fuels.

The ethanol industry has been handed a setback in its case against the California Air Resources Board Low Carbon Fuel Standard (LCFS) that was ruled unconstitutional by a judge in December.

From a Growth Energy statement: Yesterday, the U.S. Court of Appeals for the 9th Circuit issued an order expediting briefing in the California Air Resources Board’s appeal of a Federal District Court decision invalidating the state’s Low Carbon Fuel Standard (LCFS). On December 29, 2011, the District Court issued an injunction to prevent CARB’s enforcement of the LCFS, having found the LCFS unconstitutional in its regulation of commerce outside the state and discrimination against fuel produced outside California.

The Court of Appeals also stayed the District Court’s decision and the injunction until the Court of Appeals can fully review the District Court’s December 2011 decision. Briefing will be completed by early summer. The ethanol industry plaintiffs look forward to fully briefing the issues before the Court of Appeals on the expedited schedule that the Court has issued.

While environmental interests, like the Natural Resources Defense Council, are happy about the decision, the ethanol industry is confident the original court ruling will ultimately be upheld.

“The ruling made by Federal District Court Judge Lawrence O’Neill finding the LCFS unconstitutional was based on sound legal precedent and should stand,” said Renewable Fuels Association President and CEO Bob Dinneen. “At its core, we believe the LCFS to be unlawfully written and decidedly punitive against ethanol produced in United States but outside the borders of the state of California. We will vigorously defend our position and support the ruling of Judge O’Neill.”

The oil industry is united with corn-ethanol producers on this issue because they believe the mandate is unfairly punitive to out-of-state fuel suppliers.

The Governors’ Biofuels Coalition is urging the Senate Finance and House Ways and Means Committees to include E85 in the definition of the Alternative Fuel Tax Credit and recommending that the provision be extended as part of the pending “Extenders Bill.”

In a letter sent to the leadership of both committees last week, the governors noted that E85 was considered an alternative fuel for federal energy policy purposes under the Energy Policy Act of 1992, but Congress wrote E85 out of the alternative fuels credit in order to avoid a double tax benefit with both the ethanol tax credit and the alternative fuels tax credit in effect. “Now that Congress has ended the ethanol credit, E85 could continue to benefit from the alternative fuels incentive,” they said.

The coalition, which is made up of the governors of 33 states, say that if E85 is not included in the alternative fuel tax credit, flex fuel vehicle drivers will pay as much as 38 cents more per gallon, significantly reducing the demand for the fuel. “On the other hand, extending the credit with E85 would only cost the Treasury approximately 0.8% of the full, expired ethanol subsidy. We believe this small, short-­‐term investment will make a significant difference in the success of petroleum fuel alternatives,” they added.

Defining E85 as an alternative fuel in the tax code is one of the main goals of the Coalition for E85, a group of retailers, producers, equipment manufacturers, automobile manufacturers and other supporters of E85 fuel.

The final federal hurdle to getting 15% ethanol at the pump has officially been satisfied with the funding of a nationwide fuel survey required by the Environmental Protection Agency (EPA).

The ethanol industry reports that a total of 99 ethanol producers are funding the survey to meet the requirement under the partial waiver approved by EPA.

“Despite owning just a handful of the nation’s 160,000 gas stations that will be the actual participants in the survey, ethanol producers are providing the lion’s share of funding for this survey in order to bring a higher performing, lower cost fuel to the market in E15,” said the Renewable Fuels Association (RFA), Growth Energy, and the American Coalition for Ethanol (ACE) in joint announcement praising the industry for stepping up to the plate to help bring E15 to the market.

Efforts to bring E15 to pumps across the nation will now focus on states where regulatory issues must be addressed. Some states, like Iowa, Illinois, and Kansas are prepared for E15 and sales of E15 could commence as soon as all parties are registered with EPA and are implementing the Misfueling Mitigation Plan approved by EPA. However, challenges such as pending litigation and anti-ethanol posturing by some in Congress, make it difficult to predict an exact time frame for the growth of E15 sales volumes nationwide.

The fuel survey is required annually and will be conducted by RFGSA. The survey will be collecting more than 7500 samples each year of all gasolines available nationwide and will begin on May 1, 2012.

A coalition of trade groups and organizations representing renewable energy, energy efficiency, farm and environmental interests is disappointed in a 2012 Farm Bill draft out of the Senate Agriculture Committee that they say provides “no real funding for energy programs.”

“The Committee draft bill moves the process forward, thankfully, and we support getting a bill done this year,” said Ag Energy Coalition Co-director Lloyd Ritter in a statement. “However, the core energy title programs that are necessary to move the country toward greater energy security, increase jobs, revitalize manufacturing, and improve environmental quality require mandatory funding. REAP, BCAP, Biorefinery Assistance and BioPreferred, among others, have produced results across the country, especially in rural America where jobs are dwindling.”

Coalition member Brent Erickson of the Biotechnology Industry Organization (BIO) noted that the Farm Bill’s energy programs have helped revitalize rural America, allow new agricultural markets emerge, and reduce the need for direct payments to farmers. “These programs have unlocked private capital for construction of biorefineries, put more than 150,000 acres of underutilized farmland into production of next-generation energy crops, and ignited an explosion of biomanufacturing innovation, demonstration and early commercialization,” said Erickson. “In the short time that these programs have operated, they’ve achieved a high rate of return in supporting the start up of renewable chemical, advanced biofuel and biomanufacturing companies, as a timeline of the programs demonstrates.”

The Senate Agriculture Committee is scheduled to begin markup on the Farm Bill this week and the House Ag Committee will also be working on the legislation.

A new poll showing strong support for renewable fuels validates some of the most important ethanol industry legislative priorities – including maintaining the Renewable Fuel Standard (RFS), commercializing E15, providing incentives for the development of cellulosic ethanol, limiting tax incentives for the oil industry, and requiring automobile manufacturers to build cars that will run on fuel sources other than oil.

Renewable Fuels Association (RFA) President and CEO Bob Dinneen talks about the poll results and what they mean in this edition of “The Ethanol Report.”

Listen to or download the Ethanol Report here: Ethanol Report on Poll Results

Subscribe to the Ethanol Report here.

A new poll from the Renewable Fuels Association (RFA) indicates overwhelming support by Americans for renewable fuels.

The poll, conducted by American Viewpoint, shows American voters are supportive of the key federal policy driving renewable fuel innovation in America today – the Renewable Fuel Standard (RFS), with a full 61% percent of adults polled saying they supported it.

“Poll after poll consistently demonstrates that Americans of all stripes believe we must be pursuing the production and use of renewable fuels to reduce our dependence on imported oil,” said RFA President and CEO Bob Dinneen. “The RFS is a critical component to the continued growth and innovation of this industry. The RFS ensures that ample supplies of renewable fuels like ethanol are available today and that new and promising renewable fuel technologies will have a market in the future. The RFS has proven effective in addressing America’s goals by helping reduce volumes of imported oil, create jobs, and lower greenhouse gas emissions from transportation fuel.”

Participants in the poll responded very favorably to the continued efforts to bring cellulosic ethanol production to commercial scale through the use of targeted tax policies. Sixty-five percent said they supported such incentives to help expand cellulosic ethanol production. By comparison, 69% said they opposed tax subsidies and other incentives for petroleum companies. Finally, respondents expressed strong support for greater choice when pulling up to the pump. Seventy-five percent of those polled said they would support requiring automakers to build cars to run on fuel sources other than oil. The RFA has been a strong and early champion of the Open Fuel Standard (OFS) that would accomplish this exact goal.

The poll results come on the eve of the RFA’s inaugural Washington Legislative Forum being held tomorrow, April 18th, at the Newseum in Washington , DC where Attendees will hear from congressional and administration officials about legislative priorities outlined in the poll and the chances for any legislative action regarding these priorities in 2012. Following the meeting, RFA members will take to Capitol Hill to meet with dozens of lawmakers on issues important to America’s renewable fuel industry.

With the 2012 crop year now underway, we’re introducing the BASF Production Poll. This new poll will be conducted twice each month during the season with timely questions that we think both farmers and non-farmers alike will find interesting. We’d love to hear from you. So let’s get started with our first one.

Please let us know if you have any questions about the poll.

Brazil is expecting more sugarcane and more ethanol production in 2012.

According to the Brazilian Sugarcane Industry Association (UNICA), the forecast for the 2012/2013 sugarcane harvest calls for 509 million tons, up 3.19% compared to the total amount of sugarcane processed in the previous harvest, which totalled 493.26 million tons.

Data collected by UNICA, together with satellite image mapping of the South-Central region obtained from the National Institute for Space Research (CANASAT-INPE), indicates an expansion of 3% in the total area planted with sugarcane and available for the 2012/2013 harvest while no significant gains in agricultural productivity are anticipated.

Of the total projected sugarcane crush for the 2012/2013 harvest, UNICA estimates over half of the sugarcane in the 2012/2013 season (51.25%) will be used for ethanol production, which is expected to reach 21.49 billion liters, up 4.58% from last year’s 20.55 billion liters. That total includes 14.54 billion liters of hydrous ethanol, up 11% from last year, and the rest anhydrous, a drop of almost 7%.

UNICA is projecting a drop in anhydrous ethanol production because during six months of the 2011/2012 harvest, Brazil’s mandatory ethanol blend with gasoline remained at the 25% level, 5% above the 20% blend currently in place. The organization notes that the projected production for each type of ethanol in the new harvest was calculated considering the current blend rate. “Should the percentage required by the government change during the harvest, hydrous and anhydrous ethanol volumes will also be revised by UNICA.” UNICA is also projected a drop of more than 8% in ethanol exports, which would bring the exported total down to 1.70 billion liters, compared to 1.85 billion liters in the 2011/2012 harvest.

According to UNICA Technical Director Antonio de Padua Rodrigues, current estimates indicate that the Brazilian fleet of flex-fuel automobiles and motorcycles will increase by 7% during the 2012/2013 harvest, an expansion rate that’s slightly below the projected increase in production o hydrous ethanol. “This means we are likely to observe a slight increase in the consumption of hydrous ethanol by flex-fuel vehicles during the next harvest,” he said.

From premium diesel, gasoline and lubricants to propane, biodiesel and ethanol, the GROWMARK Energy Division continues to grow and offer high quality products to member cooperatives and the general public.

The annual volume for the cooperative system’s energy division exceeds 1.6 billion gallons of gasoline, distillates and propane, and about 80 percent of the gasoline marketed by GROWMARK and FS member companies contains 10 percent ethanol. According to GROWMARK Energy Marketing and Communications Manager Ron Durdle, they own two refined terminals in Menard, Illinois and Ft. Dodge, Iowa. “The Menard terminal continues to be a good asset for us,” Durdle said during a recent GROWMARK media tour. “Recently added biodiesel blending there and the load-out equipment is state of the art.” Menard has storage for 80,000 gallons of ethanol and 30,000 gallons of biodiesel.

The terminal just east of Ft. Dodge was purchased by GROWMARK in the fall of 2010. “We’re upgrading that, adding biofuels to it and upgrading the facility in general,” Durdle said. GROWMARK’s interest in biofuels extends to part ownership of Mid America Biofuels, a 30 million gallon biodiesel plant in Mexico, Missouri. “It is definitely a mainstream part of our business,” he added.

Propane is a rapidly growing segment of the GROWMARK energy business with the cooperative system now ranked as the sixth largest propane marketer in the country. “GROWMARK FS is in the propane business out of New York state,” Durdle said. “In the bulk of our trade territory, in the Midwest, propane is used for grain drying. But a more regular business is home heat so we’re kind of working our way east there.”

The GROWMARK Energy Division brands range from Dieselex Gold and Comfort Pro propane to United and Archer lubricants and Fast Stop stores. “That’s our retail brand,” Durdle said of Fast Stop. “Very nice opportunity for us to serve other markets than agriculture with our retail sites.”

Overall, Durdle says reaching out to additional geographies and markets adds volume to the overall system and provides a better return for FS cooperative members.

Listen to an interview with Ron Durdle here: Ron Durdle Interview

The American Coalition for Ethanol (ACE) has released an ‘infographic’ entitled “It’s Working” which provides a vivid depiction of how the Renewable Fuels Standard (RFS2) and ethanol are reducing oil imports and saving Americans money at the pump.

ACE Executive Vice President Brian Jennings says the infographic’s attention-grabbing charts and statistics were an important part of the group’s recent DC fly-in and can be used to educate the media and general public about the benefits of ethanol. “We felt the need to create a unique and informative tool about what the RFS and ethanol are accomplishing during our fly-in. Sixty ACE members hand-delivered it to nearly 200 congressional offices and, based upon their feedback, the infographic enabled them to make a persuasive case about the need to keep the RFS intact,” said Jennings. “We encourage all grassroots ethanol supporters to make good use of this valuable resource by sharing it with their policymakers and local media.”

The infographic cites data from the U.S. Energy Information Administration and other reliable third-parties and depicts noteworthy ethanol accomplishments since enactment of the RFS, including helping reduce oil imports and replace the need for 485 million barrels of imported oil, how U.S. ethanol production is greater than the gasoline which could be produced from the Arctic National Wildlife Refuge, Bakken Shale Oil Formation, and proposed Keystone XL pipeline combined, and how ethanol helps save consumers money.

The image here is just part of the total infographic, which can be viewed in its entirety on the ACE website.