Pacific Ag Bales Bundles of Energy

Bill Levy Pacific AgLast week Abengoa’s cellulosic ethanol biorefinery went online and is expected to produce 25 million gallons of advanced ethanol per year as well as 21 MW of bioenergy. But how exactly does the corn and wheat residue get from the fields to the biorefinery in a economical and efficient way? Enter Pacific Ag.

The company was founded by Bill Levy in 1998 and began by baling residue for growers and using the biomass for animal feed both in the U.S. and internationally. It was a natural progression for Pacific Ag to get involved in cellulosic production in the U.S. and to become a major supplier to the industry.

I asked Levy to talk about their residue removal model. He noted that since their inception, they have always focused on having a balanced residue program for growers and they are finding value for those products for them. So taking their successful model from the Northwest and applying it to the Midwest was a good fit. “The fundamentals of having residue removed on a timely basis and in a sustainable way is really the same,” explained Levy. Today they are in California, North Carolina, Iowa, Kansas and he says they have innovated to become “energy balers” because of the new bioenergy market for residue.

There has been talk about the best biomass model for the biofuels industry. I posed this question to Levy and he explained how they have refined their model to be financial feasible. “We have tried to make it easy for growers to be part of the program by taking care of the harvest, we own the machinery, we schedule the harvest or the removal of the residue, or energy crop with the grower and then we provide them with an income stream for that product,” Levy answerPacific Ag Hugoton Kansas teamed. “It’s very important that we have the size that allows us to invest in that equipment and a lot of times it doesn’t make sense financially for a grower to to invest in that harvest equipment just to harvest the residue.” Pacific Ag is the largest purchaser and owner of baling equipment in the world.

“So what growers enjoy is being able to sit back and enjoy a residue removal program and the income from that but not have to put a lot of effort into it,” added Levy.

Pacific Ag is looking for growers of rice, wheat, corn and other biomass crops who are interested in working with them. As cellulosic ethanol plants including Abengoa continue to ramp up to nameplate capacity, more biomass will be needed and Pacific Ag is ready to be the advanced biofuels partner to help make the cellulosic industry and the growers who plant the bioenergy crops, successful.

Learn more about Pacific Ag and how to become involved in the biomass energy revolution by listening to my interview with Bill Levy: Interview with Bill Levy, Pacific Ag

Abengoa Cellulosic Ethanol Plant Grand Opening photo album.

Allison Details Abengoa’s Cellulosic Plant

Danny Allison Abengoa Plant ManagerWho better to learn about how Abengoa’s cellulosic ethanol plant works then from Plant Manager Danny Allison. He explained to the standing room only crowd during Abengoa’s grand opening celebration, how the state-of-the-art biorefinery will produce cellulosic ethanol, bioenergy and other byproducts including ash that farmers can use as organic fertilizer on their fields.

Here is how the plant works:

Biomass: biomass harvested from local growers corn and wheat fields by Pacific Ag is delivered to the Abengoa plant to begin the ethanol production process. Each bale is quality tested for moisture, dust and other contaminants that could hinder the conversion process.

Biomass In-take Lines: six-packs of residue travel down conveyor belts to be separated into single bales by a singulator. Each bale goes through a chopper, cutting the biomass Biomass in-take lines at Hugoton Kansas Abengoa biorefineryinto easy-to-handle materials and then fed into a grinder.

Pre-Treatment: The pre-treatment process is where the starch is converted to sugars using Abengoa’s proprietary enzymes. From there fermentation occurs suing industrial yeast to convert the sugar to alcohol. At the end of fermentation, the liquid, now 5 percent alcohol, goes into a 1.3 million gallon tank, or beer well.

Distillation System and Ethanol Holding Tanks: All solids, water vapor and alcohol are removed. The now 95 percent pure ethanol moves to a column while the remaining 5 percent goes to the bottom for reprocessing and reclamation. After all impurities and water are removed, the finished ethanol is pumped to half-million storage tanks and ready for shipment by rail or truck.

Electrical Power Station: The Abengoa bioenergy plant will also produce up to 21MW of renewable electricity used to power the plant. Excess electricity will be fed to the grid for city use.

Learn more about the process by listening to Danny Allison’s remarks: Danny Allison Remarks

Abengoa Cellulosic Ethanol Plant Grand Opening photo album.

RFA Promoting Distillers Feed at Export Exchange

rfa-exex-2014The 2014 Export Exchange is continuing today in Seattle, Washington with representatives from more than 50 different countries in attendance to learn more about DDGS, the distillers feed product produced by U.S. ethanol plants.

The Renewable Fuels Association (RFA) is co-sponsor of the event with the U.S. Grains Council and RFA president and CEO Bob Dinneen says it’s because we produce a lot of distillers feed. “Our plants, if they were a single country, would be the fourth largest producer of corn equivalent feed, behind only the U.S., China and Brazil,” said Dinneen, who spoke at the event yesterday on agricultural policies and politics. Interview with RFA CEO Bob Dinneen at 2014 Export Exchange

rfa-cooper-exexRFA Senior Vice President Geoff Cooper spoke at the event on the supply and demand outlook for DDGS.

“We have ample supplies of distillers grains coming from the U.S. ethanol industry but the demand picture is somewhat murky,” said Cooper. “That murkiness has to do with trade barriers and interruptions in the global trade of distillers grains that we’re seeing.”

Cooper says the U.S. is expected to produce 36-37 million metric tons of DDGS in the current marketing year, but one of the biggest trade disruptions in the market is being created by China’s demand that shipments of distillers grains must be certified to be free of the MIR162 biotech corn trait. “That kind of certification is not possible,” said Cooper. “So, we expect exports to China to be significantly curtailed or even halted until this situation is resolved.”

Last year, half of the U.S. distillers grains exports went to China, but Cooper says there are other countries increasing imports. “We are seeing continued growth of distillers grains exports to other parts of Asia outside of China,” he said, adding that Mexico is increasing imports and countries such as Egypt and Turkey are also growing markets. Interview with RFA Senior VP Geoff Cooper at 2014 Export Exchange

Ethanol Report on E85 Study and Contest

ethanol-report-adThe Renewable Fuels Association (RFA) is looking for visual evidence of prices for 85% ethanol (E85) around the country.

“We’re doing an E85 “Post your Price” contest,” says RFA Vice President, Industry Relations, Robert White. “That came about from a study we just concluded in St. Louis this summer.”

That study showed evidence of price gouging for E85, with retail prices were around $1 per gallon higher than was justified by wholesale prices for the locally available ethanol blendstock.

In this edition of the Ethanol Report, White talks about the study and the new contest.

Ethanol Report on E85 study and contest

Ethanol Industry Applauds Abengoa

abengoaMembers of the ethanol industry joined with government leaders in applauding Abengoa at the opening of its $500 million cellulosic ethanol plant in Hugoton, Kansas last week.

Among those on hand for the celebration was Renewable Fuels Association (RFA) Vice President of Industry Relations Robert White who says Americans should be proud of the new plant “because this phantom fuel, as the naysayers like to call it, is here and it’s here to stay.”

However, White says they are concerned that this third cellulosic plant opening this year could be the last if EPA fails to continue implementing the Renewable Fuel Standard (RFS) as Congress intended. “There may never be another celebration like this and it’s sad but true,” he said. “This promise was made years ago and (the administration) needs to stick to it.”

Interview with RFA's Robert White at Abengoa Opening

Abengoa Cellulosic Ethanol Plant Grand Opening photo album.

DOE’s Moniz Congrats Abengoa on Cellulosic Plant

US Energy Secretary Ernst MonizDepartment of Energy Secretary Ernst Moniz was on hand to help Abengoa Bioenergy celebrate the grand opening of its cellulosic ethanol plant in Hugoton, Kansas. With a beautiful day and a full house, excitement was high as Moniz took the stage to congratulate Abengoa’s achievement.

The $500 million biorefinery was supported, in part, by a DOE loan guarantee. Moniz began his remarks by putting the bioenergy plant in perspective of the larger picture and that is as part of President Obama’s “all of the above” energy strategy.

Moniz said the cellulosic ethanol plant serves three major objectives:

  1. Growing the economy – creating jobs.
  2. Advancing our energy security interests. No only for the United States alone, but also for our allies and friends.
  3. Moving towards the low carbon economy- addressing climate change.

Moniz also noted the importance of the innovation chain, “…and what we’re seeing to today is part of that…But if we’re going to kick start this, we have to work with the private sector with state and local governments with our research institutions and laboratories to get these technologies deployed and drive those costs down to be competitive continued Moniz. So this plant shows all of these features.”

He said that while there will be a few rough spots along the road, what the country is seeing today is the beginning of a new industry.

Listen to Energy Secretary Moniz’s complete comments here:

Listen to Energy Secretary Moniz’s remarks: Energy Secretary Moniz Remarks

Check out the Abengoa Cellulosic Ethanol Plant Grand Opening photo album.

Abengoa Celebrates Cellulosic Ethanol Achievement

Abengoa Cellulosic Ethanol Goes Into ProductionSpanish-based Abengoa celebrated its cellulosic ethanol achievement today with a celebration of the plant’s grand opening. Thousands of people attended the event with dozens of high profile guests on hand ranging from former and current Senators to governors to the town mayor, to Interior Secretary and Energy Secretary Ernst Moniz who gave the keynote speech.

The bioenergy plant is based in Hugoton, Kansas and when at full scale will produce 25 million gallons of cellulosic ethanol from biomass per year as well as 21 MW of electricity. The plant will use no power from the grid, in fact, it will sell its excess power – a model common in Europe and Brazil.

Javier Garoz Neira Abengoa BioenergyAbengoa announced the plant would be located in Hugoton in 2007 and a lot of has happened since then as Javier Garoz Neira, CEO of Abengoa Bioenergy, said in his remarks. That same year they produced cellulosic ethanol from wheat straw in their pilot facility located in York, Nebraska. In 2009 they built a larger cellulosic demonstration plant in central Spain. In 2011, working with the Department of Energy (DOE) Abengoa was able to secure a loan guarantee to build the plant in Hugoton, Kansas and today the plant is gearing up to produce cellulosic ethanol from corn and what residues at commercial scale.

“It is without a question a major achievement. And we believe it will revolutionize the biofuels industry and our future,” said Neira.

Listen to Javier Garoz Neira’s remarks: Javier Garoz Neira Remarks

Manuel Sanchez Ortega AgengoaManuel Sanchez Ortega began his remarks by noting how important today is for everyone in the room. He also addressed the role of the Renewable Fuel Standard (RFS) in providing a platform for the development of second generation biofuels. “Without the RFS, there was no way we would have decided to invest more than $500 million dollars in a project full of risks from both technology and financial without the existence of a solid framework of the RFS.”

Ortega stressed that the role that advanced biofuels will play around the world is not illusive. “The promise of a sustainable and domestic energy is not illusive or imaginary, not anymore. It is right here in front of us. Progress has always come from innovation. And we at Abengoa believe that only through innovation we make make Earth a better place to live.”

Listen to Manuel Sanchez Ortega’s remarks: Manuel Sanchez Ortega Remarks

Check out the Abengoa Cellulosic Ethanol Plant Grand Opening photo album.

Ethanol Advocacy App

ethanol-report-adIf you’re an ethanol advocate, there’s an app for that from the Renewable Fuels Association (RFA).

In this edition of the Ethanol Report, RFA president and CEO Bob Dinneen talks about the new app, what it does, who should use it, and why they developed it. He also comments on when we might yet see a final rule on the 2014 volume requirements under the Renewable Fuel Standard and how railway transportation issues continue to impact the industry.

Ethanol Report on New Advocacy App

Algal Industry Questions Focus on Biofuels, America

Matt Carr, joined the Algae Biomass Organization this past June as the executive director coming from the BIO (Biotechnology Industry Organization) where he was introduced to algae and the algae story and he thought this is where the country should be going in terms of sustainable fuels. Carr joined Joe Jobe, NBB and Michael McAdams, Advanced Biofuels Association on a panel to give attendees of the 2014 National Advanced Biofuels Conference a policy update and industry outlook for advanced biofuels.

“We’re in a tough spot,” said Carr when asked the state of the algal industry. “The advanced biofuels sector grew up on the backs of strong federal policy support, R&D funding from the Department of Energy in the early days along with the nabce-14-carrRenewable Fuel Standard (RFS) and tax policy. Right now all of those areas are uncertain and its causing our members and other across the advanced biofuels industry to question their focus on fuels and their focus on America and to look at other markets in other countries to potentially deploy that technology.”

With elections coming up, Carr was asked if he thinks the political environment will change. He said that the industry is at a point now where it has to see something change. “When we have conservative Republicans recognizing its Washington getting in the way of American innovation and job creation we’ve reached a tipping point.”

What stood out for Carr as part of the panel was the shared sense of frustration with Washington. But he is hopeful that both sides of the spectrum can come together and recognize the opportunity the country has in advanced biofuels.

Interview with Matt Carr, Algae Biomass Organization
Remarks from Matt Carr, Algae Biomass Organization

2014 National Advanced Biofuels Conference & Expo Photo Album

Coverage of The Advanced Biofuels Conference and Expo is sponsored by
Coverage of The Advanced Biofuels Conference and Expo is sponsored by New Holland

Tips for Biofuel Investment In Turbulent Times

As a biofuels plant, how do you make sound plant management and investment decisions in an environment of political turmoil? This was the theme of one of the panel discussions during the 2014 National Advanced Biofuels Conference that nabc plant management paneltook place in Minnesota this week. The conversation focused on how the uncertainty surrounding the Renewable Fuel Standard (RFS) that has not been finalized for 2014 as of this writing, affects decisions made for biofuels plants. The panelists discussed tips and strategies on how they try to keep their business healthy and growing while also trying to position themselves for continued, future success.

Insights were given by Mike Jerke, CEO, Guardian Energy Management LLC; Brian Kletscher, CEO/General Manager, Highwater Ethanol; and Randall Doyal, CEO/General Manager, AL-Corn Clean Fuel who all run currently operating ethanol production facilities. While each one pointed to the prices of feedstocks as being the number one cost of production (feedstock costs are 80 percent of a plant’s production costs) there are other ways to streamline efficiencies to stay competitive and one strategy is to diversify into bolt on advanced biofuels technologies.

Doyal noted that the big takeaway for the attendees was that the existing ethanol industry is looking at those next generation biofuel opportunities. “They look down the road all the time, and that the existing ethanol plants are not Gen 1 – we’re way down the road from Gen 1. We’re far more advanced than that and we look forward to bringing that type of thinking into advanced biofuels,” Doyal said.

When focusing on policy, Doyal said policy directly affects a plant when it decides how to deploy its capital. “If you have uncertainty in policy, it creates an uncertain environment in the lending community and it creates uncertainty in your own board room.”

Doyal stressed, “If you don’t have good, consistent, clear policy, it’s hard to figure out your path forward.”

Listen here to Chuck’s interview with Randall Doyal speaking about how policy uncertainty affects plant decisions: Interview with Randall Doyal, AL-Corn Clean Fuel

Click here to listen to the comments of the three panelists:
Remarks from Mike Jerke, Guardian Energy Management
Remarks from Brian Kletscher, Highwater Ethanol
Remarks from Randall Doyal, AL-Corn Clean Fuel

2014 National Advanced Biofuels Conference & Expo Photo Album

Coverage of The Advanced Biofuels Conference and Expo is sponsored by
Coverage of The Advanced Biofuels Conference and Expo is sponsored by New Holland

NBB Cautiously Optimistic About RFS

“We’ve exceeded the goals of advanced biofuels. Then we had the devastating proposed rule that has gone on for a year now. We are cautiously optimistic that we’ll have something here within the next few weeks and that it will be positive,” said Joe Jobe, CEO of the National Biodiesel Board (NBB) who was one of the panel members of panel that discussed federal biofuels policy and the long-term prognosis of the advanced biofuels industry. The discussion was part of the National Advanced Biofuels Conference that recently took place in Minnesota and also included a robust discussion on the Renewable Fuel Standard (RFS).

nabce-14-Joe Jobe NBBJobe noted that the biofuels industry and particularly the advanced biofuels industry is beleaguered. “We’ve been under attack by uncertain policy signals, but we need to keep up the fight and double down on the fight. We need to get more of our message out there. We need to get more involved in policy advocacy, we need to get the RFS working again,” said Jobe.

The industry has demonstrated the RFS can work well said Jobe. “We created it to be a stable energy policy.”

Last year was a record breaker for the biodiesel industry – it grew from producing just over one billion gallons in 2012 to just under 2 billion gallons in 2013. “Advanced biofuels are here. The industry has exceeded the goals of advanced biofuels,” Jobe stressed.

The policy discussion will continue during the 2015 National Biodiesel Board Conference & Expo taking place in Ft. Forth, Texas January 19-22. Registration is open.

Jobe urges the industry to step up its advocacy efforts and its policy efforts to ensure the future of the advanced biofuels industry.

Interview with Joe Jobe, National Biodiesel Board
Remarks from Joe Jobe, National Biodiesel Board

2014 National Advanced Biofuels Conference & Expo Photo Album

Coverage of The Advanced Biofuels Conference and Expo is sponsored by
Coverage of The Advanced Biofuels Conference and Expo is sponsored by New Holland

State of the Advanced Biofuels Industry

nabce-14The National Advanced Biofuels Conference & Expo opened with a conversation about the current state of important federal biofuels policies, including the status of the Renewable Fuel Standard (RFS).

Among those on the opening panel was Michael McAdams, founder and president of the Advanced Biofuels Association, who talked first about the state of his industry. “There’s an old expression ‘you’re either the bug or the windshield,'” he said. “Unfortunately, in my own association, about 15% (of my members) have become bugs.”

nabce-14-mcadamsThe reason for that, says McAdams, is the uncertainty surrounding federal biofuels policy. “The partnership between the federal government and industry has to have clarity and certainty,” he said. “What we haven’t had in the last two years is certainty for the people I represent in the advanced and cellulosic sector.”

In an interview after the panel, McAdams described the state of the advanced biofuels industry right now as being in “suspended animation” waiting for clarification on policy including volume obligations under the RFS and pathways for new technologies.

Regarding the RVO, McAdams notes that at this point, with no final numbers for this year yet, the administration needs to be focused on rulemaking for 2015. “I’m assuming the week after the election or maybe Friday before the election we’ll see the numbers (for ’14),” said McAdams. The problem with that is that the 2015 numbers are due November 30 “so one could make a rational case that the numbers they actually publish are the numbers for ’15, not for ’14.” He adds that the administration has already said they expect it will be February before they proposed the 2015 volume obligations.

McAdams urges the advanced biofuels industry to keep working “to deliver the innovative fuels of the future.”
Interview with Mike McAdams, Advanced Biofuels Association
Remarks from Mike McAdams, Advanced Biofuels Association

2014 National Advanced Biofuels Conference & Expo Photo Album

Coverage of The Advanced Biofuels Conference and Expo is sponsored by
Coverage of The Advanced Biofuels Conference and Expo is sponsored by New Holland

Preview of Advanced Biofuels Conference

National Advanced Biofuels ConferenceThe National Advanced Biofuels Conference & Expo is underway in Minneapolis. Our first panel is moderated by BBI’s Tim Portz, VP of Content. This panel, talking about “Assessing the Health of Federal Biofuels Policy and Its Long Term Prognosis,” includes Joe Jobe, National Biodiesel Board, Mike McAdams, Advanced Biofuels Association and Matt Carr, Algae Biomass Organization. I’ll have more from their comments later.

I spoke with Tim to get a preview of what we’ll be doing here. He says it is an interesting time for the industry with some great successes happening in the advanced biofuels category. However, the industry is still struggling with the on-going uncertainty with the RFS. He is interested to hear from industry members who will be participating on panels and talking about this topic.

You can listen to my interview with Tim to learn more about what’s going on at this year’s conference: Interview with Tim Portz

2014 National Advanced Biofuels Conference & Expo Photo Album

Coverage of The Advanced Biofuels Conference and Expo is sponsored by
Coverage of The Advanced Biofuels Conference and Expo is sponsored by New Holland

Ethanol Report on 2014 Export Exchange

ethanol-report-adComing up October 20-22 is the 2014 Export Exchange sponsored by the Renewable Fuels Association (RFA) and the U.S. Grains Council (USGC) to bring international coarse grain buyers and U.S. suppliers together, with a particular focus on the ethanol co-product distillers dried grains with solubles – better known as DDGS or distillers feed.

2014-export-exchangeThis edition of the Ethanol Report features comments from RFA president and CEO Bob Dinneen, USGC president and CEO Tom Sleight, and industry relations director Lyndsey Erb-Sharkey.

Ethanol Report on 2014 Export Exchange

Cellulosic Making Progress Despite Uncertainty

Advanced and cellulosic biofuels producers continue to press the administration for certainty in the Renewable Fuel Standard (RFS) to continue making investments for future expansion.

“Today we’re at the start, like oil was 160 years ago, or corn ethanol was four years ago, said Steve Hartig with POET-DSM Advanced Biofuels during a teleconference organized by the Biotechnology Industry Organization (BIO) highlighting progress in the industry. His company just celebrated the grand opening of a cellulosic ethanol plant in Iowa. “We have invested hundreds of millions of dollars in this and are convinced cellulosic ethanol will be a key part of our future energy mix.”

Abengoa Bioenergy plant in Hugoton, KS

Abengoa Bioenergy plant in Hugoton, KS

Chris Standlee with Abengoa Bioenergy said his company is also invested substantially in commercializing cellulosic ethanol technology. “Abengoa’s been working on perfecting this technology for over 10 years,” said Standlee, adding that their plant will be holding a grand opening in Hugoton, Kansas next month.

Also participating in the teleconference was Vonnie Estes with GranBio, a plant being built in Brazil using sugarcane straw and bagasse as feedstocks. She noted that the uncertainty of the RFS is impacting their plans because they intend to export at least half of their plant’s production to the U.S. “The company has spent over $200 million in capital on this plant,” she said. “The plant (will be) really good for the U.S. in that it’s a source of low carbon fuels into the market.”

All three company representatives noted that they are postponing decisions to increase production of cellulosic biofuels due to the uncertainty created by EPA.

BIO teleconference on cellulosic ethanol advancements