Domestic Fuel

The Environmental Protection Agency has announced proposed Renewable Fuel Standard (RFS2) amendments and clarifications, which include new pathway determinations for advanced biofuels such as isobutanol and ethanol from crop residues.

The EPA proposal also includes “various changes to the E15 misfueling mitigation regulations (E15 MMR) which are minor technical corrections and amendments to sections dealing with labeling, E15 surveys, product transfer documents, and prohibited acts” as well as changes to the survey requirements associated with the ultra-low sulfur diesel (ULSD) program.

EPA is proposing to allow renewable diesel, renewable naphtha, and renewable electricity (used in electric vehicles) produced from landll biogas to generate cellulosic or advanced biofuel RINs. Renewable compressed natural gas (CNG)/liquified natural gas (LNG) produced from landfill biogas are also proposed to generate cellulosic RINs. EPA is also proposing to allow butanol that meets the 50% GHG emission reduction threshold to qualify as advanced biofuel. The rulemaking also proposes a clarication regarding the definition of crop residue to include corn kernel ber and proposes an approach to determining the volume of cellulosic renewable identication numbers (RINs) produced from various cellulosic feedstocks. Further, this proposal discusses and seeks comment on the potential to allow for commingling of compliant products at the retail facility level as long as the environmental perfor­mance of the commingled fuels would not be detrimental. The action also addresses “nameplate capacity” issues for certain production facilities that do not claim ex­emption from the 20% GHG reduction threshold. Several other amendments to the RFS program are included.

“This proposed rulemaking package is essentially a collection of ‘housekeeping amendments’ that will address several odds and ends that needed to be addressed in the regulatory text,” commented Renewable Fuels Association president and CEO Bob Dinneen. “We are pleased that among these proposed amendments is a provision clarifying that ethanol produced from the cellulosic portions of the corn kernel can qualify as cellulosic biofuel under the RFS2.”

“Companies continue to make investments, put steel in the ground, create jobs and develop technologies that reduce dependence on foreign oil and contribute to a cleaner environment,” said Brent Erickson, executive vice president of the Biotechnology Industry Organization’s (BIO) Industrial & Environmental Section. “They are preparing to make additional investments with assurance that U.S. policy is committed to energy security and production of biofuels.”

The proposal has been submitted to the Federal Register for public comment.

A fancy title does not good biofuels policy make.

Mixed emotions are emanating from the introduction of the “Foreign Fuels Reduction Act,” introduced by U.S. Senators Joe Manchin (D-W.Va) and Bob Corker (R-Tenn). The legislation would allow only domestically-sourced fuels to be used to meet the requirements of the Renewable Fuel Standard (RFS).

“It is time for America to create an all-of-the-above energy policy that will help lead us to energy independence,” Manchin said. “It’s simply common sense to use all of our resources, and that includes non-food based biofuels. I am proud to cosponsor this bill with my good friend Senator Bob Corker to make sure that we continue to develop domestic non-food based biofuels while stopping the current system’s incentives to import food-based ethanol products from foreign countries.”

According to Corker, the RFS is having some unintended consequences. “This bill is a common sense step toward potentially mitigating gasoline price increases the RFS may contribute to in the near future,” he said. “Because its mandated biofuels volumes are too high, the RFS is also unintentionally incentivizing ethanol imports.  Our bill helps to correct that problem by more properly aligning mandated levels with what we produce domestically.”

The potential challenge with the bill? It would require a reduction in the volume of cellulosic biofuel required under the RFS. It would also result in a pro rata reduction to the total volume of renewable fuel and advanced biofuels,a fight many anti-biofuel camps have been engaged in for years. While this would “ensure” only domestically produced biofuels are used, it would lower the total amount required until production levels ramp up significantly.
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The demonstration cellulosic ethanol plant owned by Edeniq and located in Visalia, California has exceeded 1,000 hours of continuous operation. The corn-to-cellulosic migration plant uses the company’s proprietary technology to process more than one metric ton of feedstock per day into cellulosic ethanol. According to the company, this achievement exceeded the plant’s initial target. The project, funded in part by a U.S. Department of Energy (DOE) grant, is being used to demonstrate the viability of producing ethanol in a cost-effective manner from non-food sources including corn stover, switchgrass and woodchips.

In addition to achieving over 1,000 hours of continuous operation, the plant sustained and exceeded the DOE’s target of at least 90 percent up time demonstrating over 95 percent operational reliability. In addition, the facility promotes the use of sustainable resources including reusing or recycling substantial portions of its water to meet process demands, according to a company press release.

“While we have been developing these ethanol technology solutions for years, being able to fully integrate and operate our own plant has given us invaluable, deeper insight into the intricacies of the process and has enabled us to continuously improve our core technologies and operations,” said Thomas P. Griffin, chief technology officer at Edeniq. “The DOE has been a tremendous leader and driver in moving US interests toward the commercialization of advanced biofuels, and we look forward to further collaboration with them in the pursuit of this shared mission.”

The next step for Edeniq is to continue operations of the plant under the co-sponsorship of the California Energy Commission. The plant will undergo further process enhancements toward the production of low-cost sugars from a range of biomass and agricultural waste sources, including those indigenous to California. Edeniq is also working with companies to implement larger scale facilities based on the successful testing and operations of its demonstration plant.

Researchers at the U.S. Department of Agriculture have developed a new strain of yeast that could cut the costs of cellulosic ethanol production. This Agricultural Research Service (ARS) news release says the work is being done at the agency’s National Center for Agricultural Utilization Research in Peoria, Ill.

ARS molecular biologist Zonglin Lewis Liu and his colleagues determined that this yeast strain can break down and ferment the sugars in corn cobs left behind after the compound xylose—which is sometimes used for industrial activities—has been extracted. The new strain of yeast, Clavispora NRRL Y-50464 (Y-50464), can tolerate cob-derived compounds that interfere with yeast growth and fermentation rates.

The scientists added the enzymes cellulase and beta-glucosidase, which are often used to break down residues and extract sugars, and observed that Y-50464 reached its peak ethanol production rate of 25.7 grams per liter 5 days after the experiment began. But the yeast actually produced more ethanol, 26.6 grams per liter in 5 days, without the addition of beta-glucosidase.

Confirmation of beta-glucosidase in Y-50464 will eliminate the need to include the cost of that additional enzyme to the process.

Earlier this month, Hall of Fame recording artist Neil Young stopped by Sioux Falls, South Dakota to fill up his LincVolt with POET-DSM cellulosic ethanol. LincVolt is a hybrid-electric 1959 Lincoln Continental with onboard charging powered by cellulosic ethanol. He’s on a cross-country tour to highlight renewable energy.

During his visit, Young said you don’t see much about what is going on with the climate in the media. “It’s just not a fast moving subject. It’s a slow moving big story. But it’s not going to be going away unless we do something.”

He supports American-made fuel and noted that when he filled up with cellulosic ethanol, his vehicle is able to get an 80 percent reduction in carbon dioxide emissions (CO2) over traditional gasoline. “This is just incredible for the planet,” added Young.

Check out the video here and I must say his refurbished Lincoln is “DYNOMITE”.

A big issue for biofuels producers, especially those in the cellulosic branch, is trying to come up with enzymes that can crack the multitude of biomass structures to unlock the sugars within, and thus, unlock the fuel trapped within.

“The enzymes have always been one of the Achilles’ heels of the cellulosic side,” Mark Emalfarb, CEO of Dyadic International, a biotech company that turns DNA into the proteins and enzymes for a variety of uses, including biofuels production, told me at the recent Advanced Biofuels Leadership Conference. “We have a fungal cell that we have created from a Russian fungus that for the last 20 years we’ve developed into a protein factory,” encoding genes with different enzymes to get the sugars for biofuel production.

Because there are differences in what will unlock the sugars every biomass variety, Mark says Dyadic’s process is helpful because it can make all these different enzymes from one fungal cell and one fermentation. “We’re not making five different fermentations and blending five different enzymes together, it’s all produced simultaneously out of the same cell line.” He points to one of their licensees, Abengoa Bioenergy, building a 25 million gallon cellulosic ethanol plant in Kansas, which using this technology allows them to make their own enzymes for half the cost … sometimes the difference between operating in the red or in the black.

“This enables you to do things you couldn’t do before, and to do them on-site without the profit margins the enzyme companies want to charge will make the difference,” Mark says.

Listen to more of my interview with Mark here: Mark Emalfarb, CEO of Dyadic

According to a new report by @GlobalDataEnergy, #bioethanol is the car fuel of the future. The report, “#Cellulosic Ethanol – Global Production, Major Trends, Regulations, and Key Country Analysis to 2020,” finds that #ethanol is the most widely acclaimed alternative or additive for gasoline used for running vehicles. In addition, the U.S. ranked number one in biofuel production using natural waste feedstocks. According to the latest report, the U.S. is the global leader in cellulosic ethanol production, manufacturing 5.42 million gallons in 2012.

Bioethanol is produced through the fermentation of cellulosic feedstock such as forest and agricultural waste. The reports finds that the U.S. has an abundance of biomass feedstock, and dedicated energy crops such as #switchgrass and #miscanthus that are grown exclusively for conversion into cellulosic ethanol to help the nation’s ambition to meet fuel needs while reducing greenhouse gas (GHG) emissions.

The U.S. is the only country currently working to promote the cellulosic ethanol market, says the report, with the U.S. Department of Energy (US DOE) providing grants to help companies establish a commercial-scale cellulosic ethanol plant. As a result, several companies have set up pilot and demonstration plants and a few commercial plants are expected to be commissioned in late 2013. The report also finds that the U.S. have also mandated the addition of 10% ethanol in gasoline fuel, setting steady domestic demand for the industry, while certain recently released cars are able to run on a 85 percent ethanol, 15 percent gasoline mix.

The report finds corn stover and wheat straw are among the most freely available types of feedstock used in countries producing cellulosic ethanol, and growing ethanol demand may see these nations utilizing the residue of their corn crop for ethanol production, creating a sizable market for agricultural waste. GlobalData expects that the growing feedstock demand will create a structured market, in which biomass feedstock prices will be set based on their ethanol yield and the prevailing trading price of ethanol.

Some EU countries such as France and Italy have cellulosic ethanol production infrastructure, but a limited supply of biomass feedstock. Growth of commercial production in these countries may fuel the need to import feedstock from nearby countries or expand production to other countries with ample feedstock availability. A few producers with upcoming commercial scale plants in the U.S. have already started signing agreements to procure agricultural residue and other kinds of cellulosic feedstock.

Global cellulosic ethanol is expected to increase from 14.25m gallons in 2012 to 412.25m gallons in 2020, with commercial production anticipated to take off on a large scale in late 2013 and 2014, thanks to major players adding substantial production capacity and new companies joining the market. The report finds that the U.S. is expected to retain its market dominance until 2020.

How can we tell the Renewable Fuels Standard (RFS) is working? By how nervous it’s making the big oil companies. That was the message attendees at the Advanced Biofuels Leadership Conference near Washington, D.C. heard.

“We are disrupting an existing marketplace,” says Brooke Coleman, Executive Director of the Advanced Ethanol Council. “We are not social media. We are not creating a new search engine. We are not doing something new… we just happen to be doing what other people are doing, better.”

Brooke says that has made some pretty powerful enemies of biofuels, who are spending a lot of money to destroy the biofuel brand … from corn ethanol to biodiesel to cellulosic biofuels. But he’s confident their attempt to change the Clean Air Act, and thus the RFS, will fail, ultimately because of the political allies biofuels have made.

“You’ve got Republicans and Democrats who see this thing [RFS] work, create jobs … just shy of 400,000 … and it’s just hard to change,” adding the political environment is not conducive to wholesale changes to either the Clean Air Act or the RFS.

Brooke says the diverse group that makes up the biofuels coalition is more together than ever, with efforts like Fuels America, a coalition to protect the RFS and the renewable fuels industry, and more collaboration than ever … without getting hung up on differences within the biofuels sector.

“We don’t agree on everything, [but] the trick is not to get so focused on the one or two things we don’t agree on … and focus on what we DO agree on.”

Listen to more of my interview with Brooke here: Brooke Coleman, AEC

A coalition of biofuel producer organizations the reconsideration of the 2011 cellulosic obligation under the Renewable Fuel Standard (RFS).

In January 2013, the U.S. Court of Appeals for the D.C. Circuit ordered the Environmental Protection Agency (EPA) to reconsider the 2012 Renewable Fuel Standard obligation for cellulosic biofuels. EPA has implemented the Court’s order and is now voluntarily reconsidering the 2011 obligation for cellulosic biofuels, which is the subject of a separate lawsuit before the Court.

In a joint statement, organizations that make up the Biofuel Producers Coordinating Council, noted that the “RFS was established to open the U.S. transportation fuel market to renewable fuels, and it ensures that the market remains open as cellulosic biofuel production starts up. The program has worked. Advanced biofuel companies across the United States have invested in technology development and construction of first-of-a-kind commercial scale refineries for cellulosic and other advanced biofuels. EPA’s implementation of the Court order does not impact the industry’s progress in developing technologies that reduce dependence on foreign oil and contribute to a cleaner environment.

The industry remains focused on starting up production this year and increasing it in years to come. We look forward to working with EPA to establish 2013 targets that are consistent with expected production volumes this year from the facilities that have already been built.”

Intervenors in the case included the Advanced Biofuels Association (ABFA), Advanced Ethanol Council (AEC), American Coalition for Ethanol (ACE), Biotechnology Industry Organization (BIO), Growth Energy, and Renewable Fuels Association (RFA).

Want to feel good about Internal Revenue Service this time of year? Well, maybe you won’t be doing the wave for tax collectors, but the IRS is helping out those filing tax credit claims for biodiesel mixtures and alternative fuels sold or used in 2012. Biodiesel Magazine explains that several fuel tax credits, including the cellulosic biofuel producer credit, the biodiesel mixture credit, the alternative fuels credit and the alternative fuel mixtures credit, expired at the end of 2011. But with the passage of the deal on January 2 this year that extended those 2012 credits retroactively, if eligible, you’ll have until July 1 to file for them:

The deadline for filing claims for certain refundable excise tax credit payments had already passed before the [American Taxpayer Relief Act] was enacted. Such claims generally are due by the end of the first quarter following the earliest quarter of the claimant’s income tax year included in the claim. For example, a calendar-year taxpayer’s claim for biodiesel mixtures sold in June and July 2012 ordinarily would have been due by Sept. 30, 2012 (the end of the third quarter, which is the first quarter following the earliest quarter included in the claim). Earlier this year, the IRS released FAQs on its website that explained the procedural requirements for claiming the income tax and excise tax credits in light of ATRA. The FAQs did not extend the filing deadlines for claiming the refundable excise tax credits.

More information is available in IRS issued Notice 2013-26.

USDA has announced a new collaboration with DuPont to promote sustainable harvesting of bio-based feedstocks for cellulosic ethanol.

The joint agreement between USDA’s Natural Resource Conservation Service (NRCS) and DuPont aims to set voluntary standards for the sustainable harvesting of agricultural residues for renewable fuel, and supports rural job creation, additional income for farmers, bio-based energy development, and the safeguarding of natural resources and land productivity.

“USDA and DuPont share a common interest in the wise use and management of soil, water and energy resources,” said Agriculture Secretary Tom Vilsack. “Both organizations also share an interest in helping individual farmers adapt to new market opportunities in ways that are consistent with the wise use of these natural resources.”

“Working with farmers is critical to maximizing the land’s productivity and protecting natural resources,” said Jim C. Borel, executive vice president of DuPont. “With this new collaboration, we have a partner in the Natural Resources Conservation Service to ensure that the collection of corn stover for the production of cellulosic renewable fuel makes sense for an individual grower’s operation and the land they farm.”

Under the agreement, NRCS will provide conservation planning assistance for farmers who supply bio-based feedstocks to biorefineries as the industry begins to commercialize. Conservation plan, written for individual operations, will ensure sustainable harvest of corn crop residues while promoting natural resource conservation and land productivity. A conservation plan is a voluntary document, written in cooperation with farmers, which helps them protect natural resources while promoting a farm’s economic sustainability.

According to several sources, Mascoma Corporation has withdrawn its registration for its planned initial public offering (IPO). The company had hoped to raise as much as $100 million through the offering. The biofuel company has been focused on developing enzymes for breakdown of sugars in the cellulosic ethanol production process.

In a filing, the company said it had determined not to proceed at this time with the offering due to market conditions. Mascoma is the fourth biofuel company to cancel or delay IPO’s since last year. Enerkem Inc. canceled its planned IPO in April, followed by Fulcrum BioEnergy Inc. in November, and Coskata Inc. shelved its deal in July.

According to Purdue University researchers, removing corn stover from agricultural fields to produce cellulosic ethanol requires careful management to avoid adding greenhouse gas emissions and soil erosion to the environment. However, environmental impacts from stover removal can be reduced by switching to no-till corn or adding winter cover crops, but these practices likely would increase production costs, researchers reported in a study, “Environmental and Economic Trade-Offs in a Watershed When Using Corn Stover for Bioenergy,” published in Environmental Science & Technology.

“Some crop rotation and tillage combinations are more environmentally benign than others,” said Ben Gramig, a Purdue agricultural economist and the study’s lead researcher. “But there are water quality and greenhouse gas tradeoffs when collecting stover.”

As Gramig explains, stover is the parts of a corn plant that remain after grain harvest. Greenhouse gases from cropfields are released into the atmosphere when carbon escapes disturbed soils during stover removal. Emissions also occur when nitrogen fertilizer is applied to the land or crop residues decompose. Plowing fields loosens soil and, when combined with removing stover, causes increased soil erosion.

The study examined the environmental effects and costs of stover collection from eight corn-soybean rotation and continuous corn systems in a watershed typical of the eastern Corn Belt. The comparisons were made by combining results from watershed and greenhouse gas computer simulation models and minimizing the cost of stover collection, to select which farming practices to use in an agricultural watershed.

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Leaders of Fuels America held a press conference this morning to “preemptively answer misinformation on renewable fuel blends and gasoline prices” in a new report by the American Petroleum Institute.

Speaking in defense of the renewable fuels industry were the heads of several industry organizations and companies, including Growth Energy CEO Tom Buis, Renewable Fuels Association CEO Bob Dinneen, Advanced Ethanol Council Executive Director Brooke Coleman, Biotechnology Industry Organization CEO Jim Greenwood, Adam Monroe with Novozymes and Chris Standlee with Abengoa.

Listen to the entire press conference here: Fuels America Press Conference

KiOR, Inc. has announced the initial shipments of cellulosic diesel from its commercial scale facility in Columbus, Mississippi. The biorefinery uses pine wood chips and produces gasoline and diesel, the first renewable hydrocarbon fuels in the U.S. manufactured at commercial scale with no compatibility issues. KiOR’s renewable gasoline is also the first renewable cellulosic gasoline ever registered by the Environmental Protection Agency for sale in the U.S.

“This is a major step forward for KiOR, the biofuels industry and the entire renewable fuels sector,” said Fred Cannon, KiOR’s President and Chief Executive Officer. “With first production at Columbus, KiOR has technology with the potential to resurrect each and every shut down paper mill in the country and to replace imported oil on a cost effective basis while creating American jobs.”

Cannon continued, “This facility demonstrates the efficacy of KiOR’s proprietary catalytic biomass-to-fuel process with the potential to deliver cellulosic gasoline and diesel to the U.S. We are proud to be making history in Mississippi. The technology is simply scalable and we believe sufficient excess feedstock exists in the Southeast alone to build almost fifty KiOR commercial scale facilities.”

Haley Barbour, former Governor of Mississippi, was instrumental in attracting KiOR to Mississippi. He said of the event, “The shipment of this first fuel from KiOR’s Columbus, Mississippi, facility is the culmination of a vision to establish Mississippi as the birthplace of the wood-to-fuels production technology. This progress highlights our highly skilled labor force, abundant natural resources and supportive government climate for innovative companies like KiOR seeking a home to expand their businesses.”