Domestic Fuel

Aventine Renewable Energy plans to resume work next month on its ethanol plant located in Canton, Illinois.

In September 2011, Aventine announced it was delaying work on the plant due to uncertainty surrounding its ability to secure critical third-party technical and engineering support. Since that time, the company has secured the support necessary to move the project forward and now anticipates resuming work in early March 2012 with production expected to start this summer.

“Now is the time to move forward with this project. We have secured the critical third-party support necessary for the commissioning process. Additionally, we currently have approximately $50 million of combined cash and availability under our revolver,” said John Castle, Chief Executive Officer.

The Pekin, Illinois-based ethanol producer emerged from Chapter 11 restructuring in March 2010 after filing in February of the previous year.

An Australian ethanol producer has received the first completed commercial certification from the Roundtable on Sustainable Biofuels (RSB).

The Manildra Group, through its subsidiary Shoalhaven Starches Pty Ltd, produces bioethanol from starchy wastewater generated by their wheat processing facility in New South Wales, Australia. The RSB certification means that “Manildra offers tangible evidence that sustainable biofuels may be efficiently and economically produced at a large scale while adhering to ambitious social and environmental standards.”

The RSB Certification System allows farmers, feedstock processors and biofuel producers to demonstrate that their operations comply with ambitious yet practical safeguards, including, but not limited to, the protection of natural or rare ecosystems, food security, and the respect of human rights
to land, water and decent work conditions, and the management of water resources.

The Roundtable on Sustainable Biofuels is a multi‐stakeholder initiative launched and hosted by the Energy Center of Ecole Polytechnique Fédérale de Lausanne (EPFL), Switzerland.

The Ethanol Committee of the National Corn Growers Association met in Kansas City this past week week to consider the challenges and opportunities facing the industry.

“The market for ethanol has grown exponentially over the past decade, thus utilizing an abundance of corn to meet the already-present need for a renewable, domestic biofuel,” said Chad Willis, a Minnesota corn grower who serves as chairman of the committee. “Now, we face a myriad of challenges and opportunities as those in the industry continue to innovate while some outside of it continue attempts to deny ethanol’s incredible value to our nation.”

“After years of hearing rehashed iterations of the food-and-fuel debate, we found the tour of LifeLIne to be both interesting and inspiring,” Willis said. “Companies such as this demonstrate that, through a mixture of creative thought and hard work, we can find new ways to use corn even more productively and solve an array of societal needs.”

The committee of farmer leaders from around the Corn Belt also had the opportunity to meet the NCGA’s new Director of Biofuel Programs and Business Development Pam Keck, who is a scientist and educator with more than 20 years of experience in the agricultural and biofuels industry, academia and not-for-profit research.

Keck most recently contracted with Monsanto, coordinating an outreach program that brought together schools and scientists. She has previously taught chemistry at Southern Illinois University, Edwardsville and at Lewis and Clark Community College. She has also served as assistant director of workforce development and scientific projects at the National Corn-to-Ethanol Research Center.

The president of the Renewable Fuels Association (RFA) is calling a bill approved by a House subcommittee Tuesday yet another stall tactic to the use of higher ethanol blends in fuel.

RFA’s Bob Dinneen says the legislation sponsored by Congressman Jim Sensenbrenner (R-WI) injects “parochial politics into the scientifically established process of approving new fuels.”

“In approving E15, the Department of Energy tested vehicles over millions of driving miles – the equivalent of some 4,700 round trips from Washington to Milwaukee,” said Dinneen in a statement. “To suggest more testing is needed is nothing more than a stall tactic that has but one outcome – our continued addiction to oil.”

Dinneen adds that the concerns raised in the bill are “largely superficial and do not require the intervention of Congress to resolve. America’s ethanol industry has been working with auto companies and fuel suppliers for over a year to address any concerns and misconceptions that persist. This bill would reverse the progress private industry has already achieved and threaten the job creation that would stem from an increased use of domestic renewable fuels.”

POET is targeting dairy producers with the introduction of a new low-fat distillers grains product.

The South Dakota-based ethanol producer notes that research indicates its new Dakota Gold Low Fat dried distillers grains with solubles (DDGS) can be fed to dairy cattle at a higher inclusion rate than traditional DDGS.

According to Kip Karges, PhD, Technical Services and Research Director at POET Nutrition, the product has just a 5 percent fat content, which offers a new opportunity for dairy operations that have had to limit DDGS use in the past because DDGS fat content can cause milk fat depression issues. “Dairy operations can feed more low fat DDGS to their livestock by using Dakota Gold Low Fat,” Karges said. “That will allow for optimum milk production while lowering ration cost.”

General research into the subject has shown that increasing concentrations of low-fat distillers grains have correlated to increasing efficiency of milk production. “When feeding regular DDGS you really have to limit feeds with high levels of unsaturated fatty acids and may cause limitations in formulation procedures,” said Paul Kononoff, Associate Professor of Dairy Nutrition/Dairy Nutrition Specialist at the University of Nebraska in Lincoln. “The reduction in fat in low fat DDGS allows for higher inclusion of the co-product without the worries of milk fat depression.” Kononoff and others as the University of Nebraska have performed trials for POET and will be releasing their data to the public this summer.

A deliberate research and development process was followed in bringing Dakota Gold Low Fat DDGS to market. The new Dakota Gold LF DDGS option is possible because of POET’s Voila™ Corn Oil production, which removes oil from DDGS. The resulting low fat DDGS have been researched and will continued to be researched to find new ways in which distillers grains, the second-largest traded feed ingredient on the market, can be used to produce protein for human consumption. Nutritionists at POET are providing animal research data to nutritionists and the feed industry in general regarding Dakota Gold LF DDGS. Research and nutrition details are available at the Dakota Gold website.

Legislation sponsored by Rep. James Sensenbrenner (R-WI) could delay getting 15% ethanol blended fuel in the marketplace by requiring even more testing by the Environmental Protection Agency.

The bill out of the Science, Space, and Technology Committee’s Energy and Environment Subcommittee has the backing of numerous anti-ethanol organizations, including the including petroleum, livestock, environmental and food industry groups. It would require EPA to contract with the National Academy of Sciences to study the effects of E15 on vehicles and engines. “The EPA’s decision to rush introduction of E15 into the marketplace raised a red flag, and stakeholders are speaking out before it’s too late,” Sensenbrenner said.

Growth Energy CEO Tom Buis notes that E15 has been tested more than any other fuel in history. “This is a waste of time and a waste of taxpayer dollars,” Buis said. “No fuel blend has undergone the level of scrutiny E15 has – and passed the tests like E15 did. They’ve been looking at E15 for more than three years.”

The Green Jobs Waiver for E15 was accompanied with more independently-gathered data, science and research in its support than any of the other 11 Clean Air Act waivers previously approved by the U.S. EPA. The agency approved the use of E15 in vehicles newer than 2001 more than a year ago, but it has yet to reach the consumer marketplace.

*Updated with clarification comments from UNICA*

The president of the Renewable Fuels Association (RFA) this week wrote a letter to the U.S. Trade Ambassador asking for an investigation into news that the Brazilian state of Sao Paulo was imposing a 25% tax on all imported ethanol.

“Because ethanol produced in Sao Paulo is tax exempt, ethanol imported into Sao Paulo from the United States and other areas is at a substantial economic disadvantage,” wrote RFA President and CEO Bob Dinneen to Ambassador Ron Kirk. “We believe this action is discriminatory and may severely—and immediately—restrict the exportation of U.S. ethanol to Brazil.”

Dinneen is pictured here sharing a lighter moment with Marcos Jank, president and CEO of Brazil’s UNICA during a session at the 2011 National Ethanol Conference.

In early December, the nation of Brazil extended a temporary suspension of a 20% federal tariff on imported ethanol.
“This action not only effectively reinstates the tariff on U.S. exports, but increases it by 5%,” wrote Dinneen. “Moreover, we believe the action taken by the state of Sao Paulo is in violation of Article III:4 of the Generalized Agreement on Tariffs and Trade (GATT) and possibly Article 2.1 of the World Trade Organization’s (WTO) Technical Barriers to Trade Agreement.

Port Santos in Sao Paulo is the main port of entry for U.S. ethanol exports to Brazil, which accounted for an estimated 400 million gallons in 2011.

*In response to the RFA’s letter and resulting media reports, UNICA released a statement from president Marcos Jank noting that the Sao Paulo tax is a pre-existing value-added tax (VAT), known as ICMS (Goods and Services Tax), which is not equivalent to the return of Brazil’s tariff on imported ethanol.

According to UNICA, the deferment period started on October 1, 2011 and is now scheduled to end on March 1, 2011.

Novozymes has announced a new research agreement that will explore enzymatic technology to produce fuel ethanol, fine chemicals, and protein from seaweed.

The industrial biotech firm has entered into an agreement with India-based Sea6 Energy to jointly develop a process for the production of biofuels from seaweed. The research alliance will use enzymes to convert seaweed-based carbohydrates to sugar, which can then be fermented to produce ethanol for fuel, fine chemicals, proteins for food, and fertilizers for plants.

Novozymes will research, develop, and manufacture enzymes for the conversion process, while Sea6 Energy contributes its offshore seaweed cultivation technology. “Seaweed is a natural complement to our efforts to convert other types of biomass to fuel ethanol,” says Per Falholt, Executive Vice President and CSO of Novozymes. “More than half of the dry mass in seaweed is sugar, and the potential is therefore significant.”

Sea6 Energy is currently trialing its cultivation technology in partnership with a few fishing communities around the coastal areas of South India. Novozymes’ Indian arm will work closely with Sea6 Energy to develop the conversion technology.

At some point in 2012, the final i’s will be dotted and t’s will be crossed so 15% ethanol can finally become the new consumer choice at the pump.

The final panel of the day at last week’s 6th Annual Iowa Renewable Fuels Summit focused on preparations that are being made to make sure retailers and consumers have all the information they need to make an informed choice when it comes to E15.

“A lot of what consumers know now is wrong,” said Ron Lamberty with the American Coalition for Ethanol (ACE).

Lamberty says while there are consumers who are opposed to the use of ethanol and are unlikely to change their minds, there is a good percentage of people who say they would use E15 if it were available. “When we do get E15 out to the marketplace, one of the things we have to make sure we tell people is that it’s out there and they can use it,” he said, noting that the main thing consumers need to know about E15 is that it is the most tested of fuel in history.

Another point that Lamberty believes is important for consumers to know is that the E15 approval for cars and light trucks newer than 2001 is not a mandate. “Approved for and not required,” Lamberty said. “No stations have to sell it and nobody has to buy it,” he said, although the industry believes that once consumers do try it they will want to use it.

As to when E15 will make it to the market, Lamberty says it is anyone’s guess, but he expects Iowa will be one of the very first places it will be available.

Listen to a Lamberty’s presentation at the summit here: Ron Lamberty at Iowa RFA Summit

Listen to an interview with Lamberty here: Ron Lamberty interview

Greg Emick of W&H Cooperative Oil Company spoke as a retailer that has adopted the use of blender pumps last year so they are already offering E15 as a choice in three different locations, along with other mid-level ethanol blends. “Our E15 sales were somewhat slow to increase but the E30 sales jumped right away,” he said. “I feel with promotion, advertising and pubic awareness about E15, it could become a larger percentage of sales at our retail facilities.”

Emick says their customers appreciate that they are promoting flexible fuels because of their environmental friendliness and competitive pricing, and he sincerely believes in the product and wants to see it continue to grow.

Listen to Greg Emick at the summit here: Greg Emick at Iowa RFA Summit

Photos from 2012 Iowa Renewable Fuels Summit

The battle between Butamax™ and Gevo over isobutanol technology continues.

Last week, Gevo received a landmark patent from the United States Patent and Trademark Office for its GIFT(R) separation unit, a central part of the company’s fermentation technology for the production of isobutanol. The patent, “Recovery of Higher Alcohols From Dilute Aqueous Solutions,” addresses the separation technology used to produce propanols, butanols, pentanols, and hexanols, and also address how ethanol plants can be retrofitted to produce higher alcohols.

At the same time, Gevo also filed a lawsuit against Butamax™ Advanced Biofuels and DuPont charging that those companies infringe the newly issued patent. Gevo contends that Butamax and DuPont “perform the methods described” in the patent without Gevo’s authorization and should pay unspecified damages after a jury trial.

Today Butamax™ officials called the lawsuit allegations “unfounded.”

“Let us state emphatically, Butamax does not infringe the generic product separation technology claims in Gevo’s recent patent, which is already subject to a validity challenge by a Brazilian inventor,” declared Paul Beckwith, Butamax™ CEO. “While it does not surprise us that questions are being raised as to the validity of Gevo’s latest patent and whether Gevo provided sufficient disclosure in their patent application, Butamax does not use this technology.” Butamax has filed a motion to dismiss Gevo’s previous case against Butamax, and also will pursue early resolution of this latest suit.

Butamax officials claim that because vacuum flash fermentation technology was found to require high energy and water consumption to meet commercial productivity, Butamax developed fundamentally different product recovery systems. “The Butamax™ approach combines energy integration, reduced environmental impact and attractive production metrics. Butamax™ technology is covered by the 7,993,889 patent which is the subject of the Butamax™ lawsuit against Gevo for their unlawful infringement. This patent has significant priority over all of Gevo’s patent filings.”

The battle between the two companies goes back over a year ago to when Butamax was first awarded its patent in December 2010 and filed suit for infringement against Gevo in January 2011.

There is a lot made about tensions between the ethanol and livestock industries but the distillers grains co-product of ethanol production is providing significant benefits for animal producers even as ethanol has helped prop up corn prices.

A great discussion at the 6th Annual Iowa Renewable Fuels Summit featured corn and cattle organizations on the same panel talking about the “Synergies of Livestock and Ethanol.”

Moderator Iowa Agriculture Secretary Bill Northey opened the discussion by noting that sales of crops and livestock have risen as ethanol production has increased from $12 billion in 2002 – 6 billion in crop and 6 billion in livestock – to $24 billion in 2010, and 2011 is expected to be about $30 billion with at least $13 billion of that for livestock. “$13 billion on the livestock side versus $6 billion nine years ago,” Northey said. “Has ethanol been good for livestock agriculture in Iowa? I think very clearly.”

Listen to a brief interview with Secretary Northey here: Iowa Agriculture Secretary Bill Northey

Iowa Cattlemen’s Association Executive Director Matt Deppe says it’s easy to see the benefits that distillers grains (DDGS) have brought to especially cattle feeders. “We look at it as a corn replacement,” Deppe says about DDGS. “It means that they (feedlot operators) have another option that’s cost effective to put into their rations.”

Listen to an interview with Matt Deppe here: Matt Deppe Interview

The livestock industry has traditionally been the most important market for corn, noted Iowa Corn Growers CEO Craig Floss, although use for ethanol has increased significantly in the past decade. “But a third of every one of those bushels that goes into an ethanol plant goes into DDGS,” he said.

The panel also included Randy Ives, director of ethanol services for the commodity management firm Gavilon Group.

Listen to or download the entire panel discussion here: Ethanol and Livestock panel

Photos from 2012 Iowa Renewable Fuels Summit

The U.S. Department of Agriculture has approved a conditional commitment of $232.5 million to build a cellulosic ethanol plant in Boardman, Oregon.

The commitment was made to ZeaChem Boardman Biorefinery, LLC (ZBB) through the Biorefinery Assistance Program. ZBB plans to operate a 25 million gallon per year biorefinery to be constructed on an industrial site in northeast Oregon, along the Columbia River.

“In his State of the Union address, President Obama outlined his vision for a new era for American energy—an economy fueled by homegrown and alternative energy sources that will be designed and produced by American workers,” said Agriculture Secretary Tom Vilsack. “This project and others like it will help to establish a domestic advanced biofuels industry that will create jobs here at home and open new markets in the Pacific Northwest and across America.”

The biorefinery will use high-yield cellulosic fermentation technology to produce advanced biofuels. The feedstock will consist of approximately 30 percent agricultural residue, such as wheat straw and corn stover, and 70 percent woody biomass from a local hybrid poplar farm. An existing 250,000-gallon per year cellulosic integrated demonstration plant at the site is currently generating operational data that will provide information needed for the commercial scale project, which will be located on an adjacent site. An estimated 51 percent or more of the biorefinery’s output will be advanced biofuel, and the remainder will be high-value biobased chemicals, such as acetic acid and ethyl acetate.

“This is a very exciting and innovative project and we are very pleased to see ZeaChem moving into the commercial stages of cellulosic ethanol production,” said Brooke Coleman, Executive Director of the Advanced Ethanol Council (AEC). “The advanced and cellulosic ethanol industry is breaking through in a challenging financial climate, which speaks to the evolution of the technology and the value proposition offered by the most innovative liquid fuel and chemical producers in the world.”

For the second year in a row, Iowa high school students have been rewarded for their creative videos promoting renewable fuels.

At the 6th Annual Iowa Renewable Fuels Summit in Des Moines on Tuesday, Ames High School senior Sam Ennis was declared the first place winner of the 2nd Annual “Fuel the Future” video contest for Iowa high school students. For his highly creative, entertaining and informative music video entitled “I Got You Ethanol” Ennis was awarded the $1,000 grand prize by the Iowa Renewable Fuels Association. Ennis is pictured here with Andy Anderson of the law firm Faegre Baker Daniels LLP, which sponsored the contest.

Second place and $600 was awarded to Clay Central Everly Community School tenth grade students Gabby Huss, Rebecca White and Blair Montgomery for their video entry called “Ethanol for the Economy.” Third place and $400 went to eleventh graders Cassandra Davis, Haley Jewell, Lauralin Berkley, Cody Corchado, and Meredith Brister of Pleasant Valley High School in the Quad Cities for “Dear 25 Year Old Me.”

All the videos can be seen on IRFA’s YouTube channel. Watch “I Got You Ethanol” below and listen to the song here: I Got You Ethanol

Photos from 2012 Iowa Renewable Fuels Summit

Reaction to President Obama’s call for an “all-of-the-above energy strategy” in Tuesday’s State of the Union address was met with applause by many renewable energy interests, who at the same time hope his words will be backed with actions.

“We applaud the President’s announcement that he is going to push for homemade, U.S.-energy after 40 years of being addicted to foreign oil,” said Tom Buis, CEO of Growth Energy. “We have to move ahead with American ethanol as part of that solution.”

“The U.S. biodiesel industry is proving that we can accomplish the president’s goals of creating jobs while building a clean-energy economy,” said Anne Steckel with the National Biodiesel Board. “That’s why we’re calling on the Administration to quickly finalize the delayed EPA rule for boosting biodiesel use under the Renewable Fuel Standard in 2013.”

National Corn Growers Association Chairman Bart Schott said they were pleased to hear President Obama’s continued commitment to the nation’s energy independence. “As family corn farmers have risen to the challenge to meet our nation’s energy needs, we are hopeful the direction the President outlined offers similar opportunities for others to expand our energy independence,” he said.

“Working with the President, we can help America become less dependent on foreign oil and a smarter consumer of energy,” Adam Monroe, President of Novozymes North America, said. “Innovations like advanced biofuels can play a major role in the President’s vision but we need steady policies like the Renewable Fuel Standard – and we look forward to working Congress to preserve them.”

The ethanol industry has an unlikely ally in its opposition to the California Low Carbon Fuel Standard that bans the use of corn ethanol in that state. A diverse multi-state coalition that is primarily concerned with the rule’s impact on oil and gas is also opposed.

The Consumer Energy Alliance, a coalition of over 170 energy consumer groups and 300,000 individual members across the United States, is one of the plaintiffs opposing the California LCFS, which was just ruled unconstitutional by a district court judge.

“Not only is an LCFS unconstitutional, but it would also hurt the California economy, farmers, consumers and truckers by raising fuel prices sharply and burdening consumers,” said CEA Executive Vice President Michael Whatley. “And ironically, the policy will have the opposite of its intended effect by creating more greenhouse gases in the long run.”

The CEA’s main concern about the California LCFS is the potential for it to be used to prevent certain sources of petroleum from being converted into fuels such as gasoline, diesel fuel, kerosene and heating oil and that it could adopted nationwide, resulting in lost jobs and declining household revenue.

After the district court judge this week rejected a motion by the state to continue implementing the LCFS despite his ruling that it was unconstitutional, the California Air Resources Board (CARB) decided to appeal to a new court in the 9th Circuit in hopes of a different outcome.

“The decision by CARB to appeal the decision by the District Court is disappointing, but unfortunately not surprising. We look forward to a decision by the Ninth Circuit upholding the District Court and confirming the unconstitutional nature of California’s low carbon fuel standard,” said Whatley, urging CARB to “scrap this faulty program” instead of appealing the decision.