Ethanol: The Hot Rod Fuel of the Future

Gale Banks with Gale Banks EngineeringNearly 50 years in the business of engine performance should be enough experience to earn one the title of “Auto Performance Expert.” Gale Banks with Gale Banks Engineering started his business in 1958. His business, which consists of designing engines for various factories, manufacturing his own line of engines and developing after market performance products, is just a year shy of that half-century milestone; and that experience was expertise enough to earn him a spot on a video segment with Jay Leno. When Chuck dropped by Jay’s garage last month, he spoke with Gale just before the taping about ethanol, the E85 ethanol fuel blend and what the food stock-based fuel means for performance:

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VeraSun Production Feeds EPIC Promotion

EPIC Marketing Director Melissa UllerichVeraSun Energy, one of the country’s largest producers of ethanol, aims to expand its business as consumers become more educated about the fuel. Marketing Director Melissa Ullerich said VeraSun Energy supplies E85 fuel to more than 90 locations. Melissa said with plants in Aurora, SD, Fort Dodge, IA and Charles City, IA the company produces about 340 million gallons of ethanol. She adds that the company has three more plants under development in Welcome, MN, Heartly IA and Reynolds, IN – or, she said, otherwise known as BioTown.

Chuck caught up with Melissa at the 91st Indianapolis 500. She was attending “The Greatest Spectacle in Racing” as a board member of the Ethanol Promotion and Information Council. She tells Chuck why EPIC is important to VeraSun Energy:

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Food Price Inflation

JohannsEthanol continues to get more than its fair share of blame for higher food prices, but Agriculture Secretary Mike Johanns urges people to look at the whole picture.

Speaking to farm broadcasters in Washington D.C. recently, Johanns said that he hates to pick out one item in the food chain and start blaming it for rising costs. “Look at how much diesel fuel has gone up recently,” he said. “What’s a significant piece of the food chain? It’s moving that commodity from farm to table.”

The latest forecast for food price increases this year is between three and four percent. Beef and poultry are up already over 4.5% from last year. But the largest increases are in fresh fruits and vegetables, which are up six to eight percent over 2006. According to USDA economist Ephraim Leibtag, “Part of this is due to weather damage, but also we just have seen higher production costs overall and higher costs of transportation coming into the system more fully.”

So, when it comes to reports that increased ethanol production is the cause of increased food prices, Johanns said, “Again, I would just urge people to be very cautious about this story. It tends to be an interesting story but it may not have the significance that one would argue. We need to tell the whole story.”

Listen to Johanns’ comments here: 1:20 mp3

SW Missouri Biofuel Hub

It looks like a 50-million-gallon-a-year ethanol plant is in the works at a site near Nevada, Missouri… just up the road from $90 million plant that will make soy-based biodiesel.

Officials with Ozark Ethanol LLC recently met with the Vernon County Commission and citizens to discuss the plant. According to this AP story in the Springfield News-Leader, not much officially is being said about the plant except a general location of where it will be built in Southwest Missouri:

But Vernon County Presiding Commissioner Bonnie McCord said the location being discussed is near the intersection of Missouri 43 and U.S. 54, which is just down the road from the soybean-diesel plant now being built by a company called Prairie Pride.

For both companies, location is part of the attraction.

MCGAVernon County lies in west-central Missouri on the Kansas border, with roads and rail lines that would easily connect the plants with farmers in both states supplying the corn and soybeans.
But it’s not just location, location, location that’s driving the two plants:

Gary Marshall, chief executive officer with the Missouri Corn Growers Association, said four ethanol plants are operating in Missouri right now, and five are under construction.

“The demand is very, very strong and continues to be very strong,” he said of ethanol.

Plant Materials Key to Bioenergy

NRCSUSDA’s Natural Resources Conservation Service is on the forefront of developing plants that could be used as future energy sources through the NRCS Plant Materials Program. National Program leader for Plant Materials Bob Escheman says that is part of their mission to solve resource concerns.

Bob Escheman“The Plant Material program began back in the middle ‘30s when the Soil Conservation Service was established,” Escheman said. “We are now getting into bioenergy where we are working with universities and other producers.”

One of the plants they are working on developing for energy is switchgrass, which became famous when President Bush mentioned it last year in his State of the Union address.

“We’ve been growing switchgrass since the 1950s and we are trying to find where we can best grow the plant for bioenergy uses,” said Escheman.

One of the main problems of using switchgrass as a biofuel has been the amount of ash which is created after burning it. To solve this problem, the Plant Materials Centers (PMC) at Knox City, Texas and Elsberry, Missouri, along with the USDA Agricultural Research Service and Mississippi State University are cooperating on a study to investigate how the timing of harvesting affects biomass yield and the biofuel-quality of switchgrass.

Niles GlasgowThere are 27 regional NRCS Plant Materials centers nationwide, including one in Brooksville, Florida. State Conservationist Niles Glasgow, who is also chairman of the National Plant Materials Advisory Committee, says bioenergy research is an exciting area for the program.

“One of the big things we have to start looking at is what kind of plants are going to produce the most amount of mass that can be turned into fuel,” said Glasgow.

He notes that Florida Agriculture Commissioner Charles Bronson is very interested in making the Sunshine State a major player in alternative fuels. “And we know that will not be from growing corn, it will be from growing grass” or different types of sugarcane.

Both Escheman and Glasgow believe that the role of the Plant Materials Program in developing sources for alternative fuels is just beginning.

Ethanol Expansion and Education

Amy KOne former and two current Democratic presidential candidates are sponsors or co-sponsors of a bill introduced by Senator Amy Klobuchar (D-MN) intended to expand consumer access to 85 percent ethanol fuel, or E-85. Primary sponsors of the bill with Klobuchar include Barack Obama, (D-IL), Kit Bond (R-MO), George Voinovich (R-OH), and Dick Durbin (D-IL). Senators Ben Nelson (D-NE), Debbie Stabenow (D-MI), Sherrod Brown (D-OH), Hilary Clinton (D-NY), Claire McCaskill (D-MO), and John Kerry (D-MA) are also co-sponsors of the legislation.

According to a release from Klobuchar’s office, the Ethanol Education and Expansion Act of 2007 would work to reduce prices at the pump for consumers by providing grants through the U.S. Department of Agriculture (USDA) to farmer-owned ethanol producers to install additional E-85 pumps at rural gas stations as well as the equipment needed to sell E-85 directly to gas stations.

Sen. Klobuchar will work to include the legislation in the 2007 Farm Bill, which the Senate is expected to take up in the coming months.

US BioEnergy Makes New Move Into Millennium

US BioenergyUS BioEnergy Corporation, one of the largest producers of ethanol in the United States, just got bigger.

MillenniumThe company has agreed to acquire Millennium Ethanol, which is constructing a 100 million gallon ethanol plant near Marion, South Dakota, expected to begin production in the first quarter of 2008. With this acquisition, US BioEnergy will have 8 plants in 6 states with expected total production of 700 mgy by the end of 2008.

Gordon Ommen, CEO of US BioEnergy Corporation says they are excited about having Millennium’s approximately 900 shareholders, many of whom are farmers, become shareholders of US Bio. “This fits well with our existing shareholder base, including CHS and their 325,000 farmer owners.”

Energy Crop Incentive Bill

John ThuneSen. John Thune (R-SD) has introduced legislation aimed at helping farmers near biorefineries begin growing dedicated energy crops.

According to Thune, the Biofuels Innovation Program Act would offer farmers incentives to grow crops, such as switchgrass and fast-growing trees, for use as cellulosic ethanol feedstocks.

“Cellulosic ethanol, produced from homegrown sources like corn stover, wheat straw, switchgrass and wood chips, has incredible potential to supplement corn-based ethanol. But if cellulosic ethanol is to achieve its potential, it is critical that Congress help this industry overcome initial market barriers” said Thune. “My legislation would spur the construction of biorefineries across the country and provide incentives to farmers in surrounding areas to grow energy dedicated crops that can eventually supply these biorefineries in a cost-effective, environment-friendly way.”

Thune hopes the legislation, which is co-sponsored by Sen. Ben Nelson (D-NE), will be included in the 2007 Farm Bill energy title. Similar legislation has also been introduced in the House.

The bill would fund several USDA feasibility studies to determine the level of interest and likelihood of success for biorefinery constructions. The bill would authorize a cost share and per-acre rental payment for farmers during a contract’s first five years, in order to help the biorefinery get established and build a market. In addition, farmers selling byproducts and residues, such as wheat straw and corn stover, to ethanol plants would be eligible for matching payments of up to $45 per ton.

2007 Farm to Fuel Summit

Farm to Fuel Florida Agriculture and Consumer Services Commissioner Charles Bronson has scheduled the second annual “Farm to Fuel” summit July 18-20 at the Marriott Renaissance Vinoy Resort in St. Petersburg.

Hoping to build on recent developments in Florida’s efforts to establish a renewable energy industry, Bronson said the meeting will cover current initiatives relating to ethanol and bio-diesel, as well as other opportunities for renewable energy production in Florida.

“There has been a good deal of momentum recently in our drive to get this industry off the ground,” Bronson said. “We’re eager to share that with participants and provide them with the information they need to enter this industry.”

Last August in Orlando, Bronson hosted the first ever Florida “Farm to Fuel” summit, which attracted more than 300 participants, and the Commissioner believes that this year’s conference will be bigger and better.

Letter from Ethanol Crusader

I received this letter yesterday from a self-proclaimed “ethanol crusader” in Florida. It was pretty long, but here is an edited version with her key points:

Hi Cindy, keep up the good work.

I’ve recently join the Movement “Florida Needs Ethanol”.com.

Florida Needs EthanolToday (Memorial Day) I drove around to distribute fliers to several gas stations. Mostly the small ones like Race Track, Red Rabbit, Valero, Marathon, 7/11 Citgo and some BPs.

It was amazing and somewhat disconcerting how little they know about Ethanol. Out of the dozens station attendants I’ve talked to, only one had heard of Ethanol.

The only way I got them interested was telling them that the government was offering tax incentives to fuel retailers. I told them to visit the website to find out about it, but I can’t find the link for retailers info. Could you please make that link more obvious?

Also, I was very disappointed by the great opportunity lost by Ethanol producers, GM and Ford by not advertising their products during the Super Bowl of racing (the Indy 500).

Why didn’t they run it during this classic race making history about the three women and all the cars running on Ethanol?

Don Endres’ VeraSun has a video commercial on their website that bring tears to one’s eyes with an once of patriotism. If the Ethanol Big Guys don’t care that much to promote their product on TV during IRL races, why should I spend my gasoline money and my time to promote it?

This thing about the EPA not approving a retro-fit kit to transition to E-85 is VERY disheartening. Unfortunately, most of us that want to do the right thing cannot afford to buy a new car, let alone a hybrid or FFV.

In parting, I’d like to ask you to please forward my email to anybody and everybody involved in bringing Ethanol to the public, especially here in Florida. My friends and co-workers are eager to help save our beautiful planet.

Best Regards,
Lynda Gagnon
Ethanol Crusader

First of all, Lynda – thanks for the grassroots work you are doing to help bring ethanol to the Sunshine State. You are doing more with your campaign than you might believe. If retailers think people will buy a new product, they are more likely to begin offering it.

Secondly, the Ethanol Promotion and Information Council was a major sponsor of the Indy 500, which featured spots that aired multiple times during the race. To view the ethanol spots, go to this page on the EPIC website. The television spots have run during all of the races so far this year, starting with Homestead in Florida.

EPIC also sponsored a major public and media event at the Indy 500 called the Ethanol Summit to educate people about ethanol’s benefits as a performance fuel. They have gotten major publicity from events held earlier this month at the National Press Club and Chicago Board of Trade.

Finally, you make a good point about the need for more information for retailers about incentives to offer ethanol-enhanced fuel and I have passed that along to EPIC. A good place for that information right now is the National Ethanol Vehicle Coalition site, which has a page devoted to retailer information.

Thanks again, Ethanol Crusader. Just curious, do you have some kind of cool super hero costume to wear when you are out crusading??

New MO Ethanol Plant Plans

MCGAThe Missouri Corn Growers Association reports that a new ethanol plant is in the works for northeast Missouri.

Mississippi Valley BioEnergy, LLC (MVBE) announced that it plans to build a 100 million gallon per year dry mill production facility near West Quincy. MVBE recently signed a letter of intent with ICM, Inc. to provide services related to the design, construction and start-up of the proposed facility. The company has also retained BBI International as its consultant to assist with project formation and development.

Brent Rockhold, chairman of MVBE and former board member with Missouri Corn, believes the company is poised to make a positive impact on Missouri’s ethanol industry and economy of the tri-state region. “Our management and advisory committees reflect some of the most well-known, respected leaders in Missouri who bring diverse backgrounds and broad expertise,” he said.

Dario Franchitti & Ethanol Win Indy 500

Dario FranchittiHere’s today’s winner of the Indy 500, Dario Franchitti at the post-race press conference. He seemed like the most amazed guy in the world for having run and we certainly congratulate him.

During the press conference I asked him how he felt about winning by burning a renewable fuel in his car and how it performed. He has no problem with ethanol. In fact, he said it helped him get better gas mileage and that was beneficial in the end.

Listen to Dario talk about ethanol here:

2007 Indy 500 Photo Album

Don’t forget to check out my online photo album which Laura McNamara and I have contributed to during this past week and have a great holiday.

A Soggy Finish To Indy

Jeff SimmonsThis race today will go down as a strange one with all the cars running into the wall and the rain delay and then rain ending it early.

You can see from Jeff Simmon’s car here that it just poured down at the end. This is on the last lap before they came into the pits and called it over.

Jeff came in 11th but sure ran a strong race today. I think this was about the best I’ve seen his car performing and it’s too bad that the rain had to mess things up. But in the end ethanol wins again.

2007 Indy 500 Photo Album

The Race Is Back On

Jeff SimmonsThe race is back on after a lengthy delay due to rain.

Jeff Simmons in the ethanol car has been running very strong today. It looks like the race will be won on strategy and pit stop timing since the cars are pretty much out of sync with their normal plan.

I’ll try to be in victory lane and the winner’s press conference after the race and will bring you the finale as we see ethanol win no matter which car comes across the finish line first.

2007 Indy 500 Photo Album