Domestic Fuel

A recently exhausted rebate program in California is being credited with helping the state really increase its use of alternative fuels in vehicles.

From its inception in February 2008 to its end this past April, the Fueling Alternatives program handed out $2.6 million to encourage consumers to buy alternative fuel vehicles. And this article from the San Diego (CA) Daily Transcript says 948 rebates for as much as $5,000 were handed out to state residents who bought low- or zero-emission vehicles:

The program was funded by the California Air Resources Board with a portion of Assembly Bill 1811, which dedicated $25 million to promote alternative fuel infrastructure and vehicles. San Diego-based nonprofit, California Center for Sustainable Energies administered the program, which helped offset the cost of purchasing or leasing electric, compressed natural gas and fuel cell technologies.

Purchases of the Global Electric Motorcars’ line of neighborhood electric vehicles were awarded the second-largest number of rebates at 116. Other popular vehicles included the Vectrix electric scooter and the high-performance electric Tesla Roadster. Six owners of the hydrogen-powered fuel cell car, Honda FCX also received rebates.

If lawmakers in California approve more funds, there could be about $5 million available for low-emission cars and motorcycles.

A YouTube video of EPA official Margo Oge testifying before a House panel in May reveals her providing radically incorrect information about the amount of corn and soybeans it takes to make biofuels.

The blunder occurred when Rep. Aaron Schock (R-IL) asked Ms. Oge, who is responsible for regulating all emissions within the United States, about the indirect land use issue. “It’s my understanding that the EPA’s Renewable Fuels Standard 2 methodology assumes that for every acre of soybean crop that is used to produce biofuel, an equal acre of ground is used in the Brazilian rainforest to replace that acreage, is that correct?” asked Schock.

“Obviously we know that it takes about 64 acres for a gallon of soy biodiesel,” she begins, and then corrects herself, even more incorrectly. “It’s actually the opposite. It takes 64 acres for corn ethanol and over 400 acres for a gallon of biodiesel.”

Actually, one acre of soybeans makes 64 gallons of biodiesel and one acre of corn makes over 400 gallons of ethanol. This may have been just a simple mistake - or maybe she really doesn’t know - but it is now possible that members of the U.S. House Small Business Committee believe that it takes a huge amount of corn and soybeans to produce biofuels because that is what she told them.

The YouTube video with commentary was posted anonymously by an account called “FreedomIs1st” and no one in the biofuels industry has taken credit for it - but it is very good and should be shared. In fact, it might be good for people in the industry to write to their congressional representatives, especially if they are on the House Small Business committee, to make sure they have the facts.

The Obama administration embarked on a National Rural Tour this week that will include discussions about green jobs, a new energy economy, climate change and renewable energies.

During an interview for the National Association of Farm Broadcasting with Michelle Rook of WNAX, Yankton, SD, Obama was asked about the role renewable fuels will play in the future for rural America. “Obviously, I come from a farm state - Illinois - and ethanol has been a big boon for a lot of rural communities,” the president said. “But we also are recognizing the key for us is to move into the next generation of biofuels, how can we use wood chips and refuse and switchgrass and how can we improve the efficiency of first generation biofuels. Farmers are going to be critical to that entire process.”

“We want to be able to compete with countries like Brazil that now are running basically their entire automobile fleet on biofuels,” he continued. “If Brazil can do it, there’s no reason why America can’t do it.”

Obama also commented on the climate change bill passed by the U.S. House of Representatives last week, saying that the legislation provides “a whole host of opportunities for rural communities to profit even as they are helping to achieve America’s energy independence.”

The first stop on the administration’s rural road trip was in Wattsburg, Pennsylvania on Wednesday where the topic was rural broadband service. Future dates where energy will be the focus include July 18 in Ringgold, Virginia; August 12 in Bethel, Arkansas; and August 16 in Zanesville, Ohio.

Listen to Obama’s ethanol and climate bill comments here:

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The newest member of the U.S. Senate says he is pro-ethanol. In an interview with MinnPost.com today, Senator-elect Al Franken (D-MN) expressed his support for ethanol.

“What we’re talking about here is the science of how ethanol affects our carbon footprint,” Franken said. “The science to me tells me it helps. I’ve looked at this a lot, and it seems to me that ethanol already helps our carbon footprint and it’s only getting more efficient in the way it’s produced. Corn ethanol is a step on the way to cellulosic ethanol, which is also going to benefit Minnesota. I’m in the pro-ethanol camp.”

Franken’s campaign website gives his views on renewable energy and the need for America to reduce its dependence on foreign oil.

I think we need a new “Apollo project” – this time to fundamentally change our energy policy and end our reliance on foreign oil.

This “Apollo project” should provide financial support for research into new forms of renewable energy and development of currently-identified sources to make them more efficient. Of course I’m talking about corn ethanol. But I’m also talking about cellulosic ethanol and other biofuels. I’m talking about solar power. And, especially here in Minnesota, I’m talking about wind power. We live in a windy state!

The Environmental Protection Agency plans to extend the public comment period for the proposed rule on the Renewable Fuel Standard for an additional 60 days until September 25, 2009. A public notice dated Tuesday was posted on scribd.com and may be published in the Federal Register this week. However, no notice has yet been posted on the EPA website and the agency has not sent out a news release about the action.

Senator Chuck Grassley (R-IA) expressed concerns about the extension during his weekly telephone press conference with agricultural reporters. “There’s no doubt that the issue that EPA is dealing with is very complex, so I suppose we ought to have some appreciation for the extra time they’re taking,” Grassley said. “However, the delays threaten the viability of the biodiesel industry which needs the rule to set the level that must be used in 2010 for the RFS. It’s important that the rule gets finished to provide market certainty because biodiesel is not very good shape.”

The National Biodiesel Board (NBB) also expressed concern about the extension, which will mean a delay in implementation of the rule. In a statement, NBB officials said, “It is important to note that RFS-2 was supposed to be in place at the beginning of this year, and extension of the comment period could further delay the implementation of the program, This will provide additional hardship to the U.S. biodiesel industry.”

The ethanol industry has not yet released any official comment on the notice of extension.

A couple of issues might be coming to a head with one bill. As I told you back on May 22, biodiesel producers are none too pleased about an EPA proposal that would, in effect, exempt soy-based biodiesel from the Renewable Fuels Standard (RFS)… putting biodiesel in danger of not being able to meet that standard, possibly undermining confidence in the green fuel.

But, as Biodiesel Magazine reports, with the passage of the American Clean Energy and Security Act of 2009… aka the Climate Bill… in the U.S. House, soy-based biodiesel might be back in:

Among the provisions of a deal struck among the House leadership, biodiesel gets grandfathered in to the1 billion carve-out for biomass-based diesel without a greenhouse gas (GHG) reduction target, similar to the grandfather provision for ethanol. Biodiesel production from all plants in production or under construction in December, 2007, when the 2007 Energy Bill was enacted, is grandfathered into the RFS at 1 billion gallons or the EPA-set volume, whichever is higher.

The bill’s language also delays the use of international indirect land use change impacts in determining a fuel’s GHG emission profile for the RFS for several years while an independent scientific assessment is done. Six months after enactment, the bill says the USDA and EPA would jointly institute a three-year National Academy of Sciences study to determine whether or not it is scientifically valid to incorporate indirect international emissions. Upon completion, the Secretary of Agriculture and the EPA administrator would jointly determine whether to include indirect emissions in the GHG reduction targets for the RFS program, subject to public notice and comment. Congress would have one year to act on the joint USDA/EPA determination. The earliest an international indirect land use assessment for GHG emissions could be incorporated would be six years from enactment.

Now we’ll have to keep an eye on what happens in the Senate.

For the first time, the federal government has issued offshore wind leases to explore the potential of the energy source.

The New York Times reports the five leases will be for areas 6 to 18 miles off the New Jersey and Delaware coasts:

Interior Secretary Ken Salazar, who has made offshore wind energy a priority, acknowledged that the United States was playing catch-up to European countries, like Denmark or the Netherlands, which have long focused on alternative energy.

The leases were granted to Bluewater Wind New Jersey Energy; Fishermen’s Energy of New Jersey; Deepwater Wind, and Bluewater Wind Delaware.

Some estimates say that the wind could provide 20 percent of the country’s energy needs by 2030, and offshore wind power generation could play a significant role in that number.

The Renewable Fuels Association (RFA) has provided more details about the compromise worked out this week on the climate change bill expected to come up for a vote in the House of Representatives on Friday.

“Good faith negotiations and old fashioned horse sense led to a deal that achieves both our energy security and environmental goals,” said RFA President Bob Dinneen. “By ordering further review of the controversial theory of international indirect land use change, Congress can allow science to catch up with policy goals.”

According to RFA, the compromise contains the following provisions:

The definition of renewable biomass was harmonized with the 2008 Farm Bill language for private lands. Environmental safeguards for public lands were preserved.

Biodiesel facilities built before implementation of the 2007 energy bill while be grandfathered into the law in the same fashion as ethanol facilities of the same vintage.

Dinneen says House Ag Committee Chairman Collin Peterson and House Energy and Commerce Committee Chairman Henry Waxman and their staffs deserve a great deal of credit for getting this bill to a vote. “While just the first step in a long process, the House should move quickly to pass this legislation,” he said.

Farm state lawmakers led by Rep. Collin Peterson (D-MN) have reached a compromise with Democratic leadership in the House on the so-called climate change bill that makes it more palatable to agriculture and biofuels interests.

Part of the agreement includes allowing USDA to have oversight for agricultural carbon offset programs instead of EPA. “The climate change bill will include a strong agriculture offset program run by the U.S. Department of Agriculture that will allow farmers, ranchers, and forestland owners to participate fully in a market-based carbon offset program,” said Peterson. “This agreement also addresses concerns about international indirect land use provisions that unfairly restricted U.S. biofuels producers and exempts agriculture and forestry from the definition of a capped sector.”

The compromise over indirect land use issue was that bill sponsor Henry Waxman (D-CA) will ask the EPA to commission a study of indirect costs and that any method of counting those costs should be agreed to by both USDA and EPA.

Tom Buis, CEO of Growth Energy, was pleased that Peterson and Waxman were able to reach a compromise on the issue. “We believe that additional study of the issue of indirect land use change will further demonstrate that these provisions should never have been a part of the 2007 energy law to begin with,” Buis said in a statement. “This is a good first step in a longer process, including full review by the House and Senate.”

The American Clean Energy and Security Act is expected to come up for a vote on Friday and President Obama encouraged passage during his press conference yesterday. “It is legislation that will finally spark a clean energy transformation that will reduce our dependence on foreign oil and confront the carbon pollution that threatens our planet,” Obama said.

During a visit to Des Moines Monday, Secretary of Energy Steven Chu gave some hope to ethanol supporters hoping that the federal government will approve a waiver that would allow up to 15 percent ethanol blends for standard vehicles.

“I don’t want to prejudge what they’re going to find, but if the existing automobile fleet can handle 15 percent, I would say let’s make that a target and go to 15 percent,” Chu said. “This is very important for decreasing our oil independence.”

Chu was in Des Moines Monday to announce more than $16 million in American Recovery and Reinvestment Act funding for energy efficiency and renewable energy projects in Iowa during a news conference with Governor Chet Culver.

“Energy independence is more than simply an Iowa initiative, it’s something of national importance,” said Culver. “We are well on our way to making Iowa the renewable energy capitol of the United States and the Silicon Valley of the Midwest.”

Secretary Chu also suggested that car manufacturers ought to make all new automobiles able to run on E85 ethanol-blended fuel. “I’ve been told it costs about $100 in gaskets and fuel lines to turn a car so that it can go all the way to E85,” Chu said. “But a new car , it would only cost $100 out of $15,000. Wouldn’t it be nice to put in those fuel lines and gaskets so that we can use any ratio we wanted. It’s just a thought, I don’t think you’re going to get any objections in this audience.” He said that requiring companies to make all vehicles flex-fuel is “beginning to be discussed” but first “we’ll see about whether the current fleet can take 15 percent or 13 percent ethanol.”

Chu spoke optimistically about making cellulosic ethanol commercially viable in the near future and said the agency is doing all it can to make that happen. “Department of Energy is funding three biofuels research institutes,” he said. Once it becomes a reality, Chu says agriculture could provide about half the transportation fuel needed for the nation. “The United States has incredible potential so we want to push this as hard as possible.”

However, Chu avoided direct comment about how EPA may choose to determine indirect land use changes that could be detrimental to biofuels when asked by a reporter about concerns that it could impact the future of corn ethanol. “It’s out for peer review and we’ll see how it plays out,” he said.

Listen to audio of Chu’s answers to some of the questions posed.

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