Getting More Washington Perspective

Tom DorrOur Undersecretary for Rural Development, Tom Dorr, was first up on the program here this morning at the National Ethanol Conference to speak about the farm bill and focus on renewable fuel policies and provisions.

He says the ethanol industry is going through some growing pains, or put another way, transitional challenges. He’s convinced these will be overcome. Like many of the speakers here he talked about the attacks on ethanol, especially of late, in terms of sustainability. He said that some of the same regulatory rhetoric being discussed in Europe in regards to biofuels is creeping up in the debate in Washington, DC. He pointed out that farmers have long been working on sustainability and the facts show that they’re increasing yields while reducing inputs.

You can hear most of Dorr’s speech here (I missed the very beginning):

National Ethanol Conference Photo Album

Andy Karsner Speech

Andy KarsnerBob Dinneen, RFA President, isn’t the only one to preach a powerful sermon here at the National Ethanol Conference. I was very surprised and pleased to hear Andy Karsner, Assistant Secretary for Energy Efficiency & Renewable Energy, U.S. Department of Energy, speak at today’s luncheon. He gave a very passionate speech that you would really enjoy listening to. That’s why I decided to post a link to the full speech below for you. I know it’s a little long but you can listen to as little or as much as you’d like this way.

I think he went to great lengths to talk about the mis-information filtering out to the public about renewable fuel sources. In fact, as so many of you know, it’s hard to believe how much of it is out there. So he addressed those problems head on with good scientific information.

He tells a very moving story about how much he travels for his present position and how that has affected his family and young children. He says that even though it’s difficult, it’s minor compared to what our military men and women are doing to fight the war on terror overseas. He says it’s the least we can do to do our part here at home which includes developing sources of energy that make us more independent of those countries that would do us harm.

Another message that came through loud and clear was his idea that the solutions to our energy needs are something that will be done by not just the government but by private industry and government working together.

You can listen to Andy Karsner’s speech here:

National Ethanol Conference Photo Album

NFU Gets Behind Renewable Energy Bill

nfu.pngThe National Farmers Union is pledging its support to an energy bill seen as friendly to biofuels, while praising Democrat leaders who back the bill.

This story on CattleNetwork.com says National Farmers Union President Tom Buis lauded Speaker of the House Nancy Pelosi and Ways and Means Committee Chairman Charlie Rangel for backing the bill designed to spark wind and biomass energy that will bring billions of dollars to rural areas. And the NFU is urging Congress to pass the legislation:

In a letter to Pelosi and Rangel, Buis stated NFU’s strong support for the Renewable Energy and Energy Conservation Tax Act of 2008.

buis.jpg“Not only does fostering renewable energy provide the opportunity for energy independence, it also provides a source for rural economic development that will significantly jump-start rural economies,” Buis said. “Two provisions of this bill, extending the Production Tax Credit and authorizing funds for the Clean Renewable Energy Bonds, are essential.”

The legislation would extend the Production Tax Credit (PTC) for three years. “The PTC provides the most critical federal incentive to continue developing wind projects in rural communities,” Buis said.

The NFU has been a longtime backer of ethanol, biodiesel, and other ag-based fuels.

International Cleantech Forum

Cleantech Group LLCSan Francisco will play host to more than 800 investors, entrepreneurs and leading renewable energy experts at the international Cleantech Forum XVI convening next week. This year’s forum is highlighting 2008 as ‘The Defining Year for Cleantech Globalization.’

Investors, entrepreneurs, industry influencers and corporate leaders at the forefront of the rapidly developing cleantech investment and business category from North American, Europe, the Gulf States and Asia will convene in San Francisco for Cleantech Forum(R) XVI, to be held at the San Francisco Fairmont Hotel from February 25-27, 2008.

Cleantech Forum XVI is hosted by the Cleantech Group, LLC, founders of the cleantech investment category. The annual flagship meeting of the world’s cleantech leaders, representing over $8 trillion in assets, will define investment trends for 2008 and focus capital on the emerging opportunities and solutions to natural resource constraints and global climate change issues.

Dr. Sultan Ahmed al Jaber, CEO of the Masdar Initiative and Abu Dhabi Future Energy Company, will deliver the keynote address at the Cleantech Forum XVI Gala Dinner on Tuesday February 26. With a $15 billion commitment announced in January, Dr. Sultan al Jaber is leading the largest government-supported cleantech initiative in the world.

U.S. Department of Energy Assistant Secretary for Energy Efficiency and Renewable Energy Andy Karsner will highlight the Department’s transformational public-private sector work intended to accelerate the development, deployment and commercialization of cutting-edge, clean energy technologies from the Agency’s national laboratories into the global marketplace. Continue reading

AZ Bill Would Help Pay for Adding Biofuels

boone.gifA bill introduced in the Arizona legislature would help pay the costs of gas stations adding biofuels to their lineups.

The Tucson Citizen reports HB 2620, offered by Arizona House majority leader Tom Boone (R-Peoria), will help stations meet the growing numbers of vehicles that can run the green fuels:

“We need to make sure Arizonans have cleaner fuel choices available to them,” Boone said.
He added that because of the state budget crunch, the bill would not allocate any funds toward the program, but it would “create a conduit through which to distribute and gather monies for the program.”

There are 7,127,966 vehicles on the roads in Arizona, said Cydney DeModica, spokesperson for the Arizona Department of Transportation. Bill Schaeffer, executive director of the Valley of the Sun Clean Cities Coalition, said of these vehicles, an estimated 150,000 are capable of running on E-85 and 230,855 could run on biodiesel.

There are 13 E-85 stations and nine biodiesel stations in Arizona.

The money to pay for the conversions would come from gifts, grants, donations or other state, federal or private sources and go into a central fund. The conversion costs, particularly to hold E85, are expected to be between $50,000 and $100,000. If a station already carries diesel, there’s no conversion to carry biodiesel.

Secretary of Agriculture Biofuels Message To Livestock Producers

Me and Sec. EdOur Secretary of Agriculture, Ed Schafer, made his first major public policy speech today at the Cattle Industry Convention in Reno, NV. I had the pleasure of meeting him and talked someone into snapping a photo too. I thought you might be interested in hearing an audio clip from his speech here this morning since he hit the subject of high feed prices and renewable energy head on.

Basically, he said that with the growth of cellulosic ethanol production there should be an easing of feed price pressure within a short time as the technology and non-food stocks form of ethanol production continues to rapidly develop.

Sec. SchaferHe says there’s no way we can get away from the reality of the need to become more energy independent here in America.

He does admit that there will be higher feed prices in the short term but he stressed that the President’s energy bill provides an outline toward the future which is cellulosic.

You can listen to Secretary Schafer’s comments here:

RFA to Testify on Energy Act

RFAThe president of the Renewable Fuels Association (RFA) will present testimony Thursday to the Senate Energy and Natural Resource Committee at a hearing on the Energy Independence and Security Act of 2007.

Dinneen’s intends to tell the committee that the American ethanol industry stands ready to do its part to make the law successful.

Putting the importance of developing a renewable fuels industry in the context of reducing greenhouse gas emissions, Dinneen will note, “An analysis conducted for the RFA using the U.S. Department of Energy’s existing GREET model shows that increasing the use of ethanol and other renewable fuels to 36 billion gallons annually by 2022 could reduce greenhouse gas emissions by some 176 million metric tons, equal to removing the annual emissions of more than 27 million cars from the road.”

Moreover, given the downturn America’s economy is experiencing, Dinneen will underscore the important economic engine renewable fuel production can be for the nation. Economic analysis of the impact of increased domestic biofuel production and use as a result of the EISA anticipate the creation of more than 1 million new jobs, the addition of $1.7 trillion to the gross domestic product, and an increase in household incomes of more than $400 million.

No Budget Change in Ethanol Tariff

Bush BudgetReports of the demise of the ethanol tariff in the new White House budget were apparently greatly exaggerated.

Despite hints from Energy Secretary Sam Bodman last week that changes might be made to the expiring U.S. ethanol import tariff in its new 2009 government budget that was sent to Congress on Monday, no such changes were included.

Reuters reports that an energy department spokesperson said while the 54-cent-a-gallon tariff is set to expire at the end of December during the 2009 budget year, which begins this October 1, the administration will have discussions with lawmakers later this year on what should be done with the tariff.

The tariff is designed to protect the U.S. ethanol industry from other countries taking advantage of the 51 cent per gallon blenders’ tax credit.

White House Budget May Change Ethanol Tariff

Sam BodmanIndications are that the Bush administration will make changes to the ethanol tariff in its budget to Congress scheduled to be released Monday. Earlier this week, Energy Secretary Sam Bodman hinted that the White House’s 2009 budget may propose scaling back or eliminating the 54-cent-a-gallon import tariff.

In a speech to the U.S. Chamber of Commerce, Bodman said, “I would just say I think that there are advantages to having had the kind of both subsidies and tariffs that have helped protect this industry. I believe that, the best I can tell, this industry is pretty close to being able to stand on its own.”

Chuck GrassleySenator Chuck Grassley (R-IA) issued a statement.saying that removing the tariff would ultimately result in subsidizing Brazilian ethanol. “I can’t figure out why Secretary Bodman would want the United States to risk becoming dependent on Brazilian ethanol when we’re already dependent on Middle East oil. His comments really do a disservice to President Bush who has been the most pro-ethanol president we’ve ever had,” Grassley said.

“In addition, the United States already provides duty-free treatment for Brazilian ethanol that is merely dehydrated in the Caribbean Basin Initiative countries. Brazil has yet to make full use of this program. I don’t see why we should bend over backwards to provide yet more duty-free treatment for Brazil’s ethanol producers.”

Energy Secretary Awards Cellulosic Grants

DOEU.S. Department of Energy Secretary Samuel W. Bodman today announced that DOE will invest up to $114 million over four years for four small-scale biorefinery projects to be located in Commerce City, Colorado; St. Joseph, Missouri; Boardman, Oregon; and Wisconsin Rapids, Wisconsin.

“These project proposals were innovative and represent the geographic diversity that we strive for when making the widespread use of clean, renewable fuels commercially viable,” Secretary Bodman said. “Spurred by the President’s ambitious plan to reduce projected U.S. gas consumption by twenty percent by 2017, our goal is to aggressively push these technologies forward to get them out into the marketplace as quickly as possible, so they can have a real impact. Advanced biofuels offer tremendous promise for helping our nation to bring about a new, cleaner, more secure and affordable energy future.”

Building on President Bush’s goal of making cellulosic ethanol cost-competitive by 2012, these commercial-scale biorefineries will use a wide variety of feedstocks and test novel conversion technologies to provide data necessary to bring online full-size, commercial-scale biorefineries.

The companies receiving the grants are ICM Incorporated of Colwich, Kansas; Lignol Innovations Inc., of Berwyn, Pennsylvania; and Pacific Ethanol Inc., of Sacramento, California.

Illinois to Consider Ethanol Blends

Illinois SchockLegislation is being proposed in Illinois for ethanol blends between 10 and 85 percent.

According to the Peoria Journal Star, State Rep. Aaron Schock said at a news conference Thursday that he would like to see the current 10 percent ethanol blend in gasoline increased to 15 percent and, eventually, 20 percent.

“Throughout the 20-county (18th Congressional) District, farmers have had relatively good years with high prices and high yields, but a number of them are concerned about what the future may hold with any type of dip in yields and prices,” Schock said. “There are things we can do as a government and policy makers to keep prices strong, the markets strong for agriculture and lessen our dependency on Mideast oil.”

WI Governor Proposes Energy Independence Plan

doyle.jpgWisconsin’s governor is proposing an aggressive plan to make his state a leader in renewable energy.

From the text of Gov. Jim Doyle’s speech, he has called for lawmakers to approve his strategy to increase his state’s homegrown power through the Wisconsin Energy Independence Fund:

Over the next 10 years Wisconsin will invest $150 million to help our businesses, our farmers, our foresters, and our manufacturers produce and promote renewable energy.

Our strong manufacturing base and rich agricultural industries, along with the wealth of resources in our vast northern forests and world-leading research universities, position Wisconsin to become the Saudi Arabia of renewable energy.

From manufacturing wind turbines and solar panels to retro-fitting fuel pumps and exploring the latest clean technologies, we will seize green opportunities and create good jobs for our citizens.

But we won’t stop there.

Tonight we’ll launch a new campaign to increase the availability of renewable fuel by 1 billion gallons. First we’ll provide new tax credits for biodiesel fuel producers and add 400 new renewable fuel pumps to our roads. Second let’s pass a renewable fuel standard sponsored by Senator Kreitlow and Representative Suder to require oil companies to provide renewable fuel for our consumers.

Doyle pointed out that ethanol production in Wisconsin has gone from none to half a billion gallons a year since he took office. He says this country needs to depend more on the Midwest… and less on the Mideast.

MO Governor Makes Surprise Announcement

Missouri’s youngest governor has decided not to run for a second term, saying he has accomplished all the goals he had when he took office in 2005. Among those goals was a ten percent ethanol mandate for gasoline, which took effect this month.

Matt BluntBlunt recently announced proposals for $2 million in tax incentives for retailers who install E-85 ethanol pumps and a statewide five percent biodiesel standard.

“Governor Blunt has been as progressive as any public official in the nation on renewable fuels policy,” said Missouri Soybean Association Executive Director Dale Ludwig. “This year, he became the first governor in the country to publicly support a statewide five percent biodiesel standard. He has also shown great leadership by fully funding the biodiesel incentive fund, which helps place biodiesel producers on a level playing field with petroleum companies that receive federal tax incentives.”

The 37-year-old governor’s announcement stunned the state of Missouri since he had already been collecting campaign contributions and even running commercials. Blunt says he has spent 20 years in government service, ten in the Navy and ten in public office, and he wants to spend more time with his wife and young son who was born about the same time he became governor.

Wonder if this means his brother Andy can now keep his shares in the Show Me Ethanol plant without a conflict of interest? (See yesterday’s post on that story)

SD Biodiesel Tax Break Moves Forward

A plan to cut state fuel taxes for biodiesel is moving forward in South Dakota’s legislature.

rounds.jpgThis story from Forbes says the state Senate’s State Affairs Committee voted unanimously to move Governor Mike Rounds’ plan to the full Senate:

The bill would cut the 22-cent-a-gallon tax on diesel to 20 cents for diesel fuel that contains at least a 5 percent blend made from soybeans or other organic material.

The 2-cent-a-gallon tax break would be the same as that given to ethanol, which is a gasoline blend generally made from corn.

The tax break would not start until biodiesel facilities in South Dakota reach a capacity of 20 million gallons a year and produce at least 10 million gallons a year. It would end when production reaches about 20 percent of diesel fuel sold, state Agriculture Secretary Bill Even said.

If passed, the bill would encourage the development of soybean-based biodiesel plants in South Dakota. The state is home to just one small facility now.

Show Me Conflict

Too many political bedfellows are spoiling the chances of a Missouri ethanol plant getting some government financing incentives.

Show Me Ethanol of Richmond, Missouri is scheduled to open this spring, backed by over 700 investors including a congressman’s wife, the governor’s brother and a state legislator. The plant was approved to receive a low-interest loan rate backed by the state, but “no incentives can be given if the company has even a single investor who is a lawmaker, statewide elected official, state department director or a parent, sibling, spouse or child of any of those officials,” according to an AP story.

Blunt BrotherAmong the investors is Andy Blunt, pictured in the AP photo with his brother Gov. Matt Blunt. So far, he is holding on to his shares as plant officials try to negotiate a compromise with State Treasurer Sarah Steelman. State Rep. John Quinn of Chillicothe also owns shares in the plant and he believes the treasurer’s office should relax its policy, perhaps allowing up to 5 percent of investors to have political connections.

Read the Associated Press report here.