Energy and Farm Bill Updates

ACEEthanol interests are hoping that Congress might finally get the energy bill into conference committee this week.

Brian Jennings with the American Coalition for Ethanol (ACE) says, “It sounds like Democrats and Republicans are beginning to work out some of the political differences and procedural differences they had in moving forward,” Jennings says. “I would predict that hopefully this week we will have an agreement to move forward on a bi-partisan, bi-cameral conference.”

There are some major differences to be worked out. For one, the House does not have the Renewable Fuel Standard that is present in the Senate bill. The Renewable Fuel Standard is a major goal of many in Congress. Senators Tom Harkin, D-Iowa, and Barack Obama, D-Ill., have introduced stand-alone legislation that would immediately update the Renewable Fuels Standard and require three-billion gallons of biofuels from cellulosic sources.

John ThuneMeanwhile, the Senate Agriculture Committee is finally scheduled to mark up a farm bill Wednesday morning, with chairman Tom Harkin announcing agreement on structure last week.

Senator John Thune (R-SD) says the Senate version of the farm bill will include his legislation designed to promote the production of cellulosic ethanol produced from switchgrass, other native grasses and biomass feedstocks such as wood chips. Thune’s cellulosic ethanol bill, officially known as the Biofuels Innovation Program (BIP), was introduced in May.

Thune’s legislation includes cost-sharing for establishing energy-dedicated crops and paying competitive rent until the energy dedicated crops are sold. The legislation also encourages feedstock production by providing per-ton payments to producers of biomass, such as corn cobs, perennial grasses, and wood chips.

Oregon Setting Standards for Ethanol Production

Do you know what is one of the best things about blog-style news sites? It gives the editors the freedom to not only spark feedback from readers, but to share that feedback with the rest of the site’s subscribers. One subscriber, Tim, pointed out the how ethanol is moving forward in Oregon. I thought that both what he found and what he had to say are every bit of post worthy:

What do democratic Oregon Governor Kulongoski, republican Congressman Greg Walden, an Eastern Oregon Wheat farmer and a barge operator have in common? They were all among the 500 people in Boardman, Oregon on October 5th celebrating the grand opening of Pacific Ethanol’s state-of-the-art biorefinery, Oregon’s first opportunity to produce its own motor fuel. This video shows how renewable fuels are breaking down old political barriers between urban and rural America.

Oregon is doing renewable fuels right–having passed a landmark legislative package that ensures market access; creates incentives for local feedstocks; and encourages efficient production and investment in new technology. The policy is already translating into on-the-ground investment. Oregon provides a great model for other states across the country looking to reap the economic and environmental benefits of renewable fuels.

Blue Fire Gets Biomass Funding

Blue Fire EthanolBlueFire Ethanol Fuels of California has been approved to participate in the U.S. Department of Energy loan guarantee program for clean energy projects..

According to a company release, BlueFire Ethanol was recognized for its proposed project to build a commercial-scale cellulosic ethanol plant in California using an array of low-cost feedstocks including landfill waste.

“The Department of Energy’s continued encouragement of BlueFire Ethanol’s innovative clean energy technology is a key step toward full-scale commercial production of cellulosic ethanol and a testament to the management team’s work over the past 15 years to deploy an economic cellulosic ethanol technology using an array of low-cost cellulosic waste feedstocks,” said BlueFire Ethanol CEO Arnold Klann.

BlueFire Ethanol holds the exclusive North American license to employ the Arkenol Process Technology, a patented, commercially viable and profitable system that transforms cellulosic waste into usable ethanol. As a result, BlueFire is uniquely positioned to set the industry standard in converting waste materials — such as wood waste, green waste, straw, switchgrass, and corn stover — into ethanol.

Agriculture’s Role in Cellulosic Ethanol Production

Acting Secretary of Agriculture Chuck ConnerThe Cellulosic Ethanol Summit is underway in Washington, DC. It’s an interesting mix of people who want to learn more about how we’re going to build this new segment of the fuel ethanol industry.

On hand at lunch time was our Acting Secretary of Agriculture Chuck Conner. He addressed the group on the subject of what agriculture’s role is in building a national cellulosic industry. I caught up to him outside as he was leaving and asked him what his department is doing in this regard.

He says that USDA has several ongoing research projects involving enzymes and the plants that will be needed to use in the production of cellulosic ethanol. However, he says more needs to be done. That’s why the Administration has asked for $1 1/2 billion more in the proposed farm bill for new research in this area. He says the House has supported it and they’re hoping the Senate will too.

You can listen to my interview with Acting Secretary Conner here:

USDA Lowers Corn for Ethanol Forecast

USDAOn Friday, the U.S. Department of Agriculture’s supply and demand forecast has lowered its estimate of how much of this year’s corn harvest the ethanol industry would use by another 100 million bushels. It was the second straight month the forecast has been reduced reflecting lower indicated plant capacity utilization and lower returns for ethanol producers due to recent declines in ethanol prices and continued strength in corn prices.

During a conference call from the Minneapolis Grain Exchange following the report release on Friday, market analyst Brian Hoops with Midwest Market Solutions noted that the decrease was in line with market expectations. “Over time in the next 12 months, if you look at the big picture, the trade would anticipate that ethanol usage would expand rather than contract,” Hoops told reporters. “But at this time it was believed that we would see a small contraction of the usage.”

Meanwhile, exports are projected to be a corresponding 100 million bushels higher on tighter foreign grain supplies and strong export sales. At the projected 2.35 billion bushels, 2007/08 exports would be the highest in 18 years.

It’s also interesting to note that USDA’s objective yield data report in this month’s crop forecast indicates that the number of ears per acre in the ten biggest corn producing states is the highest on record, surpassing the previous record set in 2004.

In summary, corn usage for ethanol is lower than expected this year because the market is adjusting, corn exports are higher than ever, and corn yields are higher than ever.

Announcing WIREC 2008

The United States will host the Washington International Renewable Energy Conference March 4-6, 2008.

WIRECThe conference, which has been held previously in Bonn and Beijing, is an opportunity for government, private sector, and non-governmental leaders to jointly address the goal of advancing renewable energy.

Under Secretary of State for Democracy and Global Affairs Paula Dobriansky hosted stakeholders in the renewable energy industry last week to announce the conference and discuss their goals.

“This conference will play a key role in addressing energy security and climate change,” she said. “WIREC will also provide a platform to promote strategies for the development and rapid adoption of renewable energy systems worldwide,” Dobriansky says.

USDA Undersecretary for Rural Development Tom Dorr also attended the WIREC kickoff to talk about USDA’s involvement in the conference. “It is important in this discussion to remember that renewable energy is in large part rural energy—ethanol, cellulosic ethanol, biodiesel and biomass technology all rely primarily on farm and forest resources, and wind because of its siting requirements is also largely a rural resource,” said Dorr.

POET Finalizes Agreement With DOE

POET and the U.S. Department of Energy have signed a cooperative agreement for a commercial cellulosic ethanol project in Emmetsburg, Iowa.

According to a company release, the agreement finalizes the first phase of a DOE award that was announced in February and will govern all aspects of the project leading up to construction. With the agreement in place, POET will move forward on project preliminary design and engineering, environmental engineering, biomass collection and other activities.

POETAccording to the cooperative agreement, phase one of the project will last approximately 20 months. A subsequent phase two agreement will then be negotiated to cover construction which is expected to take two years. Following construction, facility operation is expected to begin in 2011.

Project Liberty, POET’s cellulosic project, will convert an existing 50 million gallon per year (mgpy) dry-mill ethanol plant in Emmetsburg, Iowa into an integrated corn-to-ethanol and cellulose-to-ethanol biorefinery. Once complete, the facility will produce 125 mgpy, 25 percent of which will be from corn fiber and corn cobs. By adding cellulosic production to an existing grain ethanol plant, POET will be able to produce 11 percent more ethanol from a bushel of corn, 27 percent more from an acre of corn, while almost completely eliminating fossil fuel consumption and decreasing water usage by 24 percent.

ConocoPhillips CEO to Share Thoughts on ‘Shared Energy Future’

Detroit Economic Club“Our Shared Energy Future” is the topic ConocoPhillips Chairman and CEO James Mulva will be discussing on Wednesday October 3, 2007. Mulva will present his thoughts on U.S. energy policy and layout plans for incorporating renewable fuels before the Detroit Economic Club at Burton Manor in Livonia, MI.

Mr. Mulva will describe the shortcomings of current U.S. energy policy, and why this is a critical issue for other industries and all citizens. He will also call for a new, comprehensive national energy policy that incorporates four major tenets: diversifying our energy sources, including fossil fuels as well as renewable and alternative forms of energy; lowering the carbon intensity of our energy supplies; improving the efficiency of energy use throughout the U.S. economy; and the critical need for greater government and private investment in technology and education.

ConocoPhillipsConocoPhillips is the third-largest integrated energy company in the United States, based on market capitalization, oil and gas proved reserves and production; and the second-largest refiner in the United States.

The Detroit Economic Club was formed in 1934 as a platform for the discussion and debate of important business, government and social issues. It is known internationally as a top speaking forum for prominent business and government leaders, who address members and their guests at the Club’s 35 meetings a season.

Biofuels Council offers Biofuel Bio

The biofuels industry is rapidly picking up steam and the fast track growth is spurring a demand for professionals who are educated in biodiesel, ethanol and other alternative fuels. The American Biofuels Council wants to meet that demand wtih a new biofuels educator program.

The American Biofuels Council (ABC), a national grassroots communications network for the advancement of biofuels adoption, has announced that it has launched the Certified Biofuels Educator (CBE) program to train and certify government, corporate, and school staff as well as community volunteers in providing accurate and comprehensive biofuels information.

Sean O’Hanlon, Founder and Executive Director of the ABC, said, “There is enormous demand for this type of program. Government departments, corporations, schools and community groups want to talk to someone who combines local community knowledge with up-to-the-minute awareness of biofuels. Too many people who talk to them have little knowledge, or an axe to grind. This program will solve that problem.”

The CBE course consists of a home-study reading program followed by a weekend of live instruction covering eight modules. CBE candidates will receive training on each type of biofuel including advantages and disadvantages of each, regional considerations, availability of fuels, transition plan development, and community group communications skills. They will also receive comprehensive training on biofuel feedstocks. The course is capped by a proctored examination, and successful candidates will receive the CBE designation. CBE holders will be required to take continuing education courses to retain their Certificate.
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Abengoa Announcement Official

abengoa announcementAbengoa Bioenergy was given a key to the city of Hugoton, Kansas last week after formally announcing plans to build a 300-million dollar cellulose ethanol plant near there.

The plant is expected to be the first commercial cellulosic ethanol facility and will eventually produce 30 million gallons of cellulosic ethanol and 85 million gallons of traditional corn-based ethanol per year.

Gov. Kathleen Sebelius was among the dignitaries at the event on Thursday. She told representatives from the local community that they should be proud of this “cutting-edge project” that will be home “for our new fuel supply” that the rest of the nation and world will be watching.

Abengoa‘s Kansas plant was one of six projects selected nationwide by the Department of Energy to create and develop the cellulosic ethanol industry.

Read more from the Garden City Telegram.

Johanns Meets the Press Club

Johanns Press ClubWhen Secretary of Agriculture Mike Johanns spoke at the National Press Club on July 27, the inevitable question about ethanol was asked.

“Corn-based ethanol may help the nation reduce its dependence on foreign oil, but critics say that ethanol costs almost as much as the energy it produces. Isn’t corn-based ethanol a wasteful way to produce energy, and won’t it increase the cost of food?”

Johanns first response was brief and to the point, “No, and it isn’t.”

After the laughter died down, he elaborated on the issue.

“Every year we have some inflation relative to food, 2 percent, 3 percent, somewhere in that vicinity, some years maybe a little bit more, a little bit less. This year with all of this debate raging we anticipate that food prices across the board will be impacted 2 to 4 percent, about average, maybe a little bit higher. Then when you look at that, many articles I read see that and then they go right to the conclusion, it’s because of ethanol, it’s because the price of corn got high and that’s the reason.

“They leave out a whole big piece of the analysis. What’s the big piece of the analysis? The farmer doesn’t get all of that. I’m sure they wish they did. But they get about 20 cents of the retail dollar. Actually the increase in the price of energy to ship that food can have as much or more of a profound impact on the price of that food than the corn you feed to the animal.”

Read the press club transcript here.

Energy Title of House Farm Bill

The US House passed its version of the 2007 Farm Bill Friday by a vote of 231 to 191 – a vote largely along party lines on a bill that came out of the House agriculture committee as a bipartisan piece of legislation. Republican members of the committee withdrew their support for the bill when a tax increase on foreign owned businesses was added to pay for nutrition programs. House ag minority leader Bob Goodlatte led an unsuccessful attempt to have the bill sent back to committee to find more offsets for funding.

Farm BillDuring a press conference last week, the chairman of the House Agriculture subcommittee on Conservation, Credit, Energy and Research said he the energy title of the bill includes a loan guarantee program of about $2 billion.

“Everyone says we’re too dependent on foreign energy in this country,” said Congressman Tim Holden (D-PA). “This bill allows us to take a giant step forward to take advantage of our agriculture and natural resources for cellulosic ethanol and biodiesel with this loan guarantee program.”

However, Agriculture Secretary Mike Johanns says all the money for cellulosic ethanol research in the House bill is discretionary funding, “which around here means you’ll never see that funding.” Johanns claims that the majority of the funding in the House bill energy title is set aside to buy sugar for ethanol production. “So taxpayers will be buying sugar at twice the world price and then selling it for ethanol.” Johanns says the administration is prepared to veto the farm bill if the final version turns out like the House bill.

The farm bill process is only just beginning. The Senate now must pass its own version of the bill, which is expected to be significantly different than the House version and then it will be on to a conference committee. The current bill expires at the end of September, but since the Senate will not even start work on it until after the August recess, a continuing resolution is likely to be passed to give Congress a few more months.

RFAMeanwhile, the Renewable Fuels Association welcomed House passage of the H.R. 2419, the “Farm, Nutrtion, and Bioenergy Act of 2007.” RFA President Bob Dinneen said in a statement, “We are at a crossroads in this country with respect to our energy future. We can continue on with the status quo and become more vulnerable to the whims of oil cartels around the world. Or, we can invest in American imagination and hard work and move down the path of a more stable, secure energy future. This farm bill clearly takes a step down the latter.” Most major ag organizations have also come out in support of the House bill.

RFA Supports House Ag Farm Bill

RFAThe Renewable Fuels Association is pleased with support for biofuels in the 2007 Farm Bill passed by the House Agriculture Committee last week.

RFA President Bob Dinneen says the programs included in the Energy Title of H.R. 2419 will greatly contribute to ensuring America’s future energy security.

“The programs included in the Energy Title will promote Federal procurement of biobased products, provide loan guarantees for biorefineries and biofuels production facilities, expand research to better utilize ethanol co-products such as distillers grains, study the feasibility of a dedicated ethanol pipeline, and continue the Bioenergy Program to incentivize cellulosic and biomass feedstocks for ethanol production and energy production of ethanol plants,” said Dinneen.

“The RFA thanks the Committee for recognizing the potential of biofuels and providing the agriculture community, through H.R. 2419’s Energy Title, a pathway that will provide a more stable and sustainable energy future for all Americans. The RFA applauds the Committee for their work on this carefully balanced legislation, and we look forward to working with you as H.R. 2419 comes to the floor of the House of Representatives later this week.”

NBB Calls for Passage of Farm Bill

NBB logoThe National Biodiesel Board today called for passage of the U.S. House’s version of the Farm Bill – H.R. 2419, the Farm, Nutrition, and Bioenergy Act of 2007 – especially the parts referring to biodiesel.

NBB officials say the energy title portion of the bill includes an expansion of the Commodity Credit Corporation (CCC) Bioenergy Program and the Biodiesel Education Program. According to an NBB release, the CCC would support production of biodiesel and other bio-based renewable fuels using domestic feedstocks by providing subsidies to help biodiesel producers in this country offset rising feedstock costs. Those costs make up about 80 percent of their overall production expansions.

Funding for the Biodiesel Education Program increases from $5 million to $10 million over five years. NBB officials say the program has been a major reason why consumer awareness and support of biodiesel continues to rise:

Joe Jobe“The NBB believes these energy initiatives are critical in continuing to make biodiesel an important part of a diverse energy portfolio,” said Joe Jobe, NBB CEO. “As the bill moves forward, we will continue to work with our partners in Congress to ensure that necessary funding is provided for these programs, and that the Bioenergy Program is ultimately structured in a manner that will best help the U.S. biodiesel industry reduce America’s reliance on foreign oil.”

The biodiesel industry cranked out 250 million gallons of the green fuel in 2006 and is on track to produce 300 to 350 million gallons this year.

The Future of Biofuels

ErinA middle school student from Merritt Island was in the spotlight at the 2007 Florida Farm to Fuel Summit last week in St. Petersburg for her work in making biofuels.

Yep, you read that right. Erin McCaskey, 12, attends Thomas Jefferson Middle School and her seventh grade science project last year was making biodiesel from a variety of sources.

“I got five different types of oil – used peanut oil, peanut oil, vegetable oil, corn oil and Wendy’s oil (leftover from a local restaurant),” said Erin. “And I made biodiesel and I tested that and E-85 and B-20 in a calorimeter for their energy content.” Used peanut oil was declared the energy winner by Erin.

For her eighth grade project, Erin will be making ethanol from different sources. She sees a bright future for biofuels. “There’s so many ways you can make biodiesel and ethanol – it’s amazing.”

Erin received recognition for her work from Florida Governor Charlie Crist and Agriculture Commissioner Charles Bronson.

Here’s an interview I did with Erin at the Summit:

And here’s a great post about Erin on the BIOStock Blog by C. Scott Miller.

Follow up:
I found out that young Erin got more than just recognition from the governor at the Summit – she also received a free ride to the college of her choice, courtesy of Florida state representative Marty Bowen, Haines City. Read more from the Miami Herald.