Domestic Fuel

The U.S. military plans to up its share of biofuels, including biodiesel and ethanol, by nearly a billion gallons over the next few years.

But this article from Biofuels Digest says officials warn that won’t be enough to be the sole driver in the market:

Mark Iden of the Defense Logistics Agency confirmed that the US government proposed to purchase several hundred million gallons of drop-in advanced biofuels by 2016, citing an expected demand of 336 million gallons from the Navy and 587 million gallons from the Air Force.

But Iden, likened the government, although a large customer, to a large commercial airline in terms of purchasing power, and cautioned biofuels producers that the Department of Defense would be a large buyer but not in enough quantity to “singlehandedly drive a market.”

Meanwhile, Navy officials say they will be undertaking a “biorefinery development analysis” to gauge the Navy’s participation in green fuels development.

Researchers at Iowa State University have developed a simulator that allows them to replicate all the functions of biodiesel and ethanol plants.

According to this article from the school, the I-BOS (the Interactive Biorefinery Operations Simulator) will help students in Iowa State’s biorenewable resources and technology program learn about biofuel production, as well as helping the biofuel industry train employees:

“This could be the major component of a curriculum for teaching biofuels operators how to run a plant,” [David Grewell, an associate professor of agricultural and biosystems engineering] said. “It’s like a flight simulator for pilots.”

The virtual control room is now written to simulate the operation of ethanol and biodiesel plants. It keeps track of energy consumption, production efficiency and fuel quality. It also features interactive video clips from real biofuel plants that give students a good look at the entire production process.

Grewell says the simulator will also help operators in case of an emergency at the plant.

The man in charge of a company that sells biodiesel and E85 ethanol to the public has told Congress that it needs to keep funding programs to help offset the costs of infrastructure that make the green fuels available to the public.

This post from Biodiesel Magazine says Matt Horton, CEO of Propel Fuels, told the Senate Committee on Energy and Natural Resources how important it is for consumers to have access to renewable fuels and how S. 187, the Biofuels Expansion Act of 2011 would help that:

“With the primary location of the existing E85 and biodiesel fueling sites in the upper Midwest, much of the balance of the nation remains without such fueling facilities while Chrysler, General Motors, and Ford continue to produce almost 50 percent of their entire production as Flexible Fuel Vehicles,” Horton said.

“According to the DOE Alternative Fuel Data Center, there are approximately 2,350 public E85 fueling stations across the entire nation. This small number of sites serves an E85 vehicle population exceeding 9 million vehicles,” said Horton. “While it is not the government’s role to choose the fuel of the future, government can and should assist the private sector with offsetting the costs of such new infrastructure. We believe that the establishment of an infrastructure income tax credit represents the most appropriate role of government in this effort.”

Horton recommended a 50 percent tax credit (up to $100,000 per site) for putting in infrastructure with the ability to transfer that credit to third parties to help pay for the equipment, among other recommendations.

The U.S. Department of Agriulture has announced nearly $37 million in research grants to promote the production sustainable biodiesel and ethanol production.

This USDA press release says the money is designed to help the country meet the goal of 36 billion gallons of biofuels per year by 2022 and focuses on three areas: crop protection for sustainable feedstock production systems, enhanced value co-product development, and carbon sequestration and sustainable bioenergy production:

“USDA and President Obama are committed to producing clean energy right here at home, to not only break our dependence on foreign oil, but also boost rural economies,” said Agriculture Secretary Vilsack. “These projects will give us the scientific information needed to support biofuel production and create co-products that will enhance the overall value of a biobased economy. This will propel us to out-educate, out-innovate and out-build in the field of renewable energy and help America win the future.”

Some highlights include projects in California and Michigan that focus on biomass feedstocks and some South Dakota projects that design ecologically optimized feedstock production systems and develop biochar.

The full list of award winners is available here.

A new report from the feds says, due to the recession, overall energy consumption in the U.S. dropped in 2009. However, renewable energy … biodiesel, ethanol, wind, solar and hydro power … use during that same period actually increased.

This report from the U.S. Energy Information Administration shows that overall energy consumption in 2009 dropped by 4.8 percent, the second year in a row that consumption dropped and just the third time since 1949 that energy consumption has declined for two or more consecutive years. But clean energy sources fared much better during that same time:

Consumption of all major fuels declined between 2008 and 2009, except for renewables. Coal dropped the most, falling 12 percent, while petroleum consumption fell nearly 5 percent, and natural gas consumption fell 2 percent. Even nuclear fuel consumption fell by nearly 1 percent…

Hydropower consumption grew 6.3 percent in 2009…

The report goes on to say that wind went from a “relatively minor renewable energy source” to making up nearly 10 percent of total renewable energy consumption. In addition, biodiesel and ethanol got good boosts from various financial incentives and mandates.

The USDA wants to know how livestock producers are using co-products from biodiesel and ethanol production.

This story from Ethanol Producer Magazine says the National Agriculture Statistics Service will be taking comments until March 28, 2011 with plans to release the results by next January:

NASS expects to contact 70,000 various livestock and poultry operations in early January to gain information related to their distillers co-products use during 2011. The survey will attempt to determine the rate of use of distillers co-products and various aspects contributing to their decision to use the feed, including nutrient values, product consistency, product form, product testing, inclusion rates, economics, shelf life, storage and transportation. The survey has been named the Distiller’s By-Products Survey in order to encompass all by-products, but Olbert said that focus could be narrowed to concentrate only on distillers grains. “That’s another reason why we need some input from the public and from stakeholders on what kinds of information they need from a survey,” he added.

You can submit comments to the USDA through email to ombofficer@nass.usda.gov. Reference docket number 0535-0247 in the subject line of the email.

A company that is producing ethanol and biodiesel from non-food cellulosic wastes has welcomed a former oil industry executive to its board of directors.

BlueFire Renewables, Inc. announced that Joe Sparano, a former President and, subsequently, Executive Advisor to the Chairman of the Board of the Western States Petroleum Association (WSPA), as well as former president of Tesoro Petroleum’s West Coast Regional Business Unit, joined the California-based renewable fuels maker:

“We are excited to have Joe Sparano serve on our Board of Directors,” stated Arnold Klann, CEO of BlueFire Renewables, Inc. “Having a well-respected petroleum industry executive, such as Joe, agree to join our board provides BlueFire with strategic guidance as we seek to embark on new projects and solidify new and existing partnerships.”

Sparano is retiring from WSPA at the end of March, after completing a fifteen month term as Executive Advisor to the Chairman of the Board of theAssociation, where he advised the Chairman and supported WSPA’s President on matters related to the trade organization’s operations and advocacy in six Western states – California, Arizona, Nevada, Washington, Oregon and Hawaii.

Sparano has held several positions with several different petroleum companies, including Exxon.

The man in charge at the USDA says American farmers are producing enough to provide the food AND fuel, in particular ethanol and biodiesel, this country needs.

During the recent Commodity Classic, Secretary of Agriculture Tom Vilsack took on the food vs. fuel debate head-on.

“It is irritating to me that we have to read about this all the time, because what it is basically is saying is that the folks advancing this argument either do not understand or do not accept the notion that our farmers are as productive and smart and innovative and creative enough to meet the needs of food and fuel and feed and export.”

And Vilsack took the blame for food price increases off the American farmers and biofuels industry and put it on a more likely culprit.

“I think OPEC has more to do with food price increases than farmers,” pointing out that even if you doubled the price of commodities, farmers, with their paltry 20 cents of every food dollar share, wouldn’t see much of an increase in their pocketbooks.

Vilsack said that those who are trying to stop the opportunity for the nation to be more energy secure, while creating good-paying jobs in the biofuels industry, don’t understand what is at stake.

“First and foremost, it is about national security. We import 60 percent of our oil. Sixty percent of the resources we spend on energy are traveling somewhere overseas probably to countries we don’t agree with or don’t like us. It makes far more sense to me to continue to provide opportunities for investment here in the United States.”

Listen to more of Vilsack’s comments on biofuels at Commodity Classic here: Vilsack on Biofuels at Commodity Classic

The Environmental Protection Agency (EPA) has given the green light for E15 ethanol to be used in vehicle years 2001-2007. But what about older cars and trucks?

In this edition of the Domestic Fuel Cast, we listen in to part of the presentation by Ricardo, an internationally recognized automotive and engineering firm, at the Iowa Renewable Fuels Summit, where the company made the case that E15 is OK for vehicles made between 1994 and 2000.

We hear from Ricardo’s Rod Beazley, who explains why they looked at this group of cars and trucks, the challenges involved in the testing, and why the fuel tanks were actually more likely to corrode from the outside and not from the E15 on the inside (the picture on the right is quite telling).

It’s an interesting presentation, and you can see the slide show here and hear what Beazley has to say here: Domestic Fuel Cast

You can also subscribe to the DomesticFuel Cast here.:

Missouri-based MFA Oil Company, a farmer-owned cooperative, has partnered with Aloterra Energy to form a biomass venture.

This MFA press release says the new company, MFA Oil Biomass LLC, will pay about 1,700 family farmers to grow miscanthus for use as a biomass fuel and possibly ethanol in the future:

[T]he 2008 Federal Farm Bill created the Biomass Crop Assistance Program (BCAP), a federally‐funded initiative that encourages the development of renewable energy sources. MFA Oil Biomass will synergistically combine the benefits of growing miscanthus as a renewable energy source with the BCAP incentives that encourage farmers to grow a biomass crop.

The first priority for MFA Oil Biomass is to secure BCAP funding. Under current guidelines, BCAP will reimburse farmers up to 75 percent of planting costs and pay an annual rent payment while farmers wait for their crops to mature. Once the crops mature, farmers will be eligible to receive two years of matching payments for their tonnage, up to $45 per ton beyond the selling price. Land that is currently in the Conservation Reserve Program (CRP) is excluded from the program.

So far, MFA has signed up about 250 farmers to grow more than 12,000 acres of miscanthus and hopes to eventually have that number up to 150,000 acres.

The new year brings talk of new legislation for the ethanol and biodiesel industries.

In this edition of the Domestic Fuel Cast, we talk to some of the leaders of the green fuels’ industries, as well as the head of the nation’s largest farm organization, to get their takes on what should be coming from Washington, D.C. as far as ethanol and biodiesel legislation is involved.

Comments include American Farm Bureau Federation President Bob Stallman explaining why his group wants to shift the public money away from the ethanol blender’s credit towards infrastructure, despite the fact that there are many Farm Bureau members who have ethanol interests. Retired General Wesley Clark, who serves as co-chairman of Growth Energy, a group representing ethanol interests, agrees with Stallman’s assessment of moving more money toward infrastructure. Meanwhile, Renewable Fuels Association president and CEO Bob Dinneen says the real focus needs to be on this nation’s energy policy and welcomes the debate. On the biodiesel side of the house, Chairman of the National Biodiesel Board and vice president of sales and marketing for the nation’s largest biodiesel producer, Renewable Energy Group, Gary Haer, says the green fuel enjoyed a Christmas gift with the renewal of the federal one-dollar-a-gallon biodiesel tax incentive, even though it’s set to expire again at the end of this year. And he says getting that incentive renewed is a big priority for the biodiesel industry in the coming year. Haer also talks about how the biodiesel industry needs to work on its image by making sure people know biodiesel is truly an advanced biofuel, available right now. Those efforts are helped by biodiesel’s partner, the United Soybean Board, whose chairman, Marc Curtis, a soybean grower from Mississippi, points out that biodiesel adds 25 cents to the price for every bushel of beans sold.

It’s an interesting conversation, and I’m sure we’ll hear even more during the biodiesel and ethanol industries respective conferences, both going on in Phoenix, Arizona in February. In the meantime, you can hear what these folks are saying about the legislative year to come in this edition of the Domestic Fuel Cast here. Domestic Fuel Cast

You can also subscribe to the DomesticFuel Cast here.:

There’s a new face on the Nebraska Corn Board staff, and she’ll serve as the board’s ag program manager coordinating ethanol programming.

Kimberly Clark will direct the board’s efforts to increase in-state demand for ethanol, improve and expand the infrastructure of blender pumps and ethanol movement within and outside Nebraska, as well as maintaining a working relationship with ethanol development staff in other corn-producing states, the National Corn Growers Association, ethanol industry groups and Nebraska’s ethanol plants:

“The ethanol industry is critical to Nebraska and Nebraska corn farmers, so having Kimberly on staff to coordinate our ethanol programs is significant,” said Don Hutchens, executive director of the Nebraska Corn Board. “Kimberly’s background and experience will help continue the success we’ve seen with ethanol, and her ability to connect with and educate consumers about ethanol will be a tremendous asset.”

Clark, a native Nebraskan from Leigh, comes to the board from the University of Nebraska-Lincoln, where she served as the research project coordinator in dairy-related research projects.

Just like a year ago, proponents of biodiesel and ethanol must be wondering if their green fuels were part of President Barack Obama’s “clean energy” comments in this year’s State of the Union address. Meanwhile, solar, nuclear and electric vehicle advocates have to be feeling pretty good about themselves as they received specific shout-outs during the hour-long speech.

Appearing before a joint session of Congress (and what seemed like a much more collegial environment), Obama outlined in very broad, non-specific terms, such as “clean energy,” “renewable energy,” and “biofuels,” his vision for the future of alternative energy:

We’ll invest in biomedical research, information technology, and especially clean energy technology – an investment that will strengthen our security, protect our planet, and create countless new jobs for our people.

At the California Institute of Technology, they’re developing a way to turn sunlight and water into fuel for our cars. At Oak Ridge National Laboratory, they’re using supercomputers to get a lot more power out of our nuclear facilities. With more research and incentives, we can break our dependence on oil with biofuels, and become the first country to have 1 million electric vehicles on the road by 2015.

The President also set a new energy goal: getting 80 percent of this nation’s electricity from clean energy sources by the year 2035, and he proposes using wind, solar, nuclear, coal and natural gas … all renewable energy sources … to get to that number. He says we can pay for this by cutting the billions of taxpayer dollars now going to the big oil companies.

As Chinese President Hu Jintao wraps up his visit to the United States, a new report details how America can use biofuels to compete in the alternative energy field for vehicles.

This article on CNET.com says the Accenture report, entitled “The US and China: The Race to Disruptive Transport Technologies,” says the Chinese have a decided edge in government commitment to electric vehicles ($10 billion over the next 10 years to the EV industry alone) and rich deposits of lithium, a key ingredient in EV batteries. But American biofuels could be the great equalizer:

So what does the U.S. have to compete against China’s lithium, money, and government control? To put it succinctly: brainpower, strong intellectual property laws, and agricultural expertise.

The U.S. also happens to be the largest producer of corn in the world with an estimated 30 percent of its yield going into ethanol production. Yield improvements and domestic surpluses are even expected to rise in coming years due to recent agricultural innovations.

The article goes on to say that the U.S. is more diverse in its biofuels package, including biodiesel made from diverse feedstocks, such as algae. China seems to be focusing on cellulosic ethanol to replace gasoline.

The Maryland Grain Producers Utilization Board (MGPUB) have awarded a grant to the Clean Fuels Foundation to support a statewide program to increase the sale of high level ethanol blends. MGPUB will be supporting the National FlexFuel Vehicle Awareness Campaign in a statewide program to increase awareness among owners of flexible fuel vehicles that are capable of utilizing ethanol blends up to 85%.

MGPUB joins the U.S. Environmental Protection Agency (EPA), the U.S. Department of Agriculture (USDA), and more than 30 national companies and organizations that are part of the FFV Awareness Campaign working in several other states across the country. The overall campaign has been developed and is coordinated by the Clean Fuels Foundation, a Maryland based non-profit organization. With 16 E85 stations in the state and another half dozen scheduled to open in 2011, Maryland is a prime location to increase the use of ethanol and continue to expand infrastructure.

According to Marion Wilson, the President of the MGPUB, the FFV Awareness Campaign is a perfect compliment to the recent investment they have made in refueling infrastructure. “This program is the next step in the evolution of the ethanol program. We are getting more refueling locations all the time and the cars are becoming increasingly available. We will make sure current FFV owners are aware their vehicles have this capability and then inform them that these fuels are available and where they can get them,” said Mr. Wilson. “We are sure that when drivers know this we will see an increase in the use of ethanol which provides a range of environmental, energy, and economic benefits,” he said.

“Maryland is a prime candidate to use our small grains like barley for the production of advanced biofuels like ethanol,” said Lynne Hoot, Executive Director of the MGPUB. “By increasing the use of ethanol right here in the state we would offer a great advantage to anyone developing a project in Maryland,” she said.