Domestic Fuel

The Governor’s Biofuels Coalition met in Sioux Falls Wednesday and sent a letter to members of Congress in support of the Renewable Fuels Standard.

The letter from the 30 governors represented by the Coalition, led by Iowa Governor Terry Branstad, urges Congress to stay the course on the RFS. “As governors who see firsthand the impact that the RFS has had on our states, we urge you to reject any modifications to the RFS,” the letter reads. “By intentionally using misinformation, biofuels opponents damage the nation’s economy, environment, and energy security.”

The governors’ meeting was held at the headquarters of POET and CEO Jeff Lautt says Governor Branstad is a strong defender of biofuels. “He’s seen first hand the success of what this industry’s done for America on the energy side but also what it’s done on the ag side,” said Lautt.

The Iowa Biodiesel Board and Iowa Renewable Fuels Association both praised their governor’s leadership and appreciate the strong stand taken by the coalition to support the RFS.

POET Biorefining – Macon is temporarily suspending plant operations effective Feb. 1 due primarily to a lack of available local corn caused in part by last summer’s drought. All of the plant’s 44 team members will remain employed at their current hours. Many will assist in installation of the approximately $14.5 million in upgrades to the plant that will occur during the down time. The plant will also continue to purchase corn for future use as it is available. There is currently no timeline for resuming production.

The biorefinery started operation in 2000 ad is located in one of the worst-hit areas of last season’s drought, leaving it unable to source corn locally or bring corn in from other areas at a competitive price.

“Macon has been a very successful plant within the POET network,” said POET CEO Jeff Lautt. “Once conditions improve, I know the plant and its hard-working team members will continue to make POET-Biorefining – Macon a star.”

The plant is in the early stages of construction on a number of upgrades that will improve profitability further once production resumes. Those include:

• Voilà corn oil technology, which will provide an additional product for new revenue
• Full BPX technology, POET’s patented “no-cook” process that significantly reduces heat/energy use
• A new control system
• A new, more efficient evaporator
• A new administration building and scale house

Board President John Eggleston added, “We’re all excited to see these upgrades taking effect. It’s investments like these that will ensure continued long-term success for the plant.”

Nearly all of POET’s ethanol plants have now producing corn oil: 25 of their 27 plants have installed corn oil technology bringing its total capacity to approximately 250,000 tons per year, enough feedstock to produce 68 million gallons of biodiesel annually. Branded Voilà, POET has been selling the corn oil since January 2011 with its ethanol plant in Hudson, South Dakota the first.

“Having a more diverse portfolio of products has been a benefit for POET, particularly when ethanol margins are challenging,” said POET CEO Jeff Lautt. “Expanding our product line is an important part of our strategy for growth.”

According to Lautt, one of POET’s four four Ingreenuity goals is to increase production of bio-based products, and corn oil is playing an important role in reaching that goal.

“There’s a bio-based solution to so much of what petroleum supplies today. It’s exciting for me to see POET playing a large part in providing those solutions,” added Lautt.

President Barack Obama has been elected to a second term to lead the United States. While not clairvoyant,  I suspect the defining turn in support for Obama was the convergence of hurricane Sandy and Mayor Michael Bloomberg throwing his support behind Obama with the statement that he is the climate change President. If he is in fact the president for climate change, this should mean positive things for renewable energy. But for this to happen, all of our national and state leaders will need to be climate change leaders.

On the heels of the President Obama’s winning speech, many in the renewable energy industry, such as the National Corn Growers Association, lauded his win and called for the continuation of the path toward change that would lead to energy independence.

“The ethanol industry appreciates the support of President Obama and his administration over the last four years and we look forward to furthering our work with them, continuing to produce a cleaner burning, home-grown renewable fuel,” said Tom Buis, CEO for Growth Energy. He added that his organization is looking forward to working with the president, his administration and Congress in a bipartisan manner to help expand access for biofuels.

POET’s CEO Jeff Lautt said in a statement that his company felt that the role of renewable energy was evident throughout the election and he is optimistic for the future of the biofuels industry.  “As President Obama noted this fall, ‘Biofuels are an important part of reducing America’s dependence on foreign oil and creating jobs here at home.’ I look forward to continued support for the Renewable Fuel Standard to ensure that more and more drivers have access to clean fuel produced here in the United States,” he added.

It’s going to take more than industry associations and alternative energy companies to work for success. It will also take consumer organizations rising up from local communities to spur change and the first step in this is better energy and climate education for all Americans (yes, our country is full of energy and environmental illiterate citizens). There’s a lot to do. Let’s get back to work.

POET-DSM has signed on the International Technology Group ANDRITZ, to supply a two-step biomass treatment process for the commercial-scale cellulosic bioethanol plant under construction in Emmetsburg, Iowa known as Project LIBERTY. The technology was designed to help draw out available sugar in the collected biomass, in this case corn stover, corn cobs, and husks, so it can be converted into cellulosic ethanol.

The ANDRITZ technology is a two-stage process that includes a vertical reactor, an interstage washer and then the continuous steam explosion technology (Advanced SteamEx process) to draw out available sugars from the cellulose material. It’s those sugars combined with Project LIBERTY’s enzyme and yeast technologies – that will get converted into ethanol.

“We’ve been working with ANDRITZ for over four years, collaborating on the development for a treatment process that aligns with our conversion technology development here at POET-DSM, and we selected them to provide that treatment process,” said James Moe, POET-DSM board member. “We’re happy to have them on-board. To say this has been quite a process is an understatement.”

Jay Miele, VP and General Manager with ANDRITZ Inc. added, “Our design teams have been working closely together over the past four years to optimize our Advanced Steam-Ex pretreatment technology for Project LIBERTY. POET-DSM’s dedication to becoming a leader in cellulosic bio-ethanol is quite evident to us. We look forward to successfully completing our part of the delivery for Project LIBERTY, and we are eager to work together on future projects.”

Constructed is scheduled to be complete in late 2013. In preparation, local farmers are increasing the amount of biomass delivered to the site in an effort to fine-tune storage efforts and refine the biomass collection process. Harvest goals for this fall were to collect nearly 85,000 tons of corn cobs and light stover. Eventually, the biorefinery will need nearly 285,000 tons of biomass per year once at full production capacity of 20 million gallons per year.

A new coalition forms to fight back against the push against the Renewable Fuels Standard… a fight prompted by the drought and the pressure the drought is causing on the most common feedstock for ethanol, corn. During a recent news conference, former congressman and now CEO of the Biotechnology Industry Organization… or BIO… Jim Greenwood was one of the leaders of the new coalition dubbed Fuels America, a diverse group of interests, including renewable fuels, national security, renewable energy and other stakeholders. Growth Energy, the Renewable Fuels Association, the American Coalition for Ethanol, the National Corn Growers Association, BIO and the Advanced Ethanol Council are part of Fuels America, as well as several biofuel companies, such as DuPont, POET and Novozymes.

In this edition of the Domestic Fuel Cast, listen in as Greenwood is joined by Novozymes president Adam Monroe, Marion (Ohio) Chamber of Commerce president Pam Hall, and ZeaChem president and CEO Jim Imbler who make the case for preserving the RFS.

You can listen to the Domestic Fuel Cast here: Domestic Fuel Cast

You can also subscribe to the DomesticFuel Cast here.

During the Farm Progress Show, Cindy Zimmerman had the opportunity to sit down with new POET Chief Executive Officer (CEO) Jeff Lautt. Although he has been with the company for nearly eight years, he took the helm as president two years ago and several months ago was tapped as CEO.

Lautt has taken over in a tough year for the ethanol industry as it deals with a major drought that has affected the U.S. corn crop. The main feedstock for all POET ethanol plants is corn. Lautt said the plants are doing well but they are feeling the same pains as other ethanol producers. However, he said, the bigger problem for them is not the high corn prices but access to the market. The industry is currently capped at 10 percent of the fuel market and they are working hard to get equal access in the marketplace. A first step toward this is E15 and the first two stations selling E15 in the country are located in Kansas.

Similar to others in the ethanol industry, Lautt said his company is not in favor of a waiver of the Renewable Fuel Standard (RFS). He said that the legislation is working, the market is working, and knew-jerk decisions shouldn’t be made during a drought. Lautt noted that the RFS includes advanced biofuels, biodiesel and cellulosic fuels and implementing a waiver would not just hurt corn-based ethanol but all biofuels. He added that the industry doesn’t need a government solution.

Lautt also gave an update on Project Liberty, the company’s project to commercialize cellulosic ethanol using corn stover. One of the things they are learning right now is how to harvest the stover as well as store the stover, which may vary based on the environmental state of stover (i.e. wet, dry, etc.).

Listen to Cindy’s interview with Jeff Lautt where he also discusses some new technologies in the pipeline: Getting to Know POET's new CEO

2012 Farm Progress Show Photo Album

Good news is emerging from the most recent soil data of the Project LIBERTY biomass harvesting research in northwest Iowa. Harvesting crop residue can be a responsible part of good farm management.

Project LIBERTY is a commercial-scale, cellulosic ethanol plant that is scheduled to begin operations in Emmetsburg, Iowa in late 2013. The plant will use corncobs, leaves, husk, and some stalk and is expected to produce 20 million gallons of ethanol growing to approximately 25 million gallons per year. It is the first project of the POET-DSM Advanced Biofuels Joint Venture.

For the last four years, Project LIBERTY has commissioned soil sustainability work from researchers with Iowa State University and the USDA. They have studied six different harvest methods in an effort to provide area farmers with data to help them make decisions about biomass harvesting.

“Basically, at the removal level that POET-DSM recommends, there is no reduction in yield, and removal rates are well within the sustainability limits,” said Dr. Stuart Birrell with Iowa State University.

Birrell and Dr. Douglas Karlen of USDA-ARS led the research.

The most recent data is consistent with previous years. Birrell said nutrient replacement is minimal, with no evidence of a need to replace nitrogen. Based on the research, POET-DSM recommends to farmers the addition of 10-15 pounds of potash when soil tests indicate it is needed. The effects of biomass harvesting on soil carbon have also proven to be minimal according to measurements of soil organic carbon, Birrell said, more an effect of yield and tillage intensity than biomass removal.

POET-DSM contracts for about 1 ton of biomass per acre with participating farmers. That’s less than 25 percent of the available above-ground biomass. They are contracting for 85,000 tons this year, and once operational, Project LIBERTY will require about 285,000 tons per year.

POET is off and running with the installation and production of Voilà, its branded corn oil that is used to produce biodiesel. Fourteen plants have installed the technology increasing annual production capacity to nearly 235 million pounds per year. This is enough corn oil to produce nearly 31 million gallons of biodiesel. Voilà technology was first installed in January 2011 at the POET Biorefining-Hudson facility.

“We’ve had a great response from Voilà customers, and I’m excited to be able to expand production to meet more of the demand,” POET CEO Jeff Lautt said.

POET has been expanding the use of each kernel of corn for many years and today the company produces animal feed including Dakota Gold distillers dried grains. In addition, five plants capture carbon dioxide and are sold to companies such as beverage producers.

Lautt added,  “At POET, we’re focused on getting the most value from corn as we possibly can. Ethanol is obviously a big part of that, but the many other products we produce are also very important to our business. We’re also working hard to develop even more biorefined products.”

Right after Growth Energy launched a new website featuring a Flex Fuel Finder application, I got to chat with Tom Buis, Growth Energy CEO, and Jeff Broin, Growth Energy Board Member and CEO of POET. They each expressed the positive impact RFS has had on the ethanol industry and the importance of keeping it implemented. Along that line they discussed what tools Growth Energy has put into place to educate the general consumer about E15 and Flex Fuel pumps.

Growth Energy launched a new user-friendly interface for EthanolRetailer.com, a website that seeks to outline the benefits of ethanol and the growing availability of Flex Fuel pumps. The website launch is part of Growth Energy’s new national campaign to increase awareness of E15.

The website is a comprehensive and easy to use resource for current and prospective ethanol retailers across the company, as well as consumers. It also features a Flex Fuel Finder application, which simplifies the process of locating ethanol blend pumps. The application is accessible from both the website and as a smartphone app, making it easier for Americans to locate cheaper, cleaner fuel while on the go.

Listen my interview with Tom Buis and Jeff Broin here: Interview with Growth Energy

2012 Fuel Ethanol Workshop Photo Album

Bob Casper, President of POET Ethanol Products, was named Chief Commercial Officer of POET. In this newly created position, Casper will oversee the marketing and distribution of all products as well as risk management for POET.

Since 2000, Casper has led POET Ethanol Products, which markets all of the ethanol and carbon dioxide for POET’s network of 27 biorefineries. Before serving as president of POET Ethanol Products, Casper spent 21 years leading several energy-related divisions for Wichita, Kan.-based Koch Industries. Casper serves on the Board of Directors of POET, LLC and Growth Energy, the advocacy group representing producers and supporters of ethanol. He graduated from Trinity University in 1977 with a Bachelor of Arts degree in biology.

“Under Bob’s 12 years of leadership, POET ethanol products has become one of the largest and most successful marketers of ethanol in the world,” said POET CEO Jeff Lautt. “Bob has been instrumental in building the market for ethanol to where it is now in over 90 percent of the gasoline gallons sold in the U.S. In the past few years, Bob has successfully managed numerous challenges from the blend wall and expanding export markets to the expiration of ethanol tax credits and the introduction of E15.”

In this new role, Casper will continue to lead POET Ethanol Products, which markets ethanol, carbon dioxide and denaturant. He will also oversee POET Risk Management and POET Nutrition. POET Risk Management provides commodity futures risk management, corn and natural gas derivatives trading and corn and natural gas procurement services for the network of biorefineries. POET Nutrition markets POET’s branded products: Dakota Gold® high protein animal feed, Voila American Corn Oil and Inviz™ natural zein.

“After working for over 20 years in the oil industry, I am passionate about the role that renewable products can play in our world. That’s why I got into this business and am excited about this expanded role,” Casper said. “We have excellent teams in product marketing and risk management, and I’m looking forward to working with them to develop markets for our growing portfolio of products and manage the company’s risk.”

The founder of the country’s largest ethanol company is stepping down as CEO.

POET founder Jeff Broin will continue managing and leading the company’s board as Executive Chairman, while Jeff Lautt has been named CEO. Lautt has been with POET since 2005, serving as President of the company for the past year.

In stepping down as CEO, Broin says he wants to spend more time with his family and take on new challenges. “I will continue to be involved in strategic direction for the company as Executive Chairman of the Board, and leave the day-to-day operations to our very capable management team. I would not have done this had I not been convinced that the company would be in good hands. Under the leadership of Jeff Lautt and the entire management team at POET, I have confidence that the company will continue to lead the industry into the future.” Broin is married and has three children. In his more than two decades of leadership, POET has grown from 1 million gallons of ethanol that first year to an annual capacity in excess of 1.6 billion gallons.

In addition to serving as Executive Chairman of POET’s Board of Directors, Broin will continue to speak out on behalf of ethanol and agriculture as co-chairman of Growth Energy. He also intends to spend more time guiding the activities of his newly created foundation, “Teach a Man to Fish” which will spread the power of agriculture throughout the developing world.

“For the past 25 years, Jeff Broin has led POET and the entire ethanol industry,” said Lautt. “He has grown POET from one small plant to a leadership position in the global renewable fuels industry. With the help of the entire team at POET, I will do my best to continue building on the success the company has achieved.”

Prior to being named president of POET in March 2011, Lautt served as Executive Vice President of Corporate Operations where he was responsible for all operational business units within the company. Lautt spent fourteen years in the emergency vehicle industry where he served as President of a Midwestern-based fire truck manufacturing company before joining POET. Lautt has a Bachelor of Science degree in Business and Engineering from South Dakota State University.

POET–DSM Advanced Biofuels will be celebrating the start of construction Tuesday on Project LIBERTY, the planned commercial-scale ethanol plant in Emmetsburg, Iowa.

The joint venture between Dutch life sciences firm Royal DSM and ethanol giant POET announced the groundbreaking when the partnership was made public in January. “The joint venture anticipates that we’ll complete construction of Project LIBERTY and start producing cellulosic ethanol in the second half of 2013,” said POET CEO Jeff Broin. “Together, we’ll produce a home-grown, renewable fuel that can create jobs, clean our environment and make us less reliant on foreign oil. This partnership has the potential to change the world.”

Iowa Governor Terry Branstad and representatives from POET-DSM Advanced Biofuels will take part in the formal groundbreaking for the plant starting at 10:30 Tuesday morning in Emmetsburg.

POET is targeting dairy producers with the introduction of a new low-fat distillers grains product.

The South Dakota-based ethanol producer notes that research indicates its new Dakota Gold Low Fat dried distillers grains with solubles (DDGS) can be fed to dairy cattle at a higher inclusion rate than traditional DDGS.

According to Kip Karges, PhD, Technical Services and Research Director at POET Nutrition, the product has just a 5 percent fat content, which offers a new opportunity for dairy operations that have had to limit DDGS use in the past because DDGS fat content can cause milk fat depression issues. “Dairy operations can feed more low fat DDGS to their livestock by using Dakota Gold Low Fat,” Karges said. “That will allow for optimum milk production while lowering ration cost.”

General research into the subject has shown that increasing concentrations of low-fat distillers grains have correlated to increasing efficiency of milk production. “When feeding regular DDGS you really have to limit feeds with high levels of unsaturated fatty acids and may cause limitations in formulation procedures,” said Paul Kononoff, Associate Professor of Dairy Nutrition/Dairy Nutrition Specialist at the University of Nebraska in Lincoln. “The reduction in fat in low fat DDGS allows for higher inclusion of the co-product without the worries of milk fat depression.” Kononoff and others as the University of Nebraska have performed trials for POET and will be releasing their data to the public this summer.

A deliberate research and development process was followed in bringing Dakota Gold Low Fat DDGS to market. The new Dakota Gold LF DDGS option is possible because of POET’s Voila™ Corn Oil production, which removes oil from DDGS. The resulting low fat DDGS have been researched and will continued to be researched to find new ways in which distillers grains, the second-largest traded feed ingredient on the market, can be used to produce protein for human consumption. Nutritionists at POET are providing animal research data to nutritionists and the feed industry in general regarding Dakota Gold LF DDGS. Research and nutrition details are available at the Dakota Gold website.

Ethanol giant POET is partnering with a Netherlands-based life sciences company with the intention of making advanced biofuels a reality by next year.

POET has announced a joint venture with Royal DSM to commercially demonstrate and license cellulosic bio-ethanol based on their proprietary and complementary technologies. POET–DSM Advanced Biofuels, LLC, is scheduled to start production in the second half of 2013 at one of the first commercial-scale cellulosic ethanol plants in the United States.

The two partners will produce cellulosic ethanol from corn crop residue through a biological process using enzymatic hydrolysis followed by fermentation. The first commercial demonstration of the technology will be at Project Liberty, which is currently being constructed adjacent to POET’s existing corn ethanol plant in Emmetsburg, Iowa. The initial capacity is expected to be 20 million gallons in the first year, growing to approximately 25 million gallons per year.

DSM and POET will each hold a 50% share in the joint venture, which will be headquartered in Sioux Falls, South Dakota. The initial capital expenditure by the joint venture in Project Liberty will amount to about $250 million. The closing of the joint venture is subject to regulatory approvals and other customary closing conditions.

As a result of the joint venture project, POET has also announced its intent to decline the $105 million loan guarantee it was awarded by the U.S. Department of Energy (DOE) in September. POET will officially decline the guarantee prior to drawing any funds when the joint venture closes.

Listen to some comments from DSM Managing Board Chairman/CEO Feike Sijbesma and POET CEO Jeff Broin and questions from media during a telephone press conference today: POET-DSM press conference