Attendees of the recent Fuel Ethanol Workshop and Expo in Denver, Colorado heard something they most likely already knew: the past year was a rough one for the ethanol industry.
While some folks such as Mike Bryan, CEO of BBI International point out that much of the green fuel’s woes were a concerted effort by those outside of the industry to spread misinformation, Bryan and Bob Dinneen, President and CEO of the Renewable Fuels Association insisted it’s time for ethanol to take back the message and spread the good news… like the fact that the industry has created 500,000 jobs and pumps $66 billion into the American economy.
Others focused on how new, alternative feedstocks, in particular, cellulosic, and advances in corn technology will make it possible to have the food, feed and fuel this country needs in the years to come.
It was a fascinating discussion, and we bring you a bit of the conversations from FEW in this latest edition of the Domestic Fuel cast. Listen to folks like Bryan; Dinneen; Dave Vander Griend, CEO of ICM Incorporated; Jeff Broin, CEO of ethanol producer POET; David Hiller, Executive Director of the Colorado Renewable Energy Collaboratory; and Larry Johnson from the North American Business Development division of biomass ethanol producer Inbicon here: DFCast-6-28-09.mp3
POET CEO, Jeff Broin, announced a new division for the company this morning at the Fuel Ethanol Workshop. POET Biomass will be “a division of POET devoted to managing harvest and transportation logistics for corn cobs – POET’s cellulosic feedstock – as well as waste wood and other feedstocks to be used for cellulosic ethanol and alternative energy projects at their production facilities.”
In addition to the new division, Broin, says the company has installed an anaerobic digester at POET’s pilot cellulosic plant in Scotland, SD to create a “a self-sustaining energy cycle for producing cellulosic ethanol.”
Corn cobs at Project LIBERTY will not only be used to produce ethanol; the liquid waste will go to an anaerobic digester to power the cellulosic plant and offset natural gas usage at the attached grain ethanol plant as well. That’s renewable energy created at the plant, powering the plant and powering the adjacent facility.
Members of the biofuels industries, including those growing the feedstocks to make the green fuels of ethanol and biodiesel, made their way to Washington, D.C. this week to try to stop the Environmental Protection Agency (EPA) from implementing rules that the biofuels folks will hurt their industry.
The biggest point of contention is the EPA’s Indirect Land Use proposal that could end up making American biodiesel ineligible to be part of the Renewable Fuels Standard… endangering the biodiesel industry and the very standard designed to lower the amount of greenhouse gas emissions. And while ethanol is getting a pass for now, those from that industry are worried how the Indirect Land Use provisions, which estimates the deforestation of rain forests in places such as South America based on how much in row crops U.S farmers grow, could eventually affect them.
Those testifying at the EPA hearing included Renewable Fuels Association President and CEO Bob Dinneen; Steve Ruh, chair of the National Corn Growers Association’s Ethanol Committee; the National Biodiesel Board’s Manning Feraci; the American Soybean Association’s Vice President Ray Gaesser, a soybean producer from Corning, Iowa; POET Vice President for science and technology Dr. Mark Stowers; and Brent Erickson, executive vice president of the Biotechnology Industry Organization’s Industrial and Environmental Section. About 60 people testified at this hearing.
Numerous biofuels representatives testified at a day-long hearing Tuesday in Washington DC on the Environmental Protection Agency’s proposed rulemaking for the Renewable Fuels Standard.
National Corn Growers Association (NCGA) testified that corn growers have serious concerns about assumptions in the proposed rule regarding indirect land use changes. Ethanol Committee Chairman Steve Ruh says EPA has failed to take into account modern agricultural practices and biotechnology that are increasing both corn yields and ethanol production.
“Over the past nine years, a time when ethanol production grew dramatically, for every bushel required for the increased ethanol market, 2.89 new bushels were grown on the same acres, thus requiring no additional acres be brought into production for the purpose of ethanol,” Ruh testified.
POET VP for science and technology Dr. Mark Stowers told EPA that the model for calculating indirect land use changes is “flawed and has no basis in law or science.”
Stowers urged EPA officials to visit a modern ethanol plant to “obtain real data about the industry, rather than relying on unproven models, hypotheses and assumptions.”
About 60 people testified at the hearing yesterday, split about evenly between those who supported the rule and those who wanted to see changes.
The Environmental Protection Agency (EPA) announced today that it is seeking public comments on the “Green Jobs Waiver” that was submitted several weeks ago requesting the current ethanol blend be increased from 10 percent ethanol (E10) to 15 percent (E15). Since 1978, the limit has been set at E10 for conventional (non flex-fuel) vehicles. The comment period will be open for 30 days after the notice is published in the Federal Register which is expected to happen on April 22nd. Last month, the Underwriters Laboratories (UL) certified all current dispensers and components for E15.
In a company statement, Jeff Broin, CEO of POET said, “Lifting the arbitrary cap and allowing ethanol blends of up to 15 percent is our nation’s means to achieve commercial-scale cellulosic ethanol, green jobs and a better environment. It is important that Americans use this comment period to let the Environmental Protection Agency know how important homegrown ethanol is to our nation.”
Growth Energy and 54 ethanol manufacturers submitted the E15 application to EPA on March 6, 2009. Current statute calls for EPA to make a decision within 270 days of receipt, which is December 1, 2009. It is imperative for the biofuels industry that the blend wall is increased in order for the ethanol industry to achieve the biofuel levels as set out in the Renewable Fuels Standard (RFS). Increasing the blend wall will also help ensure that there is a market for cellulosic ethanol when full-scale plants come online.
According to a POET press release, POET Biorefining in Bingham Lake, Minnesota, has used a new technology wich will eliminate water discharge providing a more efficient way to produce ethanol.
The 35 million gallon per year facility currently uses less water than average plants. Bingham Lake facility used 3.42 gallons of water to produce one gallon of ethanol. With zero-liquid discharge, that is cut by 23 percent, to an estimated 2.64 gallons of water per gallon of ethanol.
“This process is yet another way POET is working to continue making ethanol production more efficient,” POET CEO Jeff Broin said. “Zero-liquid discharge technology benefits the plant, the community and all the area water users.”
Additional POET facilites use innovative ways to cut water use including: Corning, Iowa; Portland, Indiana; and Big Stone, S.D. POET plants on average use 3 gallons of water per gallon of ethanol.
EPA recently held a ceremony and awarded Missouri Joint Municipal Electric Utility Commission (MJMEUC) with an ENERGY STAR Combined Heat and Power (CHP) Award. This award was in recognition for their reducing energy consumption and greenhouse gas emissions at the POET Biorefining – Laddonia, Mo., ethanol plant.
“EPA is proud to recognize the outstanding pollution reduction and energy efficiency innovations of this project by presenting this award. The heat recovery system is contributing to a cleaner and healthier environment,” said Acting Regional Administrator William Rice.
By using a natural gas-fired turbine, about 26 percent less fuel is used at the Laddonia plant. This equates to a reduction in carbon dioxide emissions by an estimated 31,000 tons per year.
POET CEO Jeff Broin said, “We want to thank the Missouri Joint Municipal Electric Utility Commission for helping POET in its mission to further reduce the environmental impacts of transportation fuel. As this partnership demonstrates, we are committed to making the production of ethanol even more efficient.”
The Sioux Falls Landfill is now providing methane gas to help power the daily operations of POET’s 105 million gallon per year ethanol plant in Chancellor, South Dakota.
POET CEO Jeff Broin joined representatives from the City of Sioux Falls and the Landfill Methane Outreach Program (LMOP) of the U.S. Environmental Protection Agency (EPA) for a ribbon cutting ceremony at the Sioux Falls Landfill on Friday.
Among those on hand for the event was LMOP program manager Swarupa Ganguli with the EPA, who explained that the program is a voluntary partnership that promotes the use of landfill gas as an energy source. “This is one of three projects in the country where landfill gas is used in the production of ethanol and the first in the state of South Dakota,” said Ganguli. “The annual environmental benefits from using this gas for power is equal to removing emissions from more than 27,000 passenger vehicles, removing carbon dioxide emissions from more than 344,000 barrels of oil or sequestering carbon with nearly 34,000 acres of pine or fir forests.
The 10-mile, low-pressure pipeline from the Sioux Falls Regional Sanitary Landfill began supplying methane to the plant at the end of February, ahead of the expected completion date. The POET plant will utilize the landfill gas in a wood waste-fuel boiler to generate process steam. Combined, the two alternative energy sources will initially offset up to 90 percent of the plant’s process steam needs currently met using natural gas and has the potential to replace 90 percent of the plant’s total energy needs (combined with waste wood) over time.
The nation’s largest ethanol producer is joining forces with a fuel transportation and distribution company to work on the development of a pipeline to deliver ethanol from the Midwest to distribution terminals in the northeastern United States.
South Dakota-based POET just signed a joint development agreement with Magellan Midstream Partners of Tulsa, Oklahoma to continue assessing the feasibility of constructing a dedicated ethanol pipeline.
The proposed common carrier pipeline system would gather ethanol from production facilities in Iowa, South Dakota, Minnesota, Illinois, Indiana and Ohio to serve terminals in major Northeastern markets. The project, preliminarily estimated to cost in excess of $3.5 billion, would span approximately 1,700 miles and would take several years to complete.
The feasibility of this project is dependent upon the successful outcome of ongoing studies addressing technical and economic issues associated with the transportation of ethanol via pipeline. In addition, federal legislation revising the U.S. Department of Energy’s loan guarantee program is critical for a project of this nature to move forward.
Kansas-based Crescent Oil Company has filed for bankruptcy after failing to make deliveries last week to many retailers the company serves in the Midwest. The sudden move comes just two weeks after Crescent took part in a grand opening for NewGen Fuels, a joint venture with ethanol plant owner/designers ICM and POET.
Officials with NewGen say their goal to offer “new generation” ethanol-blended fuels at hundreds of retail outlets remains the same, but the timing could be affected.
NewGen President Alan Goodnight was quoted in the Wichita Business Journal. “We’re still focused on the mission of NewGen,” Goodnight says. “We don’t see these unfortunate events in any way changing the mission or changing our objective. Crescent Oil was also a partner in NewGen LLC and still is.”
An oil distributor that is part of a recently-announced joint venture with POET and ICM to deliver new generation fuels caused some panic this week when it failed to deliver old generation fuel to gas stations across the Midwest.
Officials with Crescent Oil Company, a fuel supplier for seven Midwest states, had no comment Friday about claims that this week’s fuel deliveries never arrived. Several retail operators in Kansas and Missouri say that regular deliveries from Crescent did not arrive as scheduled on Wednesday, prompting rumors of fuel shortages, driving up gas prices and ultimately forcing them to find other suppliers. Crescent Oil is a wholesale supplier for several major oil companies and distributes fuel to more than 340 locations in Kansas, Oklahoma, Arkansas, Missouri, Illinois and Louisiana.
Just last week, Crescent took part in the grand opening of a NewGen “Renewable Fuel” retail station in Topeka, Kansas, together with partners POET and ICM.
According to a press release on the opening, “NewGen Fuel™ will provide owners of flex fuel vehicles (FFVs) the freedom to choose domestically produced midrange ethanol blends, through Crescent Oil Company’s efficient fuel distributorship and POET’s robust supply of ethanol.”
“We’re extremely excited to celebrate the grand opening of the first “Renewable Fuel” retail station in our state capital,” said NewGen Fuel president Alan Goodnight. “And we’re equally grateful for the extraordinary collaboration to form a joint venture with industry leaders, Crescent Oil Company and POET.”
Local news reports indicate that Crescent Oil is experiencing financial difficulties but had not filed bankruptcy.
Growth Energy has announced that it will name “a major national figure” this week as co-chairman of the recently formed ethanol advocacy group.
According to a Growth Energy announcement, “This individual will bring foreign policy experience, environmental leadership, and political expertise to the organization and will be a strong advocate for policies that will help promote renewable energy and create green-collar jobs.”
The announcement of the co-chairman will be made on Thursday. Growth Energy was formed late last year by POET CEO Jeff Broin and other ethanol industry leaders.
The world’s largest corn ethanol producer is now successfully producing cellulosic ethanol at a pilot plant in South Dakota.
According to company officials, POET Research Center in Scotland, S.D. is now producing cellulosic ethanol at a rate of 20,000 gallons per year using corn cobs as feedstock.
“The start-up of the pilot scale facility has been extremely smooth,” said POET CEO Jeff Broin, who held a telephone press conference Monday calling it a “grand opening” of the plant – although weather prevented them from actually holding the call at the facility. “After producing 1,000 gallons, we’ve already been able to validate all of what we learned in the lab and believe the process will be ready for commercialization when we start construction on Project LIBERTY next year.”
Broin stressed the potential for producing cellulosic ethanol from corn cobs and other agricultural waste products. “Because they are being grown today, they don’t require farmers to plant a new crop,” said Broin. “And there are lots of them. Enough to produce five billion gallons of ethanol every year. That’s five billion gallons of ethanol that can come from what is a waste product today.”
Broin is optimistic about being able to achieve commercialization of cellulosic ethanol by 2011 but he hedged when asked whether he thought the industry would be able to meet the goal of 100 million gallons by 2010. “This is a brand new technology, it takes time to develop it, so we’re going to have to have a wait and see attitude,” Broin said. “You can put a number on a piece of paper, but it’s going to come at the speed at which the technology is developed.” However, he noted that the industry has been very successful in the past at meeting and even exceeding the goals set forth.
The American Council on Renewable Energy (ACORE) held a two day forum on Capitol Hill last week with hundreds of renewable energy executives, financial experts, and policy makers who remain optimistic about the industry’s future.
The 2008 Phase II of Renewable Energy in America National Policy Forum featured Policy recommendations on renewable energy, energy efficiency, sustainable development, the environment and green jobs.
“There has never been a more opportune time to instill the philosophies of Phase II into federal policy,” said Michael Eckhart, President of ACORE. “There is a pressing need for policy stability so that companies have a reasoned basis for making long-term investments in factories and the financial community has confidence making investments in new projects.”
Among those who spoke was POET CEO Jeff Broin, who says the government needs to act within the next six months to increase the amount of ethanol that can be added to gasoline.
Broin warns that the ethanol industry will run into the so-called “blend wall” at 12.5 billion gallons because of the Environmental Protection Agency’s 10 percent ethanol blend limit.
Another speaker, former Senator Tom Daschle, spoke about the progress on biofuels noting that the United States must continue to turn to biofuels and next generation ethanol to reduce our dependence on oil.
The nation’s oldest ethanol advocacy organization is welcoming the formation of Growth Energy, a new group announced Tuesday in Washington DC.
In a statement, the Renewable Fuels Association (RFA) said it “welcomes Growth Energy’s support in tackling challenges and seizing upon the opportunities before America’s ethanol producers. On behalf of ethanol producers across America and in conjunction with our international colleagues, the RFA remains committed to expanding ethanol markets and reducing our dependence on foreign oil, dispelling misinformation about ethanol production and use, addressing climate change, and assuring the full potential of American farmers and ethanol producers is realized and put to work. We welcome another voice in Growth Energy in support of America’s farmers and ethanol producers.”
RFA has served as the voice of the ethanol industry since 1981, providing advocacy, authoritative analysis, and important industry data to its members, Congress, federal and state government agencies, strategic partners, the media and other opinion-leader audiences.
Growth Energy was formed by a group of ethanol companies – including POET, ICM, Western Plains Energy, Amaizing Energy, Hawkeye Renewables, Green Plains Renewable Energy – “committed to the promise of agriculture and growing America’s economy through cleaner, greener energy.”