Domestic Fuel

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.”

POET and other leading ethanol producers from around the country announced the launch of a new organization, Growth Energy, at a press conference at the National Press Club today.

“The organization will be dedicated to promoting clean, green ethanol as America’s best renewable fuel that is high-tech and homegrown, reducing greenhouse gas emissions and the nation’s dependence on foreign oil,” said POET CEO Jeff Broin.

Answering questions about why yet another organization for ethanol was needed, “We believe the more associations, the better,” Broin said. He denied that there is any dissatisfaction with the way current organizations, such as the Renewable Fuels Association, have been working to promote biofuels.

The organization has already launched a new advertising campaign and released a policy paper aimed at dispelling the myth perpetuated by the food industry that ethanol is responsible for increased food prices. “When oil and commodity prices rose in early 2008, Big Food reflected their higher prices almost immediately,” said Dave Vander Griend, CEO of ICM. “Today corn prices have dropped by more than half, oil prices have tumbled to less than 65 dollar a barrel, yet food prices continue to go up and so do the mega profits of the major food companies.” Vander Griend says the data in the policy paper released by Growth Energy proves that “food prices and ethanol production are not strongly linked.”

The main companies behind the formation of the new organization are POET, ICM and Fagen – the three largest ethanol plant build/designers. These three companies organized the Ethanol Promotion and Information Council (EPIC) in 2005 and indications are that EPIC may now become part of the newly formed Growth Energy.

Listen to press conference here: growth-energy-edit.mp3

Podcast: Play in new window | Download (12.6MB)

Mr. Ethanol, Jeff Broin, CEO, POET is looking to the future and a new organization that will help open new markets for the renewable fuel.

I spoke to Jeff at last week’s Project LIBERTY field day and asked him what he thinks about the results of our Presidential election. He says, “President-Elect Obama, is going to be I think very, very strong for ethanol.” In fact, Jeff says that POET had one of Obama’s top advisors on energy at their grand opening in Ohio just a couple weeks ago and she stated that he would like to see the RFS increase to 60 billion gallons which Jeff says, “is a great thing for farmers, it’s a great thing for agriculture, it’s a great thing for ethanol.”

An issue that Jeff says presents a challenge to the ethanol industry is the regulatory cap which limits ethanol to 10 percent of the fuel supply – and the industry is bumping up on it now. He says they need access to more markets. For that reason a new ethanol organization is being formed. “We actually are just in the process of working with many other ethanol producers and several ag companies to create a new organization that’s going to drive that agenda forward.” He says we’ll hear more about it shortly.

You can listen to my interview with Jeff here: poet-liberty-08-broin-2.mp3

You can also download the interview with this link (mp3).

Project LIBERTY Field Day Photo Album

Podcast: Play in new window | Download (2.4MB)

When it comes to harvesting equipment for Case IH, Scott Acker is who you want to talk to. He’s their Director, Harvesting Marketing. I spoke with him at POET’s Project LIBERTY field day right after he answered a bunch of questions from farmers who were attending.

Sam says POET approached them with the idea of collecting cobs to make ethanol about a year ago. They discussed the business opportunities and concluded that this was a promising venture. He says they need to provide farmers with incentive and options to harvest both the grain and cobs so POET can make more ethanol. They’re working on it.

The harvesting options Case IH is working on include CCM and a cart behind the combine that collects the cobs separately from the grain. He says it’s best then to just pile the cobs for later pickup.

You can listen to my interview with Sam here: poet-liberty-08-acker.mp3

You can also download the interview with this link (mp3).

Project LIBERTY Field Day Photo Album

Podcast: Play in new window | Download (3.9MB)

The Director of Business Development for POET is Scott Weishaar. He was the guy who told us about the various equipment options on display at their Project LIBERTY field day. That’s because he works directly with the farm OEM’s.

He says the response from the OEM’s is phenomenal. There are several systems already being tested and they should be available in the near future. He says one of the important elements of harvesting cobs for the farmer is being able to do it without “slowing them down.” He also says they’re targeting the collection of cobs to all sizes of farms too. Therefore, there are multiple options and costs for some of these solutions

Options to collect the cobs include CCM (corn cob mix) where the cobs are mixed with the grain during harvest and then separated afterward and towable solutions where the cobs are collected in separate bins during the harvest process.

You can listen to my interview with Scott here: poet-liberty-08-weishaar.mp3

You can also download the interview with this link (mp3).

I also recorded Scott’s stage presentation in which he talks about the whole cob collection process which you can watch here:

Project LIBERTY Field Day Photo Album

Podcast: Play in new window | Download (6.3MB)

Someone had to provide assistance to get all this big machinery to the POET Project LIBERTY field day last week. That someone was MachineryLink, represented by Landon Morris, Vice President, Marketing.

Landon says they’re in the business of leasing late model combines and that they heard about the project a year ago. So what they’re doing is leasing machines directly to POET. He says they’ve used them in their research this summer to test their cob wagons. He thinks that it’s interesting that ethanol companies are now thinking about farm equipment.

You can listen to my interview with Landon here: poet-liberty-08-morris.mp3

You can also download the interview with this link (mp3).

Project LIBERTY Field Day Photo Album

Podcast: Play in new window | Download (2.2MB)

When you’re attending a farm event it’s always nice to get a farmer’s perspective on things. That’s what I did at the POET Project LIBERTY field day when I spoke with Todd Mathisen who farms just east of Emmetsburg, IA. I asked him what he thought of POET’s idea to harvest corn cobs for cellulosic ethanol production. He said, “I think it’s a great idea. I think we’re definitely going to add value to corn. Anything that produces more revenue, it’s going to take more work but I think open-minded farmers will grab hold of this and I think it’ll be a good deal.”

Now that sounds positive. Todd says the cobs are basically a waste product that isn’t even that good for the ground and he likes the idea of turning them into energy. Seems to make sense to me too. He’s a little apprehensive of the equipment that’s being developed and the labor involved but he’s sure that improvements will be made over the next couple years.

I also asked him about President-Elect Obama. He likes the fact that the Illinois Senator has always been supportive of renewable fuels. He’s interested to see what will happen.

Todd says he just finished his harvesting. He worked it wet, planted it wet but thinks he still got a good crop and he seems pretty happy about it.

You can listen to my interview with Todd here: poet-liberty-08-mathisen.mp3

You can also download the interview with this link (mp3).

Project LIBERTY Field Day Photo Album

Podcast: Play in new window | Download (4.0MB)