Domestic Fuel

Two key programs that will encourage the use of renewable biomass and production of advanced biofuels is available through the FY 2012 USDA budget, according to the Agriculture Secretary Tom Vilsack. About $25 million will be made available through each program.

First, the Repowering Assistance Program provides approximately $25 million in funding to biorefineries that have been in existence on or before June 18, 2008. The purpose of the program is to provide a financial incentive to biorefineries to use renewable biomass in place of fossil fuels used to produce heat or power. By providing this assistance, USDA is helping these facilities install new systems that use renewable biomass.

Eligible costs must be related to construction or repowering improvements, such as engineering design, equipment installation and professional fees. The application deadline for this program to receive funds for Fiscal Year 2012 is June 1, 2012. For additional details, please see pages 5232 through 5234 of the February 2, 2012, Federal Register.

Second, USDA also announced the availability of up to $25 million to make payments to advanced biofuels producers who expect to produce eligible advanced biofuels at any time during Fiscal Year 2012. To be eligible for these funds, an advanced biofuels producers must have enrolled in the program by October 31, 2011, even if the producer has an existing contract with the Agency.

Payments will be made to producers of advanced biofuels derived from renewable biomass, other than corn kernel starch. These include cellulose, sugar and starch, crop residue, vegetative waste material, animal waste, food and yard waste, vegetable oil, animal fat, and biogas.

Contract payments will be made quarterly. For additional details, please see pages 5229 through 5232 of the February 2, 2012, Federal Register.

“President Obama has laid out a new era for American energy—an economy fueled by homegrown and alternative energy sources that will be designed and produced by American workers,” said Vilsack. “These programs support that vision by helping biorefineries use renewable biomass as a replacement fuel source for fossil fuels and supporting advanced biofuel producers as they expand production.”

Ethanol sales from Nebraska have officially reached 10 billion gallons, according to the Nebraska Ethanol Board. The history making tank-full was pumped in late 2011, after 34 years of ethanol being sold in the state.

2012 projections show that Nebraska drivers could purchase close to seven hundred million more gallons this year. Last year, production from the state’s 25 ethanol plants topped 1.9 billion gallons according to preliminary data. 91 percent of the state’s production goes to U.S. domestic markets, five percent goes overseas and four percent stays in Nebraska.

According to the Energy Information Administration, 2011 U.S. ethanol production was 14.4 billion gallons. The country’s total annual motor fuel usage is around 134 billion gallons. Ethanol accounts for 10.7 percent of total U.S supply.

“Our persistence paid off,” says Loran Schmit, a former member of the Nebraska Legislature who laid the groundwork for the development of Nebraska’s ethanol industry. “Ethanol is a major boost to our economy. Continued expansion of the industry will provide greater benefits for agriculture and energy security.”

Sign up for the Nebraska Ethanol Board’s FFV club for updates of new E85 locations and other announcements.

2010 was a tough year for Iowa’s biodiesel producers, but the industry roared back to life in 2011 and set a new production record.

According to the Iowa Renewable Fuels Association (IRFA), ten of Iowa’s 13 biodiesel plants operated during 2011 and produced a combined 169 million gallons. With plants restarting throughout the year, the rate of biodiesel production in December reached over 250 million gallons (annualized).

Iowa produced 48 million gallons of biodiesel in 2010. The previous record production was 85 million gallons in 2009.

“2011 has been a banner year for Iowa biodiesel,” said IRFA Executive Director Monte Shaw. “The reinstatement of the biodiesel tax credit combined with the renewable fuels standard (RFS) helped demand and Iowa was quick to respond. Yet challenges remain in front of us. Congress will once again allow the biodiesel tax credit to lapse at the end of 2011. With the RFS firmly in place, we do not expect the industry to completely shut down as it did in 2010. But the uncertainty of reinstatement will undoubtedly depress demand. Congress must act quickly in 2012 to extend the tax credit.”

Nearly 108 million gallons of biomass-based diesel were sold during the month of November, continuing a record year of production, according to figures released by the EPA. Biodiesel makes up the vast majority of the EPA’s biomass-based diesel category under the Renewable Fuel Standard program, representing about 95 percent of the volume this year.
In a news release from the National Biodiesel Board, biodiesel production specifically had reached an all-time high 908 million gallons through the end of November. The previous annual record for biodiesel production was 690 million gallons in 2008.

Biodiesel is produced in nearly every state in the country and is on pace to support more than 39,000 U.S. jobs in 2011 while replacing roughly 1 billion gallons of petroleum diesel. Made from an increasingly diverse mix of resources such as agricultural oils, recycled cooking oil and animal fats, it is the first and only commercial-scale fuel produced across the U.S. to meet the EPA’s definition as an advanced biofuel. Biodiesel can be used in existing diesel engines and meets strict specifications of ASTM D6751.

Iowa’s ethanol production increased slightly this year; however, the rate of annual growth slowed as the domestic E10 market became saturated, according to the Iowa Renewable Fuels Association.

Iowa has 41 ethanol refineries that produced 3.7 billion gallons in 2011, up from 3.5 billion gallons in 2010.  This represents 27 percent of the estimated 13.8 billion gallons of nationwide ethanol production.

“2011 was certainly a good year for Iowa ethanol producers with increased production and profitability,” said IRFA Executive Director Monte Shaw. “However, we relied on export markets for growth. We’re also facing the expiration of ethanol’s tax credit. Those factors place a premium on pushing the rapid commercialization of E15. Higher blends like E15 are the only way to guarantee increased ethanol production in the future and the jobs and foreign oil displacement that comes with it. We are waiting for final federal approvals, but Iowa will be a leader in E15.”

As we’ve reported before, Biodiesel Analytical Solutions is teaming up with Mcgyan Biodiesel. I learned more about this at the recent National Biodiesel Conference when I spoke with David Wendorf, Mcgyan Director of Marketing. He’s seen here in their booth.

David says Mcgyan was formed about 6 months ago as the company to license their new biodiesel technology. It’s a process that uses a fixed bed catalyst using metal oxide to produce biodiesel. They can use all types of feedstock. That makes them flexible and able to choose the least expensive feedstock available. Feedstock is the most expensive component of the production process. He says they started out a couple years ago after discovering the process. Since then they’ve been scaling up to what is now a large size production facility. He says the plant is performing beyond their expectations.

You can listen to my interview with David here:

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Ethanol plants are cool in a lot of ways. They’re producing a domestic fuel solution to our energy problems and that lessens our dependency on foreign oil for example.

But they can also make a pretty picture too. I was driving south through Missouri last night and passed through Laddonia and the POET plant there.

This was a handheld snapshot from the highway (not much traffic at the time I was passing by).

Doubts about commercial opportunities for cellulosic ethanol are evaporating:

“It is no longer a question of if we are able to produce cellulosic ethanol, but when,” POET CEO Jeff Broin said.

Jeff announced POET’s commitment to develop a commercial cellulosic ethanol plant in Elmersville, Iowa at the Ethanol Conference and Trade Show in Omaha, Nebraska earlier this month. Construction on what POET is calling “Project Liberty” will begin in 2009 and the company expects the facility to be online by 2011. But, POET promises to have a smaller pilot-scale facility up and running by the end of this year.

Jeff says now is an optimal time to take advantage of cellulosic energy because, as he sees it, the industry has sustained strong progress with investments from private industry and academia:

“The stars are beginning to align for cellulosic ethanol,” Jeff said.

POET’s commercial cellulosic plants will process feed stock corn cobs and corn fiber. But, corn isn’t the only source for cellulosic ethanol production that’s poised to go commercial. Bill Schafer, senior vice president of business development Range Fuels, says his company is investing in processing woody biomass for cellulosic ethanol production in Georgia.

In this DomesticFuel Cast, we hear from Jeff Broin, CEO of POET, and Bill Schafer, senior vice president of business development Range Fuels. Here is the Domestic Fuel Cast #8:
df-podcast-08.mp3

You can also subscribe to the DomesticFuel Cast using the following url/feed link: http://www.zimmcomm.biz/domesticfuel/domestic-fuel-cast.xml.

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Pacific Gas and Electric Company says adding renewable solar hybrid power to its energy mix will mean “around-the-clock” clean energy production. PG&E has entered into two contracts with San Joaquin Solar Technology that are meant to combine solar power and biofuel. The contracts equate to 106.8 megawatts of solar thermal-biofuel hybrid power.

Located near Coalinga, CA, the solar-biofuel projects will deliver a total of 700 gigawatt hours (GWh) annually of renewable electricity to PG&E customers throughout northern and central California.

The renewable hybrid projects combine Luz solar thermal trough technology and steam turbines powered by biomass fuel to produce hybrid solar-biofuel renewable electricity. The incorporation of biofuel increases the overall production of renewable power by allowing for around-the-clock production of clean energy, even at night or when sunlight is not at its strongest. Each hybrid project will require 250,000 tons of biofuel annually, to be supplied from a combination of locally-produced agricultural wastes, green wastes and livestock manure. These projects are expected to begin operation in 2011.

San Joaquin Solar LLC is a subsidiary of Martifer Renewables Electricity LLC.

Nova Biosource Fuels is building up its biofuels. The energy company has announced that it has commissioned its second 20 million gallon per year train. It’s biodiesel refinery in Seneca, Illinois has also produced more than 3 million gallons of ASTM 6751 standard biodiesel fuel.

“Our progress at the Seneca refinery continues to solidify our proven process technology that enables the use of high free fatty acid (FFA) feedstocks, which tend to cost less than feedstocks with lower FFA levels,” said Kenneth T. Hern, Chairman and CEO of Nova. “Two of the three trains have operated at nameplate capacity and have exceeded our performance objectives for yield, throughput, and quality. The refinery has successfully demonstrated conversion of feedstocks with free fatty acid levels above 10 percent. To date, we’ve produced more than 3 million gallons, and we expect to begin starting up the refinery’s final 20 MGY train in June. Our B100 quality continues to be excellent.”

“We are commissioning the Seneca refinery one train at a time, spaced at 45 to 60 day intervals to smoothly integrate equipment shakedown, staff training, logistical support, markets and overall refinery operations while ramping up production at a methodical and structured pace,” said Mr. Hern. “We could not be more pleased with the progress on the first two trains and are looking forward with great anticipation to the startup of the final one.”

Nova says it is committed to building and operating a number of Nova-owned biodiesel refineries. The company is aiming to position its production to reach between 180 to 220 million gallons of biodiesel fuel on an annual basis.

Biofuels expert William Frey is the new CEO of SunEthanol. Frey will lead SunEthanol’s commercialization of fuel that is created from plant waste and fast growing grasses.

SunEthanol announced today that it has hired biofuels leader William Frey, Ph.D., as the cellulosic ethanol company’s new chief executive officer.

Previously, Dr. Frey led the efforts to commercialize advanced biofuels and new cellulosic process technologies being developed by DuPont. Frey was one of the first business development leaders who established the DuPont Bio-Based Materials business in the late 1990′s, now known as DuPont Applied BioSciences. He personally led the team that developed DuPont Biofuels as a business unit in 2002, and has broad partnership experience with industry leaders such as BP, British Sugar, Tate & Lyle and Genencor, a division of Dansico, as well as significant experience in working with global government agencies, including the U.S. Department of Energy. Dr. Frey had been with DuPont for 28 years prior to accepting the position as CEO of SunEthanol.

SunEthanol says its mission is to help the nation power automobiles without relying on fossil fuels.

Annual energy production from Brad Foote Gear Works is more than doubling with the purchase of additional advanced gear manufacturing systems. Brad Foote’s purchase from Germany-based Hofler Company amounts to more than $30 million. The company now owns 29 Hofler machines.

With the new equipment, Brad Foote’s annual production will grow from the current equivalent of 2,000 MW of installed wind turbine capacity to more than 5,000 MW.

Brad Foote also has purchased the largest Hofler 4-meter internal/external hobber/gasher that Hofler has ever produced.

Brad Foote is a subsidiary of Broadwind Energy.

DTE Energy and the University of Michigan are sponsoring an annual entrepreneurship competition. The DTE Clean Energy Prize is meant to encourage teams form Michigan colleges and universities to develop the best way for offering new clean-energy technologies commercially.

“Our goal is to drive promising clean energy ideas and technologies from the research lab to commercialization,” Earley said. “To do that, we are making a 5-year, $450,000 commitment to fund the DTE Clean Energy Prize, a new competition open to the best and brightest students and faculty at Michigan’s colleges and universities.”

The prize competition will be hosted by the University of Michigan, but will be open to students and faculty from all Michigan colleges and universities. For the first year, each team must have at least one University of Michigan student or faculty member.

Competing teams will be required to develop business ideas that support renewable energy, energy efficiency and demand response, greenhouse gas and environmental control technologies and energy storage. The first competition will be held this fall. Prizes will be awarded next spring.

LifeLine Foods sells ethanol, but ethanol is just one of many products the company produces. The St. Joseph, MO-based corn milling plant started off as a manufacturer of snack foods in 2001. Today, LifeLine’s identity is continually evolving. The 51 percent farmer-owned company is committed to innovation and is now partnered with ICM, Inc, a world leader in ethanol facility design and engineering, in the production of ethanol.

In this DomesticFuel Cast, we hear from LifeFine Foods CEO Bill Becker about the company’s current innovations with corn, food and fuel and what’s in store for the future.
Here is the Domestic Fuel Cast #4:
df-podcast-4.mp3

You can also subscribe to the Domestic Fuel Cast using the following url/feed link: http://www.zimmcomm.biz/domesticfuel/domestic-fuel-cast.xml.

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