Domestic Fuel

The Senate Agriculture Committee voted 15-5 today to approve the Agriculture Reform, Food and Jobs Act of 2013, which includes cuts to reduce the deficit by $23 billion dollars but still offers a commitment to renewable energy.

The bill includes an energy title that helps to advance “bio-energy production, supporting advanced biomass energy production such as cellulosic ethanol and pellets from woody biomass for power.”

The bill also provides support for blender pumps and higher ethanol blends, which was welcomed by the ethanol industry. “The American Coalition for Ethanol (ACE) thanks Chairwoman Stabenow and members of the Senate Agriculture Committee for adopting a Farm Bill which provides $800 million in mandatory funding for critical Energy Title initiatives, particularly $241 million in mandatory funding for the Rural Energy for America Program (REAP),” said ACE Executive Vice President Brian Jennings. “REAP provides vital cost-share assistance to help petroleum marketers make upgrades or install new equipment at retail stations, ensuring consumers have access to renewable and affordable fuels such as ethanol. Today’s action highlights strong bipartisan support for market access to E15 and midlevel blends, such as E30 or E85. We encourage the U.S. Senate to take action soon to enact the Farm Bill.”

The bill is expected to move to the Senate floor next week.

What do Orca whales and solar energy have in common? Nothing until now. Canadian Solar Solutions has donated solar modules to power the OrcaLab Whale Research Centre, on a remote island off the British Columbia coast near Alert Bay. OrcaLab has been recording the Johnson Strait whales for more than four decades. Founder, Dr. Paul Spong and his wife Helena Symonds have spearheaded global research that confirms orca “clans” have distinct, highly sophisticated dialects. This scientific evidence in turn has led to bans against commercial orca hunting, and to the creation of nearby orca sanctuaries.

“The solar installation is performing beyond our expectations,” said Dr. Paul Spong a whale expert and advocate. “We are now running all of our power needs without a generator, and looking forward to a future here without oil. We are so grateful to Canadian Solar for everything they have done for us.”

According to Canadian Solar Solutions, a subsidiary of Canadian Solar, the new donated solar system allows the off-grid OrcaLab to cut gas generator use and fuel costs dramatically, increase battery performance and life, expand the range of microphones and cameras, and improve amenities for summer volunteers. The system is designed to perform with minimal maintenance for several decades. In addition, the panels will power the main OrcaLab site, and a network of underwater microphones and cameras which will track migrating orca whale and other marine animals.

“We are honored to be involved in the ground breaking OrcaLab foundation’s noble orca whale research,” said Shawn Qu, chairman and CEO of Canadian Solar. “We are proud to be able to help advance the team’s ambitious work through this latest exciting application of solar energy. As an industry leader, Canadian Solar strives to also lead in our philanthropic efforts with organizations around the world.”

Methes Energies Canada, a subsidiary of Methes Engeries International, has signed a Purchase and Cooperation Agreement with BioFuel Aruba of Oranjestad, Aruba to purchase one Denami 600 biodiesel processor. The agreement was signed during the “Europe Meets the Americas” business conference in Aruba earlier this month.

Mr. Abe Dyck a cofounder and shareholder of Methes Energies was in Aruba for the ceremonial signing of the agreement. “I believe the signing of this agreement accomplishes the objective Aruba has of becoming a Green Gateway for companies wanting to deploy their technologies in the region. I see this as the start of a great relationship. I have enjoyed working with Gregory and the staff at Arina (Aruba Investment Agency) and look forward to commissioning the first 600 later this year.”

BioFuel Aruba was the first and is the only biodiesel producer in the country. The company will work with Methes to expand its biodiesel capacity. In addition, BioFuel Aruba has entered into pilot agreements with the Aruba Airports Authority and the public transit company, Arubus BV, to implement a biodiesel blend into their fleets. The two companies will also be working with the Government of Aruba to develop a biofuels mandate to be incorporated into their national energy policy.

“We can’t wait for our first Denami 600 to be delivered. With two pilot projects soon to start with Arubus and the Airport, we are looking forward to a greater demand for biodiesel. Methes’ technology is a great fit and will allow us to add more Denami’s as the demand increases even more here in Aruba and in the surrounding islands,” said BioFuel Aruba President, Gregory Fung.

As the Senate and House Agriculture Committees begin to mark up a new farm bill this week, big changes are expected in the next farm bill when it comes to farm programs and ethanol is helping to make that happen.

At the annual National Association of Farm Broadcasting Washington Watch issues forum on Monday, Renewable Fuels Association president and CEO Bob Dinneen said the dramatic changes in farm programs expected are actually being made possible by the increased use of biofuels that has taken place under the Renewable Fuel Standard (RFS). “It used to be that the price of corn was far less than the cost of production and it was government farm programs that would make up the difference,” said Dinneen. “And one of the things that Congress intended with the value-added ethanol industry was creating a value for farmers that would allow them to reduce farm program costs and it has done exactly that.”

Dinneen said the Senate farm bill proposal, which is being marked up this morning in committee, does include an energy title, the farm bill is not a real focus for them but they do hope that the farm bill will include funds for USDA to support blender pump installation and the development of advanced biofuels.

Soybean growers are getting more for their beans because of biodiesel, but consumers aren’t being pinched by higher food prices at the grocery stores. According to the United Soybean Board, a new study done for soybean checkoffs in Minnesota, Nebraska and the Dakotas show that biodiesel production has pushed U.S. soy oil prices higher than they were before the green fuel, increasing soy-oil revenues by $15 billion between 2006 and 2012 while pushing up the price of a bushel of soybeans by $0.74 a bushel:

It appears that biodiesel demand also helped offset the effects of a drop in food applications.

“When trans-fat labeling decreased the use of soy oil for food applications, specifically cooking oils, it created a huge drag on the soy-oil price due to surplus,” said Lewis Bainbridge, United Soybean Board (USB) secretary and a soybean farmer from Ethan, S.D. “We generated a huge stockpile, and that’s when the demand for biodiesel started, which helped decrease the glut of soy oil.”

Meanwhile, all those soybeans processed for biodiesel production are also being turned into more soy meal, lowering the cost of feed poultry and livestock farmers. The study says biodiesel production lowers soy meal prices by as much as $25 per ton.

The University of Wyoming has signed a deal that gets it into the algal biomass industry. The school agreed to give PlanktOMICS Algae Bioservices, run by a pair of university researchers, space and support to research how to develop patent-pending processes in exchange for a cut of the profits down the road:

PlanktOMICS principal partners Stephen Herbert, a UW professor of plant sciences, and Levi Lowder, a UW doctoral candidate in molecular and cellular life sciences, will focus on serving small companies that need to solve problems relative to their algae needs.

“Our services are tailored to companies that want to outsource their biological studies or biological research,” adds Lowder, who is PlanktOMICS’ chief technology officer. “We don’t really produce the end products. We do the biology. You have to know how to grow algae. That’s where we come in, to figure out how to farm algae on a large scale (for other companies).”

PlanktOMICS is working on technologies to control unwanted algae and other microbes in algae ponds, just like corn and soybean farmers control weeds, as well as technology to lower the cost of harvesting of algal biomass, among others. Last year, Lowder’s team won the university’s John P. Ellbogen $30K Entrepreneurship Competition, getting $12,500 and one year of free rent to further develop the company at the Wyoming Technology Business Center (WTBC), a business incubator at the school. Herbert and Lowder say they already have two clients lined up, one in the algal nutritional supplement business for more than 30 years. The developments could ultimately lead to algae-biodiesel projects.

The U.S. Department of Energy has announced six regional winners of its National Clean Energy Business Plan Competition. The competition is for university teams across the country to create new businesses and commercialize promising energy technologies developed at U.S. universities and the National Laboratories. Regional finalists include: Northwestern University, North Carolina A&T University, Purdue University, Brigham Young University, University of Arkansas, and University of California-Berkeley. The teams will compete in the national competition in Washington, D.C., on June 11th and 12th, 2013.

“The National Clean Energy Business Plan Competition allows the best and brightest to use their entrepreneurial skills to tackle the energy challenges our Nation continues to face,” said Acting Energy Secretary Daniel Poneman. “These innovative business strategies can expand the use of clean energy technologies and compete on a global market.”

According to DOE, the national competition aims to promote entrepreneurship in clean energy technologies that will boost American competitiveness, bring cutting-edge clean energy solutions to the market, and strengthen economic prosperity. Six regional organizations have received a total of $2 million over three years to host the competitions, including $100,000 in annual prizes for each regional competition’s winning team. At the National Competition, regional finalists will compete for cash prizes, and unique technical, design, public relations, and legal assistance to help commercialize their technology.

In the wake of a bill passed by the Florida Legislation to repeal a law calling for the use of 10% ethanol blends in the state, automotive technician and talk show host Bobby Likis had an op-ed in the Pensacola News Journal over the weekend calling on the governor to veto the bill.

“What could be more devastating than ditching 35 years of progress? If the Renewable Fuel Standard (RFS) is repealed, we will haplessly relinquish the fast track to the future while fellow states and countries worldwide embrace strategic biofuels production and use,” wrote Likis.

Who among us foolishly says, “We don’t care about what ‘they’ are doing. We care about Florida?” Well, we’d better care. Because of “them,” more efficient, better-mpg engines, cleaner air, national security and lots of dollars — in Florida — are at stake.

Governor Scott, now is the time for one good man to come to the aid of his state—by vetoing HB4001/SB320.

Florida’s Renewable Fuel Standard Act, which requires that all gasoline sold in Florida contain 9-10 percent ethanol, or other alternative fuel, by volume has been in effect for five years. The legislature passed a bill to repeal the act last month but it has not yet been signed by the governor.

Looks like the discussions are going to kick off right at the upcoming International Fuel Ethanol Workshop & Expo (FEW), June 10-13, 2013, in St. Louis, Mo. One of the first sessions will be the Association Roundtable: Mid-Year U.S. Ethanol Policy Update, featuring moderator Tom Bryan, President, BBI International; Bob Dinneen, President & CEO, Renewable Fuels Association; Tom Buis, CEO, Growth Energy; and Brian Jennings, Executive Vice President, American Coalition for Ethanol, set for Tuesday, June 11 at 9 am:

Join the top executive officers of the Renewable Fuels Association, Growth Energy and the American Coalition for Ethanol for a vital summer policy update on safeguarding RFS2, correcting misinformation about RINs, building the market for E15 and mid-level blends and maintaining our national commitment to commercializing advanced and cellulosic ethanol.

Still plenty of time to make your reservation for the event. Click here for more information.

The Renewable Fuels Association (RFA) today announced that Dawn Schueller Moore has joined the staff as Communications Director. Moore served as Press Secretary to U.S. Senator Herb Kohl of Wisconsin for nearly three years and has publicized issues and events ranging from agriculture, rural development, Supreme Court Justices Sotomayor and Kagan’s nomination hearings and Senator Kohl’s “No Oil Producing & Exporting Cartels Act” antitrust legislation to help decrease the cost of gasoline.

“I’ve seen firsthand the positive impact ethanol has had in my home state and I know all too well the fight that ethanol has ahead of it in Congress as oil interests bear down to desperately protect their monopoly,” Moore said. “I’m anxious to put my press and social media skills to work telling the amazing story of this industry and the Renewable Fuel Standard.”

“Dawn is a great addition to our team. With her Midwestern roots and Washington political experience, she has rural America in her blood and politically savvy instincts,” said RFA CEO Bob Dinneen. “Besides her valuable Senate experience, she is high energy and enthusiastic about the value-proposition that U.S. ethanol brings to agriculture, economic development, and our country as a stronger, more energy independent nation.”

Moore rounds out RFA’s communications team led by Christina Martin, Executive Vice President. Moore will be the point person for day-to-day press activities including media inquiries, interviews, and press conferences. She will be actively participating in social media. Look for Dawn Moore on Twitter at @RFADawn.

It’s time for National Association of Farm Broadcasting members to gather in Washington, DC for their annual Washington Watch program.

Activities this afternoon with the Issues Forum, sponsored by the Renewable Fuels Association. Among the topics sure to be discussed will be what a new farm bill may hold for renewable energy and the latest on attacks to the Renewable Fuel Standard (RFS).

Tomorrow morning the farm broadcasters meet up at USDA and will be speaking with a number of department heads including Secretary of Agriculture Tom Vilsack. It looks like Wednesday morning will be all about the Farm Bill with input from various members of the Senate and House where their versions of the new legislation are going through mark ups this week.

The Environmental Protection Agency’s (EPA) decision that makes aviation biofuel, better known as biojet, eligible for Renewable Identification Numbers (RINs) could make those green fuels viable for the aviation industry. This piece from Platts says the aviation industry could qualify for D4 biodiesel, D5 advanced biofuel or D7 cellulosic diesel RINs, despite jet fuel being exempt from RINs obligations.

“The availability of RINs is a critical bridge to commercial viability,” Nancy Young, vice president of environmental affairs for US airline trade group Airlines for America, said in a recent interview.

“What the RIN value does is it creates an incentive to buy and trade this fuel,” he said. “The whole reason we need the RFS is because we can show up with a cheaper better fuel, but it doesn’t necessarily get it into the marketplace because it’s so vertically integrated. RINs make sure the renewable fuel is used in an economically efficient way.”

The article goes on to say that the increasing costs of biodiesel RINs could end up causing trouble for biojet.

The Dynamic Fuels renewable diesel plant in Geismar, La., idled late last year, soon could be reopened. Biomass Magazine reports that Syntroleum, which has the animal fat and yellow grease renewable diesel plant as a joint venture with Tyson Foods, expects to start up operations once again this summer:

During the call, Gary Roth, president and CEO of Syntroleum, said the company ordered a new catalyst for the plant in February. It is scheduled to for delivery in late June. According to Roth, the new catalyst is expected to increase yields from an average of 80 percent to an average of 88 percent. As a result of the new catalyst, Roth said revenues per gallon would be expected increase from $4.09 to $4.55 per gallon, which would result in a $13 million revenue increase.

Rather than interrupting the feedstock chain of the plant while it is operating, Roth said the company believes it will be better to defer operations until the new catalyst is installed.

Syntroleum officials say the expected stability in D4 biomass-based diesel Renewable Identification Numbers (RINs) through this year and 2014 should help the company’s bottom line. The retroactive reinstatement of the biodiesel tax credit also helped profit margins to make the plant viable once again.

GE will be rolling out a new wind turbine for a wind farm in Michigan. This company news release says GE will supply 59 of the 1.7-100 brilliant wind turbine, the world’s most efficient wind turbine in its class, for the NextEra Energy Resources, LLC’s wind farm in the thumb region of Michigan.

The 1.7-100 machine is the second brilliant wind turbine in GE’s portfolio. GE’s brilliant wind turbines harness the power of the Industrial Internet to analyze tens of thousands of data points every second, helping to manage wind’s variability and provide smooth, predictable power. In addition to the brilliant features, GE’s new 1.7-100 meter wind turbine advances its 1.6-100 wind turbine series by utilizing electrical system upgrades to allow higher energy productions.

“GE is a trusted partner and a leader in wind turbine technology and innovation. Wind turbine innovation is key to the continued growth of the wind industry and we look forward to installing this new 1.7-megawatt technology machine,” said Armando Pimentel, president and CEO of NextEra Energy Resources.

The turbine’s blades will measure 100 meters in height. GE says the turbines are its highest capacity ones and the flagship products in its portfolio.

Legislation has been re-introduced in Congress that would give investors in renewable energy projects access to a corporate structure currently only available for fossil fuel-based energy projects.

The Master Limited Partnerships (MLP) Parity Act modifies the federal tax code by helping additional energy-generation and renewable fuels companies form master limited partnerships, which combine the funding advantages of corporations and the tax advantages of partnerships.

“The bipartisan Master Limited Partnerships Parity Act levels the playing field to help clean and renewable energy projects compete fairly with traditional energy projects,” said bill co-sponsor Senator Chris Coons (D-Del.), a member of the Senate Energy and Natural Resources Committee. “This market-driven solution supports the all-of-the-above energy strategy we need to power our country for generations to come.”

In addition to Coons, the Senate bill is co-sponsored by Senators Jerry Moran (R-Kan.), Debbie Stabenow (D-Mich.) and Lisa Murkowski (R-Alaska). The MLP Parity Act was also introduced in the House on Wednesday by Reps. Ted Poe (R-TX-02), Mike Thompson (D-CA-05), Peter Welch (D-VT-AL) and Chris Gibson (R-NY-19).

According to FaegreBD Consulting, an MLP is a publicly traded partnership that is largely measured by the predictability and sustainability of its cash flow. As a partnership, the MLP is not subject to taxation at the MLP or corporate level, but instead is taxed as a pass-through entity. As such, MLP cash flows are enhanced, and tax savings from this single level of taxation contribute to a cost of capital advantage over competitors organized or taxed as a corporation. In the late 1980’s, legislation was passed restricting the use of MLPs to the energy and natural resource industry, excluding renewable sources of energy. As a result, MLPs have been largely limited to the ownership and operation of midstream oil and gas assets such as pipelines and storage terminals, and more recently the exploration and production of oil, gas and coal.