2015 Energy Industry Update Released

ScottMadden Energy Industry UpdateThe 2015 edition of The Energy Industry Update has been released by ScottMadden, an energy consulting firm. The report points out as market changes, regulatory processes, and technology evolution unfold, energy and utility companies will face them and adapt. Themed “Changes: Turn and Face the Strange,” this issue surveys a broad array of strategic issues, including:

  • Insights drawn from a first-hand look at developments and lessons learned in Germany. The Solar Energy Power Association and ScottMadden recently partnered to lead a fact-finding mission to uncover the story behind the headlines;
  • A review of the U.S. Environmental Protection Agency’s proposed Clean Power Plan designed to reduce greenhouse gas emissions from existing power plants. The report examines its timeline, implications, and issues in the wake of ongoing political and regulatory activity and a groundswell of comments from all sides; and
  • A view of how utilities are looking with interest at electric vehicles, hoping to increase energy sales and burnish their brands. The report examines customer and vehicle characteristics and some generic business models being tested in this growing market.
  • A review of natural gas prices and gas production from shale formations. The report considers the latest dynamics in this market, including what (if any) impact low oil on which prices are having.

“For months, indeed years, we have been anticipating major changes in the industry from a number of factors—low natural gas prices, technology advancement, and profound regulatory changes,” said Greg Litra, partner and energy, clean tech, and sustainability research lead at ScottMadden. “After being in the distance, they are now on the doorstep, and energy and utility companies are responding to these changes by testing new business models and adapting to or embracing new technologies.”

Report: Offshore Wind Policy Not Working

According to a new report fueled by concerns that the Cape Wind project may never see fruition, U.S. offshore wind policy is not working. “In Up in the Air: What the Northeast States Should Do Together on Offshore Wind, Before It’s Too Late,” published by Clean Energy Group (CEG) and Navigant Consulting, tells the story of how the Cape Wind project is struggling against a decade of opposition. The report concludes the project’s difficulties highlight a larger policy problem—it is almost impossible for a single state to jump start the entire U.S. offshore wind industry.

Up in the AirThe report recommends a multi-state collaboration among states to create stronger and consistent regional policies, financing actions and permitting across the Northeast states.

“Cape Wind was a battle of the wallets, and the fossil fuel wallet evidently won,” said Lewis Milford, president of Clean Energy Group and the lead author of the report. “But there is a larger and more important story behind this controversy. If Northeast states want to reduce the costs of these projects and create offshore wind jobs, they must develop clear and consistent policies across the region, to give developers good reason to build projects here. If they don’t act together soon, they will lose this clean energy resource for decades to come, which will be bad for the economy and the environment.”

The paper recommends the states consider seven multi-state policy areas for regional action.

  1. Regional Offshore Wind Target. The establishment of a practical regional target (or target range) for offshore wind capacity would produce meaningful economic development and environmental benefits by creating a clear demand signal to developers.
  2. Coordinated Policy Incentives. Individual state policy drivers, including any incentives for developers, should be consistent across the region to drive demand and produce cost reductions over time through scale up of the offshore wind resource.
  3. Financing. States should develop new, regional financing mechanisms for regional and single projects, including use of bonds and green bank financing.
  4. Procurement. States should jointly procure power from one or more large offshore wind projects to reduce costs and create a reliable pipeline of demand for project developers.
  5. Economic Development. Coordinated, multi-state, economic development strategies rather than purely competitive action would spur economic development activity in the region through the creation of clean energy jobs and potentially new manufacturing facilities.
  6. Transmission. States should develop joint public funding of regional transmission and interconnection facilities associated with regional projects.
  7. Permitting. It is essential to the success of the multi-state projects that the policies ultimately adopted for permitting these facilities be standardized.

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BioEnergy Bytes

  • http://domesticfuel.com/category/bioenergy-bytes/Mainstream Renewable Power has announced the launch of a pan-African renewable energy generation platform, Lekela Power, that it has formed along with Actis, a global pan-emerging market private equity firm. Lekela Power will provide between 700 and 900 megawatts of wind and solar power across Africa by 2018.
  • Vaisala is providing measurement systems and services to Finnish wind power company, Puhuri Oy, which operates three wind projects and is developing several more in Finland. The agreement includes two Vaisala Triton Sonic Wind Profilers that will be installed in northern Finland, as well as an annual SkyServe maintenance and data management contract. Furthermore, Vaisala will deliver the planning and wind resource evaluation services as part of the measurement campaign to help Puhuri better assess the performance potential of its proposed wind farms.
  • SunEdison, Inc. has announced the completion of a 677 kilowatt ground-mount solar photovoltaic (PV) system that will provide energy for the AT&T materials distribution facility in Lancaster, Texas. The system is constructed using 2,000 high-efficiency SunEdison solar panels. SunEdison is also working with TerraForm Power on this project.
  • Vivint Solar has announced that it has extended job offers to all 20 graduates of the United States Department of Energy’s ‘Reach for the Sun’ pilot program at United States Marine Corps Base Camp Pendleton. ‘Reach for the Sun’ is an intensive solar workforce training designed to help place qualified transitioning military service members into the solar industry. ‘Reach for the Sun’ pilot program was offered to 20 transitioning Marines and included 4 weeks of intensive photovoltaic coursework. Each graduate gains the skills to size and install solar panels, safely connect electricity to the grid, interpret and comply with local building code requirements. Additional pilot courses will be offered at United States Army Fort Carson in Colorado and Naval Station Norfolk in Virginia this year.

USGC Helped Move DDGS Exports in 2014

usgc-winter-grayThe U.S. Grains Council (USGC) held its winter meeting last week in Costa Rica where more than 250 delegates met to take a look back at last year and assess export opportunities.

Chairman Ron Gray says one of big issues of 2014 was with the ethanol co-product distillers grains (DDGS) and China. “At the end of the year, our exports were one of the highest years for DDGS on record,” said Gray. “The Grains Council was instrumental in mitigating that process so that trade can continue.”

Gray, who is a farmer from Illinois, believes it’s important for producers to be involved in trade policy. “I think combines would be easier to fix than trade policy,” he said. “We try to address the next problem so we can keep trade moving.”

Gray says U.S. sorghum picked up some exports to China last year to pick up the slack caused by the biotech trait issue with corn, which allowed them to remain active in the market, but ultimately it’s the growing demand for corn that is benefiting farmers back home.

USDA Secretary Returns to Commodity Classic

classic14-vilsack-stageU.S. Secretary of Agriculture Tom Vilsack will visit the Commodity Classic next week for the sixth year in a row to address the annual convention and trade show for corn, soybean, wheat and sorghum growers. The secretary will deliver a keynote address to several thousand farmers and ag allies during the event’s General Session on Friday, Feb. 27, in Phoenix, Arizona.

“We’re thrilled to be welcoming Secretary Vilsack back to Commodity Classic,” said National Corn Growers Association President Chip Bowling. “With so much going on in our nation’s capital that impact their lives, the audience will be eager to get his report on the top issues facing our growers, such as trade and the farm bill. He always provides an experienced, deep-inside-Washington perspective.”

The 20th annual Commodity Classic takes place Feb. 26-28, 2015, at the Phoenix Convention Center.

The Andersons Grain Group Head to Retire

Dennis Addis (left) and Neill McKinstray

Dennis Addis (left) and Neill McKinstray

The Andersons, Inc. Grain Group President Denny Addis has announced plans to retire in May. According to the company, Ethanol Group president Neill C. McKinstray will assume leadership over both groups at that time.

“Denny has a stellar 43-year record with The Andersons and during his tenure has exhibited faithful service and exceptional leadership,” says Hal Reed, Chief Operating Officer.

Addis began his career with the company in 1971 bagging fertilizer and loading trucks as a part-time employee while a student at the University of Toledo. He spent all but three of his 43 years in the Plant Nutrient Group, ultimately serving as the group’s president for 11 years. He has served as the president of the Grain Group since 2012.

McKinstray is a 39-year veteran with The Andersons, including more than 30 years working at increasing levels of responsibility in the Grain Group. In 2011 he was named as President of the newly-formed Ethanol Group, which he has led with great success.

Montana Group Turning Waste into Biodiesel

fullcirclebiofuelsA group from Montana is turning waste into biodiesel. This story from KBZK-TV in Bozeman says Full Circle Biofuels in that city is making the used cooking grease from restaurants into the green fuel.

“Restaurants will have this and they will dump their used fryer oil into here. And then we’ll come and pump it out of this little hole on top whenever they’re full,” Full Circle Biofuels director Jesse Therien said.

Therien turns that waste into something people can use: biodiesel. It’s an alternative to petroleum-based diesel, with some added benefits like reduced emissions.

“It’s biodegradable, it’s nontoxic, it’s renewable and ours in particular is made from recycled materials,” Therein said.

Therien collects used fryer oil from more than 60 restaurants in Bozeman and Belgrade. “Right now we’re bringing in about 4,000 gallons a month but that is likely to double in the next little while. We have all the Walmarts in the state and then Cody, Wyoming as well,” he said.

The company says a school district and the city there have approached it to make biodiesel to go into buses and snow plows.

Golden Grain Marks Billion Gallons of Ethanol

Golden Grain Energy in Mason City, Iowa is celebrating the production of its one billionth gallon of ethanol this month.

gge-billion-shirts“This is a huge occasion for the plant, the staff, and the community as a whole,” said Chad Kuhlers, Chief Operations Officer of Golden Grain Energy. “I believe we are the first single location ethanol plant in the country to reach this production mark and it couldn’t have been done without the support from the shareholders, community and the great work from our employees over the years.”

The ethanol plant, which started production in December 2004, celebrated the milestone on Monday during its annual meeting with special guests including Iowa Secretary of Agriculture Bill Northey and Senator Chuck Grassley (R-IA). Plant employees wore special t-shirts to note the special occasion.

gge-grassley“This achievement represents a lot of work from farmer to producer to truck driver. Each stage of production leads to a tremendously beneficial final product,” said Sen. Grassley.

“This remarkable milestone by Golden Grain Energy is a great opportunity to celebrate the tremendous impact this plant and the 42 other ethanol refineries have had in reducing our dependence on foreign oil, protecting our environment and boosting the Iowa economy,” added Northey.

That billion gallons of ethanol represents over 351 million bushels of corn and a nice boost for the local economy, according to American Coalition for Ethanol Executive Vice President Brian Jennings. “Golden Grain Energy has … paid out more than $2 billion dollars to corn farmers, suppliers and service providers, and employees, and returned nearly $137 million dollars to its investors,” said Jennings in a congratulatory statement.

Renewable Fuels Association (RFA) President and CEO Bob Dinneen was on hand at the company’s groundbreaking ceremony in 2003. “It has been a privilege to watch the company grow and thrive and I can’t wait to see where they will take it from here,” said Dinneen.

Golden Grain Energy has a nameplate capacity of 115 million gallons per year.

Murphy USA E15 Expansion Brings Call for Law

beale1The announcement by Murphy USA to offer a 15 percent blend of ethanol, E15, at more locations in Chicago is prompting a city councilman calling for an ordinance to support renewable fuel efforts in the city. Alderman Anthony Beale has been working for some time now to get an E15 ordinance on the book.

“While I welcome E15 to our region, it pains me that due to our 7-month process of debate, Chicago retailers have not had the ability to offer E15 first and therefore to more ably compete with suburban sellers. This news, as welcome as it is, underscores the need to make sure the market is similarly open to retailers in the city, where Big Oil currently has the ability to block this choice of fuels from the market.

“As a national distributor and retailer, Murphy USA can offer whatever products they like. Chicago retailers, on the other hand, are at the mercy of the Big Oil companies, who as we have seen through the thousands of dollars they’ve spent on ads, will go to any lengths to keep drivers dependent on fossil fuel, whatever the consequences for the health of our air and residents.

“It’s time to end the monopoly and stranglehold of the oil companies – who keep us dependent on foreign oil and give us high prices and petcoke in return. It’s time – for the good of Chicago’s air, for the good of Chicago’s health, for the good of Chicago’s beleaguered filling-station owners – to pass the Clean the Air with E15 ordinance.”

Beale’s ordinance has enjoys some pretty widespread support, including backers from the American Council on Renewable Energy, American Lung Association in Illinois, Chicago gas station owner Luke Casson, as well as several other biofuel, agribusiness and environmental groups.

Biodiesel’s Role in Meeting California’s AB 32 Goals

calbiodieselallianceBiodiesel is playing a critical role in helping California meet its goals under the state’s clean air legislation, known as AB 32. The California Biodiesel Alliance says that during the recent Fourth Annual California Biodiesel Conference, attendees heard from a variety of speakers who talked about how the green fuel is making a difference.

Don Scott, Director of Sustainability at the National Biodiesel Board, kicked off the first panel with several important statistics about biodiesel benefits relative to petroleum diesel: biodiesel reduces GHGs by 50 – 80%; decreases wastewater by 79% and hazardous waste by 96%; and its use prevents hundreds of premature deaths in California from reduced PM2.5 exposure. Making the same comparison with petroleum diesel, panel moderator Lisa Mortenson, Co-Founder and CEO of Community Fuels, presented U.S. EPA data on biodiesel’s health benefits showing significant reductions in emissions associated with smog, cancer causing compounds, and respiratory illness, and made an insightful observation: “Imagine if . . . biodiesel were the standard and petroleum diesel were trying to gain approval.”

High-level California regulatory officials presented at the conference. Richard Corey, Executive Officer of the California Air Resources Board (ARB), reported on progress toward the adoption California’s groundbreaking carbon reduction strategies by other states and Canada. Adding to ARB’s well-known acknowledgement of the value of biodiesel’s GHG-lowering emissions profile (biodiesel generated 13% of LCFS credits through Q3 2014), Mr. Corey referenced the state’s reliance on biodiesel for “future reductions of toxic diesel particulate matter.”

Janea A. Scott, Commissioner at the California Energy Commission (CEC), gave an update on funding under the agency’s Alternative and Renewable Fuel and Vehicle Technology Program, citing that biodiesel is making tremendous gains and showcasing four biodiesel production projects with construction or expansion underway using agency grants.

The principal consultant for AB 32 author Senator Fran Pavley, Henry Stern, encouraged industry participants to keep coming back to tell positive biodiesel stories.

ICM to Increase Efficiency of Nebraska Ethanol Plant

icm_logo1ICM, Inc. is partnering with E Energy Adams LLC to upgrade a Nebraska ethanol plant. This news release from ICM says the company’s patent-pending Selective Milling Technology (SMT) and patent-pending Fiber Separation Technology (FST) will allow E Energy Adams to increase throughput, decrease cost per gallon, and create the ability to produce high-value streams from their traditional DGS, all while increasing ethanol yield and increasing distiller’s corn oil recovery.

David VanderGriend, CEO for ICM, Inc., said, “ICM is pleased to partner with E Energy Adams as they fully adopt the next-generation “biorefinery” concept, allowing them to accomplish their mission of supporting the local economy while delivering profits to their investor owners, area grain producers, and livestock producers. E Energy is a leader in the ethanol industry, and we are proud to support them in their vision for continually improving operations and profitability.

Carl Sitzmann, CEO for E Energy Adams LLC, said, “We’ve been focused on the development of this project for the last two years, and we are pleased to be partnering with ICM. Their 20 years of experience in the ethanol industry, world-class research and development, and long-term vision of the future are perfect complements to our strategic vision involving competitiveness and new technologies. This project will not only give us the low-cost, energy-efficient base that we need to be an efficient producer, but also provide a platform for future development of cellulosic ethanol and differentiated co-products.”

ICM’s SMT™ is the industry leader in ‘fine grind’ technology, with 20 current or pending installations, representing over 1.4 billion gallons of annual ethanol production. FST is the next step in ICM’s EPA-approved pathway to cellulosic ethanol. It separates the corn kernel fiber for use in generating products with higher margin opportunities, or further processing it (using pre-treatment provided as a separate option by ICM) to produce cellulosic ethanol in an existing plant.

PG&E Proposes Largest Cali EV Charging Network

Pacific Gas and Electric Company (PG&E) has asked California state regulators for approval to build out a 25,000 electric vehicle (EV) network throughout Central and Northern California. If approved, PG&E said this program will be the largest deployment of EV charging stations in the country.

The chargers would be located at commercial and public locations, including multi-family dwellings, retail centers and business parking lots. Approximately 10 percent of the chargers would be installed to support disadvantaged communities. PG&E would also provide tools and educational materials for site hosts and customers to learn about the benefits of EVs.

PG&E Electric Vehicle“Our proposed build-out of EV charging infrastructure aims to accelerate customer adoption of clean, quiet, and efficient plug-in vehicles by reducing lingering range anxiety. It reflects our commitment to helping the state of California meet its critical clean air and greenhouse gas emissions reduction goals by promoting cleaner transportation,” said Tony Earley, chairman, president, and CEO of PG&E Corporation.

He continued, “By supporting market acceptance of electric vehicles, it should create tremendous new opportunities for other infrastructure and technology companies, help keep California in the forefront of EV innovation, and create new jobs in local communities across Northern and Central California.”

More than 60,000 plug-in electric vehicles are currently registered in PG&E’s service area, which represents more than a fifth of all EVs in the U.S. The Governor’s Office has called for 1.5 million zero-emission vehicles in California by 2025 to help meet the state’s ambitious goal of reducing greenhouse gas emissions 80 percent below 1990 levels by 2050. To support that plan, industry models suggest that PG&E’s service area will need about 100,000 Level 2 chargers in public locations by 2020.

All of the 25,000 stations PG&E proposes to build would have Level 2 chargers, which provide up to 25 miles of range for every hour of charging. To support travel between metropolitan areas, PG&E would also install at key locations 100 DC fast chargers, which can recharge an EV’s battery in only 30 minutes.

First Solar, Apple Strike Bright Power Deal

A bright power deal was struck this week when Apple committed $848 million to purchase clean energy from First Solar’s California Flats Solar Project in Monterey County, Calif. Apple will receive electricity from 130 MW AC of the solar project under a 25-year power First Solar logopurchase agreement (PPA), the largest agreement in the industry to provide clean energy to a commercial end user according to First Solar.

“Apple is leading the way in addressing climate change by showing how large companies can serve their operations with 100 percent clean, renewable energy,” said Joe Kishkill, chief commercial officer for First Solar. “Apple’s commitment was instrumental in making this project possible and will significantly increase the supply of solar power in California. Over time, the renewable energy from California Flats will provide cost savings over alternative sources of energy as well as substantially lower environmental impact.”

Construction of the 2,900-acre California Flats Solar Project is expected to begin in mid-2015 and to be completed by the end of 2016. The output of the remaining 150 MW of the project will be sold to Pacific Gas & Electric under a separate long-term PPA, and the project is fully subscribed between the Apple and PG&E PPAs.

Calgren Ethanol Biodigester Off and Digesting

The Calgren Ethanol Biodigester is off and digesting waste from dairy farms into ethanol. The ethanol will be used by consumers in California’s Central Valley. The Two-Stage Mixed Plug Flow Digester was designed by DVO, Inc. and built by Regenis. The partners said it is the first California digester to use agricultural waste to create renewable natural gas to power another renewable energy facility, creating a step forward in a virtuous, zero waste lifecycle.

gI_59645_Pixley facility photoThe process begins with local dairy, Four J Farms, sending their cow waste to the Calgren digester, which captures methane and burns it as clean biogas. While Calgren will be utilizing the renewable gas to power its facility, the digester will also greatly reduce bacteria and pathogens so dairy farmers can reuse the liquids (water) safely on their crops.

“I am proud of the contribution that Calgren can make to this incredibly green, low-carbon intensity project,” said Lyle Schlyer, president of Calgren Renewable Fuels. “Digesters are often talked about, but actually building one and getting it into operation doesn’t happen all that often. This is a marriage of industrial and dairy interests.”

The California Energy Commission (CEC) invested $4.6 million in the project. In January 2015, CEC issued rules that could increase the number of digester projects around the state. Today California imports over 90 percent of its natural gas and in 2013 the state constructed nearly half of all the new natural gas-fired power plants built in the U.S. The need to import the energy is fueling the state’s commitment to supporting locally produced alternative forms of power.

“The San Joaquin Valley is challenged with some of country’s worst air pollution,” noted Janea A. Scott, Commissioner at the CEC. “The Pixley Biogas anaerobic digester is the first anaerobic digester on a California farm permitted to use all feedstocks, including municipal green waste and food processing waste. This type of innovative technology helps California meet its clean air, petroleum reduction, and climate goals.”

Nopetro to Roll Out CNG in Florida

The Central Florida Regional Transportation Authority (LYNX) has awarded Nopetro a contract to build and operate a compressed natural gas (CNG) fueling stations, provide improvements to its maintenance facility and convert the public but fleet to CNG. In addition to fueling LYNX’s bus fleet, Nopetro’s station will also be available to serve private commercial fleets and the public at large.

“Once again, LYNX is at the forefront of the nationwide movement to build sustainable public transportation systems,” said John M. Lewis Jr., CEO of LYNX. “Switching to CNG makes sense both financially and environmentally for Central Florida transit, and Nopetro’s collaboration made an easy choice even easier.”

NoPetro-CNG Fueling StationLYNX has estimated that converting their city buses from diesel to CNG will achieve a return of investment in three years. The fleets are expected to be converted by the second half of 2015. The plan is for LYNX to purchase and/or lease an initial 35 CNG buses and to have more than 150 CNG buses in their fleet within the next five years.

“This partnership will positively impact the 30 million riders who utilize LYNX public transportation services each year, as they travel throughout Orange, Seminole and Osceola counties,” said Orange County Mayor Teresa Jacobs, Chair of the LYNX Board of Directors. “Converting our buses to run on CNG is part of our continuing efforts to improve operations through innovative technologies.”

Nopetro cites converting to CNG offers more than financial savings to local government agencies. Experts note that switching to CNG cuts emissions drastically, including particulate matter by 89 percent, carbon monoxide by 70 percent, carbon dioxide by 25 percent and nitrous oxide by 80 percent.

Jorge Herrera, co-founder and CEO of Nopetro, concluded, “We are proud to work with LYNX and look forward to helping the agency continue to offer affordable public transportation services while creating a cleaner environment. The switch from diesel to CNG will spur significant savings and position LYNX ahead of the curve across the country.”