Archive for July, 2008

Ethanol Imports and the Caribbean Basin Initiative

Posted on July 31, 2008. Filed under: Field-to-Pump, Hydrous Ethanol | Tags: , , , , |

Ethanol Imports and the Caribbean Basin Initiative

(Source: CRS Report RS21930, Ethanol Imports and the Caribbean Basin Initiative,

by Brent D. Yacobucci, March 18, 2008)

 

 

Summary

Fuel ethanol consumption has grown significantly in the past several years, and it will continue to grow with the establishment of a renewable fuel standard (RFS) in the Energy Policy Act of 2005 (P.L. 109-58) and the expansion of that RFS in the Energy Independence and Security Act of 2007 (P.L. 110-140). This standard requires U.S. transportation fuels to contain a minimum amount of renewable fuel, including ethanol.

 

Most of the U.S. market is supplied by domestic refiners producing ethanol from American corn. However, imports play a small but growing role in the U.S. market. One reason for the relatively small role is a 2.5% ad valorem tariff and (more significantly) a 54-cent-per-gallon added duty on imported ethanol. These duties offset an economic incentive of 51 cents per gallon for the use of ethanol in gasoline.

 

However, to promote development and stability in the Caribbean region and Central America, the Caribbean Basin Initiative (CBI) allows the imports of most products, including ethanol, duty-free. While many of these products are produced in CBI countries, ethanol entering the United States under the CBI is generally produced elsewhere and reprocessed in CBI countries for export to the United States. The U.S.-Central America Free Trade Agreement (CAFTA) would maintain this duty-free treatment and set specific allocations for imports from Costa Rica and El Salvador.

 

Duty-free treatment of CBI ethanol has raised concerns, especially as the market for ethanol has the potential for dramatic expansion under P.L. 109-58 and P.L. 110-140. In the United States, fuel ethanol is largely domestically produced. A value-added product of agricultural commodities, mainly corn, it is used as a gasoline additive and as an alternative to gasoline. To promote its use, ethanol-blended gasoline is granted a significant tax incentive. However, this incentive does not recognize point of origin, and there is a duty on most imported fuel ethanol to offset the exemption. But a limited amount of ethanol may be imported under the Caribbean Basin Initiative (CBI) duty-free, even if most of the steps in the production process were completed in other countries. This duty-free import of ethanol has raised concerns, especially as U.S. demand for ethanol has been growing. Further, duty-free imports from these countries, especially Costa Rica and El Salvador, have played a role in the development of the U.S.-Central America Free Trade Agreement (CAFTA).

 

Fuel Ethanol

Ethanol is an alcohol fuel produced from the fermentation of simple sugars. Most ethanol in the United States is produced from corn. In other countries, sugarcane or other plants are common feedstocks. In the United States, the increased demand for corn leads to higher revenues for U.S. corn farmers. Ethanol is usually blended in gasoline (a mixture called “gasohol”) to increase octane, improve combustion, and extend gasoline stocks. Currently, about 3% to 5% of total U.S. gasoline demand is actually met by ethanol, and roughly half of U.S. gasoline contains some ethanol.

 

U.S. ethanol is generally produced and consumed in the Midwest, close to where the corn feedstock is produced. The main steps to ethanol production are as follows:

a. The feedstock (e.g., corn) is processed to separate fermentable sugars.

b. Yeast is added to ferment the sugars.

c. The resulting alcohol is distilled.

d. Finally, the distilled alcohol is dehydrated to remove any remaining water.

 

This final step — dehydration — is at the heart of the issue over ethanol imports from the CBI, as discussed below.

 

Ethanol Imports

According to the United States International Trade Commission, the majority of all fuel ethanol imports to the United States came through CBI countries between 1999 and 2003.  In 2004, imports from Brazil to the United States grew dramatically, but in 2005, CBI imports again represented more than half of all U.S. ethanol imports. With an increase in ethanol demand in 2006 due to voluntary elimination of MTBE — a competitor for ethanol in gasoline blending — imports grew dramatically, roughly quadrupling imports in any previous year. Most of this increase was in direct imports from Brazil. Historically, imports have played a relatively small role in the U.S. ethanol market. Total ethanol consumption in 2005 was approximately 3.9 billion gallons, whereas imports totaled 135 million gallons, or about 4%. Imports from the CBI totaled approximately 2.6%. In 2006, total imports represented roughly 13% of the 5.0 billion gallons consumed in 2006; ethanol from CBI countries represented roughly 3.4%. In 2007, total imports represented roughly 6% of U.S. consumption (6.8 billion gallons); ethanol from CBI countries represented roughly 3.6%.

 

One reason for limited imports — even though, in some cases, production costs for ethanol in foreign countries are significantly lower than in the United States — is a most-favored-nation tariff of 2.5% and an added duty of 54 cents per gallon. In many cases, this tariff negates lower production costs in other countries. For example, by some estimates, Brazilian production costs have been roughly 50% lower than in the United States. A key motivation for the establishment of the tariff was to offset a tax incentive for ethanol-blended gasoline (“gasohol”). This incentive is currently valued at 51 cents per gallon of pure ethanol used in blending. Unless imports enter the United States duty-free, the tariff effectively negates the incentive for those imports. With U.S. wholesale ethanol prices ranging from roughly $1.50 to $2.50 per gallon for most of the time between January 2006 to March 2008, the tariff has presented a significant barrier to imports. However, during the voluntary phase-out of MTBE, there was a significant spike in wholesale prices between April 2006 and September 2006, with wholesale prices nearing $6.00 per gallon in some markets during the summer of 2006. This run-up in prices significantly improved the profitability of importing ethanol, regardless of the duty.

 

Ethanol and the CBI

As Congress noted in the Customs and Trade Act of 1990, the Caribbean Basin Initiative (CBI) was established in 1983 to promote “a stable political and economic climate in the Caribbean region.” As part of the initiative, duty-free status is granted to a large array of products from beneficiary countries, including fuel ethanol under certain conditions. If produced from at least 50% local feedstocks (e.g., ethanol produced from sugarcane grown in the CBI beneficiary countries), ethanol may be imported duty-free. If the local feedstock content is lower, limitations apply on the quantity of duty-free ethanol. Nevertheless, up to 7% of the U.S. market may be supplied duty-free by CBI ethanol containing no local feedstock. In this case, hydrous (“wet”) ethanol produced in other countries, historically Brazil or European countries, can be shipped to a dehydration plant in a CBI country for reprocessing. After the ethanol is dehydrated, it is imported duty-free into the United States. Currently, imports of dehydrated ethanol under the CBI are far below the 7% cap (approximately 3% in 2006). For 2006, the cap was about 270 million gallons, whereas about 170 million gallons were imported under the CBI in that year.

 

Dehydration plants are currently operating in Jamaica, Costa Rica, El Salvador, Trinidad and Tobago, and the U.S. Virgin Islands.  Jamaica and Costa Rica were the two largest exporters of fuel ethanol to the United States from 1999 to 2003. (In 2004 and 2006, direct imports from Brazil exceeded imports from all other countries combined.) Despite criticisms in the United States, new dehydration facilities began production in Trinidad and Tobago in 2005 and the U.S. Virgin Islands in 2007.

 

Duty-free ethanol imports have also played a role in discussions regarding the U.S.-Central America Free Trade Agreement (CAFTA). Under this agreement signed by the Bush Administration and the participating countries, specific allocations (of the 7% duty-free cap for CBI ethanol) are set aside for Costa Rica and El Salvador. These allocations effectively limit the amount of fuel that other CBI countries can import duty-free. Costa Rica’s allocation is 31 million gallons per year, while El Salvador was granted an initial allocation of approximately 6.6 million gallons per year, increasing by roughly 1.3 million gallons in each subsequent year. However, El Salvador’s allocation may not exceed 10% of the total CBI allocation (or 0.7% of the U.S. market). The agreement was signed on May 28, 2004. Congress approved the agreement in 2005, and implementing legislation was signed by President Bush on August 2, 2005 (P.L. 109-53). As both countries exceeded their allocations in 2005, 2006, and 2007, the ultimate effects of the allocations is unclear.

 

Growing U.S. Ethanol Market

The U.S. ethanol market has grown dramatically over the past several years. Between 1990 and 2007, U.S. ethanol consumption increased from about 900 million gallons per year to 6.8 billion gallons per year. Much of this growth has resulted from Clean Air Act requirements that gasoline in areas with the worst ozone pollution contain an oxygenate, such as ethanol, and the establishment of a renewable fuel standard (RFS) in the Energy Policy Act of 2005 (P.L. 109-58). The RFS required that gasoline sold in the United States contain a renewable fuel, such as ethanol. The mandate required 4.0 billion gallons of renewable fuel in 2006, increasing to 7.5 billion gallons in 2012. The Energy Independence and Security Act of 2007 (P.L.110-140) expanded the RFS to 9.0 billion gallons in 2008, increasing to 36 billion gallons in 2022. In addition, the expanded RFS specifically requires the use of an increasing amount of “advanced biofuels” — biofuels produced from feedstocks other than corn starch (including sugar cane ethanol). While domestic producers anticipate greater demand for their product under the RFS, they are also concerned that duty-free ethanol imports through the CBI could dramatically increase, to their detriment.

 

Duty Drawback

In addition to the concerns over imports of duty-free ethanol from CBI countries, there is growing concern that a large portion of ethanol otherwise subject to the duties is being imported duty-free through a “manufacturing drawback.” If a manufacturer imports an intermediate product then exports the finished product or a similar product, that manufacturer may be eligible for a refund (drawback) of up to 99% of the duties paid. There are special provisions for the production of petroleum derivatives. In the case of fuel ethanol, the imported ethanol is used as a blending component in gasoline, and jet fuel (considered a like commodity) is exported to qualify for the drawback. Some critics estimate that as much as 75% or more of the duties were eligible for the drawback in 2006. Therefore, critics question the effectiveness of the ethanol duties and the CBI exemption.

 

Congressional Action

Some Members of Congress have expressed concern over duty-free imports of dehydrated ethanol that originates in Brazil or other countries. Therefore, there is growing interest from some Members of Congress to eliminate the CBI exemption and/or modify the manufacturing drawback for petroleum products. Although some stakeholders are concerned over increased ethanol imports and their effect on the U.S. industry, others believe that tariffs on imported ethanol should be eliminated entirely. They argue that increased use of ethanol, regardless of its origin, would further displace gasoline consumption. They also argue that inexpensive imported ethanol would help mitigate any fuel price increases from the renewable fuels standard.

 

Conclusion

With growing demand for ethanol, there is increased interest in foreign imports. Because ethanol from CBI countries is granted duty-free status, there is the possibility that imports of dehydrated ethanol will grow because of this avenue provided in the law. While CBI countries have not yet reached their quota for ethanol refined in other countries and dehydrated in the Caribbean, CBI imports have increased over the past few years, and may exceed the quota in future years. CBI imports have the potential to increase significantly over the next few years, especially as the domestic market grows under the renewable fuels standard. In addition, the manufacturing drawback could provide another avenue for duty-free ethanol imports directly from Brazil and other countries. Low-cost ethanol imports could have an advantage over domestically produced ethanol, which could affect the U.S. ethanol industry and American corn growers. However, the U.S. ethanol industry has grown significantly in the past several years, and will likely continue to grow regardless of the level of imports.

 

About Renergie

Renergie was formed by Ms. Meaghan M. Donovan on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita.  Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol.  Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program.  Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On  April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector.  On January 20, 2009, Florida Energy & Climate Commission amended RET Grant Agreement S0386 to increase Renergie’s funding from $1,500,483 to $2,500,000. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is renewable, more economical, cleaner, and more efficient than unleaded gasoline.  Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.

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Hydrous Ethanol Can be Effectively Used in Most Ethanol/Gasoline Blending Applications

Posted on July 29, 2008. Filed under: Field-to-Pump, Hydrous Ethanol | Tags: , , , , |

Ethanol fuel specifications traditionally dictate use of anhydrous ethanol (less than 1% water) for gasoline blending. This results in additional costs, energy usage and environmental impacts associated with the extra processing step required to dehydrate the hydrous ethanol (4-5% water) produced via distillation to meet the current anhydrous ethanol specifications. A recent study reveals for the first time what conventional wisdom has overlooked – namely that hydrous ethanol can be effectively used in most ethanol/gasoline blending applications, reducing or eliminating the need for anhydrous ethanol production and distribution.

 

The following article appeared in the May, 2008 issue of Ethanol Producer Magazine.

 

Testing the Water

 

Conventional wisdom says water in ethanol is bad, but a new technical understanding is emerging that could dramatically improve corn-based ethanol’s environmental footprint while revolutionizing how the alternative fuel is made, transported and used.

 

by Ron Kotrba

 

A lot of attention is being focused on midlevel ethanol blends. If that’s considered a hot topic then the issue of midlevel hydrous blends reaches the magnitude of a Super Nova. A convincing message is reaching influential ears in government and private industry, and it turns conventional wisdom on its head. The accepted truth is that water in ethanol is bad—period. As such, anhydrous “water-free” ethanol has been the norm in the United States since the blend component’s debut in gas supplies 25 years ago. Now enter a serendipitous, convincing find.

 

“This just happened last year—it’s very new,” says Frits Dautzenberg, a San Diego-based consultant. “How is it possible everyone missed this point?” Dautzenberg is retained as a consultant by the Netherlands-based Process Design Center Inc. What Dautzenberg is talking about is a new understanding of hydrous ethanol’s relationship to gas and ambient moisture.

 

This “new science” reveals midlevel hydrous ethanol (96 percent ethanol, 4 percent water, i.e., azeotropic) blends will not phase separate and can absorb five times more water than anhydrous ethanol blends. The implications of this are widespread, potentially affecting every aspect of ethanol’s role in fuel supplies. PDC works with many major oil and petrochemical companies, and owner Hans Keuken tells EPM how it all started.

 

One of his researchers was interested in challenging conventional ethanol drying methods using mol sieves and membranes. The goal was to find ways to reduce the cost and energy intensity of dehydration. A little bored by this proposal, Keuken said to his team, “If you really want to innovate—and the fuel-ethanol is going in the gasoline anyhow—maybe look for ways to separate ethanol and water with gasoline.” Keuken’s reasoning was that gasoline is full of aromatics also used in azeotropic distillation.

 

“In principle, one can use a liquid-liquid extraction column to extract ethanol from an ethanol-water mixture into a gasoline stream,” he says. This presumes that the two liquids then can be totally separated, but the researchers found this was not exactly the case. In the top of the extractor the densities of the two liquids were similar and took a long time to completely disengage, which led to prohibitively large extractor volumes that were operationally too expensive. An idea immediately followed, which was, “If we can’t get the water out, why not leave it in?” Keuken says. “So what appeared to be a show stopper for extraction promised to be an opportunity for hydrous ethanol blending—some call this serendipity.”

 

Gaining Acceptance
The oil industry looks at refinery streams as continuous mixtures of hydrocarbons with certain common behaviors which typically do not mix with water. “But ethanol is a substance that seriously disturbs this regular picture,” Keuken says. “Refiners were deceived by their intuitions.” PDC however approached gas-ethanol mixtures from more of a chemicals angle.

 

Many major oil companies are PDC clients. “Although they were reluctant to initially believe us, we are also in the lucky position to have enough technical credibility to be taken seriously,” Keuken says. After giving a presentation in Brussels, Belgium Walter Mirabella, an methyl tertiary butyl ether and ethyl tert-butyl ether lobbyist, was in the audience and asked Keuken, “Do you think the entire fuel industry is stupid?”

 

Shell Oil was approached with this information and according to Dautzenberg the oil major’s response was, ‘This cannot be true—we know everything about this.’ But everyone is using 20-year-old data,” he tells EPM. “They said they needed to repeat it and they did and conferred with us. They were surprised.”

 

Everyone working in ethanol thought they knew the whole concept of water separation and the necessity of extremely low water, says Tom MacDonald, who spent 30 years with the California Energy Commission as an ethanol fuels specialist. He retired last year and started his own consulting firm called MacDonald Associates. Dautzenberg and Keuken approached the CEC shortly before MacDonald’s retirement and asked if they could present their findings. “We were all skeptical in the beginning,” MacDonald says. After leaving the CEC, MacDonald went to Europe to meet with PDC officials who spun off a company called HE Blends BV, on the wet alcohol concept. He came back convinced. “I’ve had people looking hard at this to find any flaw, any problem, and it all looks very solid,” MacDonald says.

 

MacDonald still does some work for the CEC, but also finds interest in the Brazilian fuels industry where both hydrous and anhydrous blends exist. According to him, not much needs to be done in Brazil to transition to a hydrous ethanol economy. What’s harder though is convincing the U.S. federal and state governments, oil companies, pipeline operators and vehicle manufacturers that midlevel hydrous blends are a prudent evolution.

 

The team took its message to influential people in government and private industry in January, starting in Minnesota, the ethanol hotspot. The state passed the first E20 mandate in the United States a few years ago. “Minnesota is a place that could really do this the soonest,” MacDonald says. After visiting with the state agriculture department the team met with Kelly Davis the Renewable Fuels Association technical committee chair and ethanol specification guru.

 

ASTM revisited its water specification for ethanol (less than 1 percent) but the tests employed to verify PDC’s findings were bunk, McDonald says. “They had a procedure where you put anhydrous ethanol in the gasoline and then add water,” he says. “That’s a whole different animal than when it comes chemically bound in the ethanol itself.”

 

Implications and Research
An ethanol plant builder based in Minnesota is conducting a pro bono study to pinpoint the energy savings that result from skipping the dehydration step. The results are expected early this spring. Depending on the technology employed, Keuken suggests between 10 percent and 45 percent energy savings will be gained by eliminating dehydration. “The benefit of HE Blends’ discovery stem primarily from the avoided capital, operating and energy costs of eliminating the need for the hydrous-to-anhydrous ethanol step,” says Eric de Jager, marketing and sales manager with HE Blends. Jager also points out that a 4 percent product volume increase happens while reducing energy consumption and costs. “Overall a transition from anhydrous to hydrous ethanol for gasoline blending is expected to make a significant contribution to ethanol’s cost-competitiveness, fuel cycle net energy balance and greenhouse gas emissions profile,” he says.

 

Hydrous ethanol may be the key to ethanol’s acceptance in the mainstream fuel pipeline distribution network. “Conventional pipelining with [anhydrous] ethanol picks up water, and when it separates out corrosion is a concern,” Dautzenberg says. With higher concentrations of wet ethanol able to homogeneously retain up to five times more moisture than dry ethanol blends, the fear of phase separation is significantly reduced. Keuken backs up this point. “People associate water with corrosion but in this case the water is dissolved on a molecular level and completely sealed off by hydrocarbons, so these corrosion effects will not occur,” he tells EPM. Even international trade could benefit. “Stringent water specs on ethanol, which attracts water, oftentimes force people to dry twice,” Keuken says. This negatively impacts the alternative fuel’s overall energy balance.

 

Perhaps one of the most important aspects of hydrous ethanol blends is its effect on vehicle performance and emissions. Preliminary tests have already been done in Europe and the results on performance, fuel economy, emissions and engine wear for midlevel hydrous ethanol blends are all favorable, if not unexpectedly so. “Water injection in combustion engines increases the thermodynamic efficiency and this will increase mileage, which has never been properly investigated for normal cars,” Keuken says. “The water cools the mixture somewhat, which may allow for more mixture to enter the cylinder,” Jager explains. “But the greater effect comes later during combustion when the water takes in significant amounts of heat energy as it converts from liquid to gas, increasing piston pressure—torque—and reducing the peak temperature,” which reduces nitrogen oxide (NOx) formation.

 

Preliminary results of this kind were seen in a standard Volkswagen Golf 5 FSI tested on hydrous E15 by the SGS Drive Technology Center based in Austria and TNO Automotive in the Netherlands. A marginal increase in fuel efficiency coupled with hitting European Union 4 exhaust emissions targets and a cleaner engine internally were achieved. According to Jager, these results helped steer the Dutch and German governments to agree to fund an E0 to E85 performance curve research program for midlevel hydrous and anhydrous blends. Anhydrous and hydrous blends of E10, E25, E50 and E85, will be tested for blend optimization with respect to fuel consumption and engine emissions. MacDonald says he hopes to begin his own vehicle testing in the United States once he can convince an automaker to donate a car or two.

 

“In our view it’s a win-win for almost everybody,” Keuken says. “Producers can skip the drying step, sell 4 percent more volume, save on energy costs and operational headaches, maintenance and capital investments. International trade will benefit. Oil companies benefit from allowing higher water tolerances in their distribution systems. The car owners can benefit from a higher mileage per gallon and cleaner engine interior. The world can benefit from less overall greenhouse gas and NOx emissions.”

 

Ron Kotrba is an Ethanol Producer Magazine senior writer. Reach him at rkotrba@bbibiofuels.com or (701) 738-4962.

 

 

About Renergie

Renergie was formed by Ms. Meaghan M. Donovan on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita.  Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol.  Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program.  Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On  April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector.  On January 20, 2009, Florida Energy & Climate Commission amended RET Grant Agreement S0386 to increase Renergie’s funding from $1,500,483 to $2,500,000. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is renewable, more economical, cleaner, and more efficient than unleaded gasoline.  Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.

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Renergie to Test Hydrous Ethanol Blends

Posted on July 28, 2008. Filed under: Field-to-Pump, Hydrous Ethanol | Tags: , , , , , |

As provided for in Act No. 382, the use of hydrous ethanol blends of E10, E20, E30 and E85 in motor vehicles specifically selected for test purposes will be permitted on a trial basis in the State of Louisiana until January 1, 2012.  During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the performance of the motor vehicles. The hydrous blends will be tested for blend optimization with respect to fuel consumption and engine emissions.  Preliminary tests conducted in Europe have proven that the use of hydrous ethanol, which eliminates the need for the hydrous-to-anhydrous dehydration processing step, results in an energy savings of between ten percent and forty-five percent during processing, a four percent product volume increase, higher mileage per gallon, a cleaner engine interior, and a reduction in greenhouse gas emissions.

 

The following is an excerpt from an article by Troels Johansen that appeared in the July, 2007 issue of the Technical University of Denmark’s IC Engine Group newsletter.

 

The water tolerance of bioethanol fuel blends is being studied as part of a Bachelor thesis concerning specifications of fuel blends with a high ethanol content.

 

This spring, the first flexible fuel vehicle (FFV) will be available for car buyers in Denmark – the Ford Focus Flexifuel. Together with the governments’ newfound enthusiasm for biofuels, this seems to mark the beginning of a more environmentally friendly transport sector in Denmark. For biofuels to be commercially viable outside a small “green” segment of the population they have to be competitive both with regard to price, availability and performance.

 

In the case of USA and Sweden, these three factors have been incorporated through a common concept for introducing biofuels in general and bioethanol in particular. This entails:

• a certain lowering of taxes on biofuels, thereby reducing prices.

• adding a lesser amount of gasoline (15-25%) to the bioethanol to alleviate cold start difficulties which can be a problem in northern climates. This is known as the ‘E85’ blend.

• the ‘Flex Fuel’ option. This means that cars that can run on E85 can also run on gasoline and any mixture of the two. This effectively solves the availability issue, since a ‘northern hemisphere’-FFV will be able to refuel almost anywhere in the world, also where biofuels are not available.

 

In Brazil (where the market for FFVs is huge) a FFV is something quite different.  A Brazilian FFV is not designed to run on straight gasoline, but on either E100 (‘hydrous’ ethanol consisting of 93% ethanol and 7% water), E22 (22% Ethanol, 78% gasoline, 0% water) or any mixture of these two.  In theory this restricts the ‘southern hemisphere’-FFVs to areas where fuels with less than 78% gasoline are available (still primarily South America). The up side is that the production cost of the E100-fuel is much lower than for northern hemisphere E85.  The reason for this (and many of the other commercial choices concerning bioethanol) is the water content.

 

The production of bioethanol is in the main a question of removing water from the 11% ethanol/89% water-blend that fermentation produces. This is achieved through distillation up to the point where the blend is about 95% ethanol, and a so-called dehydration from that point up. The energy cost of removing one unit of water from the blend is at a constant low value up until about 80% ethanol in the blend, where it starts to increase quite sharply. If an ethanol purity of more than 95.6% (the azeotrope concentration) is required, the producer not only has to field these larger energy expenses but also needs to invest in separate dehydration equipment.  Clearly there is an economic incentive for using less than pure ethanol as a fuel and in fuel blends, as has been done in Brazil since the seventies.  The Brazilian experience shows that the presence of small (<10%) amounts of water in the fuel does not in itself cause a greater tendency to misfire in SI-engines than a proportionate leaning of the fuel/air mixture would do, provided that the vapor pressure of the hydrated ethanol at the ambient temperature is high enough. Experiments have even shown that the evaporation of the water in the intake manifold acts as a charge air cooling, which improves the volumetric efficiency and thereby the overall efficiency of the engine.  One of the most obvious downsides is, of course, that the heating value of water is zero and as such water is simply dead weight in the fuel tank. This clearly means that a car running on water-free (anhydrous) ethanol will still (even with the better volumetric efficiency) have a higher mileage per liter than one running on hydrous ethanol.  If the cost of the hydrous ethanol is sufficiently lower, it may, however, still provide a lower cost per mile travelled, that is if the percentile monetary saving of one liter hydrous ethanol vs. anhydrous is greater than the percentile reduction in heating value of one liter.

 

As mentioned above, the current ‘northern hemisphere’-FFVs are not designed to use either hydrous or anhydrous ethanol by itself, but rely on a measure of gasoline to alleviate cold start problems.  The higher vapor pressure of the gasoline (60-90 kPa vs. about 17 for ethanol) ensures that enough fuel (primarily the gasoline) will be vaporized in the injection process for the engine to start on, even when cold. However, the presence of gasoline in the fuel blend puts severe limits on how much water can be in the blend without phase separation occurring, that is the blend separating into two distinct liquid phases: an upper gasoline/ethanol phase and a lower water/ethanol phase. Because of the molecular dissimilarity of water and gasoline, these two are immiscible above a very few ppm. When adding ethanol as a third component, however, significantly more gasoline and water can coexist in the same blend, the ethanol effectively acting as a mediator between the two.  When using ethanol in blends with more than 90% gasoline, such as the ‘Bio 95’ offered by Statoil in Denmark, the ethanol volume is too small to significantly improve the water tolerance, and the ethanol produced for this purpose is therefore almost anhydrous. In fuel blends with a high ethanol content, however, this requirement should in theory be less strict, though few experimental data are available to substantiate exactly what the tolerances are of E85-type blends.

 

From a Danish perspective, the best experimental results that are available (produced in Brazil in 1993) have two different shortcomings.  Firstly, it does not supply data for temperatures below -10 degrees Celsius.  Since the miscibility of liquids depends heavily on the ambient temperature, though not in a strictly linear way, it is unknown what the water tolerances would be at the lowest Danish winter temperatures (-20 degrees Celsius during the night not being rare). Secondly, the exact composition of the gasoline used in these experiments is sure to have been different from the gasoline available in Denmark today, gasoline specifications not being uniform across time and borders.  As an example the upper limit of content of aromatics in gasoline was in 2005 lowered from 42 vol% to 35 vol%, something which in itself could have a relevance for the subject at hand, since studies have concluded that the content of aromatics are proportional with the water tolerance of gasoline.

 

As a part of the Bachelor thesis project, experiments have been performed to evaluate the water tolerances of ethanol/gasoline/water blends with a high content of ethanol (60-90%) at 0 and – 23 degrees Celsius, these being estimates of the lowest temperatures during the summer and winter half-year, respectively.  

 

Even though the long term stability of the fuel blends have not been fully tested yet, the test data strongly indicates that the ethanol used in E85-type fuel blends could be significantly less pure, and therefore cheaper, than the ethanol used now for these purposes (the overall vol% of water currently not being above 0.5% in E85).

 

 

About Renergie

Renergie was formed by Ms. Meaghan M. Donovan and Mr. Michael J. Donovan on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita.  Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol.  Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program.  Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On  April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector.  On January 20, 2009, Florida Energy & Climate Commission amended RET Grant Agreement S0386 to increase Renergie’s funding from $1,500,483 to $2,500,000. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is renewable, more economical, cleaner, and more efficient than unleaded gasoline.  Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.

 

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An Overview of the U.S. Transportation Fuel Sector

Posted on July 27, 2008. Filed under: Field-to-Pump, Hydrous Ethanol | Tags: , , |

An Overview of the U.S. Transportation Fuel Sector

 

Peaking of World Crude Oil Production

Virtually all transportation fuels are derived from crude oil.  As long as crude oil remains relatively inexpensive and available, relative to alternative fuels, consumers will use it.  The most widely accepted model for petroleum extraction states that crude oil production, whether from an individual well, a particular region or worldwide, is shaped like a bell curve with respect to time.  Production ramps up after discovery is made, tapers off as the peak approaches, peaks, and then begins to decline.  This theory was formulated by Dr. M. King Hubbert in 1956, a geophysicist who worked for Shell.  “Hubbert’s Peak” marks the onset of decline, a trend that accelerates as the cost of further extraction approaches the commercial value of each barrel pumped.  Dr. Hubbert correctly predicted that U.S. crude oil production would peak in the early 1970s.  Since then, the U.S. has been able to meet its growing crude oil demand by increasing imports.  There has historically been broad agreement that the world’s ultimate oil supply is approximately 2 trillion barrels, of which approximately 50 percent has been consumed.  Most of the world’s so-called easy oil has already been discovered or extracted, leaving the bulk of the undiscovered or unexploited oil in deep water, or other isolated areas far from transportation infrastructure and markets.  The much-touted Alaska National Wildlife Refuge is estimated to contain 7.7 billion barrels of recoverable oil, enough to supply the United States just over a year.  Although tar sands and heavy oil hold promise, their economics and energy balance are daunting at best.  The debate rages over when the worldwide peak will occur (some say it has already occurred), but estimates range from immediately to 70 years from now.  However, there is no debate over the fact that, sooner or later, crude oil will no longer be affordable; therefore an alternative will have to be used.  Renergie wants to ensure that the U.S. is prepared for a world without oil.

 

As indicated by the following table, over the four year period from 2002 – 2006, crude oil prices have nearly tripled as global demand, especially in China and India, increased and supplies tightened.

 

Brent Crude Oil Spot Prices

                                    2002                2003                2004                2005                2006

Price/bbl                     $24.69             $27.14             $35.58              $56.92            $71.12

 

 

U.S. Petroleum Consumption

In 2005, the United States consumed approximately 21 million barrels of petroleum per day.  Approximately 62% of this amount was imported.  The Energy Information Administration (“EIA”) has projected petroleum consumption in 2025 to be 28.3 million barrels per day with 70% of this amount to be imported.  The transportation sector accounts for two-thirds of U.S. petroleum use.  In 2004, U.S. petroleum consumption for transportation was approximately 13.86 million barrels per day, or just over 5 billion barrels per year.  The EIA projection of U.S. liquid fuel consumption through 2030 indicates that the demand for gasoline will increase 31 percent. Reducing the transportation sector’s reliance on oil is clearly the key to improving our nation’s energy security.

 

Moreover, the U.S. transportation sector is responsible for one-third of our country’s carbon dioxide emissions, the principal greenhouse gas contributing to global warming.  Combustion of biofuels also releases carbon dioxide, but because biofuels are made from plants that just recently captured that carbon dioxide from the atmosphere – rather than billions of years ago – that release is largely balanced by carbon dioxide uptake for the plant’s growth.  The carbon dioxide released when biomass is converted into biofuels and burned in truck or automobile engines is recaptured when new biomass is grown to produce more biofuels.

 

Ethanol History

The use of ethanol as an automobile fuel in the United States dates as far back as 1908, to the Ford Model T.  Henry Ford was a supporter of home-grown renewable fuels and his Model T could be modified to run on either gasoline or pure alcohol.  After World War II, there was little interest in the use of agricultural crops to produce liquid fuels.  Fuels from petroleum and natural gas became available in large quantities at low cost, eliminating the economic incentives for production of liquid fuels from crops.  Interest in ethanol was renewed in the 1970s, when oil supply disruptions in the Middle East became a national security issue and the United States began to phase out lead (an octane booster) from gasoline.  Federal and State tax incentives have made ethanol economically attractive in the Corn Belt of the Midwest, but the difficulty and high cost of transporting ethanol precludes significant consumption in other markets. 

 

Governmental Regulation and Federal Ethanol Supports

In the United States, ethanol has been described as a “political commodity,” due to the importance of federal and state government policies that stimulate the production and consumption of ethanol and make it price-competitive in fuel markets. Government incentives, such as small ethanol producer tax credits and import duties on fuel ethanol imports, helped increase the production of ethanol during the 1980s.

 

The Energy Policy Act of 2005 (“EPACT 2005”) established the Renewable Fuels Standard (“RFS”) which directs that gasoline sold in the U.S. contain specified minimum volumes of renewable fuel. 

 

The Energy Independence and Security Act of 2007 (“H.R. 6”), which became law on December 19, 2007, sets a new RFS that starts at 9.0 billion gallons of renewable fuel in 2008 and rises to 36 billion gallons by 2022. 

 

Under H.R. 6, the U.S. Department of Energy (“DOE”) is directed to create a grant program to help establish or convert infrastructure to use renewable fuels including E85.
                                            
The Blender’s Tax Credit provides a credit of $0.51 to fuel blenders for every gallon of ethanol blended with gasoline.

 

Under Section 1342 of EPACT 2005, fueling stations receive a tax credit of 30% for the cost of installing pumps dispensing alternative fuel (e.g. Renergie E85 ethanol pumping stations).

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Moving Ethanol Demand Beyond Being Just a Blending Component

Posted on July 27, 2008. Filed under: Blender's Tax Credit, Field-to-Pump, Hydrous Ethanol | Tags: , , , , |

 

Florida Company Committed to Moving Ethanol Demand Beyond Being Just a Blending Component in Gasoline to a Truer Fuel Alternative in the Form of Renergie E85

 

_________

 

 

Renergie E85, Produced Solely from Sweet Sorghum Juice and Priced at 20 Percent Less Per Gallon than Regular Gasoline, Will Benefit Consumers, Farmers and Gas Station Owners

 

 

 

Gainesville, FL (April 25, 2008) – At the pump, the price of a gallon of gasoline increases almost on a daily basis.  The price of corn is expected to rise as high as $7.50 a bushel by summer.  While alleging an oversupply of corn ethanol, U.S. oil companies still import thousands of barrels of ethanol from foreign sources every month. Cargill imports ethanol from its dehydration facility in El Salvador.  Can ethanol provide any relief at the pump to the U.S. driving public?  Renergie believes that ethanol can significantly lower the pump price if it is produced from a non-corn feedstock and marketed directly by the producer as E85.  Ethanol must compete against, rather than be an inexpensive blending component in, gasoline.

 

Renergie produces ethanol solely from sweet sorghum juice. The controversial “food vs. fuel” debate does not apply to Renergie’s operations.  Sweet sorghum has been called a “camel among crops,” owing to its wide adaptability, its marked resistance to drought and saline-alkaline soils, and tolerance to high temperature and waterlogging.  It can grow in marginal soils, ranging from heavy clay to light sand.  Sweet sorghum requires one-half of the water and only one-quarter the amount of nitrogen used to grow corn.  The energy requirement for converting sweet sorghum juice into ethanol is less than half of that required to convert corn into ethanol.  The Renergie variety of sweet sorghum yields between 500 to 800 gallons of ethanol per acre.  In 2007, China and India produced 1.3 billion gallons of ethanol from sweet sorghum juice.  The Renergie project is the first time that ethanol is produced solely from sweet sorghum juice in the U.S.

 

Cost of Feedstock

Renergie will not fall victim to rising feedstock costs.  Renergie ensures that there is a link between the compensation paid to Renergie’s feedstock producers and ethanol market conditions.  Farmers will receive a lease payment for their acreage and a royalty payment based on a percentage of Renergie’s gross sales of ethanol.  The Renergie ethanol project will mark the first time that Louisiana and Florida farmers will share in the profits realized from the sale of value-added products made from their crops. 

 

Decentralized Network of Smaller Plants and Commitment to Rural Economic Development

Renergie was formed on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita.  Each ethanol plant has a production capacity of five (5) million gallons per year (5 MGY) of fuel-grade ethanol.  Renergie intends to replicate its Louisiana decentralized network of ethanol plants in Florida.  Upon completion of the initial network of twenty ethanol plants, Renergie will have a total combined annual production capacity of one-hundred (100) million gallons. 

 

Smaller is better.  The distributed nature of a network of small 5 MGY plants reduces Renergie’s feedstock supply risk, does not burden local water supplies and provides broad-based economic development.  In Louisiana, Renergie is headquartered in the small city of Kaplan (population of less than 5,000).  Renergie has agreed to donate two cents of every gallon of ethanol it sells to the City of Kaplan.  Renergie firmly believes that the success of the ethanol industry requires a long-term commitment to rural economic development.

 

Infrastructure Development

Renergie’s “field-to-pump” strategy is to produce ethanol locally and market ethanol locally. There is not an oversupply of ethanol.  The major obstacle to widespread ethanol usage continues to be the lack of fueling infrastructure.  Only 1,413, of the nearly 180,000 retail gasoline stations in the United States, offer E85.  The day of building 100 MGY corn-to-ethanol plants in the Midwest corn belt, for the sale of E10 to consumers on the U.S. East Coast and West Coast, is over!  Renergie is focusing its efforts on locally growing ethanol demand beyond the 10% blend market.  Initially, Renergie will directly market E85, a blend of 85 percent ethanol and 15 percent gasoline for use in FFVs, to local fuel retailers under the brand Renergie E85.  Renergie’s unique strategy is to blend fuel-grade ethanol with gasoline at the gas station pump.  Currently, ethanol providers blend E10 and E85 at their blending terminal and transport the already blended product to retail gas stations.  Once state approval is received, Renergie’s variable blending pumps will be able to offer the consumer a choice of E10, E20, E30 and E85.  Via use of the Blender’s Tax Credit, Renergie will be able to ensure that gas station owners are adequately compensated for each gallon of fuel-grade ethanol that is sold via Renergie’s variable blending pumps at their gas stations.

 

 

 

About Renergie

Renergie was formed by Ms. Meaghan M. Donovan on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita.  Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol.  Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program.  Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On  April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector.  On January 20, 2009, Florida Energy & Climate Commission amended RET Grant Agreement S0386 to increase Renergie’s funding from $1,500,483 to $2,500,000. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is renewable, more economical, cleaner, and more efficient than unleaded gasoline.  Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.

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Advanced Biofuel Bill Signed into Law

Posted on July 27, 2008. Filed under: Field-to-Pump, Hydrous Ethanol | Tags: , , , , , |

Louisiana Enacts the Most Comprehensive Advanced Biofuel Legislation in the Nation

__________________

 

Advanced Biofuel Industry Development Initiative Benefits Consumers,

Farmers and Gas Station Owners with Localized “Field-to-Pump” Strategy

 

Baton Rouge, LA (July 26, 2008) – Governor Bobby Jindal has signed into law the Advanced Biofuel Industry Development Initiative, the most comprehensive and far-reaching state legislation in the nation enacted to develop a statewide advanced biofuel industry.  Louisiana is the first state to enact alternative transportation fuel legislation that includes a variable blending pump pilot program and a hydrous ethanol pilot program.

 

Field-to-Pump Strategy

The legislature found that the proper development of an advanced biofuel industry in Louisiana requires implementation of the following comprehensive “field-to-pump” strategy developed by Renergie, Inc.:

(1) Feedstock Other Than Corn

(a) derived solely from Louisiana harvested crops;

(b) capable of an annual yield of at least 600 gallons of ethanol per acre;

(c) requiring no more than one-half of the water required to grow corn;

(d) tolerant to high temperature and waterlogging;

(e) resistant to drought and saline-alkaline soils;

(f) capable of being grown in marginal soils, ranging from heavy clay to light sand;

(g) requiring no more than one-third of the nitrogen required to grow corn, thereby reducing the risk of contamination of the waters of the state; and

(h) requiring no more than one-half of the energy necessary to convert corn into ethanol.

(2) Decentralized Network of Small Advanced Biofuel Manufacturing Facilities

Smaller is better.  The distributed nature of a small advanced biofuel manufacturing facility network reduces feedstock supply risk, does not burden local water supplies and provides for broader based economic development.  Each advanced biofuel manufacturing facility operating in Louisiana will produce no less than 5 million gallons of advanced biofuel per year and no more than 15 million gallons of advanced biofuel per year.

(3) Market Expansion

Advanced biofuel supply and demand shall be expanded beyond the 10% blend market by blending fuel-grade anhydrous ethanol with gasoline at the gas station pump.  Variable blending pumps, directly installed and operated at local gas stations by a qualified small advanced biofuel manufacturing facility, shall offer the consumer a less expensive substitute for unleaded gasoline in the form of E10, E20, E30 and E85. 

 

 

Pilot Programs

(1) Advanced Biofuel Variable Blending Pumps – The blending of fuels with advanced biofuel percentages between 10 percent and 85 percent will be permitted on a trial basis until January 1, 2012. During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the equipment used to dispense the ethanol blends to ascertain that the equipment is suitable and capable of producing an accurate measurement.

(2) Hydrous Ethanol – The use of hydrous ethanol blends of E10, E20, E30 and E85 in motor vehicles specifically selected for test purposes will be permitted on a trial basis until January 1, 2012.  During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the performance of the motor vehicles. The hydrous blends will be tested for blend optimization with respect to fuel consumption and engine emissions.  Preliminary tests conducted in Europe have proven that the use of hydrous ethanol, which eliminates the need for the hydrous-to-anhydrous dehydration processing step, results in an energy savings of between ten percent and forty-five percent during processing, a four percent product volume increase, higher mileage per gallon, a cleaner engine interior, and a reduction in greenhouse gas emissions.

HB 1270, entitled “The Advanced Biofuel Industry Development Initiative,” was co-authored by 27 members of the Legislature.  The original bill was drafted by Renergie, Inc.   Representative Jonathan W. Perry (R – District 47), with the support of Senator Nick Gautreaux (D – District 26), was the primary author of the bill.  Reflecting on the signing of HB1270 into law, Brian J. Donovan, CEO of Renergie, Inc. said, “I am pleased that the legislature and governor of the great State of Louisiana have chosen to lead the nation in moving ethanol beyond being just a blending component in gasoline to a fuel that is more economical, cleaner, renewable, and more efficient than unleaded gasoline.  The two pilot programs, providing for an advanced biofuel variable blending pump trial and a hydrous ethanol trial, established by the State of Louisiana should be adopted by each and every state in our country.”

 

 

State Agencies Must Purchase or Lease Vehicles That Use Alternative Fuels

Louisiana’s Advanced Biofuel Industry Development Initiative further states, “The commissioner of administration shall not purchase or lease any motor vehicle for use by any state agency unless that vehicle is capable of and equipped for using an alternative fuel that results in lower emissions of oxides of nitrogen, volatile organic compounds, carbon monoxide, or particulates or any combination thereof that meet or exceed federal Clean Air Act standards.”

 

 

Advanced Biofuel Price Preference for State Agencies

Louisiana’s Advanced Biofuel Industry Development Initiative provides that a governmental body, state educational institution, or instrumentality of the state that performs essential governmental functions on a statewide or local basis is entitled to purchase E20, E30 or E85 advanced biofuel at a price equal to fifteen percent (15%) less per gallon than the price of unleaded gasoline for use in any motor vehicle. 

 

 

Economic Benefits

The development of an advanced biofuel industry will help rebuild the local and regional economies devastated as a result of hurricanes Katrina and Rita by providing:

(1) increased value to the feedstock crops which will benefit local farmers and provide more revenue to the local community;

(2) increased investments in plants and equipment which will stimulate the local economy by providing construction jobs initially and the chance for full-time employment after the plant is completed;

(3) secondary employment as associated industries develop due to plant co-products becoming available at a competitive price; and

(4) increased local and state revenues collected from plant operations will stimulate local and state tax revenues and provide funds for improvements to the community and to the region.

“Representative Perry and Senator Gautreaux have worked tirelessly to craft comprehensive advanced biofuel legislation which will maximize rural development, benefit consumers, farmers and gas station owners while also protecting the environment and reducing the burden on local water supplies,” said Donovan.  “Representative Perry, Senator Gautreaux, and Dr. Strain, Commissioner of the Louisiana Department of Agriculture and Forestry, should be praised for their leadership on this issue.”

About Renergie

Renergie was formed by Ms. Meaghan M. Donovan and Mr. Michael J. Donovan on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita.  Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol.  Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program.  Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On  April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector.  On January 20, 2009, Florida Energy & Climate Commission amended RET Grant Agreement S0386 to increase Renergie’s funding from $1,500,483 to $2,500,000. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is renewable, more economical, cleaner, and more efficient than unleaded gasoline.  Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.

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    About

    Renergie created “field-to-pump," a unique strategy to locally produce and market advanced biofuel (“non-corn fuel ethanol”) via a network of small advanced biofuel manufacturing facilities. The purpose of “field-to-pump” is to maximize rural development and job creation while minimizing feedstock supply risk and the burden on local water supplies.

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