Archive for June, 2009

Tenn. Lawmakers Pass Biofuels Bill After Compromise

Posted on June 17, 2009. Filed under: Blender's Tax Credit | Tags: , , , , , |

Tenn. Lawmakers Pass Biofuels Bill After Compromise  

By George Orwel

DTN Ethanol Center

June 16, 2009

 

 

NEW YORK (DTN) — The Tennessee legislature passed legislation that compels refiners and other fuel suppliers in the state to make available to wholesalers unblended gasoline and gasoline blending stock so they can blend it themselves with ethanol.

The legislation was passed by Tennessee’s House of Representatives on June 9 and the state senate on June 12. The legislation awaits the signature of Gov. Phil Bredesen to become law, said Lee Harrell, a legislative aide for Speaker Pro Tempore of the Senate Jamie Woodson.

The bill also forces refiners and suppliers to make available to wholesalers diesel that is suitable for blending with biodiesel.

The passage of the bill came after Tennessee state lawmakers last month worked out a compromise between Valero Energy Corp and Tennessee fuel wholesalers over the bill.

Valero had threatened to shut down its 195,000 bpd refinery in Memphis if lawmakers advanced the bill into law. The refinery employs about 310 people, according the company’s Web site, and so a shutdown of the plant would mean job losses.

Valero appealed to Bredesen to intervene, arguing the proposal to require the refinery to allow “our wholesale customers to blend ethanol into gasoline made at the refinery” would require capital expenditures of between $130 million and $150 million.

“Coupled with the current economic downturn, this makes no economic sense for the refinery, and the expenditure would cause Valero to seriously consider closing the plant,” company spokesman Bill Day told DTN at the time.

Day added that in order to make gasoline on demand for wholesalers to do their own blending, the Memphis refinery would need to have separate storage and pipeline systems for ethanol-blended fuels and conventional unblended fuels.

Soon after, Tennessee House Speaker Kent Williams brought together representatives from both Valero and the wholesalers to work out a compromise. Both sides reached a deal that allowed the bill to proceed into law.

Emily LeRoy, a spokeswoman for Tennessee Fuel and Convenience Store Association, which represents wholesalers, told DTN that the compromise offered Valero some leeway, but the refiner would still have to provide unblended gasoline and diesel to wholesalers.

The version of the bill passed by the state’s congress, a copy of which was made available to DTN, protects refiners and suppliers from any liability in lawsuits arising from downstream blending.

That’s what Valero got out of the compromise, LeRoy said Tuesday.

The legislation also provides a fine of $5,000 per day for noncompliance, and gives the state commissioner of agriculture the authority to inspect refinery premises to ensure compliance. Refiners are also required to keep business records and to make them available to inspectors charged with enforcing the law.

 

 

 

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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Four Ways to Solve the Energy Crisis

Posted on June 15, 2009. Filed under: Advanced Biofuel, Blender's Tax Credit, Field-to-Pump | Tags: , , |

Four ways to solve the energy crisis

By TIM HEFFERNAN
ESQUIRE

 Seattle Post-Intelligencer

 May 18, 2009

 

You hear it all the time: We’ve got to reduce our dependence on foreign oil; it’s a matter of homeland security. Fine. Nobody’s arguing. But the solutions that get offered — drilling in ANWR, mandating better automobile fuel efficiency, pushing ethanol — don’t really solve anything. They’re politically impossible, or too expensive, or contrary to free-market forces. They’re losers.

Energy-independence advocate Gal Luft looks for winners. The former lieutenant colonel in the Israel Defense Forces and counterterrorism expert fervently believes that the only way to make America safe is to make it energy independent. And so as executive director of the Institute for the Analysis of Global Security and cofounder of the Set America Free Coalition, he has set out to do just that.

Luft advises Congress and security companies. He briefs industrial and environmental groups. Yet what separates him from other energy specialists are his pragmatic solutions. He doesn’t peddle pie-in-the-sky political strategies. He’s a realist. He has a single goal: freeing America from the grip of foreign oil. And he wants to do it now. Here are four steps he says we can — and should — take today.

1. Make gasoline-only cars illegal

“Every gas-powered car has an average street life of seventeen years, which means that the minute you leave the lot, you’re signing up for two decades of foreign-oil dependence. The easiest way to change this is to mandate that every vehicle sold in the U. S. is flex-fuel compatible so that it can run on just about any blend of hydrocarbon-based fuels — gasoline, ethanol, methanol, etc. The technology already exists, and the process is cheap, about a hundred dollars per vehicle. Detroit will cry about ‘government interference,’ but in fact the mandate would open a vast new free market in alternative-fuel development.”

2. Kill the Iowa caucuses

“Here’s the first thing every presidential candidate who visits Iowa is asked: ‘Where do you stand on ethanol?’ Why is this a problem? Because the ethanol lobby has managed to place huge tariffs on ethanol produced abroad while freezing out the development of other alternative fuels at home. It portrays itself as this sort of savior, the domestic solution to our reliance on foreign oil, but it really just protects a tiny number of Midwestern corn farmers. Anyone who thinks otherwise, bear in mind: Even if every single kernel of corn grown in America were converted to ethanol, it would still only replace about 12 percent of America’s gasoline requirement.”

3. Think of the world in terms of sugarcane

“America hasn’t been very good about making friends in the Middle East lately, but there are still a few countries in Latin America, Africa, and Southeast Asia that like us. And many of them, such as Panama, Kenya, and Thailand, grow sugarcane, from which you can make ethanol at half the cost of making it from corn. We should direct foreign aid throughout the agricultural sector in these countries to increase their efficiency and create jobs. That will make them happy, and it’ll improve our national security. They’ll be our friends forever. Unlike the OPEC nations.”

4. Revolutionize waste

“Sixty-five percent of our garbage is biomass: food, paper, scrap wood. All of it could be converted to methanol. The process has been around for two hundred years. And it’s twice as efficient as cellulosic ethanol, supposedly the next big thing in alternative fuels. Then there’s coal — America has a quarter of the world’s reserve, but we use it mainly to feed power plants, which is a dirty and inefficient use. Instead, coal can be converted to clean-burning methanol for the equivalent of one dollar per gallon. Last, look to recyclables, like black liquor, a toxic by-product of the paper industry. Right now, paper mills inefficiently recycle it themselves. But black liquor can be converted to methanol. Do so and we’d generate nine billion gallons of methanol a year — almost twice the ethanol we now make from corn.”

Actually getting this done

“These are only four of many common-sense opportunities throughout the economy, but we’re not taking advantage of them, because there isn’t a sustainable market for alternative fuels. Yet. Which brings us back to step one: flex-fuel technology. Get that and the other three will take care of themselves. There will be stiff opposition from the oil, corn, and auto lobbies. There always is. But let’s hope that Washington can step up for a change. Because once you take politics out of the energy policy, you get very different — and much better — results.”

Reprinted with Permission of Hearst Communications, Inc. Originally Published: Four Ways to Solve the Energy Crisis

 

 

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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We’ll Never Pump Enough Oil

Posted on June 15, 2009. Filed under: Blender's Tax Credit, Field-to-Pump | Tags: , , , , |

We’ll never pump enough oil

BY GAL LUFT
Miami Herald

June 13, 2009

 

This week America transitioned from analog to digital television broadcasts, ushering what could be described as an open standard for television. This means that consumers will have a choice between buying a digital set or signing up to cable or satellite service and keeping their old antenna by installing a signal-dumbing converter box which allows them to get analog signal.

Without the converter, an analog TV began showing snow on the screen starting as of Friday morning. Regardless of whether the shift is a good idea or not — it probably is as it allows better spectrum usage — it is sad commentary of our priorities as a society. Strategic as Congress may imagine television is in our lives, it is not nearly as important as transportation.

Yet, the same Congress that mandated consumer choice in television reception modes denies us choice in transportation fuels: our cars, trucks, ships and planes can run on nothing but petroleum.

Such choice at the pump is neither more difficult nor more costly to achieve than choice at the screen. In Brazil, more than 80 percent of the new cars are flex fuel vehicles capable of running on any combination of gasoline and alcohols like ethanol and methanol. To make a new car flex fuel costs an automaker an extra $100 or less.

All that is needed is a chip and corrosion resistant fuel line. To convert our television, Congress has already allocated nearly $2 billion in taxpayer money to provide $80 worth of coupons per household to subsidize conversion boxes. Brazilians may not have as sophisticated television system but they can choose among fuels.

Last year, when oil prices were at their three-digit level more alcohol was sold in Brazil than gasoline, and the Brazilian economy was hardly touched by the oil crisis. At the same time, with no such fuel choice Americans shelled out hundreds of billions of dollars for foreign oil, a monumental loss of national wealth that popped the mortgage bubble and brought the United States to the brink of economic collapse.

Brazil’s success story hasn’t escaped the eyes of our leaders. President Obama pledged numerous times to pass a law that would mandate flex-fuel engines in all automobiles in order to break oil’s virtual monopoly over transporation fuel. Secretary of Interior Ken Salazar, while still in the Senate, was the lead sponsor of legislation that would have ensured new cars sold in the United States offer fuel flexibility. Energy Secretary Steven Chu has also spoken on the merits of this policy. But judging from its recent actions Congress is not on board. What seems to be the signature energy legislation of the 111th Congress, the American Clean Energy and Security Act, (also known as the Waxman-Markey cap-and-trade bill) does almost nothing to break oil’s monopoly in transportation fuels and provide Americans the kind of choice they have in choosing a television set, a cup of coffee or any other consumer product.

A provision that could have made a difference, an Open Fuel Standard to ensure 50 percent of new cars are flexible-fuel capable of running on any blend of alcohol and gasoline was watered down to meaninglessness by the House Energy and Commerce Committee. Such a standard which could enable consumers to choose a fuel alternative at the pump next time gasoline prices rise to $5 a gallon was rejected by Chairman Henry Waxman due to pressure by the automakers.

The same distressed GM and Ford that, time after time, appeared before Congress asking for taxpayer money and promising that they would make 50 percent of their cars flex-fuel vehicles by 2012, ordered their lobbyists to scuttle any legislation that would require them to do just that.

Oil prices are rising, and pain will again be felt at the pump. Saudi Arabia’s oil minister Ali Naimi has recently predicted $150-a-barrel oil within three years.

Yet, as if nothing was learned from the previous oil shock of last summer, we continue to roll onto our roads 10 million new cars annually that can run on nothing but petroleum each with an average street life of 16 years. We are in for a shock, and when it comes we’ll again be able to view Americans’ vulnerability contrasted with Brazilians’ resiliency.

Only this time, we’ll be watching on our digital sets.

Gal Luft is executive director of the Institute for the Analysis of Global Security (IAGS). He is co-author of Energy Security Challenges for the 21st Century (2009).

 

 

 

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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President Obama Voices Support for Biofuels Development and Continued Viability of Existing Ethanol Industry

Posted on June 15, 2009. Filed under: Advanced Biofuel, Blender's Tax Credit, Field-to-Pump | Tags: , , |

President Obama Voices Support for Biofuels Development and Continued Viability of Existing Ethanol Industry

GBC Asked to Contribute to Implementation of Presidential Biofuels Directive

 

 

WASHINGTON, June 1 /PRNewswire/ — In his effort to develop a national biofuels strategy to reduce America’s dependence on imported oil, President Barack Obama invited the Governors’ Biofuels Coalition to partner with key members of his Administration to achieve his vision for energy independence.

In a May 27, 2009, letter to Coalition Chair Gov. John Hoeven of North Dakota and Vice Chair Gov. Chet Culver of Iowa, President Obama praised the organization for its leadership in biofuels policy and public education. The President asked the Coalition to join him in implementing his Presidential Biofuels Directive, which was issued earlier this month. The directive outlined the President’s vision for biofuels development and his expectations for key cabinet and administration officials to lead the Administration’s biofuels initiatives. The President noted that the Coalition’s February 2009 recommendations helped form key points of the directive, and led to the President’s request for the Coalition to work with “members of my cabinet to implement the directive.”

In the letter, President Obama notes that his Administration is committed to the rapid development of cellulosic ethanol. “But this transition will be successful only if the first-generation biofuels industry remains viable in the near-term, and if we remove long-standing artificial barriers to market expansion…,” the letter states.

“We cannot achieve the promise of cellulosic biofuels if we do not continue to support and develop the first-generation corn ethanol industry and the infrastructure needed to distribute and deliver biofuels today and in the future,” said Governor Hoeven. “This is an endorsement for our continued commitment to the ethanol industry we have today, while moving forward with the development of emerging cellulosic biofuels technologies.”

“While the President’s acknowledgement of the Coalition’s leadership is certainly gratifying, we understand that there is both a great responsibility and a great challenge in helping the President implement his biofuels directive,” said Governor Culver. “The Coalition is up to the task. We are very honored, and look forward to working with the Administration to achieve the President’s vision for a transition from petroleum-derived transportation fuels to a sustainable, low carbon energy future.”

The President also noted the important economic development role that biofuels can play. “It is my hope that the Presidential Biofuels Directive will lead to new jobs, new businesses and reduce dependence on foreign oil,” he wrote.

“The governors in the Coalition have seen the profound and positive impact that first-generation biofuels are having on our state and local economies,” Governor Hoeven added. “They are the foundation for an even more robust and sustainable domestic energy industry that will enhance our nation’s economy and energy security.”

President Obama’s Letter to the Coalition can be viewed at:

 http://www.governorsbiofuelscoalition.org/

The Coalition’s Letter and Recommendations to President Obama can be viewed at: www.governorsbiofuelscoalition.org/assets/files/GBC_ObamaLetter1.pdf

For fifteen years, the Governors’ Biofuels Coalition has provided national leadership on biofuels issues. The Coalition’s policy activities address all biofuels, including ethanol, biodiesel, advanced biofuels, co-products, and technologies yet to come. For more information, visit www.GovernorsBiofuelsCoalition.org.


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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Shell’s Cellulosic ‘First’ Is More of a Second

Posted on June 14, 2009. Filed under: Advanced Biofuel, Blender's Tax Credit, Field-to-Pump | Tags: , , , |

Shell’s Cellulosic ‘First’ Is More of a Second

By Ian Austen

The New York Times

June 13, 2009

 

Much fanfare attended the arrival in Ottawa earlier this week of Luis Scoffone, Royal Dutch Shell’s vice president of biofuels. Mr. Scuffone flew in from England and descended, along with John Baird, Canada’s transport minister, on a large Shell station at Merivale Road — an undistinguished avenue of strip malls and big box stores.

It was here, at a single pump, Shell said in a news release, where customers could become “the first in the world to fill their tanks with gasoline containing advanced biofuel made from wheat straw.”

That was news to MacEwen Petroleum, however — a small regional service station chain based in Maxville, Ontario.

MacEwen apparently beat the multinational giant to the punch almost five years ago at a station in downtown Ottawa. And it did so, it seems, using ethanol from Iogen, a cellulosic ethanol maker also based in Ottawa, which recently became half-owned by Shell.

The attraction of cellulosic ethanol is that it’s made from agricultural and forestry waste materials rather than crops grown to produce fuel. That, its promoters hope, will allow it to escape the food-versus-fuel debate which has plagued ethanol made from corn and other crops.

Iogen, which also is supplying the ethanol for Shell’s month-long promotion, uses enzymes to break down wheat straw and make about 60,000 liters of ethanol a month at its demonstration plant in Ottawa.

In an interview following the Shell news conference, Brian Foody, Iogen’s president and chief executive, acknowledged that some of the production not needed by Iogen in the past for testing has gone into the pool of ethanol used for gasoline blending.

“There have been molecules from our plant that have made their way into cars,” Mr. Foody said.

 

Gas stationIan Austen/The New York Times MacEwen Petroleum, a small service station operator in Ottawa, said it was selling cellulosic ethanol five years ago. It also said it has been approached by Iogen about supplying ethanol for a MacEwen pump that sells an 85 percent ethanol blend, pictured above.

 

But executives at MacEwen, which was once a major Iogen customer, said they were a bit surprised, and somewhat amused, by the claims from Iogen and Shell.

When Ottawa hosted the 2004 Grey Cup, the Canadian Football League’s championship, MacEwen and Iogen offered a week long, cellulosic ethanol promotion at a busy station near an expressway in downtown Ottawa.

MacEwen was an early promoter in Canada of ethanol-blended gasoline. Marcel Labelle, the company’s vice president of sales and supply said “we were particularly careful about putting only their product in” the gasoline sold at that station’s ethanol blend pumps during the week preceding the football game.

The effort was publicized in a news release, and official Grey Cup vehicles, which were fueled at the MacEwen station, bore photos of wheat straw, the Iogen logo and the slogan: “Fueled with low CO2 cellulose ethanol.”

Outside of that promotion, Mr. Labelle said that MacEwen regularly purchased most of Iogen’s production during 2004 and 2005 and blended it, at varying levels, into gasoline.

“When we were doing this, the major oil companies wouldn’t touch ethanol,” Mr. Labelle said. “It was taking refined product out of their system. They’ve been caught out. And I’m sure Shell doesn’t want to be embarrassed.”

Kirsten Smart, a spokeswoman at Royal Dutch Shell in London, qualified the company’s earlier claim in an e-mail message on Friday:

“We believe this is the first customer offering where over a month long period consumers can knowingly purchase gasoline with a 10 percent blend of cellulosic ethanol, and the first time it has been actively marketed.”

Phil von Finckenstein, a spokesman for Iogen, said in telephone conversation and by e-mail that MacEwen only offered “a low-level blend” in 2004, not the 10 percent cellulosic mix now on sale at Shell. He added that the pumps were primarily for Grey Cup vehicles. “The public was happenstance if they got the fuel,” Mr. Finckenstein said.

Mr. Labelle, after consulting company records, agreed that early customers may have received slightly less than 10 percent cellulosic ethanol because there initially was some residual gasoline blended with corn ethanol in the station’s storage tanks.

But that gas station is replenished more than once a week, Mr. Labelle said. So many motorists received gasoline only blended with cellulosic ethanol.

Iogen, Mr. Labelle said, has approached MacEwen about supplying ethanol for a pump at the downtown station that sells an 85 percent ethanol blend, which is used mostly by federal government vehicles. If something comes of those talks, Mr. Labelle said he expected the cellulose marketing machinery to kick in again.

“Once they are done with us,” he said, “they’ll issue another press release.”

 

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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U.S. Environmental Protection Agency Grants First-of-its-Kind Testing Exemption to Renergie

Posted on June 9, 2009. Filed under: Advanced Biofuel, Blender's Tax Credit, Field-to-Pump | Tags: , , , , |

U.S. Environmental Protection Agency Grants First-of-its-Kind Testing Exemption to Renergie

 

Renergie to Test Hydrous E10, E20, E30 & E85 Ethanol Blends in Non-Flex-Fuel Vehicles and Flex-Fuel Vehicles in Louisiana

 

Gainesville, FL (February 11, 2009) – The U.S. Environmental Protection Agency has granted a testing exemption to Renergie, Inc. Under the test program, the first of its kind in the U.S., Renergie will use variable blending pumps, not splash blending, to precisely dispense hydrous ethanol blends of E10, E20, E30, and E85 to test vehicles for the purpose of testing for blend optimization with respect to fuel economy, engine emissions, and vehicle drivability. Sixty vehicles will be involved in the test program which will last for a period of 15 months.

Hydrous Ethanol

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.

Variable Blending Pump

In the U.S., the primary method for blending ethanol into gasoline is splash blending. The ethanol is “splashed” into the gasoline either in a tanker truck or sometimes into a storage tank of a retail station. Renergie believes the inaccuracy and manipulation of splash blending may be eliminated by precisely blending the ethanol and unleaded gasoline at the point of consumption, i.e., the point where the consumer puts E10, E20, E30 or E85 into his or her vehicle. A variable blending pump would ensure the consumer that E10 means the fuel entering the fuel tank of the consumer’s vehicle is 10 percent ethanol (rather than the current arbitrary range of 4 percent ethanol to at least 24% ethanol that the splash blending method provides) and 90% gasoline.

Team Approach

“On June 21, 2008, Governor Bobby Jindal signed into law the Advanced Biofuel Industry Development Initiative (“Act 382”), the most comprehensive and far-reaching state legislation in the nation enacted to develop a statewide advanced biofuel industry. Act 382 is based upon the “Field-to-Pump” strategy developed by Renergie.  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,” said Meaghan M. Donovan, founder of Renergie, Inc. “We are excited and proud that Renergie, the Louisiana Department of Agriculture & Forestry, the Louisiana Department of Environmental Quality, and the U.S. Environmental Protection Agency are acting as a unified team to develop a network of small advanced biofuel manufacturing facilities and the necessary fueling infrastructure throughout Louisiana. Representative Jonathan W. Perry (R – District 47), Senator Nick Gautreaux (D – District 26), and Dr. Mike Strain, Commissioner of the Louisiana Department of Agriculture and Forestry, should be praised for their leadership on this issue. Renergie’s decentralized network of small advanced biofuel manufacturing facilities reduces Renergie’s feedstock supply risk, maximizes rural economic development, maximizes job creation in the state and does not burden local water supplies.

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. By blending fuel-grade ethanol with gasoline, via blending pumps at its gas stations, Renergie will offer the consumer a fuel that is renewable, competitively-priced, cleaner, and more efficient than unleaded gasoline in the form E10, E20, E30 and E85.”

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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Petroleum Marketers, Refiners Battle Over Ethanol in Southeast

Posted on June 8, 2009. Filed under: Blender's Tax Credit, Field-to-Pump | Tags: , , , |

Petroleum marketers, refiners battle over ethanol in Southeast

By Ryan C. Christiansen

Ethanol Producer Magazine

July, 2009

Petroleum marketers in the southeastern U.S. are supporting efforts to force oil refiners to supply them with unblended gasoline so that the marketers can choose to blend ethanol into the gasoline themselves.

According to petroleum marketing groups, their inability to obtain unblended gasoline from refiners is a growing problem. “It’s being clamped down,” said Sherri Cabrera, vice president of the Petroleum Marketers Association of America, a federation of 47 state and regional trade associations representing approximately 8,000 independent petroleum marketers nationwide. “We’re seeing just more and more refiners offering [unblended gasoline] less and less.”

The issue so far appears to be most prevalent in the southeastern U.S., where North Carolina, South Carolina, Tennessee and Georgia have all either pursued legislation or passed laws to address the issue.

In South Carolina, legislators passed a law in June 2008 which required oil refiners to supply marketers with unblended gasoline. The law was bundled with provisions for sales tax exemptions for energy efficient products and for a sales tax holiday for firearms. The American Petroleum Institute and BP Products North America Inc. sued, claiming the law violated the “one subject” provision in the state constitution which states that “every act or resolution having the force of law shall relate to but one subject, and that shall be expressed in the title.” The state’s Supreme Court agreed. In May 2009, the court repealed the law.

Meanwhile, legislators in Tennessee pursued similar legislation this spring. Petroleum refiner and marketer Valero Energy Corp. reacted by threatening to shut down its Memphis, Tenn., refinery, claiming the company would need to spend up to $150 million over two years for new equipment to comply with the proposed law.

In North Carolina, the National Petrochemical & Refiners Association, a lobbying group of which Valero is a also a member, sued the state for passing a law that requires refiners to sell unblended gasoline to marketers, allowing marketers to be “blenders of record” and obtain federal tax credits for blending ethanol into gasoline. The NPRA said North Carolina’s law “conflicts with federal law by preventing entities with a federal obligation to blend renewable fuels from doing so, and by requiring them to sell unblended fuel to entities that are not obliged by federal or state law to use renewable fuels.”

Cabrera said petroleum marketers have a lot invested in tanks and infrastructure for blending ethanol with gasoline. “Refiners have tried to lock their business partners—petroleum marketers—out of the option to do that,” she said. “So some states have come in to say to refiners, ‘we’re going to make you do the right thing and work with your marketer business partners.’”

The ethanol industry is supportive of petroleum marketers and their efforts to secure ethanol blending opportunities. “In the history of ethanol, there have always been a number of petroleum marketers that want to do their own splash blending,” said Greg Krissek, board member of industry group Growth Energy. “Where this is an issue for petroleum marketers, we would be supportive of them wanting to have the clear, unblended streams.”

Krissek said the ethanol industry can be a partner in the effort to ensure marketers continue to have ethanol blending opportunities. “In a number of states, you have plants that have good relationships with the petroleum marketing organizations,” he said, “and this is an area where we can probably work together.”

 

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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Northwest’s Biofuel Boom Goes Bust

Posted on June 6, 2009. Filed under: Advanced Biofuel, Field-to-Pump | Tags: , |

Northwest’s biofuel boom goes bust

by Scott Learn

The Oregonian

June 05, 2009

 

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Jay Holthus is the plant manager at Pacific Ethanol’s Boardman plant, still operating despite a recent Chapter 11 bankruptcy filing.

In two short years, the Northwest has gone from biofuels boom to biofuels bust.

The boom began in August 2007, when Imperium Renewables opened a 100 million-gallon-a-year biodiesel plant near Grays Harbor, Wash. A month later, Pacific Ethanol opened a 40 million-gallon corn ethanol plant in Boardman. In June 2008, Cascade Grain opened a 113 million-gallon corn ethanol plant in Clatskanie.

Encouraged by tax breaks and Oregon and Washington standards designed to require biofuels’ use, the companies promised environmental benefits on an industrial scale, a quantum leap from smaller-scale producers making fuel from cooking grease and Northwest crops. Nearly 30 more projects were under discussion.

Then came this year.

In January, Cascade Grain filed for bankruptcy six months after it opened, idling its plant and putting a $20 million loan from the state of Oregon in jeopardy. Imperium, whose grand opening was attended by both Washington senators, idled its Grays Harbor plant indefinitely, laying off 24 workers in March.

And Pacific Ethanol, which received $14.6 million in Oregon tax credits for its plant, filed for bankruptcy for five of its subsidiaries last month, including the subsidiary that owns its Boardman plant. It warned that it has enough money to continue operations only through June.

U.S. Ethanol had plans to open Washington state’s first industrial-scale ethanol plant in Longview last summer. That plant is “continuing to develop,” the company says, but it is not providing a new opening date.

OREGONIAN TEMPLATEClick image to enlarge

 

Biofuel supporters expect the industry to rebound quickly once the economy turns, fueled by federal requirements for increased biofuel use.

But the boom-to-bust cycle — coupled with increasing scrutiny of the green payoff from industrial-scale biofuels — has raised more concerns about the stability of the industry and the wisdom of subsidizing it.

Federal tax credits of 45 cents a gallon for ethanol blenders mean taxpayers were set to pay about $50 million a year to subsidize fuel from Cascade Grain’s plant, or about $625,000 annually for each of the 80 jobs promised there. That doesn’t count the Oregon loan, roughly $15 million in state tax credits or local tax breaks.

Last year, the U.S. produced more than 9 billion gallons of biofuels, almost all corn ethanol, using a quarter of the nation’s corn crop. The fuel displaced enough petroleum gasoline to power 2.1 million cars. But it reduced greenhouse gas emissions from the U.S. transportation sector by less than 1 percent, the Congressional Budget Office estimates.

“There are big questions about whether (biofuels) are really helping in terms of improving energy security and reducing fossil fuel use,” said William Jaeger, an Oregon State University economist who has studied biofuels. “Given all the deficit spending we’re doing, we should be even more conscious of what bang we’re getting for our buck.”

 

Widespread downturn

Industry leaders counsel patience for a relatively young industry in the midst of an economic downturn.

Higher biofuel content requirements in California and at the federal level will help the industry recover, they say, paying taxpayers back through new jobs and tax payments. Federal requirements call for boosting biofuel use fourfold by 2022, to 36 billion gallons a year.

Technology will provide fuels with deeper environmental benefits.

Construction of the Northwest’s hydropower dams was subsidized by the federal government, noted John Plaza, Imperium’s president and founder. Coal, nuclear and oil exploration are subsidized, with oil benefiting from research and development expenditures and low-cost land rights for mining.

“Every form of energy has been facilitated in one way or the other by the government,” Plaza said. “Biofuel is no different.”

Democratic leaders echo the industry’s sentiments. Earlier this month, President Barack Obama offered loan guarantees and other financial help to struggling ethanol producers. David Van’t Hof, Gov. Ted Kulongoski’s sustainability adviser, calls Oregon’s fuel plants a “bridge” to more advanced biofuels.

The biofuel downturn has been a national phenomenon, Van’t Hof noted. Oregon’s plants are likely to be restructured under Chapter 11 proceedings or sold, not shuttered. And the federal plans for more biofuel use in coming years leave Oregon in a good position to capitalize as the industry grows, he said.

Efforts in the Legislature to curb Oregon’s business energy tax credits, which include tax breaks for biofuel producers, appear to have vaporized. Same goes for calls to eliminate Oregon’s aggressive 10 percent ethanol content standard. A bill that should guarantee that a 2 percent biodiesel content standard kicks in soon is faring well so far.

“It’s unfortunate the hiccup we’re going through,” Van’t Hof said. “But we still think it’s the right place to be moving, and we’re still ahead of the game.”

 

Oregon’s advances

Oregon’s big leap into biofuels came in 2007, when the Legislature passed nation-leading rules designed to boost biofuel production and trigger 10 percent content standards for ethanol and 2 percent for biodiesel.

The legislation, which also provided tax breaks for farmers and refineries, passed handily, appealing to environmentalists, farmers and rural legislators seeking badly needed jobs in their districts.

At the same time, the federal government was increasing its commitment to biofuels, and Portland kicked in its first-in-the-nation biofuel requirements, calling for 10 percent ethanol and 5 percent biodiesel blends in fuels sold in the city.

All that activity prompted a rush to expand capacity, with companies borrowing heavily to pay for plant construction.

 

OREGONIAN TEMPLATEClick image to enlarge

 

Then the economy plunged, drying up investment and driving down prices for petroleum gasoline. Lower gas prices reduced the price that refineries would pay for ethanol and biodiesel. That dramatically narrowed the spread between biofuel prices and prices for Midwest corn, canola and other biofuel feedstocks, prompting plant closures nationwide.

“Oil dropped, the demand for gasoline dropped, and that made for a tremendous struggle,” said Chuck Carlson, Cascade Grain’s president.

Cascade also was hurt by a dispute with its construction contractor, who has placed a lien against the property that Carlson said takes legal priority over Oregon’s loan. A valuation for bankruptcy court puts the plant’s worth at about $56 million at most, though debt, including Oregon’s $20 million loan, totals roughly $120 million.

Pacific Ethanol officials wouldn’t comment on their subsidiaries’ bankruptcy filings. But Tom Koehler, the company’s policy adviser, said it’s not time to lose faith in biofuels. Along with electric cars, they’re the best bet for reducing the country’s reliance on foreign oil.

“Sure, business is cyclical,” Koehler said. “But we put steel in the ground, and this plant will continue to provide renewable fuels for a long time to come.”

Smaller players, including Oregon’s SeQuential Pacific Biofuels, will benefit if the state’s biodiesel content requirement kicks in. SeQuential uses a lot of used cooking grease, which has a limited supply but few environmental questions.

 

Next generation

The bigger players have bigger problems.

After years of not tying biofuel subsidies to environmental standards, the U.S. Environmental Protection Agency and California have proposed standards that would take biofuels’ “life cycle” footprint into account. Oregon’s Legislature may follow suit.

 

OREGONIAN TEMPLATEClick image to enlarge

 

In California’s “low carbon fuel standard,” life cycle effects — including the power used to produce biofuel, the use of petroleum-based fertilizer and displacement of forests as land is used for biofuels — give average Midwest ethanol a worse carbon profile than the state’s petroleum gasoline.

The EPA’s proposed standard assumes that corn ethanol reduces emissions over 30 years by 18 percent if the refinery is fired by natural gas — and increases the emissions by 34 percent if it’s fired by coal. Soy-based biodiesel, the main type, increases emissions 4 percent over 30 years compared with conventional diesel, the agency estimates.

The industry disputes those findings. But the move toward life cycle analysis has increased pressure to get to the next generation of biofuels.

The Obama administration plans to use nearly $800 million in stimulus money to pay for research into alternative fuels. The federal government’s biofuel mandates call for 21 billion gallons a year of advanced fuels — those that cut greenhouse emissions by half or more — by 2022.

In Oregon, ZeaChem plans a 1 million-gallon biofuel demonstration plant in Boardman. ZeaChem plans to take fast-growing poplar trees from a nearby 17,000-acre tree farm owned by GreenWood Resources of Portland, then convert them to ethanol using microbes found in termites.

Woody “cellulosic” feedstocks — from trees to switch grass to forest slash — are not food crops, don’t require fertilizer and can grow on marginal lands. As feedstocks, they should be more stable in price than food crops such as corn and soybeans.

Jaeger, the OSU economist, is skeptical: Advanced biofuels won’t make a big dent in fuel use within 10 or perhaps 20 years, he said. They also cost more to process than first-generation biofuels.

“We should be careful not to be motivated by wishful thinking,” said Jaeger, who favors a more straightforward tax on carbon — some in Congress have suggested offsetting it with payroll tax cuts — to get to emissions reductions.

ZeaChem CEO Jim Imbler said the company’s fuel will have 12 times the energy content that went into producing it and needs far less land than corn ethanol. Its investors include Valero Energy, the largest oil refiner in the United States.

ZeaChem plans to open the demonstration plant in Boardman in 2010, with construction on a full-scale plant as early as 2012. The company can compete with oil at $50 a barrel, Imbler said, but “a lot is dependent on state and federal help for the first few plants.”

 

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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    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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