There is something new under the sun.
Massachusettes-based SunEthanol has changed its name to Qteros, after its Q microbe technology, which may be a key to commercializing cellulosic ethanol.
The company has raised $25 million from a diverse group of investors in a Series B round of financing. Among the investors are British Petroleum (BP) and a management group led by billionaire George Soros.
The Brazilian ethanol industry will remain the fuel sponsor of the Indy Racing League in 2009, but the ethanol will come from the United States – at least for the first year.
That is a compromise of sorts announced by IRL after meeting with corn ethanol industry representatives.
The multi-year partnership between the IndyCar Series and APEX-Brasil — a trade promotion agency that will be the official ethanol supplier to the series beginning in 2009 – includes cooperation from UNICA (the Brazilian Sugarcane Industry Association) to identify those interested in supplying ethanol.
Initially, UNICA will look to partner with a U.S. company to supply the IndyCar Series with American-produced corn-based ethanol.
Corn growers are other domestic ethanol interests are unhappy with the Brazilian deal, but ultimately it came down to a decision by the Ethanol Promotion and Information Council (EPIC) to not sponsor the racing series for the next season. EPIC is “ceasing operation,” as the IRL statement notes, in that it will no longer exist as EPIC but as part of the newly formed Growth Energy group. However, the decision to stop sponsorship was made independently of that new direction – not just because it was expensive, but also because it had essentially served it’s purpose in proving ethanol as a performance fuel.
Terry Angstadt, president of the commercial division of the Indy Racing League, said they made the deal with Brazil because “No one from any other part of the American-based ethanol community stepped forward with a substantial proposal” although several other producers reportedly offered their services as suppliers last week.
Angstadt says opportunities still exist for American ethanol companies and organizations to continue involvement in the IndyCar Series. “We look forward to working with American producers and Brazilian producers of ethanol to promote ethanol as a renewable energy source and part of the solution to lessen the United States’ reliance on Middle Eastern oil,” he said.
Thousands of corn growers from across the Midwest could potentially have their contracts with ethanol producer VeraSun rejected, including the chairman of the National Corn Growers Association (NCGA).
NCGA chairman Ron Litterer of Iowa and others have filed a formal objection with the U.S. Bankruptcy Court in Delaware regarding the proposed disposition of corn contracts by VeraSun Energy Corporation, which filed Chapter 11 at the end of October.
VeraSun announced recently that they are continuing to work with suppliers while pursuing long-term financing.
“Unfortunately, the Company will need to reject some corn contracts for delivery through Dec. 31, 2008 at our Janesville and Welcome, Minn., facilities due to the delayed startups. Other contracts may need to be rejected or renegotiated as we continue to work through them on an individual basis.”
The objection filed by the corn growers indicates specific concerns with VeraSun’s proposed procedures under bankruptcy, which may allow VeraSun to wait until 10 days before contracted delivery date to notify growers of their rejection of the contract. This would essentially leave corn suppliers in a state of limbo while VeraSun is free to determine the market price for corn before deciding whether to accept deliveries under a contract or summarily reject the contract. Litterer believes this would be fundamentally unfair to corn growers and other corn suppliers.
The world’s largest ethanol producer could be getting even bigger soon.
Speculation is that POET is behind a potential buyout of VeraSun Energy Corporation, which filed Chapter 11 less than a month ago. VeraSun announced this week that it received a “non-binding unsolicited indication of interest with respect to the purchase of substantially all of its assets.”
Both POET and VeraSun are citing confidentiality considerations for not naming names, but POET CEO Jeff Broin said in a statement that they are “in serious discussions with a couple of ethanol producers regarding possible acquisitions.”
“POET remains profitable despite the current economic challenges facing the ethanol industry thanks to careful risk management and proprietary technology that makes our process for producing ethanol extremely efficient,” said Broin. “These potential acquisitions have met our initial criteria, and we will continue discussions to determine whether the plants are the right fit for our company.”
The Ethanol Promotion and Information Council is joining with the newly-formed Growth Energy group.
EPIC Executive Director Toni Nuernberg made the official announcement today that the organization’s board of directors is recommending a transition plan to the membership for the two groups to combine.
“The mission of EPIC’s formation— growing ethanol awareness through public relations, marketing and promotions — will continue as a core platform of Growth Energy’s initiatives,” said Nuernberg in a statement. EPIC’s programs and staff will be transitioning into Growth Energy over the next few months.
Growth Energy was announced earlier this month as a new ethanol organization formed by the same principals who started EPIC in 2005, “committed to the promise of agriculture and growing America’s economy through cleaner, greener energy.”
The third annual Cellulosic Ethanol Summit was held this week in Coral Gables, Florida and Renewable Fuels Association president and CEO Bob Dinneen was once again chairman of the summit.
In this “Ethanol Report” podcast, Dinneen discusses a number of issues – including the race to commercialize cellulosic ethanol, the new administration, getting more flex fuel vehicles on the road, the continuing attacks from the food industry, and the all important land use issue.
You can listen to “The Ethanol Report” on-line here:
Or you can subscribe to this podcast by following this link.
The domestic ethanol industry is pleading with the Indy Racing League to reconsider the decision to make Brazil the official ethanol supplier for the 23 IndyCar Series races.
In a letter to IRL commercial division president Terry Angstadt this week, Renewable Fuels Association President Bob Dinneen implored the IRL to “at least ensure that the Indianapolis 500 be run on American homegrown ethanol and suggested the league need look no further than the network of ethanol producers in the state of Indiana.”
Earlier this week, IRL announced a multi-year partnership with APEX-Brasil making the trade promotion agency the official ethanol supplier to the IndyCar Series beginning with the 2009 season. The deal includes cooperation from UNICA (the Brazilian Sugarcane Industry Association) to identify those interested in supplying ethanol to the series. Initially, UNICA will look to partner with a U.S.-based ethanol company to supply the IndyCar Series with corn-based ethanol.
“The move to other sources of ethanol is a natural progression as the ethanol industry continues to grow and evolve,” said Angstadt. “We continue to strive to be on the leading edge of the greening of racing. The IndyCar Series was the first motorsports series to mandate use of a renewable fuel, and now we will work with the ethanol industry in both the United States and Brazil to promote the use of all types of ethanol by consumers.”
Reportedly, the new agreement with Brazil does include an exception for the Iowa Corn Indy 250 to use domestically produced corn ethanol, but no exception for the Indy 500.
At the same time Florida was hosting the third Cellulosic Ethanol Summit in Coral Gables this week, U.S. Sugar announced an agreement with Coskata to explore building a 100 million gallon per year cellulosic ethanol facility in Clewiston, Florida. The facility would be the world’s largest second generation ethanol facility, converting left-over sugar cane material into ethanol.
That is great news for the relatively young Florida Biofuels Association, which helped to host the summit in south Florida.
“We launched in May of 2007 so we are a pretty new organization,” said FBA Executive Director Dana Weber. “We’re focused primarily on a sustainable, clean and safe biofuels sector here in Florida.”
Weber says Florida has an extremely positive environment for biofuels growth. “We’ve got a very aggressive governor who has put some pretty strong policies in place with regards to climate change and alternative energy.”
You can listen to an interview with Dana Weber here:
See photos from the Cellulosic Ethanol Summit here.
Secretary of Agriculture Ed Schafer spoke to the Cellulosic Ethanol Summit Wednesday in Florida and outlined all the advancements being made in biofuels and the potential for the industry in the future. “Nobody is talking about us going backward,” Schafer said, then quickly corrected himself, saying “almost nobody,” noting that the Grocery Manufacturers Association and some others would like to see the industry move backward.
Speaking to members of the media after his speech, Schafer said the group that held a press conference yesterday calling for an end to ethanol subsidies “stood up there with no credibility whatsoever,” when they claimed that it will take 18-24 months for the lower commodity prices to bring food prices back down. “I just think that they are totally off base,” Schafer said. “They are trying to justify the increased cost and increased profits that they’re making at the expense of another industry and that’s just not appropriate.”
Schafer left the summit for Brazil to lead the U.S. delegation at an International Conference on Biofuels in Sao Paulo this week. “Seventy-five countries are going to be there,” Schafer said. “Our effort is to come together between the US and Brazil as the world’s two leading biofuels producers and look at regional and global approaches to bioenergy.”
Schafer also announced at the conference that applications are now being accepted for loan guarantees under the Biorefinery Assistance Program of the 2008 Farm Bill. The Biorefinery Assistance Program is designed to promote the development of new and emerging technologies for the production of advanced biofuels.
You can listen to some of Secretary Schafer’s comments to the press here:
The ethanol industry wasted no time fighting back today against another attack by the food industry to blame higher prices on ethanol production.
The newly-formed Growth Energy called on the Grocery Manufacturers Association (GMA) to “discontinue its deceptive attacks on the government’s investment in ethanol and other renewable fuels.” Growth Energy held a press conference shortly after the group “Food Before Fuel,” which is back by GMA, held a press conference calling for an end to all ethanol “subsidies.”
Growth Energy members in turn pointed out that the food companies themselves have been the beneficiary of subsidies, such as the $55 billion being spent this year on federal food assistance programs. “The federal government has an important role in supporting programs that promote the common good,” said Dave Vander Griend, President & CEO of ICM, Inc. and board member of Growth Energy. “Whether by funding anti-poverty programs like food stamps or championing renewable energy that will jumpstart our green economy and create jobs, we believe that it is good public policy to make smart investments for our nation’s future.”
The “Food Before Fuel” group called the press conference today as the “30th anniversary of ethanol subsidies” and referred to ethanol as “30-year-old under employed child” living in our basement. During the Cellulosic Ethanol Summit in Florida, Renewable Fuels Association president Bob Dinneen said, “It’s a cute analogy but the problem is there’s somebody else living in that house and it’s the 120-year-old oil industry that continues to be subsidized,” as well as other energy industries. “There is not a single energy market today that is not heavily subsidized by the government because energy is so darn important to every nation’s economy.”
The National Corn Growers Association was outraged by the attack, which was focused only on corn ethanol. “These same ethanol critics are the ones who virtually promised to reduce food prices immediately, and have failed to do so, even though corn prices and energy prices are down by more than half in the last few weeks,” National Corn Growers Association president Bob Dickey said.