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DF Cast: What’s in the Farm Bill for Biofuels?

John Davis

The U.S. Senate has passed its version of the Farm Bill… or as Secretary of Agriculture Tom Vilsack likes to call it by its more proper name, Agriculture Reform, Food, and Jobs Act of 2012, because of its all-encompassing nature (he even “fines” people in his office $1 for every time they give the shortened, less encompassing name)… and it is off to the House for consideration sometime after the 4th of July break.

In this edition of the Domestic Fuel Cast, we hear about some of the programs seen as good for renewable energy that survived in the Senate’s version of the bill, as well as comments from some key lawmakers and Vilsack on the importance of these provisions.

You can listen to the Domestic Fuel Cast here: Domestic Fuel Cast

You can also subscribe to the DomesticFuel Cast here.

Audio, Biodiesel, biofuels, Domestic Fuel Cast, Ethanol, Government, Legislation

China Drops Anti-Dumping DDGS Case

Cindy Zimmerman

China‘s commerce ministry is ending an 18-month anti-dumping investigation into imports of the ethanol co-product distillers dried grains (DDGS), offering the opportunity to bring U.S. exports back up as it means no anti-dumping tariffs will be imposed.

China’s imports of DDGs dropped by nearly half last year compared to 2010 when they topped 2.5 million metric tons, up 385 percent over the previous year. U.S. Grains Council President and CEO Tom Dorr says U.S. exports to China have already shown an increase this year over last in anticipation of this decision. “Imported DDGS from the U.S. the first four months, January through April of 2012, are up about 84% over 2011,” Dorr said in a press conference this morning. “We think people were sensing that this may be the outcome and were willing to take the risk that there probably would not be tariffs imposed.”

Dorr gave special recognition to Ray Defenbaugh, President and CEO Big River Resources, for his help during the investigation. “One of his plants was selected for the investigation phase of the case,” said Dorr. “He was very supportive of dealing with this issue head-on which helped everyone.” The three plants originally chosen for the investigation were Big River, United Wisconsin and Golden Grain.

Distillers Grains, Ethanol, Ethanol News, USGC

Peterson Skeptical of Cellulosic Ethanol

John Davis

The ranking member of the House Agriculture Committee has doubts about whether cellulosic ethanol will ever be commercially viable.

“I just don’t think that cellulosic will ever be commercialized,” Congressman Collin Peterson said during an interview with Domestic Fuel reporter Chuck Zimmerman after he talked to members of the American Seed Trade Association meeting in Washington Wednesday. “And it’s become a problem. I mean, the Solyndra thing … it’s become politicized.”

Peterson said he believes algae has some potential, but with too many alternative energy plans, the economics don’t work without government support. And he points out that the government is broke.

Peterson said the House Ag Committee will be marking up the Farm Bill the week after the 4th of July. It will be interesting to see which renewable energy measures he supports in the Senate’s bill and which ones survive the process.

Listen to Chuck’s conversation with Peterson here:
Rep. Collin Peterson interview

algae, Audio, Cellulosic, Ethanol, Ethanol News

Importance of Fuel Quality Management

Cindy Zimmerman

Maintaining the quality of fuel stored commercially or on the farm has a lot to do with making sure the storage equipment is keeping the fuel clean and dry.

That’s why GROWMARK’s energy division stresses good storage tank maintenance to farmers. “Engine manufacturers as far back as the 1930s said the number one thing to do with all fuel is to keep the fuel dry and clean,” said Ken Reichert, GROWMARK Refined and Renewable Fuels Sales Manager. “That’s even more true now and critically true for today’s engines.”

Reichert notes that today’s diesel engines in particular have fuel injection systems that utilize very tight tolerance on the injectors that are electronically controlled. “So they just can’t tolerate any foreign material, oxidized fuel or water, getting into the system,” he said.

GROWMARK has found that there are lots of on-farm and commercial storage tanks that are decades old, which can lead to contaminants that naturally occur over time, but Reichert says the increasing use of biodiesel blends does not require any type of special handling. “In general, biodiesel is the same of any other fuel as far as managing quality, protecting it from dirt and water,” he said.

Reichert says GROWMARK and the FS System recently introduced the latest formulation of their flagship fuel, Dieselex Gold, which deals with the tighter injection tolerances and updates the oxidation inhibitor, something that is especially important with biodiesel blends. “Biodiesel has a little less oxidative stability than regular diesel,” said Reichert. Dieselex Gold also has a demulsifier to help fuel shed out of water faster, which helps if water gets in a tank.

Listen to my interview with Ken Reichert here: Interview with Ken Reichert, GROWMARK

Audio, Biodiesel, GROWMARK

Death of Ethanol-Killing Amendment Welcomed

John Davis

A measure that would have killed ethanol and other renewable energy programs under the Farm Bill was stopped today in Washington, D.C. Senator Pat Toomey’s amendment to the Farm Bill that would have repealed the Biorefinery Assistance Program went down to defeat in a bipartisan 63-33 count. The vote was welcomed by Growth Energy CEO, Tom Buis:

“The Biorefinery Assistance Program is instrumental in the production of the next generation of ethanol. This program is in place to foster innovation and American excellence. By rejecting this amendment, the Senate has clearly shown they understand the importance of advanced biofuels and the benefits of cleaner air, job creation and energy security.

“American made ethanol is critical to reducing our addiction to foreign oil and vital, if we are serious about energy independence. Not only does ethanol contribute to our energy security, but its production spurs economic growth, creating jobs and revitalize areas that are lacking in economic opportunity.”

Buis urged House members to follow the Senate’s lead in supporting renewable energy measures in the Farm Bill.

Ethanol, Ethanol News, Government, Growth Energy

Will You Buy 15% Ethanol for Your Vehicle?

Melissa Sandfort

Our latest ZimmPoll asked the question, “Does Your Business Have an Interest in Pinterest?”

Our poll results: Thirty-one percent said Yes, part of our marketing plan or just figuring it out; thirty-one percent said No, no application for us; and thirty-eight percent knew nothing about Pinterest.

Our new ZimmPoll is now live and asks the question, “Will you buy E15 for your MY2001 or later car if it’s offered?” The EPA has given its approval for the first retailers to sell 15% ethanol blended fuel. E15 is a legal fuel for sale to cars, pickups and SUVs made since 2001. Here’s some more background on E15. Sales could start this week in Iowa, Illinois and/or Kansas. What do you think?

ZimmPoll is sponsored by Rhea+Kaiser, a full-service advertising/public relations agency.

ZimmPoll

G20 Blasted for Not Lowering Oil Subsidies

John Davis

As the G20 summit wraps up in Mexico and many of the members head off to the United Nations Conference on Sustainable Development in Rio de Janeiro, Brazil, the group is being blasted for its failure to reduce the amount of subsidies for crude oil. This press release from the Global Renewable Fuels Alliance (GRFA) says a new Oil Change International report shows that oil subsidies are expected to double to $660 billion by 2020:

“It is not surprising that the G20 has been unsuccessful in reducing fossil fuel subsidies when 9 months ago the IEA stated that oil subsidies were set to more that double in only a decade’s time,” said Bliss Baker, spokesperson for the Global Renewable Fuels Alliance.

“The GRFA has repeatedly called on G20 leaders to shift their policy focus from subsidizing oil consumption towards developing biofuel – friendly policies that are proven to reduce our crippling reliance on fossil fuels. Currently, according to the Institute for Energy Research, oil subsidies completely dwarf any economic incentives to promote renewable fuels – this must change” stated Mr. Baker.

“The failure to reduce oil subsidies highlights the stranglehold oil companies have on our domestic energy policies. The G20 needs to do more to eliminate these staggering subsidies to the wealthiest industry on the planet,” added Mr. Baker.

The press release goes on to say that G20 nations have been more focused on changing their definitions of subsidies than their policies towards them.

Government, International, Oil

Poor Market Closes Valero Nebraska Ethanol Plant

John Davis

High prices for corn and low margins for ethanol have forced Valero to temporarily close its Albion, Nebraska ethanol plant. But as you can see from this statement I just received this morning from Valero spokesman Bill Day, company officials expect the plant to be back up and running soon:

Yesterday morning the Valero Renewables-Albion ethanol plant temporarily halted production due to poor market conditions. We will restart production when margins improve, expected to be well before the harvest. At this point Albion is the only plant among Valero Renewables’ 10 ethanol plants that has halted production, but we continue to closely monitor market conditions throughout the Valero Renewables system. All employees at Albion remain on the payroll and will maintain the plant to be ready to restart when conditions improve.

Valero is not alone in its problems with tight margins for ethanol in Nebraska. This Reuters article says that last week that Nedak Ethanol LLC will also temporarily close its 44-million-gallon-per-year ethanol plant in Atkinson, Nebraska. The news comes as USDA reports corn supplies will be at a 16-year low by the end of the summer.

Ethanol, Ethanol News

Brazil Boasts Successful Biofuels Flight

Joanna Schroeder

Amyris, Inc. provided a renewable jet fuel blend derived from Brazilian sugarcane to Azul Brazilian Airlines who boasted a successful test flight. The Embraer E195 jet took flight from Campinas Viracopos Airport, flew over Rio De Janeiro, where the U.N. Conference for Sustainable Development (RIO +20), and landed at Rio’s Santos Dumont Airport.

Known as Azul+Verde (“a greener blue” in Portuguese), this project began in November 2009 with the goal of developing a cleaner, greener fuel as an alternative to fossil fuels.

“Azul’s commitment to reducing our dependency on volatile petroleum products goes beyond reducing our costs. The main objective is to innovate in our service offerings, using the best technologies to reduce our carbon footprint as well as raise awareness among our customers that they are not just choosing an airline that is merely concerned about the environment but is taking steps to preserve it,” said Flavio Costa, Chief Operating Officer of Azul Airlines.

A lifecycle analysis and sustainability study developed by a Brazilian think-tank, Institute for International Trade Negotiations (ICONE), indicates that the Amyris renewable jet fuel could reduce greenhouse gas emissions up to 82%, when compared to convention fossil-derived jet fuel.

“Amyris’s renewable jet fuel has been designed to be compliant with Jet A/A-1 fuel specifications. To that end, we have successfully undertaken a series of tests that measure its performance,” said John Melo, President & Chief Executive Officer of Amyris. “This demonstration flight caps a major milestone in our jet fuel program and allow us to pursue our certification and commercialization goals,” Melo concluded.

advanced biofuels, biojet fuel

Growth Energy CEO Talks Fuels, Engines & Ethanol

John Davis

Figuring out how to solve the energy challenges of today and the future was the topic of the the “Next Generation Engines and Fuels Forum,” and, no surprise, Tom Buis, the CEO of Growth Energy… a group that promotes ethanol and the people who produce it… was part of the discussion of the importance of renewable fuel and ethanol:

“The energy challenges we face as a nation are complex, and as we move forward, we need to look to combine the best performance possible between fuels and vehicles that will meet the upcoming CAFÉ standards, while at the same time acting as responsible stewards to our environment. To that end, all stakeholders, from those that produce fuel and engines must work in a collaborative manner in the development of the next generation of fuel and vehicles,” stated Buis.

Buis added that designing engines to operate on higher blends of ethanol is critical for the ethanol and engine industries.

“If the invested parties work in a uniform, transparent and predictable manner, we can easily address the growing demand for an abundant and reliable source of energy for the future.”

Growth Energy