Ethanol Groups Order Injunction on California LCFS

Cindy Zimmerman

A coalition of ethanol and agriculture groups, including the Renewable Fuels Association (RFA) and Growth Energy, have filed a brief urging the U.S. 9th Circuit Court of Appeals to uphold a court-ordered injunction on the low-carbon fuel standard (LCFS).

At issue is California’s request for a stay of the injunction issued by District Court Judge Lawrence J. O’Neill when he ruled in December that the new fuel regulation issued by the California Air Resource Board (CARB) violated the Commerce Clause and was therefore unconstitutional.

In the brief filed Thursday night with the Ninth Circuit, RFA and Growth Energy argue that staying Judge O’Neill’s injunction would harm and disrupt the Midwest ethanol industry, but would not appreciably advance the goals of the LCFS. Growth Energy and RFA provided extensive evidence that Midwest ethanol producers have already been shut out of the California market, and that the LCFS has caused inefficient “shuffling” of fuel previously sold in California to other markets, and vice versa. While the LCFS has come at great cost to the ethanol industry, it has produced no environmental benefits.

Growth Energy CEO Tom Buis and RFA CEO Bob Dinneen issued a joint statement to the press in response to questions about the case:

“We are hopeful that the Ninth Circuit Court will see the merits of our argument to uphold Judge O’Neill’s injunction. Ultimately, we believe California’s low carbon fuel standard should be designed and implemented in a fair and legal manner. If we are going to have a low-carbon society, we need to have a low-carbon fuel. Ethanol is the only commercially-viable, low-carbon fuel we have today.”

The two ethanol associations joined in December 2009 to file a lawsuit seeking to stop the LCFS because it would discriminate against Midwest ethanol producers, blocking them from selling clean, renewable ethanol into the California market.

Ethanol, Ethanol News, Growth Energy, RFA

Andersen Windows Converts Fleet to Natural Gas

Window-maker, Andersen Corporation, will begin converting its transportation fleet to use compressed natural gas (CNG), reducing both operating costs and carbon dioxide emissions for the company. A new fueling station, located at the Cedar County Cooperative Cenex near the company’s plant in Menomonie, Wis., will provide the alternative fuel for Andersen.

The conversion of the first seven trucks to CNG is expected to reduce emissions by 28 percent per year. The total savings that Andersen will gain will range between $1.25 and $1.75 per gallon, depending on the market price of diesel. Each truck will be able to achieve about 60 diesel gallon equivalents at 5.7 mpg, yielding a potential range of 342 miles per truck between fueling. The company plans to add more trucks to the program to support their efforts to pursue local, cleaner energy options and reduce total emissions.

The CNG station is the result of a unique partnership between Andersen, Dart Transit Company, U.S. Oil (a division of U.S. Venture, Inc.), Breakthrough®Fuel, and Xcel Energy, and highlights a new type of market collaboration implementing this new technology. The project uses Dart Transit’s Eco Tractor™ powered by U.S. Oil’s GAIN™ CNG supply program to provide the fuel, and Breakthrough®Fuel’s fuel management process to both track the program’s results and pinpoint opportunities to make the program even more efficient. Grants from the Wisconsin State Energy Office were also awarded to support this project.

“We believe finding new ways to use alternative energy is one way to help restore economic growth for everyone, and this project shows how the rubber literally meets the road,” said Lance Whitacre, vice president, logistics at Andersen Corporation. “Leveraging this unique partnership today yields far-reaching benefits for us that improve the triple bottom line – good for people, profitable for companies and beneficial for the environment.”

Fleet, Natural Gas

Rabobank Studies Future of Ethanol for Brazil and U.S.

A report from Rabobank’s global Food & Agribusiness Research and Advisory department is looking at the future of ethanol from the perspectives of both Brazilian and United States markets.
rabobank-logo-printRabobank first points out significant changes in U.S. ethanol policy starting in 2012. The VEETC blending credit and a tax on ethanol imports both expired in December 2011 and U.S. ethanol industry groups have shifted their political weight toward initiatives like E15 and advanced biofuels.

Although these developments improve Brazil’s access to the U.S. ethanol market in 2012, the reality is that the Brazilian cane industry may struggle to fully satisfy even its own domestic demand in 2012 owing to a sharp downturn in cane production and an uncertain outlook for output growth.

Brazil became the leading importer of ethanol from the U.S. in 2011.

“Despite the expiration of the tax credit and currently negative margins, we expect U.S. ethanol production to increase slightly in 2012 as an increase in mandated levels of production offsets what we expect to be a decline in exports,” says David C. Nelson, Global Strategist for Grains & Oilseeds with Rabobank’s Food & Agribusiness Research and Advisory group. “The outlook for exports is heavily dependent upon what happens with the sugar crop in Brazil, the U.S.’s biggest export competitor. Rabobank’s outlook for higher U.S. ethanol production is also predicated on regulatory approval for E15. If E15 is adopted by just 10 Midwest states, that will alleviate current blend wall restrictions.”

Andy Duff, Global Strategist for Sugar and Head of Rabobank’s Food and Agribusiness Research and Advisory Group in Brazil, adds, “Rabobank believes that the abolition of the U.S. import tariff on ethanol represents a significant opportunity for the Brazilian cane sector in the medium to long term. However, in the next few years the focus of the Brazilian industry is likely to be keeping up with the growth of potential consumption in the domestic market, which will continue to rise as a result of expansion of the flex-fuel fleet.”

Read more of Rabobank’s future outlook for ethanol in the United States and Brazil.

Brazil, Ethanol

REG Launches New Advocacy Website

Renewable Energy Group® (REG) has a new policy advocacy website designed to centralize the company’s constituents and rally support for biodiesel policy issues.

The new site design allows supporters to sign up for informational updates and alerts and then offers an-easy-to-use platform to contact state or federal elected officials. Go online for registration and more information.

“We are urging the friends of REG—who may be vendors, customers, suppliers, partners, shareholders or family members—to sign up to receive federal and state legislative updates and calls to action,” said Scott Hedderich, REG’s Director of Corporate Affairs. “Americans have a constitutional right to make their voices heard and this site helps them utilize that right.”

REG, an active member of the National Biodiesel Board, plans to utilize the website, in part, to extend the industry’s federal policy outreach programs. With biorefineries in Iowa, Illinois, Minnesota, and Texas and additional facilities to be completed in Louisiana, New Mexico and Kansas, a nationwide logistics footprint is important to identify and build localized support.

“The biodiesel industry is facing important issues like the expansion RFS2 and the reinstatement of the federal blenders’ tax incentive in order to grow green collar job creation, create a healthy environment and expand energy security,” added Hedderich. “We have a unique opportunity to reach out to our base of business contacts and broaden the reach for biodiesel industry support.”

Biodiesel, Legislation, REG

The Andersons, Inc. to Purchase Iowa Ethanol Plant

Ohio-based company, The Andersons, Inc., will aquire an ethanol production facility in Denison, Iowa from Amaizing Energy Denison LLC and Amaizing Energy Holding Company, LLC. The transaction, which remains subject to several contingencies, is anticipated to close in the second quarter.

If acquired, the plant would be owned by The Andersons Denison Ethanol LLC, a wholly-owned subsidiary of The Andersons, Inc. The operations consist of an ethanol facility with an adjacent 2.7 million bushel grain terminal, both with direct access to two Class 1 railroads in Iowa.

“As our first ethanol plant west of the Mississippi, this facility provides us with geographic diversity into some of the best corn ground in the country,” says Neill McKinstray, President, Ethanol Group. “This purchase enables us to expand our ethanol production, marketing and services into a new region providing arbitrage and risk management opportunities with the three existing plants we manage while leveraging existing administrative staff to a fourth plant. With much of the same technology in all four plants, we expect to bring additional efficiencies to drive down our cost per gallon, and maximize returns to shareholders as we have successfully demonstrated during the past five years.”

CEO Mike Anderson, adds, “This is a well-respected, well-run organization that brings with it a solid customer base in a geographic area that we are looking forward to serving. This ethanol facility enables us to offer our grain marketing expertise and the associated services to grain producers in Iowa and fits well with our existing presence as an investor in the Iowa Northern Railway Company and our merchandising relationship with Lansing Trade Group.”

Sam Cogdill, Chairman and CEO of Amaizing Energy, says the proposed sale will address the liquidity concerns of Amaizing Energy’s membership, while retaining the economic benefits the Denison facility has in the local area.

“Our investors were committed to Amaizing Energy to earn a good return on their investment and to further local economic development and we feel great about having met both of those goals,” said Cogdill. “Placing Amaizing Energy on the market while it was a profitable operation has allowed it to reach a fair deal with a great company who we know will operate our plant properly.”

Ethanol, Facilities, Production

Cool Planet BioFuels Has Breakthrough in Production

Cool Planet BioFuels has made a major breakthrough in converting biomass to gasoline. Using giant miscanthus, an advanced bioenergy crop, the company achieved 4,000 gallons/acre biomass to gasoline conversion in pilot testing. Gasoline has about one and a half times the energy of ethanol, so this is about twelve times more yield than current corn ethanol production levels.

According to the company, the giant miscanthus was developed at the University of Mississippi and provided from a high yield plot by Repreve Renewables. Other advanced bio-energy crops, such as sorghum and switch grass, can provide similar annual yields using this new process.

“These test results are based on nearly optimal crop growth conditions and demonstrate what is possible in a good growing season. Under more routine growing conditions, we estimate yields of about 3,000 gallons/acre should be achievable throughout the Midwest by selecting the proper energy crop for local conditions,” says Mike Cheiky, Cool Planet’s founder and CEO.

Agricultural waste from food crops also can produce up to 1,000 gallons of gasoline/acre using this new technology. The process creates ultra-high surface area carbon in an intermediate step of the conversion process. Some of this carbon can be diverted to form a very potent soil enhancer which can grow more crops and sequester carbon dioxide. Although opting to divert some of the carbon to soil enhancer will reduce the current fuel output, it can generate more fertile farm land for more food and fuel production over a several year period, particularly in areas which have low land productivity today. This sequestering process gives the Cool Planet fuel a low or even negative carbon rating.

Cool Planet’s technology and its potential global impact on climate change and poverty were recently detailed in a talk at Google’s elite SolveForX Conference where 16 speakers presented innovative technologies to address the world’s biggest problems. Each of the talks was reviewed by a group of 50 top scientists, inventors and futurists invited by Google. The consensus on Cool Planet’s presentation was that the company should pursue the carbon sequestration and land productivity enhancement aspects of this technology as well as its fuel production capabilities.

Read more on the renewable cellulosic gasoline process.

biofuels, biomass, Energy

More Planting This Year

Chuck Zimmerman

In our latest ZimmPoll we asked, “What will be planted this year?” It’s that time and everyone seems to have their own idea about what it will be. 45% of respondents said More of both, 32% said More corn less soybeans and 12% each said More soybeans less corn and Less of both. USDA is estimating corn acreage will be higher this year and the highest since 1944 with soybean acres nearly the same as last year. What do you think?

Our new ZimmPoll is now live and asks the question, “Is our food system broken?” During the Bayer CropScience Ag Issues Forum one of our speakers was Gawain Kritke, Oxfam America. He told us “our food system is broken.” I think the statement was made out of frustration that we produce more food than we can eat in this country and a huge amount goes to waste. Since we don’t have a system to get waste food to those who need it they seem to believe the food system is broken. I think it’s a provacative statement and would love your thoughts.

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

ZimmPoll

NBB Raises Money for Industry Advancement

The National Biodiesel Foundation raised nearly $22,000 at its 4th Annual Silent Auction and raffle. Funding benefits outreach, education, research and demonstration activities for the advancement of biodiesel.

“The event not only provides us the opportunity to generate funding but offers a forum to promote the Foundation and showcase current activities and goals,” said Tom Verry, executive director of The Foundation. “We are pleased to see participation of donors and bidders expand over the past years. This is a further indication of the events overall success. We thank all the companies and individuals who donated or participated in the event.”

Additional accomplishments for the National Biodiesel Foundation during 2011 included:

  • • Conducted biodiesel education and training as a participant in the Alternative Fuel Trade Alliance. Specifically, this project (1) increased the number of states that enforce ASTM standards and biodiesel fuel quality; (2) achieved Automotive Service Excellence (ASE) certification for the National Biodiesel Board’s biodiesel technician training curriculum; and (3) trained Clean Cities Coordinators around the country on how to generate and capitalize on media to increase awareness of biodiesel sustainability;
  • • Coordinated and administered the Department of Energy Clean Cities grant which established biodiesel terminals and stations across the US. The primary objective of this project is to displace approximately 86 million gallons of petroleum-based diesel;
  • • Helped promote Bioheat® awareness campaign in New York City achieving significant inroads into a billion gallon heating oil market;
  • • Co-hosted the 3rd Annual Biofuels Science and Sustainability Tour, designed to educate congressional members and their staff on the Iowa renewable fuels industry.
Biodiesel, Education, NBB

Analyst Expects New Biofuels Policy in 2013

Cindy Zimmerman

A global economic analyst expects that Washington may be taking another look at biofuels policy in 2013.

bayer bill lapp“I think more of that will happen when we know more about who controls the Senate and the House, and who’s the president and where the EPA is on all this after November,” said Bill Lapp of Advanced Economic Solutions during an Ag Issues Forum sponsored by Bayer CropScience this week in Nashville who notes that the biofuels industry is facing a number of challenges. “Not only is the corn-based ethanol mandate going from 13.2 billion gallons to 15 billion, gasoline consumption has continued to decrease in the past couple of years, and we have failed miserably in meeting the goals of cellulosic production.”

Lapp suggests there may be another incarnation of the Renewable Fuel Standard. “Whether you call it RFS-2A, or whatever you want to call it, I think there has to be thought to what are we going to make those ultimate mandates,” he said. “So Congress is going to have a tremendous challenge.”

Lapp also has concerns about biodiesel production, whether the tax credit will be re-instated, and what the mandate will be for 2013.

Listen to interview with Bill Lapp here: Bill Lapp Interview

Audio, Biodiesel, biofuels, Ethanol, Ethanol News

RFS May Top Farm Bill in Importance to Corn Growers

Cindy Zimmerman

Maintaining the Renewable Fuel Standard (RFS) may be more important to corn growers than a new farm bill.

“If you took a poll of our members, and we may well do that at our Commodity Classic next week, I would say that they view the RFS as more important than the farm bill,” said National Corn Growers Association (NCGA) Vice President of Public Policy Jon Doggett during last week’s National Ethanol Conference.

Doggett says it is interesting that even other crop producers besides corn consider the RFS to be very important. “We’ve got to work together on these things, we’ve got to quit trying to figure out who’s the winner and who’s the loser because once we devolve into that kind of discussion, we all lose.”

Listen to or download Doggett’s comments here: Jon Doggett at NEC

garry niemeyerCorn growers are now gathering this week in Nashville for the Commodity Classic, and NCGA president Garry Niemeyer of Illinois says there is a lot of truth in the idea that the RFS is more important to them than the farm bill. “The Renewable Fuel Standard is really what sets the basis for where we are with ethanol,” said Niemeyer. “We’ve worked very hard to make sure that we have a very good Renewable Fuel Standard bill and it is a road map for our future with ethanol.”

At the same time, Niemeyer says they do have recommendations for farm legislation that would cost less taxpayer dollars yet still provide a safety net for growers. “We have adopted the Aggregate Risk and Revenue Management program that has been put forth by Senators Brown, Thune, Durbin and Dick Lugar. Hopefully, we’re going to move that policy forward because that makes the most sense to us,” he said.

Listen to or download an interview with Garry Niemeyer here: Garry Niemeyer Interview

Audio, Commodity Classic, corn, Ethanol, Ethanol News, National Ethanol Conference