RFS2 Start Impetus Behind MO Biodiesel Plant Start

John Davis

Today’s implementation of the new Renewable Fuels Standard (RFS2) was the impetus behind getting one Midwest biodiesel open by July 1st.

RenewableEnergyWorld.com reports the new owners of ME Bio Energy of Lilbourne, Missouri wanted to have the doors open of their 5 million-gallon-a-year refinery for today’s historic date:

General Manager, Jerry McDowell, said the group has “been working night and day” to get ready for the July 1st implementation of RFS2. “We have a fully staffed crew trained and ready to meet the Bio Diesel Production needs”, said McDowell. “Over the past sixty days we have worked diligently with Lee Enterprises of North Little Rock, the consulting group that helped us buy the plant” McDowell said, “and we brought back the plant’s original design and fabrication group, AP Innovations of Stuttgart, Arkansas. The combination of a dedicated staff, in conjunction with both Lee Enterprises and AP Innovations assisting us, has positioned ME Bio Energy to be ready to meet the demands of RFS2 earlier than we had hoped”. McDowell noted that the plant had obtained all its federal and state certifications, successfully run all its test samples, and was now ready to take orders. “I am certain that the refiners and producers, and other parties are beginning to fully understand the impact and obligations they now have under the Energy Independence and Security Act (EISA) of 2007 provisions that became effective July 1, 2010.” said McDowell.

Wayne Lee, owner of biodiesel consulting firm, Lee Enterprises, agrees. “When everyone realizes that 1.1 billion gallons of biodiesel or equivalent RINs must be purchased in 2010, and that the majority of biodiesel producers are currently not producing, I think there is going to be a ‘mad rush’ to find biodiesel” said Lee. “After all, 2010 is already half over and the companies that do not comply with their obligation can face daily fines of $37,000 per violation”, he said.

ME Bio Energy officials wanted to have the refinery ready to go as soon after purchase as possible.

Biodiesel

Biodiesel RIN Prices Spike as RFS2 Starts

John Davis

The price producers or importers of renewable fuel are having to pay for biodiesel RINs … Renewable Identification Numbers … have been going up as we approached today’s kickoff of the new Renewable Fuels Standard … better known as RFS2.

The 38-numeral identifiers are the basic currency for the RFS program for credits, trading, and use by obligated parties and renewable fuel exporters to demonstrate compliance, as well as track the volumes of renewable fuels, and Biodiesel Magazine says producers were taking heart at the news that bids were jumping up to 50 cents for biodiesel RINs,

Wayne Presby, a managing partner with White Mountain Biodiesel LLC in Haverhill, N.H., said the high biodiesel RIN credit prices were reassuring for him in these times without the $1 per gallon federal tax credit. White Mountain Biodiesel, a 5.5 MMgy biodiesel plant, has been under construction for approximately a year and a half, and Presby told Biodiesel Magazine on July 1 that construction is finally complete and the plant is undergoing commissioning along with IRS and U.S. EPA registrations. The plant’s fuel, which is made from waste greases, is meeting ASTM quality specifications.

Clean Fuels Clearinghouse and RINSTAR founder Clayton McMartin said with type B biodiesel RINs, it is economics 101 with price driving the supply and demand balance.“RFS2 has set the demand—the lack of the tax credit has reduced supply,” McMartin said. “The RIN credit price will continue to increase until the obligated parties have acquired sufficient RINs to meet this year’s mandate. Void of the tax credit, if the RIN price gets high enough then more production will come back online.”

McMartin went on to warn about volatility in the biodiesel market could cause violent swings in RIN prices.

Biodiesel, Government

Ethanol Groups Applaud Consumer Choice Bills

Cindy Zimmerman

Increasing consumer fuel choice and solving the “chicken and the egg” challenge to energy independence are the goals of two bills introduced this week in the U.S. House of Representatives.

Herseth SandlinOn Wednesday, Rep. Stephanie Herseth Sandlin (D-SD) introduced the Consumer Vehicle Choice Act of 2010 (H.R. 5633) and the Consumer Fuels Choice Act of 2010 (H.R.5632). The first would mandate that auto manufacturers provide consumers with greater choice of flex fueled vehicles (FFVs). Under this legislation, 50 percent of cars and light duty trucks in model years 2011 and 2012 must be FFVs, and that percentage rises to 90 percent in model year 2013 and years after. The second bill would promote ethanol use through grants for the installation of blender pumps. The bills are co-sponsored by Rep. Adrian Smith (R-NE).

“Americans need more choices at the pump, and those choices can begin with the cars and trucks they drive. By requiring that auto manufacturers produce vehicles that give Americans greater choice of fuels, we will help reduce costs for consumers and bring the nation closer to energy independence,” said Herseth Sandlin.

Ethanol groups applauded the introduced of the bills as the right formula for lessening our dependence on fossil fuels.

“To finally break the hold that petroleum has at the pump, we must start introducing flexibility into the nation’s fuel system,” said Brian Jennings, Executive Vice President of the American Coalition for Ethanol (ACE). “The smartest action we can take to move toward energy independence is to introduce flexibility into the fuel
system, and this can be done best through a combination of blender pumps and flexible fuel vehicles.”

“Expanding America’s use of ethanol requires pumps to dispense the fuel and vehicles to use it,” said Renewable Fuels Association (RFA) President and CEO Bob Dinneen. “Congresswoman Herseth Sandlin has introduced common sense legislation that addresses both needs. America’s ethanol producers can supply the fuel. What is needed is Congressional and Obama Administration support to bring it to consumers. This legislation goes a long way toward achieving that goal.”

Growth Energy CEO Tom Buis added, “Each additional Flex Fuel Vehicle model gives consumers the option of filling up with domestic, homegrown renewable fuel and enhances our national security, all while creating U.S. jobs that can’t be outsourced.”

ACE, Ethanol, Ethanol News, Government, Growth Energy, RFA

USDA Report Disputes Land Use Theory

Cindy Zimmerman

USDAUSDA’s new planted acreage report out Wednesday morning estimates corn acreage planted is two percent higher than last year, but that is down a point from the March report with more acres are going to soybeans. Corn planted area for all purposes in 2010 is estimated at 87.9 million acres, up 2 percent from last year. Acreage is up in Illinois, Kansas, Indiana, Missouri and Ohio; but down significantly in Iowa, Nebraska and South Dakota. Soybean planted area for 2010 is estimated at a record high 78.9 million acres, up 2 percent from last year.

Actually, the total amount of land dedicated to crops in the United States has dropped for the second straight year in 2010, according to the report, which shows total cropland has declined 6 million acres since 2008. The Renewable Fuels Association (RFA) notes that this is further evidence growth in ethanol production is not leading to cropland expansion.

Renewable Fuels Association Logo“The data clearly show that crop acres in the United States continue to trend downward,” said Bob Dinneen, RFA president and CEO. “That’s because new technology and dramatically increasing yields are allowing farmers to produce more crops on less land. Today’s report reinforces the fact that the nation’s farmers simply don’t need to expand cropland to meet global demands for food, feed, fiber, and biofuels.”

While corn acres are up compared to last year, that increase is more than offset by reductions in acreage for other coarse grains and wheat. USDA estimates total 2010 crop acres at 318.9 million, down from 319.3 million in 2009 and 325 million in 2008. For the sake of comparison, RFA noted that total planted acres averaged 327 million during the decade of the 1990s. A record corn crop of at least 13.3 billion bushels is expected in 2010, despite the fact that farmers planted nearly 6 million less acres of corn than in 2007 when the first 13 billion bushel crop was achieved.

RFA also noted that corn plantings were down from last year in many states with high levels of Conservation Reserve Program (CRP) acreage, which challenges the notion that grain ethanol expansion is leading to increased CRP conversion. For instance, corn acres dropped 4% in Texas, the leading CRP state in the nation. Corn acres also fell 7% in South Dakota, 4% in Nebraska, 3% in Iowa, and 1.3% in Minnesota.

Ethanol, Ethanol News, RFA, USDA

Air Force Testing Camelina Biofuel in Fighting Falcons

John Davis

From a guy who has had some great opportunities to be right on the flightline as Fighting Falcons roared to life, this picture doesn’t do justice to that rumble you feel deep down in your bones as you watch these magnificent machines take off to fight the war in the air, ready to blow things up and kill the bad guys (sorry, I get a little caught up in nostalgia this close to Independence Day). Now, these fine war birds will soon be dominating the skies on a blend of clean-burning biofuel.

This U.S. Air Force press release says an F-16 engine at the Arnold Engineering Development Center (AEDC) in Tennessee is testing a 50/50 blend of JP-8 conventional aviation fuel and a camelina-based biofuel:

“The testing recently initiated at AEDC will be the first dedicated, uninstalled engine tests conducted by the Air Force [on Hydro-processed Renewable Jet (HRJ) blended fuel],” said Jeff Braun, the Air Force’s Alternative Fuels Certification Office director. “These will also be the first engine tests conducted by the Air Force [on HRJ blended fuel] in a facility that can simulate altitude effects on the aircraft. The data produced will be very, very valuable in this program. In fact, we plan on using that data to justify and support upcoming flight tests of the F-22, the C-17 and then possibly even the F-15.”

This test supports the bio-fuels certification effort of this field engine, said 1st Lt. Antonio Brunson, 717th Test Squadron program manager for the first phase of the test.

Testing will simulate the overall engine conditions experienced in the full flight envelope and include ignition light-off, throttle transients, augmenter lights and sequencing along with screech and rumble monitoring.

Military aircraft engines operate with afterburners to enhance thrust, but these can create large unsteady pressure oscillations termed screech and rumble, which can damage the afterburner structure.

Officials see the green fuel as the future for the Air Force.

biofuels

USB: Unfair Argentinian Subsidies on Biodiesel Feed

John Davis

The American soybean industry is crying foul over Argentina’s practice of taxing its whole soybeans for export at a higher rate than it taxes its soybean meal, oil and biodiesel destined for foreign markets. And this article from Feedstuffs.com says the United Soybean Board (USB) believes that is costing the U.S. soybean industry up to $500 million each year:

The soybean checkoff-funded study found that the lower tax burden on Argentina’s soybean meal, oil and biodiesel creates a strong economic incentive for processing soybeans in Argentina. The country then exports these value-added products rather than whole soybeans. Argentina represents the third-largest soybean-producing country behind the United States and Brazil, but is now the biggest exporter of processed soybean products such as soybean meal, oil and biodiesel. Figures from the study show Argentina exports 99% of its soybean meal and 93% of its soybean oil in an average year.

LMC International, an independent economic and business consultancy serving agriculture, conducted the study for USB. It concluded that if the different tax schemes never existed, the United States would have invested more heavily in soybean crushing capacity with an eye on export markets, which would have boosted U.S. soybean prices.

Americans representing U.S. oilseeds interests point to Brazil’s elimination of its differential export taxes in the mid-1990s and the corresponding dramatic drop in that country’s share of value-added soybean meal and oil exports as proof of that the Argentinian lower tax burden is having an impact on world soybean oil markets.

Biodiesel, feedstocks, International, Soybeans

Land Rover to Introduce Biodiesel Concept Vehicle

John Davis

SUV maker Land Rover is set to formally introduce a vehicle that is purported to do pretty well on biodiesel.

This post on The Car Connection blog says the unveiling of the LRX Concept will take place tomorrow for the 40th anniversary of the Range Rover:

The LRX was previously expected to make its public debut at the Paris Motor Show this fall, and that’s still a likely candidate for its first show-circuit appearance. The concept version of the LRX is powered by a 2.0-liter diesel engine capable of sucking 60 mpg out of biodiesel. The biodiesel element may not make it to production, but we’d expect to see a highly-efficient diesel engine in the car from the start–for Europe at least. In the U.S., a small turbocharged gas burner is more likely. Stop-start tech and lightweight materials are also expected to play a key role in fuel savings with the new compact Range Rover.

You can watch the official unveiling at this website.

Biodiesel, Car Makers

Ceres Develops First Salt Tolerant Energy Crop

Joanna Schroeder

Now this is interesting. I was reading earlier this morning in Cadillac Desert about how agriculture in many areas is suffering from water issues that include too much salt. The salt damages the soil, kills the crops and ultimately the land is taken out of production. Today, there are over one billion acres of cropland that have been abandoned around the world and 15 million acres just in the U.S.

However, this may become an issue of the past. Today, Ceres, Inc., a company focusing on the development of energy crops, announced that it has developed a plant that could bring new life to millions of acres of abandoned or marginal cropland damaged by salts. According to the company, results in several of their crop tests, including switchgrass, have shown high levels of salt tolerance.

Ceres reported that its researchers tested the effects of very high salt concentrations and also seawater from the Pacific Ocean, which contains high concentrations of salts, on energy grass varieties such as sorghum, miscanthus and switchgrass, currently being grown in their greenhouses located in California. These sources of biomass are being considered to produce fuel and electricity.

“Today, we have energy crops thriving on seawater alone, said Richard Hamilton, Ceres President and CEO. “The goal of course, is not for growers to water their crops with seawater, but enable cropland abandoned because of salt or seawater effects to be put to productive uses.”

The next step in Ceres’ research is to evaluate energy crops with its proprietary salt-tolerant trait at field scale. Should the results be confirmed, the company says that biofuel and biopower producers will have more choice for locating new facilities, have more productive options for marginal land and ultimately, the ability to displace even greater amounts of fossil fuels.

Hamilton concluded, “In the end, this is not so much a salt trait, but a productivity trait and a land-use trait. I am convinced more than ever that techniques of modern plant science can continue to deliver innovations that increase yields and reduce the footprint of agriculture. Improved energy crops will enable the bioenergy industry to scale far beyond the limits of conventional wisdom.”

bioenergy, biofuels, biomass, Company Announcement, News

A Sweet Deal – Win a VIP Trip to Indy Grand Prix of Sonoma

Joanna Schroeder

The IndyCar Series is in full swing and only a week ago, the Team Ethanol IndyCar was back on track at the Iowa Indy Corn 250. But there is plenty more to look forward to this season. SweeterAlternative.com has announced a contest that will send one lucky winner and a guest to the Indy Grand Prix of Sonoma on August 20-22, 2010. For those of you not familiar with California, Sonoma is one of the country’s most famous places for wine.

The contest is supported by the Brazilian Sugarcane Industry Association (UNICA), and this year sugarcane ethanol fuels the majority of the IZOD IndyCar races in the U.S.

“The contest will raise awareness about the benefits of sugarcane ethanol, a clean renewable fuel that could help Americans save money at the pump and cut dependence on Middle East oil,” said Joel Velasco, Chief Representative of UNICA. “Unfortunately, the fuel is practically unavailable in the U.S. due to a 54-cent per gallon tariff which is set to expire at the end of this year. We hope this sweet deal will broaden awareness about the benefits of sugarcane ethanol and motivate Americans to demand greater choice at the pump,” he added.

The winner will receive roundtrip airfare, hotel for three nights, and VIP seating at the race as well as a embark on a five-hour guided tour through the area’s scenic regions, engaging in some wine tasting along the way. For a chance to win, go to www.SweeterAlternative.com/Sonoma. You must be a legal resident of the U.S. and 21 years of age to enter.

Ethanol, Indy Racing, News

25x’25 Shows Progress Toward Renewable Energy Goal

Cindy Zimmerman

25x'25The nation is moving slowly but surely toward greater energy independence, according to a new progress report from 25x’25.

Renewable energy produced in the United States between 2004 and 2009 grew by about 23 percent, according to the report, Meeting the 25x’25 Goal: A Progress Report. The 32-page analysis details advances made by the renewable energy sector since the Alliance was formed in 2004 toward meeting 25 percent of the nation’s energy needs with renewable resources from the land by 2025.

Among the report’s findings:

– U.S. renewable energy consumption at the end of 2009 was 8.3 percent of total energy consumption, up from less than 6 percent in 2004

– Ethanol production tripled in the last 5 years with 10.8 billion gallons produced in 2009, while biodiesel production climbed in 2008 to almost 700 million gallons

– The electricity generating capacity from wind facilities has grown an astonishing 429 percent since 2004, with total generating capacity now over 35,000 megawatts

– Solar production capacity for both thermal and electricity generation has grown 41 percent since 2004. Some 40 megawatts of solar energy were installed off the grid in 2009

The report emphasizes that while much has been accomplished, the need to make the transition to a new energy future is even more vital now than it was when the vision was adopted in 2004. “We will continue to forge a path to a cleaner, more secure and economically viable new energy future – one defined by ever-increasing amounts of domestically produced, renewable forms of energy,” said Read Smith, co-chairman of the National 25x’25 Steering Committee, in a press conference this morning.

Read the report here.

Energy, Ethanol, Ethanol News, Solar, Wind