Dallas-based White Energy Holding Company broke ground Tuesday on a new state-of-the-art ethanol facility in Hereford, Texas. According to a Business Newswire release, the $117 million project is expected to be operational by the fourth quarter of 2007 and will have a nameplate production capacity of 100 million gallons per year (MGPY), placing White Energy among the top ten ethanol producers nationwide and the first operator in Texas. The company currently operates a 45 MGPY nameplate ethanol plant in Russell, Kansas that was recently acquired from U.S. Energy Partners, LLC.
The E-Squadron
Ethanol-fueled airplanes are on the program for an air show at the Sioux Falls Regional Airport this weekend.
The Vanguard Squadron of Sioux Falls is a four-plane formation group that flies in air shows across the country. I had a chance to meet the entire squadron last week in Sioux Falls at the Broin Companies for media training. Here is a short interview I did with one of the pilots, Steve Thompson, who talks about why they have been using 100 percent ethanol in their planes since 1993. 
Thompson Interview (1 min MP3)
The Vanguard Squadron, which is sponsored by the Broin Companies, will also be appearing at the 2006 EAA AirVenture next week in Oshkosh, WI.
Michigan Ethanol Promo
Congressman Dave Camp (R-MI) hosted a promotion of E-85-fueled passenger cars and trucks Monday at the Dixie Motor Speedway. According to a story in the Saginaw News, representatives from DaimlerChrysler, Ford Motor Co. and General Motors Corp. attended to demonstrate their new flex-fuel vehicles, while the Michigan Corn Growers Association and Michigan Farm Bureau also participated to share perspectives on the future of ethanol and its impact on Michigan families, farmers and workers.
Cool Blue Fire
The logo is very cool and the company is “established to deploy the commercially ready, patented, and proven Arkenol Technology Process for the profitable conversion of cellulosic (“Green Waste”) waste materials to ethanol,” according to the Blue Fire website. The Irvine, CA-based corporation announced its management team this week, “led by Arnold R. Klann the founder of Arkenol and its cellulose conversion technology that has now been licensed on an exclusive and perpetual basis to BlueFire,” according to a MarketWire release.
Lots of interesting stuff on the website about this technology, as well as tribute to a Higher Power, for the inspiration and passion of the company’s founders. Amen. That’s pretty cool.
Pacific NW Ethanol Plans
The first Pacific Northwest ethanol plant is scheduled to break ground July 20 in Oregon. Cascade Grain is being constructed by JH Kelly Ethanol of Longview, Washington. According to JH Kelly, the plant will be the largest on the West Coast and one of the 10 largest in the United States. Cascade Grain has been working for more than six years on the 113 million gallon per year plant project which is expected to be complete in 2008. More on the story from the Longview (WA) Daily News.
Fill Up, Feel Good on the Highway
The latest “Fill Up, Feel Good” podcast from the Ethanol Promotion and Information Council is about ethanol hitting the highway.
Ethanol was the official fuel sponsor of the Interstate Highway System 50th Anniversary convoy across America last month and this report features some of the comments that were made about ethanol during the event.
The “Fill up, Feel Good” podcast is available to download by subscription (see our sidebar link) or you can listen to it by clicking here. (4:50 MP3 File)
The Fill Up, Feel Good theme music is “Tribute to Joe Satriani” by Alan Renkl, thanks to the Podsafe Music Network.
ACE Plays Pair of Governors
Kansas and Missouri may be rivals when it comes to college football and basketball, but they are on the same team when it comes to ethanol. That’s why governors of both states will share the stage at the American Coalition for Ethanol (ACE) 19th annual ACE Ethanol Conference & Trade Show August 8-10 in Kansas City, Missouri at the Crown Center. Missouri Governor Matt Blunt and Kansas Governor Kathleen Sebelius will both address the conference on August 9.
Missouri will also be represented at the conference by Senator Jim Talent who will receive ACE’s Legislative Leadership Award for helping champion the 7.5 billion gallon Renewable Fuels Standard in Congress.
More information on the conference is available on-line.
Farm Bureau Calls for More Tanks
The American Farm Bureau Federation is asking Congress to provide incentives for gas station owners to install storage tanks so that alternative fuels will be more available to the public. House and Senate bills H.R. 5346 and S. 2614 would provide those incentives for not only ethanol and biodiesel, but also compressed natural gas or hydrogen.
According to a release, AFBF President Bob Stallman sent a letter to members of Congress last week urging them to pass the bills, saying “The result of this legislation would be increased consumer access to alternative fuels and more use of such fuels as E-85 and biodiesel, which are renewable fuels produced from the crops grown by America’s farmers.”
Ethanol Prices
One question everyone always wants to know is how much does ethanol cost? While some people in the industry can provide lengthy explanations about spot market prices and long term contracts and so forth, the short answer is – it varies from day to day and location to location. Unlike the oil industry, which is largely controlled by OPEC, there is not a cut and dried daily price for ethanol.
That being said, it is interesting to take a look at where prices might be in down the road – which is what the futures market is for. When the Agriculture Department released its report last week on the cost of making ethanol from sugar, USDA chief economist Keith Collins covered that issue as it related to the economic feasibility of sugar-based fuel.
Collins pointed out that in May of 2006, “ethanol sold at a 94 cent premium to gasoline” averaging $3.00 a gallon. “That is an aberration, that is a wide spread and it reflects this transition we’ve been going through as we shift from MTBE as an oxygenate to ethanol, and ethanol has been selling at a premium.”
However, Collins says the futures market believes both ethanol and gas prices will go down within the next six months. “If you go out to January 2007 delivery, gasoline falls to $1.94 (on NYMEX) and ethanol (on CBOT) falls to $2.50, the spread between the two is only 56 cents.” (Collins was quoting futures prices the week ending July 7)
Some media reports have taken that to mean that the ethanol gold rush will come to an end in six months and investors will begin selling out. What it really means is that ethanol prices will come back to more normal levels as production begins to catch up with demand. And, of course, the futures prices do not reflect the energy tax credits and incentives for ethanol at federal and some state levels.
Incidentally, the full USDA report on Ethanol Production from Sugar is now available in PDF form on the USDA website.
East Coast Ethanol
Ethanol might soon become more available on the east coast. Agri-Ethanol Products of Raleigh, NC has announced that it now has financing to build as many as 20 renewable energy facilities from the Gulf states to New York. AEP is already building the first 100 million gallon ethanol plant located on the East Coast near Aurora, NC. According to a news release, at least two new North Carolina ethanol projects, in addition to the Aurora site, are anticipated as a part of the 20 potential facilities. Each of these facilities will produce 108 million gallons per year of undenatured, fuel grade ethanol; 380,000 tons of high protein DDGS and 320,000 tons of CO2, that will be purified and marketed into the food and beverage industries.