Biobased Industry Positioned to Explode

Joanna Schroeder October 5, 2016

According to a new report released by the U.S. Department of Agriculture (USDA), the biobased products industry contributed $393 billion and 4.2 million jobs in 2014, an increase of 220,000 jobs and $24 billion over 2013. “An Impact Analysis of the U.S. Biobased Products Industry,” commissioned by USDA’s Biopreferred Program, is a follow-up to the 2015 report and sought to examine and quantify the effect of the U.S. Biobased products industry on each U.S. state.

The new study found that the biobased industry directly supported 1.53 million jobs in 2014. For every 1,000 direct jobs in the biobased industry, 1,760 indirect jobs were supported. In other words, the 1.5 million jobs directly supported by the biobased industry supported 2.7 million indirect and induced jobs. In addition, the $127 billion in value added from sales by the biobased products industry generated another $266 billion in indirect and induced sales.

“When USDA released the first-ever Economic Impact Analysis of the U.S. Biobased Products Industry last year, we were thrilled to see what a positive impact this sector was having on our economy, and this updated analysis shows that the sector is not just holding strong, but growing,” said USDA Ag Secretary Tom Vilsack. “America has an appetite for everyday products-including plastic bottles, textiles, cleanings supplies and more-made from renewable sources, and that demand is fueling millions of jobs, bringing manufacturing back to our rural communities, and reducing our nation’s carbon footprint. As this sector is strengthening,” continued Vilsack, “so is the economy in rural America, where this year the unemployment rate dropped below six percent for the first time since 2007. USDA is proud to see such strong returns on our investment into the biobased products industry.”

States leading the way in the biobased industry include California (145,080), North Carolina (90,040), Texas (88,680), Georgia (80,520) and Pennsylvania (71,360). It should be noted that the biobased industry, as defined by USDA, includes agriculture and forestry, biorefining, biobased chemicals, enzymes, bioplastic bottles and packaging, forest products and textiles. The definition does not include energy.

The report concludes that despite the current low price of oil, it is projected that the U.S. biobased products industry will exhibit steady growth over the next five years. However, several challenges will need to be overcome including, but not limited to:

Production tax credits (PTCs) must be extended beyond biofuels to include biobased products;
Further legislation is required to support the biobased products industry;
Financial incentives are needed to promote the construction and operation of more U.S.- based facilities; and
States need to provide resources to support the growth of the biobased products industry, which is very important because currently there are insufficient pilot plants to foster innovation.

Click here to read the full report.

biochemicals, biomaterials, bioplastics, bioproducts, USDA

Spurlock Takes NCGA Helm Focused on #Ethanol Trade

Joanna Schroeder October 4, 2016

Wesley Spurlock, a grower from Spurlock of Stratford, Texas, officially took the helm as the President of the Board for the National Corn Growers Association (NCGA) Saturday and he has his eye on trade as a major focus of the 2017 fiscal year. Trade will play a starring role in finding homes for the increasing corn harvests and one growing area of trade: ethanol and dried distillers grains (DDGs).

“This year is much like the one we just finished,” said Spurlock. “We are looking at a massive corn crop. It is still being harvested but, even with some rain problems in the Midwest, the yields may be there. So, growing demand remains awfully important to finding a use for the crop that we have.”

Spurlock will utilize several teams focused on various elements of increasing demand including ethanol. “Our new action teams work well with our strategic plan,” said Spurlock. “We have three new teams focused on demand: the Ethanol Action Team; the Feed, Food and Industrial Action Team; and the Market Access Action Team. These groups on the demand side will all be working hard to find out where we are and where we need to be.”

He continued, “We have to work every side of this. We need trade. We need to work for the Trans Pacific Partnership. We need to work with our partners in the livestock industry. We need to work with the ethanol industry to keep that market open. And, we need to keep government regulations from becoming more cumbersome.”

Spurlock stresses that members will play an important role in achieving success. “We need the grassroots to go straight to their Representatives and Senators. They have to be active on the political side and the regulatory side. When we ask, it is because we do really need all of our members to come out and voice their opinions so that we can all keep the freedom to farm.”

biofuels, corn, Ethanol, Exports, NCGA

U.S. Propane Exports Growing

Joanna Schroeder October 4, 2016

A recent Today in Energy looks at the correlation between the growth of propane exports and growth in exports of petroleum products. According to U.S. Energy Information Administration data (EIA), during the first half of 2016, the U.S. exported 4.7 million barrels petroleum products per day. This is an increase of 500,000 b/d over the first half of 2015 and nearly 10 times the crude oil export volume. During the same time period, propane exports increased by more than 230,000 b/d while distillate (50,000 b/d) and gasoline (140,000 b/d) exports also increased. During the first six months of this year, propane has surpassed motor gasoline exports to become the second-largest petroleum product export.

However, while export volume increased, export destinations remained largely unchanged. Top countries included Mexico (775,000 b/d), Canada (579,000 b/d) and the Netherlands (271,000 b/d). EIA reports that the majority of petroleum exports stay in the Western Hemisphere with nearly 60 percent of total petroleum product exports in 2015 going to this region, down slightly from 65 percent in 2005.

U.S. propane exports increased from 562,000 b/d in the first half of 2015 to 793,000 b/d in the same period of 2016 with exports to Asia and Oceania accounting for 94 percent of growth. Japan imported the most U.S. propane at 159,000 b/d in the first half of 2016, an increase of 111,000 b/d from 48,000 b/d in the same period of 2015. Panama, historically a stable export market, decreased from 41,000 b/d in the first half of 2015 to 7,000 b/d in the first half of 2016.

Today in Energy reports that the large increases in propane exports to Japan and decreases in propane exports to Panama could be a result of reduced ship-to-ship transfer activity. However, the analysis found that some of the propane exports from the U.S. that undergo ship-to-ship transfers will cite the location of the transfer but not the final destination of the propane. This often results in larger-than-actual export numbers for the countries where the ship-to-ship transfers take place and in less-than-actual numbers for some final destinations.

Propane

Canada Adopts Carbon Pricing Strategy

Joanna Schroeder October 4, 2016

Canada has announced a carbon pricing strategy on emissions that takes effect in 2018 with a $10 per ton rate. The fees rise to $10 per ton per year until they are capped out at $50 per ton by 2022. As part of the legislation, provinces and territorial governments can select from two carbon pricing systems: carbon tax or cap and trade, and have the ability to use the carbon revenues as they choose. Advanced Biofuels Canada commended the policy but has cautioned that a well-designed national carbon price system will address economic distortions between provinces and territories and allow Canada to use border adjustments to maintain competitiveness with our international trading partners.

Thomson said there are cleaner transportation fuel option today including low carbon advanced biofuels as well as electric, hydrogen and renewable natural gas vehicles.

“The Trudeau government’s decision to place a uniform national price on carbon is an important step to reducing transportation sector emissions,” said Ian Thomson, President of Advanced Biofuels Canada. “An effective carbon price system must put a visible price on the lifecycle carbon emissions of all fuels to support the transition to cleaner transportation fuel choices. Nascent carbon pricing systems in BC (carbon tax) and Quebec (cap & trade) have room for improvement, and all Canadian markets should adopt a common approach to maintain level economic conditions.”

The organization is also calling on governments to adopt firm regulatory measures to assure that not only real carbon reductions are achieved, but to ensure these low-carbon fuels are available to consumers.

“Advanced Biofuels Canada has recommended that Canadian governments adopt a Clean Fuels Strategy to combine firm action on carbon pricing, flexible low carbon fuels regulation, and strategic cleantech investment to leverage Canada’s natural resources and demonstrate leadership on transport emissions.” Thomson concluded, “This approach will ensure that Canada benefits from the economic growth in the low carbon economy and meets its carbon reduction commitments.”

advanced biofuels, Carbon

BIO Releases RIN White Paper

Joanna Schroeder October 4, 2016

A new white paper finds evidence to challenge the assumption that the ethanol blend wall caused the 2013 spike in Renewable Identification Number (RIN) spot market prices. “The Myth of High RIN Prices as Proof of the Blend Wall,” was released by the Biotechnology Innovation Organization (BIO) and analyses EPA data on compliance of the Renewable Fuel Standard between 2010-2013. The blend wall is the point when ethanol blending in gasoline is greater than 10 percent.

“The success of the Renewable Fuel Standard has become distorted by the myth that U.S. refiners have encountered an unbreakable blend wall,” said Brent Erickson, executive vice president of BIO’s Industrial & Environmental Section. “Oil refiners, their champions in Congress, and even EPA have proposed changes to the RFS program based on this myth. Yet these changes to the RFS are aimed at solving a problem that never existed.”

Erickson continued, “Data recently made available by EPA demonstrates that obligated oil refiners and importers were able to meet RFS requirements through 2013 – even building excess RINs – despite having reached the blend wall as early as 2010 and definitely surpassing it by 2012. EPA’s delays in issuing 2014 and 2015 rules – which were in response to the assumed arrival of the blend wall – obscured this data until now. The delays in issuing rules and the proposed changes to the RFS have undercut investment in advanced biofuels and harmed developers of new technology. EPA should reconsider its proposed RFS rules for 2017 in light of the newly available data.”

The Myth of High RIN Prices as Proof of the Blend Wall finds:

Data recently released by EPA challenges conventional wisdom that the blend wall caused RIN prices to rise in 2013.
Refiners and importers blended ethanol into obligated gasoline volumes beyond the 10 percent limit as early as 2010.
Refiners’ and importers’ use of compliance flexibility reveals they did not experience RIN shortages at any point.
EPA’s rulemaking delays and unwarranted changes to the RFS based on blend wall assumptions harmed biofuel producers while providing obligated parties relief from a problem that didn’t exist.
EPA should reconsider its 2017 RFS proposed rule in light of this newly available data.

BIO, Ethanol, RFS, RINS

EPA Proposes #Biofuels Market Growth Rule

Cindy Zimmerman October 4, 2016

The Environmental Protection Agency on Monday released a proposed update to Renewable Fuels Standard (RFS) regulations “to better align our standards with the current state of the renewable fuels market and to promote the use of ethanol and non-ethanol biofuels.”

According to the agency, the proposed changes are the result of “recent developments in the marketplace resulting in increased production of cellulosic, advanced and other biofuels” and will help increase production and use of renewable fuels “by allowing the market to operate in the most efficient and economical way to introduce greater volumes of renewable fuels under the program.”

The proposed rule includes:

An updated regulatory structure that would allow biofuel producers to partially process renewable feedstocks at one facility and further process them into renewable fuels at another facility under existing pathways.

Updating fuel regulations to allow expanded availability of high ethanol fuel blends for use in flex fuel vehicles (FFVs).

New feedstock approvals for cellulosic biofuels produced from short rotation poplar and willow trees, cellulosic diesel produced from co-processing cellulosic feedstocks with petroleum, and renewable diesel and biodiesel produced from noncellulosic portions of separated food waste.

Ethanol producer groups are in the process of reviewing the proposal but Renewable Fuels Association (RFA) president and CEO Bob Dinneen says they have been working with the EPA for some time on these draft regulations. “Our goal is to ensure the final regulations do not unreasonably impair the ability of blenders and retailers to offer ethanol flex fuels like E85 to consumers,” said Dinneen. “Ethanol flex fuels are the lowest-cost, lowest-carbon, and highest octane liquid fuels on the market, and it is imperative that these EPA regulations help, not hinder, broader commercial introduction of these fuels.”

Growth Energy CEO Emily Skor expressed concerns about the impact of the proposal on E15 retailers. “If this proposed rule is finalized, this regulation would leave E15 as the only ethanol-blended fuel that does not have Reid Vapor Pressure (RVP) relief,” said Skor. “It is imperative that E15 be given the same volatility treatment as regular E10 gasoline.”

EPA is also seeking comment on a variety of other issues that impact renewable fuels, including Renewable Identification Number generation for renewable electricity used as transportation fuel and requirements for facilities that could use carbon capture and storage as a way to reduce carbon in the production of renewable fuels in the future. Once the proposal is published in the Federal Register, parties will have 60 days to comment.

advanced biofuels, biofuels, Cellulosic, EPA, Ethanol, Ethanol News, Growth Energy, RFA, RFS

BioEnergy Bytes

Joanna Schroeder October 3, 2016

Global Bioenergies and Clariant have announced the first isobutene production from a wheat straw hydrolysate, in the industrial pilot of Pomacle Bazancourt. This success is the result of a collaboration initiated more than 18 months ago, and has been made possible by combining Clariant’s proprietary process, allowing for the conversion of agricultural residues into sugar-rich hydrolysates, with Global Bioenergies’ proprietary process for the production of isobutene from various industrial-grade sugars.
Carnival Corporation & plc, the world’s largest leisure travel company, has signed a framework agreement with Shell Western LNG B.V. to be its supplier of marine liquefied natural gas (LNG) to power the world’s first fully LNG-powered cruise ships. Under this framework agreement, Shell will initially supply Carnival Corporation’s AIDA Cruises and Costa Cruises brands with fuel for two new LNG-powered ships expected to launch in 2019 with itineraries visiting popular northwest European and Mediterranean ports.
The global white biotechnology market is expected to reach USD $487.08 billion by 2024, according to a new report by Grand View Research. Rising awareness and emphasis for the adoption of greener and environment-friendly technologies in various end-use industries is expected to drive the market over the next eight years. Biofuels accounted for over 35% of the market in terms of revenue on account of rising government regulations to include the product in combination with conventional energy sources including diesel and gasoline. Rising biodiesel demand as a raw material for the manufacturing of resins, and polymers will fuel industry growth over the forecast period.

Bioenergy Bytes

Retailers “Pink Out” at the Pump

Joanna Schroeder October 3, 2016

During the month of October, Sheetz, Minnoco, Protec and Murphy USA are participating in the annual Pink Out program to raise funds and awareness for breast cancer. For each gallon of E15 sold, two cents will be donated to a breast cancer organization. This year Growth Energy is joining the retailers for their promotion.

“We are proud to work with such great partners to bring awareness to breast cancer research and support wonderful organizations working to eradicate this terrible disease,” said Emily Skor, CEO of Growth Energy. “Ethanol has replaced toxic, carcinogenic chemicals that were previously blended in gasoline, so ethanol has already helped in the fight against cancer in tangible ways. By partnering with leading retailers such as Sheetz, Minnoco, Protec and Murphy USA, this program ensures we continue to take up the fight on behalf of mothers, daughters and families everywhere.”

The Pink Out program will run through October at participating stations, with more than 720 dispensers included in the program in North Carolina, Minnesota, Iowa, Illinois, Arkansas and Florida. Drivers who want to participate in this program should look for the pink nozzle handles and signage, and can find their nearest E15 station at GetEthanol.com.

E15, Ethanol, Growth Energy

Minnesota #Biodiesel Mandate Stands Firm

Joanna Schroeder September 30, 2016

Minnesota has been and continues to be a leader in the support of biofuels and was the first state to pass a biodiesel mandate requiring B20 (20 percent biodiesel, 80 percent diesel), to be used in 2018. Last year a motley group of oil, gas, trucking, auto manufactures and dealers and trade groups, sued four key Minnesota state legislators directly tied to the biodiesel mandate. In the true fashion of supporting those who support you, several biodiesel associations (National Biodiesel Board, Minnesota Soybean Growers Association, Minnesota Biodiesel Council and Iowa Biodiesel Board) assisted the legislators in the lawsuit.

Lawsuit Background
The suit challenged the Minnesota Mandate on two grounds. First, they argue the mandate is preempted by the Renewable Fuel Standard (RFS) and that it was implemented in violation of the state’s Administrative Procedure Act (MAPA). The groups also called for an injunctive relief to the current use of B10 as part of the mandate and also for the future use of B20.

Biodiesel Mandate Background
The biodiesel mandate requires that 10 percent, or B10, be blended with #2 diesel from April to September 30 of each year and then lowers to B5 during the winter months. Due to lack of infrastructure in some areas of the state along with inadequate regulatory protocol, B10 was not implemented until July 1, 2014 when both challenges were deemed overcome. The mandate then requires the use of B20 between April-September beginning in 2018 and once again during cold months the blend level is reduced to B5. The only path to higher blends of biodiesel in winter months is if state officials determine several conditions are met, mainly that higher blends are suitable for year-round use in the state.

The Ruling
The case was heard in the United States District Court’s District of Minnesota and was ruled in favor of biodiesel. The judges upheld the biodiesel mandate in a ruling published on September 29, 2016. In regard to the RFS, the judges ruling stated that Minnesota’s mandate is not preempted by the RFS; rather it works in conjunction with the RFS.

Industry Response
In response to the ruling, the National Biodiesel Board released the following statement. “This is a significant victory that maintains the pathway to clean energy, renewable fuel and green jobs in Minnesota and across the country. The court’s ruling affirms biodiesel’s valuable role to help states move to renewable energy sources, promoting the rural economy and energy independence. We are pleased the District Court agreed with our position that America’s Advanced Biofuel is working both as a clear success story within the Renewable Fuel Standard and for states, which comes with it numerous benefits, including environmental.”

Theresia Gillie, Minnesota Soybean Growers Association president, said of the news, “We are very pleased to see the state and Minnesota Soybean’s motions were successful in dismissing the case against the state’s biodiesel mandate. Once again, Minnesota is at the forefront of energy independence and supporting renewable fuels. Nearly all engine manufacturers approve B20 for their engines and now Minnesotans are ready for the move to B20. We thank the State of Minnesota for their vehement defense of the biodiesel mandate.”

advanced biofuels, Biodiesel, Legislation, RFS

IA Retailers are “Pink at the Pump”

Joanna Schroeder September 30, 2016

Beginning October 1, 2016, nearly 30 fuel retailers in Iowa are kicking off the “Pink at the Pump” campaign to raise funds for breast cancer as well as raise awareness about E15. These retailers have committed to donating 3 cents of every gallon of E15 sold during the month of October to the National Breast Cancer Foundation (NBCF).

“October is ‘Breast Cancer Awareness Month,’ and it’s a perfect time for Iowa E15 retailers to join forces with the National Breast Cancer Foundation to raise awareness about breast cancer and cleaner-burning E15,” noted Iowa Renewable Fuels Association (IRFA) Managing Director Lucy Norton.

NBCF Senior Director of Development Danae Johnson said of the promotion, “Filling-up with E15 means you’re fueling your vehicle with a more environmentally-friendly fuel that contains less carcinogens than straight petroleum gasoline. Now, for the entire month of October, it also means you’re helping to combat breast cancer while seeing a lot of pink at participating Iowa E15 fueling locations. We appreciate the support of the Iowa Renewable Fuels Association and Iowa Corn this Breast Cancer Awareness Month.”

“Many people have started eating healthier, but they don’t ever think about what they’re being exposed to with daily activities, like fueling their cars,” said breast cancer survivor and Kansas fuel retailer Cheryl Werth Near, who was featured in the documentary ‘Pump.’ “I’m a breast cancer survivor with no previous family history of breast cancer. The truth is gasoline is full of toxic aromatics. Ethanol has no toxins or carcinogens, so the higher the ethanol blend, the less toxic aromatics you are being exposed to when fueling your car. This makes E15 not only a healthier choice, but the higher octane choice that reduces greenhouse gas emissions and saves you money at the pump.”

The Iowa Renewable Fuels Association and Iowa Corn Promotion Board have teamed up with the National Breast Cancer Foundation for the “Pink at the Pump” campaign to help combat breast cancer with cleaner-burning fuels, like E15. For the entire month of October, participating locations will feature pink nozzle guards for E15, pink promotional t-shirts for staff, and many other pink point of sale materials.

E15, Ethanol, Iowa RFA

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