Research Looks Into Gas Prices

Joanna Schroeder February 26, 2016

Your eyes do not deceive. I paid $1.40 per gallon for ethanol-blended fuel on Thursday, February 18, 2106 in Fairfield Glade, TN. Photo credit: Joanna Schroeder

As I pulled into a gas station in Fairfield Glade, Tennessee last week I couldn’t believe the price per gallon of fuel with ethanol. After nearly $5.00 per gallon of gas a few years ago in states such as California, I never thought I’d see prices drop below $2.00. But they have and continue to stay. While this is great news for drivers, Big Oil is not too happy about the billions of dollars they are losing with cheap oil. Crude Oil prices have fallen 23 percent in 2016, and 70 percent in the last 20 months – prices the world hasn’t seen in more than a decade.

According to AAA, the national average for gas this week is $1.70 per gallon – 55 cents less than this time last year. Interestingly, anti-biofuel advocates are using cheap oil as a call to end the Renewable Fuel Standard (#RFS) and stop blending corn-based ethanol into our nation’s fuel supply.

Professor Bruce Babcock of Iowa State University says oil companies are making “thoroughly outrageous claims” about what it would cost them, and you, to keep up with the plan to reduce greenhouse emissions. In his paper “Compliance Path and Impact of Ethanol Mandates on Retail Fuel Market in the Short Run,” co-authored by Sébastien Pouliot of Iowa State, Babcock found the impact on consumer prices is “close to zero.” This paper was recently selected to be published in the American Journal of Agricultural Economics.

“One of the reasons for writing this paper was to debunk the myths for justifications of getting rid of the RFS,” Babcock said. “This takes one of the justifications away.”

biofuels, Ethanol, Research, RFS

API Continues to Lambaste #RFS

Joanna Schroeder February 26, 2016

The American Petroleum Institute (API) continues to lambaste the Renewable Fuel Standard (#RFS) as the energy policy draws criticism from all sides. Cited as the most effective energy policy ever enacted in the U.S. by supporters, API remains steadfast in its efforts to get the legislation repealed.

Gas station in Fairfield Glade, TN promoting ethanol-free fuel. Photo credit: Joanna Schroeder

Shortly before a Senate committee oversight hearing on Wednesday, API’s Downstream Group Director Frank Macchiarola said during a press call, “Ahead of the hearing, we are reminding policy makers and the public that the oil and natural gas industry is stepping up our call for Congress to protect consumers from this harmful mandate. We continue to seek the repeal of or significant reforms to the RFS. Since the inception of the ethanol mandate a decade ago, the U.S. has undergone an energy transformation from a nation of energy dependence and scarcity to one of energy security and abundance. It is well past time to reform outdated energy policies to reflect the energy realities of today and tomorrow.”

Macchiarola added that API is hopeful support in Congress for repealing or modifying the RFS is growing. (Although if the current presidential race is any indication, this is in fact not true.)

Growth Energy responded to the remarks stating once again that the oil industry is spouting its “same old, disproven talking points about ethanol and the RFS”. The organization points to the fact that ethanol is the most tested fuel in American history; it’s a less expensive choice for consumers at the pump; and that NASCAR drivers have raced more than eight million miles on ethanol.

“Though this kind of rhetoric should be shocking, it no longer is,” said Tom Buis, co-chair of Growth Energy. “The oil industry has made a habit of repeatedly trotting out bogus studies for the single purpose of blocking competition and consumer choice to protect their profits. The fact is that rigorous testing and unbiased studies from the government and other industries have repeatedly demonstrated that ethanol and other biofuels are a less expensive, cleaner and better performing alternative to oil.”Read More

biofuels, Ethanol, Growth Energy, politics, RFS

UNCTAD Report: Advanced Biofuels Here Now

Joanna Schroeder February 25, 2016

Second generation biofuels made from non-food biomass are here right now according to a new report from UNCTAD. “Second-Generation Biofuel Markets: State of Play, Trade and Developing Country Perspectives,” finds these biofuels are a commercial reality in the context of advanced technologies, economic pressures and a political will to act on climate change. The report focuses on the role advanced biofuels can play in meeting global climate and energy goals and how to make the technology available in developing countries.

With a specific focus on cellulosic ethanol, the report provides a wide-ranging review of the second-generation biofuels sector, maps selected cellulosic ethanol projects, and details recent policy developments from around the world. A key factor in decreasing costs for the industry has been process improvements that have allowed the market to expand, the report finds.

The United States has the largest installed capacity for cellulosic ethanol production and the greatest number of working second-generation biofuel facilities, the report found, followed respectively by the People’s Republic of China, Canada, the European Union (EU) and Brazil. As of 2015, there were no cellulosic ethanol projects on the African continent and in Latin America (excluding Brazil); however, progress has been made in bagasse-fired electricity co-generation and biomass cook stoves in these regions.

The report finds two main strategies have given traction to the growth of advanced biofuels. The first is a market-segmentation strategy in conventional/advanced cellulosic biofuels used in the U.S., and more recently in the EU with the adoption of limits for conventional biofuels, resulting in premium pricing. The second is the availability of national development bank loans that have reduced risk and promoted growth in the industry, especially in China and Brazil. Low interest rates and a venture-capital culture have also played a role in advancing the position of second-generation biofuels.

The report concludes with five suggestions for the responsible development of the second-generation global biofuels industry and is an update from a similar UNCTAD report published in 2014.

advanced biofuels, Cellulosic, Ethanol, Research

New BioJet Program Collaboration in Mexico

Joanna Schroeder February 25, 2016

The Mexico’s Sector Fund for Energy Sustainability (SENER-CONACYT) is supporting a new biojet collaboration with Boeing, Aeromexico and Mexico’s Airports and Auxiliary Services (ASA). The goal of the program is to advance research and development of sustainable aviation biofuel in Mexico. The Mexican government and participating institutions will fund the effort for four years, aiming to develop a self-sustaining business model. Research will be conducted on biomass sourcing, fuel production, sustainability and lifecycle assessment, and aviation biofuel market development.

The project will be coordinated through the Mexican Bioenergy Innovation Center and will support Mexico’s aviation sector as well as help meet the country’s environmental and economic goals. Executives at Boeing, Aeromexico, ASA and the Potosinian Institute of Scientific and Technological Research (IPICYT) formalized the initiative at a ceremony in Mexico City. In total, there are 17 organizations throughout the world participating in the program.

“To support customers and the aviation industry’s long-term growth, Boeing is proud to partner with Aeromexico and many key stakeholders to move Mexico’s sustainable aviation biofuel industry forward,” said Marc Allen, president, Boeing International. “Sustainable jet fuel will play a critical role in reducing aviation’s carbon emissions and will bring a new and innovative industry to Mexico.”

Aviation biofuel feedstocks will be sourced from Mexico and are expected to include jatropha, salt-tolerant Salicornia and sewage sludge. The initiative’s projects are expected to meet sustainability criteria established by the Roundtable on Sustainable Biomaterials.

“The success of these efforts would not be possible without the team work of Airports and Auxiliary Services (ASA) and our strategic partner Boeing,” said Sergio Allard, Chief of People & Industries Affairs Officer, Aeromexico. In Aeromexico, we recognize that conducting a sustainable operation is an everyday commitment. We are ready to assume the challenge and break the myth that you cannot be socially and environmentally responsible and competitive at the same time.”

aviation biofuels, biojet fuel

Senate Holds #RFS Oversight Hearing

Joanna Schroeder February 25, 2016

The U.S. Senate Committee on Environment and Public Works held an oversight hearing on the Renewable Fuel Standard (#RFS). The legislation has been under fire for several years and there are currently several lawsuits surrounding the program: the biofuels industry is suing because the required volumes (RVOs) for 2014, 2015 and 2016 are below what the legislation requires, and Big Oil is suing to reduce RVOs claiming there is not enough advanced gallons in the marketplace. In response to the hearing several ethanol associations stressed the importance of the benefits of the RFS to America.

“While we appreciate that the Administration improved the final Renewable Fuel Standard blending targets for 2016 compared to the purposed rule, regrettably, the methodology used to waive volumes for 2016 protects the old way of doing business by obstructing consumer access to cleaner fuels, stifling competition in the marketplace, and undermining innovation,” said Brian Jennings, the Executive Vice President of the American Coalition for Ethanol (ACE). “ACE members have made significant biofuel production advancements because of the RFS and we know that further innovation is within reach if federal policy continues to reward a competitive marketplace. ACE is strongly committed to ensuring consumers have access to high octane, low carbon, affordable blends of ethanol and we will explore all options at our disposal to achieve that goal with this Administration and the next.”

Tom Buis, co-chair of Growth Energy stated, “Homegrown ethanol and the RFS are major wins for the American people. Biofuels, such as ethanol, are a 21st century fuel for 21st century vehicles. It is our only alternative to oil, and the RFS is the most effective policy in reducing cancer-causing chemicals and the toxic emissions that come from oil’s monopoly on our motor fuel supply. The RFS supports consumer choice, creates hundreds of thousands of jobs across America, strengthens our energy security and slashes climate change causing emissions.

“Policies like the RFS improve America’s climate, national security, rural economy and consumer choice. Repealing or changing the RFS would turn back the clock and undermine the progress we’ve made toward increasing America’s energy independence and cleaning our air and environment.”

ACE, biofuels, Ethanol, Growth Energy, RFS

Cellulosic Ethanol Prices Hinges on Feedstocks

Joanna Schroeder February 25, 2016

A new study from Lux Research finds innovation is still needed to make advanced biofuels competitive. The report cites six cellulosic ethanol facilities online and finds Raizen has the lowest projected minimum ethanol selling price of $2.17 per gallon. Abengoa’s $500 million Hugoton plant has the highest price of $4.55 with feedstock cost as the most critical variable. (It should be noted the study was conducted before the Hugoton plant was taken offline due to Abengoa’s financial troubles.)

“Improving feedstock aggregation and lowering feedstock cost is critical in cellulosic ethanol achieving cost parity, as feedstock cost can impact total cost by 40%,” said Yuan-Sheng Yu, Lux Research Analyst and lead author of the report titled, “Uncovering the Cost of Cellulosic Ethanol Production.”

Lux Research built a comprehensive cost model based on six cellulosic feedstocks and three pre-treatment technologies. Among their findings:

Feedstock cost is a key differentiator. Two companies with the lowest projected minimum ethanol selling price – GranBio and Raizen – both utilize the cheapest cellulosic feedstocks. Sugarcane straw and sugarcane bagasse cost $40 and $38 per dry metric ton (MT), respectively, compared with corn stover ($90) used by Abengoa and POET-DSM and wheat straw ($75) used by Beta Renewables.
Bigger is far from better. Abengoa’s Hugoton facility cost $500 million but despite getting economic credits for a 21 MW on-site generation unit, it is projected to have the highest projected selling price for ethanol of $4.55 per gallon.
DuPont creates new economics. Even without electricity credits, DuPont has a projected selling price of $3.31 per gallon, similar to Beta Renewables and POET-DSM, at its 30 MGY plant. It uses improved feedstock aggregation processes, reducing corn stover from $90 per dry MT to $52 per day MT.

Yuan-Sheng Yu added, “Improvements in pre-treatment yield, enzyme performance and price, and fermentation efficiency potentially reduce costs by up to 16%.”

advanced biofuels, Cellulosic, Ethanol, Research

Do Farm Show Impact Farmers’ Buying Decisions?

Jamie Johansen February 24, 2016

Our latest ZimmPoll asked the question, “What is your favorite social media outlet for agriculture?”

It’s a tie! The two oldest forms of social media, Facebook and Twitter, rose to the top. When it comes to social media marketing in the agricultural field they ring tried and true. I still encourage people to step out of their comfort zones and see what other platforms have to offer. It is 2016 and social media is here to stay. Embrace it!

Here are the poll results:

Facebook – 44%
Twitter – 44%
Instagram – 5%
YouTube – 4%
Pinterest – 3%

Our new ZimmPoll is now live and asks the question, How important are farm shows to farmers’ buying decisions?

Thousands of farmers and ranchers take in farm shows nationwide. Agribusinesses invest big marketing dollars to share their latest news and info to attendees. We are on the road year-round covering these shows and want to know if they impact buying decisions?

ZimmPoll

Panelists Discuss E15 Revolution, Global Markets

Joanna Schroeder February 24, 2016

Panelists discussed the “E15 Revolution” during the Growth Energy Leadership Conference held in Orlando this week. The retailer discussion focused on their efforts to help grow the consumer availability of E15 across the country.

Panelists included Jim Pirolli, VP Fuels for Kum-N-Go; Mike Lorenz, Executive VP of Petroleum Supply; and Todd Garner, CEO of Protec Fuels.

When discussing the changing marketplace, Lorenz commented that initial sales have exceeded expectations, even before kicking off a marketing campaign around E15. “The consumers are finding it on their own, and sales are increasing.” Pirolli seconded this statement by adding, “When it comes to consumer choice, they’re going to go with a higher performance, better value product.”

To learn more about how retailers are marketing E15, listen to Chuck Zimmerman’s interview with Protec’s Todd Garner, who he saw on a similar panel at the National Ethanol Conference the week before: Interview with Todd Garner, Protec

Another interesting panel discussion took place around “Ethanol on the World Stage”. The discussion focused on the important role that ethanol plays in the global marketplace and the need to take advantage of every opportunity to expand ethanol utilization worldwide. Panelists discussed the importance of trade missions to identify new markets and expand existing opportunities. Also discussed were increased opportunities to export dried distillers grains (DDGs).

The panel was moderated by Ray Defenbaugh, CEO & Chairman of Big River Resources, LLC. Panelists included Paul Trupo, Director of the USDA FAS Global Policy Analysis Division; Joel Williams, Manager of Ethanol Trading at ADM; Mark Marquis, CEO of Marquis Energy, LLC; Amit Sachdev, South Asia Representative (India Bangladesh and Sri Lanka) at the U.S. Grains Council; and Junyang Jiang, Deputy Director of the U.S. Grains Council China World Office.

During the discussion, Ray Defenbaugh stressed the importance of the partnership with the U.S Grains Council, as it is helping create new opportunities across the globe for exports. During the panel, it was announced by Mark Marquis, a board member of Growth Energy, that Growth Energy has set a goal to export at least 2 billion gallons of fuel ethanol by 2022, calling the program, “At Least 2 by 22.”

biofuels, Distillers Grains, E15, Ethanol, Exports, Growth Energy

Goat’s Guts Lead to Better Biofuels

Joanna Schroeder February 24, 2016

New research finds that some day your gas tanks could be filled up by horses, sheep and goat’s guts. Researchers looked at how the anaerobic gut fungi, as compared to engineered fungi, were able to convert plant material into sugars that could be converted into advanced biofuels and other biobased materials.

Fungi found in the guts of goats, horses and sheep help them digest stubborn plant material. A team of researchers report in the journal Science that these fungi could potentially lead to cheaper biofuel and bio-based products. Professor of chemical engineering at the University of California, Santa Barbara Michelle O’Malley, was the lead author of the paper. She explained, “Nature has engineered these fungi to have what seems to be the world’s largest repertoire of enzymes that break down biomass.”

Fungi found in the guts of goats, horses and sheep help them digest stubborn plant material. A team of researchers report in the journal Science that these fungi could potentially lead to cheaper biofuel and bio-based products. Image courtesy of Daniele Faieta/Flickr

These enzymes — tools made of protein — work together to break down stubborn plant material. The researchers found that the fungi adapt their enzymes to wood, grass, agricultural waste, or whatever they were fed. The findings suggest that gut fungi could be modified so the produce better enzymes that will outperform even the best ones on the market today. With a more effective way to break down biomass, it should led to the development of less expensive biofuels and bioproducts.

O’Malley and her colleagues knew the fungi’s hyphae excrete proteins, or enzymes, break down plant material. The researchers understood that like tools in a toolbox, the more diverse the enzymes, the better the fungi can take apart plants and turn them into food. So the goal was to help develop this fungi toolbox for the bioindustry to use to better break down biomass.

“Despite their fascinating biology, anaerobic gut fungi can be difficult to isolate and study,” said Scott Baker, EMSL’s science theme lead for Biosystem Dynamics and Design, one of the agencies that collaboratively participated in the research. “By utilizing the cutting-edge scientific capabilities at EMSL and JGI, O’Malley showed how the huge catalog of anaerobic gut fungi enzymes could advance biofuel production.”

advanced biofuels, biochemicals, biomass, biomaterials, enzymes, Research

$3.50 May Be New ‘Corn Norm’

Lizzy Schultz February 24, 2016

The impact of corn prices varies between producers in different divisions of agriculture, with some producers benefiting from higher prices, and some benefiting from lower prices. Many factors seem to demonstrate that the new long-term “normal” for corn prices may be $3.50 per bushel, and Cody Heller, CEO of Central Wisconsin Ag Services (CWAS), has offered his insight into the cause of the record prices seen in 2012 and why it will be difficult for the markets to sustain prices that high over the next five to ten years.

It was increased demand for corn both for ethanol and exports, combined with a severe drought, that drove prices up in 2012. According to Heller’s report, past high prices and several good yields have led to global stocks of corn, soybeans, and wheat reaching record highs. The changing market for ethanol, however, may seriously impact the resulting demand for those record high supplies. According to USDA, we will not see an increased demand for US corn for ethanol higher than 0-1% from 2016 to 2025. On the global side, China is in a well-documented recession, and the country is forecast to import its lowest level of corn since 2009.

Heller says in order for corn prices to move higher, something would have to happen on the supply side. “This will come from a drought, governmental controls, or a stark increase in global growth and demand to reset global supply,” he says. “The catch-22 here is due to better genetics and better technology, corn yields (with the exception of 2012) have been growing at a pace of about 2-3 bu. per acre annually.”

Read the full report.

Ag group, biofuels, corn, Ethanol, International, RFS

Page 419 of 1,941
←
1
...
418
419
420
...
1941
→