Biodiesel Choice of Fleets Replacing Petroleum

John Davis

eiaThe latest data from the U.S. Energy Information Agency shows alternative fuel use is up. And when it comes to what the groups using fuel at the highest rates, the larger, medium duty vans, are picking to replace non-renewable oil, that choice is biodiesel.

Many fleets meet petroleum reduction requirements by using biodiesel rather than alternative fuels. Changes in biofuel subsidies, specifically replacement fuels like ethanol and biodiesel, affect consumption trends in the marketplace. With the reinstatement of the biodiesel tax credit and the requirements under the Renewable Fuel Standard, consumption of biodiesel grew almost 240% between 2010 and 2011.

The report goes on to say ethanol consumption during the same period remained flat, but the use of electricity in light-duty automobiles increased by 36 percent.

Biodiesel, Government

RFS Reform Bill Introduced

Joanna Schroeder

Rep Bob GoodlatteThis afternoon, Reps. Bob Goodlatte (R-VA), Jim Costa (D-CA), Steve Womack (R-AR), and Peter Welch (D-VT) released the RFS Reform Act in the U.S. House of Representatives. During a press conference to “unveil:” the bill Goodlatte said, “The RFS debate is no longer just a debate about fuel or food. It is also a debate about jobs, small business, and economic growth. The federal government’s creation of an artificial market for the ethanol industry has quite frankly triggered a domino effect that is hurting American consumers, energy producers, livestock producers, food manufacturers, and retailers. The broad coalition of organizations supporting this legislation echo the same sentiment: the RFS is not working.”

The representatives say that the RFS is causing food prices to go up, and has not provided relief for consumers at the pump.  In fact, they say, citing the RFS, the EPA is setting the target for refiners to blend cellulosic biofuels into gasoline higher than the amount of cellulosic biofuels that exists. When these non-existent fuels cannot be blended refiners are financially penalized, which ultimately gets passed on to consumers at the pump.

Goodlatte added, “The RFS Reform Act will eliminate corn-based ethanol requirements, cap the amount of ethanol that can be blended into conventional gasoline at 10 percent, and require the EPA to set cellulosic biofuels levels at production levels. Renewable fuels play an important role in our energy policy but should compete fairly in the marketplace. This legislation will bring the fundamental reform this unworkable federal policy needs now.”

The RFS Reform Act is supported by a diverse group of more than 40 organizations.

The renewable fuels industry is aghast at the bill saying it would impede the progress of the renewable fuels industry and takes the choice out of the hands of consumers,  all while protecting the virtual monopoly that oil companies have over America’s transportation fuels.Read More

biofuels, Ethanol, RFS

Growth Energy Heads to the Hill

Joanna Schroeder

Growth Energy and its members are heading to Capitol Hill today to meet with legislators regarding the benefits of the ethanol industry. In particular, participants will discuss the value of E15, the Renewable Fuel Standard (RFS) and the issues surrounding Renewable Identification Numbers (RINs). This morning, the Growth Energy leadership team, CEO Tom Buis, and Co-Chairmen of the Board General (Ret.) Wesley Clark and Jeff Broin (POET) held a brief press call to discuss their efforts on the hill.

US Capitol at dusk photo Joanna SchroederDuring the call, Jeff Broin explained that the RFS guarantees market access to renewable fuels because the volume of ethanol in the market is controlled by the competition, the oil industry. Today, the 10 percent goal that has been created by all the laws (10 percent of all fuel blended in the U.S. contains ethanol) but the potential is much larger. Broin said the country could be at 30 percent of the fuel by 2022 if we meet the RFS goals.

Broin noted that the oil industry has done everything it can to bar market access for E15 from erecting legal and regulatory challenges to a very expensive PR campaign with misinformation. But for the RFS to be successful, the blend wall must be scaled and this can be done by allowing consumer choice at the pump with E15.

General Clark noted that the RFS is the most successful energy policy the U.S. has seen in 40 years. It’s working. But people, such as the oil industry, food industry and the poultry industry would like consumers to believe this is not the case.

“When you open market access,” said Clark, “the market will sort itself out if given the chance. “But when you’re dealing in the fuels business you’re going against the greatest economic force on the planet, which is the petroleum industry. And they’re doing everything in their power, including working through non-governmental organizations, some governments, warning them,imploring them not to move away from their exclusive reliance on petroleum. It just shouldn’t be.”

“So the RFS is the lead effort in the move to break the monopolistic grip of the petroleum industry on liquid fuels. And we’re right now with the RFS where we’re really getting traction,” Clark concluded.

Listen to the press conference here:Growth Energy Heads to the Hill

Audio, Ethanol, Growth Energy, RFS, RINS

Extreme Biodiesel to Acquire Promethean Biofuels

John Davis

extremeprometheanCombine small with community, and you might get a big deal! Biodiesel Magazine reports that small-scale refiner Extreme Biodiesel announced it wants to acquire fellow California renewable energy maker, Promethean Biofuels, a community-scale biodiesel producer and cooperative corporation that also provides waste oil and used motor oil collection services:

“This relationship between Extreme Biodiesel and Promethean has flourished over the past several years, with talks of an acquisition having taken root several months ago,” said Joe Spadafore, Extreme Biodiesel’s corporate secretary. “This is an outstanding opportunity to expand the company in the industry with a means to enter into a cooperative environment through an established company with over 300 existing clients. This addition to Extreme Biodiesel, we anticipate, can be another solid revenue-generating venue for the company.”

Extreme Biodiesel is known for its “Mini Refineries,” waterless systems that can make 600 gallons of biodiesel per day.

Biodiesel, biofuels

Stock Rising for Biodiesel Giant REG

John Davis

REG logoThings are looking up for Renewable Energy Group. According to this article on DailyPolitical.com, Piper Jaffray has increased the Iowa-based biodiesel maker’s stock price target from $9.00 to $13.00 in a research note released on Friday morning:

“We are lifting our estimates and raising our price target due to strengthening industry fundamentals where biodiesel RINs continue to improve and feedstock costs are declining. Biodiesel RINs are currently trading at ~$0.80 up from approximately $0.50 at the beginning of the quarter due to the unique ability for biodiesel RINs to qualify for both the advanced biofuel market and the ethanol market and REGI is well positioned to benefit from this opportunity. In addition to higher RINs values, feedstock costs, including soybean oil and low cost feedstocks, have been falling since February. We are adjusting our model where 1Q13 adjusted EBITDA is modestly above management’s previously guided range of $5-$15 mil and our 2Q13 adjusted EBITDA is at the high end of management’s $15-$25 mil range.,” Piper Jaffray’s analyst commented.

The article goes on to say that several other analysts have issued buy ratings for REG’s stock.

Biodiesel, REG

Building Energy & Optimum Renewables Ink Wind Deal

Joanna Schroeder

Building Energy, an Italian company involved in the production of renewable energy in Italy and numerous foreign markets, has signed a partnership agreement with Optimum Renewables for the development of a wind farm pipeline in Iowa. The agreement provides for the development of wind farms in Iowa with a total capacity of around 50 MW. Specifically, this will include the construction of a series of medium-size farms (4-5 MW each) dispersed throughout the state in a manner structured to reach the greatest possible number of local communities.

Optimum Renewables Wind FarmOptimum Renewables will identify and select opportunities for the development of the wind farms and Building Energy will act as an overall sponsor of the activities. This will involve managing the entire project cycle from the preliminary stages of negotiating with financial providers to the eventual construction and maintenance of the farms, which will be wholly owned by Building Energy.

Fabrizio Zago, CEO of Building Energy, said, “The partnership with Optimum Renewables builds on the agreements we signed with leading U.S. energy providers in 2012, and will enable Building Energy to strengthen its presence in the U.S. market, where the existing program of incentives for the development of renewable sources has just been reconfirmed. This project will be the first significant step towards diversification into wind energy taken by our company, which so far has mainly concentrated on photovoltaic technology both in Italy and abroad.”

In 2012, energy from wind farms exceeded a total capacity of 5,100 MW, or 24.5 percent of Iowa’s total energy production. The U.S. government approved the extension into 2013 of the wind power production tax credit, an incentive program which has fostered solid growth in the sector over the last few years making investing in and building wind farms attractive.

Electricity, International, Wind

Short-Term Energy & Summer Fuels Outlook Released

Joanna Schroeder

2013 Summer Gas PricesThe U.S. Energy Information Administration (EIA) has released its April Short-Term Energy and Summer Fuels Outlook. Some report highlights include the prediction that the price for West Texas Intermediate crude oil will average $94 a barrel this year, the same as last year. The international benchmark Brent crude oi is forecast to be $4 less than last year at $108 per barrel.  According to EIA Administration Administrator Adam Sieminski, there will be continued strong economic growth in the emerging economies, particularly China, could put upward pressure on oil prices, though this would be offset somewhat by Europe’s weak economy.

A colder than expected March led to increases in residential, commercial and industrial consumption for natural gas leading to a 260 million cubic feet per day increase in the 2013 estimate of total average U.S. gas consumption from last month’s forecast. “Unusually cold temperatures in March led to larger-than-expected withdrawals of natural gas from storage,” explained Sieminski. ” The 94 billion cubic feet of gas pulled out of storage for the week ending March 29 was the largest net withdrawal for this time of year since EIA began its weekly storage data collection in 2002.”

2013 Summer Diesel PricesAn expected increase in natural gas prices this year contributes to a drop in natural gas use for U.S. electric power generation, and an increase in output at coal-fired power plants according to the report. Coal’s share of U.S. electricity generation is forecast to rise to nearly 40 percent in 2013 from just over 37 percent last year, but still be less than coal’s 42 percent share in 2011. The report forecasts the rising cost of natural gas is expected to reduce its share of U.S. electricity generation to 28 percent this year from just over 30 percent last year, but this is higher than its nearly 25 percent share in 2011.

“U.S. drivers are expected to pay less for gasoline this summer, on average down 6 cents per gallon from last summer, due in large part to slightly lower crude oil prices that account for 65 percent of the pump price,” said Sieminski. With more fuel-efficient cars and trucks on the highways and expected gasoline prices below last year’s level, Americans will have lower motor fuel expenses this year.”

“For diesel fuel, the average pump price is expected to be down 1 penny this summer to $3.94 a gallon. Production of distillate fuel, which includes diesel, is forecast to be 70,000 barrels per day higher,”added Sieminski.

Electricity, Energy, Oil

Fresno, CA Gets Fuel Choice

Joanna Schroeder

Fresno, California is the home of the latest retail station offering E85 and biodiesel. Located at  4994 E. Ashlan Avenue, the Propel “Clean Mobility Station” will receive its biodiesel from Community Fuels in Stockton, CA and ethanol from Calgren Renewable Fuels in Pixley, CA.Fresno Clean Mobility Station Grand Opening

Community Fuels produces high quality biodiesel at the company’s 13 million gallons per year bio-refinery at the Port of Stockton which has been in continuous operation since 2008. Opened in 2009, Calgren’s 55 million gallon per year ethanol plant is one of the most efficient operations and lowest carbon footprint facilities in the country.

“Propel’s new station in Fresno makes it easier than ever for our fuels to reach local drivers,” said Lyle Schlyer, President of Calgren. “As Propel expands their network of stations in the area, we look forward to growing our partnership with Propel so more Central Valley drivers have convenient access to high quality, American made fuels like ours.”

According to Matt Horton, CEO or Propel, the new station model rethinks the traditional gas station, providing a highly visible platform to introduce the renewable fuels to a mainstream driver base alongside conventional fuel options.

Propel - Fresno Price Sign“Rapid swings in fuel prices are a constant reminder of our need to increase choice and competition in the fuel market,” said Horton. “And as more consumers embrace local, renewable fuels and seek cleaner means of transportation, Propel Clean Mobility Centers will help make progress toward our country’s most pressing economic and environmental issues.”

Clean Mobility Centers utilize green design and sustainability practices that promote cleaner transportation in the communities they serve. Each station has free air stations for tires to increase vehicle miles per gallon (MPG), education centers offering information on local public transit, innovative bicycle tuning centers, recycling stations at the pump, and in the future, emerging fueling types such as natural gas and electric vehicle charging.

“Until now, Fresno’s drivers have not had the option of filling up with renewable fuels like E85 and biodiesel,” added Ashley Swearengin, Mayor of Fresno. “Our community welcomes these new choices at the pump and our city is pleased to play a role in supporting local manufacturing.”

advanced biofuels, Biodiesel, Ethanol

Oversupply Could Provide US Sugar for Ethanol

Cindy Zimmerman

Ethanol producers could get a sweet deal on sugar for ethanol if the administration approves the sale of up to 400,000 tons of surplus sugar under the 2008 Farm Bill Farm Bill Feedstock Flexibility Program.

naaj-vilsackThe program allows USDA to buy the surplus sugar and then sell it to ethanol producers at a loss in order to keep prices from going below mandated levels, but it has never been used. With large crops in the United States and Mexico causing sugar futures prices to fall below 21 cents a pound, USDA last week a proposal to the White House budget office to implement the program. “We’re doing it because it’s the law,” said Agriculture Secretary Tom Vilsack on Monday during a meeting of agricultural journalists.

However, Vilsack said it is not yet decided how much, if any of it will be used. “We’ll make that decision following a review of all the circumstances,” he said. “This is an issue where we have a significant oversupply and we have some issues that need to be resolved fairly quickly.” Those issues include storage challenges and minimizing the cost to taxpayers.

Listen to Vilsack comments here: Secretary Vilsack on sugar-to-ethanol

Audio, USDA

INL Energy Systems Laboratory Dedicated

Joanna Schroeder

The Energy Systems Laboratory (ESL) on the Idaho Falls Research and Education Campus has been official dedicated by the Idaho National Laboratory (INL). John Grossenbacher, Battelle Energy Alliance president and INL laboratory director, hosted special guests including elected officials and U.S. Department of Energy 8596211992_a1835eb9b3representatives, U.S. Rep. Mike Simpson of Idaho and Jeff Sayer, chairman of Idaho’s Leadership in Nuclear Energy (LINE) Commission and Director of Idaho’s Department of Commerce.

The new facility has 54,000 square feet of reconfigurable laboratory research space, plus a large laboratory for biomass characterization and is LEED Gold certified.

“Our new Energy Systems Laboratory adds significant research capabilities that will contribute to the timely, material and efficient transformation of America’s energy systems and infrastructure,” said Steve Aumeier, Energy and Environment associate laboratory director, who is responsible for research in the new ESL. “The impact of research at ESL is to enhance the nation’s global competitiveness by advancing energy security through integration of clean energy systems, advancement of energy storage technologies, and biomass design and analysis,” he added.

ESL contributes significantly to efforts to integrate low-carbon energy onto America’s electrical grid, reducing the nation’s dependence on foreign-sourced fossil fuels by researching bioenergy and electrical vehicle performances, and increasing energy efficiency in manufacturing, critical materials supplies and used nuclear fuel systems engineering.

advanced biofuels, Alternative energy, bioenergy, biomass