REG Reduces Debt with Seneca Payoff

Joanna Schroeder January 3, 2013

The country’s largest biodiesel producer, Renewable Energy Group (REG), has paid off its long-term debt obligations of its operating biorefinery subsidiary in Seneca, Illinois. REG Seneca, LLC retired its outstanding long-term debt obligation of $34.5 million on December 21 with cash generated from operations since April 2010. This amended and restated credit agreement went into effect April 2010 with Portigon AG (formerly WestLB AG).

“When we acquired Seneca, we believed the restrictive debt structure was appropriate because the plant was purchased out of bankruptcy. As REG Seneca came online and our state-of-the-art production technology was proven, the natural cash flow generated from this 60 million gallon refinery allowed us to pay off the debt,” said Daniel J. Oh, REG President and CEO.

Oh added, “This debt repayment makes it more likely that we will be able to grow our business, implement new refining technologies, and grow our employee base.”

advanced biofuels, Biodiesel, REG

Ethanol Industry Pleased With Tax Extensions

Joanna Schroeder January 2, 2013

Very early this morning the American Taxpayer Relief Act of 2012 was passed that included several one-year biofuel tax extensions including the Cellulosic Producer Tax Credit. While the ethanol industry was pleased with the bill, they remain outspoken that the biofuel industry needs a long-term federal commitment – not just one year.

Brooke Coleman, Executive Director of Advanced Ethanol Council responded to the passage of the bill. “The advanced ethanol industry commends President Obama and the 112th Congress for extending the cellulosic producer tax credit and accelerated depreciation allowance as part of the American Taxpayer Relief Act of 2012. Just five years after the passage of the amended Renewable Fuel Standard (RFS), the cellulosic biofuels industry is breaking through at commercial scale.”

Coleman continued, “The one year extension will allow those projects coming online to continue development while Congress acts more broadly to reform the U.S. tax code to allow new players in the energy space to compete on a level playing field with oil and gas. We look forward to working with the Obama Administration and the next Congress to ensure that we continue to grow the next generation of biofuels right here in the United States.”

In addition to the Cellulosic Producer Tax Credit, the package included the Alternative Fuel Infrastructure Tax Credit. Tom Buis CEO of Growth Energy noted that by extending the Alternative Fuel Infrastructure Tax Credit to retailers through 2013, “Congress has also taken a critical step to bring E15 to the marketplace, “providing a choice and savings to the consumer. Furthermore, this provision will help decrease our addiction to foreign oil and help the renewable fuels industry break through the blend wall.”

“However,” added Buis, ” by only extending them for one year, Congress failed to provide the necessary certainty for investors and businesses to plan for the long term, which is imperative for continued stability and growth.”

Despite extension of one-year only, there were still some achievements with the second generation biofuel producer tax credit and the special allowance for second generation biofuel plant property. The Act, says the Biotechnology Industry Organization (BIO), will incentivize both cellulosic and algae biofuel production with the renewal of the $1.01 per gallon tax credit for producers, accelerated depreciation for newly constructed facilities during 2013 and modifying these credits to include algae.Read More

advanced biofuels, AEC, algae, BIO, Growth Energy, Renewable Energy

2012 Was a Good Year

Talia Goes January 2, 2013

Before we get to results and a new poll we’d like to thank Rhea + Kaiser for being the inaugural sponsor of our ZimmPoll two years ago! We started a trend as we soon saw a number of other entities begin regular online polling!

Now let’s welcome and say thanks to our new ZimmPoll sponsor, New Holland Agriculture. We’ll be working closely with New Holland to develop timely and industry pertinent questions throughout 2013. Please feel free to chime in with your ideas and participate when you can. So, let’s get started.

Our latest ZimmPoll asked the question, ”How would you rate 2012? 1 = Poor, 5 = Excellent”

Our poll results: Thirty percent said 3; twenty six percent said 4; seventeen percent said 5; seventeen said 1; eleven percent said 2. By the looks of our poll most of you thought 2012 was a pretty good year. Hopefully, you will feel the same about 2013.

Our new ZimmPoll is now live and asks the question, ” How do you feel about the fiscal cliff compromise?” Most early industry comments we’ve seen express disappointment since we only have a temporary extension of the farm bill among other things. What do you think?

ZimmPoll

Production Tax Credit for Wind Energy Extended

Joanna Schroeder January 2, 2013

Several wind energy tax credits have been extended with the passage of the bill to avert the “fiscal cliff”. The tax credits are estimated to save up to 37,000 jobs while reviving business at nearly 500 manufacturing facilities across the U.S. according to the American Wind Energy Association (AWEA). Both the Production Tax Credit (PTC) and Investment Tax Credits for community and offshore projects will help the wind energy industry continue to grow. The bill will cover all wind projects that start construction in 2013.

Energy produced from wind set a new record in 2012 with 44 percent of new electrical generation coming from wind energy according the Energy Information Administration. Despite this accomplishment, the uncertainty over the future of the tax credits caused many manufacturing companies to idle production lines and lay off workers. AWEA said uncertain federal policies have caused a “boom-bust” cycle in U.S. wind energy development for more than a decade. A long-term commitment to policy, including the PTC could end this cycle.

“On behalf of all the people working in wind energy manufacturing facilities, their families, and all the communities that benefit, we thank President Obama and all the members of the House and Senate who had the foresight to extend this successful policy, so wind projects can continue to be developed in 2013 and 2014,” said outgoing AWEA CEO Denise Bode.

Rob Gramlich, who becomes the AWEA interim CEO on January 2, 2013 added, “Now we can continue to provide America with more clean, affordable, homegrown energy, and keep growing a new manufacturing sector that’s now making nearly 70 percent of our wind turbines in the U.S.A.”

Alternative energy, Electricity, offshore wind, Video, Wind

Second E15 Station Opens in Iowa

Joanna Schroeder January 2, 2013

The Fredericksburg Coop in Fredericksburg, Iowa is now offering E15. The station is the second in Iowa to offer consumers E15. Fredericksburg Coop is located in Northeast Iowa on Highway 18 West.

“I believe retailers see great value in offering a less expensive, cleaner, more American-made fuel option like E15 to their consumers,” said Fredericksburg Coop Petroleum Manager Steve Neuendorf. “Fredericksburg Coop is thrilled to be Iowa’s second retail station to offer E15. We see the option of E15 as a win for our customers – both motorists and farmers. And that is a win for us.”

All cars and light duty trucks manufactured after 2001 are approved to use E15 – representing nearly 85 percent of fuel use. To be approved to sell E15, a retailer must register with the EPA. The Iowa Renewable Fuels Association (IRFA) works with retailers to ensure they follow all federal and state E15 regulations.

“We’re excited to get the ball rolling again for E15 in Iowa,” added IRFA Executive Director Monte Shaw. “After the first round of retailer approvals the EPA essentially shut down the system for three months. Now the EPA is apparently back on track and Fredericksburg Coop was the first station approved. IRFA believes that Fredericksburg Coop will be the first of many stations to add the option of cheaper, cleaner E15 in 2013.”

biofuels, E15, Ethanol, Iowa RFA

RFA Pleased with Cellulosic Ethanol Credit Extension

Cindy Zimmerman January 2, 2013

The American Taxpayer Relief Act of 2012 passed by Congress on New Year’s Day includes the extension of three key ethanol related tax credits, which starts the new year off well for the ethanol industry.

“The one year extension of the cellulosic producer tax credit and accelerated depreciation provides some measure of certainty to ensure that 2013 will be a year of growth and milestones for the advanced ethanol industry,” said Bob Dinneen, President and CEO of the Renewable Fuels Association. “In addition, and equally significant, is the extension of the alternative fuel infrastructure tax credit which will accelerate E15’s entry into the marketplace this coming year.”

Dinneen says it would be better that the alternative energy provisions were extended for 5-7 years instead of just one, but it is certainly understandable. “Folks do understand that is all that was on the table and really it’s teeing up a longer conversation about what to do with our tax code,” he said. “We want to have that conversation because we want all energy tax incentives on the table” including those benefiting the oil industry.

In this edition of the Ethanol Report, Dinneen talks about the dysfunctional 112th Congress and his optimism that the 113th Congress will be better.

Listen to or download the Ethanol Report here: Ethanol Report on Congress in 2013

Subscribe to “The Ethanol Report” with this link.

Audio, Ethanol, Ethanol News, Ethanol Report, Government, RFA

Fiscal Cliff Aversion Benefits Biodiesel

Joanna Schroeder January 2, 2013

The U.S. House of Representatives burned the midnight oil of the first day in the New Year and signed the Senate’s “fiscal cliff” bill. The package includes several tax extenders items, including the reinstatement of the 2013 biodiesel blenders tax credit as well as retroactive credit for 2012. Shortly after the vote, the biodiesel industry reacted including the Renewable Energy Group (REG), the country’s largest biodiesel producer.

“We are thankful that Congress and the President support the growth of the biodiesel industry through the reinstatement of the credit and for recognizing biodiesel’s important role in energy and food security and job creation. This tax credit provides certainty for our petroleum distributor customers and, in turn, market stability for commercial biodiesel producers like us.”

The National Biodiesel Board will have something good to celebrate during its 10th Annual Conference: Momentum next month. The $1-per-gallon biodiesel tax incentive was first implemented in 2005. Congress has allowed it to lapse twice, in 2010 and again in 2012. Under the legislation approved by the House on Tuesday and first passed by the Senate on Monday, the incentive will be reinstated retroactively to Jan. 1, 2012 and through the end of 2013. Each time the tax credit lapsed, thousands of jobs were lost and production dropped.

“It’s been a long year with a lot of missed opportunity and lost jobs in the biodiesel industry. But we’re pleased that Congress has finally approved an extension so that we can get production back on track,” said Anne Steckel, vice president of federal affairs at the National Biodiesel Board (NBB). “This is not an abstract issue. In the coming months, because of this decision, we’ll begin to see real economic impacts with companies expanding production and hiring new employees.”

Randy Olson, executive director of the Iowa Biodiesel Board, added, “The passage of the biodiesel tax incentive will mean tangible job creation in Iowa and beyond. Encouraging production of American-made fuel brings economic development and energy security – two of our nation’s top priorities. This is an investment in American energy that will pay dividends. Although the federal Renewable Fuel Standard helped create market stability, one Iowa plant was forced to shut its doors temporarily. The reinstatement of the tax incentive will help Iowa biodiesel reach its full potential. In 2013, we can expect a thriving industry that contributes even more to the state’s economy.”

It is expected that President Obama will sign the package quickly. The new Congress begins on January 3, 2013 and members have stated that they will continue to work through the country’s financial issues.

advanced biofuels, Alternative energy, Biodiesel, NBB, REG

Appy New Year from Domestic Fuel

Chuck Zimmerman January 1, 2013

Appy New Year from the ZimmComm Team here on Domestic Fuel.

We’re betting that many of you now have a new smartphone or tablet. So whether it’s an iPad of any version or an Android you can get your Domestic Fuil on it most easily via the AgWired App! Within the app you’ll also find the news feeds from our other ZimmComm News Network websites, AgWired.com; PrecisionPays.com and WorldDairyDiary.com. You’ll also find our main Twitter feeds and the feed from our YouTube and Flickr accounts.

Best of all it’s Free!

So click here to find out where you can get the AgWired App and have an Appy New Year.

Company Announcement

A Look at 2012 on DomesticFuel

Joanna Schroeder December 31, 2012

2012 was a challenging year for the renewable fuels industry. The biodiesel tax credit expired, the Renewable Fuels Standard was attacked, E15 continues to be attacked and there is yet to be a Farm Bill passed. With the fiscal cliff looming, many tax credits and incentives for wind, solar and advanced renewable fuels are set to expire. This uncertainty caused the wind energy industry to lay off thousands of workers, and several companies striving to produce advanced biofuels altered their business plans to begin producing biochemicals and biomaterials instead.

But on the positive side, the Domestic Fuel industry won the battle to keep the RFS in tact, E15 is now being sold in several states, the National Defense Authorization Act of 2013 was passed ensuring the military can continue to use and develop biofuels and American Ethanol NASCAR driver Austin Dillion won Rookie of the Year. In addition, more energy was produced using renewable energy such as wind, solar and geothermal than ever before and President Obama was elected for a second term. All of these stories, plus more, were some of the Top Stories of 2012 on DomesticFuel.

We now have more than 2,100 followers on Twitter (@DomesticFuel). There were over 1200 posts on Domestic Fuel this year, with nearly 175 with audio interviews, podcasts and recorded press conferences. We covered the Iowa Renewable Fuels Summit, National Biodiesel Conference, National Ethanol Conference, Automotive Service & Repair Week, Iowa Ethanol Day, Trade Talk, Farm Progress, the 25th Annual Ethanol Conference, RFA Sponsorship of the Sturgis Motorcycle Rally and more.

As we enter a new Domestic Fuel era, we wish all of our readers, sponsors and friends a healthy, happy, prosperous and blessed new year!

Alternative energy, Miscellaneous, Renewable Energy