Ethanol. Right. Now.

Valero cites productivity of American corn growers

Valero Energy Corporation has been in the ethanol-related news lately, the nation's largest refiner and now a producer of ethanol at 7 plants purchased from VeraSun Energy.  In an August 21st article in the Ft. Dodge, Iowa Messenger, Valero cited the productivity of U.S. corn growers as reason to forget the "food vs. fuel" debate.

"The American farmer continues to increase their productivity," said Bill Day, Director of Media Relations for Valero.  "The amount of production they're getting per acre is amazing."  These increased yields translate into plenty of corn for both fuel and food, Day told the newspaper. 

Read the article "Corn stats shift Valero stance: Energy giant reverses its food vs. fuel concerns."

The Houston Chronicle also covered Valero's ethanol story in an August 24th article, "Oil refining giant finds its raw material in cornfields."  Reporter Brett Clanton writes, "Valero's major entry into the renewable fuels business marks a break with a U.S. oil and gas industry that in recent years has rarely missed an opportunity to point out flaws with corn ethanol and government policies that support it."

Another interesting note: Valero CEO Bill Klesse has recently been elected Chairman of the National Petrochemical & Refiners Association (NPRA), a group that is one of ethanol's harshest critics.  How will Valero combine these roles as both ethanol producer and head of the NPRA?  Time will tell.  Stay tuned...

Brazil's sugarcane industry rep speaks at ACE ethanol conference

Joel Velasco, Chief Representative in North America for Brazil's sugarcane industry association (UNICA), told ACE conference attendees that the U.S. and Brazil agree on 99 percent of things.  "We believe in the power of farmers and agriculture to solve many of these problems," Velasco said. 

Forty-six percent of Brazil's total energy use is considered renewable, he noted, and sugarcane makes up about 16 percent of the country's entire energy matrix.  Thanks to co-generation at the mills from burning the bagasse, sugarcane makes 3 percent of the country's electricity demand - and that may climb to 10 percent in the near future.  They don't have distillers grain to sell, but they have electricity to make, Velasco said.

Half a billion tons of cane were grown last harvest, making 7 billion gallons of ethanol.  This equals 31 billion metric tons of sugar.  Brazil's sugar output for food is up by 20 percent, responding mainly to India's shortfall in sugar production.  Velasco noted that India has shunned biofuels and now is short on sugar for food.

"There is no correlation between deforestation - it exists in Brazil, and it's a tragedy - but it has nothing to do with growing cane in Brazil or growing corn here in the U.S.," Velasco said.

In Brazil, the "gasoline" is actually E25.  Ethanol competes with gasoline and keeps gas prices in check.  "Gasoline in Brazil is now the alternative fuel," he said.

"The flex-fuel car has been very, very successful in Brazil," Velasco said, noting that General Motors does not offer a single car in Brazil that's not flex fuel today.  The Honda Civic can run on pure ethanol and meet all emissions standards in Brazil, the U.S., and in Europe.

Velasco says that Brazil supports the move to E15 in the U.S.  In UNICA's official comments to the U.S. EPA, they noted that throughout all of Brazil's many fuel changes over the years with different blends of ethanol, there were very, very few incidents with engines.  "We believe the technology is all there," he said, noting that if they could do it with 1970s automotive technology, it's probably ok today. 

Leading ethanol companies are making cellulosic ethanol happen today

Three leading companies spoke at the ACE Ethanol Conference during a panel discussion on cellulosic ethanol.  Range Fuels was represented by Bill Schafer, Senior Vice President of Business Development and Government Affairs.

Range Fuels was formed in July 2006 by Khosla Ventures and broke ground in November 2007 at its cellulosic ethanol facility in Soperton, Georgia.  This month, the company expects to be 50 percent done with construction. Construction is expected to be complete during the first quarter of next year, and they will be producing cellulosic ethanol at a commercial scale in 2010.

The Soperton facility is permitted to up to 100 million gallons of ethanol per year.  Range Fuels' technology converts the biomass into syntehsis gas, and in phase two the gas is cleaned up and converted into ethanol.  They also have a module for the co-generation of power, which Schafer noted has a pretty dramatic impact on your lifecycle GHG emissions.

Range Fuels uses a thermochemical process rather than a biochemical process because it's more flexible on feedstocks, yields are better because there's no lignin separation, and it presents a lot of product options because of the syngas.  Range Fuels is using wood as its source of biomass, a commodity they believe offers superior price stability.  Their location is in the middle of the timber belt and study as shown it is a good location because it will have minimal impact on existing indutries and supplies.  In phase 1 the company will use pulpwood and mill residuals, in phase two pre-commercial thinnings and in-forest residue, and eventually in phase 3 herbaceous energy crops.

"There are a lot of moving parts out there and it's difficult to get that legislative clarity today that we'd like to get, but what isn't in doubt is that there's a huge push behind this," Schafer said.  "The benefits that can be realized through this industry are in high demand."

Doug Berven, Director of Corporate Affairs for POET, spoke about his company's efforts to integrate cellulosic technologies with existing corn-based technologies. 

"We've been making excellent progress," Berven said.  "We're very excited about the future of cellulosic biomass."

This year POET is planning 25,000 acres of corn cob harvest to meet the needs of Project Liberty, its cellulosic biorefinery being added to its existing corn-based ethanol plant in Emmetsburg, Iowa.  They are working with ag equipment companies and with farmers on adding cob collection to the farmers' annual corn harvest.  This year four cob harvesting methods will be unveiled.  Next year 100,000 acres and 70,000 tons of cobs will be collected.

POET is producing cellulosic ethanol today at its pilot plant in Scotland, South Dakota.  By June of this year they report achieving a five-fold reduction in enzyme cost, putting the current total process cost at one dollar per gallon greater than that of the company's corn-based ethanol.

"The thing that stands in the way more than anything else is market development," Berven said.  "We are in total agreement with what Brian (Jennings) said the other day that blender pumps are the future in this country.  The blend wall is holding up potential investment in cellulosic ethanol."

TMO Renewables Inc. of the United Kingdom was represented by Associate Director of Engineering Jason Robinson.  The company has designed and built the UK's first demonstration facility for cellulosic ethanol and aims to license its technology and process to the U.S. market.  TMO's platform is a flexible and scalable industrial system, low energy costs, low enzyme requirements, short process times (hours, not days), and an operational demo facility with a fully integrated process.

TMO's demonstration plant has been operational since June 2008, and it's fully staffed running 24 hours a day, seven days a week.

"You can't just offer the industry a tin can of organisms or a portion of the process.  You really need to offer the client a fully integrated process," Robinson said.

They report having achieved a higher amount of dry solids, which translates into much lower energy costs.  TMO's process can fully utilize the biomass' sugars in less than 8 hours, unlike the 50-70 hours common in other processes.  The organism they use for conversion is "thermophilic" - it likes heat - and can convert the biomass to sugar quickly without contamination issues.  Also, no antiobiotics are added to the process.

Robinson says the company is looking at "captive" feedstocks like distillers grain or corn fiber, which can take harvesting and all the transportation issues out of the mix. 

 

Experts debate methods for calculating international land use change

At the American Coalition for Ethanol's national conference last week in Milwaukee, experts in the field of studying international land use change debated the different methods behind the calculations.  Wally Tyner, professor and energy economist in the Department of Agricultural Economics at Purdue University, and Tom Darlington, President of Air Improvement Resource (AIR) Inc. addressed the conference's general session on "Theory vs. Science: The Role of Biofuels in Low Carbon Policies and Calculating Direct and Indirect Emissions."

Tyner noted that prior to 2007, the general consensus was that corn ethanol had a 20% reduction in greenhouse gas (GHG) emissions, but then in the Energy Independence & Security Act of 2007 came the requirement that indirect land use change be considered in estimating total GHG impacts.  He stated that there are a number of issues involved in developing a lifecycle model to quantify these international changes, including how to define the boundaries, deciding what to include and not include, and working with uncertain numbers. "How uncertain are these numbers?  And they are uncertain, believe me," Tyner said.

He also mentioned the E10 blend wall, calling it "the biggest issue" facing the ethanol industry.  "It's a total block to cellulosic ethanol," Tyner said. "Cellulosic ethanol will never appear without getting over the blend wall."

Tyner believes that, based on Purdue's "GTAP" model, the range today for corn ethanol is minus 9 to minus 23 in terms of lower lifecycle emissions than gasoline.

Tom Darlington has studied the international land use change (ILUC) issue and sees what California has done with its low carbon fuels standard as potentially problematic.  Other states are looking to take up the banner on a low carbon fuels standard after California, he noted, saying "I still believe how we do a low carbon fuels standard or RFS2 is a pretty big issue."

"At this point I believe the numbers are not as high as the GTAP model and some of the other models are saying, and I'm not in one camp or the other," Darlington said.  He studied the ILUC issue about a year ago for the Renewable Fuels Association and determined that land use change could indeed be zero.

Darlington believes a higher credit should be given for the ethanol co-product distillers grain, which goes back into the livestock feed market.  He said that other models traditionally believe distillers grain replaces corn on a pound for pound basis, but a new study shows that especially in dairy cattle, swine, and poultry, distillers may replace some soy, too.  One pound of distillers grain replaces nearly 1.3 pounds of corn.  Properly accounting for that soy offset should have a land use change credit, Darlington said. 

When the models are tweaked according to Darlington's recommendations, the outcome is much more favorable for corn ethanol than under the California model, for example.

"Land use modeling is in its infancy," Darlington said.  "Regulations requiring these to be estimated are still far ahead of the models.  We believe there is great risk in making bad decisions, and they may be irreversible."

During the Q&A with the audience, Tyner said he has a couple of issues with Darlington's model, but "we have made tremendous progress in the science.  We're all working to improve all of this stuff."

The California low carbon fuels standard is another question, Tyner said, stating that "it's really tough to create a policy that puts millions of dollars on every percentage point on every different type of fuel."  Measurement becomes absolutely critical, he said, adding that "I don't think we're going to get there," to a point where we can be absolutely certain of each percentage point.

 

More mileage with ethanol?

Luke Cruff, an engineer with Ricardo (www.ricardo.com), spoke yesterday at the ACE Ethanol Conference on his "Ethanol-Boosted Direct Injection" (EBDI) project that aims to make E85 have closer to the same efficiency as gasoline.  "Ethanol has very good performance potential," Cruff said, saying there are some "very positive properties we can use."

He noted that E85 keeps the engine cooler on the intake, and helps keep knock under control. On the expansion, E85 keeps temperatures lower as well. Gasoline is significantly hotter.  These are the primary reasons you get better thermal efficiency with ethanol.

E85 has 33% lower heating value than gasoline, but in an EBDI engine, they've achieved performance of only 22% lower heating value.  Cruff said that a properly executed EBDI engine can make more low-end torque than diesel.

He said that everyone is looking at how to get more performance from an engine, and that this new technolgoy "opens up a whole new area of discussion." 

Flexible fuel vehicles are not designed for ethanol and they don't run very well on it, Cruff said.  "More mileage is possible," he concluded.

Join an online discussion on this topic at the Ethanol Collective social network: www.ethanolcollective.com.  Look for the "I Use Ethanol" discussion forum.

Lamberty invokes Lombardi to inspire ethanol industry

Ron Lamberty, the American Coalition for Ethanol’s Vice President & Director of Market Development, addressed conference attendees this afternoon in a speech geared toward illustrating the opportunities ahead of the ethanol industry.

After spending the first few years of his life just 15 miles outside of Milwaukee, Lamberty welcomed a return to Wisconsin and frequently cited the insight of football coaching great Vince Lombardi throughout his address. Lombardi once said, “Success demands singleness of purpose.” Comparing the ethanol industry to a football team, Lamberty stated that just like the quarterback, the running back and the linemen need to work together in order to be successful, so does the ethanol industry need to move differences off the table and focus on common ground.

“Nothing tears a team apart more than one team member publically complaining about the others,” Lamberty said. “A running back who talks about himself and complains about his linemen will soon find himself lying on his back in the backfield. That’s certainly bad for the running back, but it is disastrous for the team.”

Lamberty also cited, “While it’s important to have a road map to achieve a stable and growing market for ethanol, it is equally important – maybe more important – that we actually build the roads and bridges that make that road map relevant.”

Throughout its ten years in paving the roads for ethanol by developing the market, Lamberty stated that ACE has helped to pave the way for ethanol by teaching petroleum marketers the math of ethanol, and about ethanol’s value as an octane enhancer. He also cited ACE’s efforts to build bridges, such as working with petroleum retailers and convenience store owners about blender pumps. ACE has also helped to build bridges within the ethanol industry by uniting with the Renewable Fuels Association and key Corn Grower states for the Blend Your Own Ethanol Campaign, which aims to bring 5,000 blender pumps to America in the next 3 years.

Lamberty wrapped up his address by once more invoking Lombardi’s inspirational words: “The real glory is being knocked to your knees and then coming back. That’s real glory. That’s the essence of it.” To Lamberty, these words sum up the mission of today’s ethanol industry:  to achieve ‘real glory’ in the wake of strife with determination and optimism.

Jennings calls for determination, optimism in conference address

The 22nd Annual American Coalition for Ethanol Conference & Trade Show continued with comments from ACE leadership. After a short speech from ACE President Brian Wilcox, ACE Executive Vice President Brian Jennings updated conference attendees on the progress the ethanol industry has made in the past year while also highlighting work yet to be done.

Jennings stated that Americans cannot afford to cling to the past and hope for a new result on the same old energy strategies, but rather that our nation must "leave oil before it leaves us." Jennings stressed the need to move away from short-term stressors toward accomplishing long-term goals, and that these goals can only be realized with teamwork.

"No one single person, no one single organization, no one single company has a monopoly on good ideas," Jennings said. "Instead of focusing on our differences of opinion, we must focus on our common ideas. Only we can defeat ourselves."

Jennings also referred to the ethanol industry's mission as "a marathon campaign to change the status quo." In pushing for a move to make gasoline, not biofuels, the alternative fuel, Jennings states that change of this magnitude must not and cannot begin in Washington, but with people who see the value and the importance of ethanol and are determined enough to call their representatives, to write to their senators and to make political contributions.

Jennings also cited 6 opportunities for the ethanol industry to return to optimism and leave the pessimists behind:

1. Policymakers actually understand and believe in the power of the ethanol industry to change America's energy strategy, and are willing to make the changes needed to make gasoline the alternative fuel.
2. Support for the Renewable Fuel Standard (RFS) is not wavering.
3. The age of easy oil is over, but corn ethanol is growing more efficient as new technologies develop.
4. Not only does President Obama support ethanol, but he has vocalized and displayed his support for the ethanol we have today (corn ethanol), and the ethanol of the future (cellulosic ethanol and other modes of advanced technology).
5. Science supports a move to blends higher than E10, and a move to higher blends is not a matter of "if," but a matter of "when."
6. Blender pumps function as the future of infrastructure, which is why ACE has joined with the Renewable Fuels Association and key Corn Growers Associations to embark on an unprecedented campaign to bring 5,000 blender pumps to America in three years.

While Jennings recognized that ethanol is not a perfect fuel, no fuel is, and much is to be accomplished by tackling the tasks before us and focusing on the "we" instead of the "me."

Dallas Tonsager optimistic of ethanol, rural communities

The 2009 ACE Conference general session kicked off this afternoon featuring Dallas Tonsager, Under Secretary for Rural Development for the United States Department of Agriculture (USDA). Tonsager began his keynote speech by stating his loyal support of ethanol.

"Ethanol is a prime example of what we need to do in rural America," Tonsager said.

With more than 6,000 employees nationwide, Tonsager, along with the USDA, is making his efforts known by voicing and implementing tangible goals to build up rural America. In his speech, Tonsager listed several strategies to achieve these goals.

"We must ensure that rural communities are creating wealth, self-sustaining, repopulating and thriving economically," he said.

Strategies to carry out these goals include building new businesses, continuously encouraging rural communities to grow, expanding broadband communications into rural communities and allowing farmers and rural citizens to be connected with the world around them.

Addressing the importance of local food, Tonsager encouraged consumers to buy locally and build up the local and rural communities at their respective homes. "We need to think about local food systems," he said. "Most food is shipped from somewhere else even though it's grown right there."

Recognizing the current condition of the US economy, Tonsager focused much of his speech on the USDA's business and industry guaranteed loan program. By offering a source of assistance to budding rural companies, Tonsager feels optimistic. "We believe it's an opportunity," he said. "We believe in rural America."

Tonsager also touched on alternative energy, where he believes rural America can play a pivotal role. The USDA strives to constantly conduct studies, research, develop and invest in new energy, he said.

"The greener we are, the better off we are," he said.

Tonsager also briefly addressed the EPA's arguments with international land use change. He encouraged ethanol supporters to stand strong and keep voicing their opinions. "We can get science to work for us again," he said.

Following the speech, Tonsager took a few questions. When asked about implementing higher blends of ethanol into gas stations nationwide, he replied simply.

"It makes all the sense in the world."

Feedstocks of the Future

 

The breakout session “Collecting, Handling and Biorefining Next Generation Feedstocks” during Wednesday morning events at the ACE Ethanol Conference and Trade Show in Milwaukee, WI, discussed the variety of potential feedstocks for the biofuels industry and how these choices will be tailored by the geography and project of the end user. 

Spencer Swayze (Manager of Business Development for Ceres, Inc.), Mike Reese (Renewable Energy Coordinator for the University of Minnesota West Central Research and Outreach Center (WCROC)), and Larry Johnson (Consultant, North American Business Development Division for Inbicon), explored various research efforts underway to refine harvesting procedures and advance cellulosic ethanol production through efficient feedstock production, harvest, and application.

ACE, RFA, Corn Growers announce national blender pump campaign

Today the American Coalition for Ethanol, the Renewable Fuels Association, and leading corn-producing states announced an innovative, unprecedented "Blend Your Own Ethanol" campaign uniting the resources and expertise of the groups in an effort to seed 5,000 blender pumps nationwide in three years.

 

In a press conference this afternoon, Ron Lamberty (ACE Vice President / Market Development), Robert White (RFA Market Development Director), and Darrin Ihnen (National Corn Growers Association First Vice President and farmer from Hurley, South Dakota) spoke on the importance of educating America’s petroleum marketers on the opportunities of retailing ethanol through blender pumps.

 

Lamberty emphasized that the “BYOethanol” campaign will provide petroleum marketers with the facts on how blender pumps are an excellent business strategy – station owners can be ready for future fuel blends while giving their customers more choices at the pump today.  White explained how the campaign will use an expanded Web presence and interactive features, a new and informative magazine, educational opportunities at petroleum marketer events, and more.

 

According to Ihnen, growing blender pump infrastructure benefits motorists, petroleum marketers, and corn growers as growing efficiencies in corn production provide for greater opportunities to supply a growing network of ethanol producers and consumers.  Ihnen said that the "corn growers are proud to be part of this campaign" that unites the "true expertise of ACE and RFA."

 

Read the full press release here: http://www.ethanol.org/pdf/contentmgmt/BYOethanol_final_press_release_8112009.pdf

Gearing up for ACE's 22nd annual ethanol conference

We look forward to seeing many ethanol supporters this week in Milwaukee for the American Coalition for Ethanol's 22nd Annual Ethanol Conference & Trade Show.  Online registration has closed, but if you'd still like to attend, you may register on site beginning Tuesday at the Midwest Airlines Center.  The agenda for the conference can be seen at this link.

There are several ways to follow the conference proceedings online.  Check out these sites:

• Follow ACE on Twitter at "blend_ethanol" -- www.twitter.com/blend_ethanol
• Check out ACE's YouTube channel -- www.youtube.com/ACEethanol
• Discussions on conference topics in the Ethanol Collective social network -- www.ethanolcollective.com

Continue to check back here as well as we blog live from this week's event.