On Friday, January 29, DuPont Danisco Cellulosic Ethanol LLC (DDCE), the University of Tennessee and Genera Energy LLC hosted a grand opening for one of the country’s first cellulosic ethanol demonstration plants. Located in Vonore, TN, the facility will have the capacity to produce 250,000 gallons of ethanol from corn cobs and switchgrass. It is expected to begin producing ethanol on a commercial-scale basis in 2012 using 100 percent switchgrass feedstock.

Over the last three years, the University of Tennessee (UT) has implemented a switchgrass increase program. In the first two years, the project was funded by the state of Tennessee and has involved publicly-available contracts. Farmers that signed the three-year contract have been paid $450 per acre per year for their switchgrass. The program provides farmers the seed as well as technical expertise from UT’s Agricultural Extension Service.

Switchgrass is a new crop for farmers to learn, says Kelly Tiller, president and CEO, Genera Energy. (Genera Energy is a for profit company wholly owned by the University of Tennessee Research Foundation.) Planting depth, for example, is extremely important with switchgrass so agronomists have been helping farmers calibrate their drills. The small switchgrass seeds need to be planted between one-quarter and one-half inch deep.

Since this is not an irrigated crop, taking advantage of planting dates to capitalize on available moisture is also important, Tiller says. It is difficult to control grassy weeds in switchgrass and many of the chemical controls are not currently labeled for switchgrass. Genera Energy is working with major crop protection companies to get products registered for the crop, Tiller says. “With help from the UT Ag Extension Service, however, we’ve had better than a 90 percent success rate with switchgrass establishment,” Tiller says.

This year, Genera Energy is getting involved in the contracting and plans to move contracts from an acreage-based payment to a payment based on yield. Genera Energy also is offering some contracts for on-farm storage of harvested switchgrass.

Since its inception, the project has awarded contracts to farmers within a 50-mile radius of the demonstration plant. In 2008, it contracted 723 acres. This expanded to 2,000 acres in 2009, with about 40 farmers participating. In 2010, the project is expected to expand to 7,000 acres, with between 80 and 90 farmers participating. The switchgrass program has generated a lot of excitement among area farmers and several of them have increased their acreage for 2010, Tiller says.

“We’re focused on keeping supply and demand in balance,” Tiller adds. “We’re interested in moving to commercial scale ethanol production, but we’re looking at using the feedstock for co-firing energy plants for the nearer term. This will allow us to help build supplies so the entire industry can move forward.”

As participating farmers’ contracts expire, the farmers can choose to become members of the Tennessee Biomass Supply Cooperative (TBSC). Organized last fall as a “New Generation Co-op,” TBSC will coordinate production and processing operations and deliver switchgrass feedstock to end users, such as utilities that would use it to co-firing their energy plants.

Farmers involved in the project are using existing production equipment, such as mower/conditioners and round balers for harvest. They move the bales to the edge of their fields where Genera Energy picks them up with a semi-tractor trailer and then moves the feedstock either to a storage location or the biorefinery. The harvest equipment is not necessarily tailored for switchgrass, with its tough stems, so Genera Energy has been working with equipment manufacturers (including AGCO, CNH, John Deere and Vermeer) to better manage the crop.

Genera also has received a grant from the Department of Energy to develop a system whereby switchgrass can be chopped in the field and brought to field edge. There, Genera would pack it in trucks and take it to be stored in bulk. Genera Energy has modified a cotton module to reduce transportation and storage costs.

Up to one-third of a switchgrass crop is made up of lignin, which is not used in the production of cellulosic ethanol. This is separated out of the process, and can be used in the boiler to provide process heat and steam at the biorefinery. In the future, some of the lignin could be used in the production of carbon fiber and several chemical platforms which would replace petroleum-based chemical platforms, Tiller says.

POET and Magellan Midstream Partners L.P. announced last week that they will assess the feasibility of an ethanol pipeline that would stretch from South Dakota to New Jersey. If the companies find the pipeline to be feasible, it could be operational by as early as 2014.

This would make ethanol more geographically desirable, particularly in a heavily populated region where a lot of fuel is consumed, but also with its own share of ethanol skeptics.

Distribution through pipeline would be cheaper than train or truck, the way most ethanol is transported now. Anything that would help reduce fuel costs would be as welcome on the East Coast as anywhere else in the country. And, according to a report from the consulting firm LECG, the pipeline would help create as many as 80,000 jobs across the country if it were built. This would mean jobs in New Jersey and Pennsylvania as well as five states across the Midwest.

But, it won’t be easy. The Association of Oil Pipe Lines explains why in a policy paper—it points out ethanol has an affinity for water which can be picked up as the fuel flows through a pipeline. Water contaminates ethanol and makes it unusable. Pipeline companies have reported that the presence of ethanol in pipelines has led to stress corrosion cracking.

The Department of Energy (DOE) and the Department of Transportation have been researching the impact of ethanol on pipelines. In addition, Kinder Morgan began transporting commercial batches of denatured ethanol along with gasoline in a 16-inch pipeline spanning from Tampa to Orlando. The company spent $10 million in modifying the pipeline for ethanol. This included chemically cleaning the line and replacing equipment that was incompatible with ethanol.

There is also the cost. The pipeline from South Dakota to New Jersey could cost as much as $3.5 billion. “A loan guarantee with the DOE is necessary for this project to become a reality,” stated the news release from POET and Magellan. The companies added that Congress is considering amendments to the current DOE loan guarantee program to include large-scale renewable fuel pipeline projects.

Ethanol could become more geographically desirable, especially to the East Coast, but it still has miles to go.

Happy New Year! And Happy New Decade! This should be quite a decade as far as biofuels are concerned—starting with whether the EPA decides to allow 15% of ethanol to be blended into gasoline later this year and continuing on to the 30 billion gallons of renewable fuel required by 2020 under the Renewable Fuel Standard (RFS2). Over this decade, we can expect to see big advances in the commercial production of cellulosic ethanol and much more.

As we begin this new decade, many industry leaders and farmers are also focused on producing biofuels in a sustainable manner. In fact, the Sustainable Biodiesel Alliance, Austin, TX, has published Baseline Practices for Sustainability.

The Alliance will hold its annual Sustainable Biodiesel Summit, Feb. 6-7, in Grapevine, TX. For more details, visit www.sustainable-biodiesel.org. The Summit will be attended by farmers, community-scale producers and others interested in the sustainable harvesting and collection of biodiesel feedstocks as well as the sustainable biodiesel production and distribution. Bill Holmberg, chairman, Biomass Coordinating Council, American Council on Renewable Energy (ACORE), will be the keynote speaker. The Summit will include a tour of Willie’s Place at Carl’s Corner, the truck stop and biodiesel production facility invested in by singer and biodiesel promoter Willie Nelson.

The Summit is being held just prior to the National Biodiesel Conference, Feb. 7-10, also held in Grapevine at the Gaylord Texas Resort & Convention Center. For more information, visit www.biodieselconference.org/2010/conf/sessions.asp. One of the many interesting sessions at this meeting will be “Climate Change, Carbon Policy and the U.S. Biodiesel Industry.” As the National Biodiesel Board (NBB) points out, various legislative and regulatory actions to reduce greenhouse gas emissions will impact all sectors of the economy, including the biodiesel industry. This session will address how different policy options would impact the business.

Another interesting session will be “Black Gold, Texas Tea: Where Will Biodiesel Sit at the Oil Company Table?” No less than one billion gallons of biomass-based diesel per year over the next decade will be required under RFS2. NBB notes that if oil companies are not yet in the biodiesel business, the RFS will probably prompt them to add biofuels to their product lines, adding that this has “the potential to double biodiesel production in a single year.”

Similarly, oil company representatives will talk about their investments in ethanol during the National Ethanol Conference, Feb. 15-17, at the Gaylord Palms Resort & Convention Center, Kissimmee, FL. For information, visit www.nationalethanolconference.com.

Another important session for both farmers and ethanol producers will address the indirect land use change debate.

The theme for this year’s National Ethanol Conference is aptly entitled “Climate of Opportunity.” With discussions heating up over climate change, reliance on foreign oil and new job creation, this decade will indeed present a climate of opportunity for those who can produce biofuels—from feedstock to fuel—in a sustainable manner.

Valero Energy Corporation, which purchased seven of the ethanol production plants formerly owned by VeraSun Energy Corporation last spring, just announced that its wholly-owned subsidiary, Valero Renewable Fuels Co., LLC, has agreed to buy two more VeraSun ethanol plants. They are located in Linden, IN and Bloomingburg, OH.

The company also has received approval to acquire Renew Energy, an ethanol plant located near Jefferson, WI, following a bankruptcy auction held last Friday.

Each of these three ethanol facilities has a production capacity of 110 million gallons per year.

In “Do Oil and Ag Mix?” (Farm Industry News, October 2009), I reported that one of the reasons the oil industry is getting more involved in biofuel production is that it has been able to capitalize on ethanol plant bankruptcies. In that article, Bill Day, Valero’s executive director of media, said that Valero was able to buy the seven VeraSun plants for only 30% of the replacement cost for those plants.

With this week’s announcement, Valero will buy the three plants for about 41% of their replacement costs—still quite a bargain. Valero will pay $200 million for the VeraSun plants and just $72 million for the Renew Energy plant.

The Valero purchases in Indiana and Ohio should be good for farmers in those areas because those plants had been sitting idle. Valero expects to get them running again in three to six months. The Renew Energy plant has been running, but at a reduced rate of production. Valero expects it will reach full production over time.

Wanting to ensure that it has “all necessary science to make the right decision,” EPA expects to make a final decision next year on whether to increase the allowable ethanol content in gasoline to 15 percent.

In a letter to Growth Energy (which submitted a waiver requesting the allowance of up to 15 percent ethanol in gasoline or E15 last March) yesterday, EPA stated that it is continuing to evaluate component durability “when E15 is used over many thousands of miles.” The DOE is currently testing 19 vehicles to examine the long-term emissions impacts of higher ethanol blends on newer motor vehicles. At present, data are available on just two vehicles. But, EPA told Growth Energy that testing is expected to be completed on the other 12 vehicles by the end of May 2010.

EPA also wrote Growth Energy that it expects to have a significant amount of data from this study by mid-June and that, “if test results remain supportive and provide the necessary basis, we would be in a position to approve E15 for 2001 and newer vehicles in the mid-year timeframe.”

If the testing indicates potential problems, EPA may need to delay its decision until all data are in.

Growth Energy was encouraged by the letter, stating that “EPA has taken a positive step towards higher blends of clean, green and homegrown ethanol.” Tom Buis, CEO, Growth Energy, said, “We are confident the ongoing tests will further confirm the data we submitted in the Growth Energy Green Jobs Waiver and silence those critics, allowing more American-produced energy to enter the market.”

The Renewable Fuels Association, however, is concerned that the postponement of a decision “will chill investment in advanced biofuel technologies at a critical time in their development and commercialization.”

“Ethanol and a Changing Agricultural Landscape” is a new report out from the USDA’s Economic Research Service (ERS). If you raise livestock, you might be interested in reading it. There’s a chapter that addresses biofuels’ impacts on the livestock sector as well as the environment.

Over the short term, feed grain costs will likely rise as biofuel production increases. The authors (Scott A. Malcolm, Marcel Aillery and Marca Weinberg) point out that corn prices are forecast to rise by 2.2 due percent due to the 15-billion corn-based ethanol target for 2015 in the Renewable Fuel Standard (RFS). Soybean prices also are expected to rise by 2.7 percent due to higher demand for soybean oil in biodiesel production.

Livestock feeders who use distillers grains (DDGS) may help offset higher feed grain costs. However, the authors add that increased DDGS demand would result in higher prices for DDGS. Overall, higher feed prices would lead to a slight decrease in livestock numbers.

Longer term, an expansion in the ethanol industry could result in greater concentration of beef and dairy herds near ethanol production plants where there would be ready access to distillers wet grains. “Spreading manure on energy feedstock crops and potential use of animal waste for onsite power generation provide additional incentives for herd expansion near processing facilities,” Malcolm and his colleagues write. They add that ethanol’s reliance on corn as the main feedstock may “adjust to relative regional cost advantages in livestock production, potentially slowing or reversing the recent shift in animal concentrations from the Midwest.”

Read more at www.ers.usda.gov/Publications/ERR86/ERR86.pdf

Rising soybean yields have had a significant impact on biodiesel’s energy efficiency. In fact, new research from the University of Idaho and the USDA indicates that the fossil energy ratio (FER) of soybean-based diesel could reach 4.69 units of energy for every unit of fossil energy consumed over its life-cycle when average soybean yields reach 45 bushels per acre. This is projected as early as 2015.

This shows how much crop yields impact the efficiency of biodiesel production. In 1998, J. Sheehan, then at the Department of Energy’s National Renewable Energy Laboratory, found that biodiesel yielded 3.2 units of energy for every unit of fossil energy it required over its life-cycle compared to petroleum diesel which yielded just about .84 units of energy per unit of fossil energy consumed. The average soybean yield at that time was 38.9 bushels per acre.

The new study also points out that the increased use of no-till and transgenic soybeans (which have had a major effect on pesticide use) have further reduced fossil fuel requirements.

If you’re a soybean farmer, share this study with your friends as well as skeptics and let them know that biodiesel’s energy efficiency, like fine wine, keeps getting better and better. You can read “Energy Life-Cycle Assessment of Soybean Biodiesel,” A. Pradhan, et al at www.usda.gov/oce/reports/energy/ELCAofSoybeanBiodiesel91409.pdf.

If you’re thinking about planting dedicated energy crops at some point in the future, I’d suggest keeping an eye on Ceres, Inc., Thousand Oaks, CA. Ceres launched the first multi-crop energy seed brand, Blade Energy Crops (www.bladeenergy.com), last year and is currently marketing switchgrass and high-biomass sorghum varieties as feedstocks for biofuels and biopower.

Ceres announced this week that it plans to increase biomass yields of several energy grasses (including switchgrass, sorghum and miscanthus) by as much as 40% in coming years while also decreasing the use of inputs, including nitrogen fertilizer. The U.S Department of Energy has awarded Ceres a $5 million grant to develop these grasses.

“Low-input traits developed through modern genetics can provide wide-reaching benefits to the energy and agricultural sectors as well as the environment, just the type of transformational impact energy officials are looking for,” says Richard Flavell, Ceres chief scientific officer.

Ceres estimates that its traits alone could help displace 1.3 billion barrels of oil and 58 million tons of coal over a 10-year period.

Biofuels contribute significantly to America’s economy and national security. Just how significantly was symbolized by a long line of American flags streaming along the long driveway leading up to POET’s Project Liberty Field Day site and speeches by General Wesley Clark and Iowa Lt. Governor Patty Judge on Nov. 3 in Emmetsburg, IA.

“Ethanol is here now, it’s green and it’s made in America,” said General Clark, who served as the Supreme Allied Commander Europe of NATO from 1997 to 2000. Clark also serves as co-chairman of Growth Energy, an organization dedicated to decreasing America’s dependence on foreign oil, reducing greenhouse gas emissions, and expanding the use of ethanol in gasoline.

Clark told farmers and others at the field day that if the U.S. were to go from gasoline blends of 10 percent to 15 percent, we could stop importing as much as one billion barrels of oil per day. By utilizing E15, America could also stop between $300 billion to $500 billion per year from going outside the country to support leaders like Venezuela’s Hugo Chavez, who has been a critic of U.S. foreign policies.

Moreover, corn-based ethanol produces 60 percent less greenhouse gas emissions than gasoline over its entire life cycle, Clark said. Cellulosic ethanol will produce between 80-90 percent less greenhouse gas emissions than gasoline, he added.

POET, which held the field day to demonstrate new corn cob harvesting equipment, plans to produce cellulosic ethanol from corn cobs by the end of 2011. Design work has begun for a 25-million-gallon-per-year cellulosic ethanol facility, which will be attached to POET’s existing corn ethanol plant in Emmetsburg.

A full-fledged cellulosic ethanol industry could create as many as 500,000 jobs nationwide. “We have the skills and energy to take this all the way,” Clark said. He encouraged attendees to raise their voices in Washington, D.C. by joining Growth Energy’s “Growth Force,” a bipartisan group that promotes homegrown energy such as ethanol and works on government policies that, for example, would mandate E15 and challenge international indirect land use charges being weighed against U.S. agriculture. For more information, visit www.GrowthForce.org. “Growth Force is an express lane to Washington,” Clark said.

During her speech, Iowa Lt. Governor Judge recalled ethanol’s beginnings as “gasohol” and how, 30 years later, biofuels are now having a profound effect on agriculture. Judge noted that cellulosic ethanol is now here and it’s viable. Project Liberty is going to keep Iowa on the forefront of technology, she said.

Judge added that the state of Iowa is helping the cellulosic ethanol industry by providing $20 million in funding. The cellulosic ethanol industry will “help create good paying jobs at a time when Iowa needs jobs desperately.”

The state government has been working hard to increase the number of blender pumps in Iowa and also working with officials in Washington to approve the E15 waiver request.

Hundreds of farmers, government officials and others traveled to the POET Project Liberty field day in Emmetsburg, IA, yesterday, to see new corn cob harvesting equipment in action. Cobs will be the primary feedstock for POET’s 25-million-gallon-per-year cellulosic ethanol facility, which will be attached to the company existing corn ethanol plant in Emmetsburg. The company expects to begin commercial-scale cellulosic ethanol production before the end of 2011.

Sixteen equipment manufacturers have been working with POET and 14 Emmetsburg-area farmers to test cob collection equipment, and were at the field day to talk with farmers about their results.

Case IH, for example, demonstrated its Axial-Flow 8120 combine and biomass harvesting equipment at the field day. The biomass cart is attached to the combine and works as a system with all 88 Series and Axial Flow combines. The system controls are integrated into the combine’s cab for on-the-go unloading.

This cart can be quickly attached and detached from the combine for fast conversion to other crops or harvest modes. It includes an adjustable cleaning system to tailor the cob/stover sample.

Redekop Manufacturing, Saskatoon, SK, has been testing six of its cob cart units with Emmetsburg farmers. The C180 Cob Cart holds two loads from the company’s H165 Cob Harvester while on-the-go. The cart’s conveyor unloads cobs from the cart to create tapered piles of cobs. The cart requires only a low HP tractor and is powered by the tractor’s PTO and hydraulics.

AGCO was at the field day to discuss a one-pass system that combines its combine technology and a Hesston large square baler to collect and package clean corn cobs, husks and leaves into 3×4-foot square bales.

John Deere demonstrated its corn cob biomass harvesting equipment. Dean Acheson, manager, Solutions Development, John Deere Agriculture & Turf Division, said that Deere has been working on a flexible prototype that will not slow down harvest. Farmers have indicated that they do not want to be slowed down in the field if they harvest cobs in addition to grain.

Representatives from POET were on hand to talk about corn cob procurement contracts. These contracts will be for three- four- and five-year terms. The contract price for cobs will average $55 per dry ton equivalent, F.O.B. POET Project Liberty in Emmetsburg. Corn cobs will represent an entirely new revenue stream for farmers.