Archive for October, 2009

My small town has lost a few businesses recently. I’m sure you’ve seen the same in your towns. The picture has been pretty bleak in many rural areas around the country in recent years. That’s why it’s encouraging to learn that some of the new cellulosic ethanol projects being planned could create new jobs in areas where new jobs are sorely needed.

The December edition of Farm Industry News will publish an update on where some of the leading cellulosic ethanol projects are at in the demonstration and commercialization stage.

By the end of this year, DuPont Danisco Cellulosic Ethanol (DDCE) expects to begin producing cellulosic ethanol at a 250,000-gallon demonstration biorefinery in Vonore, TN. DDCE is a 50/50 joint venture that was formed in 2008 by DuPont and Danisco A/S.

DDCE will take what it learns from the Vonore plant and apply it to a commercial size facility, which it plans to build in the Midwest and start production in 2012. It is currently evaluating five or six different sites and expects to select the site by the end of this year. This facility will be co-located with a corn ethanol plant.

DDCE also plans to build a commercial plant in Tennessee, which would produce 15 million gallons of ethanol per year from switchgrass. This would create new markets for area farmers since the plant would require delivery from about 25,000 to 30,000 acres of switchgrass. Such a new industry would create new jobs in a state that needs them. Tennessee currently suffers from a nearly 11 percent unemployment rate.

Just how many jobs could be created? One company projects that a plant producing 15 million gallons of cellulosic ethanol per year from dedicated energy crop feedstocks could create 190 permanent jobs and 200 temporary jobs (e.g., construction jobs). A plant that produced 50 million gallons per year could create nearly 400 permanent jobs and 500 temporary positions. The numbers increase as capacity grows, and these numbers don’t even take into account local businesses (e.g., retail stores, restaurants) that would greatly benefit from having a large employer near town

Range Fuels is another example of what could become a large employer in a rural area. It is building a cellulosic ethanol plant in Soperton, Ga. Construction of this central Georgia biorefinery is currently 50 percent complete and production is expected to begin by the second quarter of 2010.

The plant will begin by producing less than 10 million gallons of cellulosic biofuels per year, but it could be scaled up to produce as much as 100 million gallons per year. Between construction jobs, biorefinery jobs, biomass handling, distribution, logistics, maintenance and more, the new biorefinery could employ more than 500 people.

The Range Fuels plant will begin by using woody biomass. But, its process could also utilize corn stover, switchgrass, municipal solid waste and other feedstocks—providing producers new market opportunities in the future.

I’ve written about the Biomass Crop Assistance Program in this blog before, and just wanted to draw your attention to a new listing of qualified biomass conversion facilities. If you have biomass to sell or are thinking about the possibility, you might want to contact the firms on this list. They are located all over the country. Visit www.fsa.usda.gov and click on the Facility Listing #14. Many of the facilities are power companies, lumber companies and so on, but I imagine we will see more cellulosic ethanol facilities as time goes on.

Cellulosic ethanol still has some hurdles to clear to bring production costs in line with gasoline. But, several companies have been working very hard to do this and are making good progress. I’m optimistic that this progress will translate into new jobs in communities that really need it.

Agriculture will have significant market opportunities ahead if Congress enacts a national renewable energy (RES) policy, says a new study conducted by the University of Tennessee’s (UT) Bio-Based Energy Analysis Group (BEAG) and funded by the Bipartisan Policy Center (BPC).

UT researchers focused their economic study on four states: Colorado, Florida, Kansas and North Carolina. Details can be found at www.bipartisanpolicy.org and by clicking on the study title under the “Sponsored Research” box.

If an RES of 25 percent by 2025 were enacted, increases in gross receipts would range from more than $9,000 per farm in Florida to more than $43,000 per farm in Kansas. The size of the market for biomass for energy plants would vary by state and by level of the RES target.

The study’s co-author Daniel de la Torre Ugarte, professor, UT’s Institute of Agriculture, said that the “relationship between farm revenue and the stringency of an RES policy was positive, with more revenue generated under scenarios with stronger RES targets.”

“A federal RES policy has the potential to create thousands of new jobs,” added Burton English, professor at UT’s Bio-Based Energy Analysis Group and also co-author of the study.

The 25x’25 Weekly Resource (www.25×25.org) explains that an RES policy requires utilities to provide a minimum percentage of energy from renewable sources. Such policies to promote renewable energy have been adopted by 27 states and the District of Columbia, generating growing momentum for a national-level program.

A coalition of agriculture, conservation, business and other interested parties, the 25×25 Alliance will release the results of an in-depth study next month focused on the impacts on all U.S. agriculture and forestry that would result under different climate change policy scenarios, including the House-passed American Clean Energy Security Act of 2009 (ACES). This study also was conducted by the UT’s BEAG.

The 25x’25 study will look at the interplay between carbon incentives provided by climate change policy and input costs driven higher because of that policy in determining potential supply, price and geographic impacts of biomass feedstocks. The study will also report estimates of the net impact of the 25 x ‘25 goals upon biomass’s contribution to total emissions, energy use and net carbon flux.

Coskata, Inc. launched a semi-commercial-scale (or demonstration) biorefinery in Madison, PA, this week that will produce 40,000 gallons of cellulosic ethanol per year from various feedstocks. These will include woody biomass, agricultural waste, energy crops and construction waste, beginning with southern Pine. The various feedstocks will be sourced from specific regions.

The purpose of the facility will be to test the technology’s ability to be scaled up to 50-million and 100-million gallon facilities, said Matthew Hargarten, media spokesperson for Coskata. Part of the ethanol produced from the demo facility will be used at the General Motors Milford Proving Grounds for testing, as well as to other strategic partners.

General Motors has reported that it has produced more than five million flex-fuel vehicles to date, and that in the U.S. alone, there are more than 3.5 million GM flex-fuel vehicles on the road. The company has introduced 17 E85-capable models for the 2010 model year.

The Warrenville, IL-based Coskata plans to license its technology to project developers. It utilizes a three-step conversion process. First, biomass is converted to synthesis gas (gasification) which is then fermented into ethanol (bio-fermentation). The third step of the process involves the separation and recovery of ethanol (separations).

Coskata has worked with Westinghouse Plasma Corporation, whose plasma gasification technology is used on the front end of the process.

The technology will be able to reduce greenhouse gases by as much as 96 percent over conventional gasoline and also use less than half the water it takes to produce a gallon of gasoline, Coskata reports. The company adds that it will be able to produce ethanol that is as much as seven times as energy positive as the fossil fuel used in the process.

Coskata also has reported that the technology will enable ethanol to be produced at about $1.00 per gallon, which would make it very competitive with conventional gasoline.

In last week’s blog, I noted that POET will work with equipment manufacturers to help speed the process of getting corn cob harvesters into fields around its Project LIBERTY facility in Emmetsburg, IA. Well, if you’re in the Emmetsburg area on Nov. 3, you might want to attend the Project LIBERTY field day.

This event will feature live demonstrations of pre-commercial corn cob harvesting equipment. Project LIBERTY Director Jim Sturdevant says that there have been significant advances not only in the development of cob harvesting technology, but also in incentives for farmers to benefit from the new revenue steam that corn cobs will offer.

Sturdevant will provide more insight on the developing cellulosic ethanol industry in the upcoming December edition of Farm Industry News. The article will feature an update on cellulosic ethanol demo and pilot projects and how plans are progressing for commercial-scale production plants.

The Nov. 3 event at Project LIBERTY in Emmetsburg will begin at 9:30 a.m. and will feature morning and afternoon rounds of equipment demonstrations separated by lunch and a short program. To see a documentary about POET’s pilot cellulosic ethanol plant visit www.poet.com/cellulosedocumentary.htm.

AGCO Awarded Grant for Hay Project

In other news, AGCO, maker of tractors, combines and windrowers, has been awarded a grant of up to $5 million from the U.S. Department of Energy to show the viability of a hay product as a means to supply high tonnage biomass feedstocks to cellulosic biofuel producers. The project will be focused on the efficient collection and transportation of biomass to biofuel plants.

POET, the Sioux Falls, SD-based ethanol giant announced this week that it will get a $6.85 million funding increase to an existing grant from the U.S. Department of Energy. POET reports that this is the first of two funding increases from the DOE to help establish a market for corn cobs to produce cellulosic ethanol. The second increase, expected next year, is estimated to provide an additional $13.15 million.

The grant increases will play a key role in establishing corn cobs as a viable commodity and set the stage for corn cob harvesting across the U.S., reports POET. The company reports that the additional funds will be used to develop the feedstock infrastructure for cellulosic ethanol production.

POET will work with equipment manufacturers to help speed the process of getting cob-harvesters into fields around its Project LIBERTY facility in Emmetsburg, IA. Fourteen area farmers are harvesting cobs this fall with prototype equipment from a variety of manufacturers.

Meanwhile, POET will develop and test infrastructure for cob pick up, delivery and storage. This could serve as a future model for other biomass facilities.

The POET facility will be a 25-million-gallon-per-year cellulosic ethanol plant that will be connected to its existing corn ethanol plant in Emmetsburg. It is expected to begin production of cellulosic ethanol in late 2011.

This past July, POET worked with equipment manufacturers to test harvest corn cobs in Texas. At that time, Scott Weishaar, POET’s vice president of commercial development, suggested that a variety of corn cob harvesters could be on the market soon. He added, “Farmers will have a lot of ways to take advantage of corn cobs as a new revenue stream.”