Archive of the Biofuels Category

In the mid-February 2010 edition of Farm Industry News (page 24), I reported that ethanol is not a water hog. The short article noted that as production technology has advanced, ethanol plants now use an average of less than four gallons of water to produce a gallon of ethanol, down from about 10 gallons of water need to produce the same amount of ethanol a decade ago.

The article also pointed out that it can take from three to five gallons of water to produce a gallon of gasoline, depending on where conventional oil is sourced.

Just this week, POET, the Sioux Falls, SD-based ethanol producer, announced its plants to decrease water consumption in the production of ethanol by 22 percent in the next five years. POET figures that if successful, it will reduce its water consumption from an average of three gallons to 2.33 gallons to produce each gallon of ethanol. “We have seen tremendous efficiency gains in the 22 years I’ve been in this business, but we can and will continue to do better,” said Jeff Broin, POET CEO this week.

POET reports that the reductions will come from the Total Water Recovery Process that it has installed already in three of its ethanol facilities. These facilities (in Bingham Lake, Minn.; Caro, Mich.; and Hudson, S.D.) now average two to 2.5 gallons of water to produce a gallon of ethanol. At both the Caro and Hudson plants, the company has eliminated wastewater discharge by installing the Total Water Recovery system. The system, which filters and recycles water, saves the Caro plant and the city of Caro more than 118,000 gallons of discharged water per day. It saves the Hudson plant and surrounding community more than 108,000 gallons of discharged water per day.

What’s more, water leaving these plants is limited to process steam and water in the ethanol producer’s Dakota Gold dried distillers grains.

Looking at Irrigation

POET also reports that it will be surveying its feedstock producers to determine how much of their crops are irrigated.

Sangwon Suh, assistant professor, Bioproducts/Biosystems Engineering, University of Minnesota, says the water issue takes on greater significance in areas where crops are irrigated. He calculates that when both ethanol process water and irrigation are taken into account, its takes 142 gallons of water to produce a gallon of ethanol.

A study conducted by Suh and colleagues at the University of Minnesota highlights the need to promote ethanol development in states with lower irrigation rates. The study, “Water Embodied in Bioethanol in the United States,” was published in the March 10 issue of Environmental Science & Technology (http://pubs.acs.org/doi/full/10.1021/es8031067).

Since irrigation may be used on crops destined for feed grain or other products, it is impossible to assign the precise amount of water consumed only to ethanol. Improved irrigation water management is critical in areas where water is scarce, add the authors of a related study, “Consumptive Water Use in the Production of Ethanol and Petroleum Gasoline.” (M.Wu, M. Mintz, M. Wang and S. Arora, Argonne National Laboratory). The study is available at www.transportation.anl.gov/pdfs/AF/557.pdf.

I regularly receive updates from the 25×25 Alliance (www.25×25.org), a coalition of agricultural, environmental and other groups striving to produce 25 percent of the total energy consumed in the U.S. from renewable resources by 2025. The Alliance recently posted a call to all stakeholders (farmers and foresters included) to play a stronger role in creating consensus on “energy and climate policies that make sense.”

The Alliance makes a point that farmers understand all too well—that farmers operate over the long haul. “What they plant this spring is often tied to crops years in the future. Shifting to energy crops, such as those that may be grown for biomass or managed to sequester carbon, requires many to make substantial investments in production and handling equipment. If we’re going to ask our nation’s farmers to stake their families’ future on renewable energy, we have to provide them with the security of a solid, long-term policy and strong market signals.”

To do this, though, farm organizations, entrepreneurs and others are going to have to find ways to learn from each other and collaborate, capitalizing on each others’ strengths. They need to participate or get their voice heard in Washington and state capitals. Groups like the 25×25 Alliance (www.25×25.org) and Growth Energy (growthenergy.org) already have made some great strides in attracting the attention of policymakers and legislators, and they can continue to use new ideas and fresh blood.

The biofuels sector still faces a lot of opposition, and a lot of misinformation is still circulating out there. That’s one of the many reasons Farm Industry News published “20 Surprising Things You Need to Know Now” in the Mid-February issue. It provides some ammunition you can use to shoot down some of the myths being circulated about biofuels and agriculture in general.

I encourage you to counter some of the anti-biofuels arguments out there when you’re talking with your elected officials, friends and acquaintances. Write a letter to your local newspaper editors or volunteer to speak before a local Kiwanis, Jaycees or other community group.

I believe, like the 25×25 Alliance, that “America’s farms, ranches and forests are capable of supplying much needed bioenergy feedstocks without compromising their ability to feed and clothe much of the world.” Do you? Please help spread the message!

The EPA has finalized a rule implementing the renewable fuels mandate of 36 billion gallons by 2022 that was established by Congress. According to the EPA, increasing renewable fuels will reduce dependence on oil by more than 328 million barrels a year and reduce greenhouse gas (GHG) emissions more than 138 million metric tons a year when fully phased in by 2022.

Some renewable fuels must achieve GHG emission reductions—compared to the gasoline and diesel fuels they displace—to be counted toward compliance with volume standards, EPA added.

Corn-based ethanol achieves a 21% GHG reduction compared to gasoline when “dubious ideas of international indirect land use change (ILUC) are included,” the Renewable Fuels Association (RFA) states. Without ILUC, corn-based ethanol achieves a 52% GHG reduction, and cellulosic ethanol achieves a GHG reduction of 72-130 percent depending upon feedstock and conversion process. In a recent statement, the RFA said that the new RFS rules are “workable,” but that the ILUC is “problematic.”

The RFA also stated that the “EPA continues to rely on oft-challenged and unproven theories, such as international indirect land use change to penalize U.S. biofuels to the advantage of imported ethanol and petroleum.”

The RFA addresses Brazilian sugarcane ethanol, for example, in an Issue Brief, which is available at www.ethanolrfa.org. The organization adds, “despite the reliance on unproven science, the greenhouse gas benefits of all ethanol show tremendous improvements compared to gasoline.” All GHG reductions for ethanol exceed those mandated by RFS2, the RFA states.

In related news, the National Biodiesel Board (NBB) reports that in 2010, 1.15 billion gallons of biodiesel will be required to be entered into commerce. EPA classifies biodiesel as an “advanced biofuel.”

“Biodiesel has the best energy balance and the best greenhouse gas reduction of any fuel that is currently in the commercial marketplace and is the only advanced biofuel that has reached commercialization in the U.S.,” says Joe Jobe, CEO, NBB.

Growers interested in learning more about requirements for feedstock producers and other details in the final EPA ruling, can read a fact sheet at www.epa.gov/otaq/renewablefuels/420f10007.pdf.

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.