The Indian government has begun trials for blending 10 percent ethanol in gasoline at three pilot projects in Maharashtra and Uttar Pradesh, Petroleum Minister Ram Naik said. The pilot projects, which had earlier reported success in 5 percent blending of ethanol, are currently conducting studies on petrol doped with 10 percent ethanol, Naik said.

India begins trial for 10% ethanol

Ethanol is still fighting a cost comparison battle with wholesale gasoline. Part of this misguided pricing policy is a result of not having a clear focus on exactly why ethanol is important. Why do we have 67 ethanol plants online and more on the way? What benefits are the United States and other countries expecting to achieve by building an ethanol industry? 
 	
 We talk of energy security for America. While clearly an important issue, oil imports are not going to be single-handedly reduced by ethanol. Biodiesel, solar, wind, and fuel cells are just of few of the other emerging technologies that will help build a bridge to energy security. As long as ethanol is viewed primarily as a replacement for gasoline, it is inevitable that it will continue to be compared on a similar cost basis.
 	
 Ethanol is not gasoline. It's better than gasoline. It is not designed to replace gasoline, it is designed to enhance gasoline, to improve performance, to reduce tailpipe emissions, to provide octane, reduce toxic components and to extend the supply of gasoline. But it is not now, nor has it ever been, designed to totally replace gasoline.
 	
 The American Dairy Association has not gotten caught up in a national debate comparing the price of cream to the price of wholesale coffee. Nor has the corn sweetener industry been frustrated by having to match the price of sweeteners with the wholesale price of soft drinks. These products have a clear, well-defined mission…they simply enhance the product into which they are blended. Ethanol is a blend stock that improves the quality of the gasoline into which it is blended, so there should be little correlation between the price of ethanol and the price of gasoline.
 	
 A 10 percent ethanol blend adds nearly three octane points to gasoline. Ethanol provides significant reductions in tail pipe hydrocarbon emissions, helping the petroleum industry achieve mandated clean air standards. By adding ethanol to gasoline, toxic reduction requirements are easier for refiners to meet because of dilution. In a time when refining capacity has peaked, the addition of ethanol can be an important contributor to extending fuel supplies. All of these advantages, and more, are available to the petroleum industry when they use ethanol, plus they receive a handsome gasoline excise tax credit. Not a bad deal for a product that has all that to offer. . . but is still expected to compete on a gallon-to-gallon price basis. 
 	
 Ethanol should be priced for the value it adds. It's better than gasoline. It has better emission characteristics, it's renewable, it reduces greenhouse gas emissions, it's domestically produced, and it has enormous economic and environmental benefits - for the petroleum industry and the country. Trying to achieve a cost comparable to that of wholesale gasoline made from imported oil cheapens ethanol and opens it up for unjustified criticism. 
 

 
 Mike Bryan
 President, BBI International
 mike@bbiethanol.com

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Ethanol sells itself cheap with wholesale gas prices

The Way I See IT

USDA released its latest crop production report Sept. 12. It was slightly surprising, as national yield estimates increased by 0.2 bu/acre to 125.4. However, overall production was lowered 37 mb due to a reduction of ½ million harvested acres, now estimated at 70.5. This new estimate decreases 02/03 U.S. ending stocks by the same 37 mb as well, with USDA estimating an average farm price of $2.35-$2.75 per bushel. An interesting note, the USDA has Food, Seed & Industrial (FSI) demand up from 2.055 billion bushels the previous marketing year to 2.17 billion bushels projected demand in 02/03. This increased demand of 115 mb is stemmed mostly from corn being consumed by an increase in ethanol demand. In addition, consider world corn carryout. . . reduced by 2 mmt last month and reduced by 60.83 mmt and 35.44 mmt in 00/01 and 02/03 respectively. 
 	
 As world and U.S. corn supplies become tight, what happens to corn prices going into next spring? The next step is see what actual yield figures are coming out of the fields across the drought stricken areas. With yield estimates slacking in the far ECB and far WCB; can the areas with ideal growing conditions alter those lacking yield figures?

USDA September Crop Report

Archer Daniels Midland Co. (ADM) won federal approval this month to proceed with its highly anticipated - and publicized - $396 million acquisition of Minnesota Corn Processors after a joint venture involving a high fructose corn syrup competitor is dissolved. 
 	
 The U.S. Justice Department's antitrust division filed a proposed consent decree in early September, approving the deal if MCP's joint venture with Corn Products International Inc. (CPI) is dissolved by Dec. 31. The joint venture is one of four firms competing with ADM to sell corn syrup and high fructose corn syrup in the United States and Canada. 
 	
 Assistant U.S. Attorney General Charles James said the dissolution of the CPI venture "will ensure that purchasers of corn syrup and high fructose corn syrup continue to receive the benefits of competition: lower prices." 
 	
 The farmer-owners of MCP, the second largest U.S. ethanol producer behind ADM, approved the sale on Sept 5. Decatur-based ADM agreed in July to pay shareholders of MCP $2.90 a share, or $396 million. ADM already owned a 30 percent interest in MCP and agreed to assume debts of $240 million. ADM is acquiring MCP's corn wet-milling plants in Marshall (40 mmgy) and in Columbus, Neb (100 mmgy). 
 
 According to MCP executive Dan Thompson, about 81 percent of the 5,000 farmers who owned stakes in MCP voted to accept ADM's offer. The transaction will increase the company's share of the nation's ethanol market to 46 percent from 40 percent, analysts say.
 	

 "The combination of the MCP plants with the existing corn processing facilities of ADM will provide additional operational efficiencies and better position ADM to serve the corn sweeteners, other corn products and expanding ethanol markets," said Paul Mulhollem, ADM's president and chief operating officer. 
 	
 Subsequent to the acquisition, ADM will be forced to lay off about 110 employees at MCP's headquarters, whose jobs would have been duplicated at ADM's headquarters in Decatur.

ADM acquisition of MCP conditionally approved

MONROE, Wis. - Over 2000 people gathered here to attend the grand opening of Badger State Ethanol, LLC, Sept. 14-15. 
 	
 The ceremony, which was attended by area residents, plant employees, investors, builders and state representatives including Wisconsin Gov. Scott McCallum, marked the culmination of nearly two years of planning and construction. The event provided those in attendance with an opportunity to view the plant before it is brought online in early October, according to plant manager Richard Hanson.
 	
 The project was spearheaded by Badger State Ethanol President Dr. Gary Kramer, of Lena, Wis., and Vice President John Malchine, of Watertown, Wis. The $44 million dollar plant will employ 32 people and produce 40 mmgy and 130,000 tons of both wet and dry distillers grains. 
 	
 "We are so pleased to be in Monroe," Kramer said. "This event is a small token of our appreciation for the support we have received here. A project like this takes a tremendous amount of cooperation and Monroe has been fantastic to work with."
 	
 The plant was built by Fagen Inc. of Granite Falls, Minn., utilizing a process technology provided by ICM Inc. of Colwich, Kan. Fagen and ICM have been known to get plants running at full capacity between seven and 14 days after the initial launch. 
 
 Prime location for plant
 Malchine said the reason Monroe was chosen for the location of the plant was because it fit the requirements that both he and Kramer set forth. Those requirements included suitable rail access for transportation, gas and electric, and a "welcoming community," according to Malchine. 
 	
 "After viewing the Monroe site and talking to city officials, we were convinced that Monroe could meet our requirements," Malchine said. "Early on, the Green County Development Corporation organized a meeting with key city staff and officials to discuss utility, infrastructure and permitting issues. It was very helpful to get any concerns on the table early, and to build a relationship with those officials who could help us move the project forward."
 

 Second Wisconsin plant				
 Badger State is the second ethanol plant to open up in Wisconsin. The first plant, located in Stanley, opened its doors in July (see plant profile on page 10).
 	
 In order to build the plant, the city set up a $2.8 million tax increment financing district. The district reportedly is set up to be paid back at $280,000 per year over the course of 10 years. 
 
 City officials ‘thrilled'				
 Monroe Mayor Bill Ross said that he was thrilled with the plant's presence in Monroe, and also said that it was not only to Monroe's benefit, but also to the surrounding communities. 
 	
 Attending the ribbon cutting ceremony with McCallum was Wisconsin Secretary of Agriculture Trade and Consumer Protection Jim Harsdorf. 
 	 
 "We are building a future for Monroe and the state of Wisconsin," McCallum told the crowd. "Everything we are doing is designed to provide opportunity. I don't like us spending wild money. I want us to (grow) within our means. But when it comes to the development of jobs, I look at this as an investment."

Fagen, ICM complete Badger State Ethanol, LLC

Responding to the "worst year of wildfires on record," President Bush last month outlined an initiative - consistent with the National Fire Plan - that would allow increased thinning of forests, especially in high risk, wildland-urban interface areas where wildfires threaten communities.
 	
 The White House plan, coupled with growing industry confidence in the cellulosic conversion process, has forest service officials and biofuels experts alike considering the possibilities of utilizing forest waste as an ethanol feedstock. Bush's plan, some say, would nudge the process a step closer toward economic viability. 
 
 Plan would suspend existing legal barriers

 The recently adopted National Fire Plan calls for the timely removal of hazardous fuels from forests and the development of new markets for these materials in order to make the process profitable. The White House plan, which still needs government approval, would suspend the National Environmental Policy Act (NEPA) in 10 million acres of fire-prone forests to speed the removal of "dangerous underbrush and dead trees that serve as fuel in spreading wildfires." The president's plan would streamline the existing processes by removing several legally imposed requirements that, according to the Bush Administration, have delayed or postponed thinning projects in the past. 
 	
 Although some environmentalists and conservationists are voicing opposition to the plan, biomass experts say the president's initiative could free up a portion of an estimated 5 billion tons of wood-waste for energy use. Assuming that converting this material into ethanol will eventually be commercially viable, important questions remain: How much is out there? Is it accessible? How would it be collected? And where would the ethanol plants be located? 
 	
 Although a large-scale cellulose-to-ethanol plant has not yet been proven commercially viable, industry experts are beginning to assess questions pertaining to the collection, transportation and availability of forest thinnings as an ethanol feedstock. The numbers, although not well assessed, look promising. 
 
 What are forest thinnings?
 Generally speaking, forest thinnings are defined as small diameter trees, fallen branches and other woody debris that results from natural forest processes. The material left behind after logging - such as stumps, branches woody debris, etc. - is referred to as "residue," and is often distinguished from forest thinnings. 
 	 
 Once dry, these materials can become highly flammable and very hazardous. It is generally accepted that removing forest thinnings can help reduce the risk of wildfire. 
 	 
 However, said Jerry Payne, U.S. Forest Service Southwest Region Biomass Utilization Coordinator in Albuquerque, N.M., it is often difficult to precisely define forest thinnings because each forest may require a unique "prescription." 
 	
 "The material removed from a forest is really determined on a project-by-project basis," Payne told EPM. "Ideally, it would be determined cooperatively by the agencies and communities involved with the removal. We're not trying to set a standard, for example, saying all trees under a 10-inch diameter are considered forest thinnings available for energy use. Rather, what is more important to us is that we define the goal of a project in a specific area, transforming that area from some dangerous existing condition to a safer prescribed condition." 
 	
 Payne explained that fires typically spread in two ways: ground to crown, and crown to crown. Mechanical thinning usually attempts to decrease the fuel load between healthy trees, in order to stop fires from spreading. 

 	
 "With forest thinning procedures, we are removing debris, undergrowth and small-diameter trees in order to create spaces between larger trees that disrupts the flow of fire, " he said. "We know that fires, at given wind speeds, are less able to jump from one tree to another when trees are spaced properly. . . Having less (material) between trees is incredibly important to fire prevention." 
 
 How much is out there?
 As much as 5 billion tons of forest thinnings could be available nationwide, Payne estimated, but coming up with accurate nationwide numbers has not yet been accomplished. 
 	
 Scott Haase, a Denver-based consultant with McNeil Technologies, said it is difficult to say exactly how many tons of forest thinnings could be available as an energy feedstock.
 	
 "We typically gather those numbers from local fire managers (and other forest service officials)," Haase said. "It's a challenge to get the big picture."
 	
 McNeil Technologies, a consulting firm with offices in Virginia, Colorado and Seattle, is working with the Colorado Governor's Office of Energy Management and Conservation (OEMC), which received a $74,000 grant recently from the U.S. Forest Service for a project to help reduce the risk of fire in Colorado's forests. 
 	
 Colorado's Biomass Energy Project will assess potential uses and markets for small-diameter wood waste, referring to the material as "an unused byproduct of the forest restoration process." Although the project is not ethanol related (the state is more interested in power generation), it does display the potential energy value of forest thinnings. 
 	
 "To reduce the risk of fire, it is essential that hazardous fuel be removed from our forests," said Colorado Gov. Bill Owens. "The forest restoration project aims to generate thousands of tons of small-diameter wood each year."
 	

 State projects, like the one in Colorado, are beginning to provide the "big picture" view of the availability of forest thinnings nationwide. Similar projects in South Dakota, California, Washington and Oregon are providing insight as well. Furthermore, government agencies and private companies are together currently working on assessments that will help us better understand how much forest waste is available nationwide.
 
 Harvesting thinnings 
 There's no easy way for mechanical removal of forest thinnings. The job is typically accomplished using chain saws, wood chippers and logging equipment. In the case of ethanol production, the material would be loaded onto trucks and taken to a central location for processing. There are also large mechanical harvesting machines that are able to clutch trees and underbrush, shear the material off, and load it onto trucks. In this process, larger logs and branches are separated from the thinnings for commercial purposes.
 	
 Aside from the conversion challenges, harvest and transportation is the next largest economic hurdle in front of forest thinnings-to-ethanol production. The catch, Payne says, is that much of this material is being removed (or burned) from the forests anyway, at a cost to the government. 
 	
 "We‘re already paying to have it harvested," he said. "The current practice is to harvest this material and pile it up for safe burning." 
 
 Modular ethanol plants?
 Modular ethanol plants would most likely be used to process forest thinnings, Payne said. The modular plants, which at least two U.S. companies say they can build, would be set up in the middle of a forested area slated for heavy thinning. The mobile facility might produce 5, even 10 mmgy, experts say.
 	
 Colorado-based Power Energy Fuels reportedly holds the rights to a modular ethanol plant that can process 12,000 gallons per day. Other design-build firms would likely provide similar technology. 
 	
 "Support and interest is building," Payne said. "I expect that a whole lot more support for these projects will surface in the next year or two." 

 	
 There is currently some $17 million available for removing hazardous fuels from forests on private lands, and three to four times that is available for the same purposes on public lands. But long term contracts are still needed to attract private industry to the game, Payne said. 
 	
 One such program is called the "Strategy for Stewardship," and it is being offered in Arizona and New Mexico to demonstrate alternative energy generation with biomass. Other projects are being considered nationwide.
 	
 Stewardship Contracts for treatment of the wildland-urban interface is a new use of an existing pilot program. The contracts allow ten years of material to be put under contract to a company that needs to make large investments. The contracts allow the Forest Service to lower costs by trading goods (forest waste, small trees, etc.) for services (thinning the forest to protect communities at risk.) 
 	
 To relieve environmental fears about the project, Payne said, Forest Service employees have been meeting with groups and individuals to hear concerns and discuss options. 
 	
 "They have been trying to explain the vision of Stewardship Contracting relating to wildland-urban interface projects, and tweaking the proposals to mitigate concerns," Payne explained. 
 	
 With the input of the local communities, local environmental groups, local industries and the local forest officials, the existing condition would be reviewed. Together, thinning and or restoration work to be completed would be determined. 
 	
 "What needs to be removed would be proposed locally," Payne said. "The exact approach and method of removal, sale, and administration would be left to the local (group)."
 	
 The project would be considered a pilot project and would require monitoring of fire risk achieved, biological impact to the forest and habitat, and the economic impacts. 
 	

 "Right now, we're just trying to get something positive started," Payne said.

Using forest thinnings as an ethanol feedstock could contribute to fire prevention and forest health

Can the Ethanol Industry Help Prevent Forest Fires

ACE Ethanol General Manager Terry Kulesa may have said it best when he described the story of Wisconsin's first ethanol plant as a chronicle of "sweat and equity." 
 	
 Indeed, ACE Ethanol, LLC, a 15 mmgy dry-mill located on the outskirts of Stanley, Wis., is the realization of years of ambition and toil for growers and investors in the Badger State, where the facility represents a milestone in value-added ag-processing. 
 	
 Completed in early summer this year, the plant was brought online in June, a year from the start of its construction in 2001. According to its management team, the plant started up smoothly, producing the first shipments of Wisconsin-produced ethanol to market in early July.
 	
 "It feels absolutely terrific (to have finished construction and be producing ethanol)," said Alex Samardzich, president and CEO of ACE Ethanol. "It's a major triumph for the ACE investors, and for the state of Wisconsin." 
 	
 The plant consumes over 5.5 million bushels of corn annually, much of which is purchased from area farmers. The plant can store up to 500,000 bushels of corn, or a 28-day supply, on site. The ethanol produced by ACE is marketed through Williams Bio-Energy and shipped to market via rail and truck (about 50 percent being transported each way). 
 
 First 'large-scale' Wisconsin ethanol plant
 The current market for fuel ethanol in Wisconsin is about 150 million gallons per year, which had been almost entirely imported from neighboring states prior to the completion of ACE Ethanol. Today, ACE Ethanol expects to allocate much of its supply to meet this growing in-state demand. And due to its close proximity to the U.S.-Canada border, ACE Ethanol may also export some of its ethanol north to meet Canada's growing demand as well. 
 	
 Although there were previously a couple of small ethanol plants in Wisconsin, ACE Ethanol is the first of as many as five large-scale ethanol projects slated for construction in the state, according to the office of Wisconsin's Governor Scott McCallum. (Note: Badger State Ethanol, a 40 mmgy plant in Monroe, Wis., held its grand opening Sept. 14 and is expected to be brought online in early October. See page 9 for complete story).
 
 Local investors

 "The construction of ACE Ethanol was unique because we (the plant managers, investors and community leaders) each took part in the construction process. We all built this plant from the ground up," Kulesa told Ethanol Producer Magazine. "That really makes a difference in the way you feel about the completion of a project like this."
 	
 In fact, several of the 65 investors in ACE Ethanol - mostly area business owners and farmers - ended up with construction contracts on the site, Samardzich said. 
 	
 "Several of our business-owner investors also provided services during construction and development," he explained. "The electrical, concrete excavating, roadwork, scales and plant design were all done by companies that invested in the project."
 
 Designed to expand 
 In terms of size and capacity, ACE Ethanol shares a likeness to the facilities constructed in Minnesota during the 1990s, before a wave of expansions transformed many of those plants into 30 and 40 mmgy facilities. Like the Minnesota plants, ACE Ethanol too has been designed for expansion, and will likely be expanded to at least 30 mmgy in the near future. 
 	
 In terms of technology, ACE Ethanol is no throwback, however. The plant utilizes a state-of-the-art Delta-T process technology tailored to meet the facility's unique plans. 
 	
 Williamsburg, Va.-based Delta-T, which also owns 8.5 percent of ACE Ethanol, is a full-service ethanol plant design-build firm. The company is well-known for pioneering many of the recent innovations currently in use by the newest generation of ethanol plants, including the commercialization of molecular sieve dehydration, zero discharge of process wastewater, and more efficient refining/purification systems to produce high quality alcohols. The company has provided alcohol production, dehydration, and purification solutions to more than 50 clients worldwide, including projects in Russia, India and Southeast Asia, Western and Eastern Europe, Africa, the Caribbean, and South America.
 
 Inspiring ethanol dreams
 The 15 mmgy plant is, by today's standards, considered small - perhaps even rare - compared to the growingly popular 40 mmgy models, but the quality of leadership that fueled the inspiration, organization, design and construction of the plant was anything but undersized. 

 	
 The project was spearheaded by Samardzich and ACE Ethanol Vice President Norman Spooner, longtime friends and business partners who shared a dream of creating profitable, value-added ag-processing in Wisconsin. 
 	 
 Spooner, himself a farmer and feed producer, had teamed with Samardzich in the past, developing hotels in Wisconsin, Michigan and Florida. The two men said they were inspired to build an ethanol plant in Wisconsin after the state passed its incentive program in 2000. 
 	 
 "We began searching for sites in 2000," Samardzich said. "Stanley was the most progressive in its approach and we were encouraged by the town's economic development program."
 
 Samardzich told Ethanol Producer Magazine that he was impressed by the town of Stanley, in part, because it had recently encouraged the construction of a privately owned prison in town, which displayed to him a strong willingness to develop local industry. The town also had major highway and rail access, he said, which, of course, is an important requirement for an ethanol plant. 
 	
 After picking a site for the plant, the team choose Delta-T for the plant's process design and began searching for investors. After just two months, Samardzich said, they had raised over $13 million, 45 percent of the total amount needed to build the plant. The remainder of the capital was borrowed though Marshall Investments Corporation (MIC), a subsidiary of The Marshall Group, Inc. 
 	
 "After reviewing several other transactions, ACE provided the ingredients that MIC felt would make a successful project, said Dave DeBauche, a representative of the lender. "The principals of the borrowing entity brought a tremendous amount of development experience to the transaction as well as knowledge of the local agricultural market. Delta-T provided the engineering technology and with the significant equity contribution and most of the necessary permits already in place, it was a logical financing to pursue."
 
 Running their own show
 Once the project was financed, Ace Ethanol acted as its own general contractor, under the leadership of Samardzich and Spooner. 
 	

 "We didn't want the project taken out of our hands," Samardzich said. "Delta-T agreed to work closely with us to maintain the high technology standards we hired them for, yet still allow us to manage the plant's construction and operation."
 	
 Although Delta-T operates as a general contractor on ethanol projects, the company is also comfortable in the narrower role of technology and pre-engineered equipment provider, said Rob Swain, vice president and CFO of Delta-T. 
 	
 "Although ACE wanted the flexibility to bring the combined construction skills and resources of the ownership team into a technology role, we stayed involved in every area of the project to the extent that we make sure the plant runs to our standards ar the end of the day," Swain said. "We obviously had a lot of trust and respect for the ACE owners, or else we would not have entered into this kind of scope arrangement. After all, the project still has the Delta-T name on it, and that is very important to us." 
 	
 What ACE Ethanol needed, Samardzich explained, was a sure bet - an affordable, efficient and prosperous ethanol plant that used a proven process design technology. "We looked at several different process technologies, and for this particular project, Delta-T was the best fit for what we wanted to accomplish." 
 
 The Design
 Delta-T designed the plant using the latest ethanol technology, including its unique zero process wastewater system. This eliminates the need for reverse osmosis or other wastewater treatment - removing the expense of treating the water and greatly reducing the amount of fresh water needed, while saving on initial capital construction costs, according to Delta-T's Alan Belcher, project manager on ACE Ethanol.
 	
 Samardzich concurred, "Ensuring an adequate supply of water was initially an issue for this project. Our water utility partner is very pleased that we are using a lot less water than they had heard was necessary for an ethanol plant."
 	
 ACE Ethanol also has Delta-T's latest generation of distillation, dehydration, and evaporation equipment. These technologies are fully integrated into a single system, which makes the plant easier to operate, reduces energy costs, and offers Delta-T seven-year guarantee on molesieve desiccant. The ACE plant also contains a new Delta-T option to recycle heat from the distillation system to dry the distillers grains at the back end of the plant. This feature will reportedly save the plant about 15 to 20 percent on its gas bill.
 	
 According to Belcher, "ACE Ethanol was on-time and on-budget, even with a fast-track decision-making process that required Delta-T to modify some of its typical engineering procedures and scheduling to fit ACE's business culture and construction plans." 

 Belcher added, "We tip our hat to the excellent job ACE did in constructing the plant, and in recruiting a top-notch operations management team to run it. We feel this will be a very successful ethanol business, and we are happy to be a substantial owner in the plant with our ACE partners."
 
 All the extras
 The plant will produce both wet and dry distillers grains with solubles, which is marketed through Land O' Lakes. Kulesa said feedlots within a 50 mile radius of the plant are providing a good outlet for the wet coproduct. 
 	
 "Remember, this is Wisconsin," Kulesa said. "There's no shortage of dairy cattle to feed here."
 	
 Samardzich said the next phase of the business plan will be to finish the installation of a CO2 collection plant addition that's already underway, and to begin planning a plant expansion to 30 mmgy, which ACE hopes to move forward on within a year.
 	
 The ultimate decision to expand may hinge, in part, on the Senate's decision to restore full funding to the Commodity Credit Corporation (CCC) producer incentive program, Kulesa said. However, when the decision is made, Swain said, Delta-T will be ready for the task. 
 	
 "All of our plants are pre-designed for expansion," Swain said. "Our designs are specifically laid out from the beginning to accommodate the optimal placement of future equipment and construction, which makes for very easy and cost-efficient expansion." 
 	
 Already, the plant is running over capacity, Belcher said. "We've run it as high as 40 percent over capacity and, with minimal debottlenecking, it will run continuously as a 20 mmgy plant." 
 
 The staff

 ACE Ethanol employs about 30 people, under the management of Samardzich. Kulesa and plant manager Joe Winkler came to ACE together from an ethanol plant in Minnesota. Both men joined the ACE project prior to the start of construction, which was advantageous for not only them, but for the designer as well, according to Swain. 
 	
 "Having those top managers on site during construction was a big plus," Swain said. "If you can bring those people in during construction, it's always to the plant's advantage." 
 	
 The rest of the ACE Ethanol management team includes process manager Sharon Sturm, production manager Tom Aumer, maintenance manager Joe Wild, utilities manager Brad Lerum, comptroller Lamae Mallo and commodities manager Gery Steinmetz.
 
 Looking to the future
 With the ACE Ethanol online, Samardzich, Spooner, and the other investors are taking time to reflect on their achievements, while also planning for the future. 
 	
 "I look forward to the coming years and, hopefully, to an expansion of the plant sometime soon," said Samardzich. "We still have a long road ahead of us."

Delta-T Corp. designed the plant for expansion

ACE Ethanol brings Wisconsin's first 15 online

The year is 2012, and a farmer-owned ethanol plant in South Dakota - one of 10 in the state - is producing 3.2 gallons of ethanol per bushel of corn, and delivering 130 mmgy to the 10 billion gallon U.S. ethanol market.
 	
 Wishful thinking, maybe, but this futuristic scenario could become reality in less than a decade if crop scientists continue to deliver hybrids that yield more and more ethanol. Researchers are calling it a "search for the perfect ethanol corn," and it's a quest that is only beginning to unfold.
 	
 At the forefront of this science are the world's leading seed companies, such as Pioneer and Monsanto, which quietly pursue new corn hybrids created to boost ethanol production. Working cooperatively with the research arms of these corporations, researchers such as Dr. Bruce Dien, Dr. Rodney Bothast, and others are shedding new light on the mysteries of corn-ethanol research. 
 
 'Evolutionary vs. revolutionary'

 In a sense, seed companies have been tailoring corn hybrids for ethanol production for decades by increasing the corn and starch yields, thereby, keeping feedstock costs down, Dien told EPM. 
 	
 "The science has been more evolutionary than revolutionary," he explained. 
 	
 Despite the increased use of corn for ethanol production in the U.S., seed companies have not rushed to market corn cultivars specifically tailored for ethanol production. This is changing, however, as both Pioneer and Monsanto are currently working closely with ethanol producers in the search for a better ethanol corn. 
 	
 Pioneer has a Crop Genetics Research Group that has been focused on dry-grind ethanol processes for several years, while Monsanto has also established a Corn Ethanol Research & Development program to improve the genetics of corn in order to help lower ethanol's cost per gallon.
 	
 "Monsanto's Corn Ethanol program is employing grain analytics, advanced breeding, and biotechnology to develop and identify the perfect ethanol corn hybrid," said Matt Kraus, communications lead for Monsanto's ethanol division. "As part of the new Monsanto pledge, our corn ethanol program is dedicated to bringing additional economic benefits to growers and, because the majority of dry mill ethanol plants are partially owned by growers, an increase in ethanol yield would result in a significant return on investment to growers."
 	
 Doug Haefele, a senior research scientist with Pioneer, said, "I think that we've been very active in bringing knowledge about the difference corn genetics can make to the industry. But most importantly, we've started by working in a cooperative fashion with the key customers involved - dry grind ethanol producers and corn growers - in order to fully understand the market issues involved." 
 	
 Still, both companies told EPM, progress has been limited by low demand on the part of ethanol producers and growers, and scientific vigilance on the side of seed companies and researchers. 
 	
 "We are very conservative in making claims for corn hybrids until we have sufficient data to convince our industry collaborators and ourselves that the value of Pioneer HTF hybrids has been demonstrated," Haefele said. "Since the successful completion of our most recent commercial-scale testing earlier this year, we have begun making this information available to producers."
 	

 Likewise, Kraus said, Monsanto has simply been waiting for the right opportunity to market corn hybrids made for ethanol production. 
 	
 "Historically, breeders and seed companies have bred corn for (harvest) yield, not for quality of grain composition tailored for ethanol production," Kraus explained. "Therefore, as a feedstock, all corn has been perceived to be the same by growers and ethanol plant managers. That is corn iscorn is corn. Seed companies, including Monsanto, now recognize the recent, current, and future boom in expansion of the ethanol industry, and that the opportunity to optimize the genetics of the feedstock and lower ethanol production costs is a win-win for the farmer, ethanol plant, and seed company."
 	
 Agreeing with Haefele and Kraus, Dien said the demand for corn hybrids tailored for ethanol production may be most tempting to members of farmer-owned ethanol cooperatives - grower-investors with a stake in the ethanol production.
 	
 "The market is conservative," Dien said, "I think the key will be convincing ethanol producers that it is economically worthwhile to (encourage) farmers to grow particular hybrids. . .In terms of ethanol production, of course, the best corn will be that which has the lowest net cost and yields the most ethanol. In the future, it might be quite possible that producers will contract for different hybrids optimized for different marketing strategies."
 
 Starch content not everything
 Bothast and Dien, along with Dr. Steve Eckoff of the University of Illinois, and other researchers, recently published a study entitled Fate of Bt Protein and Influence of Corn Hybrid on Ethanol Production. Aside from determining the fate of Bt (Bacillus thuringiensis) when Bt-modified corn is processed into ethanol, the study also offered preliminary findings that challenge the common assumption that corn hybrids with high starch contents yield the most ethanol.
 	
 "The take home message (was) that not all starches are created equal," Bothast said. 
 	
 In the study, scientists fermented corn samples from five hybrids containing between 68 and 72 percent starch. Using a standard method, they measured the hybrids' fermentation efficiency (CE). This refers to how much of the total starch actually breaks down into the glucose sugar that gives rise to ethanol.
 	
 Representative of the study's findings are the ethanol yields and CE rating for hybrid A and hybrid C. Hybrid A, with a starch content of 68 percent, yielded 2.73 gallons of ethanol per bushel, with a CE rating of 92 percent. Hybrid C contained 72 percent starch, and yielded 2.83 gallons of ethanol per bushel. But its lower CE rating, 90 percent, meant that less of that starch actually converted into sugar, the researchers say.

 	
 "The hybrid in our study that gave the highest ethanol yield did not contain the highest starch content," Dien told EPM. "This means that while the maximum possible ethanol yield is determined by starch content, actual ethanol yield is not perfectly correlated to this factor."
 	
 The researchers were not completely surprised by the results because it is widely known that the amount of starch found in distillers grains routinely varies - meaning that the starch in some hybrids is not completely available - or digestable during fermentation. 
 	
 Still, the researchers said, the findings are considered preliminary since the five hybrids they tested are a small sampling of the hundreds now grown commercially. They also want to further verify the methods by which they obtained their results, as the research eventually could provide commercial seed companies with a protocol they could use in their corn breeding programs.
 	
 "I think a more detailed study about the mechanism behind what determines starch available for hydrolysis would be interesting," Dien said. "We are developing a better laboratory scale protocol for modeling the industrial dry grind process that includes a jet cooker. In dry-grind facilities the corn is liquefied by mixing it with direct steam in a jet cooker. We think that using a jet cooker will allow us to better predict what would happen at an actual plant. Ideally, once the list of hybrids has been shortened; a pilot plant run could be used to further verify the choice of hybrids."
 	
 So the question remains: What actually makes a hybrid's starch breakdown into simple sugars for easy fermentation? Why does starch availability differ among hybrids? 
 	
 "That's the million-dollar question," Bothast said. "It could be due to the environment in which the corn is grown, or the DNA comprising its genes and their subsequent effect on the composition of the corn itself."
 	
 Dien added, "We really don't know, but it might have to do with the starch structure, or it could also depend on how the starch is bound to the fiber portion, or there could be other explanations as well. . . It is a question that we will be examining in the future."
 
 How soon will it happen?

 If it is, as scientists are beginning to prove, possible for breeders to create corn hybrids precisely tailored for ethanol production, when will this corn be available? Who will grow it? And how will it perform for other uses? 
 	
 "It is realistic to assume that our efforts through grain analytics and advanced breeding techniques are viable - near-term and mid-term - approaches to deliver significant increases in ethanol production," said Brad Krohn, Monsanto's technical lead on ethanol projects. 
 	
 What will it mean to an ethanol plant's bottom line? According to Pioneer, the exact impact of this on the profitability of a given facility is difficult to calculate without knowledge of the input costs, selling prices, and production constraints within which that facility operates. Still, producers can make their own projections based on the increases in yield new corn may offer. 
 	
 "Our commercial-scale testing indicates that, for those facilities that have access to Pioneer HTF products, there could be an increase in ethanol yield of up to 4 percent," Haefele said. 
 	
 Monsanto was willing to guess that increasing ethanol yields by five percent could result in as much as $2 million in additional new profit for a typical 40 mmgy dry mill. 
 	
 "However, there are numerous variables to consider such when determining the value such as kinetics, DDGS quantity and quality, processing improvement, etc.," Krohn said. "Another important variable to consider is that when a plant chooses to utilize HFC hybrids not only are they utilizing higher fermenting hybrids but they also will be reducing or eliminating the hybrids that perform poorly in fermentations system which pulls the plant production yields average down. It is all about improving the feedstock quality."
 
 Regional variances, availability
 The same ethanol corn hybrids will be available to all ethanol producers, but not all hybrids are suitable for planting in all parts of the country. Growers know in detail what genetics work on their farm. Since traditional measures of productivity (bu/acre) remain the largest genetic influence on profitability, it's important that growers select hybrids that bring the greatest value to each acre of their land. Furthermore, the hybrids that work best for each ethanol plant will be dependent on environment, location, and relative maturity zone. 
 
 Any potential drawbacks?

 But what are the potential drawbacks of creating this ethanol corn hybrid? For example, will breeding corn for ethanol yield make the coproducts less suitable for other uses (e.g., animal feed and carbon dioxide for soda production)? 
 	
 "Theoretically, it defies the laws of physics that carbon dioxide captured from fermentation contains any detectable level of transgenic protein or DNA," Krohn said. "We know of no study that has been able to detect Bt protein or DNA in carbon dioxide. Therefore, this concern is largely unwarranted." 
 	
 Furthermore, the researchers said, even if Bt was detectable in coproducts, the products are safe for human consumption and have been through multiple regulatory processes.
 	
 "We realize that DDGS may possibly contain detectable amounts of transgenic protein or DNA.," Krohn said. "However, the vast majority of DDGS is not exported, and the market potential for DDGS as a domestic animal feed is very far from being saturated, but rather represents a huge opportunity for beef, poultry, and swine feedlots, as well as eastern dairy feedlots."

Accessible starch is key to the ethanol
production success of a particular hybrid

The search for a perfect ethanol corn

During the first week of September, BBI International President Mike Bryan traveled to Taiwan on behalf of the U.S. Grains Council to discuss the options for replacing MTBE with ethanol. 
 	
 "The discussions were fruitful," said Bryan, "The trip served to bring a heightened awareness to the mounting concern in Taiwan over MTBE in the groundwater as well as logistical issues that may be encountered if ethanol were to be used as a replacement fuel component."
 	
 Taiwan uses approximately 7 percent MTBE in nearly 100 percent of its fuel. They have begun to encounter contamination of groundwater sources in many wells that the Environmental Protection Agency (EPA) has tested. Some wells are testing alarmingly high with over 100,000 ppb. This is compared to the California standard of 13 ppb for health concerns and 5 ppb for odor and taste. While most of the wells tested were far below the 100,000 ppb, clearly, the permeation of MTBE into the groundwater is a major concern.
 	
 Some within the Taiwanese government and oil industry, however, argue that only about 5 percent of the total population of Taiwan obtain their drinking water from groundwater sources. Most drinking water is drawn from reservoirs, rivers and lakes. Others make the obvious argument that it is still not acceptable to pollute any water, when other options are available. On an island of 22 million, 5 percent represents 1.1 million people, a sizeable number to ignore.
 	
 "During our meetings, I also pointed out that airborne MTBE tailpipe emissions can contribute significantly to surface water contamination," said Bryan. "A key senator in Taiwan is currently ready to introduce legislation to ban the use of MTBE. This action could meet with substantial resistance from oil companies in the country."
 	
 Taiwan has two major oil companies, Chinese Petroleum Corporation (CPC) and Formosa Petroleum Corporation (FPC). The government owns CPC, while FPC is a private company. There are other players in the market including Nationwide Petroleum, who has no refining capacity but does have a significant presence in terms of retail outlets. Also ESSO has a few retail stations in Taiwan. "Gas price wars, while not common, due occur," Bryan said, "In fact, the entire time I was in Taiwan, a gas price war was underway. Prices dropped as much as 20 percent before they appeared to bottom out."

 	
 CPC and FPC own the refining capacity and a lion's share of the MTBE manufacturing capacity, although, TASCO Chemical does have significant MTBE production capacity and sells their product primarily to FPC, Nationwide and ESSO. As a result, the elimination of MTBE will likely meet with stiff oil industry opposition.
 	
 The potential for ethanol production in Taiwan appears to be a viable option, with two corn refiners already present, and both agreeing to produce fuel ethanol if the market is available. A larger question seems to be whether to simply import ethanol or import corn and create domestic production. Rural economic development is not such as important a motivator as it is in the United States, and land is at a premium. However, if the cost of ethanol could be substantially less if local production were in place that could well tip the balance towards the importation of corn. The cost differential between indigenously produced MTBE and ethanol is clearly the greatest obstacle. On the other hand, if MTBE is banned and the government's options for oxygenating fuel are limited, then ethanol may play an important role.
 	
 "I think that ethanol will have a role in Taiwan's future gasoline market," Bryan said. "While it certainly will not be without opposition or obstacles, Taiwan has the potential to become a 130 million gallon market in the not too distant future."

Ethanol could be Taiwan's Future Fuel

This month, the Granite Falls Community Ethanol Plant project took another step in the right direction. The organization, which is working to build a 40 mmgy plant east of Granite Falls, submitted a registration statement with the United States Securities and Exchange Commission (SEC) seeking to raise $30 million through the sale of 30,000 limited liability membership units. The filing also states that the organization would need to carry between $25 million and $37 million in debt to fund the proposed plant. SEC reviewers have 30 days to review the filing and request changes. The organization then must do its final filing prior to starting a major equity drive. 
 	
 "If everything falls into place, it could be as soon as the middle of October that we begin the last equity drive," said Robin Spaude, project coordinator for the proposed plant. 
 	
 Spaude said the project was in a "quiet period" while the SEC registration was pending, but speculated that builders could break ground on the plant as early as spring 2003, if everything goes smoothly. Granite Falls-based Fagen, Inc., a leading ethanol plant builder, will team up with ICM, Inc. on the design and construction of the facility.
 	
 The plant would use about 15 million bushels of corn a year and create about 30 jobs. In addition to producing ethanol, the plant would also produce about 130,000 tons of DDGS.
 
 No producer payment from state 
 If built, the Granite Falls Community Ethanol Plant will not receive a producer payment from the state of Minnesota, which has capped its ethanol funding despite aggressive attempts by several groups to obtain producer credits. 
 	

 Subsequently, Spaude said, that is why the project's steering committee decided to pursue a 40 mmgy plant.
 	
 "The plant was originally slated to be a 15 million gallon facility," he told EPM. "When we realized we were loosing the battle for funds, our plans changed to 40 million gallons. We realized that a 40 (mmgy) plant without credits was almost as profitable as a 15 (mmgy) plant with producer payments. . . it's the economy of scale factor."
 	
 Nevertheless, the project investors will aggressively pursue the state's producer payment as long as there is the slightest chance of recieving it, he said. "We will go after it until it's a dead issue."
 	
 Minnesota currently has 14 ethanol plants producing about 300 million gallons of ethanol a year.

Granite Falls, Minn. project moves forward without state credits

Australian Prime Minister John Howard said this month the nation's government will remove the fuel tax exemption on ethanol and offer a short-term subsidy to domestic producers. Howard said the move toward greater use of biofuels is designed to encourage sustainable energy sources for fuel in the future. The measure is the latest in the coalition government's attempts to revitalize the sugar industry. The prime minister said that an excise tax of 38.14 Australian cents per liter will be imposed on ethanol used in petrol, which is line with the current excise applying to petrol. The government will provide a matching subsidy of 38.14 cents a liter to Australian producers of ethanol used in petrol.

Australia removes fuel tax exemption

Sioux Falls-based Broin Companies has secured a $5.3 million research grant from the U.S. DOE. The company will just about match the grant with its own money for research into new products, a company spokesman said. The grant is part of an $11.3 million biorefinery pilot project. Broin was one of six businesses to receive the DOE grant. The payments are spread out over four years. Broin Companies will use the money to develop new products created from the dry-mill process in ethanol production. The firm plans to use new coproducts from ethanol production to improve plant efficiency. The research and development will be done at the company's Scotland, S.D. plant and will create several new jobs related to the microbiology and technical work fields.

Broin wins $5.3 million grant from DOE

Developers of a combination ethanol plant and cattle feedlot north of Pierre, S.D. decided to call off the project, saying they don't have the funding. Dakota Value Capture Cooperative (DVVC) raised $29 million in investments, said Curt Mortenson, a spokesman for the project. But developers have had trouble finding a bank that would consider a $36 million loan, he said. One interested bank wanted the U.S. Department of Agriculture to guarantee the loan, but that hasn't happened, Mortenson said.The drought and downturns in the agricultural economy have hurt the project, and banks don't want to take the risk, he said. Investors will get their money back. The idea was to use corn to produce ethanol, feed the byproducts to cattle and use methane from the animals to fuel the operation.

Sully County ethanol project doubtful

The Society of Independent Gasoline Marketers of America (SIGMA) is predicting that no matter what happens with the energy bill in Congress, the ethanol provision is likely to be passed. In its weekly report, SIGMA said if there is an energy bill, "it will almost certainly contain some form of a renewable fuels standard. The ethanol provision included in the Senate-passed energy bill would require that 5 billion gallons of renewables (mainly ethanol) comprise the gasoline pool by 2012.

Sigma: ethanol provisions will pass

Tall Corn Ethanol, LLC in Coon Rapids, Iowa, has reached nameplate production capacity within 12 days of beginning operations, its designer and manager, Broin Companies, said in Mid-September. The 40 mmgy plant is owned by a partnership between Tall Corn Ethanol Cooperative and Broin Companies.

Tall Corn Ethanol reaches nameplate capacity

Thai researchers are developing technology to make tapioca-sourced alcohol at a faster than normal rate, which will speed up the process of making ethanol. Based on American know-how, the researchers are making a machine that turns white flour from cassava chips to glucose and ferments it to make alcohol, using only one container instead of the two needed in the conventional approach. The new technique could save up to 72 hours of manufacturing time,' said Klanarong Sriroth, a researcher from Kasetsart University's faculty of agro-industry. The researchers have built an ethanol plant, located in the compound of the Liquor Distillery Organisation, a state enterprise under the Finance Ministry, in Chachoengsao, as well as a distillation chamber for purifying alcohol.

New device may cut costs of making ethanol in Thailand

A new ethanol plant is planned in the Yankton-Vermillion,  S.D., area that will produce 50 mmgy from corn. An exact location has not been named, said Lisa Richardson, executive director of the South Dakota Corn Growers Association. Companies are working on a site selection, she said. The plant could reportedly be built in the next 18 months to two years.

Yankton-Vermillion area slated for ethanol plant

A new study of the comprehensive fuels agreement pending before the U.S. House-Senate energy bill conference committee confirmed that enacting the agreement will reduce costs compared with maintaining current law, according to the Renewable Fuels Association. The analysis released by the American Petroleum Institute found that enacting the fuels agreement will reduce refiner costs by two cents per gallon compared to current law. The fuels agreement would provide for a uniform, federal phase down of MTBE, eliminate the oxygenate standard, protect clean air gains, and establish a renewable fuels standard (RFS)

Analysis confirms Senate-passed fuels agreement will reduce gasoline costs

The Renewable Fuels Association (RFA) released a white paper last month highlighting the potential synergies for ethanol and fuel cells. Ethanol is easily stored and dispensed in the current fueling system and generates fewer greenhouse gas-forming emissions than conventional fuels, an RFA spokesman said, adding, tests have demonstrated that ethanol is more efficient to reform than gasoline to provide hydrogen for fuel cells. According to the paper:  "Ethanol is a renewable resource that is playing an increasingly important role in assuring the nation's air quality, improving the economic security of America's farming communities, and addressing the challenges of homeland energy security."

New RFA publication highlights synergies for ethanol and fuel cells

After 20 years in corn processing, including 13 years in the ethanol business, Richard Hanson is a professional at the top of his game. 
 	
 Today, Hanson is plant manager at Badger State Ethanol, LLC, a 40 mmgy ethanol plant recently unveiled in Monroe, Wis. (see full story about Badger State Ethanol on page 7). After 10 months in Monroe, working for ICM, Inc. on the plant's construction design and startup with ethanol plant builder Fagen Inc, Richard smoothly transitioned back into the operations side of ethanol production in August.
 	
 Hanson told Ethanol Producer Magazine "the ethanol industry will take you somewhere if you let it," and his career is proof of those encouraging words. The veteran plant manager has worked in nearly every type of ethanol production facility in the U.S., including wet-milling, dry-milling, small and large ethanol plants in both urban and rural areas, and in facilities relying on a wide array of process technologies and management styles. 
 	
 Hanson's career has taken him all over the Midwest - from Nebraska to Wisconsin and everywhere in between - but it all began near his hometown of Montevideo, Minn., where he spent 11 summers of his youth working on a family farm. 

 	
 "That's where the corn bug bit me," he said. "I was a town kid who worked and grew up on a farm in the summers." 
 	
 Those summers on the family farm directed Hanson toward a career in ag-processing, which began at the Minnesota Corn Processors (MCP) corn wet-milling plant in Marshall, Minn., in 1983. 
 	
 Just 20 years old when he joined MCP, Hanson quickly rose to the level of operator (one of four original ethanol plant operators at MCP) when the facility began producing ethanol in 1989. He stayed at the Marshall plant through 1992, during which time he played an important role in helping the plant through three expansions. 
 	
 That year, MCP moved Hanson to Columbus, Neb., to help facilitate the design and construction of the company's new wet-mill at that location. Much like his dual roles at Badger State Ethanol, Hanson moved into operations at MCP's Columbus plant when the construction was finished. He remained at the faciltiy, under the title of Ethanol Coordinator/Ethanol Area Manager until May of 1994.
 	
 That spring, Richard took advantage of an opportunity to work on a project in York, Neb., where the unique High Plains (Abengoa) plant was being assembled. After about a year at the York plant, Hanson and others were suddenly looking elswhere for work when high corn prices temporarily shut down the plant in for about six months in 1995. 
 	
 "So I went to work for Ron Fagen (Fagen, Inc., of Granite Falls, Minn.)," Hanson recalls. 
 	
 With Fagen, Hanson was stationed for about six months in Whapeton, N.D., where he consulted the builders and helped coordinate Fagen's role in the construction (mostly electrical work) of the ProGold corn processing plant (not an ethanol faciltiy).
 	
 "By 1997, I had really gotten away from production and had become a part of the construction side (of the ag-processing industry)," Hanson said.
 	

 The ethanol plant construction business was picking up and Hanson stayed with Fagen during the construction of the Broin-managed Agri-Energy, in Luverne, Minn., where he helped oversee certain aspects of construction and also handled warehouse purchasing. It was rewarding work but in 1998, Hanson said, he was ready to return to the production side of ethanol.
 	
 After working as an operations manager for Broin & Associates at Agri-Energy for about 18 months, Hanson made another move in 2000, relocating to St. Paul, Minn., to work at the "nation's first urban ethanol plant," Gopher State Ethanol. Hanson came on board - again as plant manager - about six months into the construction (retrofit) of the plant at the old St. Paul brewery.
 	
 The challenges encountered at Gopher State, of course, have been well-documented by the media, and Hanson was there during some of the most difficult times. Still, he says, he has nothing negative to say about his time in St. Paul. 
 	
 "What happened at Gopher State has changed the industry," he said. "The industry operates differently today because of what that plant has been through. Think about, for example, the popularity of thermal oxidizers that resulted after Gopher State had to install one. . . That facility changed the industry, and to some degree, I think we have changed for the better."
 	
 Hanson remained at Gopher State just shy of two years, departing less than a year ago for the job at Badger State. 
 	
 His reason for leaving was simple: "I really just wanted to get back to a larger facility," he said. 
 
 His industry forcast
 "I think as an industry, we are hitting a growth phase again. The 90s growth phase died off. Now we are talking about doubling and tippling the size of produiction, Hanson said. "I really can't predict where this is headed but I have a very good feeling about the industry today."
 	
 Are all ethanol production plants too strong to fade away? 

 	
 "It depends on the technology that a plant uses," he said. "The most technologically advanced, energy efficient plants will survive and do very well because they can weather out higher corn prices (like today's prices).	
 
 Industry changed, people stayed the same
 The ethanol industry, on the whole, is a tight knit familiy. You attend industry gatherings like the Fuel Ethanol Workshop (& Tradeshow) and you see old friends and catch up on what everyone is up to these days," he said. "It's always been different from other industries. Of course, things are changing - we are getting bigger as an industry, but I think that family atmosphere will remain with us for a long time yet." 
 	
 His advice for young operators that may follow Richard's path. . . 
 Hang-on, stick with it, because if you enjoy the work, it can be the ride of a lifetime - the industry is growing by leaps and bounds . This industry will take you somewhere if you let it."

From construction to production, Richard Hanson has built an interesting ethanol career

The Renewable Fuels Association (RFA) this month announced that in August the U.S. ethanol industry set an all-time monthly production record of 136,000 barrels per day (b/d), according to data released by the U.S. Energy Information Administration. The previous record of 135,000 bpd was set in January. Production for the month was up over 20 percent compared to last August when 113,000 b/d of ethanol were produced.
 	
 House and Senate energy bill conferees are currently debating the timetable for RFS implementation. The Senate passed an RFS beginning in 2004 and ramping up to 5 billion gallons per year in 2012. The House, while agreeing on a 5 billion gallon RFS, would begin implementation in 2005 and not reach 5 billion gallons until 2014.
 	
 The ethanol industry is expected to produce an annual record of approximately 2 billion gallons this year. Currently, 66 ethanol plants have the capacity to produce over 2.55 billion gallons annually. With 3 additional plants scheduled to come on-line by the end of the year, production capacity will reach 2.7 billion gallons.

Over 136,000 barrels per day produced in August

Ethanol industry sets all-time monthly record

Investors in New Jersey are talking about building a 40 mmgy ethanol plant in either Gloucester or Salem County. The plant would be the first of its kind on the East Coast, and would use both corn and sorghum as feedstocks for production. Memphis, Tenn.-based Lurgi PSI is still slated to design and build the plant. 
 	
 Garden State Ethanol Inc., a group of 12 farmers and agribusiness professionals, is planning the plant in South Jersey. Eight of the 12 farmers are from New Jersey, two from Pennsylvania, and one each from Delaware and Maryland. The group has been working on the project for several years and received a key vote of confidence in late August when New Jersey Gov. James McGreevey announced his support for the $60 million project.
 	 
 "I am committed to providing New Jersey's farmers with new opportunities to be profitable and this ethanol facility is the key to providing a major new market for our grain growers," said McGreevey. "As we move forward with this important project, we will work closely with Garden State Ethanol in a true public/private partnership," he added. 

 	
 New Jersey Agriculture Secretary Charles Kuperus will be responsible for coordinating the state's effort to help identify funding assistance for the $60 million project. "As we look to strengthen New Jersey's agricultural industry, we are developing innovative strategies to encourage economic expansion in every sector of the industry," said Kuperus. 
 	
 If built, investors say, the plant will be at a key advantage because of its proximity to companies that buy ethanol, namely oil refiners in southeastern Pennsylvania, Delaware and south Jersey. 
 	
 "These things have gone up where there's a proliferation of corn," said Ed Stahl, the company's project coordinator. "The other side of that coin is to put the plant where the end users are." 
 	
 New Jersey produces two-thirds of the bushels the plant would need per year. Some corn likely would be imported from Pennsylvania and other neighboring states, Stahl said.

New Jersey project gains state support, examines sites

The U.S. EPA announced it has reached an agreement with 12 ethanol plants in Minnesota regarding new plant emissions data collected earlier this year. The ethanol industry responded quickly to the new data to determine what emissions controls would be required to address the questions of the EPA and state agencies. The cooperative process between the regulators and the ethanol industry yielded its first resolution less than four months after the EPA and industry representatives met in Chicago on June 3rd to discuss the new emissions data. A new test procedure found plant emissions that were heretofore unknown to both the ethanol industry and the state and federal regulators.
 	
 Bob Dinneen, RFA president, said, "The ethanol industry said it would address the EPA's new data in a quick and comprehensive manner. We have. In fact, this is one of the quickest resolutions to issues of this type in the history of the EPA.. I think it should be noted that these ethanol producers did not delay and did not go to court. The cooperative response will guarantee that necessary modifications are implemented in the quickest possible timeframe. The public was the real winner today."

Minnesota producers reach quick resolution with EPA

Fifty-one bioenergy and ethanol plant managers signed a letter last month that went to the Senate Appropriations Subcommittee. The letter rebuked members of the subcommittee for not fully funding an ethanol production incentive program in the 2003 Agriculture Appropriations bill. 
 
 The letter urges the full Senate to leave the funding for the Commodity Credit Corporation's (CCC) Bioenergy Program at its full amount of $150 million. The agriculture subcommittee passed the $74 billion appropriations bill a few months ago, only providing $50 million for the CCC Bioenergy Program. The program makes cash payments to companies that increase their purchases of crops to expand production of ethanol, biodiesel or other biofuels. 
 	
 The following is a partial transcription of the letter:

 	
 "The need for a strong, domestic agriculture sector has never been greater and we commend you for your leadership through many years of difficult economic times. Specifically, we appreciate the years of contribution and support you have provided to the renewable fuels industry, including the recent appropriation of $50 million to the newly legislated Commodity Credit Corporation (CCC) Bioenergy Program. 
 	
 In as much as we appreciate your efforts in these difficult budget times, it appears the need for the program will exceed $50 million. In fiscal year 2003, ,we estimate 19 new ethanol production facilities and several existing facilities will increase eligible production capacity by at least 400 million gallons from more than 150 million bushels of corn. . . The Bioenergy Program is a critical program to new ethanol and biodiesel companies because it allows them to purchase inputs (corn, soybeans, and other agricultural feedstocks) at a discount. Profitability is difficult in the first year of production for any company, and the margins in the first few years of production for new ethanol and biodiesel facilities will be exceedingly tight. 
 	
 The ethanol and biodiesel industries are two of the sectors of the nation's economy that will contribute to domestic growth and rural economic development. Production facilities across America's countryside serve as local economic engines providing high-paying jobs, capital investment opportunities, increased local tax revenue, and value-added markets for area farmers. 
 	
 Recently, a study entitled Ethanol and the Local Economy examined the local impact of a 40 (mmgy) ethanol plant. The study found that a new ethanol facility would: Provide a one-time boost of $142 million to the local economy during construction; Expand the local economic base of the community by $110.2 million each year through the direct spending of $56 million; Create 41 full-time jobs at the plant and a total of 694 jobs throughout the entire economy; Increase the local price of corn by an average of 5 to 10 cents per bushel, adding significantly to farm income in the general area surrounding the plant; Increase household income for the community by $19.6 million annually; Boost state and local sales tax receipts by an average of $1.2 million (varies depending on local rates); Provide an average of 13.3 percent annual return on investment over ten years to a farmer who invests $20,000 in an ethanol plant. 
 	
 Many ethanol and biodiesel plants, including those currently under construction, relied on a fully funded CCC Bioenergy Program as described in the 2002 Farm Bill when planning their financing. The reduction in funding for the program . . . would have a devastating effect on many of these new facilities' financial obligations. This change. . . will likely have a negative effect on the ultimate success of these new facilities. 
 	
 Therefore, we. . . urge full funding of the CCC Bioenergy Program as designated in the energy title of the 2002 Farm Bill."

Producers' letter urges full-funding of CCC program

WINTHROP, Minn. - Renewable Products Marketing Group (RPMG) recently announced that it has received commitments to market the fuel ethanol from two additional ethanol plants. 
 	
 Effective this fall, RPMG will begin marketing the ethanol produced at Central Minnesota Ethanol (CMEC). CMEC started up its 20 mmgy dry-mill facility in Little Falls, Minn., in March of 1999. 
 	
 "CMEC looks forward to working with the other facilities in RPMG and is very excited about the future of the ethanol industry." said Kerry Nixon, CMEC general manager. 

 	
 RPMG has also signed a marketing agreement with the Kearney Area Ag Producers Alliance (KAAPA). The KAAPA group will begin construction of a 40 mmgy dry mill facility east of Axtell, Neb. this fall. The KAAPA facility is scheduled to startup in early 2004. 		
 "KAAPA is excited to be marketing its ethanol through this farmer-owned marketing group" said Paul Kenney, president of KAAPA Ethanol, LLC. 
 	
 RPMG applies cooperative principles to the marketing of fuel ethanol and it is the only such association that is wholly owned and managed by its member plants. The five founding member plants of RPMG are Al-Corn Clean Fuels of Claremont, Minn.; Chippewa Valley Ethanol Company of Benson, Minn.; Corn Plus of Winnebago, Minn.; Diversified Energy Company of Morris, Minn. and Heartland Corn Products in Winthrop, Minn. 
 	
 "RPMG was formed in recognition of the unique needs of smaller, independent ethanol producers. The addition of CMEC and KAAPA plants to our marketing group will enhance our overall ability to bring value to our members" sad Ben Brown, RMPG chairman. 
 	
 Formed in 1999 with an initial volume of 55 million gallons, RPMG has grown to a 2002 volume of over 160 million gallons. With the addition of CMEC and KAAPA along with expansion gallons from the original five members, RPMG projects a marketing volume of about 250 million gallons of fuel ethanol per year by 2004.

Minnesota's RPMG announces two new producer commitments

Tulsa, Okla.-based Williams Bio-Energy told EPM in September that it does not have a buyer yet, since announcing in late June it was selling the entire sector. However, the company has reportedly discussed the sale with at least two interested parties.
 	
 "We're moving forward with business as usual and I do not have any news to report at this time," said Ron Miller, president of the division Williams is selling. "I can tell you that I do not expect much to change from a customer's perspective." 
 	
 Williams is marketing the sale of its bioenergy sector as a package, 
 which would include the 100 mmgy Pekin, Ill., plant, a 77% ownership in the 30 mmgy Aurora, Neb., plant, and 13 ethanol marketing agreements which total 300 mmgy. A company spokesperson said it could take anywhere from 30-90 days after bids were received to find a buyer and then the sale would have to be approved by the Federal Trade Commission.

Williams quiet so far about sale of bioenergy unit

Product: AgMotion Software

 
 Customer: Land O'Lakes Feed Division
 
 Background: AgMotion, a "total solution provider for multiple levels of the agri-food supply chain," has provided at least two major U.S. marketers of DDGS with windows-based software that helps the companies manage product inventory, logistics, and quality control. The St. Paul, Minn.-based company serves the technology, commodity, and risk management needs of processors, manufacturers, growers and logistics providers within the food, grain and feed industries. AgMotion Technologies, a division of AgMotion, Inc., attempts to create technology solutions that help agri-food and other commodity-driven businesses achieve greater efficiency and cost-savings across the board. 
 
 Specifying the Equipment: AgMotion Software is a web-deployed application intended to help commodity-driven organizations control costs and operate more efficiently. AgMotion's suite of software products manages the marketing, procurement, logistics and tracking aspects of the supply chain, while integrating with a variety of financial packages. 
 
 Testimony: Land O' Lakes is the second major U.S. marketer of DDGS to select AgMotion Technologies as its e-business application partner to support its Grain and Ingredient Trading Group. The company will begin using the software in October. 
 
 "The first time I saw AgMotion Software, I knew we needed it," said Jim Jolly, national manager of distillers grains for Land O' Lakes Farmland Feed. "With the explosive expansion of the ethanol industry, we are excited about the opportunities our partnership with AgMotion Technologies provides Land O' Lakes and our customers. We look forward to an ongoing relationship with AgMotion which will will result in cost reductions and increased efficiencies through numerous applications. . ."
 
 Land O' Lakes, Inc. is a $6 Billion (Sales) national food and agricultural cooperative serving family farmers from the East Coast to the West Coast. Headquartered in Arden Hills, Minn., Land O' Lakes is a leading marketer of feed, seed, plant food and crop protection products in North America. The company purchases, markets, distributes and sells DDGS nationwide. 

 "We are pleased to work with an industry leader like Land O' Lakes," said Rolf Peters, President and CEO of AgMotion. "Land O' Lakes is on the front-end of driving change in the industry, and AgMotion Software will help them widen their lead."
 
 According to AgMotion, Dakota Commodities, a division of Broin Companies, has been using AgMotion Software for over six months. Broin builds and operates ethanol plants and markets ethanol and ethanol coproducts. 
 
 "We needed a system that could support all of our ethanol plant locations without the redundant costs of installed software or inefficient information handling processes," said Jeff Broin, CEO of The Broin Companies. "This software supports our marketing, tracking, risk management, and reporting functions all in one system via the Internet. It works seamlessly with our general ledger system to deliver tangible operating efficiencies and superior customer service."
 
 AMS is helping to support Broin's Dakota Gold Certification Program, a "brand-building and identity preservation system" where end-users can make sure they are getting Broin's premium quality "Dakota Gold" brand DDGS, even if they purchase Dakota Gold through a re-seller. According to AgMotion, end-users will access proprietary data regarding each shipment via a secure Internet connection using a unique tracking identifier.

Land O' Lakes, Dakota Commodities using AgMotion software as ‘e-business solution' for DDGS marketing, management

DDGS marketers utilize computer software to manage inventory, logistics, quality control

Distillers dried grains with solubles (DDGS), a livestock feed additive, was the focus of the National Corn Growers Association (NCGA) North Central Distillers Grains Conference held last month in Prior Lake, Minn.
 	
 The sold-out event was organized by the National Corn Growers Association (NCGA), which held a similar event last year. NCGA Livestock Programs and Information Manager Tracy Snider said the reason NCGA is promoting coproducts is simple: "NCGA promotes DDGS because our members want us to," she said. "We must promote the value of ethanol and everything that comes from ethanol. Distillers grain is not only a valuable product of itself, but it adds even more value to ethanol, which is important to our growers, many of whom own their own plants."
 	
 During the meeting, AgriTalk radio broadcast live with a panel of experts including Snider. During the program, the panelists discussed issues ranging from transportation of distillers grains, to its new customers and new markets for the product.
 	
 "Everyone knows about its use in the beef market," said John Goihl, an animal nutritionist who sat on the panel, "but not everyone is aware of the benefits DDGS can provide to the swine and poultry industries. With newer ethanol plants coming online and the improvements made to the dry-grind process, a higher quality product is available for swine."
 	
 Another panelist, commodities trader Steve Markham, said DDGS are also extremely affordable. "If every pig in the U.S. had 10 percent DDGS in its diet, it could provide a 40-cent per pig reduction in the price of feed. Currently, there are 3,000 tons a day nationwide of distillers grain being produced," he said, "so there is a consistent supply of the product."
 	
 NCGA is planning to host another DDGS Conference Oct. 30-31 at the Ambassador Hotel in Amarillo, Texas. The conference will be coordinated through the Corn Producers Association of Texas. For more information, visit www. ncga.com.

NCGA holds DDGS conference in Minn., another planned in Texas

A House proposal, gaining support among those trying to craft a compromise energy bill, would give manufacturers of MTBE, the additive now widely used in gasoline and blamed for fouling drinking water supplies in numerous states, a "safe harbor" from lawsuits seeking damages. 

 	
 The liability protection, offered by Rep. Joe Barton, (R-Texas), whose state is home to major MTBE producers, is viewed as a final hurdle before approval of a politically popular measure that would triple the demand for ethanol over the next decade. MTBE would be banned nationally within four years under the measure. 
 	
 Senate sources say the House proposal for liability relief has a fair chance of being accepted by Senate negotiators. The liability provision does not preclude lawsuits against those found responsible for MTBE-laden gasoline leaking into water supplies, but would protect against suits claiming MTBE itself was a defective product.

MTBE makers seek environmental liability protection

Cindy Riley, P.E., is Biofuels Program Technology Manager at the National Renewable Energy Laboratory (NREL). Riley has a broad range of experience in the energy and enviromental industries with expertise in the technical and economic analysis of emerging alternative energy technologies. She has more thean 24 years of experience, including alternative energy research with Exxon, process design engineering with Fluor and Raytheon, and research engineering and management with NREL. Riley has been with NREL for 12 years. 
 
 EPM: Is it possible to prioritize - or rank - the importance of ethanol-related research and development that NREL is currently involved in? If so, please give EPM readers an idea of what type of ethanol-related R&D is taking center stage at NREL in 2002-2003, and what research may becoming less of a priority. 
 
 Riley: The primary objective of the DOE Biofuels Program is to develop technology for economically producing ethanol and other fuels, chemicals, and materials from lignocellulosic biomass. At the same time, we strive to work closely with the existing grain ethanol industry to increase ethanol yields per bushel. To this end we work on both improving starch-to-ethanol technology and developing technologies for ethanol production from the remaining carbohydrates in fiber and DDGS, including cellulose and hemicellulose. DOE and NREL are devoting considerable resources to lower the cost of conversion of lignocellulosic biomass into sugars as intermediates for production of ethanol as well as other chemicals. We are focusing on corn stover, a resource readily accessible to existing ethanol producers, as a model agricultural residue and the most likely first large-scale cellulosic feedstock. Chief among our R&D efforts has been DOE's cost-shared contracts with Novozymes Biotech and Genencor International to dramatically reduce the cost of cellulases, the enzymes that help break apart the tightly bound cellulose polymers. NREL is providing technical and analytic assistance to the enzyme producers. In the next two years, we hope to have cellulases that are 1/10 the cost of those available in 2001. We are also working hard at optimizing and integrating our pretreatment and fermentation systems to achieve continuous high yields of both C-5 and C-6 sugars from corn stover. We have been devoting fewer resources to feedstock research, in part because the USDA is expanding its work in that area.

 
 EPM: It's well known that NREL often works with both public and private groups - including national laboratories, universities and private industries - on a wide array of research and development. How important are these partnerships to NREL's mission and accomplishments? What kind of partnerships can we expect to see in the coming years? 
 
 Riley: Partnerships have always been very important for NREL and DOE in the area of biofuels and that importance is increasing. On the basic research side, we work closely with universities and other DOE laboratories and USDA research centers to better understand biomass production and conversion processes. Cost-shared partnerships with private industry are absolutely essential to enabling the commercialization of biofuels technologies. The primary role of the DOE Biofuels Program is to conduct the relatively high risk R&D that, once accomplished, will sufficiently reduce the technical and business risks for private companies to be willing to invest in the later and even more costly stages of demonstration and commercialization. Cost shared partnerships allow DOE to leverage its limited funds, while at the same time enabling more direct technology transfer to the private sector which hopefully results in more rapid commercialization. In the future we expect to see more partnerships with established dry and wet mill firms, as well as fuels and chemical producers who are trying to move from petroleum-based to biobased feedstocks. 
 
 EPM: One of NREL/Biofuels Program's primary functions is to research cellulose-to-ethanol processes and advance cellulase enzyme research. How would you categorize the state of cellulose-to-ethanol R&D at NREL? How far has the research come from just a few years ago? Is NREL making any predictions of its own about when cellulosic ethanol will become commercially viable on a large-scale basis?
 

 Riley: We have now clearly demonstrated effective technology for all phases of the cellulosic biomass-to-ethanol process. The challenge from here out is to bring the cost of the technology (largely a function of high capital equipment cost) down to levels where private industry will be interested in moving forward building commercial facilities. Recent innovations in pretreatment systems, enzymes, and fermenting organisms should make important contributions. The DOE target for cellulosic ethanol is to have technology sufficiently developed to support one or more commercial-scale plants built and operating by 2010. 
 
 EPM: Is NREL currently operating a biomass-ethanol pilot plant, or involved with 
 any such plant(s)? Where? In what capacity? 
 
 Riley: On our Golden campus, we operate a 1-ton per day (dry feedstock basis) process development unit, officially known as the DOE Bioethanol Pilot Plant. The Alternative Fuels User Facility or AFUF, which includes the pilot plant and other research facilities was specifically created to provide a national center where interested companies and researchers could test out various processes for converting cellulosic feedstocks to ethanol or value-added products without having to invest in their own pilot plant. For example, our pretreatment reactors are designed to safely operate with relatively high acid or base concentrations and elevated temperatures. The pilot plant is certified to safely handle recombinant organisms. All equipment is fully instrumented with more than 900 data acquisition points and can be operated at various levels of process integration. This flexibility allows our partners to quickly test various combinations of operating conditions to determine what works best for their particular feedstock, enzyme cocktail, and/or fermentative organism. 
 
 EPM: In your own words, why is the research and development conducted by NREL important to the ethanol industry? Why should, say, a general manager of a corn-ethanol plant in Iowa be concerned about what NREL is working on today? How does the research affect the ethanol industry at its basic commercial level?
 
 Riley: What NREL is working on today, the Iowa grain-ethanol plant (or his competitor) may be using in the near future. The carbohydrates that now remain in co-product animal feeds are a clear market opportunity for cellulosic ethanol production: more ethanol and higher-protein animal feed products. Also, the corn grain resource does have limits. As ethanol production increases sharply in the next eight years to replace MTBE and to meet rising demand for octane and oxygenates, there will likely be upward pressure on grain prices. The cost of the feedstock for a corn-based ethanol plant will rise, possibly squeezing profit margins. In the short run, we are working with existing ethanol plants to get higher ethanol yields per bushel, as well as investigating ways to upgrade fiber and DDG to get higher prices or to enter new animal feeding markets. In the long run, we are focused on the research that will allow future plants to produce ethanol at a price competitive with gasoline without subsidies. This will require less expensive feedstocks and highly efficient, cost-effective conversion processes. With their existing capital equipment, infrastructure, expertise, and access to cellulosic resources such as corn stover, corn-ethanol plant operators are well positioned to also produce ethanol from lignocellulosic biomass.

 
 EPM: Explain the concept of the biorefinery. What is it, and what should it mean to existing and future ethanol producers?
 
 Riley: The term biorefinery is derived, as you can guess, from the petroleum refinery. However, renewable, domestic biomass is the feedstock instead of crude oil. The key to the biorefinery concept is flexibility. The biorefinery facility will be designed to process a diverse set of feedstocks, determined largely by its specific location, and produce a slate of intermediate and end products, not just one or two. To continue the petroleum refinery analogy, petroleum refineries typically produce more gasoline in the late spring and summer, when demand and prices are highest, and less of other refined products. Future biorefineries are expected to be able to handle a changing mixture of incoming feedstocks and to maximize revenue by producing a variety of high-value products (chemicals, materials) in addition to fuels and animal feeds. For the ethanol producer, it will mean less volatility in income as corn or milo prices rise and fall. The biorefinery may substitute agricultural residues for some of its grain feedstock when corn prices rise and adjust its product slate accoringly. In DOE's efforts to create successful biorefineries we emphasize taking maximum advantage of available feedstocks and conversion technologies to produce a range of products from high-value/low-volume chemicals and materials to high-volume/low-value fuels. High-value bioproducts may catch market excitement in the near term but large volumes of fuels are what the country needs to reduce our dependence on foreign oil and improve the environment.
 
 EPM: In your view, what is the most promising emerging biomass-to-ethanol conversion processes being developed today? 
 
 Riley: In order for DOE to achieve its long-term target of ethanol competitive with gasoline we have recently renewed emphasis on understanding the fundamental science, especially the chemistry, of biomass and its conversion to sugar intermediates at high efficiency and low cost. The core lignocellulosic biomass-to-ethanol technology elements for the Biofuels Program include dilute-acid pretreatment to hydrolyze hemicellulose, enzymes to hydrolyze cellulose, and co-fermentation of C-5 and C-6 sugars. We are currently examining the full range of pretreatment technologies being researched around the world to identify those that have the most potential to meet the technical and cost targets needed by biorefineries in the future. We are also looking at a variety of hydrolysis and fermentation strategies to take advantage of the full complement of sugars derived from biomass and their different product opportunities. Biotechnology advances are enabling rapid progress in this area.
 
 EPM: What scientific and/or production process developments originating from NREL/DOE can the ethanol industry expect in the next five years? 

 
 Riley: Pretreatment of corn fiber and DDG to extract additional ethanol and to upgrade co-products has shown great promise and should enter the mainstream ethanol industry within the next few years. Our experience in process chemistry and chemical analysis of complex carbohydrate streams high may also prove useful as existing plants seek to increase their throughput, ethanol yield, and plant efficiency. Several companies are interested in using fermentative organisms that we have developed. We expect major cost reductions in cellulase enzymes and therefore cellulosic ethanol to come from our contracts with Genencor International and Novozymes Biotech.
 
 EPM: Last question: What's your evaluation of the commercial ethanol industry today? Is it hindering the advancement of commercially viable biomass conversion to ethanol, or advancing the sci-ence? Other thoughts?
 
 Riley: The commercial ethanol industry of today, based on starch feedstocks, is laying the groundwork for the ethanol industry of tomorrow, which will use lignocellulosic as well as starch feedstocks. Perhaps most importantly, the current ethanol industry is developing the market and infrastructure for the future expanded industry. Also, as discussed above, the players in the current industry can easily be important players in the future. The commercial ethanol industry is in the midst of a major transition today, due to recent construction of numerous large (40 million gallons per year or more), highly efficient dry mills. Advances in understanding the complex chemistry of corn milling operations and exploiting opportunities identified through this deeper understanding should lead to a technological shift where dry mills will begin to take on some of the characteristics of biorefineries by adding capability that allows them to produce high value products (germ, oils, nutraceuticals) in addition to ethanol and animal feed. We also expect existing mills to become the testing ground for cellulosic biomass conversion, initially using corn fiber and DDG as their feedstocks and later integrating dedicated feedstocks such as corn stover. This will serve as the bridge to a dramatically expanded ethanol future.

Target for cellulosic ethanol is to have technology sufficiently developed to support one or more commercial-scale plants by 2010.'

September 2002

Columns

The Way I See IT

Featured

Can the Ethanol Industry Help Prevent Forest Fires

ACE Ethanol brings Wisconsin's first 15 online

The search for a perfect ethanol corn

From construction to production, Richard Hanson has built an interesting ethanol career

NREL's biofuels manager outlines agency goals

September 2002.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Columns

The Way I See IT

Featured

Can the Ethanol Industry Help Prevent Forest Fires

ACE Ethanol brings Wisconsin's first 15 online

The search for a perfect ethanol corn

From construction to production, Richard Hanson has built an interesting ethanol career

NREL's biofuels manager outlines agency goals

September 2002