There should no longer be any question that Big Oil is out to destroy biofuels. Anyone who thinks otherwise is simply not looking at the facts. This is no longer a little uprising here and a small skirmish there. This, my friends, is all out war!
It&rsquo;s a war being waged in Congress with millions of dollars of oil money. It&rsquo;s a war being waged state by state, with Florida being the latest example. It&rsquo;s a war that has hung the yoke of world hunger and environmental degradation around the neck of biofuels.
This is a war that began almost from the first gallon of ethanol ADM produced in the late '70s. It manifested itself then in the &ldquo;No Ethanol in Our Gas&rdquo; signs, in the pushback from mechanics, blaming ethanol for everything from poor engine performance to a faulty battery. It has continued over the years, encompassing energy conversion, environmental challenges, food vs. fuel and to the rescinding of the excise tax credits for ethanol. These issues have led to the latest smart bomb dropped on the biofuels industry, &ldquo;the proposal to rescind the federal mandate for biofuels all together.&rdquo;&nbsp;
This is a war that is, by nature, terribly one-sided. The people who are responsible for delivering our product to the public are the very people who seem to be bent on destroying it. In addition, they are funded to a depth far beyond that of the biofuels industry. Let&rsquo;s be clear, without a mandate the oil industry would cease ethanol blending almost immediately. This fallacious idea that somehow the oil industry would continue blending ethanol because of price or moral responsibility, or logistics without a federal mandate contained in the RFS is a Trojan horse.&nbsp;
On the positive side, we have a number of seasoned generals on our side and a great army of people ready to do battle. But we are underfunded and small by comparison. Our focus is continually being diverted to a number of battles going in different fronts at the same time.
Make no mistake, we are in a fight for our lives. There has never been a time in the history of biofuels that has required more determination, more focus and more coordination than is required today. When sharks smell blood, they circle and move in on their prey. The ethanol industry, in the past couple of years, has shed quite a lot of blood and the scent of that to those who want to destroy this industry is a powerful motivator to move in for the kill.&nbsp;
We can&rsquo;t just leave this fight to the generals, it is the responsibility of every one of us to do our part. This is, without a doubt, a war that will determine the future of our industry. Be involved, not just in a passive way, but be involved in speaking with your Washington representatives and on state level, your state representatives. This is not the time for passiveness, this is war!
That&rsquo;s the way I see it.
Author: Mike Bryan Chairman, BBI International mbryan@bbiinternational.com
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This is War!

Last month, Bob Dinneen, president and CEO of the Renewable Fuels Association, aptly pointed out in his &ldquo;View from the Hill&rdquo; column that oil&mdash;not corn or ethanol&mdash;drives food prices. He reminded us that every step of the food chain is reliant on petroleum products. His column was accompanied by a chart that illustrated the near-perfect relationship between global food prices and global oil prices over the past 13 years. &nbsp;&nbsp;
I reflected on Bob&rsquo;s lucid point after reading this month&rsquo;s cover story, &ldquo;Pretreated Biomass for Food and Fuel.&rdquo; In this page-44 feature, EPM Senior Editor Sue Retka-Schill describes the epiphany-like conclusions that renowned Michigan State University biofuels researcher Bruce Dale, and his colleagues, recently arrived at. To put it simply, they think biofuels done right could save the world. My words, not theirs. &nbsp;
After a thorough examination of global population dynamics, food demand, land use and productivity and the impact of energy and biomass production, Dale and his fellow researchers determined that, by 2050, the world will simply run out of adequate land to grow all the food and feed it needs unless we create new ways to get more of both from existing acres. So why not fuel, too? &nbsp; &nbsp;
As Retka-Schill explains, Dale has a vision of what agriculture could look like 20 or 30 years from now. It&rsquo;s exciting. He sees a new agriculture that uses land resources super efficiently, and he foresees a number of ways in which biofuel production can enhance, rather than compete with, feed and food production. Talk about believing in abundance theory.&nbsp;
Dale prophesizes all manner of cool things: early harvests, double cropping, biomass processing depots, pretreatment and pelletization strategies, and the like. Flying cars? Maybe so, but you&rsquo;ve got to read the piece for yourself to understand his vision. It&rsquo;s an audacious plan from one of the smartest guys in the business. &nbsp; &nbsp;&nbsp;
So where does the relationship between food prices and oil prices fit into this? Dale, like Dinneen, knows &ldquo;the age of stable, cheap oil is over&rdquo; and the only way the world can count on a cheap and abundant supply of food is to guarantee that it also has a cheap and abundant supply of liquid fuels. You see, in Dale&rsquo;s future more of one thing doesn&rsquo;t necessarily mean less of something else. &ldquo;It isn&rsquo;t hard to imagine a configuration for agriculture that would provide more food, more fuel and more environmental benefits,&rdquo; he says. &ldquo;It&rsquo;s actually quite easy to image win-win-win scenarios once you start thinking that way.&rdquo;
&nbsp;
Tom Bryan, President &amp; Editor in Chief tbryan@bbiinternational.com

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Let's Start Imagining  Win-Win-Win Scenarios

The numbers don&rsquo;t lie. When directly compared with gasoline, ethanol reduces greenhouse gas (GHG) emissions by 40 to 50 percent. Ethanol also reduces all criteria pollutants: carbon monoxide, exhaust hydrocarbons that form ozone, particulates and toxics.&nbsp;
Recently, the House of Representatives Energy and Commerce Committee decided to take a deeper look at the impact of the renewable fuel standard (RFS) on GHG emissions and the environment.&nbsp;
I began answering the questions posed by the committee regarding the RFS and GHG emissions, and what became evident was that they were asking the wrong questions. The committee was delving into ethanol&rsquo;s impact on GHG emissions, without discussing the negative and harmful impact of its replacement. Their questions fail to compare today&rsquo;s environmental landscape to a world with no RFS, a world that would be entirely dominated by petroleum, increasingly supplied by Canadian oil sands and tight oils in this country from fracking.&nbsp;
Consequently, I decided to pose 10 questions of my own that should have been asked in order to gain a full understanding of the environmental impact of the RFS. They include:&nbsp;
1. What are the environmental effects of oil exploration, including seismic surveys, drilling and well logging, deployment of marine platforms, and infrastructure development?
2. What are the environmental effects of oil extraction, including fracturing, pumping, and additional infrastructure establishment?
3. What are the environmental effects of crude oil distribution, including transportation (ocean tanker, rail and/or truck) and pipeline?
4. What are the environmental effects of gasoline production at the refinery?
5. What are the environmental effects resulting from gasoline distribution, including transportation, pipeline shipment and storage?
6. What are the environmental and public health effects of gasoline use, including fuel blending, fuel dispensing and driving?
7. What are the GHG emissions impacts of increased unconventional oil production from Canadian oil sands, tight oil from fracking, thermally enhanced oil recovery, and gasoline production, distribution and use?
8. How has the composition of gasoline and resulting emissions changed since 2005?
9. What are the GHG and other environmental impacts of our dependence on imported oil and the national security implications of that dependence?
10. Do current lifecycle analysis tools and models fully capture the environmental and carbon effects of oil exploration, extraction, processing, transportation and combustion?
Context is important. As Congress assesses the merits of ethanol and the RFS, a clear understanding of the fossil fuels being displaced by ethanol and other renewable fuels is imperative. Changes to the RFS would undoubtedly lead to increased use of marginal petroleum, fuels that have their own distinct environmental, public health and carbon effects.
Moving forward, I hope the Committee realizes the necessity of the RFS and takes a fair and objective look at all aspects of GHG emissions, without omitting the negative effects of petroleum on the environment.&nbsp;
Author: Bob Dinneen President and CEO ,Renewable Fuels Association 202-289-3835

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Asking the  Right Questions

Global Big Oil companies consistently criticize E15 for use by American motorists. Among their litany of fictitious claims is that E15 is dangerous and will cause engine damage. Without any evidence to back their claims, it is clear that they are employing scare tactics to prevent consumers from choosing a less expensive alternative to foreign oil.
As a matter of fact, Big Oil has erected every possible barrier to prevent higher blends, such as E15, from entering the commercial marketplace, protecting their market share and record profits at the expense of the free market and consumer choice.
They have launched an aggressive and endless public relations campaign designed to deceive and distort the truth about the true benefits of renewables. They have also taken their challenges to the courts. Big Oil&rsquo;s deep pockets are funding a relentless campaign to lobby Congress to repeal the renewable fuel standard (RFS). Oil companies have made it clear they will do whatever it takes to maintain their stranglehold on the liquid fuels market.
Yet, something odd is occurring. While these companies are fighting biofuels here in America, claiming eminent damage, they are promoting them overseas. Like in Brazil, where they are using a 25 percent blend and in Thailand, where oil companies are using a 20 percent ethanol blend.&nbsp;
So, halfway around the world, they are speaking out of the other side of their mouth as they introduce higher blends of ethanol into the marketplace. &nbsp;Apparently it is safe to use E15 and even higher blends of ethanol. The Bangkok Post reported May 6 that, &ldquo;Shell officially began selling the fuel on Friday at 32 petrol stations in Greater Bangkok.&rdquo; In fact, higher blends are so successful the article goes on to explain that Shell, &ldquo;plans to expand to 100 pumps nationwide by year-end.&rdquo;
Shell is confident of the performance and safety of higher ethanol blends, explained Grant McGregor, general manager for retail sales and operations. &ldquo;We plan to have a communication strategy with our customers to ensure awareness and confidence in our products.&rdquo; He also noted that, &ldquo;We expect continued growth in the E20 market, as this segment's sales grew 30 percent in the first quarter.&rdquo;
Then why are oil companies fighting higher blends of ethanol like E15, at home? Clearly their research shows it is safe and consumers should feel confident. &nbsp;What is the difference between Bangkok and Boston, Thailand and Tuscaloosa? What is the difference when it comes to fueling our transportation needs? The answer is none!
If higher blends, such as E20, work in cars in Thailand, NASCAR runs E15 at Talladega and every single one of their other races, and if it is good enough for Shell to sell halfway across the world, then it is good enough for American consumers. They should have the choice to fuel up with higher ethanol blends in Anytown, USA, because it is safe and reliable, period.
The reality is that Big Oil will stop at nothing to protect their market share and keep their pockets deep and well-lined.
Author: Tom Buis CEO, Growth Energy 202-545-4000 tbuis@growthenergy.org

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Big Oil Talks Out of Both Sides of Mouth

The makeup of the ethanol industry has changed in the past five to seven years. As we look at some of the largest ethanol companies today, the 12 companies listed in the accompanying chart account for almost 53 percent of ethanol production capacity and comprise about 38 percent of total plants. Of the 12, more than half had little or no presence in the industry prior to 2007, but now account for a quarter of ethanol production. It is almost certain there will be more new faces and changes to the company mix in the next six years.
Independent ethanol companies still number more than 100, operating about 130 plants that account for about 47 percent of capacity. The table shows the dramatic changes in size, capacity and plant numbers; but it masks another important dynamic. It is the makeup of these industry players and the business they do outside the ethanol industry that will have important implications for independent ethanol companies going forward.
There is a growing influence from industries other than ethanol represented by the companies listed, as well as many independents not listed. Some of the outside industries represented among ethanol companies include energy/petroleum, grain/diversified agribusiness, advanced biofuels, cellulosic biofuels, sugar/sugarcane ethanol, food/alternative feedstock, bio-industrial, beverage and industrial alcohol.&nbsp;
Historically, ethanol processing margins were driven by supply and demand fundamentals in ethanol, energy and corn, plus feed and policy impacts. As more ethanol companies diversify, the economic incentives to expand or contract production are changing. For a growing number of companies, at least part of production decisions will be based on considerations outside the core ethanol-making business.&nbsp;
One example is the corn wet miller, whose decision to make ethanol is one part of a larger corn-processing optimization equation, including many factors outside the ethanol and petroleum industries. Another is among petroleum companies, where the decisions to make ethanol and invest in their captive ethanol plants are not only based on ethanol margins, but also on blending economics, the prices for renewable identification number (RIN) credits and their obligated volume requirements under the renewable fuel standard, as well as other factors.&nbsp;
Over time, the implication of these outside influences will be seen more noticeably in the &nbsp;EBITDA (earnings from the business before the capital structure items like depreciation, interest and taxes) competitiveness of ethanol producers and how those companies respond to difficult margin environments. Between 2008 and 2012, in a pool of plants that grew from 23 to 31, the average range of EBITDA from lowest to highest was 38 cents per ethanol gallon. During that period, the narrowest spread was 24 cents per gallon and the widest spread was 64 cents per gallon of ethanol. Most of the variance in margin spreads today among companies is driven by the difference in business decisions, price volatility and individual hedging activity.
New technologies like corn oil extraction, fractionation, better corn component separation and advanced/cellulosic biofuels technology will give some companies direct EBITDA advantages, while others will fail to monetize new technology and take losses. The earnings diversification and outside business influence will have indirect impacts on EBITDA margins and on the supply and demand fundamentals in ethanol.&nbsp;
Today, when ethanol supply outpaces demand, margins tighten and plants idle until supply and demand comes back into line and margins improve. This scenario played out from 2012 to the present with average EBITDA margins at 4 cents per gallon of ethanol. Similarly, when ethanol demand outpaces supply, margins expand, plants increase production and idle plants start to produce. Supply and demand comes back into line, and margins compress. This scenario played out through 2011 with average EBITDA margins at 25 cents per ethanol gallon.&nbsp;
The net effect of increasing outside business influence will likely drive more volatility in earnings, a wider margin spread between low- and high-EBITDA companies and could cause market downturns to be deeper and/or longer because the ethanol production decision will go beyond basic corn, ethanol and coproduct processing margins.
So what does this mean for independent ethanol companies? They will not only have to invest to continue to become more competitive, but they will have to get better at selecting and deploying new technology investments. Some will look to leverage scale economics through mergers or acquisitions to fund performance improvements and new technology, and some may need to look at diversifying or vertically integrating their business in order to be competitive in the longer term. All this points to the importance of returns to management&mdash;the board and managers whose leadership and vision is needed to move the business to the next level.&nbsp;
Oil Refining Proxy If we use the oil refining industry as a proxy, there were similar dynamics that drove some industry participants to great opportunity and displaced others. Again, looking at the refining numbers and history only tells part of the story. Today, 90 percent of U.S. oil refining capacity is owned by eight companies. The ethanol industry is not likely to scale up to the same degree as the petroleum industry because of grain logistics and the renewable fuels standard. We have seen some scaling, though, as we moved from building 25 MMgy to 55 MMgy to 110 MMgy plants, and we will likely see more in the future.&nbsp;
The richer part of the petroleum consolidation and restructuring story was the upgrading of low-value byproducts into higher-value coproducts. This evolution of the petrochemical industry brought us polymers, packaging, fibers, lubricants, construction materials, paint coatings, healthcare and pharmaceutical products. These products touch almost every part of our lives today, but the industry was born out of a simple business of providing heating oil more than 140 years ago.
For ethanol companies, the harsh market reality means that some will not make it to this next level. It is imperative that independent ethanol companies assess and understand their position regarding economic competitiveness and value in the marketplace and conduct strategic and tactical planning for attaining the best value for their shareholders. Independent ethanol companies will need to implement a disciplined new-ventures assessment process that goes beyond annual capital-expenditure budgeting. They will also need more robust capital planning to support performance improvements and new technology implementation.&nbsp;
Almost all operating ethanol companies today still have value commensurate with the investment the owners made, although some have more and some less value. This means most ethanol companies still have options. If independent ethanol companies choose to monetize their business through sale, they should time and plan their exit to maximize their valuation just as they would for any business venture. It is important that you sell when the market is right and before there is a technology innovation that requires capital investment just to maintain your current valuation in the marketplace.&nbsp;
At some point in the not too distant future, it will not be enough for independent ethanol companies to simply have good financial and plant management. The board and management will have to position the business to be viable and sustainable in a changing market environment. We are pleased to work with many independent ethanol companies that are leading the industry in making such changes to their businesses today.&nbsp;
At face value, this seems intimidating, but we are still fairly early in this transition so ethanol companies have some time. Unlike industry consolidations where the only option is scale or die, there are great opportunities and numerous options for ethanol companies that engage in taking their business to the next level of improved returns and performance. The biggest risk to independent ethanol companies is not in having the wrong plan, but rather, in not having a plan.
Author: Scott McDermott Partner, Ascendant Partners Inc. 303-221-4700&nbsp; Mcdermotts@ascendantpartners.com
&nbsp;
&nbsp;
The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Ethanol Producer Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).
&nbsp;

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Independent producers will require new strategies to stay viable.

Finding Business Success  in a Changing  Ethanol Industry

The ethanol industry&rsquo;s remarkable corn oil recovery trend is certainly getting its share of media attention this year&mdash;and why not? It&rsquo;s an interesting story. Corn oil revenue has been key in times of tough margins and, in some cases, has meant the difference between continuing operations and idling the plant, reported Holly Jessen, managing editor, in the May issue of this magazine.
This is no surprise to those of us working with ethanol plants across the country. We, at Novozymes, saw up close and personal how last year&rsquo;s corn quality and prices negatively impacted our customers. Reducing chemical and energy usage has become a sharp focus of producers. We&rsquo;ve seen how even small improvements in ethanol yield can have a huge impact on profitability. Any opportunity to increase revenue or reduce cost is being pursued. Novozyme&rsquo;s R&amp;D group has been successful extracting and converting more starch from corn, so we decided to investigate opportunities to increase corn oil yields as well.
Our research started with the insight that a significant amount of oil remains bound inside the corn kernel. These oleosome bodies are not broken up during front-end processes, and therefore the oil inside is unrecoverable using conventional methods. We needed to develop an enzyme that was strong and specific enough to penetrate the oleosin protein layer that stores these oil bodies in order to release them for extraction.
In a nutshell, or corn kernel, that&rsquo;s what we did. We launched Novozymes trademarked Olexa in June at the International Fuel Ethanol Workshop &amp; Expo in St. Louis. It&rsquo;s the first enzyme designed to break through the oil-binding protein layer within the corn kernel to release more oil for extraction. In our five industrial-scale trials, we saw an average increase of 13 percent in corn oil yields, exceeding our expectations.&nbsp;
But what really thrilled us was that in those same trials, plants saw on average 2 percent more ethanol. As Olexa is added in fermentation, we expected to see a noticeable ethanol yield increase, but 2 percent was impressive. We also saw an energy savings of 3 percent at the dryers. With Olexa added to fermentation, plants can set a new baseline for their oil yield, while preserving a full range of choices to improve their backend oil extraction processes.
Leveraging Cellulases for Saccharification At the same time we were developing our oil recovery solution, we were also developing an idea we had to leverage cellulase activity for the next installment of our Spirizyme saccharification series.&nbsp;
Here in the U.S., our main business is starch-based ethanol. But we are also making inroads into advanced biofuels with our cellulosic technology, which is becoming key in markets in South America and Europe, where biomass is more prevalent. We knew that our saccharification solutions could be more effective if we could remove more of the corn fiber matrix that was blocking some of the starch molecule from conversion. And then we discovered that advanced cellulase activity was the key.
At FEW, we also launched Spirizyme Achieve, which deploys advanced cellulase activity to degrade the corn-fiber network, releasing starch that&rsquo;s inaccessible to traditional glucoamylases. Then, specialized component activities in the glucoamylase are able to work synergistically to convert the starch into glucose. Across six industrial-scale plant trials, we saw ethanol yield increases between 1 and 2.5 percent and an average energy savings of 3 percent.
These two launches came just eight months after we released Avantec, our yield-enhancing liquefaction solution, which is seeing an average ethanol yield increase of 3 percent and energy savings of 2 percent. We believe the combined benefits of these technologies represent a new phase for the fuel ethanol industry. Imagine what plants can achieve if they can realize 5 percent more ethanol and 13 percent more corn oil, using 8 percent less energy. A 100 MMgy plant deploying all three of these technologies could generate more than $5 million in additional annual profits.
I think we all know it&rsquo;s been a challenging year in our industry. Whether it was commodity markets, corn prices, weather or politics, we often felt we were swimming against the tide. But hopefully, with advancements in enzyme technology that go deep into the tiniest, innermost molecules of the corn, no challenge is too big to overcome and the future economy of the industry looks bright.
Author: Jack Rogers&nbsp; Bioenergy Marketing Manager, Novozymes jckr@novozymes.com
&nbsp;
The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Ethanol Producer Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).

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Corn treated with conventional glucoamylase, left, shows enzymatic action on the surface. At right, corn treated with Sprizyme Achieve exposes more surface area to access more starch. 

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No part of the corn kernel goes unexplored.

Going Deep With Enzyme Technology   

The future of advanced biofuels is in beets. At least that&rsquo;s the thinking of those behind Mendota Bioenergy LLC, a California energy beet-to-ethanol project that last year received an approximately $5 million grant from the California Energy Commission to build a demonstration plant in the Mendota area of Fresno County to test out its theory.&nbsp;
The project is in motion with the money being used to help turn 250 acres of beets into 285,000 gallons of ethanol per year, through advanced enzyme and microbial techniques.
Jim Tischer, project manager with Mendota Bioenergy, says the beet crop delivers ethanol yields that are greater per acre and have a lower carbon index than Brazilian sugar cane or North American corn. &ldquo;This is an excellent re-establishment of an old crop to a new end, to make advanced biofuels,&rdquo; Tischer says. &ldquo;This is the first energy beet project to advance to the pilot and demonstration phase in the United States.&rdquo;
If the pilot program is successful&mdash;and everyone involved expects it will be&mdash;construction of the nation&rsquo;s first commercial-scale biorefinery in Mendota will begin with a 2016 target date. The goal of the commercial biorefinery is to produce 40 MMgy with about 15 percent of that production being cellulosic ethanol. That would put nearly 80 beet growers and 35,000 acres back into beet production.
Tischer says the biorefinery will also process waste pulp from the beets to produce biomethane for compressed natural gas, produce fertilizer and recycle water for irrigation. Based on projections, the biorefinery will create about 100 long-term jobs and 150 seasonal agricultural jobs and lead to millions of dollars of local economic activity.
Both the demo plant and the commercial plant would operate year-round and use beets grown by local farmers. Additionally, the plants would burn almond prunings and other wood waste to generate electricity for internal use and will convert some of those prunings into ethanol.
New Uses, Old Crop Currently, nearly 95 percent of U.S. ethanol is made from corn but the renewable fuel standard (RFS), established by Congress in 2005, caps the amount of ethanol produced from corn at 15 billion gallons. That set the wheels in motion for the idea to use sugar beets for this purpose. After all, beets produce about 1,200 gallons per acre of ethanol, compared to 450 to 500 gallons per acre of corn.
Mendota Bioenergy LLC was created in 2011, but the idea harkens back a few years to when the Spreckels Sugar Co. plant closed and a dozen former beet farmers united to form the Mendota Advanced Bioenergy Beet Cooperative to seek out a new market for beets. They teamed up with agronomist Steve Kaffka and engineering expert Ruihong Zhang, both of the University of California-Davis.
Kaffka has a storied history of working on sugar beet crops and is considered a specialist on crop performance in the region. It&rsquo;s his belief that the plan will be a success and he&rsquo;s looking forward to the results of the pilot program. &ldquo;My role in helping the growers is to advise them about the potential for the crops. I have been a member of advisory committees and know about a fair number of projects, but this has as good a chance as any of what I have seen of succeeding,&rdquo; he says, &ldquo;if beets can be produced profitably in the region and harvested or stored so they can be more than a short-season feedstock. What is really encouraging is that beet yields have been rising around the world fairly steadily over the last couple of decades and they continue to increase without increasing the inputs that are needed to produce them.&rdquo;
&ldquo;The introduction of energy beets will enable farmers to have another competitive crop in California and at the levels we think we can make the advanced ethanol, it should be a sustainable crop,&rdquo; Kaffka says. &ldquo;They grow year round, unlike other areas of the upper Midwest or Europe, they can grow in lower-quality soils (Class 2 or Class 3), they grow quite well with lesser quality water and they fit in well with rotations. What we&rsquo;re seeing in tests is that beets may even fit in well with the canary tomato rotation, which opens up a whole new vista.&rdquo;
New feedstocks and advanced fuels are essential if California is to meet the state&rsquo;s climate change policies and reduce greenhouse gas emissions, says Robert Weisenmiller, chair of the California Energy Commission.
&ldquo;The energy commission believes it is critically important to develop new feedstocks for the advanced biofuels industries and move away from reliance on a single feedstock crop like corn. The current drought and price spike for corn illustrates the risks of over-investment in a single crop feedstock for such an important component of our fuel supply in California,&rdquo; Weisenmiller says. &ldquo;We also need feedstocks with lower carbon content than corn. The average carbon content from Midwest ethanol just doesn&rsquo;t move the needle enough in California to reduce the carbon content of our transportation fuels as laid out in our Low Carbon Fuel Standard.&rdquo; For that reason, the CEC is investing in technologies and companies that can develop very low-carbon biofuels from waste-based and renewable resources, helping to create a more diversified portfolio of feedstocks and reducing the pressure on its farm systems.&ldquo;The energy commission will continue investing funds in companies and technologies that will produce low carbon, sustainable fuel products for the next generation of vehicles that California will need in order meet our carbon reduction and emissions reductions mandates,&rdquo; Weisenmiller says. &ldquo;On the biofuels front, we want to take advantage of regionally available feedstocks. We don&rsquo;t want to recreate the Midwest model of a monoculture feedstock feeding a single biofuels product. We want a variety, and we are confident that California companies will continue to work toward development of drop-in fuels that are compatible with modern engines and fully fungible with our existing fuel supply infrastructure.&rdquo;
Mendota&rsquo;s plan makes it a bellwether for the types of advanced technology, low impact, sustainable biofuels project that the CEC is helping to develop in the state. &nbsp;
&ldquo;First, on net, this is nearly a carbon neutral and water negative project. Plus, it&rsquo;s an integrated biorefinery, which means it has multiple processing loops to squeeze out the highest possible amount of sugar, starch and Btu from the beet and waste feedstocks,&rdquo; Weisenmiller says. &ldquo;It is a highly efficient project design. It will produce more clean water than it consumes by taking nonpotable process water from a neighboring operation and integrating it into the biorefinery.&rdquo;
Mendota estimates the final fuel products will have very low carbon scores: 39.3 MMgy of ethanol with a carbon score of 17.6 grams of CO2 equivalent per megajoule (gCO2e/MJ) and 773,000 diesel-gallon-equivalent of biogas. The plan is to also produce 151,000 gallons of biodiesel from locally grown canola and used cooking oil.&nbsp;
&ldquo;California sugar beets will use less water, fertilizer and pesticides than traditional corn cultivation for ethanol. There is tremendous cultivation expertise for this crop with the farmers and with the UC-Davis agronomy team,&rdquo; Weisenmiller says. &ldquo;Their goal is a 12-month cultivation cycle with yields of 40 tons per acre, which would translate to 1,000 gallons per acre.&rdquo;
Energy, Water, Carbon Tischer believes that one of the project&rsquo;s biggest competitive advantages in the California market is that the initial energy-beet-to-ethanol carbon intensity rating came in below 20 gCO2e/MJ. When you compare that to the 58.40 gCO2e/MJ rating that the best Brazilian sugarcane ethanol and a carbon intensity rating of 80.7 for California dry mills using natural gas and producing wet distillers grains, the numbers are quite eye catching. &ldquo;Until we produce it through the demonstration plant, which will start in February, we haven&rsquo;t figured out how to do it,&rdquo; he says. &ldquo;UC-Davis indicates the carbon index will be less than 20 and the significance of that is the carbon index of gasoline is 85. Our plant will be one of the lowest in the U.S.&rdquo;
Energy integration is a big part of the carbon score. As with any biorefinery, Mendota Bioenergy has a sizable energy component. Maximizing the use of the energy beets is obviously the primary concern, but the area surrounding the proposed plant also has a sizable almond crop. Plans include a biomass gasifier to convert almond prunings into steam and electricity, providing all the steam and 40 percent of the electrical power needs for the plant. &ldquo;The gasifier means we do not have to burn coal [or natural gas] to make our process heat like some, which will keep costs low and keep the carbon index down. We&rsquo;re also capturing the biomethane from an anaerobic digestion process and using that for transportation fuels.&rdquo; The planned biodiesel production will be used by farmers in field operations to reduce their carbon footprint.&nbsp;
Another green aspect of the biorefinery is that woody plant matter, as well as beet pulp, will be used to produce about 15 percent of the ethanol as cellulosic at the Mendota plant. Also, the water in the beets will be captured during processing and recycled so that little fresh water will be used in the plant.
In California, water is a big factor that needs to be thought through in project planning. Depending on when the water districts were settled, some have surface water rights for the water that comes out of the mountains, while others have to pump it. &ldquo;We had a short rain season last year, total precipitation was down, and it had an impact on crops,&rdquo; Tischer says. &ldquo;How that plays out in Mendota&rsquo;s case is that three-quarters of the area we pull from has surface irrigation rights and they get water when no one else does. The other quarter is constrained by that. What that says is when we do our sourcing plan for beets (which looks to be 35,000 acres at this stage), we have to be sensitive to the traditional growing districts but also what the status is of water event districts. You may have to taper back, but you&rsquo;ll still be in production.&rdquo;
 Next Steps Mendota picked up its official contract from CEC on April 3 and is currently in the process of mobilizing its 34 subcontractors to move forward, with construction expected to begin in July and scheduled to be completed by December.&nbsp;&ldquo;By mid-2014 we should have optimized the pilot plant and have a good idea if the turnout on ethanol from the energy beets is close to where we projected and if the economics will hold up,&rdquo; Tischer says. &ldquo;If that&rsquo;s the case, we can move beyond the pilot plant to the commercial full-scale development and the 40 MMgy plant. Depending on where the finance community is, we could have the plant in operation towards the end of 2017.&rdquo;
Author: Keith Loria California-based freelance writer 703-691-3607 freelancekeith@gmail.com
&nbsp;

Energy beets grown in the Mendota area of Fresno County will soon be used for ethanol production, thanks to California Energy Commission funding of nearly $5 million for a demonstration project.

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Bill Pucheu, beet farmer and president of the board of Mendota Bioenergy, surveys a field of energy beets in Mendota.

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Mendota Bioenergy's plan to turn energy beets to ethanol moves to demonstration scale in California's San Joaquin Valley. 

Lowering Ethanol's Carbon Footprint with Energy Beets

Most ethanol plants employ one or possibly two individuals charged with making sure the facility stays up-to-date with all permitting and reporting requirements. Considering the sheer amount of work involved and the fact that an environmental manager&rsquo;s job description typically also includes safety management duties, it&rsquo;s crucial that the department receives the full support and assistance of everyone, from top management on down to employees working in the plant itself.&nbsp;
&ldquo;Everybody at the plant, especially the executives, need to understand these complex requirements and the ramifications of not complying,&rdquo; says Jessica Karras-Bailey, principal with RTP Environmental Associates Inc., which helps ethanol plants obtain environmental permits and maintain compliance. &ldquo;In order to comply, it takes more than one or two people doing record keeping to make that happen.&rdquo;&nbsp;
M. Annie Mullin, partner in the law firm Schiff Hardin LLP, agrees. Schiff Hardin LLP is a general practice law firm that counts ethanol producers among its clients, helping facilities set up compliance programs, primarily regarding the Clean Air Act, and respond to information requests or notices of violation from the U.S. EPA. Mullin also stressed the importance of a top-down focus on environmental compliance. &nbsp;&ldquo;Starting at the board of director, plant manager level, the folks at the top need to create a culture of compliance,&rdquo; she says. &nbsp;
Obviously, staying in compliance is about avoiding fines, which can be hefty. Karras-Bailey also talks about the multiple benefits ethanol plants can reap from an environmental compliance program that&rsquo;s coordinated and team-based. For one thing, it increases system efficiency while reducing staff stress level, she said. Another benefit is that the facility is always prepared for agency inspections. A company with a solid environmental compliance plan can quickly and easily access requested records, even if the environmental manager happens to be on vacation. That can go a long way toward developing a positive relationship with environmental agencies, she said. In order to accomplish this, ethanol plants need to practice &ldquo;good housekeeping&rdquo; in its record keeping, she says.&nbsp;
Mullin talks about the same issue by saying it&rsquo;s actually fairly common for clients to tell her they know they completed certain required records, but they are unable to locate the piece of paper that is the only proof of that. She tells a story of one ethanol plant that couldn&rsquo;t find manually completed paper records of baghouse inspections because they were accidentally thrown out. In this case, the problem was discovered after an EPA inspection. &nbsp;The facility admitted its mistake and fixed the problem by switching to an automated system and, as a result, wasn&rsquo;t fined. &ldquo;It resulted in more consistent compliance and also a way to demonstrate compliance,&rdquo; Mullin says.&nbsp;&nbsp;
Another bonus is that, by maintaining excellent records, companies can identify and correct possible deficiencies before it&rsquo;s in hot water with the EPA or a state agency. &nbsp;&ldquo;Having a compliance system doesn&rsquo;t mean you will never have deviation, but when do you find out about that development?&rdquo; asks Karras-Bailey. &ldquo;Did you know within a day or two of it occurring?&rdquo;
This puts the company in a better position to take advantage of voluntary disclosure programs, she adds, telling of an ethanol plant that missed filing a required report. In the end, the company wasn&rsquo;t fined because it self-reported the problem, along with a description of the corrective action it planned to take to avoid future issues. &ldquo;From a negotiation standpoint, you are in a better position if you figure out you&rsquo;ve made a mistake, or there has been an oversight, and you contact the agency versus the agency coming in and doing an inspection and finding all the things you didn&rsquo;t do right,&rdquo; she says.&nbsp;
Another key point is the importance of honesty. Mullin says she sees it all too often&mdash;someone responsible for recording something for a required report, such as a scrubber water pressure reading, forgets to do it and then falsely fills it in later. That kind of thing often comes out eventually and results in a big problem for the company. In contrast, a company that simply admits that one or two records are missing on its quarterly report might only receive a small fine or no fine at all. &nbsp;&ldquo;If you send in a quarterly report that says we did everything perfectly, that sometimes is more suspicious than one that indicates occasional human failure,&rdquo; she says.&nbsp;
A good compliance program can also have financial benefits, although actual numbers are difficult to quantify. A facility with a positive relationship with environmental agencies as well as the community it is located in can achieve permit approvals faster and easier than one that has a history of violations, Karras-Bailey says. For example, say an ethanol plant wants to modify its permit to increase its ethanol production levels. A facility that has angered its local community may find the process slowed down during the required 30-day public notice period, when community members have the opportunity to comment. A three-month permitting process could be increased to six or nine months, during which the facility won&rsquo;t be able to hit the desired increased production level.&nbsp;
Top-down Priority&nbsp; So why can&rsquo;t a plant&rsquo;s board of directors or general manager simply hire a good environmental manager and leave the details to that person? There are multiple reasons, Mullin and Karras-Bailey say. One is that the environmental manager may compile the required paperwork but it&rsquo;s a member of the management team that signs it. With their signature they are certifying that they have determined everything in the report is correct and that they have conducted a reasonable inquiry into making sure that is true. &ldquo;In other words, the plant manager can&rsquo;t just look at the environmental guy and say, &lsquo;Is everything correct?&rsquo; and the environmental guy says, &lsquo;Yes,&rsquo;&rdquo; Mullin says. &ldquo;They need to actually dig down into the details and actually do an inquiry into whether everything is right.&rdquo; If it&rsquo;s later proven that the manager didn&rsquo;t actually do this, it can result in criminal penalties. &ldquo;Most things that a plant manager does can&rsquo;t land them in an orange suit, but this is one thing that can,&rdquo; she adds. &nbsp;
Karras-Bailey shared the way this is worded on documents from the Minnesota Pollution Control Agency. &ldquo;I certify under penalty of law that I have reviewed this facility&rsquo;s compliance status with respect to all permit conditions for the above specified calendar year,&rdquo; it says. &ldquo;I have determined, to the best of my knowledge, that this facility has been in continuous compliance with all permit conditions with the exception of those requirements listed in the above deviations report(s).&rdquo;&nbsp;
This is why both women recommend management takes the time for a thorough review of all elements of the facility&rsquo;s environmental compliance program. Karras-Bailey says managers need to know what to expect. A good place to start is to compile a master list of permits, with a daily, weekly, monthly and yearly schedule of what compliance activities are required. Keep in mind that some activities, such as review of a water permit, need only take place every four or five years, she adds.&nbsp;
Mullin recommends that the relevant people sit down together and go through the facility&rsquo;s permits. The goal should be to determine how the company will comply with the various requirements, including identifying what employee is responsible for what and who is that employee&rsquo;s supervisor. It&rsquo;s OK to have a lawyer or environmental consultant in the room, she says, but she doesn&rsquo;t recommend simply hiring someone to implement environmental compliance systems. In the end, management may not understand the system, which is crucial in helping them avoid possible future criminal penalties. She adds that most of the managers she has met are very nervous about signing their names to these documents. Going through this process helps them feel more confident.&nbsp;
Another reason management must understand and be involved in the compliance program is to demonstrate to all employees the appropriate priority level for these activities. The reality is that there are simply too many compliance duties for one person to keep up with on a day-to-day basis. Realistically, the environmental manager typically relies on plant-level employees to take readings and submit data, Karras-Bailey says. For example, daily baghouse compliance activities, which include recording the results of a visual inspection, may be completed by employees in grain receiving. As a result, the environmental manager is dependent on those employees to complete and turn in the data. Karras-Bailey has worked with environmental managers who ask her what to do when they aren&rsquo;t getting the information they need after repeated requests. Ultimately, it comes down to lead by example. &ldquo;[Management] needs to make sure environmental compliance is important, enough that the environmental manager is getting the support that they need,&rdquo; she says.&nbsp;
A good place to start is to have the environmental manager sit in on weekly operations meetings. One benefit is that she or he will be involved from day one if the plant is considering implementing new technology, which could require permit modifications, Karras-Bailey says. That will lead to a better-informed discussion and possibly shortened permitting time. Mullins recommends that environmental compliance become a standard part of all employee evaluations, from management level down to plant employees. &ldquo;That&rsquo;s one mechanism to make everyone in the plant aware of environmental compliance and accountable,&rdquo; she says.&nbsp;
Both women have heard employees complaining that they shouldn&rsquo;t have to do certain compliance activities or that the requirements just don&rsquo;t seem reasonable. What it boils down to, however, is that the requirements are part of the permit and without that permit the facility cannot continue to operate. That&rsquo;s why proper training is very important, including telling employees why they are required to do something, not just that they must do it. &ldquo;I find that message can be really effective with people, if they understand why they are doing it,&rdquo; Mullin says.&nbsp;
In fact, every single ethanol plant employee should pay attention to what&rsquo;s happening and speak up when there could be a problem, Karras-Bailey says. She told of visiting an ethanol plant and every single person smiled at her or gave her a friendly greeting but not one person inquired who she was, why she was there or directed her to the front office. Although she was there for a reason, ethanol plant employees should know that random visitors aren&rsquo;t allowed to just enter an industrial facility whenever they want. Another example she gave was of a solvent spill of less than a gallon that an employee reported to the EPA. It&rsquo;s always a good idea to report spills, of course, but if that employee had known what the chain of command was and reported it internally first, he or she would have found it that it wasn&rsquo;t necessary to report that small spill to the EPA. &ldquo;They need to have that bigger picture understanding,&rdquo; she says.&nbsp;
Author: Holly Jessen Managing Editor, Ethanol Producer Magazine 701-738-4946&nbsp; hjessen@bbiinternational.com

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â€˜[Management] needs to make sure environmental compliance is important, enough that the environmental manager is getting the support that they need.â€™ 

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â€˜The plant manager canâ€™t just look at the environmental guy and say, â€˜Is everything correct?â€™ and the environmental guy says, â€˜Yes.â€™

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Keeping an ethanol plant in compliance with environmental rules and regulations isn't just a one-person job.  

Culture of Compliance

Though a relative newcomer to the ethanol world, Georgia-based American Process Inc. is no stranger in the forest products industry. The company has demonstrated its consulting expertise in 500-some projects, logging more than 2 million work hours of project experience in nearly two decades. Founded in 1995 by Theodora Retsina as an engineering consulting firm, API has been increasing its presence in the cellulosic ethanol market with its bolt-on and stand-alone technologies utilizing woody biomass and crop residues to produce cellulosic sugars.&nbsp;
In 2006, API began investing its own funds into developing two technologies for cellulosic sugar production. Kim Nelson, vice president of governmental affairs at API, says the move was spearheaded by the need to keep the forest products industry thriving and viable. &ldquo;We were consultants to the pulp and paper industry,&rdquo; Nelson says, adding that it&rsquo;s fairly unusual for consulting firms to develop their own processes. &ldquo;Most of our employees at the time had advanced degrees in pulp and paper science engineering, biomass chemistry, wood chemistry, etc. If they did not have those advanced degrees, they had worked in the industry for many years. So we had this great understanding of the existing processes, and in handling, treating and extracting biomass. So it was kind of a unique resource that we had and took advantage of.&rdquo;&nbsp;
Bolt-on Conversion API&rsquo;s GreenPower Plus and AVAP (which was originally developed as American value-added pulping) technologies are utilized to extract sugars that may be used to produce biofuels and biobased chemicals from a variety of feedstocks. The GreenPower Plus technology first treats biomass, including hardwood, softwood or bagasse, through a hot water extraction process. The hemicelluloses are removed from the wood in this process and then treated with acid to form sugars. Last, the sugars are concentrated until it can be converted into biochemicals or fermented into cellulosic ethanol by organisms able to process C5 and C6 sugars. &nbsp;Any residual solid material containing lignin and cellulose is then processed to create pellets, combusted in a boiler or used for pulp and paper applications. Retsina, CEO of API, describes GreenPower Plus as a bolt-on technology for plants that are already aggregating biomass, such as a first-generation sugar-to-ethanol plant.
Basil Karampelas, president of API, says one of the main benefits of using GreenPower Plus is it upgrades a portion of the biomass to a higher value product at a capital cost of less than $10 per annual gallon of capacity. &ldquo;We are only taking the hemicellulose fraction of the biomass, which is typically 20 to 25 percent,&rdquo; Karampelas adds. &ldquo;Whatever we&rsquo;re not using goes back to the original user. You have the possibility to generate cash flow from that 25 percent that could be approximately equal to the cash flow from the burning of the other 75 percent of the biomass in the boiler or pelletizer.&rdquo;
Currently, API&rsquo;s GreenPower Plus technology is being demonstrated at the Alpena Biorefinery in Alpena, Mich. Co-located at the Decorative Panels International hardboard facility, the refinery began operating in the second quarter last year utilizing a DPI waste stream of woody biomass extract. It has a nameplate capacity of 894,000 gallons of cellulosic ethanol and 696,000 gallons of potassium acetate per year. The project was named a Center of Energy Excellence and a Renewable Energy Renaissance Zone by the state, and awarded $22 million in 2010.&nbsp;
Stand-alone Technology AVAP is API&rsquo;s stand-alone technology that converts biomass into sugars for cellulosic ethanol or biochemical production. It uses sulfur dioxide and ethanol pretreatment chemistry to extract hemicelluloses and lignin, Nelson explains. The lignin and hemicelluloses are processed by autohydrolysis. The hemicellulose is used to produce sugars while the lignin is transported to a boiler to generate energy for the facility. Meanwhile, the separated cellulose is either sold as a coproduct or is processed through enzymatic hydrolysis to produce cellulosic sugars, which can be converted along with the hemicellulose sugars into biochemicals or biofuels such as cellulosic ethanol.
On the AVAP technology, Retsina says it &ldquo;takes any biomass, it is completely feedstock agnostic, and converts all the biomass to fungible intermediate feedstock, which is sugars. Those cellulosic sugars can be converted to chemicals and fuel on site or shipped to another site and dropped into another operation.&rdquo;
API set up an affiliate in 2011, AVAP Co. LLC, to commercialize the AVAP technology it uses at its demonstration plant in Thomaston, Ga., which came online in May. &ldquo;With any first-of-its-kind facility,&rdquo; Karampelas says, &ldquo;we&rsquo;re anticipating there will be different things we&rsquo;ll be doing to tweak and optimize as we start up, which is what we did with Alpena.&rdquo; The plant can handle a variety of feedstocks at rates up to 10 tons per day, with an annual capacity of about 300,000 gallons per year. He mentions one way API is optimizing the site in Thomaston is by relocating API&rsquo;s corporate R&amp;D capabilities onsite.
&ldquo;AVAP is a technology that will fractionate the entire biomass and in doing so it gives us a lot of optionality around what we can ultimately produce,&rdquo; Karampelas says. He then clarifies that since the technology is fractionating the feedstock into cellulose, lignin and hemicelluloses, the plant can decide to skip the cellulose-to-glucose conversion stage and use the separated cellulose to produce coproducts, such as fluff pulp, while using the hemicellulose sugars for biochemical or biofuel production.&nbsp;
&ldquo;Our plan for both Thomaston and Alpena for the remainder of 2013 is to really perfect and optimize the two technologies at the demo facilities,&rdquo; Karampelas says. &nbsp;API was not prepared to share any specific yield estimates, since yield values are dependent on the feedstock and configuration, which can vary from site to site, he adds.
In addition to API&rsquo;s sugar extracting technologies, it has developed two energy management software tools for the pulp and paper industry. Energy Targetter is used to identify energy consumption problems, track performance of projects and improve energy efficiency. The Performance Indicator Benchmarking program is a Web-based tool that utilizes data from mills in the pulp and paper industry to help users benchmark their steam, water, electricity and thermal energy consumption.
API&rsquo;s newest software, apiMax, is a biorefinery simulator developed in 2009 for industries such as cellulosic biofuel and biochemical, pulp and paper and pellet production. API&rsquo;s website notes 30 companies and 13 institutions are using or evaluating the program that can simulate biorefining and energy equipment.&nbsp;
Brazilian Boost API recently got a boost when the Brazil-based biotech company, GranBio acquired a 25 percent equity stake in API, giving the company access to API&rsquo;s cellulosic sugar technologies. &ldquo;The association with a demonstrated cleantech leader such as GranBio strengthens American Process and makes it possible to aggressively grow our business,&rdquo; Retsina said in a press release about the agreement. &ldquo;We believe that the production of low-cost clean sugars is key to unlocking the potential of biomass as a versatile feedstock for fuels, chemicals and products. We are actively partnering with &lsquo;sugar converters&rsquo; to complete the supply chain and convert the sugars to high-value-added products. We are excited and very optimistic about the prospects of building the first commercial-scale plant with API technology in Brazil followed by one in the United States.&rdquo;&nbsp;
Karampelas views the deal as mutually beneficial for both API and GranBio. &ldquo;The way it benefits API is we&rsquo;ve got a partnership with a world-class company based in South America, specifically Brazil, where we see tremendous potential for both of our technologies,&rdquo; he says. He adds that by working with GranBio, API may gain insight in attracting international customers interested in using cellulosic sugars to produce their products. He says the relationship will help GranBio gain more exposure and a better understanding of API&rsquo;s home market of North America.&nbsp;
Author: Chris Hanson Staff Writer, Ethanol Producer Magazine 701-738-4970 chanson@bbiinternational.com
&nbsp;

APIâ€™s demonstration plant in Thomaston, Ga., uses its stand-alone AVAP technology. 

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Paper industry experts working with American Process Inc. apply pulp and paper expertise to extracting cellulosic sugars.  

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American Process applies forestry products know-how to cellulosic conversion.

Cellulosic Technology— Pulp and Paper Style

A 1-ton-per-day pilot facility on the campus of Michigan State University geared up this spring to produce pretreated biomass for feed trials. It&rsquo;s part of a demonstration that professor Bruce Dale hopes will show others how pretreating biomass for feeding animals can be successfully integrated with biofuels production, ultimately producing both more food and fuel.&nbsp;
While ethanol skeptics claim it&rsquo;s obvious that food needs trump the use of agricultural resources for fuel, Dale will tell you biofuels are not optional. &nbsp;As a scientist, he&rsquo;s ready to back that up with data-based reasoning. His motivation, though, comes from his childhood, growing up in the copper mining town of Ruth in eastern Nevada and seeing what happens when the mine runs out and a ghost town is left behind. He thinks of that when he considers our country&rsquo;s dependency on oil. &ldquo;Copper is potentially recoverable and recyclable,&rdquo; he says, &ldquo;but when you burn oil, it&rsquo;s gone.&rdquo;&nbsp;
Dale is far from a doomsday prophet, however. &ldquo;I&rsquo;m an optimist. I&rsquo;d much rather have an optimistic view of the future and try to figure out how to get there.
&rdquo;In a recent conversation with Ethanol Producer Magazine, Dale expounded on his vision for an agriculture that sustainably provides food, feed and fuel. As a professor of chemical engineering at MSU, Dale is known for a biomass pretreatment process dubbed AFEX, for ammonia fiber expansion. He is also known for his strong advocacy for biofuels, receiving the International Fuel Ethanol Workshop &amp; Expo&rsquo;s Award of Excellence in 2011.
Dale recently co-authored a peer-reviewed paper for the Council for Agricultural Science and Technology called &ldquo;Food, Fuel, and Plant Nutrient Use in the Future,&rdquo; along with an economist, a plant nutritionist and a soil scientist. The authors conclude the world will be capable of meeting its needs for food, fuel and fiber in 40 years, and biofuels can play a key role in fostering more efficient use of land resources.
Looking ahead to 2050, the paper finds that adequate world food production cannot depend upon expansion of harvested area. &ldquo;Instead, scientists and food producers need to look at the way land is currently used and the best practices for how to move forward,&rdquo; the CAST committee writes. The paper examines population dynamics, food demand, land use and productivity and the impact of energy and biomass production. The authors include Dale, David Zilberman, department of agricultural and resource economics, University of California-Berkeley, Paul Fixen, International Plant Nutrition Institute, Brookings, S.D., and John Havlin, department of soil science, North Carolina State University.
There is a clear relationship between a country&rsquo;s wealth and its access to cheap energy, the paper says, pointing out that the &ldquo;the age of stable, cheap oil is over.&rdquo; As fossil fuel supplies shrink relative to demand, price volatility is likely to increase. &ldquo;The world has had cheap food in no small part because it has had cheap energy, led by cheap oil. The production, processing and distribution of all agricultural and food commodities are intimately linked with the price of energy.&rdquo;&nbsp;
Energy Services The importance of biofuels is underestimated, Dale suggests, in large part because people haven&rsquo;t been trained to think carefully enough. &ldquo;They just talk about energy, but we don&rsquo;t pay for energy. What we want are the services energy gives us.&rdquo; If we paid for energy, he points out, the cost of a Btu would be equal, regardless of its source. Instead, we pay about five times as much for a Btu of oil as for coal. Of the three primary services provided by energy, two&mdash;heat and electricity&mdash;have multiple options to complement petroleum: natural gas, coal, nuclear, hydro, solar, wind or biomass. But for the third service, mobility, fully 96 percent comes from petroleum, with the remainder coming from biofuels and compressed natural gas (CNG).&nbsp;
CNG and electric will play a role in the future, he adds, but both have limitations. &ldquo;[Electric vehicles] don&rsquo;t have the power-to-weight ratio. It&rsquo;s a matter of physics. You can&rsquo;t pack enough energy in a battery to do certain types of things. You can&rsquo;t get a jet aircraft off the ground with a battery. You can&rsquo;t run a long-distance trucking fleet very well on batteries.&rdquo; In addition, CNG is likely to be more widely utilized only by truck fleets, partly because engine conversions and refueling stations are extremely costly.&nbsp;
When thinking carefully about energy, ethanol&rsquo;s value is much greater than when considering just its energy return on investment. Dale points out that most of the energy used in ethanol production doesn&rsquo;t come from petroleum, but rather natural gas. &ldquo;What you get for liquid-out for liquid-in is 20-to-1 for ethanol,&rdquo; he says.&nbsp;
&ldquo;That&rsquo;s why biofuels, liquid fuels from plant material, are so critical,&rdquo; he explains, largely due to the potential to significantly scale up production. &ldquo;It&rsquo;s going to be difficult for grains to do it at large scale, but it&rsquo;s not difficult to do with cellulosic at large scale&mdash;it&rsquo;s grasses and trees, woody material.&rdquo; Many of the cellulosic feedstocks being considered have multiple benefits, he adds. &ldquo;If we take reasonable care with how we grow them, how we develop them, then over time you get better water quality because perennial grasses improve water quality. You get more fertile soils because grasses improve soils. You get a lot of greenhouse gas (GHG) reduction because they are essentially carbon neutral and, if they are building up soil organic matter, they are probably carbon negative.&rdquo;
The concerns raised in opposition to biofuels, including food versus fuel and land conversion impacts, are also not being thought through carefully, he says. &ldquo;Agriculture today is nothing like it was 50 years ago, or 100 years ago,&rdquo; he says, and it will change again. It isn&rsquo;t hard to imagine a configuration for agriculture that would provide more food, more fuel and more environmental benefits. &nbsp;&ldquo;It&rsquo;s actually quite easy to image win-win-win scenarios once you start thinking that way.&rdquo;
Dale lays out a vision for the agriculture of the future that will use land resources more efficiently. He points out that currently 85 to 95 percent of U.S. agricultural land is used to feed animals, and not to feed humans directly. There are a number of ways in which biofuel production can utilize biomass resources without competing with feed use, and actually enhancing supplies. Biofuel production would allow the early harvest of feedstocks such as alfalfa and grasses when the protein content is high, utilizing the cellulosic fraction for biofuel production and concentrating the protein for animal feed. Additional feed protein can be coproduced with biofuels via the spent yeast. In addition, a ready market for biomass would stimulate double cropping, turning cover crops utilized for their environmental benefits into cash crops.&nbsp;
Biomass Processing Dale envisions the development of regional biomass processing depots that serve both the livestock feeding and biorefining industries. MSU is part of a research effort looking at ways of converting biomass into dense, stable, shippable intermediate commodities with uniform characteristics. Also researching the concept are Iowa State University, Idaho National Laboratory and Pennsylvania State University. &nbsp;&nbsp;
At MSU, a pilot facility began operating in late May, making feed pellets from AFEX-treated biomass. &ldquo;I&rsquo;ve always known it would increase the animal feed value,&rdquo; Dale says of the pretreatment process he and his colleagues have developed and refined over three decades. They are getting a boost from the Michigan Biotechnology Institute, formed at MSU to help move the commercialization process forward on university research. &ldquo;They&rsquo;ve made some notable advances in reducing the cost of the AFEX process and because of what they&rsquo;ve done, we&rsquo;re now in a position to commercialize animal feed first,&rdquo; Dale says. &ldquo;Then we can use the animal feed markets as a pull-through for the biofuels market.&rdquo;&nbsp;
&nbsp;
MBI obtained more than $5 million in funding from the U.S. DOE and the MSU Foundation to build a pilot-scale AFEX reactor at its facility in Lansing, Mich. The goal is to produce 10 to 15 tons of AFEX-treated biomass, which will be used in large animal feed trials being led by Stephen Rust with the MSU animal science department. &ldquo;After pretreatment, we pelletize the material and it essentially has the behavior of corn,&rdquo; Dale says. &ldquo;It&rsquo;s as dense as corn, it&rsquo;s stable like corn, it flows like corn.&rdquo; He adds that preliminary feed trials indicate it will have 80 percent of the value of corn in convertible sugars.&nbsp;
&ldquo;If all goes well&mdash;and we have smaller-scale ruminant feeding tests that show us it will&mdash;there&rsquo;s a lot of people who are interested in licensing it. We intend to license it very broadly and let as many people use it as want to,&rdquo; he says. Ultimately, building a base market as livestock feed will allow the supply of pretreated biomass pellets to build to a point where a biorefinery would be assured of sufficient feedstock, solving the chicken-and-the-egg problem of building out the cellulosic ethanol industry.&nbsp;
A Challenge Dale lays out a challenge to the ethanol industry&mdash;both the corn-based and nascent cellulosic industry. &ldquo;We need to start being proactive in the development of these fuels,&rdquo; he says. &ldquo;The thing is, in the U.S., the people who have the most easily converted and most abundant cellulosic material are the corn farmers with corn stover.&rdquo; It is essential that corn stover for biofuel be done right, he emphasizes. He also thinks there is an opportunity to promote double cropping as a way of tapping into the benefits of cover crops while growing biomass for biorefineries.&nbsp;
He urges biofuel producers and farmers to &ldquo;start embracing a positive vision of the future.&rdquo; The vision to communicate, he suggests, goes like this: &ldquo;We understand the environmental concerns, we want to improve the environment too. We're going to start harvesting our corn stover, and at same time we&rsquo;re going to plant cover crops and double crops. We&rsquo;re going to build up soil organic matter, reduce erosion and we&rsquo;re going to trap some of those nitrates so they don&rsquo;t get into water and head down to the Gulf of Mexico.&rdquo; &nbsp;&nbsp;
Globally, similar systems for animal feed coupled with biofuel production can play an important role. &ldquo;We underrate people&rsquo;s ability to produce from the land if they have the right incentives and the right tools,&rdquo; Dale says. Well-intentioned hunger programs of the past that distributed cheap surplus U.S. grains in developing countries had the unfortunate side effect of undermining local agricultural systems. &ldquo;Here&rsquo;s the bottom line. Those are places that are essentially without fossil fuels. They&rsquo;re too late. They&rsquo;re not going to get into the fossil-fuel bonanza. We will have burned it all up before Malawi or Mali or Kenya or other places in Africa and elsewhere ever get the chance,&rdquo; he adds. &ldquo;The only way they are going to develop and have the living standards we take for granted is to figure out how to produce sustainably&mdash;and that means in an environmentally sound way&mdash;lots of liquid fuels. That&rsquo;s only going to come from plant matter. As we get this industry going, we&rsquo;re going to see some very interesting side benefits for countries that don&rsquo;t have much in the way of liquid fuels. It will help jump-start a lot of economic development there, in the same way that having the cheap petroleum for so many years did here. It&rsquo;s not cheap anymore, so we&rsquo;re suffering from that now. But a lot of places that aren&rsquo;t blessed with the petroleum we&rsquo;ve had will be able to grow their own fuel. And, because they&rsquo;ll be incentivized to do it in a land-efficient way, there will be more food as well.&rdquo;&nbsp;
These systems won&rsquo;t be instantly perfect and mistakes will be made, he predicts. Also, one of the lessons of the past is that productive agriculture often produces price-depressing surpluses for which biofuel production provides an alternative market. &ldquo;We&rsquo;ve learned people can only eat so much, but there&rsquo;s apparently no limit to how much we would like to travel around if we could,&rdquo; he quips.&nbsp;
Author: Susanne Retka Schill Senior Editor, Ethanol Producer Magazine 701-738-4922 sretkaschill@bbiinternational.com
--------------------------------------------------------------------------------------------------------------
2.5 x more biomass possible
An analysis cited in the Council for Agricultural Science and Technology paper, &ldquo;Food, Fuel, and Plant Nutrient Use in the Future,&rdquo; shows that total biomass production potential, including both grain and cellulosic biomass, could be increased 2.5 times over current levels. &ldquo;This is enough biomass to produce approximately 400 gigaliters of ethanol per year, roughly the energy equivalent of all imported petroleum used for gasoline production, while still providing all the food and feed currently produced on this acreage. This approach to integrated food and biofuel production also decreases total U.S. GHG emissions by approximately 700 teragrams carbon dioxide equivalents per year, roughly 10 percent of the total U.S. GHG emissions.&rdquo;
&nbsp;
&nbsp;

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Bruce Dale has long been an advocate for biofuels, starting his research on the AFEX pretreatment process three decades ago.

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Bruce Dale urges careful thought about energy and agriculture.

Pretreated Biomass for Food and Fuel

The 29th Annual International Fuel Ethanol Workshop &amp; Expo brought together a diverse group of stakeholders, including ethanol producers representing 146 U.S. ethanol plants and nine Canadian plants as well as producers from four other countries.&nbsp;
Jeff Broin, founder and chairman of the board for Poet LLC, kicked off the event June 10, at the ribbon cutting ceremony. Broin talked about past and present struggles facing the ethanol industry, including attacks on the renewable fuel standard and breaking past the blend wall. &ldquo;Don&rsquo;t kid yourself, we&rsquo;re at war,&rdquo; he said. &ldquo;We&rsquo;re at war for billions of dollars of revenue that others do not want to give up.&rdquo;&nbsp;
The general session, held June 11, was packed for a mid-year policy update and updates from the cellulosic ethanol world. First, the top executives of the Renewable Fuels Association, Growth Energy and the American Coalition for Ethanol gathered to address fighting to preserve the RFS, E15 and higher blends and other important topics. That was followed by reports from DONG Energy Power, INEOS Bio, DuPont Industrial Biosciences, Abengoa Bioenergy and Poet, some of the global pioneers in reaching for commercial-scale cellulosic ethanol production.&nbsp;
The agenda also included concurrent breakout sessions covering production and operations, leadership and financial management, coproducts and product diversification, and cellulosic and advanced ethanol. In all, about 120 speakers and moderators participated.&nbsp;
Awards were also presented to a USDA researcher and an advocate for ethanol as a race fuel. Kevin Hicks, research leader for the Sustainable Biofuels and Coproducts Research Unit of the USDA&rsquo;s Eastern Regional Research Center, received the Award of Excellence, while ICM Inc. employee Dan Schwartzkopf was presented with the High Octane Award. &nbsp;&nbsp;
This year, for the first time, industry tours were held on two days. The Monsanto Chesterfield Campus and Bunge-SCF Grain Elevator hosted a bus full of FEW attendees on June 10. The second tour, on June 13, was of the National Corn-to-Ethanol Center, which is celebrating 10 years of operation. In addition, tour-goers also stopped at the Melvin Price Lock and Dam, near East Alton, Ill., on both days. &nbsp;
The 2014 FEW is set for June 9-12 in Indianapolis, Ind. It will be the 30th anniversary of the event.&nbsp;
Author: Holly Jessen Managing Editor, Ethanol Producer Magazine 701-738-4946&nbsp; hjessen@bbiinternational.com

John Caupert, director of the National Corn-to-Ethanol Research Center, shows off a cake decorated with a mock-up of an Ethanol Producer Magazine cover. NCERC kicked off its 10-year celebration during the FEW attendee tour held June 13. 

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A tour of the Bunge-SCF Grain Elevator was held on the first day of FEW. 

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The Clydesdale stable on the grounds of Anheuser-Busch in St. Louis is explored during the tour of the brewery, the evening of June 12. 

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Tim Portz, vice president of content and executive editor of Ethanol Producer Magazine, looks on as Jeff Broin, founder of Poet LLC, cuts the ribbon as part of the Expo Grand Opening held June 10. 

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Brooke Coleman, executive director of the Advanced Ethanol Council, left,
moderated a panel of cellulosic ethanol company leaders. Panelists included Henrik Maimann of DONG Energy Power, center, and Mark Niederschulte of INEOS Bio. 

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Steve Mirshak, global business director of cellulosic ethanol for DuPont
Industrial Biosciences, also spoke during the cellulosic  roundtable, as did Chris Standlee from Abengoa Bioenergy and Wade Robey from Poetâ€“DSM Advanced Biofuels.

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Bob Dinneen of the Renewable Fuels Association at right, speaks during the general session. Also on stage is (from left to right) Tom Bryan of BBI International, Tom Buis of Growth Energy, and Brian Jennings of the American Coalition for Ethanol.

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M. Annie Mullin of Schiff Hardin LLP presents during a breakout session on environmental and regulatory compliance. 

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Shane Chrapko of Himark bioGas Inc. speaks at FEW. Next to him is moderator Richard Weiner of Fredrikson & Byron P.A. Other speakers represented ICM Inc., Meridian Biotech, Recycled Energy Development and the National Corn-to-Ethanol Research Center.

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Dan Mahon of Vogelbusch USA Inc. listens intently during a breakout session presentation. 

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Greg Bergon of Highwater Ethanol LLC meets and greets at the expo.

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Hundreds of companies had booths in the expo hall. 

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Douglas Haefele of DuPont Pioneer gestures while speaking to Kathleen Clarkson of DuPont Industrial Biosciences. 

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Ashland Water Technologies representative Lee Hollimon discusses the companyâ€™s technologies with an FEW attendee.

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An overflow crowd enjoyed the appearance of three U.S. association leaders together on the same stage.  

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Mike Bryan, chairman of BBI International, left, presents the Award of Excellence to Kevin Hicks, research leader at the USDAâ€™s Eastern Regional Research Center. ICM Inc. employee Dan Schwartzkopf was presented with the High Octane Award. 

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Industry representatives from 26 countries met in St. Louis, June 10-13, for the world's largest and longest- running ethanol conference.

“Where Producers Meet”

In Daytona in 1998, a then 8-year old Austin Dillon witnessed history at victory lane. Dale Earnhardt, the famed driver of his grandfather Richard Childress&rsquo;s No. 3 car, had finally won the Daytona 500. Video footage of victory circle clearly shows Austin standing next to his younger brother Ty and Earnhardt. Fifteen years later Dillon races in NASCAR&rsquo;s biggest series and is the driver face of American Ethanol, the ethanol industry&rsquo;s standard bearer in this country&rsquo;s most watched spectator sport. Paired with NASCAR&rsquo;s commitment to and use of E15 as a racing fuel, Dillon and the American Ethanol car carry the industry&rsquo;s message of clean and domestically produced fuel to millions of race fans.&nbsp;
You were 5 years old when your father made his driving debut in the NASCAR Busch series. What are some of your earliest memories of growing up around motorsports?
Growing up in a racing family and going to the track and being at the track and seeing things that people dream of seeing my entire life, it&rsquo;s been pretty awesome, and I&rsquo;ve been fortunate to see the things I&rsquo;ve seen. Probably one the coolest memories I can think of is being at Daytona 500 when Dale Earnhardt won in 1998&mdash;being at the track and getting scooped up by my grandmother and taken to victory lane and doing the hat dance and not knowing the kind of history that I was being a part of and how much fun it was at the time.
When did you first drive in a competitive event? Where were you and what were you driving?
I was in a Bandelero, which is like a full -bodied race go-kart. We were at the quarter mile at Lowe&rsquo;s Motor Speedway inside the track. We raced right before the qualifying night, and me and my brother both ran the race and we were racing for dead last, wrecking each other. That was our first race I think. We both spun out three times.
You, like lots of drivers racing at the highest levels of competition in NASCAR, have raced in a number of different series and different vehicles. How difficult is it to get a feel for the differences in horsepower, driving surface and racing styles in each of the different formats?
The learning curve is always a little tough to get used to but the great thing is to be able to drive a bunch of different race cars. My family pushed us to run dirt. In dirt you have so much horsepower. From the time you get into a late model on, it&rsquo;s just a bunch of horsepower. &nbsp;So you get used to sliding around and using that horsepower. I think that is what helped me to adapt to different series and different cars. Speaking of different racing surfaces, you&rsquo;ve certainly done very well on dirt. It seems like a lot of drivers have an affinity for dirt track racing. Why do you think that is?&nbsp;
I think you can get away from all of the pressures at an asphalt track and just relax and have a good time. Also, you are with the core group of racers that you grew up with. It's good racing and you can slide and take positions that sometimes you wouldn&rsquo;t be able to take on an asphalt track. You follow the grip lines. You follow the lines on the track. You follow the dirt and how it changes. Everybody loves that because it's real racing, and we enjoy anytime you can go out there and slide around and have a good time and mess around with your buddies afterwards, stay up all night and go race again.&nbsp;
Talk about getting that first NASCAR victory in the truck series at the relatively new Iowa Speedway back in summer 2010.
It was great. To get your first victory behind you, it&rsquo;s just a whole weight comes off your shoulders. Not only that, but my grandmother and my grandfather were there to be with me and that was just something I&rsquo;ll never forget. That memory will always be etched in my mind. The first one, there&rsquo;s nothing like it. It was a blast.&nbsp; When you win at a track, does it feel like you have more confidence the next time you run at that track?&nbsp; Yeah, it does. Any time you go to a place you can run well at and that you know you can go out there and win, there is just more confidence. You get into the car and you&rsquo;re excited and you have a feel that you are looking for, to try and find again. You are always looking for that same feel that you won with and if you can get it, man, it&rsquo;s another good weekend. You&rsquo;re an outdoorsman.&nbsp;What do you do? We try and hunt a little bit of everything. We love being in the outdoors. I love fishing. I love hunting. I&rsquo;ll hunt anything. &nbsp; Talk about how you feel about NASCAR&rsquo;s commitment to be the greenest and most sustainable spectator sport out there. It&rsquo;s great. Everybody needs to look toward a greener country. That&rsquo;s the greatest thing about our sport is that NASCAR has taken lots of steps to make sure that we are going green. We&rsquo;re doing it with our fuel and we&rsquo;re doing it at the tracks. You saw the first track last year (Pocono) actually go to all solar power. It&rsquo;s great to see all the pushing that NASCAR is doing.
The ethanol industry feels strongly that its partnership with NASCAR will get its message out to a key audience. What makes NASCAR unique in its ability to connect its fans with products and ideas?
It&rsquo;s probably just the brand awareness and that people love seeing their drivers. They connect to something and that&rsquo;s what&rsquo;s on your car, what&rsquo;s on the side of your car. And for sponsors with a product, like American Ethanol that is used on the track, fans also get to see it get used and proven. That&rsquo;s the greatest thing, that ethanol is used on the track!&nbsp; Has anything surprised you about being the driver face of our industry&rsquo;s historic American Ethanol partnership with NASCAR? I think there are a lot of people that are passionate about ethanol and what we&rsquo;ve been able to do with it in NASCAR. You see a lot of fans that are really interested in it, people that want to learn about it. There are a lot of people out there that don&rsquo;t know what the benefits of ethanol are. Being able to show them a clean fuel that runs good on the track is pretty awesome.

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Austin Dillon shares his earliest memories of a life spent in motorsports, his love of dirt track racing and the role ethanol plays in NASCAR's sustainability push. 

Q&A: Driving American  Ethanol to the Front

May 31&mdash;In late May, the U.S. DOE issued an export license to the Freeport liquefied natural gas terminal. Once operational, the facility will have the capability to export 2 billion cubic feet (Bfc) per day of natural gas to foreign markets. This approval comes on the heels of DOE&rsquo;s approval of Cheniere&rsquo;s Sabine Pass project last year which initially will export 2 Bcf per day and could expand significantly beyond that level. These two projects alone will increase domestic natural gas demand by over 5 percent and more than 20 additional projects are in various stages of development. Even if fewer than half of these projects are approved and built, market demand will increase dramatically, possibly to a level that will test the ability to supply domestic and export natural gas markets at reasonable prices. There is a possibility that U.S. natural gas prices will rapidly move toward world natural gas prices. &nbsp;
The relatively high natural gas prices in Europe and Asia explain why developers are trying to move natural gas out of the U.S. and into higher value markets. Naturally, as supply moves out of the U.S. and into foreign markets U.S. prices will tend to move up. How much is a function of the amount of supply that is exported. Over the next few years, U.S. Energy Services will continue to monitor the development of LNG export facilities since it&rsquo;s believed they will have an impact on natural gas prices in the U.S.&nbsp;

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LNG exports: Moving closer to reality

May 31&mdash;Rain makes grain was the old adage but too much rain makes an uneasy volatile market. &nbsp;The month of May saw snow, a narrow planting window and flooding. &nbsp;The market has two adjustments to make between now and the June 30 planting intentions report. How much acreage has been lost, and have yields been negatively impacted? &nbsp;For old crop, the issue will be the cash markets as this market continues to exhibit an aggressive approach.
The USDA was indicating a new crop carry-out of 2 billion bushels with 89.5 million acres harvested and a yield of 158 bushels per acre. &nbsp;Demand was considered high at 12.92 billion bushels compared to the past two years of 11.135 billion bushels and 12.527 billion bushels. &nbsp;Ultimately, multiple changes in both the supply and demand table are expected in the coming months. It could be argued the corn use in the feed and ethanol sectors was too high in the initial report. &nbsp;Feed demand for next year was projected at 5.325 billion bushels compared to 4.40 billion bushels and 4.545 billion bushels the past two years.&nbsp;
Last year was the other side of the spectrum in the weather arena but at least the acres were planted. Expect to see volatile markets this summer as production estimates decrease and demand adjusting accordingly. &nbsp;There is no room for error and support for new crop corn should remain at the low $5 price level until there is a much clearer picture of production possibilities.&nbsp;

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Volatile market expected as production estimates decrease

May 31&mdash;Post Memorial Day markets have advanced, mostly because of the strength in the Chicago container market. &nbsp;Most of this demand has been from China, partly because of the strength in protein prices, and the delays in shipments from South America. Some boats are waiting more than 2 months to get loaded.
Domestically, we have seen good demand for DDGS in the Eastern U.S., as that market fights the demand pull from Chicago. In the Western and Southern Plains markets, competition from other commodities is tempering demand for distillers grains, but feeders' coverage for the July forward time frame is no better than the ethanol plants&rsquo;. Everyone looks at the discount in the corn futures markets going ahead and wants to pay less, but farmers still have a pretty good hold on it. &nbsp;
DDGS prices going ahead will be affected both by the price of corn and ethanol plants' ability to procure it for the remainder of the summer. The margin structure past the nearby time frame (greater than a month out) has made people question whether all plants will run, but that is the way it has been for quite a while. Deferred margins have not given much opportunity for plants to commit to running more than a month or two ahead. Ethanol prices have been escalating lately and margins look like they will start to improve again through the end of the summer, leading to a commitment to forward run time. There&rsquo;s hope that the increased demand from China will offset any increase in production. Overall, the growing season has had a pretty crazy start and it looks like this summer is going to be no different than the past couple of unusual ones!
&nbsp;

Corn supply will affect DDGS prices

One cannot help noticing the number of lawsuits swirling in the renewable energy industry. They are big, expensive, and equally as important, they consume time and resources with the voracity of a tornado. Is there a strategy to eliminate drawing the attention of a plaintiff looking for a vehicle to make its position known in the industry? Not to my knowledge. Instead, the best thing a renewable fuel producer can do is position itself to minimize the disruption of its business when a lawsuit occurs.
When a company is named as a defendant in a lawsuit, the first thing it will be asked to do is provide information. United States law allows both parties in a lawsuit to request documents and information for use in support of their respective positions. &nbsp;Responses are required within a certain time limit and may be in the form of documents. Example requests include documents such as &ldquo;the company&rsquo;s marketing materials since 2003&rdquo; or &ldquo;copies of all of the board meeting minutes and notes since 2004&rdquo; or &ldquo;any and all documents related to production.&rdquo; Sound like a headache? It is. &nbsp;
Being named in a lawsuit creates angst. &nbsp;Receiving document requests results in near panic for a company not prepared. At the very least, the requests start a mad scramble just to determine what documents exist. It requires days of sorting through offices and computer hard drives. Each document must be examined by your counsel to determine if it must be produced and whether there is any information present that can be withheld. Some duplicates can be culled; some cannot because handwritten notes appear thereon. &nbsp;Determining what documents previously existed but have since been destroyed is also required.&nbsp;
A company will also be asked to identify individuals who were employed or contracted during the timeframe in question and may have knowledge regarding certain facts. Soon thereafter, each such individual will be interviewed to determine his knowledge, what documents he possesses, and why documents expected to be in his possession are missing.&nbsp;
The entire process is tedious, time consuming, and expensive. Without clear document retention and destruction policies, the more inefficient a company will be in locating and producing these documents. And the more its lawyers will need to bill in order to comply with the discovery requests or to argue about why compliance is impossible.
What to do? Right now, before becoming part of a lawsuit:
1. Draft and store detailed descriptions of your current document retention and destruction policies.&nbsp;
2. Distribute document policies and routinely educate all employees so that they understand what to archive and how.&nbsp;
3. Determine which employees are the pack rats and offer them assistance.
4. Determine past document policies and create detailed descriptions of each including the time frame of effectiveness.
5. Limit the number of copies retained by designating a record keeper for each area such as purchasing, storage, production, maintenance, sales, lab, board, office.&nbsp;
6. Require all those not designated as recordkeepers to cull documents not on the &ldquo;retain&rdquo; list.
7. Meet with your IT professionals. Take an active role in creating and documenting archive policies for emails and e-documents.&nbsp;
8. Archive e-documents such that each may be searched using criteria, e.g., date created, date last accessed, author(s), to and from, document type and key words, so that exact copies may be de-duplicated. &nbsp;
9. Create an employee handbook. Include policies regarding confidentiality and document destruction. Keep track of past employees with key roles.&nbsp;
10. Perform exit interviews with every employee. Obtain a signed confirmation of each exit interview and employee&rsquo;s ongoing obligations of confidentiality.
These strategies will allow a company to manage angst and panic related to launch of a lawsuit. Even better, they provide avenues for reducing expenses. So what are you waiting for? Get ready, get set, go!
 Author: Camille Urban Attorney, BrownWinick Law Firm 515-242-2451 curban@brownwinick.com

Strategies to Reduce Litigation Angst

May 31&mdash;Despite the preholiday spike in gasoline prices throughout the country, the main focus of the ethanol-to-gasoline market has not been based on overall demand up to now. Instead, the contributing factors are falling ethanol inventory levels due to moderate downward pressure in ethanol production because of weak plant margins and high corn prices over the past year. Total ethanol supplies fell to the lowest levels since the U.S. Energy Information Administration started tracking ethanol inventory in June 2010, bringing inventory levels down to 672 million gallons. The annual uptick in demand for ethanol and gasoline during the summer driving season will continue to drive decreasing ethanol inventory levels.
The low levels have ultimately resulted in strong ethanol price increases. The ethanol price is currently just 3 cents per gallon below the price of RBOB gasoline prices. This is the lowest price spread seen between ethanol and RBOB gasoline since November 2011. Despite the current corn prices, the expected demand for ethanol could continue to push ethanol prices higher through the summer months. &nbsp;

Gasoline demand: Better late than never  

1. The American Coalition for Ethanol has joined the ASTM Technical Committee D02 on Petroleum Products and Lubricants. The organization is represented by Ron Lamberty, senior vice president of ACE. The committee meets twice a year, and currently has jurisdiction over 580 standards. Standards developed during committee meetings play an important role in all aspects relating to the standardization of petroleum products and lubricants.&nbsp;
2. The Renewable Fuels Association has added Dawn Schueller Moore to its staff as communications director. Prior to joining the RFA, Moore served as press secretary to Sen. Herb Kohl, D-Wis., for nearly three years. She has publicized issues and events related to agriculture, rural development, and antitrust legislation. Moore rounds out RFA&rsquo;s communications team, which is led by Christina Martin, executive vice president. She will serve as a point person for day-to-day press activities and will actively participate in social media.&nbsp;
3. The U.S. Grains Council, the National Corn Growers Association, Maizer, which represents Argentina producers and the corn supply chain, and Abramilho, the Brazilian Association of Corn Producers, have signed a memorandum of understanding to form an alliance of North and South American corn producers named Maizall&mdash;The International Maize Alliance. The alliance members will collaborate on a global basis to address issues concerning food, security, biotechnology, stewardship, trade and producer image. The primary focus of the alliance is to emphasize the need for better consumer understanding of production agriculture. Maizall will also conduct outreach to governments and stakeholders on the need for trade-enabling biotechnology policies and regulatory procedures.&nbsp;
4. The board of directors of Betaseed have appointed John Enright as president, effective July 1. Enright joined the company in late 1995 and has held a number of roles in accounting and administration, most recently as chief financial officer. He has been a member of the Beta-seed senior leadership team for more than six years, contributing to the development and implementation of the company&rsquo;s strategic plan. Enrick replaces outgoing President Kurt Wickstrom. Betaseed has also promoted Jason Evenson to the position of regional sales manager in the American Crystal Sugar Co. market. Evenson became a sales representative for the company in 2006. Headquartered in Shakopee, Minn., Betaseed is a leading marketer of sugar beet seed.&nbsp;
5. Friesland, Wis.-based United Wisconsin Grain Producers LLC has joined Growth Energy. UWGP began producing ethanol in 2005 and now has the capacity to produce 58 MMgy, along with 200,000 tons of distillers grains. The facility&rsquo;s ethanol yield rate is 2.86 gallons per bushel, and the company has recorded more than $100 million in total earnings since beginning operations. UWGP brings Growth Energy plant membership to 79, with an additional 78 associate members. &nbsp; 6. Atlas Commodities LLC has announced that Joshua Bailer has joined its management team as managing director. In his new position, Bailer is charged with leading the firm&rsquo;s new suite of brokered products under the name Next Generation Commodities. Based in Miami, &nbsp;NGC includes coverage of biofuels, credits and other alternative energy projects. Prior to joining Atlas Commodities, Bailer spent three years as head of U.S. biofuels at Sucden Americas Corp.. He has also worked with Morgan Stanley in its oil and refined products trading division.&nbsp;
7. The Biotechnology Industry Organization has welcomed several new members, including Lignol Energy Corp. and Lanza-Tech. Burnaby, British Columbia-based Lignol Energy is developing biorefining technologies for cellulosic biofuels, renewable chemicals and biobased products. LanzaTech, which is based in New Zealand and has U.S. headquarters in Chicago, has developed a fermentation process to produce fuels and chemicals, including ethanol, from waste gas. With the addition of these companies, BIO&rsquo;s Industrial and Environmental Section membership now includes more than 85 companies.&nbsp; 8. Brazil-based GranBio has announced it will open a U.S. operations office in the San Francisco Bay Area of California. The company has also named Vonnie Estes as managing director-U.S. In her new role, Estes will lead GranBio&rsquo;s efforts to access new technologies and establish key public and private collaborations for the company&rsquo;s continued global expansion in advanced biorefinery development. Estes has more than two decades of experience leading technology and commercial development programs for global chemical companies, including building new business through multibillion dollar partnerships and new value chains in technology-focused businesses. Prior to joining GranBio, Estes served as vice president of corporate development at Codesix Inc. She has also held positions at DuPont Danisco Cellulosic Ethanol and Syngenta.&nbsp;
9. Maple Energy plc, an integrated energy company that operates a sugarcane ethanol plant in Peru, has announced that Rex Canon, CEO and co-founder, is stepping down from the company and its subsidiaries effective July 31. Canon led the Maple organization for nearly 20 years. Following his departure, Canon will pursue other business interests in the Americas, but has agreed to remain as a consultant to Maple Energy through Dec. 31. Guillermo Ferreyros has been appointed to replace Canon. He most recently served as general manager of Maple&rsquo;s ethanol business. Ferreyros will immediately take the position of chief operating officer and CEO-designate, and will become CEO following Canon&rsquo;s July 31 departure.&nbsp;
10. The Iowa Renewable Fuels Association has announced that Sperry One Stop in Coon Rapids, Iowa, has become the state&rsquo;s sixth retailer to offer E15 as a registered fuel. Sperry One Stop is located on Highway 141 in Coon Rapids. The IRFA works with retailers offering E15 to ensure they comply with federal and state regulations.&nbsp;
&nbsp;
Share your industry briefs To be included in Business Briefs, send information (including photos and logos if available) to: Business Briefs, Ethanol Producer Magazine, 308 Second Ave. N., Suite 304, Grand Forks ND 58203. You may also fax information to 701-746-8385, or email it to evoegele@bbiinternational.com. Please include your name and telephone number in all correspondence.

Lambertyâ€™s 30 years of experience in the ethanol industry and as fuel retailer and station owner will provide him with a unique perspective. 

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Bailer has 15 years of experience and deep relationships within the commodities industry. 

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Enright says is he confident Betaseed has the leadership and staff to build on its strengths and meet the needs of customers.

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Evenson formerly held positions at Bayer Crop Science and American Crystal Sugar Co. 

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Moore says she is anxious to put her press and social media skills to work at the RFA.

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Business Briefs

Remember when ethanol opponents hired a Beltway public relations (PR) firm back in 2008 to tarnish ethanol with a misleading food vs. fuel campaign?
Documents written by that PR firm, obtained by Sen. Chuck Grassley and posted on his website at the time, outlined their strategy: &ldquo;First, we must obliterate whatever intellectual justification might still exist for corn ethanol among policy elites. ... Second, we must demonstrate to policy makers that there is a political price to allowing ethanol policy to drive up the cost of food.&rdquo;
The deceptive attacks continue today, but the primary focus of our opponents has shifted to renewable identification number (RIN) prices and the impossibility of the E10 blend wall. Instead of being preoccupied with whose idea the blend wall is (Big Oil&rsquo;s), ACE has been putting our own twist on our opponents&rsquo; 2008 strategy to show lawmakers that petroleum marketers are using RINs to overcome the blend wall.&nbsp;
It goes like this: &ldquo;First, we must obliterate whatever intellectual justification might still exist for the imaginary E10 blend wall among policy elites. &hellip; Second, we must demonstrate to policy makers that there is a political price to helping Big Oil wipe out their competition and allowing them to continue driving up the price of fuel."
ACE is capitalizing on the gnashing of teeth by oil companies over RIN prices to help petroleum marketers &ldquo;do the math.&rdquo; Indeed, it helps when Big Oil whines so loudly about RIN prices, because it has resulted in enterprising petroleum marketers paying much closer attention to the economic incentive for those who aren&rsquo;t obligated parties to blend ethanol and acquire RINs. It requires a bit more cost and paperwork on the part of marketers, but we&rsquo;re able to help show them that it&rsquo;s a wise business decision.
A recent example of how we&rsquo;ve put this strategy to use is through a congressional staff briefing Ron Lamberty, ACE senior vice president, helped organize with the Iowa Renewable Fuels Association in Washington, D.C. Ron worked with a South Dakota petroleum marketer who revealed to a standing-room-only crowd of congressional staffers that since he began offering E15 along with other choices, including straight gasoline, ethanol has comprised, on average, between 18 and 28 percent of his overall sales. Congressional staffers were surprised to learn that this petroleum marketer was able to do what the oil companies suggest cannot be done, and to make money doing it, not to mention passing savings to his customers. Instead of putting the emphasis on the fact that he&rsquo;s offering E15, Ron and the station owner emphasized that when motorists have a choice, including fill-up on gasoline without ethanol, the real-world experience at his station was an ever-increasing percentage of sales containing ethanol.
As Ron has remarked to me, &ldquo;We used to get calls all the time from petroleum marketers asking, &lsquo;how do I get my hands on that blenders&rsquo; credit (VEETC)?&rsquo; Now we&rsquo;re getting calls from the same marketers asking, &lsquo;how can I get my hands on RINs?&rdquo;
Petroleum marketers aren&rsquo;t the only ones taking action. Ethanol producer members of ACE, such as Absolute Energy LLC, recently began blending and directly selling ethanol blends such as E85 and E30. Rick Schwarck, Absolute president and CEO, has pointed out that by taking this step, they&rsquo;re much more price competitive than other fuel suppliers, saving motorists money and creating additional demand for ethanol.
The bottom line is, we don&rsquo;t have to play defense about RINs and the blend wall. Instead, ACE is turning tables on Big Oil, using RINs as yet more proof for how the renewable fuel standard is working, and can help drive the expansion of all kinds of ethanol offerings. &nbsp;The resulting benefits are real. The business case is made to petroleum marketers that blender pumps and higher ethanol blends can make them money and generate customer loyalty. From a policy standpoint, it enables us to show lawmakers we can overcome the blend wall and sell increasing volumes of ethanol to consumers.
Author: Brian Jennings Executive Vice President American Coalition for Ethanol 605-334-3381 bjennings@ethanol.org

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Overcoming the Blend Wall With Our Opponents' Medicine

Earlier this year, in January, version zero of a report on biofuels and food security was published.&nbsp;
The UN Committee on World Food Security requested this report. The work was carried out by a specially composed project team under the aegis of the High Level Panel of Experts on Food Security and Nutrition. The HLPE is based in the same building as the Food and Agriculture Organization.
The task given was to &ldquo;conduct a science-based comparative literature analysis&rdquo; assessing &ldquo;the opportunities and challenges that biofuels may represent for food security so that biofuels can be produced where it is socially, economically and environmentally feasible to do so.&rdquo;
The result was devastating. Not a single positive word on biofuels came out. It was almost 50 pages of accusations against biofuels.&nbsp;
Considering the composition of the project team, carefully avoiding the participation of an expert favorable of biofuels, a balanced report could not have been produced. It reminded me of the way the inquisition worked in the Middle Ages.&nbsp;
The version zero report triggered a lot of responses, some highly critical of the &ldquo;analysis&rdquo; presented. Even the FAO itself didn't like it.
A new version has now come to light and an extract was circulated to a small group of stakeholders (not me).
I was prepared for the worst. Remarkably it has become a much more balanced report. I don't know who drafted it, but I cannot believe it was the same group of experts.&nbsp;
Still, there are statements in the summary that do not reflect reality. In this column I cannot address all the concerns I have, but there are two that need to be highlighted.
In the summary is stated &ldquo;given the overwhelming use of feed and food crops, concern over competition between biofuels and food production has been particularly acute.&rdquo; The report mentioned in another paragraph, &ldquo;When crops are used for biofuels, the first direct impact is to reduce food and feed availability.&rdquo;
Neither of these statements is objective.
I don't know what the researchers had in mind when they wrote &ldquo;overwhelming,&rdquo; but I personally would not want to characterize a net use of less than 3 percent of all cereals globally for biofuels as overwhelming.&nbsp;
The second statement totally ignores the softening effect of animal feed production. It is remarkable, but the entire document does not mention coproducts at all. I have the feeling that the experts did not take the trouble to include in their analysis a 550-page FAO report from 2012 on biofuel coproducts that shows the importance of the distillers grains for the feed and food market. It is what I would call selective science.
The report becomes forced and implausible when the experts try to establish the isolated effect of biofuels on food prices &ldquo;everything else being equal.&rdquo;
This is what I would like to call nonsense science. It is simply not possible to design an equilibrium model that still has explanatory value if major factors in food price setting like energy price, climate, dietary habits, trade restrictions, labor, food waste and speculation are all kept constant. Certainly not if biofuel demand accounts for less than 3 percent of all cereals available: Illusion presented as scientific fact.
Reports like these need to be correct, impartial and balanced. Certainly peer-reviewed. If, however, simple facts like the impact of coproducts are left out of the assessment, the biofuel-food fallacy will continue to exist.&nbsp;
Regulators and the public at large deserve a more honest assessment.
Author: Robert Vierhout Secretary-general, ePURE Vierhout@epure.org

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Keep on Fighting  the Fuel-Food Fallacy 

Two of biomass&rsquo;s most valuable characteristics are its ubiquity and its adaptability to scale. These attributes have been explored, each in turn, in this and last month&rsquo;s installments of Biomass Magazine. In June, we explored biomass inputs as a less carbon-dense supplement or replacement for coal. The enormity of the energy needed by the massive, grid-connected facilities we profiled are generating billions of dollars of investment worldwide to produce and move biomass, quite literally by the shipload.
 This month, we turn our attention to the other end of the spectrum and look closely at biomass energy systems that, in some cases, require little more than a handful of biomass to generate vital heat and power. Interestingly, the societal, economic and local benefits for biomass energy systems at these small and micro scales rival&mdash;and arguably eclipse&mdash;the benefits of the enormous conversions covered in last month&rsquo;s issue.
 Consider this from this month&rsquo;s Q&amp;A with BioLite co-founder Jonathan Cedar and co-inventor of that company&rsquo;s HomeStove product: Each day, 3 billion people cook over open fires, breathing raw wood smoke loaded with particulate matter. The resulting respiratory ailments and diseases kill more people each year than HIV and malaria combined.
 Our other features this month outline different but equally compelling benefits. Fuel cost savings, forest restoration, increased local economic activity and dispatchable power for storm-ravaged communities are all deliverables afforded by biomass energy systems that are highly portable, easy to use and incredibly clean. In Anna Simet&rsquo;s &ldquo;Why We Did it&rdquo; department, Millinocket (Maine) Regional Hospital CEO Marie Vienneau notes that the forecast $2 million savings delivered to the hospital over the next 10 years can be redirected to expenditures that will result in greater patient benefits. Director of Plant Operations Dale McLaughlin takes the benefit conversation even further saying, &ldquo;We also like the fact that the money is being spent on wood pellets. It&rsquo;s still in the U.S. and even better yet, here in our area,&rdquo;
 This month&rsquo;s stories are reminders that while the Btus delivered by small-scale biomass energy systems may lack the eye-popping enormity of those at massive power facilities, the benefits they deliver for their users are no less profound.

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Small-Scale Biomass Delivers Big Benefits

Genomatica adds advisory board member Genomatica Inc. has announced the appointment of Frances H. Arnold to its scientific advisory board. Arnold is a leading authority on protein engineering, directed protein evolution, enzymology, and metabolic engineering. Genomatica will leverage her expertise as it pursues the development of new manufacturing processes for intermediate and basic chemicals produced from renewable feedstocks. Arnold is currently a professor of chemical engineering, bioengineering and biochemistry at the California Institute of Technology. She is the recipient of numerous accolades from industry and academia, including the Charles Stark Draper Prize in 2011 and the National Medal of Technology and Innovation in 2011 Amyris appoints board member Amyris Inc. has appointed R. Neil Williams as a member of its board of directors, and chair of its audit committee. Williams has served as senior vice president and chief financial officer of Intuit Inc. since January 2008. At Intuit, he is responsible for all financial aspects of the company, including corporate strategy and business development, investor relations, financial operations and real estate. Prior to joining Intuit, he was executive vice president and chief financial officer for Visa U.S.A. Inc., where he led all financial functions for the company and its subsidiaries, including financial planning, business planning and financial monitoring. He will bring extensive financial, corporate strategy and execution experience to Amyris&rsquo;s board. Canadian professor awarded Marcus Wallenberg Prize The Marcus Wallenberg Foundation has awarded Derek Gray , a professor at McGill University, Montreal, Canada,&nbsp;&nbsp; the 2013 Marcus Wallenberg Prize for his study of nanocrystalline cellulose. The prize aims to recognize, encourage and stimulate path-breaking scientific achievements. Gray&rsquo;s research has shown that cellulose crystals in water suspensions align spontaneously in a specific pattern, creating unique optical properties. He discovered that solid films of crystalline cellulose suspensions make it possible to produce films with unique optical properties in wavelengths representing visible light. Possible applications include polarizing mirrors, lasers and optical security systems. ABO elects board members The Algae Biomass Organization has announced the election of seven members to its board of directors for the 2013-2015 term. The new and re-elected board members will join eight others already serving terms of the board. Newly elected board members are Tim Burns, president, CEO and co-founder of BioProcess Algae LLC, Jose Olivares, biofuels program manager for Los Alamos National Laboratory, and Todd Taylor, an attorney with Fredrikson &amp; Byron P.A. Current board members re-elected to new two-year terms are David Hazlebeck of General Atomics, Margaret McCormick of Matrix Genetics, Paul Woods of Algenol Biofuels and Tim Zenk of Sapphire Energy. ReEnergy Holdings adds executive ReEnergy Holdings LLC has appointed Mark Fidler as its chief financial officer. Fidler will oversee all aspects of finance and accounting, banking, tax, audit, strategic planning, information technology, and corporate debt and equity financing activities. Before joining ReEnergy Holdings, Fidler served as chief financial officer for Ambient Corp.

Arnoldâ€™s experience will help Genomatica tackle scientific and technical challenges as it continues to push the capabilities of biotechnology. 

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Fidler is experienced in public equity and debt markets. 

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Grayâ€™s discovery has extended the boundaries of the uses of forest raw material, creating potential for a series of new products in the forest industry.

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Williams has 30 years of experience in the financial services industry. 

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The U.S. Energy Information Administration published a set of annual statistics in May that include state-level estimates of consumption, prices and expenditures for woody and waste biomass. The most recent release includes data for 2011.
 The electric power sector consumed a total of 436.7 trillion Btu of wood and waste biomass in 2011. California led consumption on a state level, with 69 trillion Btu. Florida&rsquo;s electric power producers consumed 50.3 trillion Btu, with electricity producers in Pennsylvania consuming 28.7 trillion Btu. On a combined basis, the U.S. electric power industry consumed 436.7 trillion Btu of wood and waste biomass in 2011.&nbsp;
 The average price of woody and waste biomass for the U.S. industrial sector was f$2.64 per million Btu. However, the EIA reported prices as high as $3.68 per million Btu in New Hampshire, and as low as 40 cents per million Btu in Kentucky.

Wood and waste  biomass consumption for 2011

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EIA publishes consumption,  price estimates for biomass 

Georgia Power, Southern Company&rsquo;s largest subsidiary, has signed a 20-year power purchase agreement with Rollcast Energy for the electrical output of its Piedmont Green Power Plant, a 53.4 MW facility located in Barnesville, Ga.
 Under the agreement, Rollcast will retain all the renewable energy credits earned through the state&rsquo;s renewable portfolio standard.
 The plant is the first greenfield biomass project developed by Rollcast. It will take in approximately 500,000 tons of locally-sourced woody biomass each year and generate enough electricity to power more than 35,000 homes.
 The plant, which began operations April 19, took two years to construct. Zachry Industrial Inc., a subsidiary of Zachry Holdings, served as the engineering, procurement and construction contractor for the project. Delta Power Services, a subsidiary of Babcock &amp; Wilcox, is providing operations and maintenance services to the plant.

Rollcast Energy signs PPA with Georgia Power 

Biomass opposition is back, continuing a misleading and counterproductive campaign, &ldquo;Our Forests Aren&rsquo;t Fuel.&rdquo;
 The latest battleground of the campaign is the wood pellet industry, specifically the shipping of wood pellets overseas for use by biomass plants in Europe. The campaign kicked off with a splashy Wall Street Journal article questioning the practice of shipping pellets overseas. While the biomass, managed forestry and pellet industries are somewhat distinct and serve different purposes here in the U.S., we are all siblings in the larger bioenergy family. Attacking all these industries at once allows our opposition to further confuse the complex issues surrounding biomass.
 The real shame is that a national conversation on bioenergy and how it fits into the nation&rsquo;s complicated energy equation is long overdue. No one is saying that biomass will or should eventually power the entire country. But, as I&rsquo;ve said countless times before, it&rsquo;s an important part of the energy portfolio that reduces the use of fossil fuels and our dependence on foreign energy sources. It also contributes to sound environmental practices by providing an outlet for wood residue materials that can worsen forest fires, clog landfills and emit the harmful methane gas during decomposition. On the economic side, biomass allows local communities to generate jobs and harness the local materials that are available to it. Just last month, Biomass Power Association member ReEnergy Holdings held the grand opening for a new facility in Fort Drum, N.Y.
 The new ReEnergy Black River facility earned wide praise for a number of reasons. The new facility creates more than 30 full-time jobs in the rural North Country region of New York State, supporting nearly 150 additional logging positions. ReEnergy&rsquo;s lease-to-own wood chipper program is enabling 14 local logging companies to expand their market offerings, while working toward even greater profits. One local logging operation estimates that it will be able to sell around 60,000 tons of tree bark and limbs each year&mdash;materials that are otherwise unusable and would rot in a landfill&mdash;to ReEnergy for its new biomass facility.
 On the day of its opening, New York Gov. Andrew Cuomo lauded ReEnergy Black River as &ldquo;the future of energy in New York State.&rdquo;
 ReEnergy also made news last month when it became the first company solely devoted to electricity production to be certified to the Sustainable Forestry Initiative 2010-2014 standard. In voluntarily seeking this third-party certification from SFI, ReEnergy has made a formal commitment to procure its forest materials from qualified logging professionals who utilize best management practices and operate with an ethic of land stewardship that integrates reforestation, and protects the long-term quality of soil, air, water resources, biological diversity and aesthetics.
 Biomass, managed forests and pellet companies don&rsquo;t need SFI certification to show their commitment to sustainability. But companies like ReEnergy, which put the time and effort into earning the certification, demonstrate that biomass is fully able to comply with stringent and widely recognized sustainability standards.
 In a sound rebuttal to the original Wall Street Journal article, Rolling Stones keyboardist Chuck Leavell, whose family owns and operates 2,500 acres of private forests in Georgia, wrote: &ldquo;Just as musicians are passionate about their craft, independent forest owners are passionate about the art of land management. Our mantra is to leave the land in better shape than when we found it. Not only do we care about this from aesthetic and recreational perspectives, but for many it is good business to care.&rdquo;
 This is exactly what we want the biomass opposition to understand: for the bioenergy industry, sustainability is not a window treatment &ndash; it&rsquo;s our business. So "rock on," Chuck, and everyone involved with biomass. Author: Bob Cleaves President and CEO, Biomass Power Association <a href="http://www.biomasspowerassociation.com">www.biomasspowerassociation.com </a> <a href="mailto:bob@biomasspowerassociation.com">bob@biomasspowerassociation.com</a>

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Fueling Misplaced Outrage

Propagated from R&amp;D labs, think-tanks and even art communities, portable biomass power units have the ability to generate energy for a diverse set of applications and users. By providing a sundry of industries and communities with power, portables are comparable to other distributed power options, such as solar and wind. From California to New York and up into Canada, companies are finding creative solutions to the technological challenges surrounding portables.
 Nestled in the Bay Area of Berkeley, Calif., All Power Labs is the offspring of the art world. Tom Price, evangelist of the company, says local artists experimenting with large-scale pieces of industrial sculpture that incorporated fire elements spurred the research into gasification technology. The first biomass unit was constructed in 2007 and was a last-minute feature at the CleanTech Open.&ldquo;That&rsquo;s how we found ourselves in the fire lane of the center crowd of the convention center,&rdquo; recalls Price. &ldquo;The gasifier running, made out of junk, with all these VPs and CEOs standing around with their jaws on the floor, because we had just made the thing they were trying to invent&mdash;basically for free.&rdquo;
 After open sourcing its technology in 2008, the lab developed its PowerPallet technology. Currently, the lab is offering two sizes, 10 and 20 kilowatts (kW), at the average cost of $1.50 per watt. Both units stand only 6 feet high and have a footprint the size of a standard shipping pallet. Price says keeping the project small scale forced them to creatively integrate the components, and enables users to easily transport the unit to be used for rural electrification, off-grid homes and similar applications.
 The units can operate on a variety of feedstocks, with a preference for hardwood, softwood, and nut or coconut shells. Systems to handle additional feedstocks, including poultry litter and straw, are in development. At 75 percent load, the 20 kW unit&rsquo;s General Motors Vortec engine will consume roughly 952 pounds of biomass to generate a power output of 360 kW-hours.
 With installations in 45 universities in the U.S. and elsewhere, and in 30-plus countries, demand for the power technology has been increasing. Price recently visited with a representative from Africa interested in testing more than 240 units in trial villages. Many developing countries have incomplete electrical systems and several war-torn places have damaged systems, says Jess Hobbs, All Power founder. &ldquo;There&rsquo;s a general trend towards approaching energy from a microstructure. That&rsquo;s another important reason we developed our trial-scale systems.&rdquo;
 Waste Heat and Power
 In Great Neck, N.Y., AgriPower Inc. also manufactures portable biomass power systems. Barry Berman, AgriPower CEO, says the project began in 2002 with the development of a heat-only unit that was deployed in schools, hospitals and prisons for hot water production. A combined heat-and-power module&mdash;the waste heat generator (WHG)&mdash;is the product of research and development within the past two years. The biggest challenge of the design was solving a combustion chamber issue, according to Berman, as the initial gas-powered turbine used did not mesh well with the WHG combustion chamber&rsquo;s performance. The turbine was designed for immediate operation, whereas the chamber needed time to heat up to operating temperatures. Altering the turbine design solved the problem, says Berman.
 Unlike All Power Lab&rsquo;s pallet-sized unit, AgriPower&rsquo;s system is twice as tall and stretches about 40 feet once assembled. Because of the size, the heat and power units are transported separately via truck, then assembled and in operation within three to five days. The units are designed to provide baseload power to whatever application is used, lessening the amount of power needed from the grid.
 Once in operation, a 375 kW system will consume roughly 15 tons of fuel, depending on composition, density and moisture content, for 24 hours of continuous use. The system can be fueled by wood residue, crop and animal wastes and operates between 1,000 and 2,200 degrees Fahrenheit.&nbsp; During emission tests of the Agri-Power combustor, the unit consumed more than a ton of shredded wood chips with 40 percent moisture content, while emitting only 1.47 pounds per hour (lb/hr) of particulates with less than 0.20 lb/hr of carbon monoxide.&nbsp;
 Demand for the units is growing, and Berman says the company is getting ready to ramp up production. He has been contacted by both domestic and international organizations and businesses interested in using them. One interested company in remote, northern Canada could potentially save $1.6 million each year in carting and disposal fees, he says, by using discarded wood and food waste in the portable unit. In addition to powering remote locations and villages in developing countries, Berman says some government agencies, such as the Federal Emergency Management Agency and Homeland Security, have shown interest in the units. Debris from natural disasters could be used as fuel to power emergency electrical generation and water purification.
 Containerized Solution
 Canadian-based EverGreen Energy Corp. has a 50 kW portable biomass power unit capable of using a medley of feedstocks. &ldquo;We are fortunate that we have a list of waste streams that we can take, from woodchips, to slash, biodegradable municipal solid waste, some manure and woodchip mixes, corn, miscanthus, and other energy crops,&rdquo; says President Garry Spence.
 When evaluating a project, the company assesses available waste streams. Spence says the unit can utilize fuels with 10 to 40 percent moisture content, with 20 percent being the sweet spot. EverGreen units are shipped from the manufacturer in 40-foot containers and picked up from the plant by truck to be transferred to rail or trucked to their final destinations. Spence adds that for remote locations, units can travel via multiple shipping modes. &ldquo;So much of the energy that has been used by different remote areas is diesel-electric,&rdquo; Spence says. &ldquo;Nothing against diesel-electric, but we can replace that with biomass. But you have to have biomass available and you have to have the technology that can be positioned. So that&rsquo;s why we like the containerized sizes, so they can be easily delivered.&rdquo;
 Future Applications
 Henry Quesada-Pineda, assistant professor of sustainable biomaterials at Virginia Tech, believes there are both environmental and cultural implications for portable biomass technologies. He says utilizing renewable resources, such as biomass and agricultural wastes, will help alleviate waste management concerns for remote locations and could offset methane produced from decaying crop residues in developing countries. He adds that the unit the college is currently testing works well with hardwood and softwood fuels, but newer units will need to utilize a broader variety of feedstocks. Some, such as chicken litter, will require developing additional processes to turn the waste into a viable fuel.
 In addition to environmental benefits, Quesada-Pineda foresees cultural benefits from using portable biomass units. One of his proposals to the college involves transporting a few portable biomass power units to Central American countries such as Costa Rica and Guatemala. &ldquo;We tried to tell them we can help you to understand that waste can actually be a value-added product and for them it&rsquo;s kind of surprising,&rdquo; Quesada-Pineda explains. &ldquo;I think it&rsquo;s mostly because in most cases they lack the access to the knowledge.&rdquo;
 Increasing public awareness and overcoming inaccurate perceptions is perhaps the biggest obstacle restraining future market growth. To overcome this challenge, Berman seeks out speaking engagements and attends trade shows to demonstrate AgriPower&rsquo;s abilities. Spence says developing more cost-effective technology will generate more interest among potential users. Price sums up his vision for future applications of portable units this way: &ldquo;I don&rsquo;t think it&rsquo;s up to us to decide. What we&rsquo;re trying to do is create the opportunity for people to empower themselves.&rdquo; Author: Chris Hanson Staff Writer, Biomass Magazine <a href="http://mce_host/posts/mailt:chanson@bbinternational.com">chanson@bbinternational.com</a> 701-738-4970

FIRST FIRE UP: NREL demonstrates proof of concept for its small modular biopower unit.

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SENSIBLY SIZED: AgriPower's portable unit generally fits upon two semi trailers


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PACKING A PUNCH: All Power Labsâ€™ 20kW portable biomass unit can be fueled by multiple fuels including wood residue and animal waste.

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Small-scale power solutions tap into waste streams and local biomass.

Rise of the Portables

Enviva LP celebrated the official opening of its Northampton County, N.C., pellet plant May 21. The 500,000-metric-ton plant is the twin of a second facility under construction in Southampton County, Va. North Carolina Gov. Patrick McCrory was on hand with several other local and state officials to celebrate the plant&rsquo;s opening. &ldquo;Enviva&rsquo;s decision to locate this facility in Northampton County is a big win for the region, the forest products industry and the state of North Carolina,&rdquo; he said. &ldquo;They are creating good jobs in a growing industry and represent exactly the kind of business North Carolina needs to continue to attract to our state.&rdquo;
 Plans for the project were originally announced in August 2011. Wood pellets produced at the facility are being exported to Europe via Enviva&rsquo;s Port of Chesapeake export terminal near Norfolk, Va. The company acquired the deep-water port from Giant Cement company in 2011.

Opening Celebration: North Carolina Gov. Patrick McCrory speaks at the grand opening of Envivaâ€™s new plant. 

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Pellet plant opens in NC, boon for forest industry

Vancouver, British Columbia-based Viridis Energy Inc. has announced the closing of the second, and final, installment of its $5 million non-brokered private placement. The second portion consisted of 20 million units priced at 10 cents per unit.
 According to Viridis, the proceeds of the private placement will be primarily used for capital expenditures and operating expenses associated with its Scotia Atlantic Biomass Co. Ltd. pellet plant, which the company acquired last year. The Middle Musquodoboit, Nova Scootia-based facility is expected to become operational this summer, bringing Viridis&rsquo;s total annual pellet production capacity to 180,000 metric tons. The company also owns the Okanagan Pellet Company pellet plant, located in Kelowna, British Columbia.
 &ldquo;As targets for green, renewable energy consumption set by major industrial countries become effective, we expect demand for wood pellets to far surpass supply,&rdquo; said Christopher Robertson, chairman and CEO of Viridis. &ldquo;To prepare for the projected growth in demand, we are also studying production expansion alternatives at the company&rsquo;s Kelowna, B.C., plant.&rdquo;

Canadian pellet plant  to restart midyear

The USDA has announced $14 million in payments to 162 advanced biofuel producers in 38 states under the Bioenergy Program for Advanced Biofuels. The program awards payments to eligible producers based on the amount of advanced biofuel produced from renewable sources of biomass, other than corn starch. Payments are not just awarded for liquid fuels, producers of other advanced biofuels, including wood pellets and biogas, are also eligible for the program.
 Two dozen pellet producers received awards of $500 or more during the latest award announcement. Since the program&rsquo;s inception, more than 280 producers of all types of advanced biofuels have received a total of $192.5 million in payments.
 &ldquo;These payments represent the Obama administration&rsquo;s commitment to support an &lsquo;all of the above&rsquo; energy strategy,&rdquo; said Acting Under Secretary for Rural Development Doug O&rsquo;Brien. &ldquo;Producing advanced biofuels is a major component of the drive to take control of America&rsquo;s energy future by developing domestic, renewable energy sources.&rdquo;

Companies receiving $2,500 or more in payments:

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Pellet producers receive payments under Bioenergy Program for Advanced Biofuels

The South Carolina Forestry Commission has released guidelines for the harvest of woody biomass used to generate energy. Its recommendations aim to protect water quality, plant and animal diversity, soil nutrition and quality, and productivity near harvesting operations.
 The guidelines build upon existing best management practices (BMP) used by North Carolina timber harvesters via supplemental recommendations. They are not an alternative to BMP guidelines, which apply to all forestry operations.
 Guidelines related to harvesting include avoiding the removal of stumps, roots and leaf litter for biomass. Those harvesting biomass are also directed to ensure piles of chips or other fine materials are not placed in areas where they might enter wetlands or water bodies. In addition, the recommendations call for limiting biomass removal on slopes, where it could lead to erosion.
 The guidelines also note that, where appropriate, biomass harvesting can be employed as a means of vegetation control to enhance habitat for rare, threatened and endangered species.

SCFC publishes harvesting guidelines for bioenergy feedstock 

The U.S. Endowment for Forestry &amp; Communities Inc. released a report that assesses how community-scale, wood-fueled facilities could address forest health issues as well as losses from wildfires. The report, titled &ldquo;Financing Wood Biomass Clusters: Barriers, Opportunities, and Potential Models for the Western U.S.,&rdquo; is part of a series produced by the Endowment in collaboration with the U.S. Forestry Service.
 The report identifies factors that have contributed to the success for failure of biomass energy projects, with the goal of understanding how bioenergy can be more widely adapted in the U.S. The analysis uses survey data collected from 73 bioenergy plants and eight producers and distributors of biomass fuel. Of the 73 facilities, five are combined-heat-and-power plants, three produced electricity only and the rest produced only thermal energy.
 Barriers to the development of bioenergy facilities identified by the analysis include high upfront capital costs, lack of profitability among fuel producers and the seasonality of heat demand. Additional barriers include feedstock transportation costs, unreliable biomass fuel sources, insufficient policy incentives and risk aversion.
 The report describes several specific recommendations for action, including more effective financing methods, and the use of project development best practices. The analysis also recommends the development of lower-cost, standardized biomass energy systems along with project investments in regions where there is a dependence on propane, electricity and heating oil. Additional recommendations relate to fuel supply, fuel delivery, creating nontraditional revenue sources, policy, and understanding the importance of regional differences.

Study recommends ways to overcome bioenergy development barriers 

Dale McLaughlin has served as director of plant operations at Millinocket Regional Hospital for 15 years. During that time, he has continually researched and pursued different heating options that might be a good fit for the facility, with the ultimate goal of replacing its use of expensive No. 2 heating oil that so many homes and businesses in the Northeast U.S. are reliant upon.
 Besides nixing heating oil, McLaughlin&rsquo;s endeavors were driven by a couple of additional motivators&mdash;the desire to keep dollars spent on fuel at home, and to switch to something more environmentally sound. MRH CEO Marie Vienneau paints a picture of McLaughlin as someone who is not only an extremely competent and seasoned plant operations director, but is also really looking out for the best interests of the hospital. &ldquo;Dale has been very proactive in exploring other types of energy,&rdquo; she says. &ldquo;We&rsquo;ve wanted to reduce our oil use for cost reasons, but for those other reasons as well, and he&rsquo;s been at it for many years.&rdquo;
 Like McLaughlin, Vienneau has a long history at MRH, as she initially began working there in 1990 as a registered nurse. She assumed the position of CEO a few years later, which she has held for over a decade. When discussing their recent accomplishment of bringing on line a wood pellet-fired heating system, both McLaughlin and Vienneau exude pride, not only because it&rsquo;s the first to come on line in a U.S. hospital, but because of all that will be achieved as a result.
 Exploring Options 
 When the American Recovery &amp; Reinvestment Act made Wood-2-Energy grants available through the USDA Forest Service, it seemed like the perfect opportunity for MRH. &ldquo;We live in the middle of America&rsquo;s wood basket, so when this money became available, we decided to pursue it,&rdquo; says Vienneau, adding that it covered half of the cost of the half million dollar project.
 The ARRA grants totaled $11 million, used to convert 37 buildings from oil to wood heat. In all, the projects will annually displace more than 900,000 gallons of fuel oil, according to Peter Beringer of the Maine Forest Service.&nbsp; The project at MRH is predicted to displace nearly 80,000 gallons of fuel annually, saving the 70,000-square-foot facility $149,000 each year. How well the system actually performs will be tracked and compared to the projections, Beringer explains. &ldquo;One of the requirements of this project is a five-year fuel consumption reporting requirement. At the end of five years, we will be able to determine how accurate the estimates were and be able to have solid fuel data to help other potential conversion projects to make informed decisions.&rdquo;
 Once the grants were awarded and the Swiss Schmid Energy Solutions-supplied boiler arrived in the U.S., Washington-based Northline Energy began the installation. It took about three months to finish, according to McLaughlin, and getting it done smoothly in a busy hospital setting wasn&rsquo;t a problem. &ldquo;It was pretty seamless,&rdquo; he says. &ldquo;We already had the valves needed for the biomass boiler in place, so there was no shut-down time.&rdquo;&nbsp;&nbsp;&nbsp;
 The 700-kilowatt, 2,200 MMBtu/hour low pressure steam boiler went live Dec. 7, and will annually consume 665 tons of wood pellets.&nbsp; Athens, Maine-based supplier Maine Wood Pellets is delivering fuel pellets to MHR, which are being stored in a 36-ton silo that sits outside the building. On how often deliveries are required, McLaughlin said one every two weeks during the coldest part of the winter season.
 Plant operation staff is on during the day, but just on call at night. &ldquo;It can be monitored from anywhere you have access to the Internet,&rdquo; McLaughlin explains. &ldquo;To do a hard reset you have to be there physically, but otherwise it can be operated remotely. It&rsquo;s a real basic design.&rdquo;
 Via an automated system, ash produced on the back end of the system&mdash;a very minimal amount&mdash;is sent into a barrel on wheels that fits onto a regular-sized pallet. Since installation, the barrel has only had to be emptied four times, according to McLaughlin.
 If the MRH had paid the full $5 million price tag, a return on investment would be expected in about five years. Thanks to the Wood-2-Energy Program grant of $258,978, it&rsquo;ll be achieved in 2.5 years. McLaughlin&rsquo;s meticulous fuel cost calculations indicate that from the startup date to March 1, about $75,000 was saved.&nbsp; &ldquo;We also like the fact that the money is being spent on wood pellets,&rdquo; he adds. &ldquo;It&rsquo;s still in the U.S. and, even better yet, here in our area.&rdquo;
 Vienneau adds that the region needs any help it can get economically, as its once booming paper industry is depressed. &ldquo;Anything that can be done for wood workers to find other customers for their goods is a good thing [for the region&rsquo;s economy],&rdquo; she says.&nbsp;
 MRH, as well as Northern Maine Medical Center, which brought a pellet heating system on line shortly after MRH, will now serve as an example to other hospitals or institutions in the area looking to switch fuels. And there are many mulling it over, Vienneau says. &ldquo;A lot of hospitals are looking at alternative energy sources&hellip;several in our area are going to natural gas, which is cheaper than oil, but not as cost effective as pellets right now.&rdquo;
 As for advice for those evaluating wood pellets, McLaughlin says he advises them to contact MRH directly with any questions. &ldquo;It&rsquo;s not a huge transition,&rdquo; he says. &ldquo;And it&rsquo;s just a win-win to us and the local community.&rdquo;
 MRH hopes to eventually expand the system to be able to use it year-round. Vinneau adds that over 10 years, the hospital is projecting to save nearly $2 million. &ldquo;That $2 million can go directly toward improving our hospital through the expansion of services, job creation or even upgrading equipment.&rdquo; Author: Anna Simet Managing Editor, Biomass Magazine <a href="mailto:asimet@bbiinternational.com">asimet@bbiinternational.com</a> 701-751-2756

JACK OF TRADES: Dale McLaughlin has held his position of director of plant operations for over 15 years.

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STEALTHY STORAGE: MRH's wood pellet silo can store up to 36 tons of wood pellets at a time. 

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HUNGRY AUGER: The auger-fed wood pellet boiler system at MRH will consume about 665 tons of pellets annually.

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Maine's Millinocket Regional Hospital is the first hospital in Maine. to bring on line a wood pellet-fired heating system.

Why We Did It

The U.K. Department of Energy and Climate Change has proposed increasing the tariff levels for heat generated by large biomass systems, ground source heat pumps and solar thermal kits accredited under the government&rsquo;s Renewable Heat Incentive scheme. The move could benefit office buildings, factories and community centers by providing more cash for renewable heat.
 The proposed tariff levels are designed to increase uptake of the three listed technologies. According to the DECC, it is not proposing to increase the tariffs for small and medium biomass systems due to current high levels of demand for those technologies. A consultation on the proposals was to will close June 28.
 &ldquo;The Renewable Heat Incentive has been running for nearly 18 months, so now is a timely moment to look again at the tariffs,&rdquo; said Energy and Climate Change Minister Greg Barker. &ldquo;We need to make sure they are set at the right level to continue bringing forward investment and growth and at the same time keep costs to the taxpayer to a minimum. That&rsquo;s what our proposals set out today are designed to do.&rdquo;

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UK proposes increasing renewable heat  incentive for large biomass systems 

A new coalition in Massachusetts has formed to advocate for renewable heat policies within the state. The Biomass Thermal Energy Council, the Massachusetts Forest Alliance, and the Coalition for Renewable Natural Gas are among the biomass-focused organizations that have formed the new Massachusetts Renewable Thermal Coalition.
 The coalition is urging for support of Massachusetts legislation, S. 1593, that would add renewable thermal energy technologies and fuels to the state&rsquo;s Alternative Portfolio Standard.&nbsp; &ldquo;For the last decade, the commonwealth has been a leader in promoting technologies that generate renewable electricity. But until now, our renewable energy strategy has lacked similar incentives for renewable heating fuels. This bill closes that gap and brings us one step closer to achieving the goals set forth in our Global Warming Solutions Act of 2008,&rdquo; said State Sen. Barry Finegold, who is sponsoring the legislation.
 &ldquo;Thermal energy represents more than one-third of all energy consumed in Massachusetts,&rdquo; says David O&rsquo;Connor, former Commissioner of the Massachusetts Department of Energy Resources. &ldquo;Despite this, support for renewable heat through state policy has been very limited, while promotion of renewable electricity generation gets significant attention.&rdquo;

Massachusetts coalition  urging thermal parity

The U.S. Energy Information Agency recently released 2011 residential energy generation data showing that solar is making gains, and added the equivalent of nearly 40 trillion Btu in 2011. Comparatively, wood and pellet stoves added just 30 trillion Btu in 2011, yet, according to EIA statistics, wood heating still produces three times more energy than solar panels and 11 times more than geothermal.
 New EIA projections, however, predict solar may only produce the equivalent of .21 quadrillion Btu of energy in 2040, and that wood heat will produce .45 quadrillion Btu. This assumes a continuation of existing incentive policies that heavily favor solar. How many policymakers know that our government is predicting wood and pellet heating to still double the capacity of residential solar PV, even with all the rebates and incentives? I expect not many.
 Residential solar and wood and pellet heat share some key attributes: both are distributed sources of energy powered by the sun. Solar panels convert the sun&rsquo;s energy directly through photovoltaics, whereas wood and pellet stoves and boilers convert it through photosynthesis, storing it in the tree for later use. They complement each other beautifully, as one produces kilowatts and is inefficient to heat with, while the other produces Btus and is inefficient for electricity.
 Solar is typically installed by urban, educated, wealthy families whereas wood and pellet stoves tend to be installed by rural, low- and middle-income families.&nbsp; Policies that give generous incentives to wealthier families, and not to middle-income families, for their respective technology of choice are based on an array of values, perceptions, assumptions and choices.&nbsp;
 The growth differential is partially due to state, not federal, incentive structures. From 2010 to 2011, 70 percent of the growth in solar occurred primarily in California and Florida, states with healthy incentives. With wood and pellet heating, the growth is far more incremental and organic across many states. Five states provide some state-level incentives for modern U.S. EPA certified stoves, but are far less generous than solar incentives. Even without significant federal or state incentives or rebates, wood and pellet stoves added far more capacity than solar panels between 2006 and 2008.&nbsp;
 The EPA is about to announce new emission regulations for wood and pellet heating equipment, including furnaces and boilers that will be far stricter than existing regulations. Currently, wood and pellet stoves can emit up to 7.5 grams per hour. The EPA has floated a 1.3-gram-an-hour threshold to take effect 5 years after promulgation.&nbsp; The emergence of cleaner and more efficient wood and pellet equipment is likely to help the growth of wood and pellet heating, as it has in Europe. There is also a green label for wood and pellet equipment being developed in the U.S., to help consumers easily identify the cleanest and most efficient heaters, and enable states to use that label in incentive programs.&nbsp;
 If the U.S. government predicts that residential wood heating will produce double the energy of residential solar PV, does this argue for even more aggressive solar subsidies? I believe we need to build on what works, and that means creating technology-neutral incentive structures. This would allow the consumer to decide what makes the most sense for their situation, based on their values, assumptions, and economic situations. Maine Sens. Angus King and Susan Collins just introduced S. 1007, the Btu Act of 2013, which seeks to include high-efficiency wood and pellet appliances in the provision of the IRS tax code currently giving&nbsp; a 30 percent consumer tax credit only for solar PV.&nbsp; Let the consumer decide, not the policymakers who seem to think solar PV is the only solution.&nbsp;
 The cleanest and most efficient wood and pellet appliances deserve incentives, otherwise consumers will likely buy less clean and less efficient appliances, or will keep using existing technology that is often very polluting and inefficient. It is time we guided the wood and pellet sector, as Europe has, maximizing its benefits instead of continuing to rely on outdated equipment.
 Author: John Ackerly President, Alliance for Green Heat 301-841-7755 <a href="mailto:jackerly@forgreenheat.org">jackerly@forgreenheat.org</a>

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Residential Solar Spreading, But  Outperformed by Wood Heat

Jonathan Cedar and BioLite co-founder Alexander Drummond met in a product design shop in New York in 2006. Quickly realizing they shared a passion for sustainable design, the two went to work developing a camping stove that operated on a fuel other than petroleum products. A last minute entry&mdash;and subsequent win&mdash;at a clean stove competition at a conference focused on biomass use in developing nations led to the development of the company&rsquo;s HomeStove product. With the product's design now finalized, BioLite is working to grow distribution so more people can benefit from the powerful tool Cedar and his team have created. Talk a little about your background. My background is in engineering and environmental science. I did my undergraduate work at Dartmouth&rsquo;s school of engineering. After that, for a few years, I did a combination of undergraduate teaching and energy research with an oceanographic research group. BioLite started as a nights and weekends project back in 2006, with my co-founding partner, Alec Drummond, during which our initial objective was to create a camping stove that didn&rsquo;t require petroleum. The insight was that by using a fan to force air into the combustion mixture in particular ways, you could promote certain types of gasification or secondary combustion that made wood extremely clean and easy to use as a fuel, which was surprising to us at the time. What were some of your earliest efforts in product design? I&rsquo;ve always been a tinkerer type. Going back to when I was a little kid, I probably broke every possession my parents owned trying to take it apart and figure out how it worked. In high school, I spent half of my afternoons scrounging around junkyards for old motor parts to build go-karts. In college, my engineering program, while no one was talking about product design, was very much design and build. Half of every course was a rote knowledge component, and the other half was taking the theory and the calculations and applying it to a real world system. For example, if it was a thermodynamics course, you would do the math behind a sterling engine, but you would also go down to the machine shop and fabricate an innovation on the sterling engine that would improve the temperature differential. You would have to actually build one and make it work. Can you explain the prototyping of BioLite&rsquo;s first effort, the CampStove? We had the luxury and burden of having to go through five to seven full-scale generations of the product over a five-year period. I think for a normal company that would be a heck of a lot of time, especially for an early stage company. But we started with very simple, quick and dirty proof of concept prototypes: folded sheet metal; cutting the inside out of a stainless steel thermos and punching a bunch of holes in it. We tried to break it out and design each of the systems separately, so we built ways to adjust primary and secondary airflows independently. We did a lot of refinement of the systems at the individual scale, and then in each generation we would refine the individual systems, build them back up into an integrated prototype and kept that. &nbsp; What triggered the development of the HomeStove? It seems the market for this product is completely different than the market for the CampStove, yet the technology is virtually the same. In 2008, when we were on our third iteration of the CampStove and the prototype was becoming a recognizable product, we went to a clean wood combustion conference&mdash;with a camping user still in mind&mdash;with the thought that we were going there to learn more about advanced biomass combustion. It turned out to be very different. First of all, the conference was almost exclusively about the use of biomass as a primary fuel in developing countries. Every day, 3 billion people cook on wood, and the emissions from those fires kills 4 million people every year, more than malaria and HIV combined. So our eyes were opened to the need. At the same time, we had our funny little prototype and we entered it into the clean cook stove competition that year&mdash;really impromptu&mdash;and we ended up winning the cleanest stove of the year award. We were the only stove that wasn&rsquo;t plugged into a wall outlet to achieve those low levels of emissions. Can you elaborate on how the CampStove and HomeStove work? The stoves are both what we call closely coupled gasifiers. The HomeStove is built around the combustion architecture commonly known as a rocket stove. This is a rocket stove with limited primary air and forced secondary combustion. It&rsquo;s mixing methodologies of a closely coupled gasifier and a side-fed stove, allowing the use of much larger pieces of wood, essentially logs that may be used in a potbelly stove. The product and the combustion technologies are somewhat different between the two, but what is the same is the thermoelectric system that drives the forced air for mixing, also creating extra electricity that can be used to charge mobile phones, LED lights, or anything that is USB chargeable.
 We first saw the application in these potbelly stovetop fans that use the heat from the top surface of the stove as a power source to circulate heat around the room. We thought, &ldquo;We&rsquo;ve got 5 kW of heat in this fire, and we only need a couple of watts of electricity to do some pretty useful stuff.&rdquo;&nbsp; You are deploying large-scale pilot programs in India, Ghana and Uganda. What do you hope to learn and iron out as a result? We&rsquo;ve been through two and a half years of prototype refinement, and qualitative product testing and market analysis of the home stoves. Now, we&rsquo;re trying to answer three questions in what we call &ldquo;at-scale commercial pilots.&rdquo; The first question regards the willingness to pay. The second question is how we work effectively with our distribution partners there. In a place where there is no Walmart, Target or REI, what does it take for us to be effective partners? Of the partners we were working with initially, most of them looked like Avon models of sale where local village-level representatives essentially do door-to-door sales. There would be a public demonstration and an opportunity to interact with the product, so how do we work effectively with those partners? So that&rsquo;s the second piece&mdash;how we market it. I think the third question is, how do we support it? What kinds of ongoing maintenance will be required for the product? So far we have found very little, but we know that there will be a place where you can&rsquo;t FedEx a warranty claim back to the factory, so how do we train these agents to support the product effectively? What most excites you about bringing a more reliable energy solution to people in developing nations? If you look at the magnitude of the effect of open fire cooking in developing countries, you are talking about a problem that is something on the order of the world&rsquo;s No.1&nbsp; killer. The idea that a device like this could have impact on the scale of penicillin is a pretty humbling opportunity. It&rsquo;s hard to wrap your mind around that on a daily basis. I think what gives us a lot of pleasure is going into markets where companies haven&rsquo;t spent as much time thinking about what consumers want, and what will make their lives easier and more pleasurable on a day-to-day basis. Being able to say, &ldquo;Hey we&rsquo;ve thought a lot about this and I think you are really going to enjoy using it.&rdquo; Not even talking about the health benefits, just talking about the same product attributes that make you and me want to buy an iPhone, and seeing the pleasure on people&rsquo;s faces when experiencing a product like that.
 Finally, I would say the piece that I&rsquo;m most excited about, personally, is the team that we&rsquo;ve built here as a company, the wide breadth of capabilities in combustion, electrical, mechanical, mass manufacture and marketing. It really feels like we&rsquo;ve built a team as a company that is ready to tackle huge problems.

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BioLite's wood-fired cook stoves are bringing clean, reliable power to people in developing countries.

Cooking Up Innovation 

In areas of Oregon not served by natural gas, there is a new fuel in town that is replacing heating oil: wood. And it&rsquo;s saving money for schools and restoring forest lands. Natural gas is the preferred fuel for heating homes and businesses in Oregon due to its relatively low cost, but the majority of the state does not have access to natural gas and instead must rely on much more expensive petroleum heating oil.
 Following the farm-to-table sustainable sourcing model, the forest-to-boiler movement is picking up steam. Oregon is among the leaders in U.S. biomass energy production, with a total of 19 projects up and running at schools, hospitals, airports and other facilities. Wood pellet boilers currently heat 12 schools&mdash;up from only two in 2010&mdash;and those that have switched from oil to wood pellets or wood chips are saving between $20,000 and $120,000 annually on heating costs.
 Saving money and using a renewable fuel is great for small towns and schools, and it&rsquo;s also great for the neighboring national forests. Since the decline of the timber industry in the early 1990s, forests in eastern Oregon have grown to an unhealthy, fire-prone condition. Restoration projects are underway each year to thin overcrowded and dead trees, but the U.S. Forest Service is still struggling to fund the amount of work necessary to return the forests to historic, fire-adapted conditions where forest fire is natural and beneficial instead of widely destructive.
 Twenty years ago, the primary barrier to forest management projects in the West was heated disagreement over how to treat the forest&mdash;one side wanted to protect it, while another wanted to keep the mills running. This conflict has largely been resolved, as opposing interests have found new ways to work together. Now, the main challenge is funding. Forest restoration work needs to be profitable, otherwise it can&rsquo;t happen.
 Wallowa County in northeastern Oregon is taking an innovative approach to addressing this challenge. A partnership between local businesses, a local nonprofit, and the county government created an integrated biomass campus that is able to process a variety of local tree species and log sizes into various marketable products, including heating fuels, firewood, landscaping timbers and post and poles. This increased revenue stream provides an incentive for the forest service to implement additional restoration projects, and allows for more acres to be restored. Historically, different log species and sizes would have been sent to separate mills, greatly increasing the cost of transportation, thus lowering the value of the wood, the subsequent sticker price, and the impetus for restoration. In addition, having that many more log trucks in the forest would require a much larger landing site, the clearing in the forest where the logs are piled, sorted and loaded onto trucks. The integrated campus includes a sorting yard allowing for a much smaller forest impact.
 It also helps reduce carbon and air particulates by making use of the slash&mdash;the underbrush, branches and tiny trees that get piled up during thinning projects. The forest service is required to remove the piles since they add fuel to wildfires, and, without a cost-effective use for them, the slash piles are otherwise burned in the forest. Now the piles are being sent to the biomass campus in Wallowa, Ore., for processing into wood fuel, some of which is used at the facility in a 100-kilowatt combined-heat-and-power biomass plant that brings onsite material efficiency close to 100 percent. The remaining wood fuel is sold in the local market for use in high-efficiency,U.S. EPA-certified boilers that have significantly lower particulate and carbon output than slash piles.
 All of this adds up to incredible cost savings, and a renewable local system of restoration and efficient use of natural resources, not to mention the jobs that are created in the forest and the mills. But funding restoration projects&mdash;the keystone of the whole system&mdash;is still a huge challenge. The federal government is stuck in a cycle of fire suppression. Wildfires in the West are greatly increasing in scale and severity as the effects of climate change set in. In 2012 alone, 9 million acres (14,062 square miles) burned in the nation, of which 600,000 acres were in Oregon.
 Through our Dry Forest Investment Zone program, Sustainable Northwest has helped establish conditions that allow integrated biomass campuses to be established in Oregon, and we continue to advocate for increased funding for large-scale federal forest restoration projects. Last year, the U.S. Forest Service spent $3 billion&mdash;half its annual budget&mdash;fighting wildfires, but only $350 million on forest management and restoration. We&rsquo;re working to change that ratio.
 In addition to holding budget conversations with federal land management agencies and Congressional appropriations committees this spring, our rural policy network met with Congressional staff about reauthorization for the Community Wood Energy Program in the Farm Bill. The Senate Farm Bill supports a five-year reauthorization at the level of $5 million annually, with the House version also supporting a five-year reauthorization, but at only $2 million per year. Barring an unlikely untying of House purse strings, we&rsquo;ll be happy to see a compromise in the final version.&nbsp;
 There is increasing state and national attention on the symbiosis of local biomass energy production and forest restoration. The Obama administration is looking for ways to incentivize biomass energy development projects across the country. One possible pathway is through investment tax credits. Maine Sen. Angus King recently introduced the Biomass Thermal Utilization Act of 2013, which would create parity between biomass and other renewable energy credits, such as wind and solar, for thermal energy purposes.
 Last August, Oregon received a Forest Service pilot grant to develop biomass energy cluster projects that will use residuals from forest restoration for heating energy. Six groups each received between $9,000 and $50,000 to perform feasibility and engineering studies for biomass conversion projects. The intent of this pilot is to replicate successful results from Oregon in other states across the country. In the meantime, the Oregon Department of Energy is working to establish financing mechanisms to help suitable projects with implementation.
 As we see more and more positive results from innovative systems like forest-to-boiler, it&rsquo;s easy to remain optimistic that our small towns will continue to rebound. As long as we remain on an upward trend, counties will continue to save money and see increased independence from fossil fuels. Author:&nbsp; Renee Magyar Marketing Manager, Sustainable Northwest <a href="http://www.sustainablenorthwest.org">www.sustainablenorthwest.org</a> <a href="mailto:rmagyar@sustainablenorthwest.org">rmagyar@sustainablenorthwest.org</a> 503-221-6911

WARM LEARNING: On a snowy winter day in John Day, Ore., Grant Union High School is heated with local, renewable wood fuel. 

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Community-based biomass projects restore economic vitality and forest health, but funding forest restoration—the lifeblood of many projects— poses challenges.

Oregon's Forest-to-Boiler Movement 

The U.S. EPA has published a proposed rule to allow renewable diesel, renewable naphtha, and renewable electricity produced from landfill gas and used to power vehicles to generate cellulosic or advanced biofuel renewable identification numbers (RINs) under the renewable fuel standard (RFS). In addition, renewable compressed natural gas and liquefied natural gas produced from landfill biogas would also be able to generate cellulosic RINs.
 "Without commenting on any particular part of the rule making, the ABC is pleased that the EPA has issued the notice of proposed rulemaking," said Patrick Serfass, American Biogas Council executive director. "ABC as an organization and many of its member companies have been anticipating the release of this rule for some time. We are very excited to be working with the EPA to shape a pathway for biogas and its transportation uses, and look forward to a final rule being released later this year."
 The proposed rule also includes several other amendments to the RFS, including those allowing biobased butanol to qualify as an advanced biofuel and clarifying the definition of crop residue to include corn kernel fiber.

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EPA proposes to allow landfill gas-based  fuels to generate RINs under RFS

Canadian rendering company Sanimax and Wisconsin-based engineering and construction firm Green Energy Partners are partnering to develop a $30 million anaerobic digester in South St. Paul, Minn. The proposed SaniGreen Bioenergy facility will produce pipeline-quality biogas. A portion of the biogas produced will also power the facility via a 1.1 MW generator.
 Once complete, the new facility will take in 150,000 tons of solid and liquid organic waste annually. Feedstock will be sourced from local schools, grocery stores, municipalities and food processing facilities.
 Construction is expected to begin this fall, with completion scheduled for March 2015. The facility will be located near an existing Sanimax rendering facility and an Excel Energy electrical and natural gas distribution center.
 According to Dan Ostrenga, director of organic solutions at Sanimax, co-locating the new anaerobic digestion facility with its current rendering facility will create a &ldquo;green campus&rdquo; atmosphere and offer a sustainable solution to local industries interested in diverting waste from landfills.

AD project planned  near rendering plant 

It&rsquo;s difficult to talk about the future of the biogas industry without a discussion of diverting organics. After all, organics or organic waste is the &ldquo;fuel&rdquo; that drives the nonstop production of renewable biogas. With the June 20 signing of Connecticut&rsquo;s Public Act 13-285, An Act Concerning Recycling and Jobs, the Constitution State will start to divert organics to organics recycling facilities next year. At the same time, we might be observing the beginning of a new pattern that will be very good for biogas and composting businesses. It can also easily benefit waste haulers and others in the waste management industry.
 In industry-speak, diverted organics usually means food waste or yard waste, the most common types of organic waste that can be separated by the waste generator.
 The pattern begins with two New England states building on each other's good ideas.&nbsp; Connecticut got the ball rolling in October 2011 with the passage of Public Act 11-217, which required large commercial waste generators (more than 104 tons per year) to divert food waste if they were within 20 miles of a licensed facility. However, that requirement only kicked in six months after two licensed facilities could accept the material&mdash;a high risk for the first developer to not know when the second system would be built.&nbsp;
 Nine months later, Vermont signed into law Act 148, An Act Relating to Establishing Universal Recycling of Solid Waste, which borrowed the Connecticut model of applying the law to large generators, but took it a couple steps further by gradually ratcheting down the threshold from 104 tons per year of food residuals all the way down to all food residuals in 2020.&nbsp; Vermont also required a recycling facility to be within 20 miles of the waste generator for the law to activate.&nbsp;
 Connecticut returned the favor this year in Public Act 13-285, which keeps the 104-ton- per-year starting point for commercial generators, reducing to 52 tons per year in 2020. Again, the key is that the requirement only applies if a licensed facility exists within 20 miles of a generator.&nbsp;
 This approach, which requires organics diversion once local infrastructure exists, is the key to building biogas and composting companies in the U.S. and incentivizing the development of new, local businesses. It ensures that if a developer builds a system nearby, they&rsquo;ll have organic waste to feed it. That&rsquo;s the start of a viable business model, the creation of new jobs and infrastructure that protects and improves the environment. Ideally, it also alleviates a mantra many of us have heard regarding yard waste bans: &ldquo;no ban without a plan.&rdquo;&nbsp; These are bans with a plan.
 Since Connecticut&rsquo;s law doesn&rsquo;t get activated until Jan. 1, 2014, and Vermont&rsquo;s&mdash; although passed the year before&mdash;doesn&rsquo;t activate until July 1, 2014, in many ways, it&rsquo;s too early to claim success. Yet, the passage of these two bills provides a significant step forward for the organic waste sector of the biomass industry&mdash;especially financing new projects. They also beg the question: Could this kind of policy, once that requires organic waste generators to send their waste to a recycling facility if such a facility exists nearby, be one that might be adopted in other states? And perhaps federally?
 The American Biogas Council and partner in this effort, the US Composting Council, certainly hope so. We also hope those of you reading this will join us as we take more steps to advance the biogas, composting and organics recycling industry.
 Author: Patrick Serfass Executive Director, American Biogas Council <a href="mailto:pserfass@ttcorp.com">pserfass@ttcorp.com </a> 202-640-6595

July 2013

Business Briefs

Business Briefs

Business Briefs

Columns

This is War!

Let's Start Imagining Win-Win-Win Scenarios

Asking the Right Questions

Big Oil Talks Out of Both Sides of Mouth

Strategies to Reduce Litigation Angst

Overcoming the Blend Wall With Our Opponents' Medicine

Keep on Fighting the Fuel-Food Fallacy

Small-Scale Biomass Delivers Big Benefits

Fueling Misplaced Outrage

Residential Solar Spreading, But Outperformed by Wood Heat

Vermont, now Connecticut, Models for Diverting Organics

Overcoming Regulatory and Legislative Volatility

Positioning for Success

Featured

Lowering Ethanol's Carbon Footprint with Energy Beets

Culture of Compliance

Cellulosic Technology— Pulp and Paper Style

Pretreated Biomass for Food and Fuel

“Where Producers Meet”

Q&A: Driving American Ethanol to the Front

Rise of the Portables

Contributions

Finding Business Success in a Changing Ethanol Industry

Going Deep With Enzyme Technology

Oregon's Forest-to-Boiler Movement

Departments

Why We Did It

Cooking Up Innovation

Equipment Profile: Biogas-powered Fuel Cells

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Business Briefs

Business Briefs

Business Briefs

Columns

This is War!

Let's Start Imagining Win-Win-Win Scenarios

Asking the Right Questions

Big Oil Talks Out of Both Sides of Mouth

Strategies to Reduce Litigation Angst

Overcoming the Blend Wall With Our Opponents' Medicine

Keep on Fighting the Fuel-Food Fallacy

Small-Scale Biomass Delivers Big Benefits

Fueling Misplaced Outrage

Residential Solar Spreading, But Outperformed by Wood Heat

Vermont, now Connecticut, Models for Diverting Organics

Overcoming Regulatory and Legislative Volatility

Positioning for Success

Featured

Lowering Ethanol's Carbon Footprint with Energy Beets

Culture of Compliance

Cellulosic Technology— Pulp and Paper Style

Pretreated Biomass for Food and Fuel

“Where Producers Meet”

Q&A: Driving American Ethanol to the Front

Rise of the Portables

Contributions

Finding Business Success in a Changing Ethanol Industry

Going Deep With Enzyme Technology

Oregon's Forest-to-Boiler Movement

Departments

Why We Did It

Cooking Up Innovation

Equipment Profile: Biogas-powered Fuel Cells

July 2013