EPA Denies RFS Waiver Request

The U.S. Environmental Protection Agency (EPA) today announced that the agency has not found evidence to support a finding of severe “economic harm” that would warrant granting a waiver of the Renewable Fuels Standard (RFS). The decision is based on economic analyses and modeling done in conjunction with the U.S. Department of Agriculture (USDA) and U.S. Department of Energy (DOE).

“We recognize that this year’s drought has created hardship in some sectors of the economy, particularly for livestock producers,” said Gina McCarthy, assistant administrator for EPA’s Office of Air and Radiation. “But our extensive analysis makes clear that Congressional requirements for a waiver have not been met and that waiving the RFS will have little, if any, impact.”

To support the waiver decision, EPA conducted several economic analyses. Economic analyses of impacts in the agricultural sector, conducted with USDA, showed that on average waiving the mandate would only reduce corn prices by approximately one percent. Economic analyses of impacts in the energy sector, conducted with DOE, showed that waiving the mandate would not impact household energy costs.

EPA found that the evidence and information failed to support a determination that implementation of the RFS mandate during the 2012-2013 time period would severely harm the economy of a State, a region, or the United States, the standard established by Congress in the Energy Policy Act of 2005 (EPAct).

EPAct required EPA to implement a renewable fuels standard to ensure that transportation fuel sold in the United States contains a minimum volume of renewable fuel. A waiver of the mandate requires EPA, working with USDA and DOE, to make a finding of “severe economic harm” from the RFS mandate itself.

This is the second time that EPA has considered an RFS waiver request. In both cases, analysis concluded that that the mandate did not impose severe harm. In 2008, the state of Texas was denied a waiver.

Pacific Ethanol To Extract Corn Oil At It’s Stockton Plant

Pacific Ethanol, Inc. announced it will implement corn oil separation technology at its Stockton plant, representing the second Pacific Ethanol plant to utilize the technology. In June 2012, the company announced the implementation of corn oil separation technology at its Magic Valley plant. The company has awarded Edeniq, a biomaterials and sustainable fuels innovator, with a contract for its patented OilPlus™ technology, which is expected to be implemented at the Stockton plant by the second quarter of 2013.

Neil Koehler, the company’s president and CEO, stated: “Corn oil is a high value co-product for the Pacific Ethanol plants, provides us with further diversification of our revenue streams and contributes additional operating income to the plants. Our Stockton plant is the second of our facilities to implement corn oil separation technology, and we expect to soon award contracts for our two other Pacific Ethanol plants.”

First Station in the Nation Begins Selling E15

For the first time in nearly three decades, American drivers can now choose a new fueling option at the pump.  The nation’s first E15 (15 percent ethanol/85 percent gasoline) gallons are being sold at the Zarco 66 “Oasis” station at 1500 E. 23rd Street in Lawrence, KS

A formal grand opening for the pumps will occur on Wednesday, July 18, 2012.

On June 8, 2012, the U.S. Environmental Protection Agency (EPA) gave final approval for the sale and use of E15 ethanol blends in light duty vehicles made since 2001.  This represents nearly two-thirds of all vehicles on the road and nearly three-fourths of all miles driven.

Given present market conditions, E15 will sell for less than E10 and gasoline not containing ethanol. More broadly, a recent study from the Center for Agriculture and Rural Development found the use of 13.9 billion gallons of ethanol in 2011 lowered average gasoline prices by $1.09 per gallon nationally and by $1.69 per gallon in Midwestern states such as Kansas. 

“Alternatives to gasoline are critically important to our nation’s energy future and Americans deserve to have a choice of cost-competitive fuel at the pump,” said Scott Zaremba, owner of Zarco 66 stations.  “With the help of the Kansas Corn Commission, East Kansas Agri-Energy, and the Renewable Fuels Association, we are pleased to be the first to offer consumers real choice at the pump in the form of E15 ethanol fuel.”

Zaremba, the incoming President of the Petroleum Marketers and Convenience Store Association of Kansas, blends Zarco 66 fuel options right at each of his stations.  Pumps offering E15 with the proper labeling will also be offering E10 and other ethanol blends via technology known as blender pumps.  These pumps allow consumers to choose the fuel option that is best for them and their vehicle.

“Ethanol is a vital component of our nation’s energy and economic strategy and moving to higher level ethanol blends like E15 just makes sense,” said Jere White, Executive Director of the Kansas Corn Commission and the first consumer to purchase E15 under the waiver granted by the EPA.  “Since the days of gasohol, ethanol has been an increasingly important part of our nation’s fuel supply.  America’s farmers, together with America’s ethanol producers, have risen to the challenge and provide a safe, reliable, and growing source of renewable fuel.  E15 and increasingly higher ethanol blends will reduce our dependence on imported oil, create domestic jobs that cannot be sent overseas, and leave a cleaner environment for generations to come.”

“By a margin of three to one, Americans are clamoring for real choices at the pump.  The roll out and adoption of E15 is the first step in delivering Americans the choice they want and deserve,” said RFA President and CEO Bob Dinneen. “E15 has been the most vigorously tested fuel to be approved by the EPA.  Ethanol has long proven itself to be a safe and effective fuel for consumers, and E15 will be no exception.  I want to congratulate Scott for taking the initiative and taking the historic step to be the first to offer E15.  When given an option, Americans will choose a domestic renewable fuel that is creating jobs, reducing oil dependence, and lowering prices at the pump here at home.”

Source : Renewable Fuels Association

NCERC Researchers Produce First Cellulosic Ethanol From Corn Kernel

Researchers at the NCERC today announced that they have successfully produced ethanol from the cellulosic portion of the corn kernel.

“This research is demonstrated proof of the viability of ‘generation 2.0 ethanol,’” NCERC Director John Caupert said. “By utilizing existing technologies readily available in the commercial marketplace, the NCERC was able to produce a biofuel that builds upon the strengths of conventional corn ethanol and the promise of cellulosic ethanol, thus making bolt-on cellulosic ethanol a reality.”

Caupert added that the potential for cellulosic ethanol has significant immediate and long-term impacts on the biofuels industry generally and the ethanol industry specifically.

“Any of the 211 existing ethanol plants in the United States could be retrofitted with existing bolt-on technologies to produce cellulosic ethanol from corn without the need to build new facilities,” Caupert said. “This translates into opportunities for jobs and economic development, particularly in rural areas.

According to the Illinois Renewable Fuels Association, the ethanol industry provides more than 4,000 full-time jobs with an economic impact exceeding $5.29 billion in Illinois alone. There are currently 14 ethanol plants online in the state.

NCERC Assistant Director of Biological Research Sabrina Trupia emphasized the importance of the demonstration in future research opportunities.

“This is a significant milestone with immediate industry impact, but producing cellulosic ethanol from corn bran is also proof that cellulosic ethanol could be produced at NCERC utilizing any cellulosic feedstock,” Trupia said. “From a research perspective, this is only the first step in a very exciting road toward a future of energy security.”

The NCERC credits a series of actions, grants and capital gifts for making the research possible, including the formation of the NCERC Technical Advisory Committee in 2008, the Center’s 2009 Advanced Biofuels Initiative, and two significant capital gift donations: a corn fractionation system (2010) and fermentation suite (2011). These steps were complemented by a research and development grant through the Illinois Department of Commerce and Economic Opportunity.

“It’s the culmination of four years of activity here at the Center, and a shining example of a public-private partnership that works,” Caupert said. “With our expanded fermentation capabilities, the Center is actively seeking industry, academic, and government agency partnerships.”

USS Ford Conducts Operational Transit on Algae Fuel Blend

USS Ford (FFG 54) successfully transited from the ship's homeport in Everett, Wash., to San Diego, March 2, using 25,000 gallons of a 50/50 algae-derived, hydro-processed algal oil and petroleum F-76 blend in the ships LM 2500 gas turbines.

USS Ford's transit on the algal blend marks the first demonstration of the alternative fuel blend in an operational fleet ship.

"We've done basically every range of research vessel we could test: the experimental riverine command boat; the Naval Academy's yard patrol; a landing craft utility, a landing craft air cushion amphibious, and self defense test ship," said Richard Leung, Naval Sea Systems Command (NAVSEA) Navy Fuels engineering manager. "Each test has brought us a little closer to the upcoming Green Strike Group demonstration set for later this year."

Meeting the secretary of the Navy's call for a drop-in fuel replacement, no changes were required to the infrastructure of the ship or fueling pier for the test. The blended fuel was stationed on a barge in Puget Sound off Bremerton, Wash., and immediately available to the Ford for testing.

"We didn't embark any personnel or instrumentation for the transit because we wanted to minimize impact to the ship's normal operations and because we weren't conducting the same quantitative tests and analysis we've done previously," said Leung. "Instead, we provided the ship's engineers a list of fuel and engine performance system questions and parameters, so they could provide feedback on how the ship performed using the blend as compared to its typical fuel."

The ship burned all 25,000 gallons during the transit, and according to Leung, feedback from the ship's engineers was favorable.

"The crew reported no change in their typical procedures when receiving, handling, or processing the biofuel, and said operational performance of the fuel system and gas turbine engines on the blend was almost identical to operations on traditional F-76," said Leung.

"Having feedback from the Ford's engineers is extremely useful as we move forward with validating the algal oil blend, and as we prepare for the upcoming Green Strike Group demonstration later this year," said Greg Toms, NAVSEA technical warrant holder for Fuels and Lubricants. "We'll again be limited on the data we can collect during that event and will ask similar questions to continue measuring operational user feedback."

NAVSEA's alternative fuels efforts help the Navy increase energy security, safeguard the environment, and support the secretary of the Navy's goals to demonstrate a green strike group by 2012, deploy the "Great Green Fleet" in 2016, and obtain 50 percent of the Fleet's liquid fuel from alternative sources by 2020.

The Andersons Enters into Purchase Agreement for Iowa Ethanol Plant

The Andersons, Inc. announced today the signing of an agreement to acquire an ethanol production facility in Denison, Iowa from its owners, the Amaizing Energy Denison LLC and Amaizing Energy Holding Company, LLC. The transaction, which remains subject to several contingencies, is anticipated to close in the second quarter.

If acquired, the plant would be owned by The Andersons Denison Ethanol LLC, a wholly-owned subsidiary of The Andersons, Inc.

"As our first ethanol plant west of the Mississippi, this facility provides us with geographic diversity into some of the best corn ground in the country," says Neill McKinstray, President, Ethanol Group. "This purchase enables us to expand our ethanol production, marketing and services into a new region providing arbitrage and risk management opportunities with the three existing plants we manage while leveraging existing administrative staff to a fourth plant. With much of the same technology in all four plants, we expect to bring additional efficiencies to drive down our cost per gallon, and maximize returns to shareholders as we have successfully demonstrated during the past five years."

CEO Mike Anderson, adds, "This is a well-respected, well-run organization that brings with it a solid customer base in a geographic area that we are looking forward to serving. This ethanol facility enables us to offer our grain marketing expertise and the associated services to grain producers in Iowa and fits well with our existing presence as an investor in the Iowa Northern Railway Company and our merchandising relationship with Lansing Trade Group."

The operations consist of an ethanol facility with an adjacent 2.7 million bushel grain terminal, both with direct access to two Class 1 railroads in Iowa. The ethanol plant is a dry mill operation with a run rate of 55 million gallons per year.

Sam Cogdill, Chairman and CEO of Amaizing Energy, stated that the proposed sale will address the liquidity concerns of Amaizing Energy's membership, while retaining the economic benefits the Denison facility has in the local area.  

"Our investors committed to Amaizing Energy to earn a good return on their investment and to further local economic development and we feel great about having met both of those goals," said Cogdill. "Placing Amaizing Energy on the market while it was a profitable operation has allowed it to reach a fair deal with a great company who we know will operate our plant properly."

BioProcess Algae and Green Plains Renewable Energy Break Ground on Five Acre Production Facility

BioProcess Algae LLC and Green Plains Renewable Energy, Inc. announced that they will start construction of BioProcess Algae's five acre production facility at Green Plains' ethanol plant in Shenandoah, Iowa. The project will be comprised of a combination of at scale Grower Harvester bioreactors and a plant to further dewater and process the algae into finished product. The horizontal reactors have been successfully running outdoors since the fall of 2011 and this marks the next step in the project to commercialize algae focused on markets for animal feed, fuel, omega-3 products and high-value nutraceuticals.

"After a successful rollout of the horizontal reactors at full commercial scale, we are eager to move forward with this project producing meaningful quantities of dried wholesale algae for use in products now," said Todd Becker, President and Chief Executive Officer of Green Plains. "This new phase will mark the successful transition to a larger footprint located adjacent to our Shenandoah, Iowa ethanol plant which will provide the basic inputs the bioreactors need: carbon dioxide, warm water and heat."

"Our technology has successfully brought algae directly into the sunlight using limited inputs while increasing growth rates," says Tim Burns, Chief Executive Officer of BioProcess Algae. "We continue to work with potential strategic customers including major food, animal feed, energy and pharmaceutical companies around the world," continued Burns. "Often times, this is the first access they have had to larger quantities of wholesale algae. Our goal is to produce algae in a cost effective manner that can be used as the customer sees fit."

BioProcess Algae Grower Harvester bioreactors located in Shenandoah, Iowa have been continually running since their Phase I launch in October 2009.

ZeaChem Begins Core Facility Operations at Demonstration Plant in Boardman, Oregon

ZeaChem Inc. today announced it has completed construction of the core facility for its new integrated demonstration biorefinery in Boardman, Oregon. Construction of this core project was completed on schedule, with no lost time or reportable accidents, and significantly under budget. The core facility created 50 construction jobs and will employ 25 full-time operations staff in the region.

The core will produce the intermediate chemicals acetic acid and ethyl acetate, which are high-value products for applications including paints, lacquers and solvents. ZeaChem will sell bio-based chemicals to commercial and industrial customers seeking renewable and cost-competitive alternatives to petroleum-sourced chemicals.

“Beginning operations at the core facility is another indication that ZeaChem continues to successfully execute its strategic roadmap,” said Jim Imbler, president and chief executive officer of ZeaChem. “Our phased development approach minimizes risk by allowing us to produce marketable products as we scale up our biorefining operations. We will continue to build out our biorefinery platform to produce a broad portfolio of sustainable and economical chemicals and fuels derived from cellulosic biomass.”

ZeaChem is further developing its integrated biorefinery through implementation of a second project to add the capability of using cellulosic biomass on the front end and converting ethyl acetate into ethanol on the back end. This separate “bookends” project is currently underway and supported by a $25 million grant from the U.S. Department of Energy (DOE). Once operational in 2012, it will result in the production of up to 250,000 gallons per year (GPY) of cellulosic ethanol.

The company is now developing commercial biorefineries for the production of advanced biofuels and bio-based chemicals.

Headwaters Incorporated Announces Sale of Its 51% Ownership in Blue Flint Ethanol LLC

Headwaters Incorporated today announced that Great River Energy has acquired full ownership of Blue Flint Ethanol LLC, an ethanol biorefinery located in Underwood, ND, from Headwaters Ethanol Holdings LLC, a subsidiary of Headwaters Incorporated. Prior to this acquisition, Great River Energy owned 49 percent of Blue Flint Ethanol LLC and Headwaters Ethanol Holdings owned 51 percent.

Great River Energy is one of the nation’s largest generation and transmission cooperatives. It was the first utility in the U.S. to locate an agricultural processing facility next to a coal-fired power station. The Blue Flint biorefinery purchases process steam from Great River Energy’s Coal Creek Station facility. In doing so, Blue Flint Ethanol, the joint venture between Great River Energy and Headwaters, was able to avoid the cost of building and operating a separate boiler unit. This helped make Blue Flint Ethanol one of the most cost effective, energy efficient, and environmentally friendly ethanol plants in the country.

"We were pleased to have worked with Great River Energy over the past five years in building and operating an exemplary biorefinery. They have been an excellent partner for us," said Donald P. Newman, Headwaters' Chief Financial Officer. "Under the terms of the agreement, effective January 1, 2012, Headwaters received approximately $18.5 million in cash proceeds. Headwaters intends to use the net proceeds from the sale to reinvest in assets of its business and to strengthen its balance sheet."

Blue Flint Ethanol LLC will continue to operate as a wholly-owned independent subsidiary of Great River Energy.