IFB Ethanol Blog

Ethanol Blend Debate

Illinois Farm Bureau and the Illinois Corn Growers Association are gearing up for debate over proposals to boost ethanol blend levels -- a step Monticello grower Jim Reed sees as crucial to overall domestic energy development.

While corn growers also are working with lawmakers to break the existing 10% ethanol gasoline "blend wall," ICGA Industrial Committee chair Reed reported efforts are focused on USEPA review of a blend waiver request filed by industry group Growth Energy and 54 ethanol producers.

EPA is collecting public comments through May 20 on proposals to raise the maximum blend level in conventional gasoline to 15%, hoping to gauge how "E15" would affect vehicle emissions, fuel distribution and marketing, and domestic fuel programs.

Check the May 4th edition of FarmWeek for additional details.

California Adopts Low-Carbon Fuel Standard

The American Farm Bureau Federation is disappointed in the indirect land use provisions of a ruling made Thursday by the California Air Resources Board (CARB) to mandate carbon-based reductions in transportation fuels. Farm Bureau is concerned that the low carbon fuel standard could set precedent and be adopted by other states and the federal government.

AFBF remains concerned that the indirect land use provision of the California decision could unfairly target ethanol at the expense of gasoline. In addition, the findings unfairly exaggerate the effects of using field crops for energy and put ethanol at a competitive disadvantage.

The CARB decision sets an additional carbon penalty against biofuels only, increasing the carbon source of these fuels by 40 percent or more because of the indirect land use provisions. In a letter sent March 25 to California Gov. Arnold Schwarzenegger, AFBF cautioned that the science of predicting indirect, economically derived carbon effects is extremely new and uncertain.

However, CARB did agree to convene an expert working group to assist them in “refining and improving the land use and indirect effect analysis of transportation fuels.” Ethanol industry leaders hope the formation of this working group will result in a more balanced and fair assessment of the indirect greenhouse gas effects of all fuels.

Ethanol Plant Closures

Ethanol plant closures continue, along with reductions in production. Iowa State’s Roger McEowen reports 37 of the 193 US ethanol plants are out of business, 23 of them built since 2005. He says that represents 19% of the plants and 18% of production capacity, totaling 2.2 bil. gal. Read more.

(Thanks to Farmgate blog)

Biodiesel Industry Needs 'Stabilizing Signal'

Amid headlines about ethanol bankruptcies and restructuring, it may be easy to overlook hard times in the biodiesel industry.

National Biodiesel Board (NBB) President Joe Jobe nonetheless is optimistic biodiesel producers can weather the economic downturn through feedstock diversification and federal policies that “send a stabilizing signal” to the industry.

“The biodiesel industry hasn’t been spared by the recession,” Jobe told FarmWeek. “Diesel fuel demand is down; diesel fuel prices are way down.

 “The general state of the economy, lack of access to capital and credit -- all those factors combined are having a real crippling effect on the biodiesel market right now. And then combine that with unstable signals from Washington.”
He stressed need for long-term extension of the federal biodiesel blenders tax credit now set to expire by year’s end. The credit has helped generate 100 biodiesel “refineries” and more than 50,000 “green jobs,” Jobe said.

NBB also seeks to restructure the credit as an incentive for biodiesel producers, rather than merely blenders, to help stimulate supplies. The national renewable fuels standard (RFS) calls for 500 million gallons of U.S. renewable diesel fuels use in 2009 alone.

Ethanol and biodiesel producers share anxieties over potential U.S. Environmental Protection Agency (EPA) RFS rules.

(Source: FarmWeek)

 

Blackhawk Biofuels Update

Blackhawk Biofuels LLC has announced completion of construction upgrades that should result in new production capabilities and broader feedstock use at its Danville biodiesel plant.

The 45-million-gallon-per-year facility can now use a wider array of fats and oils such as recycled kitchen grease.

The improvements were announced roughly one week after Texas-based Nova Biosource Fuels, which owns a 60-million-gallon-per-year biodiesel operation in Seneca, IL, filed for Chapter 11 bankruptcy protection.  The company reportedly hopes to continue operations at least in Illinois and Iowa.

(Source: FarmWeek)

Biofuels and Water Use

The production of bioethanol may use up to three times as much water as previously thought, a new study finds, becoming the latest work that could burst the biofuel bubble.

A gallon of ethanol may require up to more than 2,100 gallons of water from farm to fuel pump, depending on the regional irrigation practice in growing corn, according to the study detailed in the April 15 issue of journal Environmental Science & Technology.

But the water usage isn't quite so high everywhere: A dozen states in the Corn Belt consume less than 100 gallons of water per gallon of ethanol, making them better suited for ethanol production, the study found.

Aventine Files Chapter 11 Bankruptcy

Aventine Renewable Energy has filed for Chapter 11 bankruptcy protection, after suffering from declining liquidity and margins.
 
The Pekin-based ethanol producer and six affiliates filed for protection from creditors on Tuesday with the U.S. bankruptcy court in Wilmington, Delaware. It said it had $799.5 million of assets and $490.7 million of debts at year-end.
 
 

Higher Ethanol Blend May Endanger Power Tool Users

Picture a chainsaw calmly idling. But then its blade suddenly starts spinning on its own, as if someone had goosed the throttle.

The power equipment industry warns that such a scenario could happen if the federal government agrees to increase the percentage of ethanol mixed into gasoline. Upping the ethanol content would add more oxygen to the fuel, causing the engine to idle at a higher speed and literally fooling the chainsaw into acting as though its clutch were engaged.

"For us, it's principally a safety issue," said Kris Kiser, executive vice president of the Outdoor Power Equipment Institute. "We make bladed and clutch equipment that is inherently dangerous."

On Wednesday a coalition backed by the power equipment, petroleum, boating and automobile industries voiced concerns to the Senate Clean Air and Nuclear Safety subcommittee that a higher ethanol mix could destroy engines, in addition to voiding warranties on vehicles designed for a 10 percent ethanol blend.