EESI Announcements

EESI Briefing: Forest Biomass and Its Role in a National Renewable Electricity Standard

Renewable biomass, harvested from sustainably managed forests, has the potential to be an important contributor to a national renewable electricity standard (RES), complementing other forms of renewable power and forming part of a robust, holistic strategy for addressing climate change and building a sustainable, clean energy economy. According to the Energy Information Administration, biopower is one of the largest sources of renewable electricity in the United States, ranking second only to hydroelectric power in 2007. Furthermore, biomass is available in some form in all regions of the United States. As a baseload fuel, biomass can provide valuable backup capacity for more intermittent renewables, such as wind and solar. The cofiring of wood and coal is another important opportunity. Cofiring takes advantage of investments already made in existing power facilities and existing transmission infrastructure, resulting in one of the least expensive and quickest means of rapidly generating new renewable energy, reducing fossil fuel use, and lowering greenhouse gas emissions.  Learn more...

Wednesday, March 4, 2009
2:00 – 3:30 p.m.
SVC 212/210 Capitol Visitor Center
Washington D.C.

The Visitor Center entrance is on the East side of the U.S. Capitol Building.
Staff will escort briefing attendees to SVC 212/210.

For more information, go to:  http://eesi.org/030409_forest_biomass

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Feature Article

Ethanol Industry Losses Mount.  What Will Washington Do?

By Ned Stowe, Policy Associate
EESI Sustainable Biomass and Energy Program

With the recent sharp drop in gasoline demand and prices and the global economic meltdown, the ethanol industry is facing hard times.  Profit margins have fallen into negative territory as corn prices have remained relatively high and the price of oil has plunged through the floor.  Ethanol-blended fuel used to be cheaper than gasoline, but in January, gasoline was cheaper in some places.  Credit and investment sources have dried up.  Many producers are in serious financial trouble, with the second largest producer, VeraSun Energy Corp., filing for bankruptcy.  At the end of January, Archer Daniels Midland reported that more than a fifth of the U.S. ethanol production capacity had been idled.   Tens of thousands of jobs and the economic well being of rural communities across the country are at risk as the industry endures the economic storm. 

Back here in Washington, many are wondering what, if anything, the federal government should do to salvage the still fledgling industry.  Congress more or less created the industry in 2005 by setting renewable fuel production levels in the Energy Policy Act, and then it applied a legislative accelerator in 2007 with the Energy Independence and Security Act, which set even higher renewable fuel mandates.  Under current law, fuel blenders are still required to blend steadily increasing amounts of renewable fuels into the nation’s fuels (11.1 billion gallons in 2009 - up from 9 billion in 2008); they receive a $0.45 federal tax credit for each gallon of ethanol they blend; and there are many other federal and state incentives, mandates, and subsidies to support the industry and expand its infrastructure.  But apparently, these policies still are not enough to sustain the industry.   

What should Congress and the Administration do? 

Some environmental critics say “do nothing”.  Let the industry collapse.  Congress never should have created this industry in the first place.  Corn-based ethanol is worse than gasoline, in their view.  Diverting U.S. farmland from food and feed to fuel production drives tropical deforestation overseas, as global agricultural producers adjust to meet rising global food, feed, and fuel demand.  Deforestation releases vast amounts of stored carbon to the atmosphere.  On top of that, corn-based ethanol production uses too much fossil energy and water, pollutes the air and water, and endangers public health.   Better to shift the billions in annual subsidies to other, more environmentally sound, renewable energy development.  On top of this, food processors and livestock producers say the diversion of farmland to fuel production is driving up global food prices and causing food shortages.

Yet the industry’s defenders say “not so fast.”  More careful analysis indicates that many of these charges against the industry are overstated and the benefits of ethanol production are understated.  The newest corn-based ethanol refineries are much more energy- and water-efficient and less carbon-intensive than older refineries.  Many other factors were already driving tropical deforestation before U.S. corn-based ethanol production accelerated, and all of those factors are still at work today.  The scientific community is only just beginning to investigate and debate over how much (if any) land use change in other countries (and associated carbon emissions) should be attributed to U.S. domestic ethanol production and over how much net carbon is actually emitted over the long-term due to land use changes and subsequent agricultural land use practices.  Further, often overlooked is the fact that using feed corn for ethanol is not a zero-sum game with respect to food production; a commercially valuable co-product of corn-based ethanol production is protein-rich livestock feed (dried distillers grains), which is sold to both domestic and overseas livestock producers.

Other factors have contributed much more to the alarming rise of hunger and food insecurity.  The global population continues to grow rapidly – 80 million per year – as does the global demand for grain-intensive meat.  China, once agriculturally self-sufficient, now imports globally significant amounts of food and feed.  Crop failures have occurred around the world recently, due to extreme weather events.  In 2008, fertilizer shortages, market speculation, and grain hoarding by national governments accelerated the increase in global food prices. 

Despite these continuing debates, however, it seems Congress and the White House have already decided to “do something.”  Political momentum to support the biofuels industry remains strong.  A quarter million jobs are at stake, as is the national commitment to reducing oil dependence and greenhouse gas emissions.  President Obama supported biofuels in his campaign; the new secretaries of Agriculture and Energy are strong supporters; and the industry still has many friends in Congress.  In the recently enacted economic recovery bill, $800 million was allocated for bioenergy research, development, demonstration, and deployment; incentives were increased for fuel distributors to add E-85 pumps; and additional loan guarantees will be made available to help finance advanced biorefineries.

This is just the beginning.  Congress and the Administration will have to resolve a number of other related issues in the months ahead.

  • How will EPA implement the Renewable Fuel Standard (RFS)?  Will EPA attribute carbon emissions from tropical deforestation to corn-based ethanol production in the U.S. as it computes the life-cycle carbon-intensity of biofuels as the RFS legislation requires?  Or will Congress revisit the RFS and change the directive to EPA?  The EPA public comment period has ended; a decision is expected soon; and, Congress has stated its intent to revisit this issue. 
  • Will the USDA approve fielding a new genetically engineered ethanol corn strain that is designed to produce more ethanol per bushel and require less energy and water to process?  Food safety experts are concerned about how it may interbreed with and affect food and feed corn.  The public comment period has ended.  A decision is imminent.
  • Will EPA increase the ethanol fuel blend ratio above the current 10 percent maximum?  The industry will soon reach a “blend wall” at which point the market for the 10 percent ethanol blend will be saturated – even though the law mandates continued increases in ethanol production beyond that saturation point.  Producers will have no place to sell the additional ethanol.  DOE and EPA are studying whether increasing the fuel blend to 13, 15 or 20 percent will harm engines or increase vehicle emissions.  The studies are expected to be completed soon.  The ethanol industry is lobbying for an increase.  Tom Vilsack, the new head of the USDA, has asked Lisa Jackson, the new head of the EPA, to consider it, and Senator Jeff Bingaman (D-NM), chair of the Energy and Natural Resources Committee, reportedly is considering it.  
  • Will Congress fully fund the bioenergy programs recently authorized in the 2008 farm bill?  Up to $1 billion in mandatory funding over five years was approved, and another $1 billion in discretionary funding was authorized for programs to diversify and develop biofuel feedstocks, bio-based products, biorefineries, and rural renewable energy systems.  The FY09 appropriations for agriculture and energy need to be completed by March 6, and the FY10 budget and appropriations cycle is starting.
  • Will Congress increase the tax on petroleum-based fuels to create a market in which biofuels will be competitive with cheap oil?  Senator Richard Lugar (R-IN) thinks this is the way to go.  He advocates a revenue neutral approach whereby the increased gasoline tax would be off-set by a reduction in payroll taxes.  This is perhaps the most powerful, efficient, and effective way to promote the development of advanced biofuels.  Taxing the carbon content of fossil fuels more broadly or establishing a cap and trade program for greenhouse gas emissions could have a similar effect.  These approaches are likely to be debated this spring as Congress works on new energy and climate legislation. 

In the meantime, the industry is reorganizing.  Valero, the oil refiner, is buying up bankrupt Verasun’s idled assets.   Poet, the leading ethanol producer of corn-based ethanol, has started production of advanced biofuel at a pilot-plant in South Dakota, using corn cobs as the feedstock, and it is planning to begin commercial-scale production at a new plant in Iowa by 2011.  Verenium has opened a demonstration-scale plant in Louisiana that produces cellulosic biofuel from sugar cane stalks, and, with a recent infusion of capital from BP, will soon begin construction of a commercial-scale plant in Florida.  Range Fuels has received an $80 million loan guarantee from the federal government to build a commercial-scale cellulosic ethanol plant in Georgia.  Continental Airlines recently tested using advanced biofuel made from jatropha and algae in one of its aircraft.  The industry is down, but not out.

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Federal Initiatives Updates

New Legislation

H.R. 260
On January 6, Rep. Sheila Jackson-Lee (D-TX) introduced H.R. 260 to authorize the Secretary of Energy to make loan guarantees for cellulosic ethanol production technology development. The bill was referred to the Committee on Energy and Commerce and the Committee on Science and Technology.

H.R. 392

On January 9, Rep. Roy Blunt (R-MO) introduced H.R. 392 to amend the Clean Air Act to provide for a reduction in the number of boutique fuels, and for other purposes.  The bill was referred to the Committee on Energy and Commerce.

S. 223
On January 13, Senator Russ Feingold (D-WI) introduced S. 223 to amend the Farm Security and Rural Investment Act of 2002 to further the adoption of technologies developed by the Department of Agriculture and to encourage small business partnerships in the development of energy through biorefineries.  The bill was referred to the Committee on Agriculture, Nutrition, and Forestry.

S. 290

On January 21, Senator James Inhofe (R-OK) introduced S. 290 to amend the Energy Independence and Security Act of 2007 to repeal provisions prohibiting any federal agency from entering into a contract for procurement of an alternative or synthetic fuel for any mobility-related use, other than for research or testing, unless the contract specifies that the lifecycle greenhouse gas emissions associated with the production and combustion of the fuel must be less than or equal to such emissions from the equivalent conventional fuel..  The bill was referred to the Committee on Energy and Natural Resources.

H.R. 622
On January 21, Rep. Mike Michaud (D-ME), Rep. Todd Platts (R-PA), and Rep. Barton Gordon (D-TN) introduced H.R. 622  to amend the Internal Revenue Code of 1986 to expand the credit for renewable electricity production to include electricity produced from biomass for on-site use.  The bill was referred to the Committee on Ways and Means.

S. 306

On January 22, Senator Ben Nelson (D-NE), Senator Mike Crapo(R-ID),  Senator Ron Wyden(D-OR), Senator John Thune(R-SD), Senator Sherrod Brown (D-OH), Senator Mike Johanns (R-NE), Senator Debbie Stabenow (D-MI) introduced  S. 306  to promote biogas production.  The bill was referred to the Committee on Finance.

 

New Agriculture Secretary Strong Backer of Biofuels

The new Secretary of Agriculture, Tom Vilsack, said he will promote renewable energy and aggressively pursue new ways to produce biofuels.  Vilsack, the former Governor of Iowa, has long been a proponent of ethanol production, and Iowa has been at the epicenter of corn-based ethanol production.  Only days after being sworn in, Vilsack told reporters, "We need to make sure that the biofuels industry has the necessary support to survive the recent downturn.”  The new USDA secretary was referring to the string of bankruptcies and financial hardships that ethanol plants have experienced due to the volatility in corn and petroleum prices and decreased demand for ethanol. Some lawmakers expressed concern that Vilsak will favor aid for corn-based ethanol producers.  Vilsack said he supports all renewable energy and cellulose-based ethanol.   “It’s important for us to realize it’s not just corn, and not just the Midwest, that can benefit.”   As head of USDA, Vilsack will be charged with implementing the 2008 Farm Bill, which includes a variety of programs to support the development of renewable biofuels.  Vilsack is encouraging the EPA to raise the ethanol blend rate in gasoline above the current 10% level, which would increase demand for ethanol.  The EPA and the Department of Energy are currently studying how this would affect engine performance and emissions.

Sources:  http://www.nytimes.com/2009/01/15/us/politics/15vilsack.html?ref=earth
http://www.reuters.com/article/marketsNews/idUSN2638461920090126
http://www.worldwatch.org/node/6017
http://uk.reuters.com/article/oilRpt/idUKN1029043720090210?sp=true

 

USDA Approves First Loan Guarantee for Commercial-Scale Cellulosic Ethanol Plant

On January 16,  cellulosic ethanol start-up Range Fuels announced it has secured a conditional $80 million loan guarantee from the USDA to finish its commercial-scale biorefinery in Soperton, Ga.  The loan guarantee is being provided through the Biorefinery Assistance Program, Section 9003 of the 2008 Farm Bill.   The Program is intended to promote the development of commercial-scale production of advanced biofuels, create renewable energy-related jobs, and increase economic development in rural America.   Under the program, companies can apply for loan guarantees of up to $250 million per project.  The Range Fuels plant is expected to be fully operational in 2010 and produce 20 million gallons of cellulosic ethanol per year.  Eventually, the plant is expected to produce 100 million gallons per year. 

Sources: http://earth2tech.com/2009/01/19/range-fuels-clinches-80m-usda-loan-guarantee/

http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB?contentidonly=true&contentid=2009/01/0024.xml

 

DARPA Contract Awarded to Develop Jet Biofuel from Algae

On January 26, the Defense Advanced Research Projects Agency (DARPA) awarded Science Applications International Corp. (SAIC) a contract to help develop an alternative to petroleum-based jet fuel from agricultural and aquacultural feedstocks.  The contract is worth up to $25 million if all phases are completed.  The agency’s BioFuels Program is trying to reduce the military’s dependence on traditional fuels by exploring alternative fuels and fuel efficiency measures.  Under the contact, SAIC will lead a team of academic and industrial organizations to develop an alternative to jet fuel from algae at a cost target of $3 per gallon.

Sources: http://investors.saic.com/releasedetail.cfm?ReleaseID=361309
http://www.forbes.com/feeds/ap/2009/01/26/ap5964115.html
http://www.darpa.mil/sto/chembio/biofuels.html

 

National Science Foundation Grant

The Energy for Sustainability program supports fundamental research and education in energy production, conversion, and storage and is focused on energy sources that are environmentally friendly and renewable, such as solar, wind, and biomass. The duration of unsolicited awards is generally one to three years.  The average annual award size for the program is $100,000.  Any proposal received outside the announced dates will be returned without review.  The duration of CAREER awards is five years.  The submission deadline for Engineering CAREER proposals is in July every year.  Please see the following URL for more information: http://www.nsf.gov/pubs/2005/nsf05027/nsf05027.jsp

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State Initiatives Updates

New Hampshire Regulates Wood Boiler Emissions

In an effort to reduce harmful emissions, New Hampshire has toughened emissions standards for wood boilers.   As of January 1, all new wood boilers, which usually burn small wood pellets, will be marked with either an orange or white tag, which signifies the environmental friendliness of the boiler.   The orange and white tags represent an emissions reduction of 70 percent and 90 percent, respectively.   In 2010, only boilers with a white tag will be available to consumers.  New Hampshire, which has 2,000 wood boilers operating throughout the state, is only the third state to team up with the EPA and regulate the outdoor furnaces.  State Senator Maggie Hassan (D-Exeter), a sponsor of the bill, believes it is not only environmentally friendly but will improve the health of her constituents.  "I had constituents who were adversely affected by a neighbor's boiler," she said.   The law does not apply to boilers installed before January 1. 

Source:  http://www.timberbuysell.com/Community/DisplayNews.asp?id=4028

 

Michigan Tax Credit for Gas Stations that Sell E85

On December 30, 2008, the Michigan legislature approved a tax credit of 30 percent (up to $20,000) for fuel station owners who install new E85 or biodiesel pumps. Up to $1 million will be distributed to qualified owners from January 1, 2009 to December 31, 2012.  Lawmakers hope the new law, combined with federal incentives, will increase the number of E85 and biodiesel stations.  There are currently 92 E85 stations throughout the state.

Source: http://domesticfuel.com/2009/01/08/incentive-now-available-in-mi-for-e85-and-biodiesel-infrastructure/

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Research and Technology Updates

Study Finds Biofuel Carbon Footprint Overstated

A newly-released study from Michigan State University finds that the life-cycle greenhouse gas emissions due to indirect land use changes attributed to biofuels production may be significantly less than earlier studies have indicated.  The researchers found that the carbon “pay back” time – the theoretical amount of time it takes for the carbon savings of biofuel production to surpass the carbon emissions from indirect land use changes attributed to biofuels production – can be significantly shorter depending on how the land is cultivated after the grasslands or forests have been converted to agriculture.  Rather than the 100 to 1000 years that previous studies estimated, based on worst case assumptions about land stewardship practices, the researchers found that the pay back time could be as short as three years for grasslands and 14 years for forests, when best land management practices are applied.   The study also critically examines whether life-cycle greenhouse gas emissions attributed in previous studies to indirect land use change can be objectively measured and whether the carbon costs of indirect land use change are an appropriate and fair standard to apply to the production of biofuels in the U.S.  No other industry in the U.S. is required to meet such a standard.  

Sources: Kim et al. Biofuels, Land Use Change, and Greenhouse Gas Emissions: Some Unexplored Variables. Environmental Science & Technology, 2009.  Available for a fee at http://pubs.acs.org/doi/full/10.1021/es802681k
 http://www.physorg.com/news151257863.html

 

Research Finds Ethanol Production Is More Efficient with Fewer Emissions

A report published in Yale’s Journal of Industrial Ecology finds corn-ethanol systems have a far greater potential to reduce GHG emissions and U.S. dependence on foreign oil for transportation fuels than prior studies have suggested.  The report, Improvements in Life Cycle Energy Efficiency and Greenhouse Gas Emissions of Corn-Ethanol , was a project of the University of Nebraska-Lincoln’s Nebraska Center for Energy Sciences Research.   New technologies that improve energy efficiency at bio-refineries, environmentally friendly soil management, and co-product utilization are listed as major factors for the lower emissions rate.  The study found “direct effect GHG emissions were estimated to be equivalent to a 48% to 59% reduction compared to gasoline, a two-fold to three- fold greater reduction than reported in previous studies.” 

Source: http://domesticfuel.com/2009/01/22/report-shows-efficiency-of-ethanol-production/

 

Researchers Study Ethanol, Biomass Fuel Cell Technologies

Fuel cell expert Sossina Haile and a research team at the California Institute of Technology are exploring the use of biomass or ethanol as a primary fuel in fuel cells instead of hydrogen.  Hydrogen is difficult to store and distribute and requires a great amount of energy to extract.  Fuel cells produce energy from electrochemical reactions with fewer emissions and greater efficiency than internal combustion engines.  Haile and her team have patented their new technologies and founded the company Superprotonic Inc.  

In a separate project, a team of scientists from the U.S. Department of Energy’s (DOE) Brookhaven National Laboratory has developed a new catalyst that could make ethanol-powered fuel cells a real possibility, according to a press release from the Lab.  Researchers found an electro-catalyst capable of breaking down ethanol’s carbon atom bonds at room temperature.  The new catalyst may make ethanol the perfect reactant for fuel cells, said Brookhaven chemist Radoslav Adzic. “[Ethanol] is easy to produce, renewable, nontoxic, relatively easy to transport, and it has a high energy density. In addition, with some alterations, we could reuse the infrastructure that’s currently in place to store and distribute gasoline.”  Their findings are published online in the January 25, 2009 edition of Nature Materials.

Sources: http://nazret.com/blog/index.php?title=ethiopia_researcher_seeks_to_put_fuel_ce&more=1&c=1&tb=1&pb=1

http://www.bnl.gov/bnlweb/pubaf/pr/PR_display.asp?prID=898
http://www.nature.com/nmat/journal/vaop/ncurrent/pdf/nmat2359.pdf (pdf)

 

UCLA Scientists Create New, Highly Efficient E. Coli-based Fuel

Scientists from the University of California in Los Angeles have announced they have discovered a way to turn E. coli bacteria into an alcohol fuel with at least twice the energy content of ethanol.  The research team created a strain of the bacteria that generates alcohol with more than twice the number of carbon atoms per molecule as regular ethanol.  The larger, long-chain molecules from the altered E. coli strain contain more energy and produce less greenhouse gas emissions.  The scientists believe they will soon be able to engineer a strand of the bacteria which generates eight carbon atoms per alcohol molecule and therefore contains more energy. 

Source: http://www.enn.com/energy/article/39036

 

Report Recommends Bioenergy to Fight Climate Change and Energy Poverty

In a report  to be released later this year, the German Advisory Council on Global Change (WBGU) will outline the medium-term potential for sustainable global bioenergy and how it should be exploited while managing the risks.  The report, entitled Future Bioenergy and Sustainable Land Use, finds bioenergy can help mitigate climate change and contribute to solving energy poverty in developing nations, but warns that care must be taken to protect the environment, to avoid undermining climate change mitigation efforts, and to assure food security.   WBGU recommends using bioenergy mainly for generating electricity, converting existing coal-fired power plants into co-firing plants that use a combination of coal and biomass feedstock.  However, WBGU warns against growing energy crops on agricultural lands to produce liquid biofuels for the transportation sector.  The study finds that “modernization of traditional bioenergy use can reduce poverty, prevent damage to health and diminish pressures placed on natural ecosystems by human uses.”  

Sources:  http://www.wbgu.de/wbgu_jg2008_kurz_engl.html
http://www.worldofrenewables.com/index.php?do=viewarticle&artid=2883&title=bioenergy-has-the-potential-to-sustainably-meet-around-10-of-the-worlds-medium-term-energy-requirement

 

Korean Scientists Extract Useful Chemicals from Biodiesel By-Products

South Korean scientists have developed a new process to extract commercially valuable chemicals as by-products of the production of biodiesel fuel.  The new process will help improve the profitability of biodiesel production by about 15%.  Researchers estimate that, when large-scale biodiesel production begins in 2012, manufacturers will annually extract 950,000 tons of glycerol carbonate (worth more than $50 million USD) and 3.6 million tons of 3-hydroxypropionic acid (worth as much as $3.5 billion) as by-products which can be used in various industrial and medical applications.

Sources: http://www.tradingmarkets.com/.site/news/Stock%20News/2111176/
http://www.msnbc.msn.com/id/28528290/

 

Cornell Scientists Find New Method to Make Cleaner Biogas

Scientists from Cornell University have invented a process that uses manure and farm byproducts to remove hydrogen sulfide from biogas.  Biogas is created from animal waste through anaerobic digestion, a process that produces carbon dioxide, methane, and hydrogen sulfide.  Hydrogen sulfide is a toxic gas that can be fatal at levels of high concentration.  Harry and Terry Spittler, who founded the company Terrenew, are marketing the removal method under the name SulfaMaster.  Their method is the first practical solution for removing the gas for small-scale farms and operations.  It uses animal manure as a major component of a special medium that is placed in large barrels.  “The gas is then piped into the bottom of barrels, passes through the medium, the hydro sulfide is removed,” explains Harman.  “The resulting clean methane can then be used for energy.”  Terrenew is exploring the possible application of SulfaMaster or a similar process to capture biogas produced in sewage treatment plants or landfills which could be used to produce on-site electricity.   In related news,  on January 22, Senators Ben Nelson (D-NE), Mike Crapo(R-ID),  Ron Wyden(D-OR), John Thune(R-SD), Sherrod Brown (D-OH), Mike Johanns (R-NE), Debbie Stabenow (D-MI) recently introduced  S. 306  to promote biogas production. 

Source:  http://www.enn.com/energy/article/39043

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News Briefs

Company Plans to Use Termite Microbes to Make Ethanol

The Colorado-based company ZeaChem plans to make ethanol from termite-derived micro-organisms.  The company, which announced in early January that it has raised $34 million to build its first plant, estimates it will produce 1.5 million gallons of cellulosic ethanol per year from wood chips and grasses.   Using existing equipment, the company has developed a process that uses microbes found in termites to make ethanol.  The biorefinery will be equipped to handle a number of different kinds of biomass, but poplar trees will be the main feedstock source, as they grow quickly and are easily harvested.  The company claims its process can produce 40 percent more ethanol per ton of biomass than other production processes. 

Sources: http://news.cnet.com/8301-11128_3-10134766-54.html
http://www.timberbuysell.com/Community/DisplayNews.asp?id=4120

 

Biofuel Blends Tested in Airplanes

Air New Zealand recently completed a successful test flight of a Boeing 747 powered in part by a jatropha-based biofuel.  The two-hour flight used a 50:50 blend of jatropha-based fuel and conventional jet fuel to power one of its four engines.   It was the first commercial plane to use an ethanol blend.  Biofuels could eventually be an alternative to conventional jet fuel and reduce greenhouse gas emissions.  Jatropha can be grown in arid environments where it can be difficult to grow food crops, and produces oil rich seeds.  The jatropha used in this experiment was grown in Malawi, Mozambique, Tanzania and India.  Continental Airlines also completed a two-hour test flight at Houston, Texas.  It was the first flight in North America to use biofuel, the first ever test flight on a two-engine plane, and the first to use a biofuel produced in part from algae.  The airline says initial reports show that the flight, which included engine restarts, aggressive accelerations and other maneuvers designed to test the engine, was successful.  One of two CFM engines on the Boeing 737 used a biofuel blend composed of 50 percent Jet A fuel, 47 percent jatropha ethanol and 3 percent algae-based ethanol.  The airlines are looking for a renewable fuel that both reduces carbon emissions and has a more predictable and stable price than oil. 

Sources: http://greeninc.blogs.nytimes.com/2008/12/30/air-new-zealand-flies-on-engine-with-jatropha-biofuel-blend/?hp
http://www.greenbiz.com/news/2009/01/05/air-new-zealand-completes-biofuel-test
http://biofuelsdigest.com/blog2/2009/01/08/continental-airlines-tests-aviation-biofuel-first-use-of-algae-first-us-biofuel-test-flight-first-two-engine-flight/
http://www.nytimes.com/2009/01/07/business/07jetfuel.html?_r=1&scp=2&sq=continental%20airlines%20biofuel&st=cse

 

Ethanol Sales Top Gasoline in Brazil

According to the newswire service AFP, the National Petroleum Agency reported that ethanol sales outpaced gasoline in Brazil for the first time.  The article said the report took into account only hydrated ethanol that can be used in its pure form in most cars, and not anhydrous ethanol that is used to blend with gasoline.  Sales of hydrated ethanol through October increased 44.9 percent from the previous year to reach 4.2 billion gallons.  Brazil, which produces its ethanol from sugar cane, is the world’s second leading producer of ethanol after the United States.   About 90 percent of cars in Brazil can run on ethanol or an ethanol-gasoline blend.  Priced at about .63 cents a liter USD, ethanol is nearly .44 cents cheaper per liter than gasoline. 

Sources: http://www.google.com/hostednews/afp/article/ALeqM5iVs6-yJ30ZuuVAzb-Mpi9DWUuz4Q

 

Popularity of Pellet Stoves Spurs Innovation

The sale of pellet stoves continues to rise despite the faltering economy – driven in large part by the soaring price of heating oil contracts through the summer of 2008.   Shipments through the first six months of 2008 were up 135 percent over 2007, according to the Hearth, Patio & Barbecue Association.  The majority of the 800,000 pellet stoves were sold in New England.   The popular stoves burn small pellets made of sawdust left over from timber and furniture production, as well as corn, wheat, and other biomass feedstocks.   The pellets have traditionally been sold at local retailers and home centers in packages that weigh 40-50lbs.  The package must then be transported back to the location of the stove and dumped into an opening.  This labor intensive process gave entrepreneur Jon Strimling, founder of PelletSales.com in Goffstown, New Hampshire, the idea of creating a bulk delivery system.    His company sells a hopper that, once filled with pellets delivered by truck, eliminates the need for a stove owner to worry about tending to the stove except for removing pellet ashes every other week or so.   The pellets are cheaper to purchase in bulk, but the hopper runs anywhere from $1,000 to $5,000.  Federal legislation provides a $300 tax credit for stoves purchased after January 1, 2009.

Source: http://www.timberbuysell.com/Community/DisplayNews.asp?id=4025

 

Unlikely Coalition Urges More Ethanol Testing

The National Petrochemical and Refiners Association, which represents the oil-based plastics and gasoline refineries, has teamed up with the Sierra Club, the Natural Resources Defense Council, and 11 other groups to oppose an attempt by the ethanol industry to increase the percentage of ethanol allowed to be blended with gasoline.  The ethanol industry is asking the EPA to allow ethanol blends higher than the current  ten percent limit.  Producers are concerned that the market for ethanol will soon be saturated at the ten percent blending limit, even though the federal renewable fuel standard mandates steadily rising ethanol production.  When the market hits the ten percent “blend wall”, they wonder who will buy the additional mandated product.  Ethanol proponents argue blend limits can be increased to 15 percent or perhaps 30 percent without damaging conventional vehicle engines or the environment.  The new head of the USDA is encouraging the EPA to raise the ethanol blend rate, as well.  The coalition opposing the change in regulation argues more testing is needed.  The EPA and the Department of Energy are currently studying how this would affect engine performance and emissions. 

Sources: http://www.desmoinesregister.com/article/20081228/BUSINESS/812280317/-1/NEWS04
http://renewablefuelsassociation.cmail1.com/T/ViewEmail/y/65EC5F052697B653/06FE2973C5F2D
http://www.worldwatch.org/node/6017
http://uk.reuters.com/article/oilRpt/idUKN1029043720090210?sp=true

 

Cooking Oil Reused to Help Power Restaurant

Recycled restaurant cooking oil is now providing about ten percent of electric power and hot water needs to a seafood restaurant in Dedham, Massachusetts.  The newly-installed Vegawatt generator uses 80 gallons of waste oil from the deep fryer per month to generate five kilowatts of power plus hot water.  At current electricity rates, one gallon of used oil offsets $2.50 worth of electricity costs.  The founder of Vegawatt, James Peret, estimates the $22,000 generator can save a restaurant $1000 per month and thus be paid off within two years.  Peret saw an opportunity to use a technology that has existed for decades but has only been utilized in automobiles by a small number of consumers.  The Vegawatt is appealing as a renewable energy system because it captures both heat and power from renewable fuel combustion, recycles a resource that would otherwise have been discarded, and reduces demand for electricity and gas from the grid.    

Source: http://blog.wired.com/wiredscience/2009/01/vegawatt.html

 

Company to Deliver Metered, Thermal Energy from Wood Pellets

International Wood Fuels has entered the New England wood pellet business with big expectations. Steven Mueller’s company is offering to install free wood pellet boilers in Maine businesses, schools, and other commercial spaces.  He’s hoping his company can gain market share by offering free installation and maintenance of boilers and free delivery of pellets.  In return, customers agree to enter a ten-year contract to buy heat, which is measured with a meter, the same way gas and electric utilities do.  The annually adjusted rates are guaranteed to be less than oil unless oil falls below a predetermined base price.  This year, for example, the price floor is $2 per gallon.  Mueller, and the wood pellet industry as a whole, are betting oil prices will rise again.

Source: http://pressherald.mainetoday.com/story.php?id=232102&ac=PHbiz&pg=1

 

First Demonstration-Scale Cellulosic Ethanol Plant in U.S. Opens

Verenium, a company specializing in the development of cellulosic ethanol and specialty enzymes, has begun production of second generation cellulosic ethanol at its biorefinery in Jennings, Louisiana.  The facility is the first cellulosic ethanol demonstration-scale plant in the U.S.  Unlike conventional ethanol refineries which make ethanol from corn, the Verenium plant produces cellulosic ethanol from crushed sugar-cane stalks.  The refinery expects to produce 1.4 million gallons of cellulosic ethanol per year.  This amount is considerably less than the 60 million gallons a year produced at a standard corn ethanol facility, but far greater than any cellulosic pilot program has yet produced.  

Sources: http://www.usatoday.com/money/industries/energy/2009-01-08-cellulosic-waste-ethanol_N.htm
http://gas2.org/2009/01/09/first-cellulosic-ethanol-plant-in-usa-up-and-running/
http://www.verenium.com/about.asp

 

U.S. Ethanol Giant Opens Cellulosic Ethanol Pilot-Scale Plant

On January 12, 2009, the leading U.S. ethanol producer, Poet, announced the opening of an $8 million pilot plant that will produce cellulosic ethanol from corn cobs and other crop residue.  Initially, the plant will produce 20,000 gallons of the low-carbon fuel per year.  The pilot project is expected to help the company prepare for the $200 million commercial-scale cellulosic plant it plans to open in 2011 in Emmetsburg, Iowa.  Poet is one of a number of companies trying to figure out a way to produce cellulosic ethanol at a price that is competitive with corn-based ethanol and gasoline. Federal mandates require 100 million gallons of cellulosic ethanol to be blended into the gasoline pool each year by 2010, and at least 16 billion gallons per year by 2022.   Poet plans eventually to make cellulosic ethanol at all of its 26 plants, which currently produce 1.5 billion gallons of ethanol per year.  The collection, storage and processing of corn stover are key challenges.   Recent research, development, and demonstration projects by Poet, USDA, and others hold promise.

Sources:  http://uk.reuters.com/article/email/idUKTRE50B6ZF20090112?sp=true
http://domesticfuel.com/2008/11/06/poet-wants-liberty-from-foreign-oil/
http://ethanolproducer.com/article.jsp?article_id=5271
http://southeastfarmpress.com/biofuels/biofuels-research-1106/

 

Converted Coal to Biomass Plant Cuts Costs, Emissions

The Savannah River Site National Lab, Aiken, S.C., which last year converted a coal-fired power plant to a biomass-fired plant, estimates it will save $1.5 million annually by burning wood instead of coal.  The $10 million project converted one of two generators at the 1950’s era plant into a biomass-fired generator.   The state-of-the-art biomass generator burns wood chips and tree residue, some of which comes from US Forest Service timber operations at the site.  The plant is powered by 22,000 tons of wood chips per year, replacing the 12,000 tons of coal previously used to power the facility.  Wood chips and timber residue are considerably cheaper than coal in the heavily wooded Southeast.   The savings will enable the plant to pay for the new facility within ten years.  The wood chips produce significantly fewer greenhouse gases and other air pollutants.  The new plant meets Clean Air and Water Act standards. 

Source: http://www.timberbuysell.com/Community/DisplayNews.asp?id=4122
http://machinedesign.com/article/biomass-helps-power-national-lab-0108

 

Alabama Power Considering Switch to Wood

Alabama Power Co., a subsidiary of Atlanta-based Southern Company, is studying the option of generating more electricity from wood and biomass.  The company currently cofires wood chips and switchgrass at some of its coal-powered plants, but does not have any generating units that use only biomass.  The leading power provider in the state is considering converting a coal-burning unit at one of its facilities to a biomass unit capable of generating 70 to 80 megawatts, enough to light thousands of homes.  According to estimates by the city of Mobile, the plant would burn 700,000 to 800,000 tons of biomass annually.  Most of the biomass would be from pruned tree limbs and other local “waste material.”   

Source: http://www.al.com/news/press-register/metro.ssf?/base/news/123184173328340.xml&coll=3

 

Green Jobs Report Forecasts Up to 37 Million U.S. Green Jobs By 2030

The economic impact from changing federal and state renewable energy (RE) and energy efficiency (EE) policies could be enormous, according to a report by American Solar Energy Society (ASES) and Management Information Services, Inc (MISI).  In 2007, the RE and EE industries supported over 9 million jobs and generated more than $1.0 trillion in revenue.  More than half of the renewable energy produced in the U.S. in 2007 was from biomass. Over 70 percent of RE jobs were in the biomass sector—primarily in ethanol and biomass power.  Biomass power accounted for 41 percent of total revenue and 31 percent of total RE jobs whereas ethanol accounted for 20 percent of RE revenues and 39 percent of jobs.  The report examined three scenarios for the future of the RE and EE industries. In the advanced case, which would "push the envelope" of developing technologies and include aggressive policy initiatives at both the federal and state levels, the green economy would support 37 million jobs and $4.3 trillion in revenue by 2030.  The base case, which represents the business as usual scenario, would provide only about 16 million jobs and less than $2.0 trillion in revenue by 2030.  Many of the new jobs and revenue would be in the biomass industry.  In fact, the paper notes, “the largest differentials [between the advanced and base scenario] in terms of jobs created are in the ethanol, biomass power, and wind sectors.”

Sources: http://www.ases.org/index.php?option=com_content&view=article&id=465&Itemid=58
http://www.ases.org/images/stories/ASES/pdfs/CO_Jobs_Final_Report_December2008.pdf (pdf format)
 

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Upcoming Events

 

Electric Transmission 102: Policy Challenges to Grid Expansion (EESI Briefing) (Feb. 27) Washington, DC Belgium http://eesi.org/022709_transmission

U.S. Jobs and a Low-Carbon Supply Chain (EESI Briefing) (Mar. 2) Washington, DC http://eesi.org/030209_green_jobs

Global Sustainable Feedstock, Biofuel & Biochemical Summit (SFBB) (Mar. 3-6) Kuala Lumpur, Malasia http://www.neo-edge.com/events/ event.php?fld=eu&page=eu_17

Renewable Energy World Conference & Expo North America (Mar. 10-12) Las Vegas, NV http://rewna09.events.pennnet.com/fl/index.cfm

World Biofuels Markets Congress & Exhibition (Mar. 16-19) Brussels, Belgium http://www.worldbiofuelsmarkets.com/

Biomass 2009: Fueling Our Future (Mar. 17-18) National Harbor, MD http://biomass2009.com/

BioPower Generation Asia (Mar. 25-126) Singapore, Singapore http://www.greenpowerconferences.com/biofuelsmarkets

Ethanol 2009: Emerging Issues Forum (Apr. 2-3) Omaga, NE http://www.ne-ethanol.org/forum2009/

OPIS Energy Fuel Policy and Supply Summit (Apr. 5-7) Washington, DC http://www.opisnet.com/altfuels/index.html

Alternative Fuels and Vehicles National Conference and Expo (Apr. 19-22) Orlando, FL http://www.afv2009.com/

Advanced Biofuels Development Summi (Apr. 20-21) Washington, DC http://www.biofuels-summit.com/

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Writers: Jamie Donovan, Ned Stowe
Editors: Ned Stowe, Ellen Vaughan

Please distribute BCO to your colleagues or send us their e-mail addresses and we will add them to our distribution list. Article and commentary submissions are encouraged and should be sent via email.

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The Environmental and Energy Study Institute (EESI) is a non-profit organization that works at the nexus of policy and innovation to promote environmentally sustainable societies. EESI was founded in 1984 by a bipartisan group of Congressional Members dedicated to finding environmental and energy solutions. EESI provides credible, timely information and innovative policy ideas through coalition building, media outreach, publications, briefings, workshops and task forces on the issues of energy efficiency and renewable energy, transportation, smart growth, agriculture and global climate change. Carol Werner leads the EESI team as executive director.

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BCO 55 - February 2009

In This Edition

 

EESI Announcements

Feature Article

Federal Initiatives Updates

State Initiative Updates

Research and Technology Updates

News Briefs

Upcoming Events