AzoCleantech:
The amount of agricultural land required to produce 15 billion gallons of grain ethanol in the United States by 2015, as required by the 2007 Energy Independence and Security Act (EISA), is likely to be less than 1 percent of total world cropland, according to a new report released today by the Renewable Fuels Association. According to the report, “Understanding Land Use Change and U.S.

Ethanol Expansion,” gains in agricultural productivity, coupled with the contribution of feed produced as an ethanol co-product, are expected to significantly mitigate the need for conversion of non-agricultural lands to support expanded U.S. biofuels production.
Read the report here.

“Using unsupported assumptions, imprecise economic models, and questionable logic, some have suggested growth in U.S. biofuels like ethanol would indirectly cause significant conversion of forest and grassland to agriculture in the United States and abroad,” said the report. Moreover, there is no empirical evidence demonstrating land conversion abroad is a result of U.S. biofuels production. “Unfortunately, the current state of land use change science is far from conclusive and no consensus exists on how best to analyze the potential indirect land use impacts of expanding biofuels production,” continued the report.

In addition to examining projections from Informa Economics on future global agriculture land use, the RFA report cites studies and findings by the UN Food & Agriculture Organization, Oak Ridge National Laboratory, the U.S. Department of Agriculture and other researchers and research organizations. The report analyzes historical cropland and crop utilization trends, explores the complex and multifaceted nature of land use changes, and discusses the uncertainty of current land use change modeling approaches. More.

Butanol has traditionally been used as paint thinner, cleaner and adhesive, but as a fuel additive it contains more energy than ethanol and could be blended into existing cars at higher percentages.

And unlike ethanol, butanol does not eat away at pipes so it doesn’t need to be shipped by truck. That could help the nation meet its aggressive renewable fuels standard of 36 billion gallons of biofuels to be blended into gasoline by 2022, said Andy Aden, a research engineer at the National Renewable Energy Laboratory.

“Our existing infrastructure has too many bottlenecks and it’s just not going to cut it,” Aden said.

Chemical maker DuPont Co. and oil giant BP PLC are working on a pilot plant in the United Kingdom that will produce butanol from such feedstocks as wheat, corn, barley and rye. The two companies have also teamed with British Sugar to develop a commercial-scale ethanol plant that eventually would be converted to produce butanol once the process is perfected. Full post.

“This is the first ethanol factory in Cambodia and it will become the market place of cassava product for local farmers,” Prime Minister Hun Sen said at the opening ceremony of the pioneer venture invested by the MH Bio-energy Group of South Korea.

It will directly provide 192 job opportunities for local workers and encourage farmers to plant more cassava, he said, adding that the factory itself has made investment to grow cassava on 8,000 hectares of land in Kampong Speu province.

The project, with 40 million U.S. dollars of investment, has already opened two branches in Kampong Cham and Battambang provinces to purchase cassava from local farmers, he added.

Industry, Mines and Energy Minister Suy Sem said at the ceremony that the factory now has a designed capacity of 36,000 tons of ethanol fuel for export per year, especially to the European market.

“The factory has a plan to double its export volume during the next few years. It now needs about 100,000 tons of dry cassava flour each year,” he said, adding that its ethanol fuel can replace gasoline for vehicles.

By tapping plant waste, the laboratory hopes to end concerns that the use of food as feedstock would stop the pressure made by bioethanol production on food prices worldwide. The company said it hopes to have an answer by 2010, ahead of its rival Danisco.

Fungi such as mushroom and lichen produce enzymes which consume rotting logs and decaying leaves. Proteins are used by biofuel producers to break down complex carbohydrates in plant cells into a mixture of simple sugars that yeast could eat. Yeast ferments the mixture and produces ethanol. Enzymes available could not break down the tougher parts of plants effectively enough to bring down its cost of production. Full article.

The study should be disclosed at the opening of the international conference on biofuels “International Conference on Biofuels: Biofuels as a driving force of sustainable development”, to take place from the November 17 to 21.

“The study is going to show the areas for expansion of agriculture in the country, without including the Amazon, the Pantanal (wetlands in the west of the country), native Indian areas, forests, cities, etc.,” said, in an interview to foreign correspondents, ambassador André Amado, undersecretary general for Energy and Top-End Technology at the Itamaraty, who is responsible for the event.

According to him, the research is effectively going to reveal the areas to be used by several crops, including sugarcane for production of ethanol, without this implying in deforestation. The study shows land that is currently underused. “It will be a great advance in this area, as details are lacking,” he said.

According to figures disclosed by the ministry, the country has 65 million hectares available for the expansion of sugarcane, being 37 million now in grazing land. In early October, the minister of Agriculture of Brazil, Reinhold Stephanes, said that the cultivation of sugarcane should expand into these grazing grounds, which are well distributed throughout Brazil.

Stephanes added that over the next eight years, Brazil should need from four to five million hectares to double production of sugarcane. He also said that zoning is a system to generate compatibility between food and biofuel production and respect to the environment. Full article.

Consisting of two pieces of equipment — an ethanol boiler and the mini-refinery — the whole system can fit into an area of less than 30 square feet with 8 feet of clearance and is completely automated.

According to Adam Allard, President of Allard Research and Development, the EB120 ethanol boiler is their “core” product, acting as the “heart” of their systems. The AFS125 mini-refinery uses the boiler as part of its system, but the boiler and mini-refinery are sold separately.

As Allard says, “The boiler has a computer built-in, and that’s used for running boiler-specific tasks, as well as controlling the still. So although the boiler is sold also as a separate product, it would require an external distillation column, fermentation tanks, etc.”
The mini-refinery is computer touch screen controlled and features an Apple Mac Mini as its primary automation computer. When the boiler and the mini-refinery are used together, the Mac Mini also controls the boiler operation.

According to the Allard Research website, “The mini-refinery has 275, 60, 30, and 15-gallon tanks built in, and also comes with controls and ports for easy expansion to almost unlimited size. The computer includes built-in networking for both Ethernet and wireless 802.11. The system can be remotely controlled through the network, and multiple systems can be easily connected together to scale daily output capacity.” Read full post.

Obama and John McCain were both considered as having favorable policies toward cleantech, said Neal Dikeman, founding partner at Jane Capital Partners.

“With McCain or Obama, we’d have a president with some level of appreciation of clean technology,” Dikeman told the Cleantech Group. “There will be no long-term effect on energy policy with an Obama win because, quite frankly, they’re not that far apart.”

Dikeman said neither candidate took a strong-enough stance on energy independence. But some differences exist, Dikeman noted, including Obama’s longstanding support for corn-based ethanol.

Of the two candidates, Obama has also advocated a more-aggressive climate plan with a massive carbon-trading system, Dikeman said. It seemed unlikely late Tuesday (before all results were in) that Democrats would pick up the 60 votes needed to ensure a filibuster-proof Senate for a climate change bill, and Dikeman said he thinks Obama would likely have to scale back some of his policies to get a plan adopted.

However, Josh Becker, a founder of venture firm New Cycle Capital and co-chair of Cleantech for Obama, said he thinks the Democrats can easily pick up the extra votes across the aisle in order to get significant legislation passed on climate change.

“I feel these issues are bipartisan issues,” he said. “If we can’t get some Republican support then we’re not doing our job.”

After all, without more government aid, how can the ethanol industry expect to succeed when forced to pay such high prices for corn?

This latest proposed support for the ethanol industry comes on top of the government-mandated production levels, blender’s credit and tariff on ethanol imports. One would think these already-existing supports would be enough to get the nascent ethanol industry up and running.

The National Pork Producers Council was quick to remind Secretary Schafer that the ethanol industry was not the only one challenged by high corn prices and to point out the economic land-mine that confronts the pork industry due to ethanol’s seemingly endless government support.

In a letter to Schafer signed by the NPPC, the American Meat Institute, National Cattlemen’s Beef Association, National Chicken Council, National Meat Association, National Milk Producers Federation, National Turkey Federation and the United Egg Producers, the groups summarized animal agriculture’s continuing challenge posed by additional government aid to the ethanol industry.

“We in animal agriculture are particularly concerned that you would consider adding one more level of support for the corn-based ethanol industry,” the groups told Schafer.

The letter says that high corn prices have already caused animal agriculture real pain. The three legs of support for domestic ethanol have already had serious impact on those who produce meat for Americans and the world.

The process works by chopping the complex raw wood molecules into smaller and simpler bits — the end product being single sugar molecules. The method can also be used on other second generation ethanol feedstocks such as grass straw. Once you’ve made the sugar, the rest of the process of making ethanol is as simple as making beer — literally.

The current conventional method of making second generation cellulosic ethanol — or, “celluline,” as I like to call it — is actually very energy intensive and uses harsh chemicals to digest the woody materials in very strong acids and/or at extremely high temperature.

This new method, developed by the research group of professor Ferdi Schüth at the Max-Planck-Institut für Kohlenforschung, foregoes those energy intensive methods and works at room temperature.

Right now, the major stumbling block for the new method is that the materials used to make the salt bath are expensive. Read more.

What’s going on?
“Investment in alternative energy is becoming less attractive,” says Bob Parker, vice-chairman of CSFB Asset Management on Bloomberg. Many analysts expect oil majors such as BP and Shell to slash investment in “hard to exploit” locations, such as Canada’s oil-rich tar sands, says The Wall Street Journal’s Keith Johnson. This is despite Canada’s sands being home to “the biggest crude reserve outside Saudi Arabia”. Meanwhile, two of Canada’s biggest “tar-sands-to-crude” producers, Suncor and Petro-Canada, are already scaling back capital expenditure – most recently postponing spending on the “upgraders” that turn tar-like bitumen into high-quality crude oil.

What’s causing this sudden pullback?
Tumbling oil prices. As recently as July the price per barrel of Brent crude was setting new records – touching $147.27 – and seemed to be heading for the $200p/b (per barrel) price forecast earlier in the year by Goldman Sachs analysts. Yet the price has since crumbled to about $60 a barrel: that’s a jaw-dropping 60%. Speculators have pulled out of the market amid clear signs of rapidly disintegrating global demand, as the world economy has slowed sharply. At the current level, as Johnson puts it, “tricky new oil-production projects simply don’t make sense anymore”.

But isn’t the world running out of oil?

He admits the credit squeeze has come at a bad time for the industry and more consolidations are likely. VeraSun has already closed its plant in Montgomery County, IN, and announced the company is for sale. Rastetter predicts this is only the beginning, “A year from now we will have fewer ethanol producers than we have today.” He said those who survive will have to have the skills and the access to capitol to compete.

Following the restructure, the Atlanta, Georgia-based company now has two subsidiaries, Global Energy Systems and Global Energy Ventures.

Global Energy Systems will develop renewable energy projects with a focus on biomass and landfill-gas-to-energy. It also implements energy conservation and alternative energy projects for commercial and governmental organizations across the United States, including government agencies and the U.S. military.

Global Energy Ventures invests in early stage, strategically relevant energy companies.

Global Energy Holdings CEO David Ames said the company chose to get out of ethanol, because the market has gotten too tight amid falling oil prices.

“You can make cellulosic at a price but it’s not going to be economical when there are depressed prices for ethanol,” Ames said.

“The conclusions of these two scientific studies are historic,” said Rob Elliott, vice president of the ICGA. “Amid the long and sometimes heated debate between ethanol proponents and detractors, these studies indicate that modern ethanol plants have a superior carbon footprint and net energy benefit when compared to gasoline refineries. And, the Korves study provides compelling data that ethanol production can grow substantially at no risk to food supplies.”

The ICGA said that the state’s total ethanol output has surpassed 1.5 billion gallons annually which is about one third of total gasoline use in Illinois thereby playing a significant role in helping the country wean itself from imported/non-renewable carbon-based fuels. The growing ethanol industry is creating new jobs in rural communities.

“A single 50 MGY ethanol plant produces 32 new fulltime jobs, spends $47 million annually on local goods and services and produces $1.2 million in new taxes,” said Mr. Elliott. “Equally significant are the findings of the two studies we are releasing today which indicate clearly the promise of modern ethanol technology. They should put to rest the myth that ethanol is less environmentally friendly than the manufacture of gasoline.

Last October, the city of Houston and the UH College of Technology sponsored the third annual meeting of the Association for the Study of Peak Oil-USA. There, Matt Simmons, T. Boone Pickens and other oil experts discussed the concept of peak oil: how close the world is to producing as much oil as it can. Some, like Pickens, think the peak has already passed. Statistically, the current peak occurred in May 2005 and world oil production has declined (slightly) since then. Others disagree since recent price increases have spurred more exploration and development.

What is more, Al Gore galvanized popular opinion with his award-winning book, presentation and movie, An Inconvenient Truth. Many claim that he exaggerated the threat. While there is natural variation in the Earth’s climate, almost all scientists explain the dramatic rise in greenhouse gases and in the Earth’s temperature as the result of the combustion of fossil fuels.

There will be many twists and turns from here, but it is worthwhile to explore what the energy system might look like in the long run. Will it be the end of civilization as we know it? Will it be a permanent return to conditions similar to those that occurred after Hurricane Ike? Probably not, but it will be different, and we should start preparing for those differences today. Full article.

In Alexandria, for example, officials are seeking to shut down or restrict an ethanol transfer operation in a rail yard surrounded by townhouses, a Metro station and an elementary school, arguing that pumping hundreds of thousands of gallons of fuel daily from trains to tankers is potentially dangerous and a slap at city residents.

The loading operation, which began early in April, is part of a fast-growing national network that is moving billions of gallons of the fuel from rural areas to more populated regions such as the Washington area.

“By and large, fire departments have not been able to get the resources in place to address this particular hazard, which really is spreading,” said Alexandria Fire Chief Adam Thiel.

There have been serious ethanol accidents.

But he’s discovering another culprit: too much ethanol.

He’s seen that problem surge this year at Dale Willey Automotive in Lawrence. Even the service manager, complaining of a dip in mileage, found 20 percent ethanol sloshing around in his car’s fuel tank.

That’s double the legal limit but about the average in more than two dozen vehicles the shop has worked on. One customer had 35 percent ethanol.

“It’s getting worse and worse,” Ledbetter said.

Indeed, U.S. motorists have become unwitting players in a game of biofuel roulette.

And when they end up pumping too much ethanol into their tanks, they can likely blame something called splash blending.
It’s a popular method for blending ethanol into fuel. But critics say splash blending is prone to inaccuracy — and vulnerable to manipulation when ethanol becomes cheaper than conventional gasoline, as it has been this year. That makes it enticing to pack more ethanol into a gallon of gasoline and pocket some extra profits.

“There is a temptation,” said Cal Hodges, a chemical engineer and former employee of Amoco Oil who now is a petroleum consultant.

Adding extra ethanol to a wholesale delivery can save hundreds of dollars, he said. Read more.

There are two significant laws in EESA. A new provision enables facilities that produce cellulosic biofuels to write off their original investment more rapidly.

The provision establishes a $20 per ton market for carbon that is stored permanently.

These provisions directly affect the biofuels industry. However, what is the indirect impact of the legislation’s $700 billion cost? There are several key implications that must be considered.

The huge cost of the bailout is going to be a drag on the U.S. economy. This will result in a lower gross domestic product and growth. I attended a meeting where the president of the Kansas City Federal Reserve Bank said he expected the growth of the U.S. economy to be slower than expected for the next decade. The bank’s research department has been busy studying the effects of prior Wall Street problems, such as Penn Square Bank’s failure in 1982, as well as similar financial sector problems in Europe and Japan. Most of the downturns occur because large government financing leads to higher deficits and inflation.

I don’t believe the economy will be affected this long. The root of this problem is in credit markets, not labor or product markets that previously caused recessions. Credit markets are very efficient and respond quickly to positive news. Monetary policy usually takes six to 12 months before its effects are felt in the economy. With a $700 billion infusion from the bailout, plus another potential $150 billion from a second stimulus package, the U.S. economy should be turning around next spring.

As the U.S. economy slows, demand for gasoline and ethanol turns lower. Oil prices have fallen more than half since mid-July as the severity of Wall Street’s problems became more apparent…

Also read: Biofuel Economics: How $700 Billion Bailout Will Affect Biofuels Industry.

The average per capita consumption of energy in India is around 500 units per annum. In spite of high rate of development these figures are very low, compared to developed countries. (Middle East 10,000+, USA 8000+, Europe, Australia, Japan etc 4000+) .In our country major contribution to electrical energy generation is by coal and oil based power generation plants, followed by hydro and nuclear power generating stations. All these power generating plants (except hydro and nuclear) have contribution to CO2 emissions and global warming effects.

Many experts believe that by 2015 the supply of oil & natural gas will be unable to keep up with demand, or oil and natural gas production would be at peak by 2015. By that time the BRIC countries (Brazil, Russia, India and China) will need large quantities of oil, especially because of fast growth of the Indian and Chinese economies. Crude oil Price might shoot to the $150 per barrel level and higher. The impact on our import bill and balance of payment will be very serious.

Coal: Coal has a similar story, but may last for a longer period of time. India has extractable reserves of 52 billion tones. Annual production now is 407 million tones and the rate of growth of production is going to be very high. The Government of India predicts complete depletion of coal in 40 years. The key factor is not depletion but peaking of production which is expected by 2015 in India. A recent study predicts global peaking of production of coal by 2025. The use of coal in power industry contributes sizable amount of CO2 emissions and fly ash pollution within few kilometers around the power plant. Read more.

In an amendment approved by the lower house of parliament on Thursday to the 2009 finance bill, the government said it would cut tax breaks for biodiesel and ethanol over the next three years by less than announced previously.

The revised text also drops plans to eliminate the tax breaks completely from 2012.

“The government has listened to us,” Alain Jeanroy, coordinator of a French ethanol industry group, told Reuters.
He added that a revision clause is planned for 2010 and 2011 that would allow France to take into account a forthcoming European directive on the taxing of biofuels.

The original tax changes for biofuels, announced in the draft budget at the end of September, were condemned by industry representatives as going back on commitments to support the expansion of the fuels as part of national environment targets.

The government, which had hoped to save 401 million euros ($505 million) next year by reducing the tax breaks, had argued that the need for fiscal support was declining.

The authorities had always planned to phase out the tax advantages, but the size and timing of the cuts were a blow for producers of crop-based fuels, faced with criticism over their environmental impact and contribution to rising food prices.

Early years of government farm subsidies were designed to not only keep farmers on the land, but to provide low cost food to the urban public. Compared to most other countries the US has maintained the lowest cost for foods, despite the run-up in food prices earlier this year. But agricultural economist Dermot Hayes and his colleagues at Iowa State University say farm income is still subsidized, it is just disguised a bit.

The Iowa State research investigates the relationship among farm income, federal subsidies, and public financial support for the ethanol industry. They define ethanol subsidies as:

1) The 51¢ per gallon blenders’ credit that will drop to 45¢ in January.

2) The Renewable Fuels Standard that requires increasing amounts of gasoline to contain 10% ethanol over time.

3) The 54¢ per gallon tariff on imported ethanol.

The researchers attempt to look at the overall ethanol, gasoline, and fuel market and determine the financial benefit of the subsidies, and then calculate the financial benefit to agriculture and energy industries.

Instead of criticizing the subsidies as many economists, they contend the blenders’ credit and the tariff on Brazilian ethanol are a wash, since any Brazilian ethanol would benefit from the blenders’ credit.

Additionally, they say the ethanol mandate was the result of high energy prices and was an effort to offset them. As part of the ethanol demand benefits to corn growers, the researchers say there was a reduction in government price subsidies to corn and other crops as a result.