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By Robert Rapier on May 20, 2015 with 32 responses

Where are the Unicorns?

Congress Mandates Cellulosic Ethanol and The EPA Tracks It

unicorn

The U.S. Environmental Protection Agency (EPA) is tasked with tracking compliance under the Renewable Fuel Standard (RFS2) that was set in the Energy Independence and Security Act of 2007 (EISA). Obligated parties under the RFS2 must demonstrate compliance with Renewable Identification Numbers (RINs), which the EPA created to track RFS2 compliance. A RIN is a 38-character number assigned to a gallon equivalent of renewable fuel produced or imported. For corn ethanol, 1 gallon of ethanol produced generates 1 RIN. Other kinds of biofuel generates RINs at different rates which are defined by the EPA. For certain gaseous biofuels, such as di-methyl-ether (DME) and bio-methane (methane typically produced from sewage sludge or manure), the EPA has specified that 77,000 British thermal units (BTUs) of fuel are 1 gallon of renewable fuel equivalent. Not coincidentally, this is the energy content of 1 gallon of ethanol.

Obligated parties that produce or own RINs must register with the EPA, and RIN generation and transaction data is available from the EPA Moderated Transaction System (EMTS). A RIN is attached to each gallon of renewable fuel (or equivalent) as it is transferred to a fuel blender. After blending, RINs are separated from the blended gallon and are used by obligated parties (blenders, refiners, or importers) as proof that they have sold renewable fuels to meet their RFS mandated volumes. An obligated party can purchase RINs to satisfy their obligations, and that’s exactly what many obligated parties do.

In the 2007 EISA, Congress mandated that 100 million gallons of cellulosic ethanol had to be blended into the fuel supply in 2010, 250 million gallons in 2011, and then rapidly ramping to 16 billion gallons per year by 2022. Despite the mandates, there was no cellulosic biofuel produced in 2010 or 2011, and only 20,000 gallons were produced in 2012 by a company that subsequently declared bankruptcy. In 2013 about 230,000 gallons of cellulosic biofuel were produced by KiOR, which also subsequently went bankrupt.

I have written a number of articles on the cellulosic ethanol situation. To understand what cellulosic ethanol is, and to see that the history of this fuel in the U.S. dates back about 100 years, see my 2010 article Cellulosic Ethanol Reality Begins to Set In, my 2012 article The First Commercial Cellulosic Plant is NOT About to Open, or my 2013 article Why I Don’t Ride a Unicorn to Work.

The “First” Commercial Cellulosic Ethanol Plant is Announced

Several companies have either claimed they were about to open commercial cellulosic ethanol facilities, or that they have indeed done so. Each time this happens, there are headlines proclaiming that commercial cellulosic ethanol is a reality. My response to that is always essentially “You have to give it a few years before making that assessment.” Today, I provide evidence that despite the headlines, commercial cellulosic ethanol production has yet to be demonstrated.

In 2012, INEOS Bio and its joint venture partner New Planet Energy announced the opening of the Indian River County BioEnergy Center in Florida. Jim Greenwood, who was President and CEO of Biotechnology Industry Organization (BIO), testified before the House Committee on Agriculture “The biorefinery is a major landmark for this country. It’s the first commercial cellulosic refinery.”

Two things. The first, as you will see if you read my previous articles, is that the country’s first commercial cellulosic ethanol refinery was built nearly 100 years ago. Second, if I build a spaceship, and I tell you that commercial travel to Mars is now at hand — you would probably want to see me commercially fly that spaceship to Mars. In other words, I have to be both technically capable and it has to be economically viable before I can claim commercial success. If I spend a billion dollars and customers pay me a total of $5 million to take them to Mars, I am not a commercial success even if I am a technical success. With cash flow like that I would require heavy subsidies to keep my venture in operation.

Back to INEOS. Despite the May 2012 proclamation that the facility was about to open, it wasn’t until July 31st, 2013 that INEOS issued a press release that the company “is now producing cellulosic ethanol at commercial scale. First ethanol shipments will be released in August.” The nameplate capacity of this plant was 8 million gallons of cellulosic ethanol per year. In December 2013, the company issued a press release that said in part:

“Bringing the facility on-line and up to capacity has taken longer than planned due to several unexpected start-up issues at the Center. These efforts have highlighted some needed modifications and upgrades.”

Nine months later, in September 2014, the company issued another press release that read in part:

“INEOS Bio’s Vero Beach facility has recently completed a major turn-around that included upgrades to the technology as well as completion of annual safety inspections. We are now bringing the facility back on-line. In addition we will soon finish installation of equipment that will be used to remove impurities from one of our process streams that have been negatively impacting operations. This equipment will be commissioned and brought online over the remainder of the year.”

There have been no further operational updates. So what does the INEOS plant say about commercial cellulosic ethanol? Keep in mind that nobody disputes that you can build a plant to make cellulosic ethanol. The issue has always been about cost — due to complexity and high energy inputs. That’s why the cellulosic ethanol plants from 100 years ago were shut down.

POET Also Announces the “First” Commercial Cellulosic Ethanol Plant

Then there is POET, one of the largest producers of ethanol in the world. On July 7, 2011 the U.S. Department of Energy announced a $105 million loan guarantee to POET for the development of its 25 million gallon per year corn cob-to-ethanol facility, dubbed Project Liberty, at Emmetsberg, Iowa. Construction of the facility was expected to begin in August 2011, and cellulosic ethanol production was slated to begin in May 2013.

In September 2014, more than a year later than projected, in an announcement that must have been a surprise to INEOS, POET issued a press release: First commercial-scale cellulosic ethanol plant in the U.S. opens for business. The grand opening was attended by Willem-Alexander, King of the Netherlands, U.S. Secretary of Agriculture Tom Vilsack, Deputy Under Secretary Michael Knotek of the DOE, Iowa Governor Terry Branstad and Lieutenant Governor Kim Reynolds and thousands of guests. From the press release:

“Some have called cellulosic ethanol a ‘fantasy fuel,’ but today it becomes a reality,” said Jeff Broin, POET Founder and Executive Chairman. “With access now to new sources for energy, Project LIBERTY can be the first step in transforming our economy, our environment and our national security.”

To be clear, I never called it a fantasy fuel, I just compared commercial cellulosic ethanol to a unicorn. The “commercial” modifier is important, because once again we have known for a very long time how to produce cellulosic ethanol.

Abengoa Announces a Commercial Cellulosic Ethanol Plant 

Next up was Abengoa (NASDAQ: ABGB), which had been building a cellulosic ethanol plant in Hugoton, Kansas. In October 2014 they announced the grand opening of the facility, an event attended by U.S. Secretary of Energy Dr. Ernest Moniz, Kansas Governor Sam Brownback and Kansas Senator Pat Roberts. The press release stated in part:

“Abengoa’s new industry-leading biorefinery finished construction in mid-August and began producing cellulosic ethanol at the end of September with the capacity to produce up to 25 million gallons per year.”

Last week, here was what Abengoa CEO Manuel Sánchez Ortega said about the facility when addressing Q1 2015 earnings:

“With regards to Hugoton, we continue working in the startup of the plant where we are making progress everyday resolving the issues that we have encountered, all of them related to the mechanical part of the plant. The bad news is that we still have our work to do to fix all identified challenges and the good news is that none of this are related to the biochemical process, which is the innovative part of the project.”

Is commercial cellulosic ethanol a reality? Certainly not yet according to Hugoton.

Report Card

While both INEOS and Abengoa have announced problems, to my knowledge POET has been silent about their progress. But they do all report production numbers to the EPA. The newest numbers were released today for April 2015 production.

Keep in mind that April 2015 marks nearly 2 years since INEOS announced they were producing commercial cellulosic ethanol. For POET and Abengoa, April marked the 8th month since they had announced the beginning of production. The total announced nameplate capacity of these 3 plants is 58 million gallons. So how close have they come to achieving this capacity?

Through March, EPA had listed year-to-date production of 286,237 gallon of cellulosic ethanol. The newly released data show that for April, the year-to-date cellulosic ethanol production was 574,922 gallons. This means that April’s production was 288,685 gallons. Annualized, this comes out to be 3.5 million gallons from plants with total announced nameplate capacity of 58 million gallons. Total production for the record month of April was then only 6% of nameplate capacity. That’s pretty bad considering these companies are at least 8 months into their learning curves. Normal learning curves on a process don’t mean sub-10% capacity more than 6 months after start-up. That’s an indication that serious miscalculations have been made about the complexity of the process.

The reason this is significant is that the production volumes have to be supported by the capital that is spent. If, in reality, only a fraction of the nameplate capacity can be reached (and clearly from the INEOS and Abengoa updates the capital costs are still rising) the hundreds of millions of dollars of capital buy very few actual gallons of capacity. Production at only a fraction of nameplate capacity will destroy the economics of the process and in turn the notion that commercial cellulosic ethanol is now a reality. A publicly traded company would eventually have to take an impairment against the facility — as KiOR did prior to their bankruptcy.

Still No Unicorns

While companies are rushing to take credit for commercial production of cellulosic ethanol, a look at the numbers released by the EPA today tells a different story. They warn of very high capital costs per actual gallon of production — a recipe for commercial failure. On the positive side, April’s numbers were slightly greater than the year-to-date production of the previous 3 months combined. If I had to guess, based on the lower capacity of INEOS and the ongoing problems at Abengoa, that production is predominantly POET’s.

POET probably does have the greatest chance of success. By co-locating their cellulosic ethanol process adjacent to one of their corn ethanol plants, they can share infrastructure, energy, and personnel – driving down costs. But the capital cost of that facility was announced at $275 million. Even if we assume that all of April’s production was from POET, it’s going to take a lot more than 3.5 million gallons of ethanol per year to support that level of capital spending – at least commercially. On the spot market that much ethanol per year would currently sell for about $5 million. Production rates will have to be more than an order of magnitude higher to justify hundreds of millions in capital spending.

Of course you can subsidize all sorts of schemes into existence. The real question is whether there is a realistic pathway to the process standing on its own commercially. We will check back in on this developing situation later in the year, but it’s going to require exponential production increases over the next few months to salvage the economics. Alas, despite claims of unicorn sightings, I still can’t find one to ride to work.



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Link to Original Article: Where are the Unicorns?

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  1. By jameshrust on May 21, 2015 at 6:15 pm

    I presume the tax payers are taking a bath on all this unnecessary production of a fuel no one wants.
    James H. Rust, professor of nuclear engineering

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  2. By Big John on May 22, 2015 at 5:17 pm

    I would guess the cellulosic ethanol RINs are being generated by QCCP, or maybe API’s Alpena MI demo plant, not POET. QCCP has produced 1 mil gal since late summer 2014. POET would likely issue a press release when it produces its first RINs. Isn’t a key issue that POET and Abengoa are trying to ramp up their ‘commercial scale’ plant by about 1000x? KiOR was only a 55x scaleup. I think INEOS is about 200x. POET has a 25,000 gal pilot plant, and has built a ~25 mil gal ‘pioneer’ plant. What are chances of a rapid and successful 1000x scale-up? Maybe there will be some major design and process improvements based on the current experiences with these pioneer plants, but clearly their progress is failing to come anywhere close to their (or EPA’s) predictions. I think that Beta Renewables Crescentino facility also was not performing to expections, and have not heard anything about how GranBio’s Brazilian plant is doing after starting up last Fall. Enerkem seems to be perennially a year from producing ethanol. Will be interesting to see how DuPont does with their Nevada plant – that is a 100x scale up. Eventually somebody will be successful with cellulosic, but it’s going to be a lot tougher and longer slog than proponents have suggested.

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    • By Robert Rapier on May 22, 2015 at 9:34 pm

      “I would guess the cellulosic ethanol RINs are being generated by QCCP”

      I forgot that they were also the “first” to produce commercial cellulosic ethanol. Funny thing about their process is that I suggested to someone in London about 10 years ago that the cellulose around the corn was the lowest hanging fruit and that it should be pretty easy to convert it into ethanol. But it is also very easy to see how a process like that could cheat the system. Claim some ethanol that came from starch actually came from cellulose.

      But, 1 million gallons over 2 years isn’t a high enough rate. POET or Abengoa are the only ones capable of producing at a high enough rate to explain April’s production numbers.

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      • By Advocatus Diaboli on May 23, 2015 at 3:38 pm

        Crescentino was also the “first”, at least in Europe, where I live.
        As Big John mentioned, there is curious silence about it. There are two (unconfirmed, but reasonably credible) things I heard about them recently, which I found interesting:
        - A representative of Crescentino noted at an event a few months ago that the regulatory environment was not good for ethanol fuel, and that if it stayed like this they would start producing for the chemicals industry.
        - The representative of another company mentioned that Crescentino is using, at least in part, wood pellets as feedstock.
        The former is curious because “advanced” fuels are supported to the hilt in the EU (not just eligible for subsidies, but they are also double counted towards the EU’s renewables targets). The latter is important because if cellulosic ethanol makes any sense at all, it would be for being able to use feedstocks that does not compete (much) with other needs. Crescentino has claimed to use rice straw and energy grasses grown on degraded/abndoned land, which would seem preferebale to foodcrops. But wood pellets are typically made out of industrial wood and have plenty of other uses. If true, I wonder whether the reasons are purely economic (cheaper to source pellets) or technological (e.g., it might be easier to process pellets produced from pure wood than straw or grasses that might be more heterogenous.

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  3. By Russ Finley on May 22, 2015 at 8:45 pm

    Countering lay press cellulosic ethanol stories is like playing a game of whac-a-mole ; )

    http://ecx.images-amazon.com/images/I/51oAOswldjL.jpg

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  4. By Forrest on May 23, 2015 at 9:16 am

    Your analogy entertaining per the mocking of cellulosic ethanol, but as you post not accurate per real production. Economic success is a vague rating. The industry communicates they are not on price parity of corn ethanol nor gasoline. They are on a steep learning curve. You post as if the current technology is nothing new. Much like claiming fire or combustion isn’t anything new and modern heat engines offer no new invention. The fate of some biofuel companies going broke may or may not be a harbinger of coming doom for the entire industry. Notice petrol is making moves on biofuel and communicating to investors of the wisdom. Shell is making a substantial investment within Brazil for cellulose and sugar biofuel and offers an E85 product with their name. Both ethanol and petrol is currently suffering from $40-$50/barrel trades. Saudi oil pumping is hoping to damage both developments. Some oil rig companies have closed doors or stopped drilling. Companies with high debt load, vulnerable. Ethanol, currently sitting within a firm financial position, but lean. Some plant expansions and building including cellulosic on the international arena. Present day, cellulosic suffers from oil campaign to persuade lawmakers to pull the plug on RFS or make major revisions. The campaign dampening or scaring investment crowd and slowing progression of the ethanol industry. Today producers are more concerned of maintaining cash flow and positive balance sheet than investing in expensive fuel production. Current production is losing money on every gallon of cellulosic ethanol, per the $50/barrel competition and messed up RIN market. They would naturally cut production to minimum and do so only to trouble shoot and understand the process. Albengoa has communicated this upon their 25 m gallon plant. Their evaluating market and storing significant production.

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    • By Robert Rapier on May 23, 2015 at 12:05 pm

      “You post as if the current technology is nothing new. Much like claiming fire or combustion isn’t anything new and modern heat engines offer no new invention.”

      They are still dealing very much with the problems they were dealing with 100 years ago. Mother Nature designed cellulose to be difficult to access and break down. In the process of doing so, unwanted things get broken down. They poison the process. So, while the technology to break it down is different with enzymes, all the other associated problems remain and that’s the real issue.

      Let me give you a “what if.” Lots of companies promised cheap fuel and then failed to deliver because they underestimated the complexity of the process. In many cases, the fuel cost an order of magnitude (or more) than the promised cost. So it may not be $50 oil or oil company resistance that’s the problem. What if they really need $250 oil to compete? That could very well be the case here. In fact, if you factor in the cost of capital and the fact that they still haven’t gotten the process ramped up, it probably is the case. That is what you don’t consider. That the process is fundamentally flawed from an economic perspective and we are nowhere near the economic conditions for this process to succeed. You know, like it was 100 years ago.

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      • By Forrest on May 25, 2015 at 7:07 am

        This is where experience, modern process control, and new technology come into play. Gen one corn starch ethanol production as to be a proving ground of managing biological production of ethanol fuel. This generation made improvement stacked upon improvement and sustained a long learning curve that continues with new equipment, feed stock, pretreatments, process capability, strains of enzymes, microbes, conditioning, stabilizing, sterilizing, filtering, storing, processing, improved feed nutrition, distribution, sales, pricing, marketing, etc. This learning curve was the bootstrap to assist cellulosic and competing feedstock to become successful. I remember a story of harmful elements within ethanol mix and success to track down the reoccurring problem. It was chlorine within public water supply. The processors subsequently developed higher water purity standards to improve fuel quality. Novozymes, has a strong business success history within the biological field of enzymes and microbes. Currently, they offer online education resources in effort to maximize process capability. The education and exploitation of the biological process continues to improve. The pilot process stage of cellulosic long gone. A decade of process information tabulated to ensure successful investor and taxpayer proceeds. Some companies that had nothing to lose and had only one game to play, did maximize hype to attract investments in hope of breakthrough success before the clock ran out.
        Think of the recent technology advances yet to be harvested. GMO trees and feedstock plants that grow a large portion of easy to process cellulose and do so upon maximum growth rates. Green solvents (U of Wis. and Perdue) that speed up and lower cost of the pretreat phase. Cellulosic process time constraints cut in half. The ongoing testing to utilize algae for fuel and food stock within the CO2 waste stream. The fungi utilization of water cleanup, feed additive, or even within a new process to direct fuel production. Microbes and fungi technology just getting started to promote healthy soil and plant life. Biochar developments that greatly improve farm yields and may push biofuel to negative carbon rating. In fact the leaders within this sector don’t communicate technological roadblocks or speed bumps, but of growing opportunities and international growth. It will be low growth, but steady and sustained. U.N. is pushing international cooperation to achieve 2x renewable energy by 2030. The globe utilizes 15% currently from all sources. Solar, wind, and hydro will increase, but biomass may do some heavy lifting. Lots of talk of Africa with huge potential and the financial benefit to poor continent. I think the biggest threat to cellulosic ethanol lies with competing processes i.e. Red Rock thermal.

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        • By Optimist on May 26, 2015 at 6:16 pm

          None of which changes the underlying reality that ethanol is a crappy fuel.

          But hey, have at it. Just leave me and my tax $$$ out of it…

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          • By Forrest on May 27, 2015 at 7:44 am

            If ethanol so crappy, why is ethanol required to make gasoline burnable within modern engines per lower pollution requirements? If the fuel so weak why did Cummins E85 engine generate twice the torque per displacement compared to diesel? The same E85 engine beat mileage of gasoline engine. Why is the fuel so popular upon the race track? You would, indeed, have a job to determine your tax investment portion for ethanol. But, your consumer savings at the pump would dwarf that portion. Ethanol has top tier fuel character per ignition, flame speed, oxygen content, purity, and simple stable chemistry that improves the ability to control pollutants. Ethanol already sits at the top tier fuel per cost and contribution to low pollution yet has not been exploited by automotive to improve performance. Its mission is currently to offer burn ability within gasoline engineered engines and get along with low torque transmissions. The E85 engine from Cummins proves what is possible if ever engineering for ethanol. Half of gasoline auto emissions due to common vaporization of the fuel. E85 has lower vapor pressure and naturally will decrease this, another bonus.

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            • By Optimist on May 27, 2015 at 1:54 pm

              I call *CRAP* on that entire post.

              Your faith in ethanol is touching, but sorely misplaced.

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  5. By Forrest on May 24, 2015 at 7:35 am

    Quad County is losing traction to license technology for cellulosic expansion. Their bolt on process should spread quickly since the process would produce 6% more ethanol with attractive cellulosic RIN attached. Problem is they can’t sell any RINs and forced to dump the production to corn ethanol. Obligated refiners are purchasing waiver credits and communicated they will continue avoiding purchase of cellulosic RINs even if it is more expensive to do so. Guess, they have little obligation within the law and very capable of putting up roadblocks, then pivot to discredit the sector with lack of progress. Oil proponents communicate the futility of ethanol production or the sales of the fuel and then demand change in RFS to take away incentives to do so. If ethanol production and sales a joke, why are they so concerned of the competition? Wouldn’t you think they
    wouldn’t bother their little head of such annoyances and silly popular developments? Do you really think the millions of dollars invested in negative advertising are directed to solely protect the food supply, small engines, and motorist?

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    • By Optimist on May 26, 2015 at 6:12 pm

      But hey, the millions of tax $$$ spent on promoting ethanol is all a good investment in the future, right? As long as its someone else’s money, it’s all good, ain’t it?

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      • By Forrest on May 27, 2015 at 7:18 am

        Not when your company is legally obligated and invests to thwart will of people. Citizens need to be alarmed per oil’s actions to monopolize control and pollute market competition and competitor development. These International Corporations have a long history of unfair practices that do not align with proper functioning consumer choice and benefits. Why do they spend so much upon politics and negative advertising? They are in process of maximizing their crony capitalism influence to stop the competition and if possible purchase the bankrupt pieces up at fire sale for their revenue stream. It’s not that the fuel is bad, it’s that they don’t yet control the market.

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        • By Optimist on May 27, 2015 at 1:52 pm

          You want to talk about crony capitalism and corruption? Let’s talk about all those subdidies the ethanol industry takes.
          And BTW, you can’t have it both ways. Ethanol can’t be big enough to loosen fuel prices out of OPEC’s grip AND small enough to justify endless subsidies and mandates…

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  6. By Forrest on May 26, 2015 at 8:57 am

    As you post, April D3 RINs probably coming from single source, Poet. Then April’s production about 14% of name plate production. But to be an accurate prediction, the trend should be evaluated. The acceleration of production may be a very good indicator of cellulosic progress. Also, when attempting to evaluate success of cellulosic processors production, one must consider the effects of external factors such as current day competitors price of energy, RFS regulation stability, functional RIN market, economy health, investor or subsidy migrations, and public goodwill. If these external factors less positive, then production numbers become more impressive. As powerful petrol continues to stomp on the ethanol insect, it becomes more impressive to witness the tiny creature crawl out and grow. Time is on the side of biofuel production as the public has currently and temporarily been served up a diet high on negative indoctrination. As the public gains confidence and experiences positive results the job to more production will become easier. I just read today an interesting article that the current fleet of extra high efficient engines could easily be tweaked to E30 fuel and suffer no mileage penalty. Also, ethanol industry is on the path to migrate from D6 to D5 advanced biofuels with 70% GHG reductions. Not the least the health and environment concerns pushing E15 to E30 blends of gasoline to avoid the most health damaging blend components of gasoline. Consider, high torque engine manufactures looking hard at ethanol per the doubling of their torque values and minimizing PM pollution and do so with a lighter and cheaper engine.
    As you know the first of kind process plant is all custom engineered and fabricated with extreme high cost. The plant is built to maximize flexibility and robustness to ensure success. The elimination of this redundancy will bring the cost of process plants down as well as continuous improvements within the technology. The technology is on a high rate of innovation. The process can go through a shake down to basic plant design and construction efficiency can enter the low cost cookie cutter stage.

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    • By Optimist on May 26, 2015 at 6:10 pm

      All that stomping has affected your vision, Forrest (of no trees),
      What do you mean by: “As powerful petrol continues to stomp on the ethanol insect…”? The only thing stomping the ethanol insect, and insect is the right name, is the technological and financial realities involved in producing the wonder fuel, or should that be the beetle juice?

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      • By Forrest on May 27, 2015 at 7:05 am

        Top four oil companies generate $1.5 trillion in revenue or more than most countries GNP per 2012. Ethanol with feed sales about 2% of this and upon small business, yet those all concerned of welfare of oil attempting to depict agriculture ethanol sales as big business and unfair protection within government regulations. Would consumers best serve to eliminate competition at the fuel pump. Evaluation by economist say consumers save a bundle since injecting competition. Fuel prices are lower and more stable, thank you ethanol.

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        • By Optimist on May 27, 2015 at 1:49 pm

          The only “economists” who say that, are those bought and paid for by the tiny, but well-funded (“Thank you, Uncle Sam!”) ethanol industry.
          You may have noticed that fuel prices kept going up as ethanol production was ramped up circa ~2005. Then ethanol production leveled off, thanks to the blend wall, among other things. Suddenly the floor fell out of fuel prices.

          Coincidence?

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  7. By Forrest on May 29, 2015 at 7:28 am

    Patriot Renewable Fuels, Annawan, IL is adding cellulosic gen
    1.5 grain fiber process (ICM) to their 130mg/yr corn ethanol plant. Also, they are adapting 2rd gen cellulosic per the Ibicon Dutch
    process with plans for 30mg/yr corn stock process. The Ibicon process doesn’t
    require costly special equipment. All components are off the shelf hardware,
    typical of corn process plant. The pretreatment of acid and steam explosion not
    needed as the process utilizes enzymatic hydrolysis. The typical acid process also,
    required post treatment of base chemicals to alter PH. The quality of
    co-product, lignin, is superior with the Ibicon process as a result. The
    company claims enzyme can be sourced from three competing companies. The
    process is flexible per managing co products of ethanol, biogas, feed,
    molasses, and lignin pellets. The lignin pellet co-product fuel is attractive per
    power generation and process needs. Same for the anaerobic digester gas. The
    process utilizes components of the existing grain ethanol plant and can supply
    both sides process heat. Both sides can supply digester feed stock or increase
    feed component. Pellets can be utilized upon product sales. The process
    calculates to 25# of biomass per gallon of ethanol. Some of the competing processes sit
    at 22# per gallon, but this process less costly to install and may be less
    complicated to operate. Co-products valuable as well, for most processes.

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  8. By Benjamin Cole on June 9, 2015 at 11:44 pm

    Taxing gasoline would obtain better results than subsidizing most bio-fuels.

    But! Taxing gasoline would place taxes on rural states with their long commutes, rural states which have two Senators each. And subsidizing bio-fuels means jobs for rural states, which have two Senators each.

    Guess what?

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  9. By Ike_Kiefer on June 23, 2015 at 7:37 pm

    Besides SEC filings, the best way to judge what is happening from outside is to visit the media section of the company websites. When the optimistic weekly updates suddenly stop, and are replaced by generic news feeds from BIO, or silence, then be assured, no news is bad news. Just revisted Dupont Nevada and Abengoa Huguton and Poet Liberty websites. Nothing new on any since 2014 — except for new leadership for Liberty. When you lose money on every gallon produced, and economy of scale works backwards because feedstock transportation costs dominate, and the process engineers and chemists can’t find a magic bullet to triple yields and halve COGS to make up the difference, there is not much you want to share with the shareholders or the public.

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  10. By Anon2012_2014 on June 26, 2015 at 7:39 am

    Corn ethanol = economic waste of money, energy for nitrogen, and water. It only exists due to misplaced government mandate.

    Cellulosic ethanol from cheaper (money, energy, and water) crops is possible but not proven.

    I’d like to see the government get out of corn ethanol while supporting the development of cellulosic for such time as it is needed in the future when frack crude eventually runs low. That would be maybe 50 years from now so there is no rush.

    In the interim, we need to get the water and carbon out of our fuel production.

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    • By Forrest on June 27, 2015 at 2:14 am

      Economic speaking, ethanol saves the consumer and taxpayer. The RFS per corn ethanol a good thing for motorist per air quality and pocket book expense. Farm subsidies are down since ethanol improved farm income. Recent study just concluded ethanol free gas is more harmful for engines as compared to unleaded. More engine wear, more seal damage, and more carcinogens within tailpipe emissions. Ethanol makes gasoline a better product. The oxygenate character of the fuel enables gasoline to burn cleaner. The additive increases gasoline performance per burn and wipes out half of energy loss of the lower btu fuel. Ethanol adds octane to gasoline and does so cheaper than any other additive. Efficient engines could do more with higher octane fuels.
      Nine out of 10 acres of corn sits within field with no irrigation other than natural rainfall. Be careful upon reading analysis of corn water use. The calculations often include rainfall to make the report damaging. Same with the net energy ratio’s of corn ethanol whereupon they attach solar energy. One fact is certain, energy use and cost of petrol is increasing compared to the competition. Ethanol for example is steadily improving efficiency per agronomics, conversion, processing, and coproducts. Per ’08 USDA study dry grind ethanol sits at 2.3. If they power utilizing biomass 2.8. Biomass utilizing perennial feedstock that requires no fertilizer or irrigation could move the needle to 26. RR had a post calculating petrol at 8.5 to 1, but he intentionally eliminated the transportation energy waste that I would think hurt petrol since it has high international transport needs compared to local ethanol. Here in SW Michigan my ethanol farm to pump is only 60 miles. Also, note petrol really doesn’t produce energy, at least from solar on up. Its a harvest or mining technique. For example one might think a smart idea to cut down your 100 year old shade tree as the energy ratio for heating your house would be magnificent. Problem is this method of home heating has a 100 year cycle. What is fossil fuel cycle? You did mention use it until you lose it, but it may be better to conserve it with more ethanol.

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      • By Anon2012_2014 on June 27, 2015 at 1:45 pm

        Forrest,

        I’d like to see your corn ethanol be sold WITHOUT any government mandate as a cheaper octane booster. Let the market set the value. Otto cycle engines are more efficient with higher compression ratios and ethanol is one way to allow a higher compression ratio without pre-ignition (which turns that efficiency gain into a huge loss). If it was cheaper per mile, we’d all burn 100% ethanol. It’s not.

        I object to blending mandates. If your corn ethanol is so economically cheap, we will buy it and burn it anyway the same way we now buy and “burn” solar PV because it is cheaper than line power in more and more places WITHOUT government subsidy or mandate. And solar (and maybe your corn ethanol) is getting cheaper every year. By 2038 it will be cheaper than natural gas at utility scale.

        Without subsidies and mandates, you farmers will grow the most profitable crop on your farm within the then current technology. Might be corn with cellulosic ethanol made from the excess stalks, cobs, and leaves. Might be switchgrass with no irrigation and no nitrogen based fertilizers. Might be food corn with the excess made into cellulosic. Depends on how hungry we are. Liquid biofuels are part of the future because fossil fuel WILL run out (maybe in 200 years). But we need to get rid of the politically established government mandate, and, farmers need to pay for their aquifer usage at the cost of replenishment so as to discourage wasteful agriculture and sharing with their own future. Might be cheap water, but it’s not free to waste.

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        • By Forrest on June 28, 2015 at 7:59 am

          Well, some environmentalista want to attach the indirect cost of petrol from increased health care and air pollution. The thinking goes air is a natural resource and utilized by pretrol per contamination. Same per unhealthy tailpipe emissions, that inflict a cost on society. Currently, Calf. EPA has attached a IDLU penalty to corn ethanol per theoretical concerns that within reality have been proven wrong, yet they keep the demerits.
          Don’t forget the mandate RFS cost the taxpayer nothing other than administration costs and per my knowledge (at least with corn ethanol) saves the consumer money. The mandate has a wide range of alternative fuels, divided by production process and benefit to environment. E10 or base unleaded was a natural progression from the Industry to standardize fuel. Blenders and base stock must meet EPA vapor pressure regs among others such as oxygenate. They dropped that requirement as E10 made the reg obsolete. Most of corn ethanol goes to this required use. The ethanol free gasoline that utilizes petrol only chemicals is more expensive and suffers more engine wear, air pollution, and unhealthy tailpipe emissions. If ever the fuel increased i volume they would need to improve the fuel.

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          • By Forrest on June 28, 2015 at 8:23 am

            The purpose of RFS is to stabilize market and provide a stable schedule and predictability for investors, invention, R&D efforts, auto manufacturers, ect. It sets into law the minimum future production. The industry can achieve high reliability upon investments as radical swings in normal marketplace lightened up. Petrol has long history of attacking competitors, much of it proven only upon history lesson or after the damage done. We have an aberration within single source energy market that really isn’t a normal market. For example investors of petrol glee with the fact that when petrol screws up they gain wealth. Not normal. There was no alternative choice at pump. The fuel is a commodity and inelastic, at least short term. Both political parties have supported RFS legislation and it’s popular with citizens whom can see the benefit especially to future. All know petrol is on an increasing scarcity curve, higher cost, and more polluting. Also, they know the natural resource is valuable and look at ethanol to conserve the resource. Ethanol makes gasoline a better fuel and can pull the fuel into higher efficiency engines, a good thing. Ethanol is on a curve of increased production, lower cost, improved emissions, etc. Actually, some of what you post is already happening. Their is group of engineers promoting E100 fuel with website. Engine technology is different for the fuel and best utilization or to accomplish full benefit upon purity. A big spike in torque (the primary determinate of high mileage) with pure ethanol. Same with low emissions. But, the supply of ethanol is insufficient for such. You would need multiple more supply for those efforts to fruit.

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            • By Forrest on June 28, 2015 at 8:39 am

              Ethanol has been the additive of choice of petrol for years. Some ethanol production maintained since the Jimmy Carter Gasohol years. Poets first historic plant being one. They utilized the fuel to dry out gas in winter months, oxygenate, and octane booster per low percentage additive. Nothing currently in the running per cost and benefit to compete upon these needs of gasoline. I do believe E10 fuel is the fuel of choice of petrol, but they can present themselves as victim to supporters and achieve high margins for offering an alternative, a nice marketing ploy. Same with the huge assortment of fuel additives that make a bundle selling to public solutions that mimic that which ethanol already accomplishes. Petrol enjoys benefits of E10, but fight vociferously against higher blends. Why? Because once the public introduced to benefits and low cost no going back to hating ethanol.
              The current suggestion of EPA and RFS reqs are suspiciously in line with petrol wants. Vetting the RIN market, it looks as if petrol is spending extra money to sabotage ethanol by reporting to public high costs and banking RINS to flood market at appropriate time to maximize economic damage to industry.

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            • By Forrest on June 28, 2015 at 8:56 am

              Another factor public should consider, the corruption that affords easy money wealth. Riches of harvesting natural resources seem to always end badly per concentration of wealth. Government decision makers upon international community easily corrupted and many are tyrants, dictators, and those hating U.S.. Even terrorist enjoy tapping the illegal trade. Even within U.S. the problem. Williston was in the news per report of suffering the huge investment in infrastructure need per boom only now suffering with huge loss in drill rigs. Illegal activity flourished and all public services at the breaking point. My extended family from Wisconsin enjoy the wealth, but one youth ended his life under very suspicious chain of events. He walked 20 miles back to town from trailer park temporary housing with “friends”.one late night to suffer a heart attack at hotel. Minimal investigation as the community was out of control with needs. Compare the job creation and small business development to rural communities that ethanol develops. Not many terrorist attempting to take over farm operations.

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            • By jkledricks on October 21, 2015 at 1:18 pm

              You must stop basing your knowledge entirely on propaganda from the ethanol industry. Blending ethanol into gasoline does not change the energy efficiency of the engine (compared with gasoline at standard specification), and since ethanol contains less energy per gallon, it reduces your miles-per-gallon significantly.

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            • By Forrest on October 21, 2015 at 5:07 pm

              You have an amazing grasp on fuel and engine technology! I suggest you link to Marc and discus your wisdom. Also, google just about any technical article on the subject and of course avoid what you accuse me of doing.

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          • By jkledricks on October 21, 2015 at 1:18 pm

            “RFS cost the taxpayer nothing other than administration costs and per my knowledge (at least with corn ethanol) saves the consumer money.”
            Don’t be ridiculous. If corn ethanol was cheaper to produce you wouldn’t need a mandate! In fact it’s highly subsidized by the taxpayer and motorist. It’s the most expensive way ever to reduce fossil emissions. Google ‘global subsidies initiative’

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