Biomass Magazine - March 2010

INSIDE: ENERGY CROPS CREATE OPPORTUNITIES, CHALLENGES March 2010

Lock, Stock and Biomass Crop Residue Will Play an Important Role in Developing the Cellulosic Ethanol Industry

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4 BIOMASS MAGAZINE 3|2010

INSIDE

MARCH 2010

VOLUME 4

ISSUE 03

FEATURES .....................

24 ENERGY CROPS Energy Crop Conundrum Traits of dedicated energy crops such as switchgrass, miscanthus and jatropha are being tweaked to make them more economically efficient to plant, grow and harvest.

By Lisa Gibson

32 MISCANTHUS Make Way for Miscanthus Interest in miscanthus has intensified along with research efforts that focus on creating new, higher yielding strains and developing harvesting and planting techniques that will result in its commercial production.

By Anna Austin

40 PROFILE It’s Show Time Members of Missouri-based Show Me Energy Co-op believe their grower-owned pellet plant is a model for success that others can replicate.

By Rona Johnson

46 CROP RESIDUE The Path to Cellulosic Ethanol

MISCANTHUS | PAGE 32

Crop residue is being looked at more closely as feedstock for cellulosic ethanol. Although supplies are ample, there are concerns about how much to remove.

By Lisa Gibson

DEPARTMENTS .....................

06 Editor’s Note Federal Support for Biofuels Intensifies

By Rona Johnson

07 Advertiser Index 08 Industry Events

CONTRIBUTIONS .....................

52 INTERNATIONAL Forest Biomass Generation in Degraded, Steep, Outcropped Ecosystems A company in Uruguay has developed a cropping system to plant trees in areas of the country where conditions are unsuitable for conventional farming.

By Pablo Reali

09 Biomass Power Association Congress Should Support a Strong RES That Will Create Millions of New Jobs

By Bob Cleaves

11 EERC Update Renewable Nitrogen Fertilizer Production

By Ted Aulich

13 Legal Perspectives Creditworthiness Key to Biomass Project Success

By John Eustermann

14 Business Briefs 16 Biobytes 18 Industry News 54 Marketplace

3 |2010 BIOMASS MAGAZINE 5

editor’s

NOTE Federal Support for Biofuels Intensifies

T

here was a flurry of activity in the first week of February as the government released the proposed rule for the Biomass Crop Assistance Program, the final rule to implement the renewable fuels standard (RFS2) of 36 billion gallons by 2022, and the administration’s Biofuels Interagency Working Group released its first report aimed at boosting biofuels production.

The RFS2 reduced the requirement for cellulosic ethanol from 100 million gallons to 6.5 million gallons, but the industry seemed to think that was a fair judgment as it is still in the early stages of development.

We at Biomass Magazine are still going through the 104-page proposed rule for the BCAP program but we encourage readers who have concerns to send their comments to the USDA. A copy of the rule and comment instructions can be found at www.fsa. usda.gov/bcap.

The biofuels working group report called “Growing America’s Fuel” can be found at www. whitehouse.gov/sites/default/files/rss_viewer/growing_americas_fuels.PDF. The report outlines the steps the government needs to take to achieve the 36 billion gallon goal. It emphasizes the implementation of a supply chain systems approach that makes sure that the biofuels produced are compatible with our transportation fuels infrastructure, and it establishes lead agencies that will be responsible for each segment of that chain. Also in the report, is a proposal to create USDA Regional Feedstock Research Centers to “develop sustainable supply chain strategies and science-based implementation plans designed to accelerate biofuels feedstock production and reduce transaction costs to feedstock producers and biorefineries.”

All this activity came on the heels of President Barack Obama’s State of the Union address in January where his commitment to renewable energy was clear when he talked about the need to encourage innovation. “Last year, we made the largest investment in basic research funding in history an investment that kills cancer cells but leaves healthy ones untouched,” Obama said.

“And no area is more ripe for such innovation than energy.” Although he used advanced batteries and solar panels as examples, we in the industry know that biomass-based power is much more efficient.

Obama also mentioned the need for continued investment in renewable fuels, which is crucial if we want to be able to commercially produce fuel from crop residue and energy crops, which is what this issue is all about.

In his address, the president also said one of his goals is to increase the amount of goods that the country exports. “Because the more products we make and sell to other countries, the more jobs we support right here in America," Obama said. "So tonight, we set a new goal: We will double our exports over the next five years, an increase that will support 2 million jobs in America. To help meet this goal, we're launching a National Export Initiative that will help farmers and small businesses increase their exports, and reform export controls consistent with national security.” I believe the biomass industry could help with this goal by shipping products such as wood chips, biomass pellets and torrified biomass and biomass-based chemicals and fertilizers to other countries.

Rona Johnson Editor rjohnson@bbiinternational.com

6 BIOMASS MAGAZINE 3|2010

advertiser INDEX

EDITORIAL

PUBLISHING & SALES

EDITOR Rona Johnson rjohnson@bbiinternational.com

CHAIRMAN Mike Bryan mbryan@bbiinternational.com

ASSOCIATE EDITORS Anna Austin aaustin@bbiinternational.com Lisa Gibson lgibson@bbiinternational.com COPY EDITOR Jan Tellmann jtellmann@bbiinternational.com

2010 International BIOMASS Conference & Expo

CEO Joe Bryan jbryan@bbiinternational.com VICE PRESIDENT, CONTENT Tom Bryan tbryan@bbiinternational.com VICE PRESIDENT, SALES & MARKETING Matthew Spoor mspoor@bbiinternational.com EXECUTIVE ACCOUNT MANAGER Howard Brockhouse hbrockhouse@bbiinternational.com

ART ART DIRECTOR Jaci Satterlund jsatterlund@bbiinternational.com GRAPHIC DESIGNERS Elizabeth Burslie bburslie@bbiinternational.com Sam Melquist smelquist@bbiinternational.com

CIRCULATION MANAGER Jessica Beaudry jbeaudry@bbiinternational.com

Subscriptions Subscriptions to Biomass Magazine are $24.95 per year in the U.S; $39.95 in Canada and Mexico; and $49.95 outside North America. Subscriptions can be completed online at www.BiomassMagazine. com or subscribe over the phone at (701) 746-8385.

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Advertising Biomass Magazine provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about Biomass Magazine advertising opportunities, please contact us at (701) 746-8385 or service@ bbiinternational.com.

4

2010 Southeast Biomass Conference & Expo

10

Advanced Trailer Industries

29

Agra Industries

35

Biodiesel Magazine

55

BRUKS Rockwood

36

Buhler Inc.

31

Church & Dwight Co, Inc.

45

CPM Roskamp Champion

26 & 49 34

Energy & Environmental Research Center

ACCOUNT MANAGERS Marty Steen msteen@bbiinternational.com Bob Brown bbrown@bbiinternational.com Gary Shields gshields@bbiinternational.com

ADVERTISING COORDINATOR Marla DeFoe mdefoe@bbiinternational.com

2010 Northeast Biomass Conference & Expo

Detroit Stoker Company

SENIOR ACCOUNT MANAGER Jeremy Hanson jhanson@bbiinternational.com

SUBSCRIBER ACQUISITION MANAGER Jason Smith jsmith@bbiinternational.com

56

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Frazier, Barnes & Associates, LLC

51

Genencor速 - A Danisco Division

12

Hoffmann, Inc.

39

Hurst Boiler & Welding Co. Inc.

50

Indeck Power Equipment Co.

27

Jeffrey Rader Corporation

42

KEITH Manufacturing Company

43

Larox Corp.

30

MAC Equipment

2

Morbark, Inc.

37

The NanoSteel Company

44

The Teaford Co. Inc.

28

West Salem Machinery

48

Wolf Material Handling Systems

38

Letters to the Editor We welcome letters to the editor. Send to Biomass Magazine Letters to the Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or e-mail to rjohnson@ bbiinternational.com. Please include your name, address and phone number. Letters may be edited for clarity and/or space.

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3 |2010 BIOMASS MAGAZINE 7

industry events Biomass Trade & Power

World Biofuels Markets

March 11-12, 2010

March 15-17, 2010

Golden Tulip Rotterdam Centre Rotterdam, Netherlands This conference will explore the rise of a new biocommodity for clean power generation. Several companies will attend the event to discuss the European Union’s pending bioenergy mandates, sustainability and certification, biomass power generation growth in Europe, opportunities and barriers to developing a global biomass trade network, and gaps between technologies and capital investments. +65 6346 9132/6455 7322 www.cmtevents.com/aboutevent.aspx?ev=100306&

The RAI Exhibition and Congress Centre Amsterdam, Netherlands This event will provide leaders of the biofuels field an opportunity to meet new customers, suppliers and partners, and help drive innovation and business. More than 4,500 executives from 78 countries have attended this conference to date. +44 20 7099 0600 www.worldbiofuelsmarkets.com

5th International Congress Fuel Bioethanol-2010

2010 International Biomass Conference & Expo

April 13-15, 2010

May 4-6, 2010

Moscow World Trade Center Moscow, Russia More than 300 participants from 20 countries attended this event in 2009, making it the premier event for any organization involved in the rapidly maturing biofuels markets in the former Soviet Union. This event will be hosted by the Russian Biofuels Association, and presentations will include new process technologies and feedstocks, cellulosic ethanol, biobutanol and other second-generation biofuels. +7 495 585-5449 www.biofuels.ru

Minneapolis Convention Center Minneapolis, Minnesota This Biomass Magazine sponsored conference will unite current and future producers of biomass-derived power, fuels and chemicals with waste generators, energy crop growers, municipal leaders, utility executives, technology providers, equipment manufacturers, project developers, investors and policymakers. Future and existing biofuels and biomass power producers will be able to network with waste generators and other industry suppliers and technology providers as well as utility executives, researchers, policymakers, investors, project developers and farmers.

(701) 746-8385 www.biomassconference.com

2010 International Fuel Ethanol Workshop & Expo

Biomass ’10: Renewable Power, Fuels, and Chemicals Workshop

June 14-17, 2010 America’s Center St. Louis, Missouri The FEW provides the global ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-to-business environment. It is the largest, longest-running ethanol conference in the world. The event delivers timely presentations with a strong focus on commercial-scale ethanol production, new technology, and near-term research and development.

(701) 746-8385 www.fuelethanolworkshop.com

July 20-21, 2010 Alerus Center Grand Forks, North Dakota In its eighth year, this workshop offers a cutting-edge two-day technical program and exhibit show with national experts who focus on biomass production (plant matter such as straw, corn, and wood residue) and biomass conversion to power, transportation fuels and chemicals. The workshop will be geared toward industry, research entities, government, community and economic development corporations, financial institutions and landowners.

Topics will include trends and opportunities in utilizing biomass, renewable policies and incentives, renewable fuels, financing biomass-related projects, biorefinery chemicals and products, biomass for heat and electricity, biomass feedstocks, and algae.

(701) 777-5000 www.undeerc.org/biomass10

2010 Farm to Fuel Summit

Gasification Technologies 2010 Conference

August 11-13, 2010

October 31-November 3, 2010

Rosen Shingle Creek Orlando, Florida This fifth annual summit will be an opportunity for industry leaders and stakeholders to learn, network and strategize to advance the development of renewable energy in Florida. Florida’s Farm to Fuel Initiative was developed to promote the production and distribution of renewable energy from Florida-grown crops, agricultural wastes and other biomass. More than 500 attendees from academia, industry and government participated in last year’s summit.

(850) 488-0646 www.floridafarmtofuel.com/summit_2010.htm

Marriott Wardman Park Hotel Washington, D.C. The GTC is the largest gasification event in the world, attracting speakers and participants from the Americas, Europe, China and India. The GTC provides a single venue for participants to learn what is new in the gasification industry and why it is important. Speakers will address all aspects of the industry, from cutting-edge improvements in technology, through projects in development worldwide to updates on operations of plants based on coal, petroleum residues, biomass and secondary materials.

(703) 276-0110 www.gasification.org

8 BIOMASS MAGAZINE 3|2010

B PA

UPDATE Congress Should Support a Strong RES That Will Create Millions of New Jobs Congress is crafting a federal renewable electricity standard (RES) to help create new jobs in the renewable energy sector and help America reach energy independence. The Biomass Power Association is urging Congress to adopt a federal mandate for all states to produce at least 25 percent of their electricity from renewable sources such as biomass. It is time to create the legislative framework to move the U.S. away from foreign oil and other fossil fuels that have harmful effects on the environment, and create new green jobs in the process.

The RES-Alliance for Jobs, a coalition of businesses and organizations that support the congressional enactment of a strong RES, recently commissioned an economic analysis of the impact of a national RES of 25 percent. The Navigant study, released in February, concluded that a 25 percent RES by 2025 would result in the creation of an additional 274,000 renewable energy jobs nationwide and a cumulative 2.36 million job years of work.

The Navigant study is the first comprehensive analysis of potential jobs created specifically in the biomass power industry. For years, the southeastern region of the U.S. has resisted any type of renewable energy mandate because many southeastern states lack the wind and solar power necessary to meet those goals.

According to the study, however, the southeast region has the opportunity to create hundreds of thousands of jobs in clean, renewable biomass power under a 25 percent RES by 2025.

The study found that in the biomass power industry alone, more than 60,000 jobs would be created from 2009 to 2025 under a 25 percent RES. The majority of the jobs will be created in the eastern part of the U.S., where there is currently an abundant supply of biomass, but few biomass power facilities.

Legislation being proposed in both houses of Congress, unfortunately, does not go far enough toward meeting these goals. In fact, both the House and

Senate versions of the RES have almost no substantive effect on job creation and essentially maintain the status quo. An increase to a 25 percent renewable electricity mandate, however, would have a substantial positive impact on the economy, the environment and America’s longterm energy security.

Bob Cleaves The study also shows that any president and standard that falls short of 25 per- CEO, Biomass Power Association cent by 2025 will only have minimal positive impacts on the economy and the environment.

Instead of making meaningful investments in renewable energy technologies, states will look for loopholes and efficiency credits to meet low federal requirements.

The BPA fully supports steps toward increased efficiency, however, building a green energy economy and reducing our reliance on foreign oil requires a serious shift to American sources of renewable energy, such as biomass power, wind, solar, geothermal and others.

At a time of 10 percent unemployment, Congress should seize this opportunity to pass strong energy legislation that puts America on a new path toward energy independence built on domestic, clean, renewable sources of energy. The Navigant jobs study provides a clear guide to creating hundreds of thousands of jobs in the biomass power industry and outlines the significant economic benefits of an aggressive RES. The BPA and the RES-Alliance for Jobs will continue to urge Congress to support a meaningful mandate for renewable electricity of 25 percent by 2025.

The Navigant study can be found at www. res-alliance.org/res-jobs-study. BIO Bob Cleaves is president and CEO of the Biomass Power Association. To learn more about biomass power, please visit www.USABiomass.org.

3|2010 BIOMASS MAGAZINE 9

Visit www.biomassconference.com/southeast and: View interactive exhibitor map See conference sponsors and review sponsor benefits Register to attend Explore conference agenda And much more!

November 2 - 4, 2010 Hyatt Regency Atlanta Atlanta, Georgia

www.biomassconference.com/southeast

EERC

UPDATE Renewable Nitrogen Fertilizer Production U.S. agriculture is dependent on nitrogenbased fertilizers, and the U.S. fertilizer industry is dependent on natural gas as the primary source of hydrogen for reaction with nitrogen to yield ammonia. In 2003, more than 50 percent of U.S. ammonia was produced in Louisiana, Oklahoma, and Texas because of their large reserves of natural gas. Also in 2003, U.S. producers were second behind China in the production and consumption of ammonia, 90 percent of which was used for fertilizer. A fertilizer in its own right, ammonia is also the feedstock for production of urea, ammonium nitrate and other nitrogen fertilizers.

The cost of domestic natural gas typically accounts for at least 80 percent of the cost of ammonia—and by extension, the cost of all other nitrogen-based fertilizers. The volatile and high prices of domestic natural gas have resulted in a significant increase in fertilizer imports and a significant reduction in U.S. fertilizer production capacity.

One way to ensure against overdependence on imported fertilizer is to develop domestic fertilizer production capabilities in noncoastal regions that can compete with current import-based scenarios. Import-based fertilizer production includes the use of low-cost “stranded� natural gas; large-scale ammonia production via the highpressure, high-temperature Haber Bosch process; and long-range transport to U.S. farmers.

The Energy & Environmental Research Center at the University of North Dakota recently developed an electrolytic ammonia production process that replaces high-cost, high-purity hydrogen from natural gas with lower-cost mixtures of hydrogen and carbon monoxide derived from biomass gasification. Because it is driven by electricity and operates at significantly milder conditions than the Haber Bosch process, the EERC process offers the potential to directly utilize wind-generated electricity for ammonia production at significantly reduced capital and operating costs versus the Haber Bosch process.

In partnership with the North Dakota Corn Utilization Council, the Minnesota Corn Research and Promotion Council and the EERC Foundation, the EERC is developing the electrolytic ammonia production process for commercial applications. Ted Aulich Progress to date includes senior research manager, EERC development of a highly active and durable catalyst that enables ammonia production at ambient pressure and a temperature of 200 degrees Celsius (392 degrees Fahrenheit) versus typical Haber Bosch conditions of 3,000 pounds per square inch and 450 degrees C (842 degrees F). These milder process conditions translate to significantly reduced capital and operational costs, which will enable commercial production at smaller, more distributed scales than currently required for commercial viability. Distributed-scale production means that plants could be located closer to the farmland where it is being applied, drastically cutting transportation costs.

Based on progress made to date, the EERC is targeting an ammonia production cost of $300 per ton. Once the technology is fully commercially competitive, ammonia production targets would result in lower-cost fertilizer; support domestic fertilizer production; enable extracting value from wind energy without the need for major expansion of expensive, difficult-to-permit transmission capacity; provide a means to potentially lower the carbon footprint of ammonia production using renewable power and feedstocks; and promote rural economic development on the wind- and agriculture-rich Great Plains. BIO Ted Aulich is a senior research manager at the EERC. Reach him at taulich@undeerc.org or (701) 7772982.

3|2010 BIOMASS MAGAZINE 11

LEGAL

perspectives

Creditworthiness Key to Biomass Project Success

By John Eustermann John Eustermann partner, Stoel Rives LLP

M

ost biomass projects require the developer to raise large amounts of finance well in advance of breaking ground, let alone commercial operation. Although the debt markets are expected to rebound and the implementation of multiple state and federal financial incentives and capital sources have some saying they already see things opening up, arranging finance for a renewable energy project is not easy, and the route adopted to raise finance has a major bearing on how the project will be developed.

It is therefore important that, at an early stage, consideration is given to the available financing options.

The push for renewable energy and the green economy combined with the multiple grants, guarantees, bonds and other stimulus programs and facilities have resulted in many options for biomass facility developers to consider when layering up their financial model.

Though the applications and requirements differ from option to option, they share one threshold requirement: creditworthiness.

Creditworthiness is a creditor’s measure of the project company’s ability to meet its debt obligations. The financial markets must get comfortable with their ability to rely on the project to generate a predictable stream of cash flow necessary to ensure repayment of their loans. Investment grade rated projects are projects that have contractually sound cash flows.

Such cash flows are the result of well negotiated through-put and development agreements that form the basis of the lender’s security structure, credit analysis; hence underpinning the projects ability to get financed. For biomass projects, the contracts and high level considerations for purposes of credit analysis are as follows:

Fuel Supply Agreement: Financiers will generally require the term of a fuel supply contract to exceed the term of the debt by a reasonable margin (ideally two or three years) or have the term align with or be no less than the tenor of the power purchase agreement (PPA).

The contract will specify the price, amount and characteristics of fuel to be delivered on a daily, monthly and annual basis. Further, appropriate escalators will be negotiated and the developer should be cognizant of and seek to control how such price adjusters are triggered and the effect they will have on cash flows over the term of the agreement. Finally, the counterparties (the fuel/ waste suppliers) will be expected to be creditworthy entities with access to assured sources of fuel/waste over the term of the contract. As a part of this upstream component of project development, the developer is wise to engage the services of an expert in feedstock supply analysis and modeling.

Engineering, Procurement and Construction Agreement: Often a creditworthy contractor will undertake to carry out design, engineering, procurement and construction on a fixed-price, turnkey basis. The desire is to have the contractor assume “single point” responsibility for the overall construction of the project. The contract will contain completion tests and liquidated damages, which will be payable if the tests are not met by the specified date.

The debt markets will likewise require bonding or external guarantees to support the obligations of the turnkey contractor (eg: to ensure ability to perform and pay liquidated damages).

If more than one contractor assumes the EPC responsibilities, the development of the project in this regard becomes more complex. In such instances, lenders will require that the respon-

sibility for each separate point is clearly delineated. Furthermore, risk allocation, insurance, and warranties will be more complex.

Operating Agreement: The operation of the plant is another key consideration of the lending community and will be required to be carried out by a company or entity with an appropriate track record of successful operation of similar facilities deploying the same technology. This is, of course, more important to technologies where operation is more complex.

Typically, operating agreements will provide for reimbursement of costs plus an incentiverelated performance fee. Lenders and the developer will want the ability to terminate such an arrangement in case of poor performance.

Power Purchase Agreement: The PPA is the cornerstone of the biomass project. The power purchaser, more than other project counterparties, must be creditworthy. Lenders will want the contract term to extend beyond the term of the loan. The contract will be assessed by the lenders for its economics and conditions that might cause early terminations—lenders will want the ability to cure any defaults rather than face termination.

Rigorous conceptual analysis and planning must go into the structuring of the contractual arrangements of any biomass project and the underlying consideration in all instances for the developer should be the creditworthiness of the project. The wise developer should view all material contracts, terms and decisions through the eyes of a potential creditor.

John Eustermann is a partner with Stoel Rives LLP. Reach him at jmeustermann@ stoel.com or (208) 387-4218.

3|2010 BIOMASS MAGAZINE 13

business

BRIEFS ScottMadden, Ascendant Partners join forces Consulting companies ScottMadden Inc. and Ascendant Partners Inc. have joined forces to help renewable energy companies secure project financing. The companies are qualified to assist energy organizations in preparing U.S. DOE and USDA loan guarantee and grant applications for renewable energy projects, as well as to help them oversee the project management once funding is secured. The firms have developed detailed methodologies, templates and work plans for each of the DOE and USDA funding mechanisms, which eliminates the guesswork and errors while significantly improving the efficiency of the process. BIO

Mascoma appoints Brady CEO Mascoma Corp. appointed William J. Brady as its CEO. He will also join the boards of directors of Mascoma and Frontier Renewable Resources LLC. Prior to joining Mascoma, Brady served as executive vice president and general manager of several operating divisions at Brady Cabot Corp., where he led business units from technical development through commercialization, and managed global capital-intensive businesses and developed strategic relationships with large global customers. Brady will help Mascoma achieve technical and commercial milestones, including continuing to reduce costs for ethanol produced from cellulosic feedstocks, develop additional partnerships for its commercial-scale ethanol project in Kinross Township, Mich., and create strategic joint ventures to commercialize Mascoma’s proprietary Consolidated Bioprocessing technology for production of advanced biofuels and chemicals. BIO

Laidig, Tank Connection team-up Laidig Systems Inc. has teamed up with Tank Connection Affiliate Group to address the growing needs in storing and reclaiming difficult-to-handle dry bulk materials. In biomass and hot grain meal storage applications, both companies will focus on bulk storage facilities. Tank Connection’s rolled, tapered panel (RTP) bolted tank and Fusion coating system is recognized as the top rated, bulk storage tank/system available.

Bolted RTP construction is easily containerized and installed globally, utilizing a specialized hydraulic screw jack process. This tank construction process allows crews to install large tanks at grade level, which is safe and provides effective quality control in the field, and will allow Laidig to install its premier reclaim storage systems at any location worldwide. BIO 14 BIOMASS MAGAZINE 3|2010

BinMaster introduces BinLink Web-based bin monitoring BinMaster Level Controls, Lincoln, Neb., introduced BinLink, a Web-based monitoring solution for bins, tanks and silos that enables remote wireless inventory management of stored material from any computer connected to the Internet anywhere in the world. The core components of the solution are BinMaster’s SmartBob2 and SmartBob-TS1 sensors mounted on the bins, a wireless or wired data communications network, a gateway to provide connectivity to a personal computer or Internet Protocol network, and data collection software that can be viewed by any authorized individual via an Internet connection. BinLink eliminates the need to manually check bin levels, saving time, money and manpower and improving the efficiency of ordering and logistics for all types of operations. BIO

GTE names Grant as new chairman Gas Turbine Efficiency, an energy and aviation products and services company, has appointed John Grant as the company’s nonexecutive chairman. Grant brings a strong executive management profile to GTE, following his work in the engineering and automotive industries in the U.S. and the U.K. Prior to joining GTE, he served as chairman of Torotrak plc and as non-executive director of Pace plc, Melrose plc and MHP SA, which are all listed on the London Stock Exchange. Grant’s career started at Ford Motor Co. in 1967, where he progressed through the ranks to achieve executive management positions in Europe and the U.S., until his departure in 1992. BIO

ADF Engineering’s Williamson, Hery pass exams ADF Engineering Inc., with corporate headquarters in Miamisburg, Ohio, announced that Matt Williamson and Beth Hery recently passed the Ohio Professional Engineer exam in chemical engineering.

Williamson is a process department manager and has been with ADF Engineering since May 2008. Hery is a senior process engineer and has been with ADF Engineering since 2005. ADF Engineering is a full-service engineering and consulting firm serving the food, feed, fuel and bioscience industries in the U.S. and Canada. BIO

Williamson

Hery

business

BRIEFS Stern Brothers to secure financing for SynGest’s bio-ammonia project SynGest Inc. announced that the company has engaged Stern Brothers & Co. to raise capital for its first biomass-to-ammonia plant in Menlo, Iowa. After the Iowa project is launched this year, SynGest intends to build similar fertilizer mini-plants in other parts of the country. Discussions regarding emerging opportunities are presently underway with interested parties in Ohio, Oregon, Michigan and Minnesota. Stern Brothers has a national practice in renewable energy finance representing public and private company developers and operators seeking nonrecourse project financing in the biomass-to-fuels and chemicals, ethanol, biodiesel, methane gas and biomass-to-energy sectors. BIO

Evolution Resources signs agreement with NCSU Evolution Resources, an advanced biofuels production company that produces cellulosic ethanol, has signed a testing services agreement with North Carolina State University. NCSU will work with Evolution Resources as per the agreement to test and bring about improvements in the current laboratory-scale technology within a bigger pilot-scale system. The technology deals with the enzymatic carbohydrate conversion of woody biomass to fermentable sugars. BIO

Ceres provides online biopower calculator Energy crop company Ceres Inc. has posted a footprint calculator on its Web site to help electric power producers determine the acres needed to support various-sized biomass-to-power projects. One of the largest renewable resources, biomass can be cofired with coal at existing generating stations or used by large industrial facilities for on-site heat and power. The online tool from Ceres allows users to adjust biomass yield per acre and land usage rates, as well as biomass-fired capacity and heat rate, a measure of efficiency. The calculator can be accessed at www.ceres. net/biopower. BIO

Morbark, Strongco form Western Canada alliance Morbark announced the signing of a dealership agreement with Strongco Limited Partnership in Western Canada. With Strongco’s five locations in Alberta, Morbark customers in Western Canada now have convenient access to equipment, service and sales. Strongco, in business for more than 50 years, is one of the largest multi-line industrial equipment distribution providers in Canada, providing service in Calgary, Red Deer, Edmonton, Fort McMurray and Grande Prairie. Strongco sells, rents and services mobile industrial equipment in the construction, road building, mining, forestry, utilities and municipal sectors of the economy. It also represents several leading equipment manufacturers, including Volvo, Dressta and Manitowoc. BIO

ClearFuels adds BNP Paribas to its commercial development team ClearFuels Technology Inc. has executed a letter of engagement with BNP Paribas to act as financial advisor to assist and support ClearFuels in securing senior secured debt financing for its commercial biorefinery projects. The agreement calls for BNP Paribas to assist and support ClearFuels with the analytical work and due diligence regarding ultimate debt financing for ClearFuels’ commercial projects. These services would be directed, in part, to create financing plans for the commercial projects. BIO

Qteros names McCarthy president and CEO Qteros Inc. announced that John McCarthy has joined the company as president and CEO to accelerate its technology and commercial initiatives in the worldwide cellulosic ethanol marketplace. McCarthy’s 18-year experience includes managing the transformaMcCarthy tional growth of numerous life science and biobased chemical companies into high-value commercial entities.

He has raised more than $1 billion of capital in the private and public markets, and developed and executed numerous complex and largescale strategic corporate partnerships. He joined Qteros from Microbia Inc., where he served as chief business officer of this developer of unique biobased specialty chemicals for large-scale industrial applications. Prior to Microbia, McCarthy was executive vice president of Verenium Corp. BIO

Genencor receives 2009 New Product Innovation Award Genencor, a division of Danisco A/S, is the recipient of the Frost & Sullivan 2009 New Product Innovation Award for Biomass Enzymes. The award was granted for Genencor’s Accellerase, a product line of enzymes used to convert biomass into sugar, a critical step in the production of cellulosic ethanol and other advanced biofuels and biochemicals. According to Frost & Sullivan, the Accellerase product line provides feedstock and pretreatment flexibility, better process economics, accessory products and versatility, which are all significant advantages that makes it stand out from the competition. BIO

3|2010 BIOMASS MAGAZINE 15

BIObytes Biomass News Briefs

Upflow Anaerobic Sludge Blanket System

Partnership will develop algae production models

Cheese plant installs wastewater treatment, digester Veolia Water Solutions & Technologies Co. subsidiaries Biothane LLC and N.A. Water systems LLC have begun work installing an advanced wastewater treatment system at The Holmes Cheese Co. in Millersburg, Ohio, which will employ an anaerobic digestion technology to help reduce energy costs. Biothane’s Upflow Anaerobic Sludge Blanket system first passes wastewater through a pretreatment and conditioning tank where it is prepared for main treatment. It is then supplied via an influent distribution system on the UASB reactor ground, rising through a bed of granular biomass (sludge bed) where the treatment takes place.

At the top, a three-phase settler separates the treated water from biogas and granular biomass, and water and biogas are drawn off separately while the granular is returned to the sludge bed.

Alliance brings Austrian products to US Austrian-based AAT Abwasser’s biogas division and BioEnergy Technologies LLC, Sumter, S.C., have formed a strategic alliance that will establish BioEnergy as the sole representative for AAT’s biogas technology in 44 states in the U.S. AAT has more than 26 years of experience in anaerobic digestion technology, with more than 100 plants in operation in Europe and one in Oregon that came on line this past

16 BIOMASS MAGAZINE 3|2010

summer, according to Christian Kloser, AAT America managing director. BioEnergy Technologies, a renewable biomass energy provider, builds and operates decentralized facilities on-site at farm and processing locations, generating biogas that is converted to power, and also can provide a source of chilled water, hot water or steam to the host facility, according to BioEnergy Technologies.

California-based OriginOil Inc., which has developed a technology to transform algae into a competitor for petroleum, has formed a partnership with London-based StrategicFit, a strategy consulting firm with world-class analytical capabilities.

The partnership will focus on increasing the robustness of OriginOil’s core algae productivity model by refining underlying assumptions and process logic,

according to OriginOil. The lifecycle model will be the starting point for the project, as it shows that a properly sited industrial algae production system could be both profitable and beneficial, according to OriginOil. The knowledge and experience of StrategicFit will help OriginOil identify key opportunities and challenges involved in commercializing its technology platform.

Arizona landfill gas project on line The Glendale, Ariz., Energy Power Plant, a 2.8-megawatt biogas plant in the city of Glendale’s municipal landfill, is now on line and serving customers of utility company APS. A dedication ceremony for the plant was held at the end of January, followed by “Lunch at the Landfill,” which was open to the public. The project uses large combustion

engines to turn a shaft connected to a generator, producing electricity from the landfill’s methane emissions. APS has a power purchase agreement with Glendale Energy LLC. This is APS’ first biogas project, but its renewable energy portfolio includes solar, wind, geothermal and biomass, together serving about 60,000 households.

Excel Energy contracts Missouri firm Missouri-based engineering, architecture and consulting firm Burns & McDonnell will perform engineering services, procurement and construction support services for the design and installation of a biomass gasifier at Xcel Energy’s Bay Front Power Plant in Ashland, Wis. The company will assist Xcel in converting the last of three coal-fired boilers to a waste-

wood feedstock, including wood left behind in logging operations and forests, according to Burns & McDonnell. Engineering and design technology evaluation is underway on the 73-megawatt plant and construction is slated to begin in 2011, with operation in 2012. Burns & McDonnell will review and finalize project costs, as well.

AURI receives $99,000 USDA grant

Covanta Acquires Veolia’s NA energy-from-waste business

Minnesota’s Agricultural Utilization Research Institute has been named recipient of a $99,000 award administered through the USDA Rural Development Business Enterprise Grant program, in order to provide technical assistance to small and emerging businesses in the biomass processing industry in Minnesota.

AURI, a non-profit orga-

Covanta Holding Corp. announced that it has successfully completed its previously announced acquisition of a 3,000 ton per day operating contract in Miami-Dade County, Fla. Completing this final stage of the acquisition of Veolia Environnement’s North American energy-from-waste business enhances Covanta’s position as a leader in the development,

nization that works to develop innovative uses for agricultural commodities, will distribute the funds throughout seven counties in the state for use as start-up capital loans, building and plant renovations, transportation improvements, project planning and other relevant business needs.

ownership and operation of energy-from-waste facilities.

The businesses acquired from France’s Veolia consist of the operating contracts associated with six energy-from-waste businesses; ownership and operation of a seventh facility in Montgomery County, Pa., and one transfer station, also located in Pennsylvania.

Partnership brings biomass power to Philippines National Power Corp. and Clenergen Corp. will collaborate in generating electricity from biomass for NPC’s Small Power Utilities Group in the Philippines. NPC is the Philippine government’s mandated state agency to develop off-grid nonconventional island power systems. Together, the organizations will pursue feasibility studies for the nominated areas: Kabugao, Kalinga, Lubuagan, Apayao, Concepcion, Romblon, Corcuera and Banton, according to Clenergen. NPC believes those areas have the best potential for developing competitive

Philippines

renewable energy. Clenergen will install distributed environmental power systems in the chosen areas, ranging from 0.5

megawatts to eight megawatts, according to the company. The Philippines is an excellent platform to demonstrate biomass

and gasification technologies to assure renewable electricity for the Asia Pacific Basin, Clenergen CEO Mark Quinn said.

3|2010 BIOMASS MAGAZINE 17

industry

NEWS Spanish cellulosic ethanol producer Abengoa Bioenergy has teamed up with Mid-Kansas Electric Co. LLC to develop a cellulosic ethanol and power plant in Stevens County, Kan., to produce 15 MMgy of ethanol and 75 megawatts (MW) of power per year.

Abengoa Bioenergy Hybrid of Kansas (ABHK) will utilize locally available biomass resources such as corn stover, wheat straw and switchgrass as feedstocks, procuring them from farmers/producers in seven counties within a 50-mile radius of the plant. ABHK will require about 2,500 tons of biomass per day, or the equivalent of about 130 truckloads, according to Chris Roach, ABHK project development manager.

Once the biomass materials are harvested into package form, they will be transported via flat-bed trailer to the nearest satellite depot. An estimated 80 percent of the biomass packages will go from the field to a satellite depot for storage and then to ABHK; the rest will be transported directly from the field to the facility, according to the companies.

An extensive investigation of biomass availability determined that there will be a sufficient quantity of feedstock to meet demand. Clare Gustin, vice president of Mid-Kansas Electric Co. Member Services & External Affairs, said the facility would require only about 10 percent of the biomass residues available within 50 miles of ABHK. Roach told Biomass Magazine that contracting for the materials has already begun.

The projected cost of construction is $550 million, which will be funded by equity provided by Abengoa Bioenergy, a grant of $76 million from the U.S. DOE to support the commercialization of Abengoa’s cellulosic ethanol technology and additional financing through a lender or similar entity.

“The significance of this announcement is that the power purchase agreement gives Abengoa Bioenergy a 20-year contract to ‘take to the bank’ for financing,” Gustin said. The electricity produced at the

PHOTO: ABENGOA BIOENERGY

Abengoa partners for Kansas ethanol/power plant

Corn stover will provide approximately 76 percent of the biomass feedstock at the ABHK facility.

site will serve the retail customers of Mid-Kansas Electric located in 34 counties in the state.

The next step in developing the project will be for Abengoa Bioenergy to obtain an air permit from the Kansas Department of Health and the Environment and prepare an Environmental Impact Statement in compliance with the National Environmental Policy Act. Roach said project construction is slated to commence late 2010; completion is targeted for 2012.

Beyond ABHK, Abengoa currently owns two ethanol production facilities in Brazil, and recently completed construction of and is in the process of starting up two facilities in Indiana and Illinois.

—Anna Austin

Construction job fair In Texas attracts hundreds A job fair in Nacogdoches, Texas, in search of construction workers for a biomass power plant resulted in about 330 completed job applications and almost as many job interviews, according to Bill King, president and CEO of the Nacogdoches Economic Development Corp.

NEDC held the fair in conjunction with Fagen Inc., which is managing construction of the 100-megawatt Nacogdoches Power LLC plant near Sacul, Texas. About half of the job fair attendees came from Nacogdoches County, King said, the rest traveling from elsewhere. “Job opportunities like this attract people from a pretty good distance,” he said. The county has been fortunate in experiencing a fairly lower unemployment rate—about 6.2 percent—than surrounding areas, he added. “Housing and construction have been hit pretty hard by this recession.”

During the 2 1/2-year construction period, about 200 to 300 18 BIOMASS MAGAZINE 3|2010

workers will be needed at all times, King said, adding that he expected the job fair to attract about 200 people. Many prospective workers have also filled out online applications on Fagen’s Web site (www.fageninc.com). Since the fair was announced, King has seen substantial interest in it and the available positions. “We’re getting calls from all over the place,” he said.

The plant will occupy 165 acres and will run on about 1 million tons annually of biomass such as forest residue, wood processing residue and clean municipal solid waste from a 75-mile radius, according to Fagen. A 20-year power purchase agreement has been reached with utility Austin Energy, which serves Austin, Texas. The $400 million facility is slated for operation in the summer of 2012.

—Lisa Gibson

industry

NEWS Obama takes steps to boost bioenergy

The biofuels and biomass industries received nothing but good news Feb. 3, with the release of the long-awaited renewable fuels standard (RFS2) final rule, the first report generated by President Barack Obama’s Biofuel Interagency Working Group, and the Biomass Crop Assistance Program proposed rule.

U.S. Secretary of the Interior Ken Salazar, Agriculture Secretary Tom Vilsack, Energy Secretary Steven Chu, U.S. EPA Administrator Lisa Jackson and Assistant to the President for Energy and Climate Change Carol Browner participated in a conference call to discuss the energy announcements following a meeting with President Obama, Vice President Joe Biden, and a bipartisan group of governors from across the country.

During the conference, Vilsack pointed out that historically, government agencies such as the USDA and EPA have been duplicating efforts for similar but different energy-related projects, rather than collaborating. The first task force report encourages interagency cooperation, he said, while clearly delineating responsibilities in order to concentrate and leverage resources.

The report also recognizes that one size does not fit all, Vilsack added. “So every region in the country will able to participate in a biofuel future to create jobs and economic opportunity, particularly in rural communities,” he said. Obama’s fiscal year 2011 budget will develop five regional feedstock research and demonstration centers that will partner universities, industry and other federal and state agencies, tribal nations and internationals, to accelerate research and development in second- and third-generation feedstocks, and the implementation of a supply chain that will allow the U.S. to get new biofuels to market as quickly and efficiently as possible.

“One issue we face in connection with promoting biofuels is encouraging production of feedstocks,” Vilsack said. “So many [people] have been waiting for the proposed rule as it relates to the BCAP program. We believe [BCAP] is an essential component to our national biofuels and renewable energy policies, and needs to be designed to reduce financial risks for farmers, ranchers and forest landowners who want to invest in and establish production of nonfood, nonfeed biomass. BCAP will address the ‘chicken or egg’ dilemma that has stalled biomass growth in this sector, and we believe we have fashioned a rule that has sufficient flexibility to ensure technology neutrality. Cellulosic feedstocks, woody biomass, energy cane all need to be and will be explored with the BCAP rule.”

Vilsack also said the interagency group believes the rule addresses concerns expressed by the wood industry, by proposing a prohibition on wood waste and residues not just on federal land

but also nonfederal land, that otherwise might be used for higher value products. “We’re also putting forward a number of alternatives for matching payments to biomass suppliers to make sure that those funds are targeted to biomass that contributes to an increase in the base line use among current biomass conversion facilities,” he said. “The public has 60 days to comment on the proposed rule, and we will incorporate those comments into the final rulemaking process.”

Jackson discussed the changes to the RFS2 ruling, while ensuring it will create many new jobs, particularly in rural areas that have been hit hard by the economic depression, and also help farmers by creating new markets for agricultural products. She estimated the rule will result in an annual $13 billion increase in income for U.S. farmers by 2022.

The RFS2 is an effort to reduce greenhouse gases (GHG), Jackson said, and there has been reasonable worry that with the life-cycle impacts of switching to renewable fuels there may not be reductions of GHGs, or that even more carbon emissions may be generated. “To address those worries, the EPA used the soundest available science that has evolved in response from questions and concerns from a number of stakeholders, and employed a full lifecycle analysis to track GHG emissions for biofuels production and use including land use issues,” she said. “Using this, [with RFS2] we’ve estimated a reduction of carbon emissions to the equivalent of taking 27 million cars off the road annually by 2022.”

Jackson concluded by emphasizing that the interagency group wants to send a positive, specific and direct message that the Obama/Biden administration is highly supportive of the biofuels industry, sees a tremendous opportunity for growth and expansion of that industry, and is committed to making it happen.

Novozymes, a company that develops enzymes and is currently building a production facility in Nebraska, applauded the government for its efforts to expand ethanol production. “The new commitment made by President Obama will significantly help grow and advance development of biofuels in the U.S., and at the same time create thousands of new green jobs,” said Steen Riisgaard, CEO of Novozymes. “The new RFS2 is a strong framework and by moving to E15 and increased accessibility of E85, the biofuel industry can create more long-lasting, high earning jobs that will help transform the way the U.S. and world use and consume fuel. And at the same time lessen U.S. dependence on foreign oil.”

—Anna Austin

3|2010 BIOMASS MAGAZINE 19

industry

NEWS

20 BIOMASS MAGAZINE 3|2010

EcoTrac’s biomass-based fertilizers enhance tree growth.

PHOTO: ECOTRAC ORGANICS

Fertilizers produced from mostly pine tree biomass by Washington-based EcoTrac Organics have been shown to enhance growth in conifers and pine trees, and can reduce water requirements of treated lawns and plants, according to the company.

Since its establishment in 2007, the company has sought to manufacture and market environmentally friendly products and has come up with three so far, with some patents pending. The first, HyperGrow, is a pine tree-derived biomass fertilizer. It is composed of pine tree sawdust and wood ash from biomass cogeneration processes, according to Jim Lodwig, EcoTrac president. It enhances growth rate, specifically in conifers. HyperGrow is primarily used in applications where the plants require lower levels of nitrogen.

The second product is HyperGrow Plus, which is manufactured using various timber and agricultural waste residues, without adding any synthetic components, Lodwig said. The product is made from 100 percent natural, organic plant and crop waste and replaces some components used in HyperGrow with others that enhance nitrogen content in the fertilizer. HyperGrow Plus is low in phosphate so it’s ideal for municipal use, as many cities have created ordinances requiring fertilizers used in golf courses and public parks to be low in phosphorous to reduce the possibility of contaminating the groundwater, according to Lodwig. The product also contains wood ash and sawdust, but does not exclusively contain pine tree or softwood sawdust, according to EcoTrac. Sawdust gives the fertilizer fiber to keep it from leeching through the soil post-application and bypassing the roots of crops and grasses before they can absorb the nutrients. The company obtains sawdust and lumber yard waste for its products from various local lumber mills.

HyperGrow and HyperGrow Plus share beneficial traits for trees, crops, gardens and lawns, such as enhanced growth, replenished fiber in the soil profile, and the increased benefits of that fiber, according to the company. HyperGrow Plus can be applied during the seeding process and is currently being tested by farmers in Washington and Idaho.

EcoTrac’s third product, Traction Plus, is a traction aid additive for winter highway maintenance sand and is also made from pine tree biomass. It blends with sand and immediately adheres to compact snow and ice, minimizing the scatter upon application and keeping sand in place longer under traffic conditions, according to Lodwig. Traction Plus also minimizes dust pollution from excessive sand use and fertilizes the areas surrounding the highways.

EcoTrac is working with Stimson Lumber, the Idaho Forest Group and Colville Indian Precision Pine, among others in the Northwest region of the U.S., to secure lumber processing waste for its products. Raw byproducts are blended and pelletized at West Oregon Wood Products, according to EcoTrac.

The market potential for EcoTrac’s products seems to be substantial, including timber companies, landowners, homeowners, park managers or any entity that plants trees for consumption or beautification,

PHOTO: ECOTRAC ORGANICS

Fertilizers from biomass enhance growth

HyperGrow Plus is made with timber waste and agricultural residue.

according to the company. EcoTrac expects future markets will include retail consumer applications of its formulas.

The company will continue to research new formulas and different additives for various applications and will investigate new compatible resources for its current products, such as forest slash, according to Lodwig. EcoTrac is also conducting trials using HyperGrow Plus in conjunction with a seed starter called HyperPlantStart, which gives seeds a healthier, stronger start to increase yield potential and reduce the need for chemical applications. The combination gives plants both a pre-emergence boost and a post-emergence growth advantage, according to the company.

—Lisa Gibson

industry

NEWS A study recently published by Michigan State University has found that diverse biomass crop plantings such as switchgrass and native prairie grasses attract a higher number of beneficial insects than nondiverse crops such as corn.

The purpose of the study was to assess the implications of different biofuel crops for beneficial insects —pollinators and pest controllers such as bees—that provide valuable ecosystem services in agricultural landscapes. MSU entomology professor and study co-author Doug Landis said existing plantings throughout southern Michigan that were not actively being managed as biofuel crops were sampled, and it was found that the crops contained a diverse bee community comprised of 75 species. Overall, bees were three to four times more abundant in switchgrass and prairie grass than in corn.

The study suggests that there are important consequences for the insects in the type of biofuel crop that is grown. Results indicated that as an annual crop with low plant diversity and high levels of soil disturbance, corn tends to have low abundance and diversity of these beneficial insects. By contrast, both perennial grassland-based biofuel crops harbored a higher abundance, species richness, and diversity of beneficial arthropods compared with corn monocultures, according to the study.

The researchers believe their findings suggest important policy implications. Particularly, on U.S. government policies toward cellulosic biofuels being driven by ethanol production targets that influence research focused on attaining high biomass productivity and corresponding efficiency in processing, without explicit consideration of the landscapelevel environmental impacts such systems may induce.

Landis told Biomass Magazine that a caveat he and his team have is that as these crops are “pushed” for higher yield that diversity will

PHOTO: MICHIGAN STATE UNIVERSITY

Study: Biomass crops attract beneficial insects

Landis and a team of Michigan State University researchers have found that diverse biomass crops attract more beneficial insects than nondiverse crops.

likely decline. Future bioenergy policy should be developed to explicitly enhance biodiversity as a means of improving the delivery of ecosystem services by agricultural landscapes, they contend, while also meeting biofuel production targets.

Funding for the study, published in January in the BioEnergy Research Journal, was provided by the U.S. DOE Great Lakes Bioenergy Research Center, the Michigan Agricultural Extension Station and the USDA National Research Initiative program.

—Anna Austin

Bill will boost biomass in Wisconsin Wisconsin biomass advocates are requesting active support from the public to secure the passage of Gov. Jim Doyle’s Clean Energy Jobs Act (SB450 and AB649), which was introduced in early January.

The bill, which largely endorses biomass energy, will increase the use of renewable energy, energy efficiency and cleaner fuels in Wisconsin.

“The legislation provides multiple benefits for biomass energy systems and for the first time, introduces measures to encourage the most efficient use of biomass in heating and cogeneration,” said Peter Taglia, staff scientist for the environmental advocacy organization Clean Wisconsin.

The provision is part of an enhanced renewable portfolio standard (RPS), he added, which would credit biomass thermal applications from cogeneration and biogas injected into the natural gas pipeline, providing additional opportunities for farms to install anaerobic digesters at locations where the cost to install electric generators or transmission isn’t feasible. The section also proposes allowing utilities to count the heat produced from biomass cogeneration toward the RPS, and improves the calculations used to determine the energy produced from biomass cofiring and biomass cogeneration facilities, according to Taglia.

Wisconsin’s current RPS targets the increase of renewable energy in the state to 10 percent by 2010 and the proposed bill would expand

the RPS to 25 percent by 2020. In addition, all state agencies would use biomass to provide 25 percent of their energy use by 2025.

Among provisions that would benefit the production of local biomass resources is a Biomass Crop Reserve Program, which would award contracts to farmers to plant native perennial plants to sell for bioenergy production. Taglia said this program would help solve the “chicken-andegg problem” of jump-starting the homegrown fuels market, and make Wisconsin more competitive to receive funding through the USDA’s Biomass Crop Assistance Program.

Taglia said proponents of the bill hope to get it passed and signed into law before this legislative session ends in mid-May. Clean Wisconsin is requesting letters of support for the bills from the public, which may be submitted at http://cleanwisconsin.e-actionmax.com/takeaction. asp?aaid=297.

A public hearing to discuss details of the bill was held at the State Capitol building in February. For an overview of SB450 and AB649, go to www.legis.state.wi.us/lc/publications/climate/index.htm.

—Anna Austin

3|2010 BIOMASS MAGAZINE 21

industry

NEWS RFS2 reduces 2010 cellulosic ethanol requirement

The new requirement for cellulosic biofuel production in 2010 is reduced to 6.5 million ethanol equivalent gallons in the renewable fuels standard (RFS2), down significantly from the 100 million gallons established in RFS1, included in the Energy Policy Act of 2005. The U.S. EPA released final RFS2 rules Feb. 3 as media outlets, producers and others scrambled to find out how it would affect their industries.

While the required total volume of renewable fuels produced this year remains the same at 12.95 billion gallons, changes within the requirements for different types of fuels are drastic. Good news came for the biodiesel industry, as the requirement for a new biomass-based diesel program jumped to 1.15 billion gallons, a combination of standards for 2009 and 2010, to be applied in 2010.

The advanced biofuel requirement remains the same at 950 million gallons.

The new cellulosic biofuel standard is based on an updated market analysis that considers detailed information from pilot and demonstration-scale plants, an Energy Information Administration analysis, and other public and private market information, according to the EPA. While 6.5 million shows a drastic reduction, a number of companies appear poised to expand over the next several years, it added.

“We see it as a positive change,” said Jennifer Hutchins, spokeswoman for DuPont Danisco Cellulosic Ethanol, which opened a demonstration plant in Vonore, Tenn., at the end of January. “As a leading player in cellulosic ethanol, we’re glad the standard has changed. Obviously, the industry wasn’t going to meet that 100 million-gallon mandate.” The plant runs on corncobs now, but will transition to 100 percent switchgrass over the next year.

“I think it’s a great change,” said Arnold Klann, CEO of California-based BlueFire Ethanol Fuels Inc., which focuses on producing cellulosic ethanol from waste. “It was very clear our industry couldn’t meet the standard set for this year.” He added that the new goal is easily achievable and was a good decision.

Fortunately, changes to the greenhouse gas (GHG) modeling mean all classes of biofuels meet the RFS GHG reduction goals.

According to the RFS2 life-cycle greenhouse gas analysis, ethanol from switchgrass reduces GHG emissions by a stunning 110 percent through biochemical conversion and 72 percent through thermochemical processes. That was no surprise to DDCE. “We have known about the greenhouse gas reduction potential of switch-

22 BIOMASS MAGAZINE 3|2010

grass,” Hutchins said. “That’s one of the reasons we work with it.” Ethanol from corn stover reduces emissions by 130 percent through biochemical conversion and 93 percent thermochemical.

That means both meet the 60 percent GHG reduction requirement in EISA for cellulosic biofuels.

Ethanol from sugarcane also meets the standard, reducing GHG emissions by 61 percent. “EPA’s reaffirmation of sugarcane ethanol’s superior GHG reduction confirms that sustainably produced biofuels can play an important role in climate mitigation,” said Joel Velasco, chief representative in Washington for the Brazilian Sugarcane Industry Association.

Biomass-based diesel must meet a 50 percent reduction standard to qualify for the RFS2. The National Biodiesel Board welcomed the RFS2, specifically the implementation of the biomassbased diesel program, which will help America reap existing benefits in job creation, energy security and the environment, according to Joe Jobe, NBB CEO. The EPA also mentioned five categories of feedstock that are expected to have less or no indirect land use changes, including crop residues such as corn stover, wheat straw, rice straw, citrus residues; forest material such as eligible forest thinning and solid residue remaining from forest product production; secondary annual crops planted on existing crop land; separated food and yard waste; and perennial grasses including switchgrass and miscanthus.

The RFS2 lays out the strategy for reaching the goal of using 36 billion gallons of renewable fuel by 2022. Currently, the country is not on track to meet that goal, as only about 12 billion gallons of biofuels are produced annually.

“We welcome the commitment of the president to continue growing the domestic ethanol industry,” Poet LLC CEO Jeff Broin said. “He correctly noted that producing home-grown ethanol creates jobs in America at a time America most needs them. However, we are concerned that some pieces of the rules put out by EPA today run contrary to that stated effort. Although the international indirect land use change penalty has been lessened somewhat, EPA still relied on the disproven theory when all of the data shows that ethanol production continues to improve and isn’t requiring new land.” South Dakota-based Poet produces corn-based and cellulosic ethanol from corncobs.

—Lisa Gibson

industry

NEWS Mitchell plant conversion delayed for EPA ruling

The conversion of Georgia Power’s Mitchell Generation Plant to biomass feedstock has been delayed, awaiting a U.S. EPA ruling on the industrial boiler Maximum Achievable Control Technology (IB MACT) rule.

The rule would regulate emissions of hazardous air pollutants such as certain acid gases, organics, metals and others from industrial boilers. It will likely affect biomass boilers like the one planned for Plant Mitchell, near Albany, Ga., according to Georgia Power Spokeswoman Lynn Wallace. “Our intent was always to convert this boiler with the understanding that we’re meeting the EPA rules,” she said, adding that undetermined rules make that difficult.

The plant operates now on coal, generating 155 megawatts.

When converted to biomass feedstocks, including waste wood such as tree limbs, tree tops, needles and leaves, the facility will have a capacity of 96 megawatts, according to the company.

Georgia Power was set to begin spending a significant amount of capital on the project at the beginning of this year. “But now that the rule is in question, it’s the prudent thing to do,” Wallace said of the action to delay the project. Otherwise, she added, customers could be subject to a cost risk if expensive changes are necessary to meet any new requirements.

The company had initially planned to begin retrofit construction on the plant in April 2011 and go on line in June 2012. A new

project timeline has not been determined, but Wallace said the draft of the ruling should be out in April, at which time Georgia Power will have an idea of whether its already-established standards will suffice. A final ruling is not expected until December 2010. Depending on what the draft brings, the project could be back on track in April. “They may come out with something within our own guidelines,” she said. The timing of the final rule release and the possibility of the company having to change plans may bring Georgia Power uncomfortably close to development deadlines for tax credits and other financial incentives.

In the meantime, Georgia Power is looking into alternative boiler technologies, in case the ruling significantly impacts the cost of the planned boiler conversion. “We think it’s in our best interests, just in case the current boiler doesn’t meet their specifications,” Wallace said.

The company does not expect to scrap the project altogether, but instead is preparing for possible changes. “We don’t think that the project is going to be cancelled,” Wallace said. “Our hope is it’ll just be a matter of modifying our existing design, or adding new equipment.”

—Lisa Gibson

Indiana company to offer energy crop plantlets A company in Indiana aims to streamline Miscanthus giganteus and Arundo donax (giant reed) production by offering growers plantlets resulting from a micropropagation technology.

Both crops are high-yielding perennial grasses that have been studied as potential biomass feedstocks for quite some time, but their use as a commercial-scale energy crop has been slow to fruition due to their sterile nature and the labor intensity involved in harvesting the plants.

White Technology LLC acquired an exclusive license for the micropropagation technology, developed by University of South Carolina plant geneticists Laszlo Marton and Mihaly Czako, about a year ago. The technology utilizes the regenerative nature of miscanthus and arundo to enable mass plantings of the crops.

Kenn Davis, White Technology CEO, said the technology is superior to traditional methods of growing the crops, in that thousands to millions more plants can be grown in the same amount of

time required by other companies working to develop and plant rhizomes. Rhizomes are horizontal, underground plant stems, which are cut from mature plants and then planted for reproduction.

“We’ll be able to support large farm operations, large enough to support biomass feedstocks for energy plants in a much shorter period of time; it’s a lot more reliable,” Davis said.

Davis said White Technology is putting together package deals for buyers and is currently taking orders. He said interest in the crops has been “overwhelming,” but the company has found very few who are interested in actually purchasing the plantlets. Rather, the majority of inquiries are persons looking for the mature plants to use as feedstocks at biomass plants. “So we’re working to incorporate that philosophy into a package deal,” he added. “We have a lot going on.”

—Anna Austin

3|2010 BIOMASS MAGAZINE 23

ENERGY CROPS

This switchgrass bale will be used in one of several ongoing projects at Genera Energy.

PHOTO: GENERA ENERGY LLC

24 BIOMASS MAGAZINE 3|2010

ENERGY CROPS

Energy Crop Conundrum Dedicated energy crops hold massive potential as a renewable energy resource, but hurdles remain in the path of their large-scale utilization.

By Lisa Gibson

3|20010 BIOMASS MAGAZINE 25

A

demonstration-scale facility in Vonore, Tenn., began producing cellulosic ethanol in late January, fueled by a steady diet of corncobs with the intent to transition to 100 percent switchgrass feedstock aover the next year. The plant has a nameplate capacity of 250,000 gallons and has its biomass supply chain ready and waiting, through the farmer-owned Tennessee Biomass Supply Co-op.

‘We actually evaluated a number of different feedstock alternatives and decided that switchgrass was a really good fit for this project and for this region. We see switchgrass activity as generating a lot of the important values and data we need to develop a commercial-scale supply chain.’

Kelly Tiller, president and CEO, Genera Energy

The plant, developed by partners DuPont Danisco Cellulosic Ethanol LLC and Genera Energy LLC, is one of only a few, however, as dedicated energy crops search for their window to permanently and significantly slip into the U.S. renewable energy market. Two crucial steps in the realization of their potential seem obvious: farmer involvement and land-use patterns.

Farmers in the Tennessee Biomass Supply Co-op will be responsible for providing switchgrass to the Vonore facility, including growing, material handling, preprocessing, supply chain logistics and even marketing, according to Kelly Tiller, president and CEO of Genera Energy, wholly owned by the University of Tennessee.

“That’s the very important next step: getting farmers engaged and involved in the supply chain,” Tiller says. “We’ve set this up as a demonstration for how to do this.”

Members of the co-op currently contracted with the University of Tennessee to grow switchgrass for Genera have 2,700

PHOTO: DDCE

ENERGY CROPS

DDCE’s demonstration plant in Tennessee began production in January.

acres planted on private farms. In April, the company will add another 5,000 acres to its cache for use in several of its ongoing projects. “It will actually be in great excess of what we need to operate that facility,” Tiller says of the DDCE plant. Switchgrass is a sustainable feedstock that can be used for

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ENERGY CROPS

This partially cut field of switchgrass is used to produce cellulosic ethanol.

numerous projects in the Southeastern U.S., she adds. “We actually evaluated a number of different feedstock alternatives and decided that switchgrass was a really good fit for this project and for this region,” she says.

“We see switchgrass activity as generating a

lot of the important values and data we need to develop a commercial-scale supply chain.”

The U.S. DOE has identified it as a preferred dedicated energy crop and has also determined hybrid poplars and hybrid willows to be favorable tree energy crops for biopower.

Switchgrass is perennial and grows well on marginal and underutilized lands, requires minimal input and can be harvested and handled using existing equipment. The crop’s greatest potential is the amount of biomass it can produce, Tiller says, adding that the yield per acre is between eight and 10 tons without improvements in the varieties. Genera, however, will continue work to improve the yield and cost efficiency of the crop.

“In my opinion, [energy crops] hold tremendous potential,” Tiller says, being careful to add that they’re not the only solution in the world’s transition from fossil fuels. A whole portfolio of technologies will come into play. “But within cellulosic ethanol, I do think dedicated energy crops are critical to the large-scale expansion,” she says.

The Vonore facility will serve to prepare DDCE’s integrated conversion technology for commercial production by 2012.

Genera’s 7,000 acres are only the tip of the iceberg in switchgrass planting poten-

ENERGY CROPS ‘I want a biomass that looks like grain, handles like grain, is treated like grain. That’s my goal.’

PHOTO: GENERA ENERGY LLC

Mark Downing, ag economist and senior scientist, Oak Ridge National Laboratory

These switchgrass bales will be used in one of Genera Energy’s projects.

tial in Tennessee. “We did some modeling, looking at marginal cropland just in Tennessee and identified more than 1 million acres that can move into dedicated energy crop production,” Tiller says.

Biobarriers Land-use patterns will need to change to accommodate the widespread growth of

28 BIOMASS MAGAZINE 3|2010

dedicated energy crops, according to Mark Downing, agricultural economist and senior scientist at the DOE’s Oak Ridge National Laboratory in Tennessee. “The biggest resource we have is land,” he says. “There may be some limited feedstock issues unless we make some monumental changes about what we do with the land that we have.”

Food and energy crops can be grown

without interfering with each other, but an in-depth look at all the nation’s land resources is essential to optimize agriculture and energy policy, Downing says. The U.S. is good at balancing food, feed and fiber, he adds, but hasn’t gotten into the fuel equation yet. “Pick and choose your land for energy crops,” he emphasizes. “They don’t need No. 1 corn land.”

Work also needs to be done to determine where each crop would grow best, a project Ceres Inc. has been working on with its switchgrass, miscanthus, sweet sorghum, biomass sorghum and energy cane varieties. The company’s high-yielding switchgrass cultivars and high-biomass sorghum hybrids are available now under the brand name Blade Energy Crops. The company’s Web site (www.ceres.net) includes maps of the U.S. that outline target markets for each of its crops. Ceres is also evaluating international markets, according to the site. As of now, production of biofuels has been largely limited to the Corn Belt, but the

ENERGY CROPS

The CEO of SG Biofuels believes that jatropha is the only near-term solution for biofuels production.

USDA estimates 60 million acres in the nation could be used for dedicated energy crop growth, opening the door to more states participating in biofuels production.

Getting farmers engaged in the supply chain and growing those crops isn’t easy, however, and is exacerbated by a lack of standards for biomass conversion technologies. “The farmers are asking the biore-

finery what it wants and the biorefinery is asking the farmers what they have,” Downing explains, adding that the nation is moving closer to solving the problem, but isn’t there yet. “So, I don’t have a commodity called biomass that can be assigned valueadded properties that make it high enough value to be able to ship it very far.” Grain elevators know what they’ve got when

the product comes in, he says. “I want a biomass that looks like grain, handles like grain, is treated like grain. That’s my goal.”

In order to plant on a large scale, the correct seed varieties and plant materials need to be available, Downing says, making aggressive breeding programs fundamental.

Mendel Biotechnology is working to accelerate improvement in plant varieties, drawing on its knowledge of the regulation of plant gene and pathway function. The company serves agricultural companies with new genetic and chemical solutions and strives to be the leading seed company serving the bioenergy industry, according to Mendel.

Another huge barrier to widespread use of dedicated energy crops is the cost of producing cellulosic ethanol. “The trick is yes, you can make ethanol out of lignocellulosic material and it has been done,” Downing says. “The problem is you can’t afford to do it.” Separation of lignin, cellulose and hemicellulose, along with the conversion of cellulose and hemicellulose to sugars for fermenting is a costly endeavor. “You’d think it’d be easy,” he says of commercializing an efficient process. “But we have not had the investment. We have not had the push. We have not had, quite frankly, the national need or thrust that the corn ethanol industry has.”

3|2010 BIOMASS MAGAZINE 29

ENERGY CROPS The DOE has awarded some funding to lignocellulosic biorefineries. Under the Biomass Research and Development Initiative, Genera recently received a $2.4 million grant to research and improve switchgrass varieties in cooperation with Ceres and DDCE, Tiller says. With the funding, Genera will compare Ceres’s improved switchgrass varieties to traditional ones on a large scale, she says. In addition, Genera was awarded a $4.9 million DOE grant to optimize removal, transportation and storage of switchgrass, including the use of in-field chopping systems instead of baling.

Downing shares Tiller’s belief that dedicated energy crops will play a large role in the switch from petroleum and fossil fuels. Oak Ridge National Laboratory’s Biomass as Feedstock for a Bioenergy and Bioproducts Industry: The Technical Feasibility of a Billion-Ton Annual Supply, commonly called the BillionTon Study, found that an estimated 1.3 billion tons of biomass feedstock could be available countrywide including agricultural residues, forest resources, herbaceous energy crops and woody energy crops, under a number of assumptions, probably the most important being land use, Downing says. But what that study did not address is equally important: Where are those feedstocks available? What are they? What will it cost? Downing and about 50 fellow scientists are going back to the study and elaborating on it, making some important changes and delving a bit deeper.

The results should be released in June. “We’ll have to go under scrutiny and knife, but we are optimistic, based on what the secretary [of energy] and the president say we should be producing for fuels by 2022, that we’re going to have a significant amount of feedstock to satisfy that,” he says. The U.S. renewable fuels standard, established in the Energy Policy Act of 2005, is 36 billion gallons by 2022.

“Growing switchgrass and trees isn’t inexpensive,” Downing says. “Picking up corn stover is not cheap either. There are nonexistent markets for some of these things; there are always alternative markets that farmers will seek out to provide the highest revenue for their farm enterprises. They don’t care what it’s used for; they just want the highest price.”

Near-Term Profitability “On a macro level, one of the key elements missing in biofuel feedstocks is that most are not profitable today,” says Kirk Haney, president and CEO of California-based SG Biofuels. “Jatropha is.” SG Biofuels has the largest library in the world of jatropha genetic material, along with 4-year-old field trials in Latin America.

“Our business model is to develop jatropha so it’s the highestyielding with the lowest input costs,” Haney says. “We think the most important thing is profitability for farmers.”

In mid-January, SG Biofuels announced it had formed a strategic alliance with Life Technologies Corp., a provider of life science

30 BIOMASS MAGAZINE 3|2010

ENERGY CROPS solutions, to further sequence the jatropha genomes and put the perennial plant on the fast track to commercialization. Life Technology’s choice to partner with SG Biofuels signifies the promise and potential of the plant, Haney says. “It’s really market validation for jatropha and market validation for our company,” he says.

“The reality is, in the near-term, biofuels are going to play a very important strategic part in offsetting petroleum,” he says, adding that jatropha will have a significant impact on that biofuels industry. Biodiesel from jatropha shows a 70 percent greenhouse gas reduction from petroleum biodiesel levels, he cites. “It’s a fuel that works.

It’s profitable today, and with companies like ours, it’s only going to get more profitable.”

The plant has shown yields four to five times those of soybeans and two to three times the yield of rapeseed, Haney says.

“Another reason we’ve approached jatropha is that Mother Nature has already developed this plant to a point where it’s clearly a high yielder with lower input costs,” he says, adding that it’s well-known in the aviation industry. “It makes a great jet fuel,” Haney says. “It’s actually more fuel efficient than kerosene.” The biomass portion of a recent 50-50 biomass/petroleum jet fuel blend consisted of 48 percent jatropha, 1 percent algae and 1 percent camelina.

SG Biofuels is working to identify favorable traits—including cold tolerance— that will allow the crop to be grown outside its native habitat of Central America. Jatropha can be grown on marginal or abandoned lands so as not to compete with food crops, and is not currently grown in the continental U.S. More than 800 million acres of nonagricultural land around the world could be used to plant jatropha, Haney says, and that does not include areas that could grow cold-tolerant strains.

To put that in perspective, 50 million acres are planted with sugarcane today, and about 200 million each of corn and soybeans, he says.

SG, with its new partner, will continue to work with jatropha to bring it to market and has had success in its field trials and lab work. “We have some incredible data that will revolutionize the space,” he says, adding that it’s too early to disclose it. The alliance will develop region-specific cultivars, an aspect of energy crop production that both Haney and Downing believe is crucial.

“One thing we think is missing with a lot of energy crops is not just doing trials in one

specific area where the plant grows really well,” Haney says, building on Downing’s land-use viewpoints. “To get the plant to have the scale of a corn, a soybean, wheat and sugarcane, we have to grow it in different regions of the world.” BIO Lisa Gibson is a Biomass Magazine associate editor. Reach her at lgibson@bbiinternational. com or (701) 738-4952.

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The solution behind the solution.

3|2010 BIOMASS MAGAZINE 31

MISCANTHUS

MAKE

WAY

FOR

MISCANTHUS

Genetic improvements and advancements in growth and harvest techniques are moving miscanthus closer to becoming a commercial energy crop.

By Anna Austin

32 BIOMASS MAGAZINE 3|2010

MISCANTHUS

3|2010 BIOMASS MAGAZINE 33

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MISCANTHUS

R

esearch on miscanthus as an energy crop took off in the U.S. in the mid-’90s, but interest in the grass has peaked during the past few years. Though steady progress is being made in all dimensions of utilizing miscanthus as a biomass crop—from breeding to planting to harvesting to pest control—there are still some challenges to overcome.

Because miscanthus is naturally sterile, it must be grown by planting its root-like stems called rhizomes, a process similar to potato planting. While some groups have focused on developing rhizomes to provide to future growers, which takes about three years to accomplish, others are concentrating on genetic improvements such as seeded varieties of the crop.

Mississippi State University researchers have spent more than a decade isolating, identifying and developing genotypes of giant miscanthus that would be most suitable for commercial growth in the South. Their work has led to the development of a new strain dubbed Freedom. During MSU variety trials, Freedom demonstrated yields of 25 tons per acre and grew to 12 feet, outperforming switchgrass by a ratio of at least 2:1.

Soperton, Ga.-based SunBelt Biofuels is taking MSU’s research to the next level. The company obtained an exclusive license for Freedom a few years ago, and has since been working to produce plant material to sell to growers, according to SunBelt Biofuels President Phillip Jennings. The company currently has 250 acres of Freedom in Georgia and Mississippi, and plans to have rhizomes available for sale this year.

Miscanthus Milestone It has taken time and dedication to get to the point where SunBelt is able to supply miscanthus rhizomes to growers, according to Jennings. “For the past three years, our concentration has been on a series of studies involving the actual growing of rhizomes so we’re able to furnish grower manuals, since it’s a new crop,” he says. “We’re continuing to do numerous studies with major universities in the Southeast to learn more about the genetics of the plant.”

Beyond the region’s ideal climate, longer growing season and daylight hours, the Southeast, which is a region of focus for SunBelt, offers another advantage to growers—ample idle, available land. Georgia and Alabama each have a little more than 1 million acres of land not currently being utilized, according to Jennings, and South Carolina has 500,000 acres. Additionally, it costs considerably less to rent land in the Southeast than in other regions of the U.S. “Cash rent in Illinois is $200 to $400 an acre, and in Georgia its $50 to $70 an acre,” he says. “Land that doesn’t produce a profitable food crop—we want that land to host miscanthus.”

However, that doesn’t mean miscanthus can’t be grown in other areas from Florida to Canada, Phillips adds, the economics just fit better in the Southeast.

Freedom out-yields switchgrass because of the ideal growing conditions, while growers in other areas may fare better planting

PHOTO: SUNBELT BIOFUELS

MISCANTHUS

PHOTO: SUNBELT BIOFUELS

MSU researcher Brian Baldwin , left, and SunBelt Biofuels CEO Jennings stand in a field of miscanthus.

A miscanthus rhizome ball at nine months

switchgrass. “[In the Southeast], we’re going to get four times the amount of cellulose to the acre per year than you’d get with switchgrass,” he says. “It’s exceedingly hard to produce a stand of switchgrass in the Southeast, and after about three years, stands need to be replanted. It’s a wonderful crop for the prairie lands where it is native, but you can’t economically, feasibly reach yields that justify what we’ve got to

do with cellulose. Cellulose buyers cannot afford to pay a switchgrass producer what it costs to grow tons of switchgrass in the Southeast—it’s pure economics.”

Though it’s possible for growers to use the same equipment used to harvest hay, Jennings says those contracted for large acreages will likely require something more automated. “There hasn’t been a lot of technologies developed surrounding

3|2010 BIOMASS MAGAZINE 35

MISCANTHUS ter three years of collaboration. According to the university, the planter demonstrates a more uniform stream of rhizomes, enabling placement at a rate that matches rhizome weight, quality and ground conditions. The four-row planter incorporates separate feed hoppers and placement channels so it can be used for two-row nursery work and larger scale plantations.

The harvester lifts the rhizomes on a continual basis with a one-pass digging head and oscillating de-soiler. The rhizomes exit

PHOTO: UNIVERSITY OF ILLINOIS

miscanthus—we’re surprised at that—but we’re in the process of developing and will soon have a precision planter that will plant miscanthus the same way corn or soybeans are planted, and we also have developed a mechanical digger.”

Others are also working to automate miscanthus planting and harvesting. The University of Illinois in partnership with Tomax Ltd. and Bermuda King USA, recently unveiled a miscanthus rhizome regeneration harvester and planter system af-

Miscanthus rhizome regeneration harvester

via a bulk side discharger that conveys the rootstock to an adjacent trailer. The equipment will be available for licensing this year.

For those who aren’t sold on the idea of establishing and planting rhizomes, California-based Mendel Biotechnology Inc. is developing seeded varieties of miscanthus, a route it believes will serve as a long-term solution for commercial production of miscanthus.

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When a company specializes in plant breeding its long-term fundamental asset is the scope and diversity of the gene pool that it can draw on to create commercial varieties, says Mendel Biotechnology President and CEO Neal Gutterson. “So what Mendel did early on, through the acquisition of a breeding program in Germany, was collect miscanthus accessions to put together what we think is the world’s best and most robust miscanthus germplasm pool. That pool now has 2,000 accessions; quite a few natural accessions, and some developed varieties.”

MISCANTHUS ‘For the long term, we’re working toward creating varieties that can be reproduced from seeds. A seed production system is less expensive than a rhizome or plug system.’

demia are covering other bases of miscanthus production, including possible hindrances.

Pondering Pests

thrive on Freedom, Jennings says. “Our pathologists have injected our plants with numerous leaf diseases and they haven’t taken,” he tells Biomass Magazine. “We’re not saying that Freedom is 100 percent resistant, but it was selected because it’s a superior variety for the Southeast.”

University of Illinois researcher Joseph Spencer, however, says those involved in or considering growing giant miscanthus should test the waters before jumping in, and fully understand pest possibilities and

Beyond innovations in yield, growth and harvest, perhaps one of the most overNeal Gutterson, president and CEO, Mendel Biotechnology looked aspects of developing new biomass crops is potentially negative scenarios such as disease, pests and effects on other crops.

Why so many accessions? Gutterson So far, SunBelt hasn’t experienced any pest says most of the accessions are not actu- or disease problems in the Southeast that ally under development for commercial use in the next two to four years, but serve as assets to build on in the long term. “In the short term, we’re focused on sterile varieties like many other people, and our approach at the moment is to propagate those with partners and to deliver them to farmers and growers in the form of transplant plugs,” he says. “Establishing plugs is quite a reliable form of delivering planting material.

Like the rhizome system, it’s still rather expensive all-in-all, and although Mendel does have a proprietary clone, we don’t see that as a long-term solution for a scalable miscanthus industry. For the long term, we’re working toward creating varieties that can be reproduced from seeds. A seed production system is less expensive than a rhizome or plug system.”

“Seeded varieties will dramatically change the cost structure of producing miscanthus for developers, growers, and power companies and refineries,” Gutterson says.

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MISCANTHUS

Spencer examines giant miscanthus plants that have been exposed to the western corn rootworm.

consequences. He is particularly concerned about the western corn rootworm (WCR).

Although the WCR typically feeds on corn crops, Spencer’s research indicates it could thrive on giant miscanthus. Just because corn isn’t grown in regions that are ideal for giant miscanthus production, doesn’t mean that a WCR infestation should be ruled out, Spencer says. “It is present in parts of the Southeast U.S.—in western North Carolina and Tennessee, as well as northern South Carolina, Alabama and Georgia—though this species has invaded these areas only in past 10 to 15 years,” he says. “The WCR is a very adaptable and mobile pest. Pest managers in the Midwest know only too well that it can cause serious economic problems if ignored.”

While Spencer agrees with Gutterson and Jennings that interest in farm-scale plantings of giant miscanthus is healthy, he emphasizes that it’s not yet known whether the WCR will become a pest of giant miscanthus or whether giant miscanthus will become a source of WCR that will invade corn, or if giant miscanthus might actually benefit corn growers by acting as a refuge

38 BIOMASS MAGAZINE 3|2010

MISCANTHUS ‘If I were a grower I would want to go into my giant miscanthus commitment with a full understanding that pests and pest management costs may not be negligible.’

Joseph Spencer, University of Illinois researcher

for WCR that are susceptible to transgenic corn hybrids. “If I were a grower I would want to go into my giant miscanthus commitment with a full understanding that pests and pest management costs may not be negligible,” he says. “In the case of the WCR, it is our most significant pest of corn—it is adapted to a host plant that is available in the same field year after year; we were not surprised that the WCR could survive on a grassy biomass crop with a perennial growth habit. I think it is becoming clear that claims of a lack of pests on giant miscanthus are due to not looking for them, not because they are absent. That sort of hubris gets you in trouble with nature.”

From Spencer’s perspective, issues related to potential pests must be analyzed extensively for the future success of giant miscanthus. “Another issue that is often discounted is whether giant miscanthus may become invasive,” he says. “People, who suggest caution in this regard, are painted as being obstructionist. Any time someone tells me that we don’t have time to be careful my discomfort level goes up a notch or two. There are good reasons to work toward biofuel alternatives; this new and developing technology will certainly provide good jobs and profits to those involved. However, until we are willing to accept the responsibility for associated risks I don’t think we can go ‘all in’ on this.”

As long as the proponents are mainly focused on profits and are unwilling to shoulder the risks, or adequately address them, it is a gamble, Spencer adds. “It’s a lot like gambling with someone else’s money— there’s little need to be risk averse when it doesn’t cost you anything to lose. Being

thoughtful and thorough in the collection of data about a system’s risks and benefits is far less costly than acting in haste and paying to clean up a mess down the road.”

Fueling the Future Developing new crops is never easy but miscanthus does have an advantage as a bioenergy feedstock—the Biomass Crop Assistance Program. Gutterson says he thinks programs such as the federal BCAP are essential in helping the industry get on its feet, but it needs to be extended. “Our view is that any program that is important to help an industry get on its feet shouldn’t last for 20 years, but BCAP needs to be available longer than its current [duration, which is 2012]. I think if it’s available out to 2016 or 2017, it will get the industry over the hurdle.

At this stage, where there’s a lot of speculative production and a pretty high cost of

establishment, BCAP is essential to get this moving.”

As always the industry struggles with its chicken and egg dilemma of what should come first the feedstock or the facility. “By the time the cellulosic ethanol people are ready, the [feedstock] needs to be here,” Jennings says. “There’s no reason to build the facilities until you have the [feedstock]. Our government has somehow gotten one ahead of the other—the area we need help in is the feedstock. Once we get that done, then the facilities will come. It’s backwards to get these facilities up and then figure out what to feed them.” BIO Anna Austin is a Biomass Magazine associate editor. Reach her at aaustin@ bbiinternational.com or (701) 738-4968.

3|2010 BIOMASS MAGAZINE 39

PROFILE

It’s Show Time The nation’s first grower-owned biomass cooperative has shown the world that the cooperative model can be successful and is ready to build on that success.

By Rona Johnson

40 BIOMASS MAGAZINE 3|2010

PROFILE

3|2010 BIOMASS MAGAZINE 41

PROFILE

A

t a time when many biomass project developers are searching for financing and developing systems capable of handling thousands of tons of biomass, Centerview, Mo.-based Show Me Energy Co-op has already done that and is now gearing up to expand.

Although co-op members couldn’t reveal all of their expansion plans because some are still in the early planning stages, they did say they are researching the possibility of building a power plant on site to create green electricity, and negotiating a contract with another utility in the area. Show Me Energy Chairman Steve Flick says the co-op could make an announcement regarding its expansion plans by April or May. Currently, the producer-owned co-op processes biomass into pellets that it sells to a local utility, to poultry producers in the area, who use it to heat their chicken and turkey barns, and for home heating. “We’ve shipped material all over the world,” Flick says.

The development process wasn’t easy, Flick says, but they were successful because they answered two questions before they started their equity drive: How are we going to move all this material? How are farmers going to make money in the process? “The nucleus of the group started in 2005 and we began by studying feedstock availability, the sustainability, the life-cycle assessments, and how can we provide positive impacts on the rural landscape and create green jobs at the same time,” Flick says. The group then went on to figure out what and where would be the best potential for marketing their biomass pellets. Once they had a handle on those, they came up with what they

thought was a good business model and went out to find investors.

“We sold shares into the co-op as farmers selling to farmers,” Flick says. “We pitched it to small-town America within a 100-mile radius of the proposed plant site. We knew we were successful because we raised a lot of money very quickly.”

Having the farmers, who would be delivering the biomass to the plant, on board was key to the project’s success, Flick says. “We believe that no matter what technology anybody has—power or liquid fuels—if it’s not valuable to the farmers they won’t participate in the project,” he says. “They have to have skin in the game.”

The co-op was set up and then closed after the organizers raised their initial investment. It was then reopened in the fall to raise money for capital expansion, Flick says. “We will have some minimal investment in March but that’s about it,” he says. “It’s really only for Missouri residents who live within the local area.”

The co-op’s equity drive got a boost from the state of Missouri in the form of tax credits for producers who bought shares. “The Missouri Department of Agriculture has been our No. 1 partner through an organization called the Missouri Agriculture Small Business Development Authority,” Flick says. In 1988, the legislature granted the Missouri Agriculture Department the authority to set up an organization allowing the state to partner with new-generation cooperatives.

“When we sold our shares in that first round, the state of Missouri gave tax credits to the producers who bought those shares.” Farmers could then sell their tax credits or use them to reduce their tax liability.

“It wasn’t like you got a grant and if the thing doesn’t work then the

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PROFILE state ends up owning it, this is real money on the line,” Flick says.

The technology the cooperative uses was designed in-house by a group of farmers and engineers who license it to others who want to build a pellet plants in their local areas.

Although the co-op hasn’t paid out dividends to its members yet, it hopes to soon. “We probably won’t do that for another year because we are constantly re-investing and reducing debt load,” Flick says.

Delivering the Biomass The co-op has 650 members from 28 counties, supplying everything from storm- and ice-damaged wood, switchgrass, native grasses, stubble, cereal straws, corn stalks and milo stubble. The plant takes in 10 to 15 truckloads of biomass per day, which doesn’t impact its neighbors because it was built in a rural area. “We believed the plant had to have a minimal impact on the area that we were living and working in,” Flick says. The site was also chosen because it has access to two hard surface roads and a rail line About 90 percent of the biomass that comes into the plant is in the form of round bales, Flick says. The rest is transported in on walking floors. The 16-acre site only allows the cooperative to store 3,000 bales so farmers store the material on their farms until the coop needs it.

For famers, both members and nonmembers, who deliver to the plant, it’s a way to get more value from the crops they already grow.

For example, Flick and other members who grow grass seed used to burn the straw after they harvested the seed. Now the straw is baled

Show Me Energy processes biomass into pellets that it sells to a local utility, poultry producers in the area, who use it to heat their chicken and turkey barns, and for home heating.

and delivered to the pellet plant, where it can fetch $40 to $60 per ton, based on its net energy value.

The plant also benefits farmers who for economic reasons have had to change their cropping systems.

Since the early 1950s, Mike Rape’s family supplied sod for the turf grass industry for new housing. Until the collapse of the housing market, his farming operation consisted of 100 percent sod. “When we first formed this co-op three or four years ago, I could see there was going to be a tremendous downturn in the housing market, and am now rotating out of the sod,” says Rape, who is a past president of the Kansas City Turf Association and is currently on Show Me Energy’s board of directors. “We now farm 900 acres and we are going to

3|2010 BIOMASS MAGAZINE 43

PROFILE row crops and energy crops and only going to have maybe 100 to 200 acres of sod.”

The sod business is about 80 percent of where it was four or five years ago, when the eight-county region around Kansas City, Mo., was generating 10,000 to 13,000 housing permits a year. Rape says they will barely reach 2,000 permits in 2009.

Rape believes the co-op created a perfect opportunity for him, and that between the switch to row crops and the biomass that he delivers to the plant, he will make up for any losses he has incurred, especially when the contract they are currently negotiating with the power company is signed and the plant’s production is ramped up. “When we get this up and running to full capacity this should substantially increase and subsidize my loss from the sod business,” he says. “I personally think that it could be more beneficial in years to come because the downturn in the housing market is going to be there for a while.”

He let some of his sod fields grow up and then baled the biomass from those fields, and he plans to plant some higher yielding biomass crops that the co-op is experiment-

ing with so that I can get more tons per acre.

“I raised zero row crops in the past, so as far as food for fuel in my case, we did not do the traditional row crops at all and never have.“ Rape says the energy crops are ideal for planting on marginal ground and areas where the ground slopes. “You can plant energy crops there because you don’t disturb the soil and don’t have to worry about erosion like you would if you planted traditional row crops.”

The co-op has also created opportunities for hobby farmers and others whose primary income isn’t derived from farming.

Mark Schuchmann, a co-op member and an electrical contractor, became interested in joining the co-op because he had some family farmland that was planted to native prairie grasses that could provide him with some extra income. “The beauty of the coop is that a lot of members are farmers but there are others who are bi-vocational, who work at another job but also do a little bit of farming,” he says. “I’m one of those people.

I don’t have a lot of acres but I have enough to make my commitment.”

Schuchmann and Rape also provide extra income for custom balers because they currently have no equipment of their own, and the truckers who deliver the bales to the co-op.

The co-op members are also able to take advantage of the federal Biomass Crop Assistance Program, which pays producers or entities that deliver eligible biomass material to designated biomass conversion facilities that will convert it into heat, power, biobased products or biofuels. “For every dollar that we pay the producer, the federal government subsidizes them with another dollar, which will continue for two years,” Flick says. The cooperative was the first to apply and receive BCAP benefits. “We were the first BCAP area in the U.S. and it’s working,” Flick says. “It was a little confusing because we’re creating an industry shift from traditional DCP (Direct and Counter-Cyclical Program) payments and CRP (Conservation Reserve Program) and all this has to flow down from the national office to the state office to the county offices.

There was quite a learning curve involved for everyone including us.” Flick says they are

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PROFILE now looking forward to the next round of BCAP, which will focus on dedicated energy crops. “There could be 25,000 acres of dedicated energy crops planted just for the co-op that in turn would be a wonderful feed supply that could increase our production,� he says. “We don’t want to sound arrogant here but we believe we are on the right track and we’re moving ahead with exporting some of our material.�

One of the co-op’s marketing objectives is to make sure end users understand the difference between a pellet and an engineered fiber fuel, which is what the co-op produces. “It’s important to distinguish between the two because an engineered fiber fuel has three things that bring it to bear: certification showing that it was harvested sustainably; all the bad things that are usually found in biomass including silica, nitrogen, magnesium and potassium that will foul boilers [is removed]; third is our experience in using it,�

Flick says.

Co-op organizers also kept the cost of the plant to a minimum, which made it attractive to investors. “We’re not a $50 million project,� Flick says. “We built the plant for less than $10 million. We think economies of scale are local and we consider ourselves the new microbrewery on the block.�

Flick says he’s gotten calls from some large ethanol co-ops who are amazed at the progress that the co-op has made despite the fact that they had to write the book on biomass cooperative development.

“We’re the real deal,� Flick says. “We grind a bale every 10 minutes, we suck the dust, we have the breakdowns, we know what has gone right and gone wrong and everybody that says they want to do this. I say put your money where your mouth is, build it, run it, show me.� BIO Rona Johnson is editor of Biomass Magazine. Reach her at rjohnson@ bbiinternational.com or (701) 738-4940.

Co-op’s Impact Show Me Energy co-op executives believe they are only in the beginning stages of a bioenergy economy and that much work needs to be done to build the industry. The co-op plans to send a representative to major universities to educate graduating seniors in agriculture about producing bioenergy crops.

In May, I will be running to all the big 12 schools as part of our outreach,� Flick says. “It’s got to start with the next generation.

We’re just setting the foundation right now.�

Flick is convinced that the cooperative model is the key to growers wanting to participate in the biomass industry, but the producers have to be willing to take risks and invest their own money. “It takes five to 10 guys with a checkbook willing to take a risk to set up a co-op just like we did,� Flick says. “We didn’t know it was going to be successful and it means money on the line, hard work and a vision, and out of those initial people, you need a ramrod and you need somebody who will keep those people together politically,� Rape says that Flick is the ramrod who organized the co-op and keeps everyone on track. “Steve is the ramrod,� Rape says. “He is the hardest driving individual I have ever met.�

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3|2010 BIOMASS MAGAZINE 45

CROP RESIDUE

46 BIOMASS MAGAZINE 3|2010

CROP RESIDUE

The Path to Cellulosic Ethanol Crop residue is abundant and a good source of renewable energy, as long as its removal doesnâ&#x20AC;&#x2122;t cause soil nutrient depletion and erosion.

By Lisa Gibson

3|2010 BIOMASS MAGAZINE 47

CROP RESIDUE

48 BIOMASS MAGAZINE 3|2010

PHOTO: POET LLC

E

ight of the leading U.S. crops produce more than 500 million tons of residue each year, only a fraction of which can be removed for energy production because of equipment constraints and soil erosion concerns, according to a report by the U.S. DOE’s Biomass Research and Development Initiative. Even so, crop residue is expected to play an early role in the development of the cellulosic ethanol industry because of its immediate availability.

The report, “The Economics of Biomass Feedstocks in the United States,” lists the most common residue as corn stover and straw associated with wheat, rice, barley or oats production. In addition to cellulosic ethanol, these materials can be used for power generation through direct combustion, gasification or cofiring with fossil fuels.

Poet LLC has operated a demonstration-scale cellulosic ethanol plant in Scotland, S.D., for a year and a half, running on a steady diet of corncobs from local farms. Poet’s next endeavor, dubbed Project Liberty, will establish a commercial-scale cellulosic ethanol plant in Emmetsburg, Iowa, in 2011 that will produce 25 million gallons, according to Scott Weishaar, vice president of commercial development for Poet and Poet Biomass.

Project Liberty will be an expansion of a current 50-million-gallon-per-year dry-mill plant called Poet Biorefining, according to Poet, and will require 750 to 850 tons of corncobs per day. The sheer volume of that supply seems staggering, but Weishaar isn’t worried. “It’s an extremely aggressive goal, but we believe we’ll need 300 to 400 farmers involved to support full commercial activity of the cellulosic facility,” Weishaar says. “Our objective is to have 100 farmers under contract this next year for cob collection around the Emmetsburg area.”

The goal is more than attainable, as demonstrated by a November Project Liberty Field Day that drew many local farmers,

A combine and cart biomass harvesting system collects cobs during a Project Liberty test harvest.

some ready to sign on the dotted line. At the event, more than 60 farmers said they would be willing to supply corncobs to the plant, Weishaar says. “The next step would be for them to make their decision on the type of equipment or approach, and then Poet will be contracting with them.”

Farmers contracted to provide feedstock for Project Liberty will need to invest in residue harvesting equipment, Weishaar explains. Currently, little cob collection is done in the country, so much of the required equipment is still in the prototype phase, but some is commercially available. “If they’re going to invest in the equipment, we’re going to invest in the farmer so the farmer knows he has a market for the cobs he collects,” he says.

PHOTO: POWERSTOCK

CROP RESIDUE

This corn stover is ready for PowerStock to harvest.

Soil Depletion, Erosion Risks Removing residue can cause problems for the soil, depending on where the crop is located, the soil type and how much is removed, according to Noel Gollehon, senior economist with the USDA Natural Resources Conservation Service. Residue serves two main functions for the soil: it protects from rain, wind and erosion; and decomposes back into the soil as organic matter that is an important source of carbon and thereby an important element of soil quality, Gollehon explains. Some crops produce more residue than others and if only a little is present and promptly removed, it leads to soil depletion. In addition, some residues break down quickly, while others remain on the soil. “But as long as we replace the nutrients that are lost with it, it’s a practice that can go on for some time,” he says.

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“We’re staying way below the residue numbers as far as what we’re leaving on the field,” Weishaar says. “We want to be good stewards of the soil and the last thing we want to have happen is the farmer taking too much material where he opens himself up to nutritional loss or erosion issues.”

To make sure this doesn’t happen, Iowa State University is conducting region-specific studies in the Emmetsburg area to determine best practices for residue removal. The study includes two extreme scenarios: taking everything off the corn field; and traditional combining where all residue is deposited back onto the field.

The research will also evaluate four variations in between and will monitor soil condition, nutrients and other crucial issues. “We want to make sure we can answer those questions for the farmer and more importantly the landowner, on what are the impacts to the soil if it’s [removed] one year, three years or whatever it may be for my soil,” Weishaar explains. The results were due in February and at press time Weishaar believed they would not deter interested farmers from participating in Project Liberty. “We’re confident that it will not be harmful to the soil, that the results will be very positive,” he says. Thus far, soil concerns have not steered farmers away, but they do want to know what data is available and what to expect, he adds.

Project Liberty is on task as far as permitting goes, so the next step is to generate farmer contracts. “The third leg on the stool is activities surrounding E15 and expanding the market,” Weishaar says. “The last thing you want to do is build a plant if you don’t have an available market to sell the ethanol to. The E15 legislation that will allow our market to expand is vital, as well.”

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CROP RESIDUE today is a waste product,” Weishaar says.

“It’s a residue that’s thrown back out on the field.”

“The revenue piece is a big piece of this,” says Craig Reeder, vice president of Hale Farms in Oregon. “It’s potential revenue as a crop in rotation, which is helpful for us out here.” Hale Farms plants 25,000 acres of green peas, lima beans, sweet corn, wheat, potatoes, grass seed, onions, alfalfa, timothy hay and grain corn. Every year, about 20,000 to 30,000 tons of residues are

harvested from most of those crops, excluding onions and potatoes, by PowerStock, a biomass supply chain company. Hale Farms has contracted with PowerStock’s parent company, Pacific Ag Solutions, for about 10 years.

PowerStock, which was recently established to expand Pacific Ag’s residue work, harvests a total of 150,000 tons of residue per year in Oregon and Washington, handling the entire process so farmers don’t have to do anything more than what’s re-

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quired for their primary crops. “When you’re in the business of agricultural residue removal, you’re in the business of following another farmer’s harvesting equipment at the right speed, taking off the right amount—not too much or too little—and completely removing it from the field,” says Steve Van Mouwerik, PowerStock CEO. “For them, it’s a service we provide, but for us, it’s how we manufacture a product that we can sell.”

It’s a different approach from Poet’s, because Van Mouwerik believes it’s not economical for farmers to harvest residue from their own fields. “The important thing about agricultural residue removal is that the farmer can’t afford to remove his own agricultural residue because it means purchasing additional harvesting equipment,” he says. That additional equipment is typically too expensive to harvest just one farmer’s field. “In order to have the proper levels of productivity for a harvest season for agricultural residue equipment, the norm is that one operator will cover a number of farms,” he says.

Reeder agrees. “To do it right and to do it timely and cover the acres, that’s a several-million-dollar capital investment,” he says. “And it happens right at harvest time, so when we’re harvesting those crops, we would have to add an entire new set of overhead and an entire new set of equipment and an additional harvest process.”

PowerStock’s strategy allows the farmers to stay focused on their primary crops. “Pulling off ag residue does give you that extra little peck on the cheek at the end of the year that allows you to be a little bit more competitive on your other crops,” Reeder says. “It also allows you to take a look at some alternative crops.”

Until now, PowerStock has harvested crop residue to be processed and shipped to Japan and Korea for cattle feed, or sold to domestic dairy operations. This year, however, the company will be involved in its first anaerobic digestion (AD) project in Oregon. PowerStock is also evaluating its involvement in a second AD project in Oregon. They both will involve wheat straw, grass straw and corn stover. “What’s new is the ability to utilize agricultural residue

CROP RESIDUE from crops in digestion, in bio-oils or in syngas,” Van Mouwerik says.

The market for agricultural residue is undoubtedly larger in Japan, China and Korea than in the U.S., Van Mouwerik says, but he believes the domestic market will grow. “Japan and Korea can pay more at this point for their feedstock than what is currently used in cost models for feedstock for digesters or cellulosic ethanol,” he says.

“That’s not a problem because they’re also more demanding when it comes to quality and have some sanitary restrictions. So there’s an opportunity for a whole segment of agricultural residue that can’t be exported to go into projects here.”

PowerStock allows cost-sharing and risk-sharing with farmers who are interested, as an alternative to just clearing the residue and paying the farmer. “If they believe there’s an upside in the market, they can do a cost-sharing strategy where you can split the upside,” Reeder says. “That’s one of the innovative things they’ve done that’s gotten a lot of growers interested in their process.”

Experience has sharpened PowerStock’s ability to meet farmers’ best practice requirements in harvesting to maximize supply aggregation. PowerStock has relied on Oregon State University to develop practices with growers that ensure the right amount of residue is removed to sustain the condition of the soil, Van Mouwerik says. “Everyone is mindful of what the soil needs because the farmer wants to keep growing his corn and his wheat and his soybean crop, and really it’s a matter of formalizing that stewardship as much as it is just doing it,” he says. The beauty of PowerStock’s operations is that the farmer can dictate how much residue to take or leave, Reeder explains. “If you tell them to leave three inches of straw, they can come in and leave three inches of straw,” he says.

“They don’t have to scalp it right down to the ground.”

Residue has a fertility value in the soil, but it can be managed, Reeder says. Removal is helpful when dealing with heavy residue that is difficult to till back into the soil and usually would need to be burned.

“It’s not something you have to worry

about, but you have to manage it correctly, especially on some of the dry-land acres,” he says. Weishaar cites ongoing studies that, early on, have found it beneficial for wheat crops following corn when cobs are removed. “Not having it on the field could actually be a positive thing,” he says.

Reeder sees great potential in residue removal, including a growing opportunity for options in mono-crop agriculture. “If we can get these fiber crops to work and turn this fallow ground into some perenni-

als for the fiber, it’s really going to be a benefit to everybody,” Reeder concludes. “It’ll reduce our carbon footprint and provide us with some crop options and alternatives.

[PowerStock] is really helping solidify those markets and create those markets and it’s going to be a huge, huge benefit to what we’re doing.” BIO Lisa Gibson is a Biomass Magazine associate editor. Reach her at lgibson@ bbiinternational.com or (701) 738-4952.

3|2010 BIOMASS MAGAZINE 51

INTERNATIONAL By Pablo Reali

PHOTO: SERVICIOS FORESTALES INTEGRALES

CONTRIBUTION

Silviculture adaptation for planting in hilly conditions

Forest Biomass Generation in Degraded, Steep, Outcropped Ecosystems A company in Uruguay is successfully using specially adapted bulldozers and the application of hydrated polymers to protect tree seedlings and develop plantations on marginal lands.

I

n Uruguay, about half of the land is considered priority soils (those allowed by the state to be forested), this means about 1.5 million hectares (3.7 million acres) are hilly areas with shallow soils, frequent outcropping and steep fields. Most of these soils were degraded by sheep overgrazing for more than a century. Many of these areas remain unplanted because of traditional plantation technology, which is based on rubber-tired tractors that cannot be used in such crude conditions.

Most of these types of soils

are in the Eastern and Northeastern regions of the country.

The price of forestlands there is the most suitable for forest investments, taking into account that it takes a long time for investments to pay off in the saw timber industry. Using the technology described in this article, more than 2,500 hectares were successfully planted in northeast Uruguay (Treinta y Tres and Cerro Largo Departments) in the worst topographic conditions in the country.

This technology is based on the use of bulldozers for ripping and plantation bed preparation,

The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Biomass Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).

52 BIOMASS MAGAZINE 3|2010

and also utilizing specially adapted bulldozers to apply hydrated polymers at planting time. These polymers protect the seedlings from a lack of water and at the same time provide nitrogen, potassium and a root promotion hormone.

Servicios Forestales Integrales is a well-known Uruguayan company with broad experience in forest ripping and planting, having been involved in the forest generation of more than 50,000 hectares in the past 10 years. In 2007, through a joint venture with Tubron SA, a major chemical company in Argentina,

SFI produced a new plantation system mixing bulldozer forest ripping and applying a superabsorbent acrylic polymer in the hole where the trees are planted.

The polymer has chemical activity providing for the controlled release of nitrogen, phosphorus and potassium fertilizers and a rooting hormone, which gave the trees a good start, even in the worst drought conditions.

After a successful set of trials, SFI planted about 2,500 hectares of Eucalyptus grandis, E. saligna and E. dunnii in the hilly regions of Northeast Uruguay.

Although these plantations

INTERNATIONAL By Pablo Reali

were developed for saw timber production (long rotations of 20 years), based on initial growth and national forest inventory data (conservative, as we expect from 20 to 30 solid cubic meters per hectare per year), SFI concluded that this new plantation technology could be valid for dendroenergetic forest crops in these degraded and marginal soils.

This type of project contributes greatly to local and national forest development because it increases the production of degraded soils, helps soils recover and creates jobs in one of the less developed zones of Uruguay (1 inhabitant per 15 square kilometers or 6 square miles).

Silviculture Development Summary Silviculture development is basically an adaptation of the hydrated polymer and ripping shallow soil in hilly areas. Starting with conventional weed control, a bulldozer deep ripping using Caterpillar D6 and D8 machines, depending on how rough the conditions are, is applied with opposite discs that allow for plantation bed preparation.

If field conditions permit it, the rubber wheels transit would be advisable for common bed preparation.

The greatest benefit of this adaptation is the use of the polymer hydrated mix, with or without the chemical action (nitrogen, phosphorus and potassium fertilizers and rooting hormone).

This balance will depend on the soil’s texture, water-holding capacity and its chemical fertility.

It’s worth noting, that these

hydrated polymer mixes function as effective starter fertilizers and aren’t dependent on rainfall like common granulated fertilizers for soil dilution, where it can be taken up by the eucalyptus roots.

The nitrogen, phosphorus and potassium, and rooting hormone with the electronic matrix of the polymer is control released into the water supply from the beginning when the root system is planted within the gel. In addition, the polymer works as a control-released fertilizer, which means that no fertilizer is wasted and it can be applied at the rate of 2 to 3 grams per seeding, instead of the conventional 80 to 150 grams of mineral granulated fertilizer. This saves the renewable resources of potassium and phosphorus and avoids groundwater pollution of the nitrogen.

Bioenergy Possibilities Power consumption in Uruguay has been increasing annually at a rate of 50 megawatts per year (Dirección National de Energía y Tecnología Nuclear, MIE, 2007). As hydro sources are still in the development stage and nuclear is prohibited by law, this increase in consumption is being fulfilled by neighboring countries. Both options are costly and not environmentally friendly. So, the Uruguayan state is promoting energy generation using renewable sources, mainly wind and biomass, supporting that with long-term fixed-price contracts and priority in the grid dispatch.

Energy generation by dendroenergy plantations within many areas of Uruguay has the following advantages:

Middle- and high-voltage lines near the forest soils Land permit prices conducive to forest investments Presence of permanent and abundant water resources Good forest sites Ample wood production using fast-growing species SFI estimated that 2,000 acres of Eucalyptus grandis, E. dunniiorE.maidenniiplantedina 10-year rotation could fully supply a 10-megawatt power plant.

Although pellet production in Uruguay is almost nonexistent, several feasibility studies demonstrate its potential profitability and contribution to the sustainable development of the country. For instance, feasibility studies conducted by the engineering faculty at State University show that a 10,000 ton per month pellet mill would have an installation cost of about $13 million. Estimating the cost, insurance and freight via the Rotterdam pellet price of about 120 Euros ($169), the calculated internal rate of return was 37 percent, with a repayment investment of three to four years (Borsellino, Carrau and Maisonnave, 2007).

The new development described earlier, promotes better use of forest land with severe outcropping and slopes. With conventional planting techniques (based on rubber-tired tractors) these areas could not be planted and would be only suitable for grazing cattle and sheep. There are hundreds of thousands of hectares of this land in Lavalleja, Treinta y Tres, Cerro Largo Rocha and Maldonado departments.

Planting costs, using the proposed technology, don’t differ much from the conventional method. The increase in the cost of the polymer and the bulldozer application are compensated by savings in the disking and manual fertilizer application.

More importantly, the forest company using this technology could plant in hilly areas with no significant economical or ecological value.

The use of mixing polymers protects the seedlings against drought for about 20 to 30 days, and if conditions don’t improve a single watering with about 2 to 3 liters (0.5 to 0.8 gallons) per seeding could assure full polymer recharging. The same recharging would also occur with about 10 millimeters (0.4 inches) of rain.

This will permit the use of marginal and degraded soils for different forest uses, including dendroenergy and other biomass applications, which depending on the situation could offer high profitability for the investor and a source of sustainable development for Uruguay.

The use of the hydrated polymer and the addition of fertilizers and root hormones in its composition, allows for a fast start even in dry conditions. Furthermore, there is field evidence that this treatment permits the seedlings to recover better from frost damage in the winter. BIO Pablo Reali is a forest, bioenergy and carbon adviser for Servicios Forestales Integrales.

Reach him at www.sfi.com.uv.

3|2010 BIOMASS MAGAZINE 53

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