INSIDE: ePURE OUTLINES REASONS FOR TRADE INVESTIGATION JANUARY 2012
Digesters
For Greener Power Anaerobic digestion may have a future in process energy Page 34
ALSO Will New Balance in US/ Brazil Imports, Exports Last? Page 40
The Arduous Climb to Get E15 Market Ready Page 46
www.ethanolproducer.com
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April 16-19, 2012
Colorado Convention Center Denver, Colorado
The Largest Biomass Industry Networking Event in the World! Sponsorships and Exhibit Space
Now Available
The International Biomass Conference & Expo is anticipated be even larger than last year’s successful event. With an anticipated 1,500 attendees, 230 exhibitors, 120 speakers and 60 sponsors, you’ll experience firsthand why the majority of our past exhibitors and sponsors have walked away with valuable contacts and sales leads. Register Today and Grow Your Future. CONTACT US: 866-746-8385 service@bbiinternational.com Follow Us: twitter.com/biomassmagazine
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contents
January issue 2012 VOL. 18 ISSUE 1
features 34
POWER Good Digestion
Anaerobic digesters hold great promise, but have been slow to catch on By Holly Jessen
DEPARTMENTS 6
Editor’s Note
New Year, New Agenda By Susanne Retka Schill
7 Ad Index 10 The Way I See It
Sugarcane Ethanol
Economics By Mike Bryan
11 Events Calendar
Upcoming Conferences & Trade Shows
12 View From the Hill
Out with the Old, In
with the New By bob dinneen
14 Drive
40
TRADE Ships Passing in the Night Will U.S. ethanol exports to and imports from Brazil continue? By Holly Jessen
A Year of American
Ethanol By tom buis
16 Grassroots Voice
It’s January 2012, Do You Know Where Your Industry Is? By Ron Lamberty
18 Europe Calling
Are European Producers
Overreacting? By Rob Vierhout
20 Business Matters
46
E15 Reaching the E15 Summit
Regulatory challenges to E15 implementation are met head on By Kris Bevill
Natural Gas vs. Energy
Innovation By Kate Bechen
22 Business Briefs 24 Commodities Report 28 Distilled 52 Marketplace
INSIDE: ePURE OUTLINES REASONS FOR TRADE INVESTIGATION JANUARY 2012
Digesters
For Greener Power Anaerobic digestion may have a future in process energy Page 34
Ethanol Producer Magazine: (USPS No. 023-974) January 2012, Vol. 18, Issue 1. Ethanol Producer Magazine is published monthly. Principal Office: 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. Periodicals Postage Paid at Grand Forks, North Dakota and additional mailing offices. POSTMASTER: Send address changes to Ethanol Producer Magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, North Dakota 58203.
4 | Ethanol Producer Magazine | january 2012
ALSO Will New Balance in US/ Brazil Imports, Exports Last? Page 40
The Arduous Climb to Get E15 Market Ready Page 46
www.ethanolproducer.com
On The Cover Anaerobic digester capacity was expanded at an Alberta feedlot where Growing Power Hairy Hill plans to power an ethanol plant now under construction. More on green process power on page 34.
editor’s note
As we turn Ethanol Producer Magazine’s volume number to a new year, we at BBI International begin the process of building the agenda for the 28th Annual International Fuel Ethanol Workshop & Expo. The FEW will be held early this year, on
June 4-7, in the leading ethanol state of Minnesota. One of the best ways to participate in the FEW is to be a speaker, and with more than 130 speakers needed to fill the busy agenda, there are plenty of opportunities. It’s an open process—any interested person can submit one or more brief abstracts of their presentation ideas. Learn more about becoming a speaker in the article on Page 11 of this issue. Nominations are also welcome for the two awards given each year at the FEW—the Award of Excellence given to an industry professional for his or her technical contribution and the High Octane award to an individual who has had a significant impact in the ethanol industry. If you have a name you think ought to be considered, send it in, along with a brief explanation of why this person deserves the award to EthanolEditor@BBIinternational.com.
New Year, New Agenda Susanne Retka Schill, Editor sretkaschill@bbiinternational.com
For industry news.
Follow Us: twitter.com/EthanolMagazine
LETTER TO THE EDITOR:
A Florida Proposal A bill to repeal Florida’s Renewable Fuel Standard, which requires that all state gasoline contain 10 percent ethanol, has been introduced into the state legislature by Rep. Matt Gaetz and Sen. Greg Evers. The proposed repeal of the state RFS makes no logic, sends the wrong signal to the rest of our country regarding national energy security and is irresponsible leadership in terms of state energy security, rural economic stimulus, massive job creation, clean burning fuel and environmental benefits. Instead of believing the grossly erroneous views on ethanol by Rep. Gaetz and Sen. Evers, our state leaders should enthusiastically embrace how to ensure that the investments made in Florida’s next generation ethanol and advanced biofuel production come to fruition. There are several commercial advanced biofuel and ethanol projects in development that encompass a total investment well in excess of $1 billion, including INEOS–New Planet BioEnergy, Highlands EnviroFuels LLC, Vercipia Biofuels, Algenol, and Southeast Renewable Fuel LLC. These commercial ethanol plants will create thousands of new jobs and economic stimulus. A recent economic impact study by John Urbanchuk demonstrated that the Highlands EnviroFuels 30 MMgy plant using biofuel cane and sweet sorghum will generate 65 direct jobs, 760 indirect and induced jobs, $44 million in annual household income and $51 million in annual GDP, not to mention hundreds of construction jobs, and the opportunity to keep Florida farms in operation. Killing the state RFS sends a horrendously wrong signal to the investment community and stymies
6 | Ethanol Producer Magazine | january 2012
investment in additional projects that would bring Florida to a leadership position in the country in advanced biofuels. Rather than kill the state RFS, here is a plan to revise and modernize the state RFS: 1. Create a carveout for the boating industry so that gasoline that contains no blended ethanol is readily available and competitively priced. 2. Expand the state RFS mandate to allow the use of all advanced biofuels to meet the 10 percent volume, including biodiesel, biobutanol, renewable gasoline and diesel, and all forms of ethanol made from noncorn feedstocks. 3. Create an incentive whereby all blenders must preferentially purchase ethanol and advanced biofuels produced within the state, when supply is available and fairly priced. 4. Allow for higher retail blends of ethanol such as E15, E20, E30 and E85 to give the consumer greater choices. Case in point: In Brazil, all gasoline contains 25 percent ethanol, and nearly all cars run on E25 or E100 (100 percent hydrous ethanol). Bradley Krohn President, United States EnviroFuels LLC Manager, Highlands EnviroFuels LLC Riverview, Fla.
AdIndex
EDITORIAL EDITOR
Susanne Retka Schill sretkaschill@bbiinternational.com
3
ASSOCIATE EDITORS Holly Jessen hjessen@bbiinternational.com Kris Bevill kbevill@bbiinternational.com
2012 International Biomass Conference & Expo
55
2012 International Fuel Ethanol Workshop & Expo
Jan Tellmann jtellmann@bbiinternational.com
48
2012 International Biorefining Conference & Tradeshow
ART
51
2012 National Ethanol Conference
11
Agra Industries
15
BetaTec Hop Products
54
Biorefining Magazine
32
BrownWinick Law Firm
31
Buckman
50
Cellencor, Inc.
22
CPM Roskamp Champion
43
Fagen Inc.
37
FCStone, LLC
19
Fermentis - Division of S.I. Lesaffre
38
Freez-it-Cleen
23
Gamajet Cleaning Systems, Inc.
COPY EDITOR
ART DIRECTOR Jaci Satterlund jsatterlund@bbiinternational.com
GRAPHIC DESIGNER Lindsey Noble lnoble@bbiinternational.com
PUBLISHING CHAIRMAN Mike Bryan mbryan@bbiinternational.com
CEO Joe Bryan jbryan@bbiinternational.com
VICE PRESIDENT Tom Bryan tbryan@bbiinternational.com
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ACCOUNT MANAGERS Chip Shereck cshereck@bbiinternational.com Marty Steen msteen@bbiinternational.com Bob Brown bbrown@bbiinternational.com Andrea Anderson aanderson@bbiinternational.com Dave Austin daustin@bbiinternational.com Kelly Kilgore kkilgore@bbiinternational.com
CIRCULATION MANAGER
21 & 56
Jessica Beaudry jbeaudry@bbiinternational.com
ADVERTISING COORDINATOR
2
Marla DeFoe mdefoe@bbiinternational.com
Senior Marketing Manager
17
John Nelson jnelson@bbiinternational.com
5
EDITORIAL BOARD Mike Jerke, Chippewa Valley Ethanol Co. LLLP Jeremy Wilhelm, Cilion Inc. Mick Henderson, Commonwealth Agri-Energy LLC Keith Kor, Pinal Energy LLC Walter Wendland, Golden Grain Energy LLC Neal Jakel Illinois River Energy LLC Bert Farrish Lifeline Foods LLC Eric Mosebey Lincolnland Agri-Energy LLC Steve Roe Little Sioux Corn Processors LP Bernie Punt Siouxland Energy & Livestock Co-op
8&9
Customer Service Please call 1-866-746-8385 or email us at service@bbiinternational.com. Subscriptions to Ethanol Producer Magazine are free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside the United States, Canada and Mexico. To subscribe, visit www.EthanolProducer.com or you can send your mailing address and payment (checks made out to BBI International) to: Ethanol Producer Magazine Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to (701) 746-5367. Back Issues, Reprints and Permissions Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at (866) 746-8385 or service@bbiinternational.com. Advertising Ethanol Producer 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 Ethanol Producer Magazine advertising opportunities, please contact us at (866) 746-8385 or service@bbiinternational.com. Letters to the Editor We welcome letters to the editor. Send to Ethanol Producer Magazine Letters to the Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or e-mail to sretkashill@bbiinternational.com. Please include your name, address and phone number. Letters may be edited for clarity and/ or space.
Please recycle this magazine and remove inserts or samples before recycling
GENENCOR® - A Danisco Division Growth Energy Highmark Renewables Inc. ICM, Inc. Inbicon
33
Indeck Power Equipment Co.
45
Johnson System, Inc.
26
Phibro Ethanol Group
27
Pioneer Hi-Bred International, Inc.
39
Renewable Fuels Association
42
Robert-James Sales, Inc.
13
Syngenta Seeds, Inc.
36
Victory Energy Operations, LLC
49
Vogelbusch USA, Inc.
44
Wabash Power Equip. Co.
COPYRIGHT © 2012 by BBI International TM
january 2012 | Ethanol Producer Magazine | 7
The New Ethanol. Refined, retailed, and rolling across America now.
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the way i see it
Sugarcane Ethanol Economics By Mike Bryan
Ethanol production from sugarcane is clearly a viable option in various parts of the world. The consideration to produce ethanol from sugarcane is always just under the surface in any country that grows cane. It makes perfect sense. It’s plentiful, it’s relatively low cost compared to grain and is grown in many regions of the world and often on marginal land. The deciding factor is not viability or technology, the issue is the world price of sugar. Between 2006 and 2011, the price of sugar, while having numerous peaks and valleys, has risen from about 18 cents per pound to as high as 29 cents per pound. Given the fact that global demand for sugar is on the increase and current weather conditions are not favorable in Brazil, Russia and some other parts of the world, it does not appear that the price of sugar will be coming down any time soon. A debate has raged for years in the United States regarding the lifting of restrictions on the amount of sugar-based
10 | Ethanol Producer Magazine | january 2012
ethanol that can be imported, particularly from Brazil. On the surface, the argument can be made that ethanol is a global commodity and should be freely traded without restrictions. It could also be said that the establishment of trade barriers disadvantages developing countries economically. But what it really comes down to is supply and demand. This is the primary problem with sugar-based ethanol. Because of high sugar prices, Brazil is now importing ethanol from the United States. This has nothing to do with its capacity to produce ethanol, but is related primarily to the world price of sugar and, more recently, drought conditions. At a current price of nearly 23 cents per pound for raw sugar, it is simply not economically viable for Brazil or any other country to produce ethanol. The Australian sugarcane industry has looked at ethanol for years and to date only one small ethanol plant uses sugarcane as its feedstock. So why would the United States, where it has been deemed strategically important to reduce our dependence of imported oil, move from that dependence to dependence on Brazilian ethanol, rather than continue to develop our own production? Energy security is not just relegated to oil, it’s about energy in all forms. Encouraging greater sugarcane-
to-ethanol production by opening the door to expanded imports has environmental impacts, not the least of which could pose significant land use issues in developing countries. The restrictions currently in place for imported ethanol have served America well and should be maintained. It has encouraged domestic production, while keeping sufficient amounts of imported product to help maintain a stable market. That’s the way I see it!
Author: Mike Bryan Chairman, BBI International mbryan@bbiinternational.com
events calendar
Seeking Speakers for the 28th Annual FEW
Program development is underway for the 28th Annual International Fuel Ethanol Workshop & Expo, being held June 4-7 at the Minneapolis Convention Center in Minnesota. Each year, ethanol producers, researchers, product and service providers and other experts are invited to submit presentation ideas. The process is openâ&#x20AC;&#x201D;simply write a brief description of the proposed presentation and a short biographical note about the speaker, and use to fill in the form available on the conference website at www.FuelEthanolWorkshop.com. The proposed presentations will be reviewed and rated by a committee of ethanol industry professionals, and top-rated abstracts will be used to build program panels in four tracks: Track 1: Production and Operations Track 2: Leadership and Financial Management Track 3: Coproducts and Product Diversification Track 4: Cellulosic Ethanol While many of the same companies and experts return each year to share their latest work, new topics and speakers are welcomed. It is through this open process for submitting presentation abstracts that the FEW remains relevant year after year. The industry professionals who read and rate the abstracts prefer abstracts that offer solid information from reliable professionals of all backgrounds. They look for new ideas and tend to rate those that promise to be infomercials lower. Potential presenters offering innovative ideas or just doing interesting things in the industry are always welcomed. Over 25 percent of last yearâ&#x20AC;&#x2122;s attendees at the FEW were ethanol producersâ&#x20AC;&#x201D;managers, engineers, board members. The largest ethanol conference in the world also attracts the full range of product and service providers to the ethanol industry. Not only is the U.S. and Canada industry well represented each year, but there always is a healthy international attendance. For presenters, it is an opportunity to get in front of potential partners, customers and movers and shakers in the industry. The deadline to submit FEW presentation ideas is Feb. 10. Within a month, the abstracts will be reviewed and speaker notifications emailed. The final program will be completed and posted on www. FuelEthanolWorkshop.com by March 26.
Pacific West Biomass Conference & Trade Show
January 16-18, 2012
International Biomass Conference & Expo
April 16-19, 2012
San Francisco Marriott Marquis | San Francisco, CA
Colorado Convention Center | Denver, CO
With an exclusive focus on biomass utilization in California, Oregon, Washington, Idaho and Nevadaâ&#x20AC;&#x201D;the Pacific West Biomass Conference & Trade Show will connect the areaâ&#x20AC;&#x2122;s current and future producers of biomass-derived electricity, industrial heat and power, and advanced biofuels, with waste generators, aggregators, growers, municipal leaders, utility executives, technology providers, equipment manufacturers, investors and policy makers.
A New Era in Energy: The Future is Growing Organized by BBI International and coproduced by Biomass Power & Thermal and Biorefining Magazine, this event brings current and future producers of bioenergy and biobased products together with waste generators, energy crop growers, municipal leaders, utility executives, technology providers, equipment manufacturers, project developers, investors and policy makers. Itâ&#x20AC;&#x2122;s a true one-stop shopâ&#x20AC;&#x201D;the worldâ&#x20AC;&#x2122;s premier educational and networking junction for all biomass industries.
(866)746-8385 | www.biomassconference.com/pacificwest
(866)746-8385 | www.biomassconference.com
National Ethanol Conference
February 22-24, 2012 Gaylord Palms Resort | Orlando, FL
Since 1996, the RFAâ&#x20AC;&#x2122;s National Ethanol Conference has been recognized as the pre-eminent conference for delivering accurate, timely information on marketing, legislative and regulatory issues facing the ethanol industry. With numerous networking opportunities, pivotal business meetings are conducted that and bring together some of the most influential companies and organizations in the ethanol industry. (202)315-2466 | www.nationalethanolconference.com
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International Fuel Ethanol Workshop & Expo June 4-7, 2012 Minneapolis Convention Center | Minneapolis, MN Evolution Through Innovation Now in its 28th year, the FEW provides the ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-tobusiness environment. As the largest, longest running ethanol conference in the world, the FEW is renowned for its superb programmingâ&#x20AC;&#x201D;powered by Ethanol Producer Magazine. Presentation ideas are being accepted online through Feb. 10. (866) 746-8385 | www.fuelethanolworkshop.com
$*5$
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view from the hill
Out with the Old, In with the New By Bob Dinneen
Perhaps no other year, save 2007 with the enactment of the expanded Renewable Fuel Standard, could surpass 2011 in excitement and innovation in America’s ethanol industry. Despite the best efforts of the Renewable Fuels Association and the industry to enact meaningful tax reforms, the blenders credit for ethanol, known to all as VEETC, will expire at year’s end. While a devastating development just a few years ago, the expiration of the tax incentive will be far less an event in 2012 as industry maturation, market share expansion, and preparation for this expiration have all taken place. To this point, the industry is now supplying 10 percent of the nation’s motor fuel. We are soon moving to 15 percent and beyond. We are also seeing new markets open up overseas as America has become the world’s largest producer, consumer and exporter of fuel ethanol. And, new technologies at existing ethanol biorefineries are being deployed simultaneously with new feedstocks and ethanol production processes that will increase our ability to produce ethanol and expand the economic, environmental, and energy security benefits of domestic renewable fuel production. As important as these innovations are and as serious as the opportunities
and challenges in the year to come will be, it’s always good to take a time and reflect on the year that was. As is tradition, below is the 2012
In and Out list. Please remember, this is done with levity and my tongue firmly implanted in my cheek.
Out
In
VEETC
E15
Imports
Exports
Partisan politics
Congressional gridlock
Cellulose demonstration
Cellulose plant construction
Corn and soybean meal
Distillers grains in livestock feed
Climate legislation
EPA carbon regulation
E15 testing
E15 marketing
Supercommittee
Sequestration
DOE loan guarantees
USDA loan guarantees
BCAP
OFS
Petroleum labeling
E15 labels
Low carbon fuels
Clean fuels
Rail incidents
Safety seminars
CA LCFS
EU RED
Cellulosic Ethanol Coalition
Advanced Ethanol Council
Chinese DDG AD/CVD
EU ethanol AD/CVD
Oil spills
Oil fracking
RFS rulemaking
Tier 3 rulemaking
Ethanol oxygen content
Ethanol octane benefit
RFG surveys
E15 surveys
Food vs. fuel
Speculation driving food inflation
Perry RFS waiver request
Romney/Gingrich RFS support
State E10 mandates
State E15 readiness Here’s to a happy, healthy and prosperous 2012! Author: Bob Dinneen President and CEO of the Renewable Fuels Association (202) 289-3835
12 | Ethanol Producer Magazine | january 2012
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DRIVE
A Year of American Ethanol By Tom Buis
As an advocate for Americanmade renewable energy and a former farmer, I recognize what ethanol has meant for our rural communities—creating jobs and generating enormous economic activity. But, for many outside America’s heartland, firsthand knowledge of ethanol is rare. We have all seen the opinions of those opposed to ethanol that base their arguments on often inaccurate or misleading assumptions. That is why the American Ethanol partnership with NASCAR to use Sunoco Green E15 (a blend of 15 percent ethanol, 85 percent gasoline) is so important. It has been one year since the partnership was formed and throughout the entire 2011 season, NASCAR showcased E15 as the new fuel of choice to American consumers across the country by using it in all three of its national racing series, including the Sprint Cup. The fuel debuted at the Daytona 500 just one month after the U.S. EPA approved E15 for all vehicles built within the past decade—a move that studies prove will create U.S. jobs, improve our environment and strengthen our national security by displacing foreign oil. The decision to approve E15 was based on extensive testing and engine performance
14 | Ethanol Producer Magazine | january 2012
data. As the governing body of one of the nation’s most popular sports, NASCAR’s first concern was to ensure the quality of the racing experience. According to NASCAR officials and drivers, E15 has met and surpassed expectations, providing increased horsepower with no decrease in mileage—proving that American ethanolblended fuel works in the most challenging engine environment. In an October interview with Fox News, NASCAR CEO Brian France said, “Fuel mileage has been great, the performance of the fuel… If it can withstand the test of the 500 miles of the closest competition under extreme circumstances, it will work anywhere and it does, and we are proving it every Sunday.” NASCAR officially hit the 1 million mile mark with the new fuel at Watkins Glen International Speedway in midAugust. Shortly after, NASCAR released a Million Miles report validating E15’s qualities as a fuel. NASCAR racing vehicles accumulated more than a million miles of practice, qualifying and racing laps on E15—with no problem, no issues, and in fact, greater return in horsepower. The American Ethanol partnership and the million mile landmark is helping NASCAR to go green and educating millions of consumers about the economic, environmental and national security benefits of ethanol. In November, NASCAR hosted a daylong Green Summit to call attention to its environmentally
responsible efforts. Mike Lynch, managing director of green innovation for NASCAR, said at the start of the summit, “Successfully transitioning to the new fuel and surpassing a million miles, all on America’s toughest proving ground, is a validation of Sunoco Green E15 as a high-performance racing fuel and is part of our overall effort to go green. NASCAR is proud to use this American-made product because it creates American jobs while also reducing harmful emissions.” Domestic ethanol is the key to making our nation energy independent. Every gallon of clean, renewable ethanol that we produce in this country decreases the demand for foreign oil and keeps U.S. money in the U.S. economy, where it can create U.S. jobs, instead of creating jobs overseas. There are still many regulatory hurdles that must be addressed before E15 is available at the pump for all Americans. But NASCAR’s adoption of E15 should help encourage all American motorists to embrace ethanol as a high octane fuel that provides quality performance, reduces harmful emissions and frees us from our costly dependence on foreign oil. Author: Tom Buis CEO, Growth Energy (202)545-4000 tbuis@growthenergy.org
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It’s January 2012, Do You Know Where Your Industry Is? By Ron Lamberty
Most people see the beginning of a new year as a time to look into the future and forecast what might happen. In the process, they read articles like this one because they are curious to see if others share their opinions. With so many changes that will, should and could take place for ethanol this year, the only honest prediction is that 2012 is difficult to predict. In other words, you and I are on the same page if your opinion is “I don’t know.” A year ago, an extension to the Volumetric Ethanol Excise Tax Credit had been passed, and ethanol supporters were hopeful that we could transition to policies that improve fuel choice and reduce the cost of policies most ethanol opponents objected to. Last year’s January columns probably predicted an end to VEETC over a period of time, and changes to infrastructure policies. No one expected the period of time to be a few months, and the changes to be aggressive attacks on every thin dime that might benefit ethanol in any way. And did anyone predict the new love affair with Big Oil, the kid gloves treatment of oil’s subsidies, and the revival of “drill, baby, drill?” Whatever you thought last January, sometime in 2011, years of public relations efforts—paid for by people with financial motives and no regard for science or
16 | Ethanol Producer Magazine | january 2012
truth—took hold and created an “alternative reality” of inaccurate (but widely held) beliefs about ethanol. Even the staunchest ethanol supporters were powerless to beat back the tide of misinformation, and ethanol opponents avenged years of pent-up frustration by riding the wave of anti-ethanol sentiment to sweeping policy change. Those opponents will continue to push for further change and, ironically, the good news may be that there is almost nothing left to take. Sure, they’ll come after the renewable fuel standard (RFS), but the RFS was created to reduce air pollution, decrease oil imports and cash exports, increase domestic energy production and create good jobs, and it has done all of that. Eventually, someone will recall that the anti-ethanol crowd claimed VEETC was the real problem, and that’s gone. Pushing harder should make it clear that this is not really about the noble sounding fictional reasons used, because “cheap corn” and “less competition for oil” don’t inspire a lot of support. It isn’t all bad news. Ethanol’s octane will continue to be valuable to refiners. They can make more gasoline from a barrel of oil if they can make 84 octane gas and use ethanol to blend it up to 87 octane “regular.” Oil companies make money selling ethanol, and they like to make money. E15 was approved by EPA based on science, and although the scare tactics used to attack it have gotten attention, there are petroleum marketers who want to be able to offer E15. They want to install
blender pumps and give multiple options to their customers. Once a fuel like E15 is an option, consumers will try it, and will see that nothing will happen to their cars. Then, just as it has with every other ethanol blend that has ever been introduced, E15 will become the fuel of choice for more motorists every year. There are even more positive possibilities beyond this year, as people concerned about health problems associated with fossil fuels, and car companies that need to meet new CAFE standards might be able to find common ground with a higher blend of ethanol. More ethanol means higher octane for lighter, higher compression engines that can provide better mileage while decreasing the type of gasoline emissions that are most harmful to people. Ten years ago, after the worst pummeling of his boxing career, a reporter asked Mike Tyson what the future held for him. Tyson said, “I don’t know man, I guess I’m gonna fade into Bolivian.” After a tough 2011, ethanol’s opponents want us to be just as punch-drunk and defeated as Tyson was after that fight. They will be disappointed that we’re not. . . . and now that I think about it, Bolivians have an ethanol requirement, don’t they? Author: Ron Lamberty Senior Vice President, American Coalition for Ethanol (605) 334-3381 rlamberty@ethanol.org
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Europe Calling
Are European Producers Overreacting? By Robert Vierhout
For many, it may have come as a surprise that the European ethanol industry asked the European authorities to take action against U.S. ethanol imports. Unfortunately, the European producers had no other option but to act for a number of reasons. U.S. import increases were hitting triple digits last year and still growing this year. In spite of higher mandates/ targets in the EU, the market share of EU producers has not been increasing as it should have been expected. The very low prices quoted for U.S. ethanol are driving down the prices on the EU market. For European producers, this situation has undermined profitability and, for some, closure of installations. Using the trade tools in the European law against unfair imports is the strongest and, hopefully, the most effective measure the industry can deploy. After a 45-day examination of the evidence submitted by the European ethanol industry, the European Commission decided a formal investigation is justified to determine whether U.S. subsidies are causing injury to the EU ethanol industry. A second investigation will look into whether ethanol was dumped on the EU market. Member states expressed the opinion that investigations are indeed legitimate.
18 | Ethanol Producer Magazine | january 2012
I could well understand that many American producers believe the Europeans are overreacting. And why an investigation now, when the Volumetric Ethanol Excise Tax Credit is about to become history? The decision to complain and ask for an investigation was not an easy one. Besides the additional burden of high legal fees, the investigation will put pressure on the European/American ethanol industry relationship. After all, if countervailing duties were put in place, U.S. ethanol producers would not be exporting to the EU for at least five years. And if the EU authorities find our request for retroactive application of countervailing duties justified, EU customs would claim these for the European coffers. Whether VEETC will still be there next year, in whatever shape or form, is irrelevant. The investigation will focus on the time frame covering the last quarter of 2010 and the first three quarters of 2011 when subsidies were undeniably present. Whether U.S. producers intentionally pursue ethanol exports, or whether these exports are the result of a clever scheme of clever traders, exporters or importers, is irrelevant too. For the European ethanol industry there is only one thing that counts—were the imports done fairly or not? We believe it is not fair when there is as much subsidy involved as in the U.S. case. It would be regrettable, however, if this trade dispute undermined the
constructive relationship producers have built over years between the U.S., Canada and Europe to create an ethanol voice at global level. Within the Global Renewable Fuels Alliance, we are working on a common political agenda to send signals to the international community and our respective politicians and regulators that the use of biofuels should be promoted. That agenda is still there, trade dispute or not. Discussing trade issues at the global level has always been sensitive. It was the main reason that the Brazilian ethanol producers did not want to join the Global RFA. Maybe it is time for them to rethink their position. The Brazilian ethanol industry did not fight U.S. imports because less ethanol on the Brazilian market would mean more gasoline on the market and higher ethanol prices. What is happening in Brazil underlines what the agenda of the global ethanol industry should be—growing ethanol’s market share as a transport fuel with trading occurring whenever a region is short on ethanol supplies. As the Renewable Fuels Association’s Bob Dinneen once said, “We are not here to cannibalize each other’s markets.” Are we? Author: Robert Vierhout Secretary-general, ePURE Vierhout@epure.org
business matters
Natural Gas vs. Energy Innovation By Kate Bechen
The production of ethanol is a complex, energy intensive process. Critics often cite the energy
usage of ethanol plants and the wastes produced by the production of ethanol, especially corn-based ethanol, as lessening the benefits of ethanol production. But many ethanol plants are challenging these criticisms head on by leveraging efficiencies to reduce water use, utilizing renewable energy sources in production or recovering waste heat. Some ethanol plants are installing (or have installed) biomass boilers, gasifiers, anaerobic digesters or heat reclamation technologies; all with the purpose of reducing the amount of energy used per gallon of ethanol produced. Ethanol production facilities consume a significant amount of energy. About 90 percent of total energy consumed in the production process is thermal. The steam is needed for the starch conversion process, distillation and evaporation. Typically, the thermal energy is produced from fossil fuels (mostly natural gas but sometimes coal). Given that fossil fuels are not renewable resources, decreasing their use contributes directly to the net energy benefit derived from using ethanol rather than fossil fuels. After feedstock costs, energy costs have the greatest impact on the financial viability of an ethanol production facility. In 2009-’10, the energy costs per gallon of ethanol produced were estimated between 15 to 21 cents. But since then the cost of natural gas has decreased significantly. Regardless of whether natural gas prices remain at their current low
20 | Ethanol Producer Magazine | january 2012
rates (in fact the U.S. Energy Information Administration expects low rates could continue for the next decade followed by a gradual increase), if the goal (or at least a goal) is to establish a domestically grown fuel without reliance on unsustainable fossil fuels, then technology innovations are needed to wean our ethanol plants off natural gas. In addition, some in the industry simply don’t believe that natural gas prices will remain low for the foreseeable future and are preparing for higher-than-expected prices. Even if natural gas prices remain low, the U.S. EPA and state environmental policymakers may establish sustainability requirements to push ethanol producers to use advanced technologies that require less natural gas. Efforts are already underway in California; and where California goes, often other states follow. Some facilities are hedging their bets by beginning the process of installing alternative energy sources, but doing so over a longer timeframe than they may otherwise have done if natural gas prices had not dropped. Some energy efficiencies are gained by leveraging opportunities within local markets. Having a wet distillers grain purchaser in the local market significantly reduces energy needed to dry this valuable coproduct. Plants that are located close to an energy feedstock realize significant reductions in transportation costs. Poet LLC, for example, employs a solid waste fuel boiler at one biorefinery that consumes several hundred tons of waste wood chips each day, which would otherwise be headed to a landfill. The boiler also burns methane gas received via a pipeline
from a local landfill. Other producers, such as Ace Ethanol LLC, have installed heat exchange equipment to reclaim waste heat. Recently, scientists from the USDA have used a commercial enzyme developed by Genecor to extract water from distillers grains, significantly reducing the amount of energy and water needed for ethanol production. The study showed that using the enzyme by mixing it with the stillage before entering the centrifuge reduced the energy needed to dry the stillage into suitable DDGS by 14 percent. This is due to the enzyme’s ability to enhance the water extraction process. Further, the scientists estimated that use of the enzymes would reduce water use by 10 percent, electricity consumption by 2.4 percent and natural gas consumption by 12 percent. Ethanol facilities are businesses. While being “green” is certainly important to everyone in the industry, staying out of the “red” and in the “black” is also a fundamental concern. The low price of natural gas will likely have an impact on the implementation of technology innovations that reduce energy used in the production process. But given the numerous technology advancements and the national push for a domestic fuel supply that doesn’t rely on fossil fuels, we will continue to see the development and utilization of innovative technology designed to reduce the industry’s reliance on natural gas. Author: Kate Bechen Attorney, Michael Best & Friedrich LLP’s Energy & Sustainability Industry Group (414) 225-4956 klbechen@michaelbest.com
work as hard as you do Call 1-800-847-5311 for information or visit www.genencor.com
business briefs
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Canadian waste-to-biofuels developer, Enerkem Inc., has expanded its executive team and added two directors to its board. Jim Conner will oversee engineering, global supply chain and project management, as well as plant operations as Enerkem’s senior vice president, operations. He spent most of his career at Celanese Corp., most Operations Expertise recently as vice president, Jim Conner brings global operations and more than 25 years technology. He was also of experience in operations to his responsible for process new position on the and project engineering, executive team at Enerkem. research and development. Based in the Netherlands, Anton de Vries brings three decades of experience in fuels and chemicals, having worked more than 18 years with Royal Dutch Shell and 11 years with LyondellBasell, the world’s third largest independent chemicals producer. Larry MacDonald is joining the board, bringing his 30 years of experience at NOVA Chemicals Corp. in senior executive functions.
Ineos Bio has launched a licensing program for its waste-to-bioenergy technology and selected global engineering firm AMEC to be its license support engineering firm. The technology is based on a modular design, which allows for varying sized plants to match feedstock supplies, beginning with an 8 MMgy cellulosic ethanol size. The first 8 MMgy plant is being built by Ineos New Planet BioEnergy LLC and is expected to be in production in the second quarter in Vero Beach, Fla. Vogelbusch USA has received the contract to supply the ethanol distillation and dehydration equipment for the facility. BlueFire Renewables Inc. will make its technology available for licensing through a newly formed subsidiary, SucreSource, which will focus on providing front-end cellulosic sugar capabilities to companies with back-end fermentation, bio-reactor and catalysis processes. “Backend biochemical and biofuel processes need lowcost, nonfood cellulosic sugars for widespread commercialization, whether the end product be ethanol, biobutanol, ethyl levulinate, etc,” said CEO Arnie Klann. According to BlueFire, its concentrated acid hydrolysis technology process offers an 85 percent or better conversion rate and can be used with multiple feedstocks. The technology allows for xylose, glucose or other sugars to be isolated and delivered.
Scott Peterson, Interstate Co. chief financial officer and president of Harbor Group, was recently named to the Federal Reserve Bank of Chicago’s advisory council on agriculture, small business and labor. With his perspective as a construction industry business leader, he will Eco-Energy Inc., a biofuel supply chain provide input regarding general economic and company headquartered in Tennessee, will prolabor conditions in northwest Iowa. vide corn procurement and ethanol marketing services to the 50 MMgy Utica Energy LLC Lallemand Ethanol Technology has ap- ethanol facility located in Oshkosh, Wis. The pointed Charl Goosen its new general manager companies entered into a three-year integrated succeeding Bill Nankervis who is now president margin management agreement, which calls for of the company’s specialty division businesses. Eco-Energy to assess the entire cost of Utica Since 2003, he has been general manager of Energy’s ethanol production. Eco-Energy proPioneer Foods Group’s SASKO Bakeries busi- vides supply chain services to 14 biofuel producness in South Africa. Based in Milwaukee, Wis., ers in North America, with the majority located LET is a business unit of the Canadian yeast in the Corn Belt. The company reports over $3 and bacteria producer Lallemand Inc. billion in sales, handling nearly 10 percent of the biofuels market.
22 | Ethanol Producer Magazine | january 2012
BUSINESS BRIEFS
Sponsored by
REX American Resources Corp. increased its ownership share to 98 percent in NuGen Energy LLC, a 100 MMgy ethanol plant in Marion, S.D. Using cash on hand, REX completed the additional 50 percent investment with Central Farmers Cooperative LLC, a locally owned farmers cooperative that retained 2 percent ownership. Continuing to increase its investment in ethanol, the NuGen acquisition increases REX’s stake in several ethanol plants by about 30 percent, from a nameplate production capacity of 169 MMgy to 219 MMgy. Lincoln Energy Solutions will nearly triple
Share your industry briefs To be included in Business Briefs, send information (including photos and logos if available) to: Business Briefs, Ethanol Producer Magazine, 308 Second Ave. N., Suite 304, Grand Forks ND 58203. You may also fax information to (701) 7468385, or e-mail it to sretkaschill@bbiinternational.com. Please include your name and telephone number in all correspondence.
Partners and Spring Ventures. Two independent members also joined the board, Ross Pillari and Charles Shaver. Pillari held positions with BP for 35 years, including chairman and chief executive officer of BP America Inc. He currently serves as an advisory board member to CVC Capital Partners, Inc. Shaver has three decades of experience in the chemicals industry, most recently serving as president of The TPC Group, Inc. Saskatchewan-based Nipawin Biomass Ethanol New Generation Co-operative Ltd. has contracted with the Saskatchewan Research Council to further develop its catalytic process for cellulosic ethanol production. When operational, Nipawin Biomass intends to process waste timber and farm residues into ethanol. The proposed 100 MMly (26 MMgy) ethanol plant will require approximately 200,000 dry metric tons of cellulosic material annually. California-based Fulcrum BioEnergy Inc. is integrating the catalytic conversion process developed by SRC and Nipawin Biomass into its proprietary technology of converting municipal solid waste into ethanol. Fulcrum’s first commercial-scale plant is projected to begin construction this year.
its ethanol and biodiesel transportation services. Headquartered in Greenville, S.C., Lincoln Energy delivers to locations in South Carolina, North Carolina—including an ethanol transload center in Greensboro—plus Georgia and Tennessee, with future locations in Florida and Virginia. In Marquis Energy LLC announced it will addition, the company operates a unit train facil- install two Indeck boilers at its biorefineries in ity in Belton, S.C. that is leased to Archer Daniels Necedah, Wis., and Hennepin, Ill. The additionMidland Co. al steam supply and system redundancy will allow both Marquis plants to continue expanding ZeaChem Inc. has signed an agreement capacity and output. with California-based ethanol producer Pacific Ethanol Inc. to provide operations, mainteAshland Water Technologies, a commernance and accounting services for ZeaChem’s cial unit of Ashland Inc., has introduced two 250,000 gallon per year demonstration cellulosic new corn oil extraction aids. DPM-399 provides ethanol facility in Boardman, Ore. ZeaChem’s an entry point to improving corn oil yield, acdemo plant is scheduled to begin producing cording to the company, while DPI-428, a midbio-based chemicals by the end of this year us- range product, delivers greater corn yields. Its ing hybrid poplar as its primary feedstock, with first extraction aid, the premium PTV M-5309, cellulosic ethanol production to follow. In late was introduced in September 2010, and provides October, ZeaChem announced it has raised $19 the maximum yield improvement and highest million in Series C financing, led by Birchmere corn oil quality. All three extraction aids improve Ventures. Birchmere partner Sean D.S. Sebas- the release of corn oil during centrifugation by tian also joined the ZeaChem board. Follow-on modifying the surface chemistry of solids and oil investment was provided by existing investors micelles in the syrup. Oil in the treated syrup is Firelake Capital, Globespan Capital Partners, more easily released and less centrifugal energy is Mohr Davidow Ventures, PrairieGold Venture required to separate the oil from the syrup.
january 2012 | Ethanol Producer Magazine | 23
commodities Natural Gas Report
Electric marketplace differs greatly from gas Nov. 29—The electric marketplace is different than natural gas. First, most electric consumers are required to purchase supply from the local electric utility at the price specified by the utility. Second, electric utilities are subject to unique regulatory requirements, such as renewable portfolio standards (RPS). Third, electric utilities generate a substantial amount of electricity from coal, which is currently in the U.S. EPA’s crosshairs. Fourth, quality requirements are increasing as onsite customer computer and control technology requires tighter voltage tolerances and minimal “blips.” Finally, a greater percentage of electric costs are related to nonfuel, fixed investments such as generation plants and transmission lines, compared to the gas industry. These differences create divergent price paths. Over the past five years, average an-
nual natural gas prices have dropped more than 40 percent from $6.86 per million Btu in 2007 to roughly $4 in 2011, while industrial electric rates increased by 4 percent from 64 cents per kilowatt hour to 67 cents, illustrated in the accompanying chart. We expect electric rates will continue to go up. RPS and EPA compliance costs will continue to grow. And, while electric rate pressures have actually been dampened by lower natural gas prices, if natural gas prices do begin moving up, they will be reflected in future electric rates. Finally, since the electric market tends to be
By Casey Whelan
more capital intensive, higher interest rates will add cost pressures as the economy recovers. In summary, electric prices will not likely be volatile, but will likely see increases above the rate of inflation.
Corn Report
Reluctant sellers, outside factors create volatility Nov. 29—Producers have been slow to market as summer’s higher prices fade, remaining bullish in the new year. Export demand has been lackluster as competitive feed ingredients enter globally. Outside markets have wreaked havoc. The EU debt crisis strengthened the U.S. dollar, putting pressure on U.S. commodities. An overall slowdown in other economies has dampened demand. No event-changing news came in the November supply/demand report. Acreage was unchanged while yield was lowered to 146.7 bushels per acre compared to 148.1 in the October report and 152.8 last year. Production was lowered by 123 million bushels. Feed and residual demand decreased, although ethanol and export demand were left unchanged at 5.0 and 1.6 billion bushels respectively. Last year’s ethanol and export demand were 5.021 and
1.835 billion bushels respectively. This year’s carryout is 843 million bushels, a 6.7 percent carryout-to-use ratio. Globally, corn carryout decreased from 123.19 to 121.57 million metric tons due to reduced U.S. and Mexico production. While China and EU production was higher, both are expected to see increased domestic demand. The accompanying chart illustrates the current USDA corn carryout and carryoutto-use ratio. This year would be one of the lowest carryouts in recent times, if it comes to fruition. Last year in November, the projected carryout was 827 million bushels, 6.2 percent
24 | Ethanol Producer Magazine | january 2012
BY JASON SAGEBIEL
carryout-to-use ratio, but the marketing year ended with a 1.128 billion bushel carryout for an 8.6 ratio. Market rationing led to a gradual increase in carryout during the course of the year.
report
Regional Ethanol Prices Front Month Futures (AC) $2.4780 REGION
SPOT
RACK
West Coast
$3.010
$3.035
Midwest
$2.840
$3.000
East Coast
$2.940
$2.201 SOURCE: DTN
Regional Gasoline Prices
DDGS Report
DDGS price softens, demand weakens BY SEAN BRODERICK Nov. 29—At year end, DDGS prices are feeling the effects of corn futures dropping, cheaper soymeal, and more normal supplies. With canola getting cheaper on the West Coast, and feed wheat being cheap on the East Coast, bids have been dropping fast. As a percentage of corn, prices have been around a normal low- to mid-90s, down from over 100 percent just a few weeks ago. DDGS exports are off about 13 percent year over year, with most leaving the U.S. in containers, rather than boats, to the Chinese market. While exports to South Korea and China are also off, we still have strong demand from Mexico, Canada and Vietnam. Container supply is getting to be an issue, with DDGS competing for empties with corn and
soybean, as well as the inbound holiday shipment dynamic ending. The one-year anniversary of the Chinese anti-dumping case is here with no resolution. It has been interesting to see the process, and a country’s realization that DDGS really does trade on its own merits, subject to the vagaries of worldwide competition. We may yet see some kind of imposed duty, but given how quiet things have been, we wonder. Europe just announced the same type of case against the U.S., although more ethanol oriented. The market appears to have more to sell, and buyers are not as excited about buying as in recent weeks. With alternatives out there, prices ahead will be more demand driven.
Front Month Futures Price (RBOB) $2.5181 REGION
SPOT
RACK
West Coast
$2.582
$2.827
Midwest
$2.435
$2.574
East Coast
$2.551
$2.687 SOURCE: DTN
DDGS Prices ($/ton) location
Jan 2012
dec 2011
Minnesota
195
208
jan 2010 145
Chicago
227
227
165
Buffalo, N.Y.
232
232
162
Central Calif.
260
278
201
Central Fla.
232
246
180 SOURCE: CHS Inc.
Corn Futures Prices Date
Low
Close
6.03
5.86
5.91 3/4
6.68 1/4
6.57 1/2
6.67
4.15
3.95
4.13 1/2
Nov. 28, 2011 October 28, 2011
(March Futures, $/bushel)
High
Nov. 29, 2010
SOURCE: FCStone
Cash Sorghum Prices ($/bushel) LOCATION
Ethanol Report
Tight ethanol supplies counter sluggish gasoline demand BY RICK KMENT Nov. 29—The gasoline and ethanol markets are at a bit of a crossroads heading into the end of 2011. As traders are looking for increased blending activity and are able to offer premiums for product, especially in high population areas such as the coastal metro areas, supplies of ethanol are being actively sought by traders both in the rack and spot markets. This has continued to push ethanol rack and spot prices sharply higher, at a time when ethanol futures prices, corn prices and RBOB gasoline price levels have all quickly turned lower. It is still too early to tell just how long this strong surge of reported tight supplies by end users
of ethanol will last, but for now, wholesale and retail premiums are holding extremely well due to the direction of the futures market. The main concern looking forward for the ethanol market is if the gasoline market continues to struggle with what is expected to be lagging demand. No matter how tight or plentiful the ethanol supply level is, the demand for ethanol continues to be strongly tied to the overall demand for gasoline as most of the ethanol is used as a blended fuel. So, if economic concerns and seasonal weakness in the market continue to cut overall demand for gasoline, ethanol demand will follow in time.
nov 28, 2011
oct 28, 2011
nov 24, 2010
Superior, Neb.
5.77
6.33
4.94
Beatrice, Neb.
5.62
6.21
4.79
Sublette, Kan.
5.67
6.26
4.66
Salina, Kan.
5.99
6.60
4.89
Triangle, Texas
5.56
6.19
4.91
Gulf, Texas
6.70
6.93
4.89
SOURCE: Sorghum Synergies
Natural Gas Prices
($/MMBtu)
LOCATION
dec 1, 2011
nov 1, 2011
dec 1, 2010
NYMEX
3.36
3.52
5.03
NNG Ventura
2.89
3.77
4.44
CA Citygate
3.60
3.85
4.58
SOURCE: U.S. Energy Services Inc.
U.S. Ethanol Production
(1,000 barrels)
Per day
Month
End stocks
Sept. 2011
888
26,645
18,437
Aug. 2011
907
28,110
17,900
Sept. 2010
874
26,221
17,437
SOURCE: U.S. Energy Information Administration
january 2012 | Ethanol Producer Magazine | 25
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Ethanol News & Trends
Export Upset From 2008 to 2010, U.S. ethanol exports to Europe increased by 500 percent. 2011 exports are expected to be double the 2010 figure.
Under the Microscope
EU joins China in investigating U.S. ethanol trade practices With the U.S. market for ethanol essentially capped at 10 percent, ethanol producers have been exporting both ethanol and distillers grains in increasing numbers the past few years. Whether that’s a positive or a negative depends on who is asked. At the end of November, the EU joined China in launching investigations into the matter. As requested by ePURE, the European Producers Union of Renewable Ethanol, the European Commission launched anti-dumping and anti-subsidy investigations. China announced an anti-dumping investigation into U.S. dried distillers grains with soluables (DDGS) at the end of 2010, the results of which are as yet unknown. The deadline to wrap up the anti-dumping investigation is 15 months and 13 months for the anti-subsidy investigation, says Rob Vierhout, secretary general of ePURE. After nine months, the EU can impose provisional measures, such as raising tariffs. “Tariffs will only be raised if the European Commission finds enough evidence for it,” he tells EPM.
“That is why a nine-month period of investigation is needed. You may understand that the European Commission wants to check what the EU producers are saying.” The European Producers Union of Renewable Ethanol said Nov. 2 that it was confident the investigation will “clearly establish the need to impose dissuasive duties on U.S. imports of fuel ethanol” and also requested that U.S. imports be registered so duties could be imposed retroactively. Essentially, the European ethanol industry is asking for additional import duties to “undo the effect of the competitive advantage” enjoyed by a subsidized U.S. ethanol industry. “Massive and sudden imports of U.S. ethanol, combined with unfairly low prices over the past few years, have seriously damaged the economic situation of European producers,” Vierhout says. “The unfair competition of U.S. imports is simply depriving the EU industry from the benefit of this positive evolution on its own domestic market,” he says, adding that it’s critical to resolve the situation as EU counties are rapidly increasing consumption of renewable fuels, resulting in a potentially bright future for EU producers. Although there are other factors, the main concern is that U.S. ethanol is benefiting from the U.S. Volumetric Ethanol Excise Tax Credit, or the 45-cents-per-gallon blenders credit, and then entering the EU. VEETC is widely expected to expire at the end of 2011.
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The Renewable Fuels Association says it would work with other industry groups to encourage domestic ethanol producers to cooperate with the investigations. The group also says it will work to make sure the industry isn’t penalized unjustly. “Importantly, domestic ethanol producers are not eligible for VEETC,” the RFA says. “That tax incentive is specifically made available to gasoline blenders, marketers, and other end users. Therefore, we believe that U.S ethanol producers should not be the focus of any potential European action. Moreover, VEETC will expire at the end of 2011, rendering the VEETC portion of this investigation and complaint irrelevant moving forward.” RFA has said repeatedly it does not believe that U.S. ethanol is being blended in the U.S., taking advantage of the 45 cent per gallon incentive known as VEETC. “Based upon our research and work with the International Trade Commission, the RFA has neither discovered nor been provided any evidence by the EU or any other entity that such ethanol trades are occurring,” RFA says. U.S. ethanol is being exported in increasing numbers because it is the lowest cost ethanol on the market currently, the RFA counters. “To be clear, all ethanol producing nations and regions provide incentives,” RFA says. “Nations of the European Union are no different.” —Holly Jessen
PHOTO: HOLLY JESSEN, BBI INTERNATIONAL INC.
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FFV Support Although more than 9 million vehicles on the road today are flex-fuel, many consumers don’t realize their vehicle is an FFV and that they can fuel up with E85.
E85 Coalition Ranks Swell SIGMA joins group seeking alternative fuel credit
A group of E85 supporters has big dreams on a short timeline. The Coalition for E85, newly formed in October, wants to see E85 counted on a list of alternative fuels including compressed natural gas, propane and hydrogen that receive a 50-cent-per-gallon tax credit through the Alternative Fuel Credit. “E85 is not only an alternative fuel, it is our nation’s most widely adopted alternative fuel,” says Matt Horton, CEO of Propel Fuels, one of the lead members of the Coalition for E85. “If we are to make a meaningful dent in our dependency on foreign oil, we must expand E85 infrastructure and ensure this fuel has fair tax treatment.” With the expiration of the 45-cent-pergallon Volumetric Ethanol Excise Tax Credit expected at the end of the year, the Coalition for E85 predicts millions of flex-fuel vehicle owners will pay as much as 38 cents a more per gallon for E85. The coalition believes the increase will force many small businesses to close their E85 pumps—after investing more than
$100 million in infrastructure to install those pumps. “It’s clearly at a point where ethanol as an additive—E10, E15—can go on without much in a way of subsidy,” says Jeff Trinca, vice president Van Scoyoc Associates, which has been hired as a lobbyist for the coalition. “The problem is that the E85 folks are saying, ‘We’re just a baby, we’re just starting out.’” The newest member of the group, the Society of Independent Gasoline Marketers Association of America agrees. “Many of our members have made a significant investment to bring convenient access to E85 to our customers and they’ve responded by filling up tank after tank with E85,” says Tim Columbus, general counsel for the nonprofit, national trade association. “SIGMA believes that we cannot abandon E85 this close to self-sustainability, especially when everyone from auto makers, to retailers and consumers are supporting this domestically produced fuel. We’re joining the coalition to let our government leaders hear why providing access to American-made fuels is critical to building our nation’s economy.” SIGMA represents 250 corporate members that hold 30 percent of the petroleum retail market and sell more than 56 billion gallons of fuel yearly. The Petroleum Marketers Association of America, which represents 8,000 independent petroleum marketers nationwide, joined the group in late October. “If we don’t enable E85
to compete with gasoline, we could see the entire flex-fuel industry disappear,” says Dan Gilligan, PMAA president. “Our members, automakers, and 9 million American drivers have invested in E85 infrastructure and flex-fuel vehicles. With E85 so close to self-sustainability, these investments must be protected.” Today, only 2,700 retail stations offer E85 nationally, Trinca says. In order for more drivers to fuel up with E85 and more stations to provide it, it has to be priced attractively. “How do you make sure that we go from 2,700 stations to 35,000 stations in the next few years?” he asks. “And if the price point is too high, are the stations going to be able to make the investment going forward?” Current supplies of E85 are derived from first-generation ethanol. As the industry moves forward, it can be produced from nonfood sources such as agricultural and household waste, algae and biomass. “Without the E85 system, the federal government’s investment in the development and commercialization of next-generation biofuels may be wasted,” according to the coalition press release. The Coalition for E85 currently includes Propel Fuels, Protec, Pearson Fuels, Clean Fuels Development Coalition, multiple ethanol industry associations, pump and tank companies, and individual E85 retailers. —Holly Jessen january 2012 | Ethanol Producer Magazine | 29
IMAGE: U.S. DOE - OAK RIDGE NATIONAL LABORATORY
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Busy, Busy This cartoon-like image provides a representation for the internal motions coupled to the catalytic step of the enzyme Cyclophilin A.
In Motion
Researchers investigate enzyme movement to improve ethanol production Scientists at the U.S. DOE’s Oak Ridge National Laboratory are combining fundamental knowledge of enzymes and new discoveries regarding their movement to potentially improve the ability to produce cellulosic ethanol and perhaps cure some of the world’s most notorious diseases. “The importance of the structure of enzymes has been known for more than 100 years, but only recently have we started to understand that the internal motions may be the missing piece of the puzzle to understand how the enzymes work,” says Pratul Agarwal, ORNL staff scientist. Using ORNL’s supercomputer, known as Jaguar, Agarwal and postdoctoral researcher Arvind Ramanthan investigated 12 enzymes at an atomistic scale and found that all enzymes have similar motions. “If something is important for function, then it will be present in the protein performing the same function across different species,” Agarwal says. “For example, regardless of which company makes a car, they all have wheels and brakes.” Jaguar allowed Agarwal and Ramanthan to complete their investigation of enzymes in about one month, compared to the several years it would have taken otherwise. Their findings also showed that enzymes possess
so-called knobs, which Agarwal says can be tweaked to improve the enzyme’s performance. “When we investigate the motions, we discover knobs on the enzymes which can be tuned to increase the efficiency,” he says. “Understanding the dynamics of the enzymes gives us control of the catalytic efficiency of the enzyme.” Researchers will continue to identify various pathways, Agarwal says. Additionally, he and Ramanthan are involved in preparing a spin-off company that will build on their discovery, eventually allowing the technology to become commercially available. In late November, Agarwal said discussions were under way with ORNL’s technology transfer division to determine whether the company will be privately held. He anticipates that the company will be launched by May. The enzyme work conducted by Agarwal and Ramanthan could be useful not just for biofuels, but perhaps even more importantly for creating medicines that can cure diseases such as AIDS, he says. Agarwal previously identified a network of protein vibrations in the enzyme Cyclphilin A, which is involved in many biological reactions, including AIDS-causing HIV-1. The results of Agarwal and Ramanthan’s research have been published in a paper titled “Evolutionary conserved linkage between enzyme fold, flexibility and catalysis” in PLoS Biology, a peer-reviewed scientific journal. Funding for their research was provided by ORNL’s Laboratory Directed Research and Development program. ORNL is managed by UT-Battelle for the DOE’s Office of Science. —Kris Bevill
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Good News, Bad News
Farmers harvest biomass, delivery on hold
First, the good news. In preparation for cellulosic ethanol production at the Poet Biorefining ethanol plant in Emmetsburg, Iowa, farmers harvested 61,000 bone dry tons of corn crop residue in the form of bales of corn cobs and light stover. That represents an increase of 15 contracts and 5,000 tons from the 2010 harvest, Poet says. Now, the bad news. Nearly 100 farmers are awaiting word on the status of the Biomass Crop Assistance Program before actually delivering the biomass bales. As of the end of November, it was unknown if BCAP would be included in the 2012 federal budget. Poet is gearing up for cellulosic ethanol production at Project Liberty, a 25 MMgy ethanol plant scheduled to start producing in 2013. Grading and construction of a Biomass Harvest second weigh station by the Numbers is under way. Heavy construction will be2010: 56,000 tons gin in 2012. The com2011: 61,000 tons pany says it will need Goal: 285,000 tons 285,000 tons of biomass yearly to operate the cellulosic ethanol plant. “Biomass harvesting is moving along as planned, and I’m confident we’ll have a large and consistent supply of corn cobs and light stover once Project Liberty is running,” Poet founder and CEO Jeff Broin says. “Both the farmers and Poet Biomass personnel have learned a lot in the last few years about best practices in biomass harvesting, and that experience will pay dividends.” By harvesting biomass before Project Liberty is operating, Poet hopes to streamline the process to harvest, store and deliver biomass. The company plans to use about 300 to 400 bales for biomass storage research at Poet’s 22-acre stackyard and may use another 1,500 bales for additional research. Some of the harvested biomass will be used as feedstock at the company’s pilot cellulosic ethanol plant in Scotland, S.D. “Research is paramount to what we’re doing in Emmetsburg,” Project Liberty Director Jim Sturdevant says. “Not only do we have to keep a consistent flow of biomass to the facility, we need to ensure that farmers know how to harvest in a manner that maintains soil health.” —Holly Jessen
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Forging Ahead Enterprising retail operators install E85 pumps despite pricing uncertainties
Retailers are concerned about increasing E85 prices as a result of the Volumetric Ethanol Excise Tax Credit’s expiration, says Todd Garner, CEO of Boca Raton, Fla.-based ethanol marketer and distributor Protec Fuel Management LLC. But that’s not stopping some of them from installing E85 pumps. In the past five years, Protec has assisted in the installation of about 30 E85 pumps each year, on average. In the second half of the year, the company had helped install 20 pumps by late November, all located predominantly at retail stations in the Southeast. “I think people are concerned about VEETC, but we keep them informed as to what’s transpiring,” he says. In general, E85 prices have been trending about 30 cents less per gallon than unleaded gasoline in the Southeast, according to Garner. Without the benefit of the 45-cent-per-gallon tax
credit provided to blenders through VEETC, it’s possible that E85 could become more expensive than gasoline, a scenario that many believe would result in the end of the E85 market. “Customers have gotten used to those discounts, so we’re trying to keep them informed that after Jan. 1 this could drastically change,” Garner says. “I hope it doesn’t end up where E85 in the Southeast ends up being higher than gasoline. But for the new customers coming in, we’re being completely honest with them.” Protec is a member of the recently formed Coalition for E85, a group of retailers, producers, equipment manufacturers and fuel distributors focused on modifying the tax code to allow E85 to qualify for the 50-cent-per-gallon tax credit allotted to other recognized renewable fuels, such as propane, hydrogen and compressed natural gas. “We must not abandon E85 this close to self-sustainability,” Garner said in a statement announcing the group’s formation. “We hope retailers, producers, automakers and others concerned about the future of E85 will stand up and fight with us.” Garner admits, however, that given the dysfunctional state of politics it is unclear whether any progress can be made on this effort before 2012.
Despite pricing and incentive uncertainty, most of the retailers installing E85 pumps in recent months are confident that the fuel will continue to have a market, Garner says. Protec’s customers tend to be pro-alternative fuel and are eager to do something that will set them apart from their competition in order to drive customers into their stores. “Customers may have requested it or asked about, or the store owner wants to separate himself from the other stores in the area,” he says. “These are the same kind of people who are putting solar panels on their stations to reduce their energy costs. These are very pro-active people.” Protec’s business model offers turnkey ethanol-related services to its customers, from site selection and grant application assistance to fuel supply and marketing services. It was recently involved in the installation of Raleigh, N.C.’s first dual-fuel E85-B20 pump, located at a Crown Express Mart station. “We are excited to be able to offer alternative fueling options in the Raleigh area,” Kokila Amin, one of the station owners, said in a statement. “Individual and fleet customers now have a choice and convenient place to pump E85 and B20 fuel seven days a week.” —Kris Bevill
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‘Proven Products’ Technology and enzyme developer Codexis Inc. recently announced a rebranding of sorts as it moves out of the research and development (R&D) phase and into product sales. CEO Alan Shaw said during the company’s third-quarter earnings call in November that, while more than half of the company’s revenue is currently in the form of R&D funding, future revenues are expected to come from three sources—the sale of enzymes, the sale of products made using Codexis enzymes and microbes, and royalties from the use of Codexis technology. “Codexis transformed pharmaceutical manufacturing by driving the adoption of our biocatalysts solutions, which prior to Codexis were a promise that hadn’t become reality,” he says. “We now have more than 50 pharmaceutical companies using our enzymes for everything from early-stage compound development to production of the some of the world’s best-selling drugs. Our goal is to repeat that revolution in biofuels and biobased chemicals.” Codexis has developed a technology platform it calls CodeEvolver that combines DNA shuffling and proprietary bioinformatics to create new biocatalysts with characteristics that exceed the performance of those found in naturally occurring enzymes. The technology is expected to be put to use initially in Brazil by Raizen Energia S.A., Codexis’ largest shareholder, to improve sugarcane-based ethanol production.
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PHOTO: SHELL
Codexis moves from R&D to product sales
Cane Ethanol Fermented sugarcane juice flows through a series of distillation columns to produce ethanol at Raízen’s da Barra mill, in Brazil. Codexis aims to apply its biocatalyst technology to improve the process.
Raizen was formed earlier this year as a joint venture between Royal Dutch Shell plc and sugarcane and ethanol producer Cosan Ltd. The CodeEvolver platform is expected to be rolled out initially at one of Raizen’s 24 sugar mills. Shaw said work on the collaboration with Raizen is already under way. “Our collaboration with Raizen will focus on a range of targets including improving the performance of yeasts now used in ethanol production and may also include development of other products from sugar such as biobased chemicals,” he adds. Between the Raizen collaboration and the company’s partnership with Shell to produce next-generation biofuels from non-food biomass, biofuels will play an integral role in the company’s shift toward becoming a products company, according to Shaw. “Our goal is that our technology will become the industry standard for next-generation biofuels,” he says. —Kris Bevill
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Ethanol-Friendly Manitoba
Shell scouts commercial-scale cellulosic opportunities Royal Dutch Shell plc is in the early stages of a development project that would site a commercial-scale cellulosic ethanol plant in southern Manitoba. “It’s very, very, very early in the development,” says Jeff Gabert, senior communications representative for Shell Canada Ltd. The Solstice Cellulosic Ethanol project would use approximately 350 metric tons of (primarily wheat) straw per day to produce about 40 MMly (approximately 10 MMgy) of cellulosic ethanol using technology developed by Ottawa-based Iogen Corp. Shell has been an Iogen investor since 2002 and has contributed millions of dollars to the companies’ joint venture, Iogen Energy, to commercialize cellulosic ethanol technology. Iogen’s enzymatic hydrolysis approach has been used to produce cellulosic ethanol from various feedstocks at its demonstration-scale facility in Ottawa for six years, producing a cumulative total of more than 475,000 gallons of ethanol to date, according to the company. “Iogen has been very consistent in its technology,” Gabert says, adding that Shell has been blending Iogen’s ethanol into its gasoline for some time. “The technology has worked,” he says. “It’s time to scale up to a commercial plant.”
Shell’s first location choice for the Solstice project is Portage la Prairie, Manitoba, a city of about 12,000 people located about an hour’s drive west of Winnipeg, Manitoba’s capital and largest city. According to Gabert, Portage’s abundant supply of available feedstock and proximity to main roadways makes it an ideal location for the plant. In fact, some farmers in the area have already signed up to supply straw. “Everybody right now is getting excited, but we want to manage those expectations,” he says. The company has begun the process of completing an environmental assessment, but there’s “no ink wet” on the paperwork yet, so the process is far from being complete. An alternative site has been scouted closer to Winnipeg, but Gabert says Shell is very focused on Portage la Prairie currently. In general, Manitoba is appealing because it is encouraging of industrial growth and provides a good selection of skilled laborers, he says. Shell became actively involved in Brazilian ethanol production earlier this year, but the company is not ruling out expansions to other countries, including the U.S. “Depending on this project, there is always opportunity elsewhere,” Gabert says. “There is a lot to be said in how this project goes or doesn’t go.” —Kris Bevill
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Digesting Away An expansion completed last February at the Hairy Hills ethanol plant site added two anaerobic digesters. The original digesters, the two at the far right in the photo, have been operating for six years. PHOTO: HIMARK
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Good
Digestion It’s been a bumpy road to full-scale adoption of anaerobic digestion technologies at ethanol plants By Holly Jessen
Despite the promise of methane from anaerobic digestion technology, low natural gas rates and other factors have kept ethanol producers from jumping in with both feet. The race to be the first operational full-scale anaerobic digester co-located with an ethanol plant is being run between an existing ethanol plant in Kansas and an existing anaerobic digestor in Vegreville, Alberta. Western Plains Energy LLC, a 45 MMgy Oakely, Kan., ethanol plant, hopes to have a digester in operation by early next year. In Canada, ground was broken this fall for Growing Power Hairy Hill LP, a 40 MMly (approximately 10 MMgy) ethanol plant co-located with on-site digesters that have been in operation for about six years. Both facilities are utilizing Integrated bioRefinery technology, developed and trademarked by Himark, formerly Highmark Renewables. In September, Western Plains Energy received a $15.6 million grant from the Kansas Department of Commerce, which it will use to help complete the estimated $35 to $40 million project. The methane produced will be used to completely refire the plant’s thermal oxidizer and boiler. “If we can improve the recipe, we may eventually make our own electricity, but our plans aren’t to sell back on the grid,” says CEO Steve McNinch. On top of the digester, Western Plains Energy utilizes sorghum, or milo, as a feedstock in addition to corn. In October, the plant received $899,861 for production of ethanol from a renewable biomass, other than corn, through the USDA's Bioenergy Program for Advanced Biofuels program. By putting ethanol production from sorghum and power generation from an
january 2012 | Ethanol Producer Magazine | 35
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anaerobic digester together, the ethanol plant is hoping it will merit an advanced biofuel designation. “The digester gives us a chance to dramatically reduce our carbon footprint and hopefully qualify as an advanced biofuel for our ethanol at the end of the pathway analysis by the EPA,” McNinch says. When considering anaerobic digestion, Western Plains Energy looked at several different factors. Although natural gas prices are currently low, the company doesn’t believe that will last forever, McNinch says. The company also considered overall cost of the project. “Currently the cost of capital is also extremely low,” he says, “so if you are going to enter into a construction phase, when basically the cost of construction is almost zero, now would be the time to do it.” Plus, if Western Plains Energy is going to take advantage of the grant money it got from the state, the money has to be spent before the end of March. The money will come from unspent American Recovery and Reinvestment Act funds appropriated to the Kansas Corporation Commission’s Energy Division. The factor that really tipped the scale in favor of the project, however, was technology advancements, McNinch tells EPM. Himark’s Integrated bioMass Utilization System, also trademarked, is unique in that it can be operated continually without sand and grit building up in the digester over time. The system also introduces heat to the digester. “So we will get gas quicker and the quality of the gas will be higher,” he says. “It’s just a much nicer technology.” The main feedstock for the digester is manure from Pioneer Feeders, a 40,000-head feedlot about six miles from the ethanol plant. All the manure produced at the feedlot will be delivered to the ethanol plant by 25 trucks daily, McNinch says. The ethanol plant has an agreement with the feedlot to return all the organic fertilizer produced at the end of the digester process to the feedlot for the first year, followed by decreasing amounts after that. Eventually, the ethanol plant will market and sell the fertilizer itself. The fertilizer produced during the digestion process is weed, seed and pathogen free. Unlike fresh manure, which has to be composted to knock down ammonia levels, the highvalue fertilizer coming from a digester won’t cause water quality problems in runoff. It’s also
High Hopes Former CEO and majority owner Dennis Langley stands in front of an anaerobic digester constructed at the plant in Mead, Neb., built by the defunct E3 Biofuels.
highly concentrated. “For every five loads of manure that will go in the digesters, only one truckload of solids will come out,” he says. Although McNinch declined to name all the feedstocks for the digester, he did say it would also utilize the plant’s thin stillage. Western Plains Energy currently uses a portion of its thin stillage for backset at the front end of the plant. Once the digester is online that water stream will be replaced by the recycled water coming out of the back end of the digester. Himark was established as a research and development company 11 years ago by brothers Bern and Mike Kotelko, owners of an Alberta feedlot. The digesters were originally built to address problems with smell, overloading of soil in the vicinity of the feedlot and the threat of possible water table contamination, says Evan Chrapko, co-CEO of Himark with his brother Shane Chrapko. After an expansion was completed in February, the digesters began processing half the daily output of manure at the co-located 36,000-head feedlot. Other feedstocks are used as well. This fall, with financing in place, the company moved forward with the final phase of the project— expanding the capacity of the digesters to 200 MMgy and building the 40 MMly ethanol plant. The goal is to feed the wet distillers grains to the cattle and use the manure from the feedlot in the digester to power the ethanol plant. In addition to these two projects, Poet LLC, the largest U.S. ethanol producer, has a
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small-scale anaerobic digester in operation at its cellulosic ethanol pilot plant in Scotland, S.D., that converts corn cobs and light corn stover to ethanol. The company intends to locate a digester with its first commercial-scale cellulosic plant, Project Liberty, planned for Emmetsberg, Iowa. The feedstock for both digesters is lignin.
Digestion Disorder?
Unfortunately, there is more than one example of ethanol plants aiming for biogas production but missing the mark. United Ethanol LLC in Milton, Wis., had planned to install a digester to displace 25 percent of the plant’s natural gas use after it received a $2.25 million low-interest loan from Wisconsin’s Energy Program last October. But, construction never actually began. “Construction of the anaerobic digester project for United Ethanol LLC has been put on hold pending further improvements in the economic model and satisfaction of proposed project impacts to overall United Ethanol operations,” said Dori Lichty, communications, media, and public relations manager. California ethanol plant, Calgren Renewable Fuels LLC, struggled to get local approval for an anaerobic digester after objections by the ethanol plant’s neighbors about odor, impact to air and water quality and possible contamination by pathogens—things digesters actually improve or prevent. The project was put on hold in June, though by November it was tentatively moving forward again pending approval by the county planning commission. In response to those concerns, changes were made to the proposed project, including no trucking of manure, says Daryl Maas, project manager. Instead, it will all be delivered via a pipeline from a nearby dairy. In addition, a pasteurization step has been added at the back end of the digester. The 58 MMgy plant was awarded a $4.68 million matching grant from the California Energy Commission to build the $10 million project. There are two examples of project failures in 2007, though not because the digesters weren’t working. The Renova Energy Idaho LLC ethanol plant in Heyburn, Idaho, was never completed—also sidelining its digester, although that part of the project was 95 percent complete. The E3 Biofuels plant, now working toward restarting in 2012 as AltEn LLC, never reached its full potential before a boiler explo-
sion put the 23 MMgy ethanol plant down a path to bankruptcy. In this case, the digester technology was already in place and functioned above expected levels in testing. Convincing ethanol plants to move forward with anaerobic digestion is a slow and heartbreaking process, according to David Rein, a process engineer with Rein & Associates of Moorhead, Minn. Rein spoke on the topic at a conference put on by the Energy & Environmental Research Center in July at the University of North Dakota. The company has been conducting bench and pilot studies of
biogas production from thin stillage since 2006 and completed feasibility studies that resulted in three separate grant awards to ethanol plants, which ranged from $1.6 million to $3.2 million. All three grants were through the USDA Repowering Assistance Program, which offers biorefineries funding to use renewable biomass as a replacement fuel source for process heat or power. The funding, which would have provided for only a fraction of the full project cost, was ultimately turned down by all three ethanol plants, Rein said at the EERC conference.
january 2012 | Ethanol Producer Magazine | 37
PHOTO: NATURAL CHEM
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Down and Dirty Natural Chem Group LLC purchased the anaerobic digester on the site of a partially constructed ethanol plant in Idaho.
Feedstock Source
Co-locating digesters with ethanol plants for power generation isn’t the only model out there. Houston, Texas-based Natural Chem Group LLC wants to operate digesters utilizing syrup from ethanol production as well as other
feedstocks, says CEO Robert Salazar. Looking to the future, the company is working to build 10 digesters, including three adjacent to ethanol production facilities in the Texas Panhandle, California and Wisconsin. The goal is to provide biomethane power to California, or,
more likely, selling further purified compressed natural gas or liquid natural gas into the transportation fuels market. Natural Chem already owns the digester in Heyburn, located next to the failed Renova Energy Idaho LLC ethanol plant. The digester’s main feedstock will be syrup from nearby ethanol plants as well as milk, cheese and potato waste from area industries. The original plan was to produce raw biogas, which is 60 percent methane, but Natural Chem is working on the financing to expand the output and purify it to 99 percent methane, he says. Once completed, the digester will produce about 2 million Btu yearly of pipeline quality biomethane, which will likely be converted onsite to compressed natural gas and sold into the Idaho transportation fuels market. “We would expect that by the end of the first quarter of 2012 we will go ahead and complete the financing for the expansion and other improvements,” Salazar says. “We should be online within about 10 months.” Natural Chem also plans to develop about 20 compressed natural gas fueling stations in Idaho, Oregon and Washington and will supply the product to fleets and school districts. The company has been in existence since 1992 and spent a lot of time in research and development, working on creating new revenue streams from low value byproducts such as syrup and crude glycerin. Its mission is to work to create new applications for state-ofthe art, existing technologies. “There’s no rocket science in what Natural Chem does,” Salazar tells EPM, adding that the company does feel it fits the definition for being innovative. Natural Chem expects to have all the necessary agreements in place to buy its raw materials and sell compressed natural gas by the first quarter of the year. The company is using a project finance model having multiyear contracts in place before closing on any financing. “We’re just patiently, step by step, getting all the pieces in place,” he says. Author: Holly Jessen Associate Editor, Ethanol Producer Magazine (701) 738-4946 hjessen@bbiinternational.com
38 | Ethanol Producer Magazine | january 2012
SM
,[OHUVS 9LK\JLK .HZ 7YPJLZ I` WLY NHSSVU PU Ethanol reduced the average American household’s gasoline bill by more than $800. If ethanol disappeared, gas prices could rise by as much as 92%.*
>L JHU»[ HMMVYK [V WH` L]LU TVYL H[ [OL W\TW Over 200 plants nationwide. 13 billion gallons of clean, renewable American energy, a year. Fueling the economy with over 400,000 jobs. Turning everyday abundant, renewable ingredients into clean sustainable energy.
www.EthanolRFA.org *Hayes, Dermot J., Du, Xiaodong (April 2011) The Impact of Ethanol Production on US and Regional Gasoline Markets: An Update to May 2009. Center for Agricultural and Rural Development (CARD).
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Ships Passing in the Night A look back at a year of booming U.S.imports to Brazil and ahead to increased U.S.-Brazil ethanol exchanges By Holly Jessen
The past two years, Brazil has compensated for its tight supply of ethanol in a high demand domestic market by importing increasing amounts of corn ethanol from the U.S. and exporting less cane ethanol to the U.S. In the second half of the year, how-
ever, Brazil ethanol started entering the U.S in increasing volumes. “In the long-run, we expect Brazil to return to being a leading exporter of ethanol, but it’s too early to say when that might occur and how much they’ll export,” says Geoff Cooper, vice president of research and analysis for the Renewable Fuels Association. “While 2011 may prove to be the high water mark for U.S. ethanol exports, we believe exports will generally remain strong in 2012 and beyond.” In 2010, Brazil imported nearly 22 million gallons of U.S. ethanol. That was nothing compared to what happened in 2011, however. Looking at the latest figures available, showing movements through September, the country had already imported 202 million gallons of U.S. ethanol. In the meantime, Cooper
january 2012 | Ethanol Producer Magazine | 41
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SOURCE: RFA
LWC629-RJS-0446 Biorefining Ad #3 1/11/11 1:46 PM Page 1
says, Brazil exported virtually no ethanol to the U.S. in 2010 and through the first half of 2011. In July, shipments from Brazil began to pick up, adding up to about 26.5 million gallons of Brazilian ethanol brought in to the U.S. by the end of September. Compared to the amount of U.S. ethanol typically imported to Brazil, the numbers are significant, admits Adhemar Altieri, corporate communications director for UNICA, the Brazilian Sugarcane Industry Association. Brazil has imported U.S. ethanol in the past, however. After all, ethanol is an agricultural commodity subject to weather patterns. “You put it all together, you are talking about 3 percent of the market,” he tells EPM. “So we are not talking huge numbers—we’re talking larger numbers than usual—but we are not talking really, really, big significant numbers. This is not an indication that Brazil will be an importer country for the long run. At least that’s not the way we see it.” Although more U.S. ethanol is currently going to Brazil than the other way around, overall the country is still a net exporter, Altieri points out. Through October, Brazil
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may have imported 699.5 million liters (184.7 million gallons) but it exported a total of 1.1 billion liters. Brazil exported ethanol to several countries in 2011. The U.S. is on the top of the list, receiving 28 percent of exported Brazilian ethanol. Next, at 22 percent, are the Caribbean countries as a group. “Keep in mind that most of the ethanol headed for the Caribbean is probably being reprocessed and shipped to the U.S. to take advantage of their no-tariff status,” he adds. Looking ahead, the U.S. and Brazil are expected to continue to export ethanol to each other. That’s because there’s a demand for Brazilian sugarcane ethanol to fulfill the requirements of the renewable fuel standard (RFS), and, to a lesser extent, California’s Low Carbon Fuel Standard, says Cooper. On the other side of the coin, that will provide continued opportunity for U.S. producers. “It’s likely that Brazil will ‘back-fill’ those exported volumes with imports of lowerpriced U.S. corn ethanol to meet their own market needs—at least in the near-term,” he adds.
Altieri agreed with Cooper’s assessment that U.S. and Brazilian ethanol would be passing each other in ships and why. “It’s led to a situation where you have ethanol going in both directions,” he says, adding that the situation was expected. Notably, increasing numbers of Brazilian sugarcane mills are jumping through the hoops required by the U.S. EPA to export ethanol to the U.S. As of early October, UNICA reported that a total of 107 Brazilian sugarcane mills were registered with the U.S. EPA, more than double the amount that were registered in February. In addition, 44 Brazilian mills have registered to export ethanol to California. All in all, UNICA considers the back and forth trade between the U.S. and Brazil as a good thing. “We would like to see, obviously, a lot more countries involved in production and use of ethanol because that’s where we want to go, which is to make ethanol a full blown, globally traded commodity,” he says. And overseas markets, including Brazil, have provided a valuable market for U.S. ethanol producers. That’s especially true
with the country’s market for ethanol currently capped at 10 percent. On the other hand, it shows the need for the U.S. to expand the market for ethanol by moving to E15 and building out infrastructure for flexfuel pumps. “The goal of the renewable fuel standard is to reduce our dependence on foreign oil by producing domestically produced renewable fuels,” says Tom Buis, CEO of Growth Energy. But what does the situation mean environmentally? On a lifecycle basis, shipping U.S. ethanol to Brazil and Brazilian ethanol to the U.S. isn’t an issue of concern, according to Helena Chum, a research fellow at the National Renewable Energy Laboratory. Transportation by ship is not the most energy consuming or emissions-releasing portion of the process. It’s actually worse for the environment, she says, to transport biofuels via truck from the Midwest to California. Chum also views the development of a global marketplace for ethanol as a positive thing. Because biofuel production can be affected by factors such as weather, it’s good to
january 2012 | Ethanol Producer Magazine | 43
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1.2
billion liters
estimated total of ethanol Brazil expects to import by the end of 2011
1.65
billion liters
sugarcane ethanol exported from Brazil in 2010
6.62
percent
the expected decrease in exports from Brazil from 2010 to 2011
SOURCE: UNICA
see two large players exchanging commodities with one another. In addition, there are several examples of U.S. companies currently working on research in Brazil that can take what they learn and apply it in the U.S. “It’s a completely interconnected market,” she says.
Expansion Needed
In early November, UNICA, in partnership with the Center for Sugarcane Technology, released its revised total for the 2011’12 season, decreasing its predictions from the previous forecast. Overall, it’s expected that Brazil’s total sugarcane crush will yield 488.5 million tons, a decrease of more than 12 percent from the previous harvest of 556.95 million tons. “Major factors that explain the lower yields are the advanced age of the cane fields and unfavorable weather conditions for plant development, including prolonged droughts during the winter months that affected the last two harvests and the occurrence of frost and flowering at the beginning of the current harvest,” the group says. There is an overcapacity in the industry
but a lack of raw materials, says Antonio de Padua Rodrigues, UNICA’s technical director. The country needs to accelerate the renewal of aging sugarcane fields to increase ethanol and sugar production. "The variables mentioned, along with the expectation of only four new crushing mills launching next year, should result in a very slight increase in crop production for the 2012-’13 harvest," he says. Brazil’s sugarcane mills produce both sugar and ethanol, depending on market conditions. For the current harvest season, UNICA estimates ethanol will take up 51.81 percent of all harvested sugarcane, leaving 48.19 percent for sugar production. In all, the country is projected to produce 20.39 billion liters of ethanol, nearly 20 percent less than was produced in the previous harvest. “This year’s projected ethanol output will be lower than in the 2007-’08 harvest, a time when the fleet of flex-fuel vehicles amounted to less than half the current fleet,” Rodrigues says, adding that extreme price and consumption pattern changes haven’t as yet happened. Needed expansions in the Brazilian in-
TRADE
dustry won’t happen overnight, Altieri says. From financing to completed construction of a new sugarcane mill takes three years. That includes acquiring land for sugarcane production or making arrangements with sugarcane growers. “Brazil looks as though it is going to need some level of import for the next two or three years, until the industry gets on track here with expansion,” he says, adding that he can’t predict how much U.S. ethanol will be needed in Brazil.
Trade Issues
Ethanol tariffs are an issue the U.S. and Brazilian ethanol industries have not seen eye-to-eye on for a long time. Brazil announced in March 2010 it was temporarily eliminating its 20 percent ad valorem tariff on imported ethanol, saying it would remain at zero through the end of 2011. UNICA requested the elimination of the Brazilian tariff, Altieri says. Although the group is keeping a close watch on what will happen with the U.S. tariff, it’s not a determining factor on what Brazil will do with its tariff. “Our position is that it should remain zero,” he says. “We think countries like Brazil and the U.S. have to set the example.” The U.S. 54-cent tariff on ethanol is set to expire at the end of the year. In early December, however, a bill to extend the tariff through 2014 was introduced in the U.S.
House of Representatives. RFA doesn’t believe the U.S. tariff should be allowed to expire so it can be used as a bargaining chip at the negotiation table to discuss any trade barriers on both sides. “What we are concerned with is, if it is allowed to just simply expire, USTR will not be able to use that to address recent trade distortions that have occurred,” says Edward Hubbard Jr., legislative counsel for the RFA. “To unilaterally disarm at this time, by walking away from a WTO compliant secondary tariff, would be a mistake.” In addition, the association is concerned that the Brazilian tariff could be reinstated immediately if the U.S. tariff is allowed to expire, Hubbard says. “Brazil has made a lot of hay about suspending that tariff but what’s not been articulated very clearly to the public is that that temporary suspension is scheduled to expire at the end of the year,” he says. That’s simply not the case, Altieri says. Brazil has a list of items on a zero tariff list that is revised every six months and the tariff on ethanol has remained untouched. “There’s been three or four chances already to reinstate that tariff and it has not happened,” he says. “There is no timetable for it to come back.” What are the trade distortions RFA is concerned about? Hubbard points to Brazil’s actions in lowering the 25 percent blend re-
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quirement for ethanol to 20 percent, 2 percent shy of the legal minimum of 18 percent. In late October, RFA sent a letter to Ron Kirk, an ambassador with the office of the U.S. Trade Representative, outlining its concerns on the issue. “We really don’t see any justification for reducing the blend volume other than to close the market for U.S. exports, so we have identified that as a significant trade distortion, a very recent trade distortion, on the part of Brazilian government,” Hubbard tells EPM. Again, UNICA and RFA are not on the same page. “I can’t see how they would get to that,” he says. “They have never sold as much ethanol as they have now to Brazil— there is nothing concrete that could possibly support a statement like that.” Brazil has been blending 25 percent ethanol in its gasoline since the 1970s. The trend is that the blend level will revert to that 25 percent maximum level. “That’s what the country has been doing for decades,” he says, adding that the decision will be made based on what happens in the next harvest season and how quickly the Brazilian industry can expand. Author: Holly Jessen Associate Editor, Ethanol Producer Magazine (701) 738-4946 hjessen@bbiinternational.com
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january 2012 | Ethanol Producer Magazine | 45
e15
If introducing E15 to the marketplace were a mountain climb, receiving the fuel waiver from the U.S. EPA would be the equivalent of reaching the summit of K2, the second highest mountain in the world. The climb was steep and wrought with challenges, but with perseverance and the right tools, the peak was reachable. The move to E15 was initiated by Growth Energy, which filed the waiver petition with the EPA in March 2009. The industry believed it had the scientific backing to support the use of higher ethanol blends in all vehicles and said allowing higher blends into the market would create jobs, lessen dependence on foreign oil and improve the environment through reduced greenhouse gas emissions. The EPA proceeded to require thorough testing of the fuel through the U.S. DOE and after nearly two years of testing and analysis, the agency agreed that E15 would be an acceptable fuel for vehicle model years 2001 and newer. Many thought the fuel waiver approval represented the end of a long battle to introduce higher ethanol blends to consumers and 46 | Ethanol Producer Magazine | january 2012
hailed the approval as a victory for the ethanol industry. It was clearly a victory, but looming in the distance was the even greater challenge of clearing the regulatory hurdles necessary to bring the fuel to market. EPA Assistant Administrator Gina McCarthy warned of these challenges after issuing the initial partial approval for vehicle model years 2007 and newer in October 2010. “This decision was a step in the direction of allowing more renewable fuels into the market,” she said. “It is by no means an assurance that that will happen quickly and that is by no means the EPA’s job.” As the past year has shown, for industry representatives working on the task, bringing E15 to the market represents the regulatory effort of scaling Mount Everest. There may never be another climb this high again, because once E15 clears the regulatory hurdles the basis will be set for higher blends in the future. But in order to lay that initial groundwork for E15, the industry must meet or beat a host of requirements and, in some cases, essentially rewrite fuel regulations. Industry experts anticipated some of these issues and began preparing for them before the EPA issued the first of its two-part partial waiver
e15
Reaching the
Summit Getting the waiver was easy, compared to the work required to fulfill requirements for E15 implementation By Kris Bevill
approval over a year ago in October. Proposed policy changes, certification reversals and other issues have proven to be the equivalent of formidable mountain weather, forcing unanticipated detours and delays in the climb toward E15 implementation. The challenges are many, but they are not insurmountable. Those working to overcome them say they can see the summit through the clouds and believe they might reach the E15 summit by mid-2012. Petroleum and its history of destruction can be blamed for current regulations. Because petroleum has such devastating impacts on the environment when it is spilled or otherwise released, increasingly strict regulations have been put in place over time in attempts to counter its negative effects. And because petroleum has been the only fuel consumed in the U.S., regulations for more environmentally friendly fuels do not exist. There are no exceptions. â&#x20AC;&#x153;The regulations are already written so you have to try to shoehorn a biofuel into a petroleum-type of equation,â&#x20AC;? says Kristy Moore, vice president of technical services at the Renewable Fuels Association. Moore and other industry representatives have been working on
regulatory issues regarding E15 for more than a year. Their to-do list is long and complicated. Included on that list: completing fuel registration with the EPA, acquiring an extension of a waiver for Reid Vapor Pressure regulations, ensuring that dispensing and storage equipment complies with fire code specifications, and addressing possible concerns related to automaker warranties. Some of these items have been easier to complete than others.
Registration
The Clean Air Act requires all fuel manufacturers and fuel additive manufacturers to register their products with the EPA administrator before making them commercially available. E15 falls under the fuel additive category, which requires manufacturers to supply the EPA with information related to the chemical composition of the additive or to disclose the chemical process of manufacture. The manufacturer is also required to supply the description of an analytical technique that can be used to detect the presence of the additive in fuel and must submit all test data and other information required january 2012 | Ethanol Producer Magazine | 47
e15
prior to the registration process. The EPA also requires all detergents used in gasoline to be certified. The certification process has been completed and the fuel registration process is expected to be complete by the end of this year, according to Moore.
Equipment Compliance
Local fire marshals and weights and measures divisions have the responsibility of certifying that fuel storage and dispensing equipment is compatible with targeted fuel blends, but approval of the equipment by Underwriters Laboratories Inc., a nonprofit product safety organization, can be used by those authorities to easily certify the equipment. In 2009, UL approved the use of fuel blended with up to 15 percent ethanol in legacy equipment, but stated that because E15 can contain a concentration of ethanol higher than 15 percent, more testing would be required before it could approve E15 for use in storage and dispensing equipment. Later, UL indicated that it would provide a favorable guidance for E15 in legacy equipment, but rescinded that favorable decision in late 2010 after U.S. DOE-funded testing indicated potential issues with sealing materials on fuel dispensers containing 17 percent ethanol. Fortunately, the remedy was determined to be low in cost. Retrofit kits worth about $500 could take care of the issue, ac-
cording to the DOE’s National Renewable Energy Laboratory, and make it possible for the equipment to pass UL certification for blends up to E25. Fuel pump manufacturers and the ethanol industry were caught off-guard by the UL’s reversal on E15 equipment compliance. The ethanol industry considers UL’s decision to be subjective and points to E85 as an example of UL’s sometimes unsubstantiated decisions. “In 16 years of E85, there has been no leak or failure as a result of E85 being in that equipment,” said one industry representative. Despite that history, UL set certain specifications for E85 equipment, which ethanol representatives say slowed retailers’ implementation of the fuel. In the case of E15, fuel dispenser manufacturers have decided to warranty their products for E15 despite UL’s guidance, but the UL’s decision still makes it difficult for local officials to certify the equipment. “It’s not a problem that we can’t overcome, but it’s an additional layer that adds time and obviously slows down the number of folks who might have additionally jumped at the opportunity for E15,” Robert White, director of market development for the RFA.
RVP
The most complicated technical aspect of E15 implementation is the issue surround-
ing Reid vapor pressure (RVP) requirements. RVP is a common measure for gasoline volatility, which defines a fuel’s evaporation characteristics. The EPA regulates the RVP of gasoline in summer months to reduce the evaporative emissions, which are known to contribute to ground-level ozone. The EPA currently allows fuel blends containing 9 to 10 percent ethanol to exceed the 9.0 psi RVP by 1 pound from June 1 to Sept. 15. However, the agency decided not to grant the same waiver for E15, which means refineries will not be able to use the same gasoline blendstock for E15 in some parts of the country. This creates major issues for both refiners and the ethanol industry. Refineries would need to install separate tanks for storing E10 and E15 blendstocks during the summer months, which would reduce the potential for refineries to use both blends. Essentially, this could mean that E15 production would be virtually nonexistent for half of the year. Petroleum and ethanol industry groups vehemently opposed the EPA’s decision regarding RVP requirements for E15, citing evidence that suggests vapor pressure in ethanol blends tops out at 10 percent ethanol volume. In a comment filed with the EPA prior to its final rule, Growth Energy stated that imposing restrictive requirements on E15 is technically and legally unsupportive and would create unnecessary challenges for those introducing
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e15
E15 to the marketplace. “It does not make sense for Congress to allow a 1.0 psi waiver for E10 but not E15,” the National Petrochemical and Refiners Association said in a comment filed with the EPA. “This would be very disruptive and would have the practical impact of further balkanizing gasoline markets by creating a new boutique fuel.” The EPA refused to relent despite the evidence submitted by refiners and ethanol groups, however, and said its partial approval of E15 was based on the condition that the fuel not exceed 9.0 psi RVP in the summer months. The agency further indicated that it may consider repealing its RVP waiver for E10 in future rulemakings. Repealing that waiver would solve the issue of separate blendstock requirements for refiners, however, if the EPA were to propose that elimination now, it would be several years before the change could be implemented. Therefore, efforts are ongoing to evaluate whether there are specific blendstocks that can be used to produce E15 in those summer months.
Vehicle Warranties
Auto groups and retail gasoline station groups have repeatedly expressed concern over the lack of mention of E15 in vehicle warranties and said that because of this, consumers would be liable for any potential damage to their vehicle if they use E15.
Vehicle manufacturers’ voiced the same concern when E10 was introduced into the market and, while “gasohol” was blamed for some engine problems in the late 1970s to early 1980s, there are no reported cases of litigation during which warranty claims were denied as a result of E10 usage. James Pray, chair of the environmental law practice group at Brown Winick, says that this history provides some support for E15 use because the rate of increase in ethanol content is not that great. In the event of a warranty issue, the responsibility falls to the warranty issuer to prove that ethanol, specifically E15, was the cause of the problem. Pray says that in order for a car dealer to use E15 as a reason to deny a warranty claim, an expert must be able to testify “to a reasonable degree of scientific certainty” that there is no other plausible cause. The expert must also be able to explain how the additional 5 percent of ethanol caused the problem. Additionally, the manufacturer would then have to admit it used parts in the production of the vehicle that are not ethanol compatible, even though ethanol has been widely used as a fuel additive for three decades, he says. Some industry groups maintain the threat of class action lawsuits in the case of widespread misfueling or warranty issues, but Pray says the likelihood of a class action suit
is small. “Class action lawsuits are expensive to prosecute and generally seek targets of opportunity where the potential recovery is high, the cost of defending the case is prohibitive for the defendant and the risk of losing is low,” he says. “Given the track record in these cases, it is highly unlikely that class action law firms will sense much opportunity to file lawsuits challenging the use of E15.”
State-Specific Fuel Specs
Each state has the authority to set its own fuel specifications. Many states adopt guidelines set in the National Institute of Standards and Technology handbook for engine fuel quality, which restricts the ethanol content of gasoline to 10 percent in all vehicles. The RFA has submitted a request to eliminate that wording, but other issues related to fuel specifications also need to be resolved. States also require a fuel’s octane to be certified and existing standards do not address octane levels for fuels containing more than 10 percent ethanol. Research is being conducted to explore the octane levels of higher ethanol blends. Some industry members believe that the higher octane level of ethanol could be utilized to improve vehicle performance, but details from an ASTM investigation as well as other independent testing was not publicly available by late November.
january 2012 | Ethanol Producer Magazine | 49
e15
Consumer and Retailer Confidence
While all of the regulatory work is being done to make E15 ready for legal sale, a simultaneous effort is being made by industry members to ensure that consumers will be friendly to the fuel once it hits the market. Anti-ethanol groups have been quick to spread unsubstantiated information related to the use of E15, suggesting that it will ruin engines, increase emissions, and, in the case of small engines such as chainsaws, could even cause bodily harm to the user. Despite the immediate negative messaging from deep-pocketed groups, White says consumers aren’t likely to pay much attention until the fuel becomes available. By then, the ethanol industry hopes to have an extensive outreach program in place to educate consumers on proper use and benefits of E15. The RFA and other ethanol stakeholders as well as other industry groups, including the small engine manufacturers, have agreed to participate in an education outreach coalition which will address consumer concerns and requirements. As part of this, the RFA is launching a website—www.e15.org—devoted to providing consumers with relevant information. Interestingly, the sunset of ethanol subsidies at the end of 2011 could also help the E15 education efforts. The tax credit programs have been used by anti-ethanol groups as a means to support blaming ethanol for higher food prices in the past. Beginning in 2012, they won’t have that option. “It will provide a fresh start because having no subsidies removes the possibility to blame ethanol for those things,” White says. Efforts are also being undertaken to educate retailers on the benefits of providing E15 to their customers. The Blend Your Own Ethanol campaign is periodically hosting webinars to discuss retailers’ concerns and provide them with information regarding equipment and funding for upgrades. As White points out, blender pumps provide a way for retailers to offer E15 without having to carry out expensive infrastructure overhauls. “All you need is a $20,000 blender pump, not a six figure upgrade,” he says.
Rolling it Out
As the storm of regulatory hurdles begins to subside, the actual introduction of E15 is likely to be a gradual one, beginning with ethanol-friendly Midwest states such as Iowa, Minnesota and Illinois. The ethanol industry is working directly with various stakeholders in those states, including corn growers’ groups and petroleum marketers associations, to implement the new fuel in a fashion that is acceptable to consumers and leaves no room for misinterpretation. One of the things the industry learned through the implementation of E10 that they don’t wish to repeat is leaving the opportunity for pushback and negativity from anti-ethanol groups, Moore says. She and others believe they have made progress in this area and have worked hard to include all stakeholders in the process. Looking ahead to the implementation of even higher blends, which will be necessary in order to meet the increasing volume requirements of the renewable fuel standard, the regulatory efforts undertaken to introduce E15 will provide a solid basis to make the next step up a little easier. “We’ve taken good notes and we know what to do now,” Moore says, adding that the experience of increasing the nation’s fuel blend is only starting to become a clear reality to her. “We’ve been working on this issue for about 18 months now and I’m actually now starting to get nervous because I can see it. We’re going to cross through a couple of big barriers soon and retailers will be able to start offering E15. It’s game time.”
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Author: Kris Bevill Associate Editor, Ethanol Producer Magazine (701) 540-6846 kbevill@bbiinternational.com
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EPM MARKETPLACE
Engineering
Corn Oil Recovery
Biomass Energy
ICM, Inc. 877-456-8588
Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com
Design/Build Burns & McDonnell 816-333-9400
www.burnsmcd.com
ICM, Inc. 877-456-8588 PreProcess, Inc. 949-201-6041
www.icminc.com
www.preprocessinc.com
www.icminc.com
ICM, Inc. 877-456-8588
DDGS Diesel
Molecular Sieves
Total-Yield Diesel from Distillers 402-640-8925 www.total-yield.com
ICM, Inc. 877-456-8588
Dryers-Rotary Drum
Parts & Services
ICM, Inc. 877-456-8588
Process Design
Maintenance Software
www.icminc.com
ICM, Inc. 877-456-8588
ICM, Inc. 877-456-8588
Pipe
www.icminc.com
www.icminc.com
www.icminc.com
Determan Fluid Solutions 763-571-8110 www.determan.com
Dryers-Rotary Steam Tube
www.icminc.com
Process Design–Cellulose
Elevator Buckets
Robert-James Sales, Inc. 800-666-0088
SEKAB 952-926-0100
Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com
Pipe-Fittings
Equipment & Services
Emissions Testing & Reduction
Robert-James Sales, Inc. 800-666-0088
Air Pollution/Odor Control
ARI Environmental, Inc. 847-487-1580
www.sekab.com
Anguil Environmental Systems, Inc. 414-365-6400 www.anguil.com
ICM, Inc. 877-456-8588
Fermentation Monitoring ETS Laboratories 707-963-4806
Control Systems
www.icminc.com
www.arienv.com
www.etslabs.com
Fermentors
Kahler Automation Corp. 507-235-6648 www.kahlerautomation.com
Bioengineering, Inc. 781-672-2620 www.bioengineering-inc.com
Conveyors-Belt
Fractionation-Corn
Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com
ICM, Inc. 877-456-8588
Conveyors–Enclosed
Hoppers
Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com
Airoflex Equipment 563-264-8066 www.airoflexequipment.com
Conveyors–Mechanical
Loading Equipment-Liquid
Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com
Determan Fluid Solutions 763-571-8110 www.determan.com
Conveyors–Screw
PFT-Alexander, Inc. 1-800-696-1331
Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com
Maintenance Services
www.icminc.com
www.rjsales.com
Pipe-Flanges Robert-James Sales, Inc. 800-666-0088
www.rjsales.com
Productivity Enhancements ICM, Inc. 877-456-8588
www.icminc.com
Safety ERI Solutions, Inc. 316-927-4294
www.rjsales.com
erisolutions.com
Storage-DDGS Hoffmann, Inc. 563-263-4733
www.hoffmanninc.com
Tanks
www.pft-alexander.com
Determan Fluid Solutions 763-571-8110 www.determan.com
january 2012 | Ethanol Producer Magazine | 53
EPM MARKETPLACE
Ethanol Production
Thermal Oxidizers
Existing Producers Louis Dreyfus Commodities 402-844-2680 www.LDCommodities.com
Finance Insurance • 60 Years of Experience • 500+ RTO Installed Base • 100% Uptime Guarantee • 24/7/365 Emergency Response Service Guarantee
Clean Air & Energy Technology www.eisenmann.us.com Email: es.info@eisenmann.com
Truck Receiving/Dumpers
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Airoflex Equipment 563-264-8066 www.airoflexequipment.com
Valves Best Supply Company 316-262-8336 www.bestsupplycompany.net Cashco, Inc. 785-472-4461
www.cashco.com
Wastewater Treatment Services ICM, Inc. 877-456-8588
www.icminc.com
Yield Enhancement EdeniQ, Inc. 559-302-1780
www.edeniq.com
54 | Ethanol Producer Magazine | january 2012
ERI Solutions, Inc. 316-927-4294
erisolutions.com