Archive for October, 2010

Green and great for the fuel tank: NASCAR switches to E15

Written by Jonathan Eisenthal

National Association for Stock Car Auto Racing (NASCAR) will use E15 fuel in its three racing tours in 2011, the organization announced October 16. E15 is a new fuel blend that has just won approval from the Environmental Protection Agency for use in all light duty gasoline engine cars manufactured in 2007 or later. Ethanol advocates expect EPA to approve E15 for all vehicles produced after 2000–a November announcement is anticipated.

The blend is 15 percent ethanol and 85 percent gasoline transportation fuel.

“Indy Racing has been using 100 percent ethanol for several years and now NASCAR joins the renewable energy revolution with the blend that is soon to be approved for the majority of American cars–once again proving that higher ethanol blends are not only good for cleaner air and energy independence, but these are also high performance fuels,” said Greg Schwarz, a farmer in Le Sueur, Minnesota and president of Minnesota Corn Growers Association.

E15 may be the most tested vehicle fuel in the history of transportation. Among the many venues that have put E15 to the test, Minnesota Center for Automotive Research (MnCAR) has taken part in rigorous testing of both E15 and E20 on a variety of conventional engine gasoline cars and small engines. MnCAR’s testing has found no performance or emissions problems in either blend level. This research will provide the foundation for Minnesota’s move to E20 statewide, in most gasoline, in 2013. It’s usability in small engines will be a reassuring for many operators, especially farmers, who utilize a whole range of small engines connected to food and livestock production.

NASCAR has developed a partnership with Sunoco, which will produce the E15 at a Pennsylvania facility and provide it to all NASCAR teams free of charge, as it does with the racing league’s fuel needs currently.

NASCAR began what it calls its Green Innovation program in 2008 Up to now the program has promoted recycling and has funded tree plantings, but this is the first step that actually has to do with the operation of its racing vehicles.

“With Sunoco Green E15, we are leading by example, showing that this renewable fuel — which reduces greenhouse gas emissions — works in the most demanding racing environment in the world,” said Dr. Mike Lynch, managing director for Green Innovation for NASCAR. “NASCAR and Sunoco look forward to highlighting the efforts of the whole racing community to transition to Sunoco Green E15 in time for the Daytona 500 — from its manufacture all the way to the race track.”

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Ethanol industry sees red over E15 warning label

BY PHILIP BRASHER & DAN PILLER

The bright orange warning label that the government is proposing for E15 pumps has angered some in the ethanol industry.

Monte Shaw, executive director of the Iowa Renewable Fuels Association, says the label is going to scare motorists from putting the fuel even in cars where it’s permitted.

“I don’t think anyone with a straight face would say this label would do anything except reduce the amount of E15 sold, even in applications where it’s allowed,” he said.

The Environmental Protection Agency announced two weeks ago that it was allowing the use of gasoline containing up to 15 percent ethanol in 2007 and newer cars and trucks. At the same time, the EPA proposed regulations, including the warning label, to ensure that the fuel isn’t put in other vehicles.

Shaw questions the label’s truthfulness because of the sentence that says the “fuel might damage other vehicles.” The government is still studying the impact on models from 2001 to 2006 and isn’t doing any research on vehicles older than 2001, so there’s no basis to say that E15 might damage cars older than 2007 models, Shaw said. “That is a flat-out unsupportable statement that is very prejudicial,” he said.

The ethanol content of gas used in conventional cars and trucks has been restricted to 10 percent until now.

Read the full article:
http://www.desmoinesregister.com/article/20101024/BUSINESS01/10240336/-1/BUSINESS04/Ethanol-industry-sees-red-over-E15-warning-label

Our Take:
The EPA’s thinly veiled animosity towards ethanol jumps out into plain view here.

Clearly, the whole idea of marketing E15 to only one segment of the conventional gasoline-engine motoring public is misguided at best. That EPA proposes it shows that either they have no idea how the retail marketing of fuel actually happens or they are just plain trying to throw a wrench in the works.

There is no scientific basis for distinguishing 2007 model cars from 2006-model cars or earlier, just as there was no scientific basis for setting the ethanol blend level at ten percent in the first place.

They are playing to the prejudices of people who have been misinformed and have decided that ethanol will harm their engines despite a complete lack of proof for this misnomer.

We need real leadership to step in and get E15 allowed in fueling sites for all vehicles operated on American roads. If Brazil can make E24 its regular unleaded gasoline, then America can kick it up to E15.

New whey-based ethanol plant to rise soon

OWEN, Wisconsin — Ground will be broken this month for two major agriculture projects in Clark County.

A ceremony was planned Monday afternoon to start the first building at the new Central Wisconsin Agri-Business Innovation Center in Owen. Next week, another ground-breaking will mark the start of construction for Dubay Bio-fuels – a facility that will use a cheese by-product called “whey permeate” to make ethanol.

The initial building at the Agri-Business Innovation center will have space for a business incubator, classrooms, meetings, labs, and offices.

It will be located on Highway 29, next to land that’s been proposed as a permanent site for Wisconsin Farm Technology Days if the show ever wants to end its traveling status.

State Commerce Secretary Aaron Olver will attend the ground-breaking for the Greenwood bio-fuels plant, along with Caseus Energy C-E-O Alex Reyter.

Source: www.rivertowns.net

Our Take:
Look who else is profiting from the rise of the ethanol industry. If America puts some more muscle behind renewable transportation fuels–approving E15 for all light-duty gasoline engine vehicles, putting ethanol pumps in every gas station (ethanol has to be as user-friendly as gasoline if it is going to compete), and requiring flexible fuel equipment standard in all light duty vehicles–then there is no doubt that many industries with a biomass-based waste stream will be able to invest in facilities to turn that waste into energy. That goes for municipalities too–think of every city’s compost facility as feedstock for ethanol production. It’s time for America to get really serious about getting off of oil. It’s not that difficult to see how it could be done.

What’s wrong with cutting the ethanol producer payment?

It shows MN to be an unworthy partner for business–the wrong move when we need job growth

(from a 2003 article by Jack M. Geller, then president of the Center for Rural Policy and Development in St. Peter, Minnesota)

In addition to a favorable tax rate and a nurturing environment, I believe that what businesses should minimally expect from government is stability and predictability.  Even in a high-tax state, businesses can and do thrive if government taxes, regulations and business programs are stable.  This allows businesses to accurately predict what’s coming and build it into their operational models….In 1986, in an effort to launch an ethanol industry in Minnesota, the legislature agreed to assist these start-up energy companies with a 20-cent per gallon production payment, for 10 years.  Like any business, these production payments were figured into their financing plans as these entrepreneurs sought both equity investors and debt capital from local and regional banks.  Needless to say it worked; and as the Governor noted in announcing his decision to modify these payments, today most of these plants are profitable and are no longer as dependent on these subsidies.  But is that really the salient point? 

I’m glad that many of Minnesota’s ethanol plants are profitable; it’s great for our farmers, the rural economy and our environment.  But I am deeply concerned that in the short-term effort to reduce the state’s deficit, we just took a step backwards in our long-term efforts to be more business-friendly. After all, isn’t the message that we are really sending prospective businesses is that the State has become a less reliable business partner?  That in fact, as experienced by ethanol producers, maybe you really can’t take the word of the State to the bank? 

There’s little doubt that for better or worse, economic development today is often played out as a public- private partnership.  Don’t you think that the decision to site the new Best Buy corporate headquarters in Richfield had a little more to do with government incentives than its easy access to I-494? 

Our Take:
How important are promises made by the state? As Geller points out, where a state’s word is its bond, business finds partnership with the state to be a favorable situation. Geller notes that we can thank business-government partnership for items like the location of the corporate headquarters of the world’s largest electronics retailer here in Minnesota. And we can thank the visionary legislation that created the ethanol producer payment program with creating an industry that has brought thousands of jobs to Minnesota.

Not many days are left before the election, and predictably, some governor candidates have brought up the idea of cutting the producer payment program for small locally- and farmer-owned ethanol plants.

We don’t think the state needs a governor who will make promises and then pull the rug out. Since small business is the unparalleled generator of jobs, we need a governor who will stand by government’s investment in entrepreneurial business. We’d like to see a candidate actually recognize the contribution of ethanol production to the economy of Minnesota and promise, rather than cutting the incentive program, to keep it in place and, as Rep. Al Juhnke, (chair, MN House Ag committee) has suggested, once the current promises have been fulfilled, to move these payments over into a program to promote next generation farm-based fuels. A modest investment would potentially create thousands of jobs in a state that finds itself in dire need of them.

MN ag chief expects little from ethanol decision

(reported by BusinessWeek)

Minnesota Agriculture Commissioner Gene Hugoson doesn’t expect much immediate benefit for the state from the federal government’s decision to allow higher ethanol fuel blends for newer vehicles.

Hugoson calls last Wednesday’s decision to allow up to 15 percent ethanol for cars and small trucks made since 2007 “a step in the right direction.”

But he’s concerned the split decision and warning labels at the pumps against putting the fuel in older vehicles could confuse consumers by giving them a false impression there’s something wrong with ethanol.

And he doubts many retailers will install new pumps to handle E15 because only 15 to 20 percent of Minnesota cars will be new enough to use it.

Minnesota is one of the top ethanol producers in the country. The state mandates that all gasoline contain 10 percent ethanol.

Find article at:
http://www.businessweek.com/ap/financialnews/D9IR2BQG0.htm

Our Take:
Here again EPA continues its history of arbitrary decisions that lack scientific foundation, and they do so to the detriment of America’s energy goals. Just as the decision to limit ethanol as a gasoline additive to ten percent of the volume of regular gasoline had no scientific basis, the line drawn by the EPA at 2007 vehicle models has no basis. There is no significant change in fuel system equipment between 2006 and 2007. The upgrades to materials in the fuel lines that allow safe blending upwards of 20 percent occurred years ago.

These arbitrary cutoffs will serve no purpose, and only create confusion for the consumer.

We know that EPA will soon approve E15 for vehicles 2001 and later, but even that is not good enough. Even this decision to set the earliest boundary for E15 use at 2001 vehicle models has nothing to do with actual vehicle performance–instead, as an EPA official said to us off the record, it has to do with the difficulty of finding model year 2000 and earlier light duty vehicles with low or no mileage and in good running order, so that they may be subjected to the testing regimen that EPA has developed for E15.

We are quite certain EPA will be unable to justify not approving E15 for older vehicles, because tens of thousands of legacy conventional-engine vehicles run on E24 in Brazil–the blend considered regular unleaded gasoline in that country for most of this decade).

We hope elected officials and the general public can bring enough pressure to bear on the EPA bureaucracy to remove this arbitrary limitation to vehicles built in 2001 and after. Do we really need the confusion these arbitrary cutoffs create, just because there isn’t a museum filled with mint Ford Pintos and AMC Gremlins, with no miles and in perfect working order?

It’s time for EPA to stop working for the oil companies and the OPEC regimes and start working for the American public and its right to energy independence.
Brazil did it. So can we.

Ethanol welcomes regulation: God knows we wouldn’t want to be Big Oil

While we believe the fines for permit violations assessed at five plants in Minnesota this year are excessive and punitive, still the industry is better for having a process of collaboration with government in which the ethanol industry is called upon to have the least environmental impact it can have.

However, we find the Star Tribune’s analysis of ethanol’s environmental impact to be naive in the extreme. Today’s article holds an unstated premise that there exists some form of energy that we could create for our society that doesn’t have some environmental impact.

De facto, to limit or dismantle ethanol industry growth is to support oil. These are the only two alternatives for the majority of transportation vehicles, and for the technology we currently possess. Yes, there is a growing fleet of hybrid vehicles, but that only means that less gasoline is consumed per vehicle mile. Gasoline is still consumed. And plug-in hybrids, when they come, will simply allow users not to think about the environmental impact of how the necessary electricity is generated.

Partisans like Jeff Broberg complain about the use of water by the ethanol industry. We would like to point out that Koch Industries, with its Flint Hills Resources refinery in Rosemount, has a permit to use two billion gallons of water per year. One wonders if one allowed Koch to grow by the amount that Broberg would like to limit or reduce the ethanol industry, how that would affect the trout streams of southeastern Minnesota?

The point is, the ability of the world to support its growing human population, and to give humanity the hope that a growing portion of them can live beyond mere subsistence depends on growing our system of low-cost energy. Unless you want to play a game of 52-pick up with the world economy, you can’t choose not to develop some form of transportation energy.

A reason to celebrate the interplay between Minnesota regulators and our ethanol industry is that God knows we would not want to be Big Oil.

For most of its first century, the oil industry added lead to gasoline to reduce knocking, knowing full well it was a poison. Leaded gasoline caused untold misery by poisoning literally millions of people in America and around the world. Lead only disappeared from gasoline, thanks to government regulation, in the 1990s.

But who gives oil a clean bill of health now? The aromatics in gasoline that help it perform well are a laundry list of proven carcinogens. When the oil industry tried to offer its own oxygenate additive, MTBE–a fractionate from oil and natural gas wellheads, many communities discovered only too late that MTBE cannot be contained by underground storage tanks and quickly leaks into groundwater.

In 2000, EPA fined Koch Industries $30 million for 300 oil spills in six states (http://yosemite.epa.gov/opa/admpress.nsf/d0cf6618525a9efb85257359003fb69d/981d17e5ab07246f8525686500621079!OpenDocument).

Of course, regulatory attention can lead to improvements. In 2008, Koch’s Flint Hills Resources was one of 170 entities to win Minnesota Pollution Control Agency’s wastewater operator of the year award for its implementation of wastewater recycling. Poet Biorefining, a Minnesota ethanol plant, also won the wastewater operator award in 2008. The point is it is possible for industry to improve its environmental impact.

What if PCA had been in charge of regulating blow-out preventers–you know, the valve that was supposed to prevent oil from leaking from an offshore oil well? Perhaps hundreds of millions of gallons of oil would not have poured into the Gulf of Mexico. We’re glad that PCA is helping correct the ethanol industry when it accidentally dumps water meant for golf course irrigation, or burns pre-treated wood in its fluid bed reactor (which, by the way, reduces carbon emissions by using renewable biomass instead of natural gas).

Finally, people who campaign against ethanol have a right to know what they are really signing up for. Here is a report from 2008, from the Kiplinger Letter (a leading source for business news) about the future of domestic oil development in the United States.

“The U.S. is sitting on the world’s largest, untapped oil reserves (2.3 trillion barrels),” writes Jeff Ostroff. “What’s the problem then? Why aren’t oil companies jumping to pump the black gold? Contrary to what some conspiracy theorists would have you believe, there is no cabal of oil companies and foreign governments blocking the way, bottling up U.S. oil production. The reality is much more mundane. Those untapped reserves are located in places that either Uncle Sam has put off-limits for environmental reasons or are too costly to get — or a combination of both.”

Ostroff reviews the shortlist of untapped reserves, without a scintilla of concern about the environmental degradation they will involve. He notes that the vast oil shale reserves that sit under Colorado and Wyoming are atop “pristine” federal nature reserves, and that processing these rocks for the oil they contain involves “cooking or chemical treatment.” Typically, this means Thermally Enhanced Oil Recovery, among other techniques, which requires a tremendous amount of energy (read far more ‘carbon intense’ than ordinary oil recovery), and which requires the use of water resources, which needless to say are not the same after they have been used to process petroleum.

We will include only the Bakken Play, because it is in Minnesota’s backyard–the Dakotas and Saskatchewan. Two years after this article appeared, is no long an untapped oil source:

The Kiplinger Letter article reads:
“The Bakken Play:  With up to 100 billion barrels of oil, the reserves locked under rocks buried a mile or more beneath Montana and Saskatchewan, Canada, are more than twice the size of Alaskan’s entire oil cache. New drilling and oil recovery technologies are overcoming production obstacles and petroleum companies are rushing to stake their claims. Marathon Oil recently acquired about 200,000 acres in the area and will drill about 300 oil wells within five years. Brigham Exploration and Crescent Point Energy Trust also want a piece of the action. EOG Resources alone figures it can produce 80 million barrels of oil from its Bakken field. But It will take at least five years before the oil starts flowing in large volumes.”

Read more at:
http://www.kiplinger.com/businessresource/forecast/archive/The_U.S._s_Untapped_Bounty_080630.html

A genetically modified crop benefits a non-modified crop by killing pests, University of Minnesota study finds

(press release from University of Minnesota)

Transgenic corn’s resistance to pests has benefitted even non-transgenic corn, a new study led by scientists from the University of Minnesota shows.

The study, published in the Oct. 8 edition of the journal Science, found that widespread planting of genetically modified Bt corn throughout the Upper Midwest has suppressed populations of the European corn borer, historically one of corn’s primary pests. This areawide suppression has dramatically reduced the estimated $1 billion in annual losses caused by the European corn borer, even on non-genetically modified corn. Bt corn, introduced in 1996, is so named because it has been bred to produce a toxin from the soil bacterium Bacillus thuringiensis (Bt) that kills insect pests.

Corn borer moths cannot distinguish between Bt and non-Bt corn, so females lay eggs in both kinds of fields, said the study’s chief author, University of Minnesota entomology professor William Hutchison. Once eggs hatch in Bt corn, young borer larvae feed and die within 24 to 48 hours. Because it is effective at controlling corn borers and other pests, Bt corn has been adopted on about 63 percent of all U.S. corn acres. As a result, corn borer numbers have also declined in neighboring non-Bt fields by 28 percent to 73 percent in Minnesota, Illinois and Wisconsin, depending on historical pest abundance and level of Bt-corn adoption.  The study also documents similar declines of the pest in Iowa and Nebraska. This is the first study to show a direct association between Bt corn use and an areawide reduction in corn borer abundance.

Economic benefits of this areawide pest suppression have totaled $6.9 billion over the past 14 years for the 5-state region. Surprisingly, non-Bt corn acres accounted for $4.3 billion (62 percent of this total benefit.) The primary benefit of Bt corn is reduced yield losses, and Bt acres received this benefit after the growers paid Bt corn technology fees. But as a result of areawide pest suppression, non-Bt acres also experienced yield savings without the cost of Bt technology fees, and thus received more than half of the benefits from growing Bt corn in the region.

Our Take:
The miracle of Bt Corn has boosted yield in both GM and conventional acres. The significance of this cannot be overstated. Over the past 14 years these yield gains have meant $6.9 billion dollars more in the pockets of farmers. Not only has this money flowed directly into main street businesses across rural Minnesota and the whole Corn Belt, but a chunk of this $6.9 billion dollars is the money that has helped to build farmer-owned, farm-based energy production–ethanol and biodiesel in America.

Farmer ownership of ethanol creates a perfect hedge that keeps farmers in business.

It’s no coincidence that Bt corn and farmer-owned ethanol started up about the same time. The yield gain from crop science, together with significant new uses for corn, is what has allowed Corn Belt farmers to stay in business. Period.

And crop science is the reason that the food-vs-fuel argument is a complete fallacy. The abundance of #2 yellow field corn allows us to continue to export huge volumes of it, still have every bushel the American livestock industry can use and accommodate the booming ethanol industry all at the same time.

And the crop science revolution is far from over. In the coming decade, the major seed companies plan to market corn varieties genetically enhanced to feature greater water efficiency and resistance to heat stress.