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Indian researchers see opportunities in sorghum for ethanol and bioplastics

Biofuels Digest - Tue, 07/24/2018 - 2:13pm

In India, ICRISAT researchers have found that sorghum could be used in existing sugarcane mills to produce ethanol and co-generated power without having to make any adaptations, allowing farmers and mills to switch to the more water efficient crop. Field trials with 10,000 farmers in Telegana using in-field crushing supplied juice to ethanol distilleries and received higher prices for the bagasse compared to sugarcane. With a dozen proposed ethanol plants expecting to use sorghum as feedstock, researchers are looking at the possibility of using the ethanol produced for bio-plastics as well.

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C.D. Howe Institute cautions Canada on clean fuel standards

Biofuels Digest - Tue, 07/24/2018 - 2:10pm

In Canada, Ottawa should clear up confusion about its plans for clean fuel standards, according to a new report by the C.D. Howe Institute.  In “Speed Bump Ahead: Ottawa Should Drive Slowly on Clean Fuel Standards” author Benjamin Dachis argues federal policymakers must examine the inherent limitations and potential economic costs of a clean fuel standard system.

Among the author’s recommendations are:

The federal  government should complete and release its own estimates of the economic cost of a CFS. If the economic cost of the proposed CFS plan is higher than a price on emissions, the federal government should have specific cost/benefit reasons to justify a CFS in addition to a price on emissions.

Ottawa should be mindful of policies that are effective when targeted at households, but burdensome for businesses, particularly emissions-intensive, trade-exposed businesses.

To favour a price on emissions over a CFS, since it is the most cost-effective way to reduce emissions. A CFS should only be considered should effective carbon pricing become politically unachievable.

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Indonesian biodiesel consumption won’t hit target this year but exports will jump

Biofuels Digest - Mon, 07/23/2018 - 7:49pm

In Indonesia, Reuters reports that biodiesel consumption will likely be lower than the expected 3.5 billion liters this year, coming in somewhere between 3.2 billion liters and 3.3 billion liters. At the same time, the national biodiesel producers association estimates that exports of biodiesel will be around 800 million liters this year, with as much as half of that volume exported already during the first half of 2018. The country exported almost no biodiesel last year.

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Stealthy Spanish ethanol fuel cell submarine overbudget and behind schedule

Biofuels Digest - Mon, 07/23/2018 - 7:48pm

In Spain, the highly advanced bioethanol fuel cell-powered S-80 submarines currently under construction in Cartagena now won’t likely be ready until 2022 and are expected to cost nearly $1.14 billion each after delays and overruns to the project doubled the costs and pushed the delivery date for the four vessels by nearly a decade. The vessels are also three meters too long for the docks where they’re being built. That said, the engines will be the most advanced in the global fleet with the vessels able to keep a constant speed of four knots underwater for four weeks without having to surface, compared to just a few days for diesel counterparts that must surface to let out air. The ethanol fuel cell engines will expel carbon dioxide-byproduct into the water via a special waste extractor that minimizes bubbles, increasing stealth capacity.

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Biodiesel tank catches on fire in Florida leaving firefighters looking for foam

Biofuels Digest - Mon, 07/23/2018 - 7:47pm

In Florida, a 180,000–gallon storage tank holding around 60,000 gallons of biodiesel caught fire at Port Manatee late Sunday night that took firefighters by surprise when they found they only had 1,900 gallons of the foam required to put out the blaze, compared to the 3,500 gallons they needed. Nearby stations jumped in to help put out the fire. About eight inches of fuel were left in the tank but the tank’s roof collapsed allowing firefighters to dump the foam right on top and get it under control. Local TV stations reported the cause of the fire was unknown.

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Indian McDonald’s franchisee goes in big for UCO biodiesel

Biofuels Digest - Mon, 07/23/2018 - 7:46pm

In India, the Press Trust of India reports that the McDonald’s master franchisee for the western and southern parts of the country is rolling out a pilot program where used cooking oil from its restaurants will be used to produce biodiesel that will then fuel part of its refrigerated truck fleet. The pilot will start in Mumbai, where 35,000 liters of UCO from 85 restaurants will be recycled, and will then expand to Bengaluru before expanding to all 277 of is restaurants. The company teamed with Australia’s BioCube earlier this year to convert the UCO into fuel.

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Brazilian hydrous ethanol most competitive against gasoline in 8 years

Biofuels Digest - Mon, 07/23/2018 - 7:45pm

In Brazil, Platts reports that the ANP fuels agency says that hydrous ethanol was at its most competitive against gasoline in eight years the week of July 8 at around 71 cents per liter, making it 60.31% of the price of gasoline at the pump, compared with 60.81% the week prior. During the first half of July, Petrobras raised the price of gasoline by 2.5% that helped to make ethanol even more competitive at the pump.

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Appeals court says EPA should look again at hardship waiver for WV refinery

Biofuels Digest - Mon, 07/23/2018 - 7:43pm

In Maryland, Reuters reports that the 4th U.S. Circuit Court of Appeals in Maryland has ruled the Environmental Protection Agency must reconsider a hardship waiver denied to Ergon’s 23,500 barrels per day specialty refinery in Newell, West Virginia. The court said the agency relied on “error-riddled” analysis it got from the Department of Energy that it says didn’t take into account the difficulty of supplying the specialty lube products and diesel produced by the refinery into the local market.

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Imperial College researchers develop translator so bacteria can “talk” to each other

Biofuels Digest - Mon, 07/23/2018 - 7:42pm

In the UK, scientists have designed a type of translator that allows different types of bacteria to ‘talk’ to each other. The findings, from scientists at Imperial College London, allow bacteria that don’t usually live together – such as those that normally live on the skin, and those that live in the sea, to communicate. The research, published in Nature Communications, could pave the way for engineering new bacteria systems to aid a number of processes, such as producing green energy.

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UK opens public comment period regarding E10 proposal

Biofuels Digest - Mon, 07/23/2018 - 7:41pm

In the UK, the Department for Transport has opened a public consultation through September 16 seeking feedback on the proposal to boost ethanol blending to 10% from the current 5% mandate. The policy is in line with the European Union’s Renewable Energy Directive that requires 10% renewable energy consumption in transport by 2020. Domestic ethanol producers have complained that failure to implement E10 has led to jeopardize their economic viability.

This consultation seeks feedback on:

  • • proposals to ensure a continued supply of traditional E5 petrol for those motorists who will need it
  • • a call for evidence on whether and how best to introduce E10 petrol
  • • proposals to implement new fuel labelling as required by the Alternative Fuels Infrastructure Directive
  • • plans to change the consumer message that must accompany the sale of E10
Categories: Today's News

Biomass, biomass and more biomass: The Digest’s 2018 Multi-Slide Guide to the DOE’s Billion Ton Report, Vol. 1

Biofuels Digest - Mon, 07/23/2018 - 6:19pm

The US Department of Energy’s Billion-Ton Report: Advancing Domestic Resources for a Thriving Bioeconomy says that 1.2 billion tons of biomass would be available at $40 or less per ton by 2040, and 1 billion tons would be available by 2030, for conversion into biofuels.

Compared to the original Billion Ton Report in 20111,  the focus has shifted from solely the cost of biomass at the farm gate to the Delivered price. The Report itself can be accessed in full here.

Here’s a slide deck overview of the Report’s findings given by the DOE’s Mark Elless.

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Deeper into the biomass: The Digest’s 2018 Multi-Slide Guide to the DOE’s Billion Ton Report, Vol. 2

Biofuels Digest - Mon, 07/23/2018 - 6:15pm

The US Department of Energy’s Billion-Ton Report: Advancing Domestic Resources for a Thriving Bioeconomy says that 1.2 billion tons of biomass would be available at $40 or less per ton by 2040, and 1 billion tons would be available by 2030, for conversion into biofuels.

Compared to the original Billion Ton Report in 20111,  the focus has shifted from solely the cost of biomass at the farm gate to the Delivered price. The Report itself can be accessed in full here.

Here’s a slide deck overview of the Report’s Vol 2. findings given by the DOE’s Kristen Johnson.

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Biofuels: a straightforward fix for US farmers’ tariff exposure to China?

Biofuels Digest - Mon, 07/23/2018 - 3:48pm

This is the first of a two-part series in which we look at strategic shifts in global commodity prices and policies that could dramatically impact the outlook for biofuels, In this part, we look at grain markets and the em,erging US-China trade war.

As most know by now, the US and China have fired opening salvos in a trade war, with the US targeting a range of commodities including steel and aluminum, and China retaliating with, to date, stiff tariffs on a range of agricultural products, but primarily hitting soybeans and corn because of the volume of trade in those agricultural goods. Overall, China imports $24 billion of agricultural goods from the US and is a leading export market for the US. 

The trade wars prompted North Dakota farmer Kevin Skunes, president of the National Corn Growers Association, to state:

“Farmers are busy with planting season but are moving forward without knowing who will buy their crop when it’s harvested later this year. With a 52 percent drop in net farm income over the last five years, and depressed commodity prices, this is not the time to face such a burden. This uncertainty impacts every step of the agriculture economy, from securing financing to marketing.”

A straightforward fix in E15 fuels

While the causes of world trade tensions are myriad,  the agricultural remedy for grain-related distress is simple, and that is moving to year-round E15 ethanol in the US — reducing the need for corn farmers to seek export markets in the short-term as crop yields continue to rise through improved practices and better seeds. That’s well below the 20-25 percent baseload blends used safely and effectively for decades in Brazil.

Forcing corn farmers to scale back production or export grain at reduced prices into the smaller markets that remain open to them (and assuming that they will remain open should the trade wars widen) — that’s a recipe for economic disaster in the US Midwest and potentially for electoral disruption to follow — as farmers seek to institute new Government…as to them shall seem most likely to effect their Safety and Happiness,” as agriculturalist Thomas Jefferson spelled it out in the Declaration of Independence.”

The job, energy and clean air nexus all over again

Who pays the price? Although the US has made great strides towards energy independence, the country is still a net importer of petroleum — especially outside the South — and it’s only sensible to pivot towards more domestic production drawn from the replenishable grain belt instead of tapping one-and-done petroleum resources. 

Capacity-building exercises would also prove of great benefit to the construction industries and a boost to Midwest-based jobs in the lead-up to the next two election cycles. It seems like a no-brainer for Republican parties across the spectrum to band together to shore up support in a swing region that handed control of the White House and the Congress to the GOP in the last cycle. And, if the EPA is on board in effectively structuring the demand, cellulose ethanol could receive a similar boost — which would cheer any fan of advanced technology and sharp[ reductions in greenhouse gas emissions.

There’s much of benefit to multiple parties from increasing ethanol demand — and it wouldn’t hurt either to take a good look at opportunities that may be present for sorghum and soybeans to increase their domestic markets right now. 

We’ll see how the Administration responds. 

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Gevo & Butamax – Remind Me Why I Care

Biofuels Digest - Mon, 07/23/2018 - 3:20pm

By Sam Nejame,
Special to The Digest

Here in Cambridge it’s humid and the spritely Liz Warren will soon be seen power walking in a straw hat through my neighborhood again. Amidst the brimstone of the ongoing blue/red culture war, it is useful to consider that even the less than conscientious former EPA chief Scott Pruitt can do some good, with implications that could reach many billions of dollars and portend big changes in agriculture, alcohol fermentation, and fuel and chemical production as we know it.

Last month, when EPA announced it had approved higher iso-butanol content in gasoline blends, you’d be forgiven for not paying much attention. But then GEVO’s stock popped 700% over a few spicy days.  That got traders and all those numbers guys chattering as if GEVO was the latest crypto-chit.  In the weeks leading up to this, GEVO had completed another reverse stock split in order to keep itself above NASDAQ minimums.  And although I am not suggesting any prior market knowledge of the EPA announcement, we may now guess what Scott Pruitt was doing in his $43,000 soundproof phone booth… He was making plans to approve a higher blend rate for a better biofuel.

Despite the explosive inflation and deflation of GEVO’s stock, the successful announcement was largely the work of Butamax not GEVO, and you could have looked for a bump in the stock of its’ parent companies, but given you can’t buy Butamax bio-butanol blended gasoline (there is a small amount of GEVO “ethanol free” blended gasoline sold at marinas and some truck stops) there was no such reaction.  Both Butamax and GEVO have suffered mightily over the last few years, but the people, who have hung in there and put their careers on the line to make it happen may indeed have finally turned a corner.

This is why I care

To say biofuels are not sexy these days is to engage in vast understatement.  Moving from extractive to renewable fuels and chemicals production has not been easy. And there’s no need to recap the failure of Industrial Biotechnology at large or the wholesale shift in focus from fuels > chemicals > specialty chemicals > food/feed > nutraceuticals, F&F, etc.  Each representing a step down in market size and a step up in value per measure.  So, why bang your head on the wall of thermodynamics and try to force biological systems to do things they don’t want to do (only to make pseudo-commodities)? Answer: Because nothing comes close to the market size and value of fuels and chemicals and if you’re big, small markets don’t move your revenue or net income numbers.

Take a look at ExxonMobil’s 10Q sometime.  You will see what I call the 1040 rule in action. That is chemicals make up only 10% of refining revenues, but 40% of profits. We need to think of a biorefinery in the same way and it’s important to note, this works in reverse.  Flavors and fragrances are great high value molecules, but they also represent very small markets. In terms of Industrial Biotechnology, that’s a lot of metabolic engineering for not a lot of product.

I’m not going to recount all the physical and economic benefits butanol has over ethanol.  That’s a story too many times told elsewhere under brighter skies. But the truth is large scale production of butanol has the potential to disrupt many markets, some obvious others less so.  If implemented it could drastically increase corn production and spur construction of new plants along with the retrofitting of existing ethanol plants.  Refiners would be able to blend and retake margins (and RINs) long lost to fuel distributors/retailers.  In many parts of the country refiners could avoid expensive reformulated blendstock for oxygen blending and simultaneously utilize inexpensive heavier natural gas liquids from midstream suppliers. In the US, the largest blenders of butanol fuel oxygenate would likely include: Valero, ConocoPhillips, ExxonMobil, BP, Marathon Petroleum, Chevron and Sunoco.

And that’s just the beginning

If we take it a step further and think about butanol priced at fuel value, we could see many other potential impacts.  Particularly, the replacement and substitution of petroleum based iso-butanol and n-butanol in chemical derivatives.  Granted, this could also require reformulation of n-buoh based products and issues like steric hindrance will not allow it for all applications. However, if the price is right and the supply is sustainable… You will get companies buying fuel grade, and cleaning it up.  Broadly, for all makers and users of:  solvents, adhesives, plasticizers, amino resins, and butyl amines there will be strategic impact.  And of course, readily available butanol biofuel would impact nobody more so than Dow, North America’s largest captive producer of buoh and derivatives.  In addition:

For butyl acrylates we would see impacts in the businesses of: Dow-Dupont and their progeny, BASF, American Acryl, Nippon Shokubai, and Arkema.  For butyl methacrylate: Dow and Lucite.  For makers of glycol ethers changes may be coming for: Dow, Eastman, and LyondellBasell.  For butyl acetate: Dow, Eastman, and OXEA.

Butanol solvent and derivatives are widely used in paints and coatings.  Availability of inexpensive high purity butyl fuel will create opportunities for paint makers: Axalta, Akzo Nobel, PPG, Sherwin Williams, and Valspar.

Other companies that could be impacted include: Ferro Corporation, Georgia Pacific Resins, US Amines, Taminco, Chevron Oronite, Rhodia, ICL Industrial Products, Lubrizol, Infineum, Afton and Elco.

Across the pond in Western Europe this will affect merchant buyers like Shell, Celanese, ICI, PPG, Evonik, Plastificantes de Lutxana, Proviron, and Polynt.

To be sure this is only a partial list and clearly, this is only going happen following the large scale conversion of ethanol plants and competitive pricing of iso-butanol.  Still, what we are talking about could be very important going forward. The stakes are high and smart companies will have strategies ready before it starts to happen. While it’s easy to be cynical given the rocky performance of Industrial Biotechnology applications, it’s wise to consider that not so long ago the vast majority of ethanol was produced from petroleum feedstock.  Butanol could easily see similar displacement.  Change lies in every direction.  So, now I guess we’ll just begin again.

Nonsense, we will bury you

While the story of renewable butanol like other attempts to replace synthetic chemistry with synthetic biology is still being written, it is interesting to consider the perspective of entrenched market leaders, most with fully depreciated assets or like Saudi Butanol Company with brand new low cost manufacturing capacity.  Traditionally, these companies respond to an upstart in draconian fashion. Dropping prices to cost and holding them their until the new entrant suffocates, puts its tail between its legs and shuts down. After which, the leader raises prices and gets on with it.  But biofuels operate in regulated markets and available credits will indirectly lower resultant average cost as those credits get shared across the value chain.  How exactly those would be divvied up is interesting to think about.  In the end I am reminded of a conversation I had with executives at Dow, who said, “Sure, if you can make it cheaper than we can, we’ll buy it from you.”  At the time I took it as a challenge as much as an offer.

Some will spend another pointless year foaming at the mouth. Do the economics work nationally or only in California and Canadian provinces with a Low Carbon Fuel Standard? Will incentives be effectively distributed a cross the value chain or will they be captured for the benefit of a few? We will see.  Whatever the outcome there are a whole lot of companies out there that haven’t given renewable butyl fuels and chemicals much thought.

It is interesting to look in the rearview mirror at an EPA chief that was so toxic he was rejected by this president.  From the beach we watch Andrew Wheeler step into the breach. Will he be the coal roller my neighbor thinks he is or will there be another silver lining?  There are those who own their minds and those who crawl. Which is which and who is who?

Sam Nejame is CEO of Promotum, a management consulting firm focused on business development and market analysis. His practice covers the fields of petroleum, bio-based fuels, chemicals and biologics. He can be reached at snejame@promotum.com.

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An emerging alternative marine fuel: The Digest’s 2018 Multi-Slide Guide to Methanol

Biofuels Digest - Mon, 07/23/2018 - 2:17pm

The marine sector consumes 370 million metric tonnes of bunker fuel per year, and stakeholders desire a viable pathway to low- & no-carbon marine fuels. The fuels need to be price competitive with current bunker fuels and other alternatives such as LNG. Fuel needs to be available globally. And, ship operators need to be assured of safe handling on-board vessel and for bunkering.

Methanol Institute CEO Greg Dolan and team assembled this remarkable look at marine markets and the role that methanol might play as a sustainable fuel.

The Methanol Institute was established in 1989 to lobby the US Congress. 29 years later, MI is recognized as the trade association for the methanol industry, representing world’s leading methanol producers, distributors and technology companies. More about the Institute here.

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Trade conflict puts damper on USDA export outlook

Biofuels Digest - Sun, 07/22/2018 - 1:54pm

In Germany, UFOP reports that the U.S. Department of Agriculture expects the U.S. export potential to shrink because of the slowdown in demand from China in the wake of the trade dispute with the U.S. The USDA raised its forecast of 2018/19 US soybean production and now expects output to reach 117.3 million tonnes, up from the previous month’s estimate of 116.5 million tonnes. Although this figure is slightly lower than a year earlier, it is set to lead to a swell in ending stocks. According to Agrarmarkt Informations-Gesellschaft mbH (AMI), the explanation is that sales, especially to foreign countries, are in danger of dwindling in the wake of the trade conflict between the US and China. Both countries have imposed high punitive tariffs on each other’s imports. China charges import duties of 25 per cent on US soybeans and is consequently looking for alternative sources. This situation is already reflected in the current USDA export estimate, since the forecast has been lowered significantly to 55.5 million tonnes, from 62.3 million tonnes the previous month. This means that US exports will shrink to even less than the previous year’s volume. A large crop and smaller exports cause the already large US soybean stocks to increase further to record high levels. USDA expects stocks to climb to just less than 16 million tonnes. This translates to a 25 per cent rise from the previous year.

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Researchers Discover New Enzyme Paradigm for Critical Reaction in Converting Lignin to Useful Products

Biofuels Digest - Sun, 07/22/2018 - 1:53pm

In Washington, D.C., an international research team, including scientists from the U.S. Department of Energy’s National Renewable Energy Laboratory (NREL), discovered and characterized a new family of cytochrome P450 enzymes that is critical to improving the conversion of lignin into valuable products such as nylon, plastics, and chemicals.

The study outlines how the international team of researchers determined the molecular structure of a previously uncharacterized cytochrome P450 that turned out to have a completely different, two-component architecture, which represents a new class of P450s: Family N.

Learning about the structure and function of enzymes helps scientists improve the microbes and thus enhance processes like the biological conversion of lignin from plant biomass into valuable products. And P450s are a great place to start. Researchers studied how the enzyme interacts with its products and substrate and quickly realized that this cytochrome P450 is more than a guaiacol specialist; it’s a generalist that can perform demethylation on a variety of substances. Demethylation is the simple chemistry of removing a methyl group, and the microbial conversion of lignin relies on this critical reaction.

 

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Ethanol production rebounds from last week

Biofuels Digest - Sun, 07/22/2018 - 1:51pm

In Washington, D.C., ethanol production rebounded to an average of 1.064 million barrels per day (b/d)—or 44.69 million gallons daily, according to government data released and analyzed by the Renewable Fuels Association. That is a 32,000 b/d (3.0%) upturn from the week before. The four-week average for ethanol production remained firm at 1.059 million b/d for an annualized rate of 16.23 billion gallons. Stocks of ethanol were 21.8 million barrels. Reserves narrowed 2.7% from last week. There were zero imports recorded for the 32nd week in a row.

Average weekly gasoline demand rallied 4.7% to 407.7 million gallons (9.708 million barrels) daily. This is equivalent to 148.82 billion gallons annualized. Refiner/blender input of ethanol pared back for the second straight week, slipping 1.8% to 913,000 b/d. This is equivalent to 14.00 billion gallons annualized and the softest demand in six weeks. The ethanol content in gasoline supplied to the market averaged 9.40%, down from 10.03% the previous week and 9.60% a year ago. Expressed as a percentage of daily gasoline demand, daily ethanol production decreased to 10.96%.

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Queensland as biofuel hub talked about in D.C., Tindal becomes advisor

Biofuels Digest - Sun, 07/22/2018 - 1:49pm

In Washington, D.C., Queensland’s potential as a biofuel hub in the Asian Pacific region was brought up during government meetings in D.C. last week between Queensland’s Minister for State Development, Manufacturing, Infrastructure and Planning Cameron Dick and the U.S. Department of the Navy. The Minister met at the Pentagon with biofuel experts and announced the appointment of Queensland’s new US-based Strategic Biofutures Advisor, Chris Tindal, according to Manufacturers’ Monthly.

Tindal is the current assistant director of the Commercial Aviation Alternative Fuels Initiative, and the former director for Operational Energy, US Navy, as well as an adjunct professor at the Centre for Tropical Crops and Biocommodities at the Queensland University of Technology.

The Queensland government and the US Department of the Navy signed a Statement of Cooperation in August 2016 to collaborate on developing alternative fuels. “Since the agreement with the US Navy was signed we have seen positive growth for the industry here, Minister Dick told Manufacturers’ Monthly. “The Northern Oil Advanced Biofuels Pilot Plant, Australia’s first advanced pilot biofuels refinery, has been constructed, and work is underway for the production of fuels that meet military requirements.”

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Greenbelt Resources narrows location search to Monte Vista Area

Biofuels Digest - Sun, 07/22/2018 - 1:47pm

In California, Greenbelt Resources Corporation, developer and producer of an ECOsystem model that transforms waste into revenue generating bioproducts, announced that Biofuels and Energy, LLC, a New Mexico based project development company planning to utilize Greenbelt’s proprietary ECOsystem model for its SLV Biopro Project, has selected four locations on which to potentially locate project operations in the San Luis Valley region of Colorado.

SLV Biopro was announced earlier this year as the first of B&E’s projects committed to using Greenbelt’s ECOsystem technology to convert agricultural waste into various bio-based products such as bioethanol and high protein animal feed.  Other B&E projects currently in development will be located in New Mexico and Pennsylvania.

“Greenbelt agrees with B&E’s narrowed selection of site locations,” said Greenbelt CEO Darren Eng. “Each of the site finalists has unique characteristics that will benefit the efficiency of our ECOsystem model, including such features as space for a duckweed covered discharge pond and proximity to specific feedstocks which would enable new high value bioproducts to be produced.”

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