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PES deal on RINs could cut ethanol mandate by 2%

Biofuels Digest - Wed, 03/28/2018 - 4:59pm

In Washington, Platts reports that consultants the Brattle Group believe if Philadelphia Energy Solutions is allowed to forego half of its RIN buy for 2016 and 2017 as part of a proposed settlement with the Department of Justice, as much as 2% of the ethanol blending mandate would shrink and RIN prices would fall accordingly as demand slips. RIN prices have recovered more than 20% since a low earlier this month thanks to expectations that the Trump Administration will wait for lawmakers to battle out the RIN issue, but are still 30% lower than when the White House announced it would try to broker a deal.

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Royal DSM announces commitment to advanced biofuels industry

Biofuels Digest - Tue, 03/27/2018 - 5:04pm

In Illinois, Royal DSM announced its commitment to bring innovative solutions to the biofuels industry with a full portfolio offering of yeast and enzymes for starch, fiber and biomass conversions.

• For starch conversion, DSM says its yeast is tailored to provide a consistent increased ethanol yield, while significantly reducing glycerol production.
• For fiber conversion, DSM says its enzyme formulation maximizes hydrolysis with an enhanced liquefaction capability. In addition, it says the yeast can convert all available sugars at a high rate including glucose, xylose and arabinose.
• For biomass conversion, DSM offers both high performing yeast and enzymes solutions for multiple feedstocks and have an active partnership with POET-DSM Advanced Biofuels and its Liberty plant in Emmetsburg, Iowa for corn stover to ethanol production.

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European farmers union push for biofuels ahead of triologue talks on REDII

Biofuels Digest - Tue, 03/27/2018 - 5:02pm

In Belgium, ahead of trilogue talks between the EU institutions on the EU’s renewable energy plans, Copa and Cogeca call for a stable long-term policy to maximize the potential of crop-based biofuels to decarbonize the transport sector.

Copa and Cogeca have adopted an updated position on the promotion of EU renewable energy. Outlining key points needed for a successful policy, he urged the EU to maintain at 7% until 2030 the maximum share for crop-based biofuels used in transport. There also needs to be a binding blending obligation on fuel suppliers of at least 14%, without technological restrictions. The contribution of palm oil and its derivatives to the EU’s climate and environmental objectives should be rejected too as long as sustainability problems such as deforestation in the country of origin remain unresolved.

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China February ethanol imports soar to 21-month high at 197,652 cubic meters

Biofuels Digest - Tue, 03/27/2018 - 5:01pm

In China, Reuters reports that February ethanol imports jumped to 197,652 cubic meters, the highest imports seen since May 2016, with 189,035 cubic meters coming from the US. Cheap US ethanol due to high stocks mean that landed ethanol is still profitable even with the 30% import tariff in place. Threats of boosting that import tariff in retaliation of President Trump’s proposed steel tariffs would likely close that arbitrage window, however, putting a damper on US exports just as they were beginning to ramp up.

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Indonesia rattling Norway’s cage over proposed palm oil ban

Biofuels Digest - Tue, 03/27/2018 - 5:00pm

In Indonesia, even though trade with Norway is limited and has been shrinking since 2012, the Indonesian Ministry of Trade is still threatening to stop imports of Norwegian fish if the Nordic country goes ahead with the palm oil ban proposed by Parliament last year. The threat is more symbolic than anything else due to similar threats by the European Parliament to ban palm oil for biofuels, a threat Indonesia has been lobbying hard on a member state level to stave off.

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Interest growing for hydrogen production from biodiesel in Queensland

Biofuels Digest - Tue, 03/27/2018 - 4:59pm

In Australia, local media reports there is growing interest to produce hydrogen from biodiesel produced by Northern Oil, fuel that could be exported to Japan for use during the 2020 Olympic games. Two companies have already indicated interest in developing hydrogen in Gladstone, Queensland region near the Northern Oil facility thanks to the state development area and the port. Local authorities want to promote the implementation of pilot and demonstration projects in the region to further attract investment.

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Verbio CEO says Argentina and Indonesian biodiesel imports could reach 5 million tons

Biofuels Digest - Tue, 03/27/2018 - 4:58pm

In Germany, Reuters reports the CEO of German biofuels producer Verbio AG said Argentine and Indonesian biodiesel producers can sell landed biodiesel in Europe for as much as $60 per metric tons cheaper than European biodiesel producers can source feedstock, meaning the European market is likely to be inundated with imports following the European Court of Justice ruling that struck out anti-dumping duties. He expects imports to reach as high as 5 million tons against demand of 12 million tons.

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NREL researchers pinpoint opportunities to engineer enzymes for better biomass conversion

Biofuels Digest - Tue, 03/27/2018 - 4:57pm

In Colorado, it was more than 10 years in the making, but when it came to uncovering the secrets of the molecular structure of enzymes, perseverance paid off. By studying and comparing the workhorse cellulose-degrading enzymes of two fungi, researchers from the Energy Department’s National Renewable Energy Laboratory (NREL) have pinpointed regions on these enzymes that can be targeted via genetic engineering to help break down cellulose faster.

Newly published in Nature Communications, “Engineering enhanced cellobiohydrolase activity” describes NREL’s long-running study of the fungal cellobiohydrolases (CBHs)—enzymes that use hydrolysis as their main chemistry to degrade cellulose—Trichoderma reesei (TrCel7A) and Penicillium funiculosum (PfCel7A). Years of meticulous research have yielded big rewards: the team has gained a better understanding of the structure-activity relationships of these enzymes to predict the best places to make changes and improvements.

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Biofuel industry hits back at proposed PES RIN compliance bailout

Biofuels Digest - Tue, 03/27/2018 - 4:55pm

In Washington, unsurprisingly the biofuels industry has overwhelmingly come out in opposition of the Environmental Protection Agency and Department of Justice’s proposed deal with Philadelphia Energy Solutions to offer a bail out on its RIN compliance. The National Biodiesel Board called on the DOJ to reconsider its proposed settlement allowing PES Holdings to escape the vast majority of its 2016-’17 obligations under the Renewable Fuel Standard. The proposed settlement would harm the renewable fuels industry and undermine the intent of the RFS program by excusing more than 70 percent of the company’s compliance obligations for the two-year period. The proposed PES settlement agreement, which covers the refiner’s RVOs for January 2016-April 2018, should be rejected “because the terms are patently unfair, unreasonable, and inconsistent with the purposes of the RFS program,” the Renewable Fuels Association wrote. The U.S. Bankruptcy Court of Delaware has to approve PES’ proposed settlement agreement on April 4. The Biotechnology Innovation Organization said, “Philadelphia Energy Solutions’ claim to the bankruptcy court that the Renewable Fuel Standard program caused its financial difficulties is specious at best. The record shows that the refiner ignored its RFS compliance obligations and sold renewable fuel credits for profit, in order to pay unearned dividends to its Wall Street shareholders. This proposed settlement agreement undermines the goals of the RFS by allowing the refiner to profit by escaping its obligations under the law.

RFA Opposes Proposed PES Settlement; Would Allow Refiner ‘to Have its Cake and Sell it Too’

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The Digest’s Top 10 Innovations, 3.28.18 release

Biofuels Digest - Tue, 03/27/2018 - 3:45pm

According to BIO, the global economic value today of the biobased economy – including industrial biotechnology, renewable chemicals and polymers, biofuels, enzymes and biobased materials – is $355.28 billion. And looking at the new USDA Indicators report and other sources, BIO estimates that the United States generates 58 percent of the global value of biobased manufacturing, or more than $205 billion. And that economic activity supports employment for 1.66 million U.S. workers.

The driver? Rampant scientific innovation, which we are going to be highlighting in a four-part series which kicks off a new Digest weekly feature — Top 10 Innovations.

The pace of invention and change is just too strong, we’ve realized, to highlight annual or even quarterly or monthly rankings and summaries of significant product and service advances. For now, we’re going to be tracking these on a weekly basis to keep pace with the changes.

Case in point? The USDA BioPreferred Program, which facilitates the development and expansion of markets for biobased products, the number of renewable chemicals and biobased products that are USDA-certified has rapidly increased from 1,800 in 2014 to 2,900 in 2016.

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Nth Power and Nth Plant: The Digest’s 2018 Guide to Process Scale-Up, or Not?

Biofuels Digest - Tue, 03/27/2018 - 3:31pm

You probably knew him first as the VP for Biofuels at Chevron, and later the Program Manager for the DOE Biomass program. Paul Bryan’s a noted consultant on technology development and sometime lecturer in chemical engineering at Berkeley when not on the ABLC stage with the Due Diligence Wolfpack.

“I apply my background in industry (Chevron) and government (DOE) to assess the techno-economic and market prospects for new technologies in renewable fuels and chemicals, and to help advance them to commercialization,” Bryan notes. His objective assessment of technologies, projects, companies, strategies, and opportunities in light of the current state of affairs (technical, business, and regulatory) have a legion of fans around the world these days.

His latest musing, Nth Power and Nth Plant – Process Scale up, or Not? was the subject of this presentation at ABLC 2018 in Washington DC.

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ADM temporarily mothballs German biodiesel plant in light of growing imports

Biofuels Digest - Mon, 03/26/2018 - 8:19pm

In Germany, Reuters reports that ADM has decided to mothball its biodiesel plant in Mainz for at least Q2 because it can’t compete with increasing cheap imports that began to surge last September, especially following the ruling last week by the European Court of Justice dropping anti-dumping duties on Argentine and Indonesian biodiesel imports. A decision on whether or not to reopen in Q3 will be made in a few months depending on prices and crushing margins.

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Air New Zealand says it will be at least 10 years before aviation biofuels commercial

Biofuels Digest - Mon, 03/26/2018 - 8:18pm

In New Zealand, Air New Zealand says that despite talking with 30 companies following its call to source 20 million liters of aviation biofuels last year, no one is scalable at the moment to be able to supply the kinds of volumes the airline is looking for in the medium term. The CEO says that it will be another decade before aviation biofuels are available in commercial volumes, so the company will look to offset its emissions in other ways while reducing energy and fuel consumption via technological solutions.

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Biodiesel leaked from barge on Mississippi River near New Orleans

Biofuels Digest - Mon, 03/26/2018 - 8:17pm

In Louisiana, the Associated Press reports that a barge carrying biodiesel moored on the lower Mississippi River near New Orleans has leaked nearly 10,000 gallons after a wake caused by another vessel slammed the barge into a concrete wall. The leak has since been stopped and measures put in place to absorb the leaked fuel. No water restrictions were issued as a result of the accident that led to the leak. The vessel was carrying 21,150 gallons of biodiesel.

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Brazilian hydrous ethanol production soars 70% on year during H1 March

Biofuels Digest - Mon, 03/26/2018 - 8:16pm

In Brazil, Platts reports that UNICA figures show hydrous ethanol production during the first half of March jumped 70% on the year to 244 million liters, more than double that produced during the last half of February. With hydrous ethanol prices reaching the highest levels since Platts began tracking them in April 2014, it’s no surprise that mills are pushing hard to produce the fuel as fast as possible as they start up the season’s crush ahead of the traditional April 1 start date.

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USGC pushing hard to supply fuel ethanol to fill India’s supply gap

Biofuels Digest - Mon, 03/26/2018 - 8:14pm

In India, the US Grains Council is stumping for ethanol market access to supply the country’s E10 blending mandate that it has failed to source locally. The USGC’s local representative says that landed US ethanol would cost about 45 cents per liter compared to 63 cents for domestic ethanol. The country doesn’t currently allow imports for fuel blending but does import about 40 million liters per year of US ethanol for industrial use. The USGC suggests sourcing what it can domestically and then allowing imports to fill the gap in order to reach the E10 mandate compared to the 4% expected for this season.

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Germany’s 2017 ethanol production fell with heavy hit to 2G

Biofuels Digest - Mon, 03/26/2018 - 8:13pm

In Germany, Renewables Now reports that ethanol production fell to 672,930 metric tons last year, down 8.8% on the year, while consumption also fell to 5.9% of gasoline consumption compared to 6.1% the year prior as ethanol sales fell nearly 2% as E10 demand stagnated. Total ethanol sales reached 1.154 million tons. Second-generation ethanol production saw a drop of nearly 28% last year with just 8,892 tons coming from non-food and waste feedstocks, prompting the ethanol producers association to call for more ambitious decarbonization in transport policies.

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University of Illinois, Urbana-Champaign researchers look to reduce phosphorus from corn byproducts

Biofuels Digest - Mon, 03/26/2018 - 8:12pm

In Illinois, researchers at the University of Illinois, Urbana-Champaign are using adding calcium to different corn byproducts and tweaking the solution’s pH in an effort to precipitate organic and inorganic phosphorus compounds in minutes. Doing so would not only create potential additional value using the phosphorus as fertilizer or as supplements for animal feed but could also reduce the volumes that end up in wastewater treatment plants and eventually water bodies that feed into the Gulf of Mexico.

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NBB disappointed omnibus spending bill didn’t reinstate biodiesel tax credit

Biofuels Digest - Mon, 03/26/2018 - 8:11pm

In Washington, the U.S. Congress passed an omnibus spending bill to fund the government that did not include a reinstatement of the biodiesel tax credit.

“The National Biodiesel Board is again disappointed that Congress has failed to provide pro-growth tax certainty for a domestic energy industry that has broad, bipartisan support. The lack of urgency by Congress to extend this expired tax credit continues to frustrate the producers, blenders and marketers of biodiesel,” said Kurt Kovarik, vice president of federal affairs for the National Biodiesel Board (NBB). “We will work to educate members of the economic and environmental benefits of increased use of biodiesel, so that Congress is poised to drive investments in this American energy industry.”

In February 2018, Congress passed a retroactive extension of the biodiesel tax incentive for 2017 only. But producers continue to operate in 2018 without a tax credit, which is forcing biodiesel producers nationwide to carry the risk of the uncertainty caused by the lack of the tax credit. For some small biodiesel producers, that can be the difference between keeping the lights on or shuttering down.

NBB has engaged in aggressive legislative outreach on this issue, taking meetings with elected officials each week on Capitol Hill, participating in a recent Congressional hearing on the issue and sending multiple letters to Congressional leaders making the case for renewal of the biodiesel tax incentive.

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The Circular Economy: It’s time has come

Biofuels Digest - Mon, 03/26/2018 - 3:40pm

By Kapil S Lokare, PhD
Special to The Digest

It is not difficult to find collective evidence that global human activities have begun to overrun the resources of the planet. It is clear that ‘business as usual’ is not an option that industry can maintain for long. With France’s Total investing over $1 billion in batteries, DONG Energy switching to a new business under now Ørsted. BPs investment of $200m in Europe’s solar market, Indian Oil preparing to diversify into green energy, Exxon Mobil making breakthrough in bio-oil from algae with over $1 billion/year investments!

Back in early 2000 – Who’d have thunk it – that investments in renewables would come from these giants?

But there is a catch. Prior to the energy crisis, most economies were too extravagant; now, they have now overreacted and have become retrenchment-mad. It is imperative to think rationally and design progress with the right analysis and tools to achieve a truly sustainable society.

Circular Economy: Does it really exist?

It is instructive to think of the supply chains involved with the earliest industrial developments.  It was a case then of unlimited resources and unlimited wastes. No one was constrained by resource scarcity. A contrasting picture is where the proximal resources are limited. In such a system, the resulting supply chains become strongly interlinked and form a complex supply chain as we know today. Here, the flow of materials within the proximal domain may be quite large, but the flows into and out of the domain (resources to waste) are quite small. Such a system is more efficient than the previous one, but clearly not sustainable over the long term because the flows are all in one direction. The system is ‘running down’.

To be ultimately sustainable, the system has to be cyclical in nature, with ‘resources’ and ‘waste’ being undefined, since waste to one component of the system represents resources to another. It should be noted that cycles within the system tend to function on widely differing temporal and spatial scales, a behavior that greatly complicates analysis and understanding of the system.

Many present-day processes and products remain largely dissipative such as lubricants, paints, pesticides, automobile tires. Some examples where the specific materials are sufficiently precious for example, precious metal recovery are not all dissipative and come close to the Model C. A classic example is the recycling of rhodium metal used in the Oxo-process to generate n- and iso-butanol wherein, the metal is recycled to ppb levels!

On the broadest of product and time scales, there are many examples today that the flows in the ensemble are so large that resource limitations set in: changes in global CO2 levels, unavailability of waste disposal sites etc. Accordingly, the entire supply chain and affiliated systems will be increasingly under selective pressure to evolve to move from Model A to Model C.

Such disruptive entities are missing and should be created by fiat, if the circular economy is to proceed at a rapid pace.

Ideally the organization will be a cyclic flow of materials within the model, as they evolve into various modes of operation that are more efficient, and have less disruptive impact on external support systems.

The key would be enhanced communication among specialists, a restraint on the use of jargon, and a willingness to develop new concepts to deal with new approaches to understand the functioning of individual processes.

Approaches to Circular Economy
  1. Material specific, that is, it selects a particular material or group of materials and analyzes the ways in which it flows through the entire supply chain. Such an analysis is generally made while products are in their manufacturing cycle, and any modifications to materials or processes tend to be capital intensive and difficult, and perhaps not the best way forward from a pure business perspective,
  2. Product specific, this one selects a particular product and analyzes the ways in which its different component materials flows can be modified and/or redirected to optimize product environment interaction. Such an analysis is particularly appropriate at the initial design stage of a product, when decisions on alternative materials or processes can often be made at a stage preceding the investment of large amounts of capital for equipment or process development, an action that often locks in a particular material or process for the long term.
Influencing Circular Economies

Much of the energy is used in industry is concentrated on very few sectors: aluminum production, cement production, iron and steel industry etc. Major reductions in energy will follow from the trend to declining materials use, since modern technologies are much less energy intensive than the processes they replace – one needs to focus more on energy efficiency to make a sustainable argument.

Many technologies for such change are already in hand; the challenge appears to lie rather in achieving satisfactory economic incentives. For example, with plastics – today recycling rate is around 30% with a promise to 60% with various initiatives, globally. The largest groups in total non-fiber plastics production are PE (36%), PP (21%), and PVC (12%), followed by PET, PUR, and PS (<10% each). Polyester, most of which is PET, accounts for 70% of all PP&A fiber production.

Together, these six groups account for 92% of all plastics ever made. Approximately 42% of all non-fiber plastics have been used for packaging, which is predominantly composed of PE, PP, and PET. The building and construction sector, which has used 69% of all PVC, is the next largest consuming sector, using 19% of all non-fiber plastics.

Given the ubiquitous nature of plastics, it becomes rather difficult to proceed much further so long as the plastics are designed into products in such a way that their extraction after use is unfeasible or causes excessive degradation of the basic polymeric material – leaving very little scope to fit in the circular economy model.

Thoughtful initial design of products, utilizing green manufacturing processes to truly bio-based materials that degrade efficiently, will be needed. Ways around this problem may come from innovative work wherein the use of tandem biotech/chemical synthesis and material science has resulted in a family of materials that are produced from renewable resources while being completely biodegradable. While these are significant in their own accord, a more dramatic innovation is necessary.

There is a need for the big ten of the plastics industry (Dow Chemical, Lyondell Basell, Exxon Mobil, Sabic, Ineos, BASF, Eni, LG Chem, Chevron Phillips, Lanxess) to design efficient ways to create plastics that can be recycled appropriately.

Constraints & Incentives for Circular Economy

Circular Economy cannot be studied and optimized in isolation from the institutions of various kinds that promote or constrain the material/energy flow, for example:

a. Engineering excellence/efficiency can often promote cyclic behavior by designing processes and promote materials reuse,

b. Green synthetic chemistry to reduce the quantity of wastes of (better) to substitute materials or components that result in less toxic wastes,

c. Extensive taxation to promote raw material flows and import-export flows that are contrary to cyclization,

d. The overall economics may make it difficult to raise capital to alter a process and render it more efficient, that is, to improve it cyclic nature,

e. Government regulations may make the reuse of materials so difficult that enhanced waste flow is de facto encouraged. Policies should provide support to entities that help minimize such waste streams,

f. The rapid rate of technological evolution and obsolescence contributes to an enhanced waste stream. Accomplishing the much-to-be-desired-ends is to chart the obsolesce of capital and consumption goods at the time of their production, by designing with focus on planned obsolescence versus built-in obsolescence of various goods,

g. Standard of living of the consumer may encourage long product use or, alternatively, may promote early product disposal,

h. Adapting Blue Economy, where the best for health and the environment is cheapest and the necessities for life are free utilizing a local system of production and consumption that works with what you have, i.e., use local buy local, eliminating multiple steps involved in the supple chains,

i. The price system, by failing to include relevant externalities in prices and costs, may preclude adoption of circular economy by manufacturers and producers. Alternatively, one could use force majeure by ensuring that all environmental costs and benefits are priced at their full social value, for example with a CO2 tag – higher the CO2 emissions should result in a higher penalty. 

Appropriate methodologies to assess circular economy parameters are vital, since environmental tradeoffs are certain to arise, just as to economic and technological tradeoffs.

A few hundred years ago, industry changed from a small, labor-intensive, unobtrusive activity to one that has become large, obtrusive, and potentially destructive to the resources that support it. Industry now has the opportunity to take a step as great as was taken in the industrial revolution of the 18th century: to move from unconstrained use and disposal of materials to manufacturing processes and approaches that make products and impacts into account in the same design and with the same degree of foresight. To conclude – at best, we as a society can achieve a quasi-circular economy since achieving a perfectly circular economy is an ideal case scenario – and frankly – ideal systems do not exist!

However, miracles do happen. They must be planned in order to occur. Similarly, in this time of global crisis, we must work out our own salvation. If we can afford to sink ships, that cost millions of dollars to construct, merely for giving target practice to the gunner, then surely we can afford to destroy other obsolete and useless products in order to give work to millions and pull the world out of the dire catastrophe in which it is now wallowing.

About the author

Dr Kapil S Lokare

Skype: kapillokare
Phone: +49 (0) 152 3623 5786

Director, E2iG; Advisory Board, Renewable Energy (Cambridge Scholars Publishers, United Kingdom)


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