Bioenergy Climate Protection and Oil Reduction/Issue29

While financial players on Wall Street are looking for investment opportunities in renewable energy industry, New York State is ramping up the effort to make rural Upstate New York a leader in the nation’s emerging “bio-economy”.

In his State-of-the-State (SoS) address and proposed budget, newly elected Governor Eliot Spitzer placed a priority on renewable energy and pledged to build on the bio-energy momentum developed during the predecessor administration of George Pataki.

Heading the Empire State ’s renewable effort will be Lieutenant Governor David A. Paterson. Before joining the Spitzer ticket last fall, Paterson was a member of the State Senate, representing much of Manhattan ’s Harlem . Spitzer’s charge to his lieutenant was clearly articulated in the SoS: “increase renewable energy production…so the state can meet its goal of obtaining 25 percent of its energy needs from renewable sources” by the year 2013.

Another important member of the Spitzer renewable team will be newly appointed State Agriculture Commissioner Patrick Hooker. As head of the New York Farm Bureau, Hooker spearheaded Albany efforts to boost the Empire State ’s bio-energy agenda.

Other key NYS renewable policy makers will include: Judith Enck, Spitzer’s Deputy Secretary for the Environment; Alexander “Pete” Grannis, the new head of the State Department of Environmental Conservation (DEC); and Steve A. Mitnick, assistant secretary for energy and telecommunications.

Enck served for eight years as Spitzer’s top environmental policy advisor in the Attorney General’s office and is the former head of Environmental Advocates of New York. As a 32-year member of the State Assembly, Grannis played a key role in enactment of legislation relating to brownfields, acid rain, clean air and water, fluorocarbons and recycling. Mitnick was a senior energy policy advisor at McKinsey & Company.

Policy-wise, Spitzer stepped up the NYS commitment to the Regional Greenhouse Gas Initiative (RGGI) by announcing plans to create a 12-person “Climate Change Office” within the DEC. The Spitzer Administration has said it also is looking to follow California ’s lead by establishing aggressive targets for reduction of vehicle carbon dioxide emissions.

In his proposed budget, the Governor continued support for the commercialization of cellulosic biomass research, which got a jump-start late last year when the announcement of $25 million in state grants to help fund construction of New York ’s first two cellulosic ethanol refineries.

One of the cellulosic biomass projects, led by Catalyst Renewables, will use willow and northern hardwoods to produce ethanol at a 130,000 gallons per year (GYP) bio-refinery to be built adjacent to the Catalyst wood-to-energy plant in Lyonsdale, north of Utica . Partners in the Catalyst effort include SUNY College of Environmental Science and Forestry (ESF), O’Brien & Gere and New Energy Capital.

The second project, which will also use woody biomass as its primary feedstock, will be a joint effort of Mascoma Corporation and Genencor. The 500,000 GPY facility will be built at the Genencor enzyme plant in Rochester . Other partners in the Mascoma-Genencor project include Cornell and Clarkson Universities , the Natural Resources Defense Council and Khosla Ventures.

In his proposed budget, Governor Spitzer also allocated funds for biofuels production tax credits which allow ethanol and bio-diesel producers to earn as much as $2.5 million a year in refundable state tax credits.

The State Legislature is also looking to up the renewable ante with proposals for tax credits and other incentives to encourage New York farmers to grow cellulosic “energy crops” like willow and switchgrass. These measures would help to capitalize on cutting edge cellulosic biomass research at Upstate NY universities such as Cornell, SUNY ESF and Clarkson.

These new initiatives will build on a host of other recently adopted state programs, including elimination of all state sales taxes on renewable fuels and a $10 million appropriation to assist privately-owned gas stations with installation of e-85 and bio-diesel pumps.

New York ’s bio-energy momentum is expected to build through the balance of 2007 with a number of bio-refineries coming on line, including the 114 million GPY Northeast Biofuels ethanol plant now under construction in a former brewery north of Syracuse .

Note: Stewart Hancock is a partner in Syracuse-based Hancock Public Affairs, which works with a number of renewable energy clients including Northeast Biofuels .

The Northeast Regional Biomass Program Encourages Bioheat
by Gretchen Reeser of CONEG Policy Research Center

The Northeast Regional Biomass Program (NRBP) believes that the Northeast could displace five percent of its petroleum heating oil with biodiesel in five years. This outcome, if achieved, could displace over 300 million gallons of imported petroleum, reduce greenhouse gases, and help to spur regional biodiesel production. The Northeast represents nearly 70 percent of the seven billion gallon heating oil market in the U.S. and has an established heating oil marketing and delivery infrastructure of nearly 7,000 heating oil dealers. As a result, the Northeast is a logical market for a blend of biodiesel and heating oil known as bioheat.

The blending of biodiesel with heating oil is a relatively new concept and faces challenges in market acceptance and market penetration. The biodiesel industry, working in tandem with the oil heat industry, has introduced the issue and educated heating oil dealers about bioheat, and also developed standards for blending, storing, and transporting the product. They have jointly introduced bioheat as a way to make heating oil “greener,” and at the same time become more energy independent by displacing imported petroleum with domestically produced biodiesel.

A number of heating oil dealers in the Northeast are blending biodiesel in heating oil in percentages ranging from 1 to 20 percent, and scores of successful demonstrations have been done with blends of biodiesel and heating oil. In addition to research and demonstrations, several states have policies to support bioheat. These steps, while critically important, are not sufficient on their own to result in region-wide adoption of bioheat, since the current market is not yet adequate to stimulate widespread investments in blending and storage facilities. Greater consumer demand for bioheat in the Northeast is needed. However, consumers are unlikely to ask for bioheat unless they are educated about the benefits of the product and are confident it is safe and reliable.

The NRBP is beginning a consumer education and outreach project for bioheat. The goal is to have an effective message and outreach initiative to inform consumers about bioheat. Involvement of both the oil heating and the biodiesel industry in the development of the consumer outreach will help ensure accurate, credible and effective information is reaching the consumer.

The NRBP is also undertaking a project to anticipate and address potential state and local laws, regulations and policies that could impede the switch to bioheat. Certain state laws, such as fire codes or transportation regulations may need to be reviewed to accommodate for the use of biodiesel. For example, a state law that currently prohibits licensed oil burner technicians from working on any heating system not operating on standardized heating oil would preclude the use of bioheat, due to the technical definitions of heating oil.

Federal Initiatives Update

Congressional Hearing Start on the Farm Bill

The Farm Security and Rural Investment Act of 2002 (P.L. 107-171), known as the 2002 Farm Bill, is up for reauthorization in 2007. Both Senate and House Agriculture Committee’s have now held hearings reviewing the President’s proposed Farm Bill. Furthermore, during the Senate Energy and Natural Resources one day conference investigating biofuels, the Farm Bill came up several times as a vehicle for the introduction of new biofuels legislation. This year will be critical in the development of the Farm Bill and other new legislation on renewable energy, stay informed on this legislation by checking out Congressional hearings found at the following links.

http://agriculture.senate.gov/

http://agriculture.house.gov/index.shtml

http://www.senate.gov/pagelayout/committees/b_three_sections_with_teasers/committee_hearings.htm

Ethical, Legal, and Societal Implications (ELSI) of Research on Alternative Bioenergy Technologies, Synthetic Genomics, or Nanotechnologies

The U.S. Department of Energy requests proposals for Ethical, Legal, and Societal Implications of Research on Alternative Bioenergy Technologies, Synthetic Genomics, or Nanotechnologies. Areas of interest include, but are not limited to: Impacts from changing land use patterns; the use of "dual-use" crops (food vs. energy); and implications resulting from the exploration and exploitation of microbes and microbial capabilities which would result from a large biomass-to-biofuels effort. $1 million expected to be available, 5-9 awards are anticipated.

Final proposals due April, 19, 2007 . For more info, contact Deborah Greenawalt at Deb.Greenawalt@science.doe.gov or go to:
https://e-center.doe.gov/iips/faopor.nsf/UNID/EF92FB6885706B4B8525724A0050672C

Changes Made to Sec. 9006 Guaranteed Loan Program

The Rural Development Agency changed the renewal fee rate for the Renewable Energy and Energy Efficiency Improvements (Sec. 9006) Guaranteed Loan Program. The new renewal fee rate is now set at one eighth of one percent.

Source: http://a257.g.akamaitech.net/7/257/2422/01jan20071800/edocket.access.gpo.gov/2007/E7-504.htm

House of Representatives Rolls Back $14 Billion in Subsidies for Big Oil

Nearly two-thirds of the House of Representatives voted in favor of the Creating Long-Term Energy Alternatives for the Nation (CLEAN) Act (HR 6). Passed on January 18, it was the last piece of legislation up for vote during the first hundred hours of the 110^th Congress. The Act will transfer around $14 billion out of large oil company subsidies and tax breaks to a ‘clean energy fund’ to help fund renewable energy and promote energy efficiency.

House Speaker, Nancy Pelosi, strongly supported the decision saying, "Today's vote represents the first step toward a future of energy independence. By rolling back $14 billion in subsidies for Big Oil at a time when they have recorded record profits, and investing that money in clean renewable energy, energy efficiency and alternative fuels, we will reduce our dependence on foreign oil.

"By investing in American ingenuity, Democrats will accelerate the implementation of existing clean, energy-efficient technologies. We will promote homegrown alternatives, creating good-paying jobs while bolstering our national security, sending our energy dollars to the Midwest, not the Middle East ."

The money is expected to help promote power generation from wind and solar, as well as create incentives for hybrid vehicles and energy-efficient buildings and equipment.

Source: http://www.allheadlinenews.com/articles/7006189616 and http://www.renewableenergyaccess.com/rea/news/story?id=47171

New Fe deral Legislation

In recent months a number of new bills were introduced to combat high energy costs. These bills include provisions to increase biofuels production, require the production of flex-fuel vehicles, extends the renewable energy tax credits and a variety of other initiatives. See the list below for a brief description of these important bills. To find out the specifics of each bill use the following link to search by each bill number. http://thomas.loc.gov/

S.6 – National Energy and Environmental Security Act of 2007

On January 4, Senators Reid (D-NV), Bingaman (D-NM), Boxer (D-CA), Schumer (D-NY), Lieberman (D-CT), Cantwell (D-WA), Leahy (D-VT), Lautenberg (D-NJ), Stabenow (D-MI), Salazar (D-CO), Menendez (D-NJ), and Webb (D-VA) introduced the National Energy and Environmental Security Act of 2007. S. 6 is a “Sense of Congress” bill which seeks to decrease United States dependence on foreign oil as well as to find sustainable energy sources to reduce global warming by calling for Congress to pass legislation that would require reductions in GHG, eliminate tax giveaways to large energy companies, etc. The bill has been referred to the Senate Committee on Finance. Other cosponsors include Senators Akaka (D-HI) and Brown (D-OH).

H.R. 6 – CLEAN Energy Act of 2007

On January 12, Rep. Rahall (D-WV) along with 198 other Representatives introduced the Creating Long-Term Energy Alternatives for the Nation Act of 2007 or CLEAN Energy Act of 2007 to reduce our Nation's dependency on foreign oil by investing in clean, renewable, and alternative energy resources, promoting new emerging energy technologies, developing greater efficiency, and creating a Strategic Energy Efficiency and Renewables Reserve to invest in alternative energy. For more information on this Act see “House of Representatives Rolls Back $14 Billion in Subsidies for Big Oil” in this issue of BCO.

S.23/H.R.559 – Biofuels Security Act of 2007

On January 4^th, 2007 Senators Harkin (D-IA), Lugar (R-IN), Dorgan (D-ND), and Obama (D-IL) introduced the Biofuels Security Act of 2007 to decrease American dependence on foreign oil through increasing national use of renewable fuels. The bill requires that by 2017 all vehicles have flexible fuel engines and half of all gas stations dispense E85. New targets are also set for the amount of renewable fuels used, with a goal of 30 billion gallons by 2020 and 60 billion gallons by 2030. The bill was later introduced in the House by Representatives Delahunt (D-MA), Herseth (D-SD) and Inslee (D-WA) as H.R.559 on January 18, 2007 .

S.133 – American Fuels Act of 2007

On January 4, Senators Obama (D-IL), Lugar (R-IN), and Harkin (D-IA) introduced the American Fuels Act of 2007 to reduce United States dependence on foreign oil, thereby increasing national security and improving the economy. The bill sets various goals for alternative fuel production within the next ten years, particularly for cellulosic ethanol. The bill also provides for a 2 billion gallon carve-out for alternative diesel fuel; tax incentives for FFV manufacturing; a 35 cent per gallon tax credit for E85 fuel; and public access to government alternative fueling stations.

S.146 – Government Fleet Fuel Economy Act of 2007

On January 4, Senator Boxer (D-CA) introduced the Government Fleet Fuel Economy Act of 2007 to set new fuel efficiency requirements for federal automobiles.

S.162 – National Fuels Initiative Act of 2007

On January 4, Senator Lugar (R-IN) introduced the National Fuels Initiative to change the alcohol and alternative fuels credits by amending the Internal Revenue Code of 1986. National Fuels Initiative promotes diversifying US transportation fuel and keeping alternative fuels competitive with oil prices. Besides this, the bill seeks to increase infrastructure for alternative fuels by promoting the installation of E85 fuel pumps and encouraging the manufacture of Flexible Fuel Vehicles (FFVs). The bill also incorporates parts of Senators Lugar and Obama’s (D-IL) previously introduced Fuel Economy Reform Act calling for a 4 percent increase in Corporate Average Fuel Economy standards.

S.167/H.R.395 – Cellulosic Ethanol Development and Implementation Act of 2007

On January 4, Senator Boxer (D-CA) introduced the Cellulosic Ethanol Development Implementation Act of 2007 which provides $1 billion for cellulosic ethanol development over the next six years. The bill also amends the Clean Air Act to provide $400 million annually for fiscal years 2007 through 2010 for the cellulosic biomass ethanol conversion assistance program. The House companion bill was introduced by Rep. Salazar (D-CO) on January 10 as H.R.395. Cosponsors include Representatives Bishop (D-NY), Hare (D-IL), Marshall (D-GA), McIntyre (D-NC), Costa (D-CA), Jackson-Lee (D-TX), McHugh (R-NY), and Scott (D-GA).

S.183 – Improved Passenger Automobile Fuel Economy Act of 2007

On January 4, Senator Stevens (R-AK) introduced the Improved Passenger Automobile Fuel Economy Act of 2007 to increase the fuel economy standard to 40 miles per gallon by 2017 using various methods including market-based strategies. Senator Murkowski (R-AK) is a cosponsor.

H.R.76 - To amend the Internal Revenue Code of 1986 to increase the number of vehicles for which the alternative motor vehicle credit is allowed.

On January 4, Rep. Bartlett (R-MD) introduced bill H.R. 76 to extend the alternative motor vehicle credit from 60,000 to 250,000 vehicles.

H.R.80 - To provide for Federal research, development, demonstration, and commercial application activities to enable the development of farms that are net producers of both food and energy.

On January 4, Rep. Bartlett (R-MD) introduced bill H.R.80 to reduce energy input into agriculture production through research, development, demonstration, and commercial application activities to enable the development of farms that are net producers of both food and energy. This act sets up revolving loans and loan guarantees under DOE for the establishment of these farms or groups of farms.

H.R.85 – Energy Technology Act of 2007

On January 4, Rep. Biggert (R-IL) introduced the Energy Technology Act to provide for the establishment and funding of centers to encourage information exchange for advanced energy technologies.

H.R.86 – Oil and Gas-to-Alternatives Swap (OGAS) Act of 2007

On January 4, Representatives Bigger (R-IL), Ehlers (R-MI), Johnson (R-IL) and Kirk (R-IL) introduced the Oil and Gas-to-Alternatives Swap (OGAS) Act of 2007 to extend the incentives for alternative fuel vehicles and fueling stations as well as to remove the oil and gas production incentives from the Energy Policy Act of 2005. Rep. LoBiondo (R-NJ) is an additional cosponsor.

H.R.196 – Renewable Fuels and Energy Independence Promotion Act of 2007

On January 4, Representatives Pomeroy (D-ND) and Hulshof (R-MO) introduced the Renewable Fuels and Energy Independence Promotion Act of 2007 to make the excise tax credits for alcohol fuels and biodiesel permanent. The bill would also amend the Harmonized Tariff Schedule of the United States to make the effective date of the ethyl alcohol and ethanol tariff duties that of the effective date of the Act. Additional cosponsors include Representatives Herseth (D-SD), Lewis (R-KY), Peterson (D-MN), Salazar (D-CO), Moore (D-KS), Ross (D-AR) and Shimkus (R-IL).

H.R.197 – To amend the Internal Revenue Code of 1986 to provide a 5-year extension of the credit for electricity produced from certain renewable resources.

On January 4, Representatives Pomeroy (D-ND), Ramstad (R-MN), Udall (D-CO) and Wamp (R-TN) introduced H.R.197 to extend the Renewable Energy Production Tax Credit from 2009 to 2014. There are currently 50 cosponsors.

H.R.349 – 10 by 10 Act

On January 9, Representative Kline (R-MN) introduced the 10 by 10 Act, which would amend the Clean Air Act to require that all gasoline contain a 10 percent blend of renewable fuel by the year 2010.

S.298 - Renewable Energy, Fuel Reduction, and Economic Stabilization and Enhancement Act of 2007 (REFRESH)

On January 12, Senators Murkowski (R-AK) and Stevens (R-AK) introduced the Renewable Energy, Fuel Reduction, and Economic Stabilization and Enhancement Act of 2007 (REFRESH) to provide renewable energy incentives for geothermal power, ocean energy and plug-in hybrid electric vehicles. It also expands the Production Tax Credit to include Wave, Current, Tidal, and Ocean Thermal Energy. The bill also seeks to adjust fuel efficiency standards.

S.309 – Global Warming Pollution Reduction Act

On January 16, Senators Sanders (I-VT), Boxer (D-CA), Kennedy (D-MA), Menendez (D-NJ), Lautenberg (D-NJ), Leahy (D-VT), Reed (D-RI), Akaka (D-HI), Inouye (D-HI), Feingold (D-WI), and Whitehouse (D-RI) introduced the Global Warming Pollution Reduction Act in order to amend the Clean Air Act to further reduce carbon dioxide emissions. Directs the Environmental Protection Agency (EPA) to: (1) set milestones to reduce the aggregate net levels of emissions (authorizes EPA to establish market-based programs to achieve such reductions); (2) require each fleet of automobiles sold by a manufacturer beginning in model year 2016 to meet emission standards; (3) contract with the National Academy of Sciences to study the potential contribution of the non-highway portion of the transportation sector towards meeting the emission reduction goal; (4) require that electric generation units meet an emission standard that is not higher than the emission rate of a new combined cycle natural gas generating unit; and (5) establish a low-carbon generation trading program. Senator Dodd (D-CT) is also a cosponsor.

S.317 – Electric Utility Cap and Trade Act of 2007

On January 17, Senators Feinstein (D-CA) and Carper (D-DE) introduced the Electric Utility Cap and Trade Act of 2007 to create a regulatory program for the emission of greenhouse gasses by electric utilities. According to the floor statement of Senator Feinstein the bill is currently supported by six major energy companies whose total energy production equals 150,000 megawatts.

H.R.517 – Independence from Oil with Agriculture Act of 2007

On January 17, Rep. Davis (R-VA) introduced the Independence from Oil with Agriculture Act of 2007 to amend the Internal Revenue Code to make certain renewable fuel tax credits permanent, such as alcohol fuels or mixtures, biodiesel fuels or mixtures and wind and biomass in the Production Tax Credit. The bill also seeks to amend the Clean Air Act to increase the required amount of renewable fuel for the years 2008-2012 to 12 billion gallons by 2012, and to calculate required levels of renewable fuel for 2013 onwards based on those levels.

H.R.547 – Advanced Fuels Infrastructure Research and Development Act

On January 18, Rep. Gordon (D-TN) introduced the Advanced Fuels Infrastructure and Development Act to assist in developing markets for alternative fuels through increased infrastructure as well as to enforce and promote the use of Ultra-Low Sulfur Diesel. The House passed this bill, 400 – 3, on February 8.

H.R.589 – Get Real Incentives to Drive Plug-in Act

On January 19, Representatives Inslee (D-WA), Delahunt (D-MA), Hall (R-TX), Cleaver (D-MO), Honda (D-CA), Kaptur (D-OH), Hinchey (D-NY), Gilchrest (R-MD), Klein (D-FL) and Grijalva (D-AZ) introduced the Get Real Incentives to Drive Plug-in Act to promote the use and development of plug-in hybrid electric vehicles through authorizing $500 million over the next four years. Additional cosponsors include Representatives Dogget (D-TX), Lantos (D-CA), Schiff (D-CA), Renzi (R-AZ), and Serrano (D-NY).

S.357 Ten-in-Ten Fuel Economy Act

On January 22, 2007 Senators Feinstein (D-CA), Snowe (R-ME), Inouye (D-HI), Durbin (D-IL), Kerry (D-MA), Boxer (D-CA), Nelson (D-FL), Cantwell (D-WA), Lautenberg (D-NJ), Lieberman (D-CT), Menendez (D-NJ) and Collins (R-ME) introduced the Ten-in-Ten Fuel Economy Act to reduce greenhouse gas emissions and dependence on foreign oil by increasing fuel economy standards and measures. Cosponsors include Senators Leahy (D-VT), Reed (D-RI), Dodd (D-CT), and Sanders (I-VT).

H.R.604 – E-85 Investment Act of 2007

On January 22, Rep. Hayes (R-NC) introduced the E-85 Investment Act of 2007 to increase the rate of such credit for property to 75 percent; to reduce the maximum dollar amount of such credit in 2013 and 2014 for ethanol-related refueling property; and to extend such credit through 2016 for ethanol-related refueling property.

H.R.620 – Climate Stewardship Act of 2007

On January 22, 2007 Representatives Olver (D-MA), Gilchrest (R-MD), Inslee (D-WA), Walsh (R-NY), Cummings (D-MD), Kirk (R-IL), Solis (D-CA), Castle (R-DE), Hinchey (D-NY), Shays (R-CT), Harman (D-CA), Saxton (R-NJ), Dicks (D-WA), McCollum (D-MN), DeGette (D-CO), Thompson (D-CA), Cardoza (D-CA) and Hare (D-IL) introduced the Climate Stewardship Act of 2007 to accelerate the reduction of greenhouse gas (GHG) emissions by creating a market-driven system of tradable GHG allowances. H.R.620 has 69 cosponsors.

State Legislative Updates

Gov. Schwarzenegger Proposes California Low Carbon Fuel Standard

On January 9, Governor Schwarzenegger announced a Low Carbon Fuel Standard (LCFS) for California . The standard expects to yield a 10 percent decrease in carbon emissions from transportation fuels by 2020. Pacific Gas and Electric was in favor of the proposal, saying “PG&E applauds the Governor's new Low Carbon Fuel Standard and his bold leadership in addressing alternative fuels as a way to lead the nation to a climate friendly future. We are committed to doing our part and have seen first hand the significant benefits of alternative fuels on reducing carbon intensity.” The LCFS promotes the use of ethanol and hybrid vehicles as two currently developed means of attaining this goal, but leaves the strategy decisions to industry. The University of California estimates that the CA emissions goals can increase Gross State Product by about $60 billion and create over 20,000 new jobs.

Sources: http://gov.ca.gov/index.php?/press-release/5074/ and http://biz.yahoo.com/prnews/070109/sftu124.html?.v=61

New York Power Authority Tests Biofu el at Facility

The New York Power Authority (NYPA) conducted a two-day test in late October, 2006 to see the effects of a varying blend of conventional heating fuel mixed with soybean biofuel (5-20 percent) in the production of electricity. The study was conducted in Queens at the Charles Poletti Power Project by the Power Authority and Electric Power Research Institute (EPRI). Initial results showed increased efficiency and lower emissions. NYPA President Timothy Carey said, “The Biofuel testing at our Poletti project in Queens is a pioneering development with great potential significance for the electric power industry, energy security and the environment. To the best of our knowledge, it is the first application at a large power plant, and the largest use of biofuels on any single occasion in the US .”

Source: http://www.electricnet.com/content/news/article.asp?DocID=%7BE8A23C71-3B0B-4145-A2B6-52E1DADE3C74%7D&Bucket=Current+Headlines&VNETCOOKIE=NO

Indiana Governor Happy with Biofuel Development

Indiana Governor Mitch Daniels’ “State of the State” address on January 16, 2007 had positive things to say regarding Indiana ’s growing ethanol industry. “With our new tax credit program plus a lot of hustle, we have gone from nowhere to national leadership in the promising sector of renewable fuels. In just 18 months, we have grown from one ethanol plant producing 100 million gallons per year to 21 biofuels plants soon to generate 1.7 billion gallons annually,” said Daniels.

Though no new renewable fuel targets were given during the address, Lt. Governor Becky Skillman later said that cellulosic ethanol may be a future focal point for research and development as well as General Assembly legislation.

Source: http://www.in.gov/gov/

Recent Studies

NBB and NREL Study Found 1/3 of U.S. Biodiesel Samples Out-of-Spec

The National Biodiesel Board (NBB) and the National Renewable Energy Laboratory (NREL) co-funded a national fuel quality project that found that 33 percent of biodiesel samples taken between November 2005 and July of 2006 were out of spec for incomplete processing. “NBB views these results as unacceptable,” Jobe, CEO of NBB, said. “This underscores the need for enforcement agencies to take action against those who aren’t producing biodiesel that meets the existing standard, ASTM D-6751.”

The NBB board approved a comprehensive Fuel Quality Policy in June 2006 where by NBB will work with state and federal agencies to regulate fuel and enforce quality. “All of the samples from the state’s biodiesel producers and terminals that we have collected and tested have met specifications,” stated Mark Buccelli, director of Minnesota Department of Commerce Division of Weights and Measures. “We have set up a monthly schedule to collect samples at the biodiesel producers and terminals. We expect to see good results. Most of the terminals are testing every shipment of biodiesel that comes into their facilities.”

Source: http://oilspot2.dtnenergy.com/e_article000692547.cfm

Mixed Native Grasses a Good Source of Biofuel

A recent study by the University of Minnesota published in the journal Science shows that biofuel made from mixed native prairie grass could provide more energy than ethanol from corn or a single grass species such as a switchgrass monoculture.

The research found that areas with a diverse species of grasses are not only more productive in terms of biomass, but can also help remove carbon dioxide from the atmosphere. “This is what really surprised us,” said Dr. David Tilman, a professor at the University of Minnesota who conducted the study. “There is more carbon stored year after year in the soil than the total amount of fossil carbon that is produced into the atmosphere.” An acre of prairie grass grown for several years removes around 1,750 pounds of carbon dioxide from the atmosphere while releasing only 400 pounds of carbon dioxide through planting, harvesting and transportation.

For the moment some obstacles remain. Tilman said one problem is that transporting the grass more than 50 miles for processing would not be practical. Lastly, Dr. Burton English of the University of Tennessee said current biorefinery methods may also be a drawback. “It depends on the conversion technology,” Burton said. “If you’re doing a fermentation system, then you may have some difficulties. You may have a less efficient plant when you take multiple feedstocks versus a single monoculture feedstock.”

Sources: http://www.argusleader.com/apps/pbcs.dll/article?AID=/20070101/NEWS02/701010311/1001/NEWS

Tilman, David; Hill, Jason; Lehman, Clarence. “Carbon-Negative Biofuels from Low-Input High-Diversity Grassland Biomass.” Science. V.314, p.1598-1600. 8 Dec 2006 .

Governor’s Ethanol Coalition Publishes Two Reports

The Governor’s Ethanol Coalition (GEC) published two reports in December. The first was a study from the University of Tennessee commissioned by GEC to analyze the possible future economic and environmental effects of attaining 60 billion gallons of ethanol by 2030. Titled Economic and Agricultural Impacts of Ethanol and Biodiesel Expansion, the study found that not only is the concept feasible, but biofuels have the potential to create $368 billion of economic activity annually by 2030, and they could have a smaller impact on the livestock industry than formerly anticipated.

Based on these findings, GEC issued their own suggestions called Ethanol From Biomass: How to Get to a Biofuels Future – Recommendations. Some of the key ideas include moving forward an ethanol consumption target of 12 billion gallons to 2010, creating a schedule for expanding ethanol infrastructure, and also changing the Volumetric Ethanol Excise Tax Credit (VEETC) a Cellulosic Ethanol Production Tax Credit valued 1.5 times higher.

Sources:

http://www.ethanol-gec.org/information/biomasstoethanol2006.htm

http://www.ethanol-gec.org/information/Ethanolfrombiomass12-2006.pdf

http://www.ethanol-gec.org/information/Ethanolagimpacts.pdf

BIO Releases Report to Support Biofuel Industry

On November 21, 2006, the Biotechnology Industry Organization (BIO) released a report, Achieving Sustainable Production of Agricultural Biomass for Biorefinery Feedstock. The report primarily deals with the question “Can American farmers feed the growing biofuel industry?” The report offers guidelines and incentives to encourage farmers to produce and bring more feedstocks to biorefineries in an economically and environmentally sustainable way.

James Hettenhaus, the author of the report, said, “For the biofuel industry to expand, biorefinery operators must be confident that the supply chain for cellulosic feedstocks is robust, and farmers must be assured that they will benefit by adopting sustainable harvesting practices. As the biorefinery industry creates markets for crop residues, farmers will be more motivated to adopt practices that allow them to collect these residues while maintaining soil quality and controlling erosion. Recent successes have spurred an increase in adoption of no-till cultivation, but improved information is needed to convince farmers of the benefits.”

Source: http://www.bio.org/news/newsitem.asp?id=2006_1121_01

News Briefs

Case IH to Support Biodiesel

On November 16, 2006 , Case IH announced its support for B20 in most Case IH engines and B5 in all Case IH engines. Moreover, Case IH uses biodiesel blends for its factory fills.

“One hundred percent factory fill of a biodiesel blend is a logical next step in the process of embracing biodiesel,” said Randy Baker, president of Case IH in North America . “Adding to demand for soybeans while producing the crop is the type of strategy our customers like to pursue.” Baker goes on to say, “As long as engine maintenance procedures are followed, and in-spec blends are purchased from a reputable supplier, biodiesel blends from B5 through B20 can be used in any Case IH engine in operation today. “In addition, Case IH and our engine partner companies are continuously testing new and higher biodiesel blends and engine configurations to provide our customers with the most up to date information.”

B5 is supported by all major original equipment manufacturers (OEMs), provided it is made with biodiesel meeting ASTM D 6751. Many OEMs are recommending the use of BQ-9000 companies. BQ-9000 is the industry’s biodiesel fuel quality program.

Source: http://nbb.grassroots.com/07Releases/CaseIH/

First Distribution Center for Biofuels to be Built in Manly, Iowa

The first biofuels trading and distribution center, Manly Terminal LLC, in Manly, Iowa will start servicing the regional ethanol market in April 2007. Plans for construction of the facility were announced last July. The 100-acre facility will have more than 20 million gallons of liquid storage capacity. The location of the facility is very convenient -- very close to U.S. Highway 65 and Iowa Highway 9 and is eight miles from Interstate 35 and 15 miles from Interstate 90. Moreover, there are about 14 plants within a hundred miles of the proposed facility, with more than 75 plants in operation within 275 miles, representing 5.1 billion gallons or half of the estimated nationwide production capacity by 2009. Manly Terminal LLC will provide a common delivery point for ethanol trading and truck and railroad distribution throughout North America .

“This facility will allow our area ethanol plants and other biofuel producers to better broker and transport their product while bringing strong development, commerce, and jobs to northern Iowa and southern Minnesota ,” said Lee Kiewiet, president of Manly Terminal. “We’re excited to see this project move forward and very pleased that we’ve found such a perfect home in Manly and northern Iowa . We hope this will also serve as a catalyst to the area’s economy, and we foresee hundreds of new biofuels industry and transportation jobs created, both directly and indirectly with Manly Terminal.”

Source: http://www.albertleatribune.com/articles/2006/11/28/news/news4.txt

LLC Announces Innovation in Production of 1,3 Propanediol

On November 27, 2006 , DuPont Tate & Lyle BioProducts, LLC, announced it has become the first manufacturer of 1, 3 propanediol as a bio-based product. The production takes place at its $100 million facility in Loudon , Tennessee by using an innovative proprietary fermentation and purification process. 1,3 propanediol is made from corn sugar and will used to replace glycol, a petroleum-based product, in various polymer materials. Moreover, 1,3 propanediol is a major ingredient in a great number of household and personal care products such as cosmetics and detergents.

Source: http://onlinepressroom.net/DuPont/NewsReleases/

Vermont Electric Cooperative Farm Joins CVPS Cow Power

A farm outside Central Vermont Public Service’s territory has joined the CVPS Cow Power program, the nation’s first farm-to-customer renewable energy choice program. The Richmond farm, Vermont Electric Cooperative (VEC), is going to be the first non-CV farm that has a contract with the CVPS Cow Power program. According to David Hallquist, VEC Chief Executive Officer, this joint arrangement will be beneficial to all of VEC’s members and the environment.

CVPS is the first manure-based renewable energy program in the country that brings together consumers and farmers. CVPS customers can choose between receiving all, half or a quarter of their electrical energy through Cow Power. All VEC members receive the market price for the energy sold to VEC, which is mutually beneficial to both VEC’s members and the environment.

Source: http://www.econline.com/content/news/article.asp?DocID={D693E10A-75DA-4F3C-8B5A-792AF6F78AB4}&Bucket=&Featured=&VNETCOOKIE=NO

Syngenta and Diversa: New Partners in Enzyme Research

On January 8 Syngenta and Diversa, two leading research and development firms, revealed plans to team their research in a quest for more economical conversion of cellulosic biomass to sugar, a fundamental part of creating biofuel through fermentation.

The pairing of the two brings Swiss-based Syngenta’s established, agri-business innovation together with San Diego ’s Diversa and its cutting edge enzyme technology.

David Jones, an executive at Syngenta, said “We are pleased to have reached this agreement with Diversa. Diversa has the best inventive capability for truly novel enzymes, and Syngenta has demonstrated its ability to express enzymes cost-effectively in plants.”

Edward Shonsey, Diversa’s Chief Executive Officer, also expressed his approval. “We are pleased with the refocus of our collaboration with Syngenta, a world leading agri-business. This agreement creates a highly-focused collaboration to move further into the Biofuel market through plant expression in a complementary manner. In addition, this agreement frees Diversa to pursue attractive opportunities for integrated commercialization of biofuels, particularly from celluslosic biomass. We look forward to sharing further news of our independent initiatives in this area in the near future.”

Sources: http://www.renewableenergyaccess.com/rea/news/story?id=47065

http://www.seedquest.com/News/releases/2007/january/18020.htm

Winter Wood Pellet Shortage

Wood pellets are an increasingly popular fuel for heating homes. Low maintenance, coupled with low prices in the past, have contributed to its growing demand. This year signals a change as customers in Reno and Northern California face long waits and rising prices. Producers in the industry blame the shortage on a lack of sawdust created by the slump in new home building. Increased demand for wood pellet stoves due to high conventional energy costs is also deemed a factor in the shortage.

Sources: http://news.rgj.com/apps/pbcs.dll/article?AID=2007701100429

http://www.kolotv.com/home/headlines/5123836.html

BioKing Announces New Canadian Biodiesel Equipment Plant

The Dutch company BioKing announced its intentions to build a high-quality biodiesel equipment manufacturing plant in Lethbridge , Canada . BioKing owns and operates one production facility in the Netherlands , but growing US, Canadian and Asian demand has inspired this latest venture. The plant is expected to produce 20 to 25 biodiesel processing units per week and employ 50 workers.

BioKing President and CEO Van de Ven said, “Biodiesel is a major growth area for us, and we are aiming to become the world's leading biodiesel equipment manufacturer. When we talk about aiming to be the leader in the field, we're not just talking about production volumes, but also about being the technology leader as well. We aim to secure this position by investing heavily in R&D on biofuels to develop technologies that will enable us to further extend the range of raw materials that we can use.”

Source: http://www.themanufacturer.com/us/detail.html?contents_id=5027

Emerald Renewable Energy to Create New US Ethanol Plants

Emerald Renewable Energy LLC, a Cargill subsidiary, plans to construct four new corn ethanol plants in the Midwest . The new plants will each use an estimated 40 million bushels of corn to produce 100 million gallons of ethanol annually and over 300,000 tons of dried distillers grains for animal feed each year. Greenfield locations, as well as co-locations with Cargill grain elevators and other utility infrastructure providers, are being considered for the four new plants. The plants are expected to create about 40 jobs per location.

“Emerald Renewable Energy will have access to Cargill’s world-class expertise in trading, sourcing corn, plant construction and operations, risk management and bulk commodity transportation,” said Cargill Corporate Vice President Scott Portnoy. Agreements with a contractor have already been made and financing arrangements will come from BNP Paribas, Santander Investment and Standard Chartered.

Source: http://www.cargill.com/news/news_releases/current_year.htm

University of Idaho and Eco-Energy to Develop New Oilseed

Eco-Energy, an international company based in Gibraltar, formally joined forces with the University of Idaho in November, 2006. The partnership plans to provide $2 million over five years to the University’s well-established plant breeding program. The aim of this collaboration is to produce a new, high-value, oilseed variety with the potential to grow in many climates. The University of Idaho has had a long interest in biofuel with a nearly 30 year old national biodiesel program still in operation.

One oilseed crop that is being researched by the University is Pacific Gold, a spicy Oriental condiment mustard that is grown by potato producers as a biofumigant by plowing green plants into the soil to combat nematodes.

Source: http://www.aocs.org/news/story.asp?id=338

EERC to Demonstrate Biomass Power Generator

The Energy and Environmental Research Center (EERC), part of the University of North Dakota, plans to demonstrate a biomass gasification power generator in the coming weeks at the Grand Forks Truss Plant in Grand Forks , North Dakota . The process will use saw dust and wood waste to produce combustible gas heat and electricity. The system is designed to work with existing power requirements of various manufacturing industries, generating between 10 kilowatts (kW) to 1 megawatt (MW) of power.

Grand Forks Truss Plant operator Shaun Johnson said, "We are very excited and proud to host a project involving renewable energy. We have a vast supply of biomass waste and continue to produce more than we can utilize in our current heating system."

Sources: http://www.renewableenergyaccess.com/rea/news/story?id=47025

http://www.eerc.und.nodak.edu/newsroom/newsitem.asp?id=277

Proposed Study for BioTown Sewage Digester

Officials in BioTown , Indiana , also known as Reynolds, cast votes of approval for a new feasibility study of an anaerobic digester for sewage. Jon Borgers, an engineer for Wessler and Associates who is working on the project, said “For right now, we’re just going to be getting into the basics of what the wastewater treatment plant is going to be, figuring out what sizes we’re talking about.” Neighboring towns are already looking into the possibilities of shipping their raw sewage for treatment. The proposed plan would run the digester from the heat produced by the gasifier and ultimately create an energy production system.

Sources: http://www.thehj.com/main.asp?SectionID=9&SubSectionID=32&ArticleID=19217&TM=21919.39

http://www.thehj.com/main.asp?SectionID=9&SubSectionID=32&ArticleID=19282&TM=22302.37

Montana High School to Use Biomass Heating

The brand new 1,200-student Glacier High School , located in Flathead Montana, fired up its new biomass heating system on January 1. Set to open in fall 2007, the school’s biomass boiler, which will run on woodchips gathered from nearby forest-fire reduction sites, is estimated to pay for itself in energysavings within the first year as well as provide additional energy cost savings close to $1.5 million during the next 10 years.

Source: http://www.dailyinterlake.com/articles/2007/01/06/news/news03.txt

88^th Annual American Farm Bureau Conference

The 88^th annual American Farm Bureau Conference was held in Salt Lake City , Utah from January 7-10, 2007 . Speakers included the president of the American Farm Bureau, Bob Stallman; US Secretary of Agriculture, Mike Johanns; U.S. House Agriculture Chairman Collin Peterson (D-Minn.); and USDA Chief Economist Keith Collins. The conference addressed a broad variety of topics but had a strong focus on renewable energy.

Stallman opened the conference, saying that renewable energy is “a positive aspect of agriculture that will not only increase demand for our products but reduce dependency on foreign oil.”

Peterson also discussed the implications of ethanol. "To get to where I think we need to be to produce 50 percent of our energy in rural America , we can't do it with just corn. We will run into the wall at some point," Peterson said. "The future is in cellulosic ethanol."

From the farm bill side, Johanns mentioned ethanol favorably. “Never before have we had this kind of opportunity to allow farmers to work for themselves -- for a profit -- instead of for the government,” Johanns said. “Ethanol, biodiesel, and other renewable fuels are being introduced in dramatically larger quantities and the demand has never been greater. Our Farm Bill proposals will look to the future and try to anticipate the next steps in this industry and what we can do to make sure those steps can be taken with a sure foot.”

Source: http://www.capitalpress.info/main.asp?SectionID=67&SubSectionID=792&ArticleID=29778&TM=49314.77

http://www.agweb.com/get_article.aspx?pageid=133681&src=agcmt

http://www.thepigsite.com/swinenews/13087/mike-johanns-speaks-to-american-farm-bureau-federation

Middlebury College to Become Carbon Neutral

Middlebury College , propelled by student activists, announced plans to become carbon neutral by 2012. Using research presented by the students, the college agreed to invest $11 million in renewable energy. Plans include a biomass power plant to be fueled by wood chips, grass pellets and self-sustaining willow forests. Estimates on the amount of biomass that will be needed to run the plant range from 20,000 to 21,000 tons per year.

Sources: http://abcnews.go.com/Technology/GlobalWarming/story?id=2805553&page=1

http://www.middlebury.edu/about/pubaff/news_releases/2006/news632951384540792349.htm

Dynamotive to Produce New Intermediate BioOil

Dynamotive Energy Systems Corporation, headquartered in Vancouver Canada , an international energy solutions business, developed a new, high energy, biofuel for the intermediate and heavy fuel oil market. The company uses pyrolysis to produce its brand name BioOil, which it then mixes with 20 percent char to create the higher energy Intermediate BioOil. Commercial production is hoped to begin this spring when Dynamotive’s new facility in Guelph , Canada is set to be completed. The plant is estimated to have a 200 ton per day capacity.

Intermediate BioOil has also received Canada’s EcoLogo certification as an environmental fuel and has been developed to compete with commonly used industrial fuels such as No. 2 and No. 6 heating oil both ‘functionally and on price-performance’.

Dynamotive President and CEO Andrew Kingston said, “This new product and the EcoLogo certification are important developments in Dynamotive’s drive to offer competitively priced, environmentally friendly, renewable fuel alternatives for conventional fuel and heating oils, as well as an economical feedstock for conversion into synthetic fuels, including syn-diesel.”

Source: http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news_view&newsId=20070116005559&newsLang=en

Lumber Company to Build Biomass Energy Plant

Rough & Ready Lumber Company, located in Oregon , has plans to build a $5 million biomass energy plant to run on logging debris. Rough & Ready hopes to produce around 1.5 megawatts of electricity with the new plant, set to open in the fall. The facility was finally considered economically feasible after Congress recently reauthorized a federal energy production tax credit for biomass.

Other lumber companies have also followed suit, two in Oregon and one in Arizona . The U.S. Forest Service in Arizona has been searching for ways to thin forests that are at high risk of fire. Having a demand for forest debris increases the incentive. A market such as biomass energy from the waste wood is estimated to save up to $400 an acre on fire reduction cost.

Source: http://www.washingtonpost.com/wp-dyn/content/article/2007/01/20/AR2007012000570.html?referrer=emailarticle

Upcoming Events

Calendar

Event	Date	Location	Further Information
National Ethanol Conference	February 19 - 22, 2007	Tuscon , AZ	Info: http://www.ethanolrfa.org/industry/conference/ Source: http://www.brdisolutions.com/default.aspx
Alternative Energy NOW	February 21 - 23, 2007	Lake Buena Vista , FL	Info: http://www.upcomingevents.ctc.com/AlternativeEnergyNow-Agenda.htm Source: http://www.brdisolutions.com/default.aspx
2020 VISION PANEL DISCUSSION Bioenergy and Agriculture IFPRI	Feb. 27, 2007 3-5pm	fourth floor conference, 2033 K Street, NW	http://www.ifpri.org/events/seminars/2007/20070227Bioenergy.asp
Ethanol and Biodiesel Supply Summit	Feb. 28 – Mar. 2, 2007	Washington , DC	http://www.opisnet.com/supply/index.html Source:http://www.renewableenergyaccess.com/rea/events/home
USDA Announces 83^rd Annual Outlook Forum	Mar. 1-2, 2007	Arlington , VA	http://www.usda.gov/oce/forum Source:http://www.renewableenergyaccess.com/rea/events/home
POWER-GEN Renewable Energy and Fuels	March 6 - 9, 2007	Las Vegas , NV	Info: http://pgre06.events.pennnet.com/fl/index.cfm Source: http://www.brdisolutions.com/default.aspx
World Biofuels Markets	Mar. 6-9, 2007	Brussels Expo Centre , Belgium	http://www.WorldBiofuelsMarkets.com Source:http://www.renewableenergyaccess.com/rea/events/home
Biomass and Biorefinery Deals 2007	Mar. 26-28, 2007	Washington , DC	www.infocastinc.com/biomass07.html Source:http://www.renewableenergyaccess.com/rea/events/home
Biofuels Markets Americas	Apr. 3-4, 2007	Rio de Janeiro , Brazil	http://www.greenpowerconferences.com Source:http://www.renewableenergyaccess.com/rea/events/home
Ethanol and Biodiesel Management	Apr. 11-13, 2007	Chicago , IL	http://www.opisnet.com/ethbiomgmt/index.html Source:http://www.renewableenergyaccess.com/rea/events/home
15^th European Biomass Conference and Exhibition	May 7-11, 2007	Berlin , Germany	http://www.conference-biomass.com Source:http://www.renewableenergyaccess.com/rea/events/home
Biomass ’07: Power, Fuels, and Chemicals Workshop	May 15-16, 2007	Grand Forks , ND	http://www.undeerc.org/biomass07 http://www.undeerc.org/biomass07 Source:http://www.renewableenergyaccess.com/rea/events/home
All-Energy 2007	May 23 - 25, 2007	Aberdeen , UK	Info: http://www.all-energy.co.uk/ Source: http://www.brdisolutions.com/default.aspx

Writers: Jetta L. Wong and

Editor: Carol Werner

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The Environmental and Energy Study Institute (EESI) is a non-profit organization that works at the nexus of policy and innovation to promote environmentally sustainable societies. EESI was founded in 1984 by a bipartisan group of Congressional Members dedicated to finding environmental and energy solutions. EESI provides credible, timely information and innovative policy ideas through coalition building, media outreach, publications, briefings, workshops and task forces on the issues of energy efficiency and renewable energy, transportation, smart growth, agriculture and global climate change. Carol Werner leads the EESI team as executive director.

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