Interesting timing, especially when some biomass companies are switching from wood chips to corn, because they couldn’t turn a profit on wood chips. Looks like all the wheels are coming off the bus now.
To Survive, Some Biofuels Companies Give Up on Biofuels – Technology Review
Gevo, a prominent advanced-biofuels company that has received millions in U.S. government funding to develop fuels made from cellulosic sources such as grass and wood chips, is finding that it can’t use these materials if it hopes to survive. Instead, it’s going to use corn, a common source for conventional biofuels. What’s more, most of the product from its first facility will be used for chemicals rather than fuel.
As the difficulty of producing cellulosic biofuels cheaply becomes apparent, a growing number of advanced-biofuels companies are finding it necessary to take creative approaches to their business, even though that means abandoning some of their green credentials, at least temporarily, and focusing on markets that won’t have a major impact on oil imports. This is hardly the outcome the government hoped for when it announced cellulosic-biofuels mandates, R&D funding, and other incentives in recent years.
Here’s the story on the subsidy ending from the Detroit News:
Congress adjourned for the year on Friday, failing to extend the tax break that’s drawn a wide variety of critics on Capitol Hill, including Sens. Tom Coburn, R-Okla., and Dianne Feinstein, D-Calif. Critics also have included environmentalists, frozen food producers, ranchers and others.
The policies have helped shift millions of tons of corn from feedlots, dinner tables and other products into gas tanks.
Environmental group Friends of the Earth praised the move.
“The end of this giant subsidy for dirty corn ethanol is a win for taxpayers, the environment and people struggling to put food on their tables,” biofuels policy campaigner Michal Rosenoer said Friday.
Dirty Corn Ethanol? I’m all for ending taxpayer siphoning, but dirty corn ethanol?
Full story h/t to Lawrence Depenbush
OT but a reminder that neither NH or SH ice extent is falling and its now 2012.
We’ll see. I remember ‘oil from turkey guts’. The company was a lot like Mascoma. They had big backers. The process worked and was close to economic. They claimed that using agricultural waste they could replace all the oil imported to the United States. They just couldn’t run a profit. http://en.wikipedia.org/wiki/Changing_World_Technologies
If I were thinking about fuel from a biological feedstock, I would worry more about shale gas and shale oil coming on line. That will lower the price of all fuels and make it hard to profitably sell bio-fuels.
It was my understanding that Al Gore changed tack about a year ago and is now leaning more my way, at least on corn based bio-fuel thus far. (I’ve always called the use of food and food producing potential for machine fuel an evil practice that should be banned. )
I and most others who post comments here have FAR more scientific education and just basic scientific instinct than Al Gore but of course the NYT doesn’t pay any attention to us because it’s a political agenda not a scientific one. How long before Al admits that he was completely wrong about CAGW too? tick..tick..tick..
If you want to create carbon fuel for the future, do this:
1. Outlaw paper recycling. Force trees to be planted for paper. Collect the waste paper, convert it to slurry and pack it in to old coal and limestone mines as tightly as you can pack it. Compress the living hell out of it and fill those mines back up with carbon in the form of paper slurry. Seal off the entrance with 10 feet or so of concrete and let nature take its course. Every ton of coal extracted gets a ton of paper put back in its place. Coal becomes “carbon neutral”. Same with strip mines. Fill them back up with paper compressed to nearly rock and put the overburden back over it.
Put carbon back into the ground to replace the carbon you take out from coal mining.
It is just foolish in the extreme to burn food for fuel when you can burn something that cannot be food. We are told that burning 1/3 of the corn harvest is somehow “sustainable”, despite its total lifecycle cost. But what else is new? The left loves to scold the rest of us about “sustainability” yet none of their economic schemes are ever sustainable. And sure enough, we got exhausted attempting to maintain the mirage that ethanol was sustainable.
A. Scott says:
December 28, 2011 at 2:52 am
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Now that we have heard from the ethanol lobby, can we get back to reality?
Ah yes, the standard left wing attack on speculators.
Speculators do not cause price increases, at worst speculators shift the timing of price changes. Speculators buy know when they believe that prices will go up in the future. This does cause a price increase now, however when the speculators later sell what they bought, they cause an equal price decrease. What speculators do is even out price swings making prices more stable over all.
Any time you hear someone trying to blame speculators you know you are dealing either with an economic illiterate, or someone who is trying to shift blame from the real villians.
All I have to say is that if ethanol is so efficient and cheap to make, why do we need subsidies and mandates in order to get people to make and buy it?
Valero is putting up most of the money for Mascoma’s new wood-to-ethanol refinery. Valero knows a little something about “refining,” so, we’ll see.
I expect to see an approx. $1.00 spread between ethanol, and gasoline later in the year. That would be approx $2.00/gal for wholesale ethanol vs. $3.00/gal for RBOB.
Many people are expecting an IC Engine that gets essentially the same mileage on high ethanol blends, and gasoline within a year, or two (with more HP from the ethanol blends.) About the only remaining steps are “heated injectors,” and an “ethanol sensor” in place of the O2 sensor.
Largely unremarked upon this year is that the majority of Ford F-150 Sales have been Six-Cylinder Engines, with the majority of those being of the Flex-Fuel Eco-Boost (Turbo-Charged) variety.
There should be no subsidies to help farmers. Just put a price on carbon emissions and be done with it. Don’t choose technologies.
The subsidy may be over but the “mandate” to use ethanol in gasoline still stands for the time being. Without the subsidy and with the mandate will it not just increase the cost of gasoline at the pump?
So many subsidies…. So little proper research…
All of this (solar, wind, ethanol, etc…) comes back to that most famous of quotes by Ernest Benn (British Labour politician Tony Benn’s uncle, himself a politician)….
‘Politics is the art of looking for trouble, finding it everywhere, diagnosing it wrongly and applying unsuitable remedies…’
Some well informed debate here. Good stuff.
CommieBob
The CWT plant was a serious mis-application of technology.
1. Who thinks “turkey” and “excess fat” at the same time. Their feedstock had a very low energy value.
2. Turkey waste products have food value (they assumed it wouldn’t due to the BSE scare) and sells for $40 a ton for animal feed.
Shale gas is very expensive and is close to uneconomical at todays prices. If they can’t make money they won’t drill.
A. Scott says:
December 28, 2011 at 2:52 am
Thanks for your input, I appreciate informative comments with a lot of work behind them.
You didn’t say if you say the industry still needs subsidies. Someone else commented on using natural gas as a feed stock for making ethanol. I imagine that’s doable, though I don’t have the organic chemistry knowledge to point to any particular process.
We don’t pay too much attention to E85 here in New Hampshire. According to http://www.e85refueling.com/ Vermont, Maine, and NH have no E85 service stations. (Neither do Alaska and Hawaii.) I assume the transportation charges are the killer.
Ethanol is dirty only because the fermenting process converts nearly half of the sugar into CO2, the rest is then the fuel. If you are concerned at all about CO2 levels don’t ferment. This is the environmentalist’s dirty argument.
A comment to A. Scott–
When I am forced to use a 10% or less ethanol mixture in my Toyota RAV4, I get 10-15% lower gas mileage than with regular gas, and the price is the same for 10% ethanol versus regular gas. Here (Kansas) the difference between e85 and regular gas is about 10 cents per gallon. I lose money and mileage when I have to use ethanol. And the amount of the US corn crop that has gone to ethanol production in the past few years has been 40% not 30%.
Here in Kansas, many farmers grew corn in areas that would not normally have been planted in corn because the price was so high this year (due in part to ethanol demand)–many of those farmers lost their crop to floods on the Missouri, or to drought in July, because they planted in non-irrigated areas. I could be wrong, but I am not sure there is difference between the corn used for animal feed, the corn used for ethanol, and the corn used to make corn meal, corn sweetener, and related products. There is a big difference between field/feed corn and sweet corn from the farmer’s market.
A. Scott, you seem to know a lot about ethanol; I have an enormous interest but not much knowledge. Here, in Canada, unlike the USA, we are a net exporter of oil, and for this, and other reasons, it makes no sense for us to have a corn ethanol industry. However, with our large agriculture industry, producing massive quantities of cellulose, cellulose ethanol is an entirely different matter.
Several years ago, Iogen, in Ottawa, Canada, developed the technology, and built one of the first pilot plants, producing about half a million litres of cellulose ethanol per year. For many reasons, a full scale production plan was never built. More recently, Poet, undert it’s Project Liberty, has developed very similar technology. They are due to build a production plant, with an output measured in tens of millions of gallons per year, in 2012, with production to start in 2013. What is your assessment that Poet will be successful
a. technologically
b. economically
using your definitions as to what these terms mean?
A. Scott says:
December 28, 2011 at 2:52 am
“Another bash ethanol thread – goody :rollseyes:”
Thanks for providing a balancing argument for ethanol – very informative.
If ethanol is a good idea, and production seems fairly well underway, then why can’t the free market provide whatever support is needed? Why is public funding needed? Can’t the industry simply stand on its own?
I own a small high-tech manufacturing company. We are 100% supported by the market even though we have lots of great ideas. Most of these ideas will never be realized due to lack of funding. We cannot even get an SBA loan what’s more direct public funding.
What makes corn ethanol production worthy of public funding if it is already a good idea?
I do not mean this question to be taken rhetorically; it is a topic of interest to me; and I know I should just do my own research – but I’m really busy and if you could provide some more information and a cogent argument for public funding of corn ethanol production I would be grateful.
Thanks in advance.
mikelorrey says: “Mascoma Corp has just inked deals with a couple companies to build cellulose to ethanol facilities. Their process is patented and trumps all existing wood/ethanol processes, which is why their competitors are exiting the business.”
Mike, I have been trying to find information about Mascoma Corp. There are lots of news items about them getting loans from DOE, and sundry other financing options. But, I can find nothing at all about how much biofuel they are actually producing from their demonstration facility. The demonstration facility was completed in 2008, and was supposed to be able to produce 200,000 gallons per years, but I can find nothing about the actual production. Do you happen to have a link that shows actual production from their demonstration facility, in particular for 2011?
Hurray!
Some excellent points A. Scott in both your posts.
Brazil has clearly had some issues with its sugar cane harvests in recent years, e.g.
http://www.ethanolproducer.com/articles/8294/aging-cane-fields-weather-continue-to-affect-brazil-crush
…… but I think (without the ability to read Portuguese) that JFB (says:December 28, 2011 at 3:29 am) is still probably correct and Brazil is a net exporter, although they do import some ethanol from the U.S. (don’t ask me how that works).
The Wikipedia article on Brazilian ethanol is pretty good and shows what a huge success story that has been for Brazil.
http://en.wikipedia.org/wiki/Ethanol_fuel_in_Brazil
The linked article about Gevo is, other than the title, also an excellent read. The title is rather odd because this isn’t about “survival”. In fact, this industry sector is thriving, with several huge IPOs being completed already this year (including Gevo’s $100MM IPO in February). The realization that the infrastructure built for bioethanol can be used for more expensive chemicals has been great news. The one example of plastic bottles is based on an ability to make p-xylene which is in every plastic bottle made. This market is amazingly huge and will, in fact, lead to less petroleum dependency as p-xylene currently comes from petroleum.
Lastly, and as has been noted above, the article describes how the cellulosic feedstock situation is really related to an immature current infrastructure. The chemistry and enzymology of cellulosic sugar production is quite advanced and technology is continuing to advance. Projections for costs of cellulosic sugars at scale are actually very promising, with 20 cents/Kg being a current target. Some producers are even suggesting that 10 cents/Kg is attainable. Not only would that put the advanced biofuels well within the range of profitability, but would lead to huge profitability across a whole range of specialty and commodity chemicals. So lets not throw the baby out with the bath water just yet.
Something to remember: Plants, trees, manufacture their body, made of CELLULOSE, a polymer of GLUCOSE, out from the CO2 they breath ,and WE EXHALE at a rate of 900 grams a day, water (H2O) and LIGHT from the SUN above, in a process called photosynthesis; in other words: An Energy saving process intended for the sustainability of LIFE ON EARTH. Precisely, that chain of feeding is called ECOLOGY (which includes the eating of a human being by a predator-a fact currently ignored by the tragically comic eco nuts-). Then its main purpose is to serve as FOOD (which, wisely, also includes that elevated form of energy called WHISKEY´s or WINE´s ethanol). If we foolishly change the way of nature, the way of ecology, we are NOT BEING GREEN, but simply idiots.
By insanely fighting “CARBON” we have declared the WAR AGAINST FOOD, AGAINST OUR FOOD!, and not only our daily food but against our UNDERWEAR, against our PANTS AND SHIRTS, made out of CELLULOSE, thus if we (rather YOU, “first -and broken- world” FOOLS) succeed in your silly “green agenda” (A.K.A.: Un´s “AGENDA 21”), success will be heralded by hunger and nakedness, and, finally LIFE WILL END ON OUR PLANET.
Thanks God, before that happens, you know what will happen instead-it´s happening right now!-, and it will be for you only to enjoy it.
polistra: “Also worth note: this move (or rather action by default!) happened JUST BEFORE the Iowa caucuses, not JUST AFTER as you’d expect. ”
The Iowa Farm Bureau has come out in favor of eliminating the ethanol blender’s credit as well as eliminating direct farm payments. So I don’t know why you’d think the caucuses would have any effect.
Just one step remains to be taken by Congress: Eliminate the mandate for blending ethanol with gasoline. When that fateful step back to market-based competition is taken, all mystery about the comptitiveness of ethanol will be ended. My prediction is that when that prospect looms (hopefully immediately following the 2012 election) panic will prevail in Iowa.