Today in Biofuels: Environmental movement split between pro-biofuels and anti-growth forces; US to be 10 percent short on biofuels by 2022; E20 OK without flex-fuel car
Top Story:
An article regarding a dispute between environmental groups and Virgin Atlantic over the airline’s biofuel test said “This scrap between Branson and Greenpeace, Friends of the Earth, and Europe’s Green Party finally unmasks the real motives of these prominent environment groups. It is not just about biofuels, it is about limiting future growth. They apparently want to turn back the clock.” The article helps clarify why there is strong support for biofuels in some corners of the environmental movement, such as the New Zealand Green Party, while other groups are vehemently opposed, such as the UK Green Party. The schizophrenia among environmentalist appears to reflect that the “green movement” has fused both pro- and anti-growth groups, who see biofuels as, respectively, an enabling technology or a threat to the anti-growth agenda.
Producer News:
In Wisconsin, Innovation Fuels announced the acquisition of North American Biodiesel, including the company’s leasehold at the Port of Milwaukee which brings Midwest-based tank storage, and petroleum pipeline access. Innovation Fuels also announced that became the first Northeast-based biofuels producer to BQ-9000 Accreditation from the National Biodiesel Board. Innovation Fuels acquired Eastern Biofuels last September, and is upgrading the New Jersey-based biodiesel plant from 6 Mgy to 40 Mgy; the company has a 50 Mgy biodiesel project under development in New York.
In Massachusetts, a director at Credit Suisse First Boston said that oil companies are looking at buying US ethanol distilleries, and said that deals would occur in the next 18 months. Paul Ho, director of the company’s global energy group, did not disclose the names of specific companies, but said that “it may be easier for them to just have some of the ethanol assets themselves,” given the 36 billion gallons of ethanol required to be blended with gasoline by 2022 under the Renewable Fuel Standard.
In Indiana, the Poet ethanol refinery in Alexandria is accepting corn shipments, and recorded 50,000 bushels in sales on the first day of deliveries. The plant expects to have 700,000 bushels on hand for the commencement of grinding on April 22.
In New York, Interstate Commodities announced that it has agreed with Northeast Biofuels to be the exclusive supplier of corn and exclusive seller of distillers grains for the corn ethanol plant in Fulton expected to open this spring.
International News:
In Indonesia, Sinar Mas and China National Offshore Oil have halted a $5.5 billion biodiesel plan, citing the high price of palm oil, saying that the price of crude palm oil was already higher than the biodiesel price. Crude palm oil futures reached a new high of $1,410 per tonne yesterday, driven by increased Chinese demand.
In Brazil, the state oil giant Petrobras said that it will establish a biofuels subsidiary to centralize its biofuel production management. The new unit will supervise both biodiesel and ethanol production, although sales and logistics will continue to be supervised by the Petrobras supply division. The company has set a goal of becoming the largest producer of biodiesel in the country.
In Canada, Enerkem announced that it expects to complete construction this fall on its 1.5 Mgy demonstration-scale cellulosic ethanol plant in Quebec. The company will produce cellulosic ethanol from creosoted urban wood (end-of-life cycle power poles). The company has operated a pilot plant in Sherbrooke since 2003.
Research News:
In Minnesota, a study by the University of Minnesota and Minnesota State University suggest that US cars could burn E20 without flex-fuel engines. Gene Hugoson, Minnesota agriculture commissioner told USA Today “We see E20 not exactly as bypassing E85, but supplementing it.” Ethanol proponents have targeted E20 as an alternative to E85, which has been dogged by controversy and low sales.
Policy and Policymakers:
In Washington, the Energy Information Administration projected that the US will blend only 32.5 billion gallons of ethanol by 2022, well short of the Renewable Fuel Standard target of 36 billion gallons. Guy Caruso, who heads the U.S. Energy Information Administration, told the Senate Energy Committee that the shortfall was expected in cellulosic ethanol, and would only be partly offset by an increase in imported ethanol following the expected repeal of the ethanol tariff in 2009. Caruso said that US fuel imports would fall from 60 percent today to 51 percent in 2022 because of the impact of biofuels production. Caruso advised that he expected US output of greenhouse gases to increase 16 percent by 2030; a drop of 60-80 percent is needed by 2050 to stop global warming.
Consumer and Fleet News:
In South Dakota, Enterprise Rent-A-Car and VeraSun Energy announced that they will expend their partnership in flex-fuel cars from Washington and Cincinnati to Sioux Falls, SD. Enterprise and its sister companies, including Alamo and National, rent 73,000 flexible fuel cars and trucks.
In Canada, the city of Toronto will convert its garbage truck fleet to biodiesel.
Financial News:
The Biofuels Digest Indexâ„¢ (BDI), a basket of public biofuels stocks, fell 0.20 percent to 127.02 as ethanol stocks took a tumble. VeraSun Energy (VSE) fell 12.3 percent to $7.83 while its intended merger partner US BioEnergy (USBE) tumbled 13 percent to $6.22, while losses were offset by a 0.57 percent gain to $46.00 by Archer Daniels Midland (ADM). Declines led advances 4 to 1.
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