Today in Biofuels: first commercial algae farm for biofuels in US; sizzling Khosla, Branson articles; 30 Hungarian ethanol projects dropped

Top Story:

In Texas, PetroSun will open the first US commercial-scale algae farm for biofuels near South Padre Island. The 1,831 acre site includes 157 separate ponds, and the company said that extraction of algae from water and oil from algae were studied and solved at the company’s pilot farm in Opelika, Alabama. PetroSun said that results from the pilot farm demonstrated a yield of between 5,000 and 8,000 gallons per acre, or a potential oil production of 9-15 Mgy at the South Padre Island facility.

Producer News:

In Iowa, the Renewable Energy Group cancelled its $150 million IPO, citing poor market conditions. The company had hoped to use proceeds from the IPO to fund one-third of the construction costs of 180 Mgy in new production capacity at three locations. The company has two 60 Mgy plants under construction in Louisiana and Kansas, owns a 12 Mgy plant, and operates three other plants for other owners with a 120 Mgy capacity.

In Indiana, the Corporate Organization for Renewable Natural Energy (CORNE) announced plans to construct a 40 Mgy corn ethanol and biodiesel plant near Elkton. The company said that construction of the plant, restaurant and medical facility would cost $72.5 million and would take the place of an abandoned fertilizer plant.

In California, the Hanford City Council is set to vote on a 63 Mgy corn ethanol plant proposed by Great Valley Ethanol. Opposition to the plant’s construction has focused on noise and emission issues.

In Florida, Florida Crystals is seeking a change in Palm County ordinances to permit commercial-scale cellulosic ethanol plants to be built in industrial zones. The company has proposed one of eight plants in progress around the state, based on the 2 Mgy demonstration-scale plant that is scheduled for construction at the company’s Okeelanta mill.

International News:

In China, experts are warning that plans to produce biofuels in the China’s southwest will threaten biodiversity in the last remaining section of virgin forest in the country. Speakers warned against the planting of jatropha trees, which would threaten native grasses and a diverse range of animal species, said academics attending the International Workshop on Biodiversity and Climate Change in Beijing.

In Hungary, SEKAB has canceled plans to develop four ethanol plants in Hungary, citing financing difficulties. The company had planned an investment of $600 million in the region, but said that more than 30 plants had been shelved due to poor confidence levels among bankers about feedstock prices and economic viability. A recent drought caused Hungary’s corn crop to come in at half of normal levels in 2007, prompting fears of a a feedstock shortage.

In Germany, Petrotec said it will build two waste oil-based biodiesel plants in the UK and United States, each with a 28 Mgy capacity. The company operates a 23 Mgy waste oil biodiesel plant in Borken. The company said that the UK plant would be located in the Thames or Tees region, and the US plant would be in New York or northern California, but that more sites would be investigated. Total investment was projected at $32 million.

In Canada, the Canadian Food Inspection Agency issued a draft regulations on the use of distillers’ grains from ethanol production as livestock feed. The CFIA will publish a final version in the fall, after a comments period. The Agency said that several chemicals used in ethanol production needed to be assessed for safety, including monensin sodium and tylosin tartrate.

Research News:

Miles per acre is the subject of an article at ecogeek on the productivity of various renewable energy sources. The article credited soybean biodiesel with a productivity of 2,400 miles per acre per year; corn ethanol, 18,000; palm oil biodiesel, 31,000; switchgrass. 32,000; wind, 180,000; algae, 370,000;  solar, 2,250,000. The site said that it was clear that installation costs for solar were more than 100 times as expensive than for corn ethanol, and that biofuels can be produced on lands not well-suited for solar or wind.

Policy and Policymakers:

Writing in Forbes, Vinod Khosla said that the best way to frame the renewables policy question was: “What is the cheapest way in dollars per ton to reduce carbon emissions from automobiles?” He said that hybrids are a “PR gesture” because they can’t pay back their upfront investment in a reasonable amount of time, and added that McKinsey found that hybridization costs $90 per ton of carbon offset, the most expensive of all technologies.

Consumer and Fleet News:

Writing in The Guardian, Sir Richard Branson said that the CEO of British Airways, Willie Walsh, was wrong to describe Virgin’s support for biofuels as “a bit of a PR stunt” and said that British Airways “doesn’t have an environmental strategy.” He said that “the only businesses around in 20 years time will be green and sustainable businesses,” and added that “Sniping from the sidelines is not the answer to climate change.”

Financial News:

The Biofuels Digest Index™ (BDI), a basket of public biofuels stocks, recovered 3.45 percent yesterday to close at 119.48 as investors went bargain shopping. For the day, Archer Daniels Midland (ADM) rose 3.45 percent to close at $43.52, while among ethanol stocks Pacific Ethanol (PEIX) rose 15.38 percent to $4.95 on news of a $40 million cash infusion from by a supplier; Aventine Renewable Energy (AVR) rose 7.22 percent to $5.05. Among small caps, Nova Biosource Fuels fell 18.93 percent to $1.37 after a downgrade by Ardour Capital.  Overall, advances led declines 3 to 1 for the day.