Today in Biofuels: Big Oil ramps up development of bio-crude; new one-step cellulosic ethanol enzyme; Clintons linked to “degrading” ethanol operation in Brazil
Submitted by Biofuels Digest Blog
Top Story:The Wall Street Journal has profiled the sharply increased tempo of activities of Bio Oil in the research and production of bio-oil, or bio-crude. The current energy-transportation system “has been a hundred years and billions of dollars in the making,” Rick Zalesky, vice president for biofuels and hydrogen at Chevron’s alternative-energy arm told the Journal. “The ideal outcome of our research is to develop biomass-based transportation fuels that have chemical properties similar to those of gasoline and diesel,” he said. The profile covers efforts by BP, Marathon, ConocoPhillips, and Shell to produce a viable alternative to petroleum that can utilize the existing oil company infrastructure.
Producer News:In Florida, the state Department of Environmental Protection awarded $1.5 million to Renergie to design and build Florida’s first sweet sorghum juice mechanical harvesting system and ethanol plant. Previously, Renergie has been active in the construction of ten small ethanol plants, with a combined capacity of 50 Mgy, developed in parishes of the State of Louisiana hit by hurricanes Katrina and Rita. The Renergie project will be the first sweet sorghum juice ethanol plant in the U.S. Sweet sorghum produces up to 800 gallons of ethanol per acre, and requires half the water needed to grow corn, while also utilizing marginal land or cover crop growing periods.
In Iowa, the state government has fined Cargill $100,000 for environmental violations at the Iowa Falls biodiesel plant. Violations included spreading waste on land, but now is in compliance. The state attorney-general filed suit, but settled with Cargill shortly after filing. In the agreement, Cargill agreed to prevent future violations at its four Iowa plants.
In California, Pacific Ethanol said that it would delay reporting of its annual results, and will now file on March 31, 2008.
International News:In England, the founder of jatropha pioneer D1 Oils announced his resignation as a director after news of a new capital raise caused shares of the company to plunge 40 percent. Karl Watkin said that the media and analysts were unable to distinguish between sustainable and unsustainable fuels, and were lumping D1 unfairly with companies with unsustainable practices.
Friends of the Earth told the UK’s Guardian newspaper that D1 was unrealistic about jatropha, and it was this that caused the share meltdown. The advocacy group said the jatropha was poisonous, grown in an unsustainable manner and were realizing smaller yields than initially projected.
In Canada, Husky Energy will abandon wheat as an ethanol feedstock, and is offering $6 per bushel for spring corn deliveries, following the run-up in wheat prices. The rapid increase in wheat prices has prompted farmers to withhold wheat from the market in the hope of achieving higher prices at a later date. Husky said its Minnedosa plant in Manitoba has already switched to a 75 percent corn blend with 25 percent wheat.
In Brazil, an ethanol plant connected to an investment group including former US President Bill Clinton has been described as providing “degrading” conditions for its field workers. Brazil Renewable Energy Co., or Brenco, said that it was addressing the problems. President Clinto and his wife Sen. Hillary Rodham Clinto have an investment listed at between $15,000 and $50,000 in the plant, through the Yucaipa Company controlled by Ron Burkle. Yucaipa owns 2.8 percent of Brenco.
In Australia, Natural Fuel Limited said it would switch to high grade glycerine production, from biodiesel, after it was reported that the company recorded a $40 million loss for 2007. Natural Fuel’s CEO denied the report, saying the loss was smaller.
Research News:In Maryland, researchers have launched a new company, Zymentis, to commercialize a new enzyme they say will break down plant cell walls into sugars in one step. The researchers, from the University of Maryland, said that their discovery could produce as much as 75 billion gallons of ethanol using a synthetic version of a Chesapeake Bay marsh grass bacterium, S. degradans.
In Oregon, the state Department of Agriculture has made a $250,000 grant to study the conversion of ryegrass waste straw into ethanol. Growers view waste straw as a problem, and the Oregon Seed Council and Oregon State University researchers will study if the straw can be converted into ethanol.
Policy and Policymakers:In Washington, the EU ambassador to the US, John Bruton, said that US biodiesel incentives are a “negative development” that threaten the US-EU commercial relationship. US subsidized exports to Europe, which grew by 1000 percent in 2007 to 1 million tonnes, now represents 20 percent of the European market, and that as much as $300 million of US taxes are spent in support of the biodiesel incentives granted on fuel for the European market. The European Biodiesel Board has threatened an anti-dumping complaint with the European Commission, but has not yet done so.
Consumer and Fleet News:The U.S. Federal Trade Commission has commenced hearings to revise standards for green marketing. The Commission’s environmental marketing guidelines have not been updated since 1998, and do not include a standard for “carbon-neutral”, for example. Recently the UK’s Advertising Standards Authority ruled against ads run by the Malaysian Palm Board, while the Belgian ad watchdog organization ruled against ads by Saab claiming that the “Biopower” cars make roads “finally turn green”.
Financial News:The Biofuels Digest Index™ (BDI), a basket of public biofuels stocks, slid 4.57 percent Friday to 118.32 on dismal trading conditions for diversified agribusiness and ethanol. For the day, Archer Daniels Midland (ADM) fell 4.71 percent to $42.89, while The Andersons (ANDE) plunged an equally wretched 4.21 percent to close at $42.13. Among ethanol stocks, VeraSun Energy (VSE) fell 3.29 percent to close at $6.76. Among small caps, Environmental Power (EPG) fell 4.80 percent to $4.76. Declines led advances 7 to 1.
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