GoodFuels

Impact of ethanol on farmers

Via Daily Finance:

In an interview with farmer Brent Porteus, past president of the Ohio Corn Growers Association, Daily Finance discusses the corn market and “prospects for the future”.

When asked how ethanol impacted his farming operation in the past year, Porteus has this to say:

“The impact of ethanol is not as great as many people believe. It’s still only a part of the market — last year, three billion bushels. Sixty percent of our corn production is used to feed livestock, while over two billion bushes went to export last year, up 6 percent. Last summer, China was buying commodities, since they were a bargain due to the weak dollar. The spike in grain prices occurred when oil prices went up and the stock market declined, and money looking for a safe haven flowed into commodities. This ‘perfect storm’ was what drove prices up steeply for a couple of months. It wasn’t a corn problem; it was an energy problem.”

As for the food vs fuel debate, he believes that this country’s farmers will be able to renewable fuel and feed the country at the same time:

Porteus points to the dramatic increase in our nation’s yield per acre over the past 30 years. In 1978, the U.S. corn harvest was about 6.3 billion bushels; in 2008, 12.1 billion. He believes that, with new planting technology and improvements in the corn stock, farmers will be able to increase their yields to serve the ethanol industry without driving up food prices. Also, as the USDA points out, only 19 percent of our food cost comes from the cost of grains and seed oils.

Interesting interview. Read the whole thing here.

Photo courtesy of rsgreen89.

What Chu Said in Iowa

Energy Secretary Steven Chu was in Des Moines Monday to announce more than $16 million in American Recovery and Reinvestment Act funding for energy efficiency and renewable energy projects in Iowa during a news conference with Governor Chet Culver. But his announcement took a back seat to some of the comments about ethanol he made during Q and A with reporters.

First, Chu indicated that he supports approval of the waiver that would allow up to 15 percent ethanol blends for standard vehicles currently being considered by the federal government. “I don’t want to prejudge what they’re going to find, but if the existing automobile fleet can handle 15 percent, I would say let’s make that a target and go to 15 percent,” Chu said. “This is very important for decreasing our oil independence.”

Chu also suggested that car manufacturers ought to make all new automobiles flex-fuel capable. “I’ve been told it costs about $100 in gaskets and fuel lines to turn a car so that it can go all the way to E85,” Chu said. “But a new car , it would only cost $100 out of $15,000. Wouldn’t it be nice to put in those fuel lines and gaskets so that we can use any ratio we wanted?” He said that while mandating that companies make all vehicles flex-fuel is “beginning to be discussed” by the administration, they first want to “see about whether the current fleet can take 15 percent or 13 percent ethanol.”

When it came to the issue of indirect land use change and how corn ethanol can measure up using the calculations proposed by EPA under the Renewable Fuels Standard for lifecycle greenhouse gas emissions, Chu had to do some dancing. “The Obama administration has made it very clear that they would rather get to where we need to get to in terms of decreasing our carbon footprint by legislation not by regulatory things,” Chu said when questioned about the matter. He then launched into a discussion about the potential cellulosic sources for biofuels hold for farmers.

Asked more specifically about the EPA proposal, Chu said, “It’s out for peer review and we’ll see how it plays out.” That comment prompted Rep. Leonard Boswell (D-IA), a member of the House Agriculture Committee who was also at the press conference, to say to the secretary, “I hear what you’re saying, I’ve heard it loud and clear, and we’re very concerned about it and there’s a fairly large group that’s making this come to the table for discussion.”

Here is an audio file with Chu’s answers to some of the questions posed. The audio from the reporters was not audible, but you can pretty much figure out what they were asking.

Sec. of Ag writes op-ed for The Hill

Tom Vilsack, Secretary of Agriculture over at USDA, wrote an op-ed for The Hill on Monday. Vilsack discusses rural America’s important role in energy independence, how it relates to national security and the state of the country today, and initiatives the Obama administration is taking to help the growth of rural areas:

President Obama and I share a common vision that our nation’s farmers, ranchers, forest owners and rural communities should lead the way in creating a new-energy economy and producing more of our nation’s power through renewable sources. Right now we have the unique opportunity to spur economic development, improve our environment, and create jobs domestically by replacing our dependence on fossil fuels with energy-efficient biofuels.

Vilsack touches on the newly-formed Biofuels Interagency Working Group, highlighting their hopes to “develop policies to increase flexible-fuel vehicle use and assist in retail marketing efforts while taking a broad view of how to strengthen rural communities.”

The economic challenges facing the nation are also a point of discussion:

It goes without saying that these are difficult times for the biofuels industry: Oil prices are well below their 2008 peak, input costs have soared unpredictably and the economic downturn has decreased consumption. However, it is critical that we maintain the renewable fuel capacity that we have already built as we support the transition to second- and third-generation biofuels.

It’s refreshing to see that clean energy (in particular, biofuels) are near the top of the Obama administration’s priorities. There are only so many ways to displace some of the imports of finite sources of petroleum, and ethanol is available NOW. Definitely worth a read.

Click here to see the whole column.

Ethanol Celebrates Silver

Considering that ethanol was a virtual unknown as little as five years ago, most people would be amazed to know that some people have been working to make this fuel part of the nation’s energy portfolio for more than 25 years.

This week in Denver, thousands of ethanol industry representatives are gathered for the 25th annual Fuel Ethanol Workshop, the largest and oldest conference dedicated to ethanol in the world. BBI International owns and organizes the event and CEO Mike Bryan opened the conference Tuesday morning with his reflections on the difficult time the industry is experiencing. “Ethanol is the only domestic liquid fuel that we have,” said Bryan. “The image that ethanol has is the root of our problems.” He called on people in the industry to work harder to improving ethanol’s image, especially on the local level. “It’s time we take back control of this industry. It’s time we take back control of our message. It’s time we take back control of our image,” Bryan said.

Listen to Bryan’s speech here:

In a highly emotional moment during the opening session, Mike’s wife Kathy was honored with the FEW High Octane award for a lifetime of commitment to the ethanol industry and son Tom accepted the award in her place. This is the second year in a row that her battle with cancer has prevented Kathy from attending the conference she originally started 25 years ago, but she did record a message that was played for those in attendance at the general session. “I’m usually here behind the podium giving this award, so it’s a little awkward to be receiving it this year,” Kathy said. “I can only tell you that I am truly honored and very proud to be part of the huge team of ethanol pioneers.”

Listen to Kathy’s message here:

The first FEW held 25 years ago started with just a couple dozen dreamers like Kathy who saw the potential for our nation to grow and produce a renewable source of liquid fuel. Many are still in the industry today and in Denver this week working to keep that dream alive.

Governator Promotes Home Brewed Ethanol

Despite the fact that California’s Air Resources Board found corn ethanol to be worse than gasoline for the environment, Governor Arnold Schwarzenegger thinks making it at home from beer is a great solution for reducing greenhouse gasses.

During a ceremony on the steps of the state capitol last week, the governor unveiled the final production model of the world’s first home ethanol system, the E‐Fuel MicroFueler™.

“It takes what is essentially a byproduct of beer, something that would be normally thrown away and turns it into fuel. That means that drivers now can have their own MicroFueling Station at home,” said Schwarzenegger. “And what’s also special, is that this can produce up to 40 gallons a day.”

According to the E-Fuel website, “the MicroFueler supports a variety of organic fuel (waste) as feedstock to produce the E-Fuel100 ethanol. Substances rich in sugar, fermentable material, alcohol or even algae may be suitable for ethanol conversion. Under the new E-Fuel model, consumers will simply pay for the ethanol they pump and have no concern for obtaining and replenishing the organic fuel (waste) which is processed into ethanol. Servicing dealers will respond to status messages from the MicroFueler and replenish the organic fuel as need to insure constant availability of E-Fuel100 ethanol at the pump.” Retail cost for the system is $9995, plus $9.95 per month for connection to the E-Fuel Global Network.

The question is, just how practical is this for home use? The governor says California is exploring a pilot program using the MicroFuelers for the state’s fleet of E85 vehicle, which might be practical, but I wonder how many households would be in the market for the $10,000 personal ethanol pump. The pump actually produces 100 percent ethanol, which means the product will have to be mixed with regular gasoline for use in even flex-fuel vehicles.

The governator did have some nice things to say about ethanol during his speech. “Ethanol holds a promise of reducing the fuel costs, which is very important, because so many times we are all subject to the oil prices,” said Governor Schwarzenegger. And that is true - even if you don’t make it yourself.

Read and/or watch the governor’s speech here.