Today in Biofuels: EPA denies stricter emission standards for 17 states, California to sue; Petrobras to construct 10 more biodiesel plants in Brazil; Boeing sees breakthrough on jet biofuels

Top Story:

The U.S. Environmental Protection Agency has denied California’s request to require a 30 percent reduction, by 2016, in greenhouse gas emissions from cars. 16 other states (Arizona, Colorado, Connecticut, Florida, Maine, Maryland, Massachusetts, New Jersey, New Mexico, New York, Oregon, Pennsylvania, Rhode Island, Utah, Vermont, and Washington) have adopted the same emission standard as California, and the approval of California’s request would have provided a blanket approval for all 17 states. The Clean Air Act requires states to apply for a waiver from the EPA before imposing higher greenhouse gas emission standards, but this is the first instance in more than 50 applications in which a state has been denied a waiver. California attorney-general Edmund G. Brown Jr. told the Environmental News Service, “Governor Schwarzenegger and I are preparing to sue at the earliest possible moment.”

Producer News:

In South Dakota, VeraSun Energy said that it has commenced construction of a corn oil extraction works at its 120 Mgy ethanol plant near Aurora. The unit will extract corn oil from distillers grains, a by-product of the ethanol process. The new unit is expected to generate up to 8 Mgy of corn oil, which will be sold to biodiesel producers. The company plans to expand the technology to its Fort Dodge and Charles City plants by the end of 2009.

In Illinois, two ethanol plant projects are stalled or cancelled due to the recent downturn in ethanol margins or opposition by local officials. In Iroquois County, the Global Renewable Energy plant was rejected narrowly by county officials. Heartland Energy’s proposed 55 Mgy plant in Pike County plant is unable to secure financing. However, Marquis Energy’s  100 Mgy plant in Putnam County and Patriot Renewable Fuels’ 100 Mgy plant in Henry County are proceeding with construction, while Illinois River Energy announced plans to increase capacity at its Rochelle plant by 50 Mgy.

In Minnesota, SunOpta BioProcess agreed with Central Minnesota Ethanol Co-op in Little Falls to cooperate on studies for a 10 Mgy cellulosic ethanol plant. The proposed plant, which would be co-located with CMEC’s existing corn ethanol plant, would be operated by a joint venture and use wood chips as a celluosic ethanol feedstock.

International News:

In Brazil, the first ethanol bus has been delivered to Sao Paulo’s Metra transit system and will be tested on the São Paulo – Jabaquara  route for one year. The bus, manufactured in Brazil through the support of the Bioethanol for Sustainable Transport project will be tested for performance in comparison to diesel-powered buses. The ethanol bus project cost US$ 887.9 million.

In Thailand, Mae Sot Clean Energy, a joint venture between Padaeng Industry, Thai Oil and Petrogreen, has begun construction on a $65 million ethanol plant in Tak province. The sugarcane ethanol plant has a planned capacity of 19 Mgy, and would generate 16 megawatts of power. 7 Megawatts of power will be sold to the national grid.

In Brazil, Petrobras announced that it will construct 10 new biodiesel plants between now and 2012, in addition to three already announced for opening next year. Total project cost for the 13 facilities is projected at $507 million and planned capacity is 225 Mgy.  The initial three plants, scheduled to open in March 2008, have a planned capacity of 48 Mgy.

In Israel, Vogene and Orfuel have jointly signed with the Israel-US Binational Industrial Research and Development Foundation for a $1 million grant for a 3-year research project in alternative energy.

Research and Education News:

In North Dakota, Mid Plains Community College and five other community colleges will develop a Future Fuels Certificate course that will commence in Fall 2008. The online and campus-based program will train workers for ethanol industry jobs. The project will be funded through more than $2 million in grants for Community Block Job Training Ethanol Training Program.

Policy and Policymakers:

In Washington, acting agriculture secretary Charles Conner said that the US has more than enough acreage to produce ethanol and biodiesel required under the new Energy Independence Act. Under the Act, the nation will increase its consumption of ethanol by to 15 billion gallons by 2015 and to 1 billion gallons of biodiesel by 2012, but Conner said that corn yields are expected to increase in the intervening years. The US corn harvest was 13.2 billion bushels for 2007.

In Illinois, Carbon Green said it expects to significantly increase carbon credit grants for ethanol plants, following the first grant of credits to the 44 Mgy Corn Plus facility in Minnesota. Carbon Green execs said that ethanol significantly reduces the 21 pounds of carbon released per gallon of gasoline, and that this reduction will eventually be eligible for credits. In addition, the company said that US biofuels plants will be able to earn and trade carbon credits for the reduction of fossil fuel emissions during their production process. The Corn Plus plant in Minnesota burns corn syrup to offset fossil fuel use, and uses two wind turbines for electricity.  http://farmweek.ilfb.org/viewdocument.asp?did=11085&drvid=102

Consumer and Fleet News:

In Washington State, Boeing has confirmed in tests that a wide range of feedstocks can produce biofuels suitable for jet aircraft, and the company says that these biofuels can be commercially produced on an economically viable basis. Boeing said that it expects to offer both financial and technical support to what it sees as a growing distribution system of jet biofuels. The company has partnered with Virgin Atlantic and Air New Zealand to test biofuels on 747s. The flight-test will consume 1,000 gallons of biofuel, from an feedstock that is yet to be selected.

Financial News:

The Biofuels Digest Indexâ„¢, a basket of public biofuels stocks, gained 4.39 percent to close at another 52-week high of 126.22 as the roll-on effect of the signing of the Energy Independence Act continued to push the sector skywards. The Index has gained 29.55 points, or 30.5 percent, since October 3rd. For the day, diversified agribusiness Archer-Daniels-Midland (ADM) leapt 4.62 percent to close at $43.29, while Aventine gained 8.52 percent to finish at $12.99 and lead the midcap stocks after receiving a boost from Calyon Securities analyst Kelly Dougherty in a note to investors. Among small caps, Green Energy Resources (GRGR.PK) rose 13.55 percent to $0.176, while Better Biodiesel (BBDS.OB) fell 6.67 percent to close at $0.70. Overall, gainers led losers by a margin of 2 to 1.

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