German firm continues development of 18 Mgy ethanol project in Saxony despite feedstock woes

In Germany, Theodor Heuss Investitions und Beteiligungs said that it will continue development of its 18 Mgy etahnol plant in Torgau, Saxony. The company will invest more than $50 million in the project, which will also produce 48,000 tonnes of distillers grains for livestock fodder.

Germany background

Recently, Choren Industries opened what it called the world’s first biomass-to-liquid (BTL) plant, a 5 Mgy plant utilizing the Carbo-V process, in Freiburg, Saxony. The company said it would take up to 18 months to reach full productivity at the plant. The Carbo V process is a gasification process in which biomass is gasified at high heat, and carbon monoxide and hydrogen are converted into synthetic diesel fuel. The fuel is chemically equivalent to conventional diesel fuel; however it is produced from renewable biomass. Choren is studying the construction of a 71 Mgy commercial scale plant in Brandenburg.

Last December, Choren announced that it will build a 57 Mgy biodiesel plant in Schwedt. The plant will use sawdust and wood chips as feedstock among other waste materials.

The company’s target is five production units and a total planned capacity of 285 Mgy by 2015, and 10-15 plants constructed by 2020 to reduce C02e emissions by 3 million metric tons.

Volkswagen and Daimler acquired a minority stake in Choren last year.

• German Chancellor Angela Merkel and Brazilian President Lula da Silva signed a biofuels cooperation agreement. The partnership establishes sustainability criteria for biofuels, and provides more than $140 million in financing for a renewable energy R&D partnership between the two countries, as well as rainforest preservation efforts in the Amazon.

Chancellor Angela Merkel recently told Bloomberg that “Millions of people are becoming wealthy, and when 100 million Chinese start drinking milk then that’s going to have an impact on food prices…rising global food prices have nothing to do biofuels.”

Recently, the CEO of the VDB, a biofuel trade association, called on the German government to prevent cheap Brazilian ethanol from entering the German market, saying that German firms could not compete and that their existence was threatened. Germany mandates an E2 blend in all gasoline, but grain prices have made German ethanol uncompetitive with Brazil’s sugarcane-based product. According to the Guardian, Germany produced 310,000 tonnes of bioethanol last year, down 10 percent from 2006.

• Our European correspondent reports that the Agricultural and Economic Cooperation and Development ministries are at war over biofuels. The state secretary for Agriculture, while conceding a link between ethanol production and corn prices, is cautioning against over-reaction. Meanwhile, the ministry of Economic Cooperation and Development has called for a halt in using oilseeds and grains for biofuel.

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