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    GreenHunter Energy, Inc. announces that its wholly-owned subsidiary, GreenHunter BioFuels, Inc., located in Houston, Texas has successfully acquired Air Emission Permits from TCEQ (Texas Commission of Environmental Quality) under TCEQ's Permit by Rule (PBR) programs. These permits open the way for construction of a 105 million gallon per year (mgy) biodiesel facility including a separate but related methanol distillation facility. PRNewswire - July 30, 2007.

    Together with Chemical & Engineering News' Stephen K. Ritter, the journal Environmental Science & Technology sent Erika D. Engelhaupt to Brazil from where she wrote daily dispatches of news and observations about biofuels research. In particular she focuses on a bioenerrgy research partnership between the American Chemical Society, the Brazilian Chemical Society, and the Brazilian Agricultural Research Corporation (EMBRAPA). Check out her blog. Dipatches from Brazil - July 28, 2007.

    Consultation is under way on a £50 million (€74/US$101million) renewable energy plant planned for the South Wales Valleys. Anglo-Dutch company Express Power plans to build a wood-fuelled biomass plant on Rassau Industrial Estate in Blaenau Gwent. The plant will generate an annual 160,000 MWh (Mega Watt hours) of green electricity for Wales from forestry, recycled wood and wood derivatives. ICWales - July 27, 2007.

    The price of New York crude leapt to 77.24 dollar a barrel on Thursday, marking the highest level since August 9, 2006, as keen global demand and tight supplies fuelled speculative buying, traders said. On Wednesday, the US government had revealed that inventories of American crude fell by 1.1 million barrels last week. France24 - July 26, 2007.

    Arriva, one of Europe's largest transport groups is trialling B20 biodiesel for the first time on 75 of its buses. The company is aiming to reduce total carbon emissions by around 14 per cent by using biodiesel as a 20 per cent blend (predominantly be a mixture of sustainable soya products, along with used cooking oil and tallow). The 75 buses in the innovative trial will carry around 130,000 passengers every week. Minimal engineering changes will be required to the fleet as part of the scheme. Arriva - July 26, 2007.

    Marathon Oil Corporation announces that it has completed two more projects adding biodiesel blended fuel at its Robinson and Champaign terminals in Illinois. The terminals now feature in-line ratio blending in order to provide soy-based B-2 (two percent biodiesel) and B-11 (eleven percent biodiesel). Marathon Oil - July 25, 2007.

    Norway-based renewable energy firm Global Green One has agreed to set up a € 101.6 million bioethanol plant in Békéscsaba (southeast Hungary), with more facilities planned for Kalocsa, Szombathely and Kõszeg, the latter of which was already a target for a €25 million plant in May this year. The Békéscsaba plant would process 200,000 tonnes of maize per year, employing around 100 people. The logistics part of the facility would also create 100 jobs. The company expects the factory to generate €65 million in revenues each year. Portfolio - July 25, 2007.

    A Canadian firm, Buchanan Renewable Energies, is to begin an investment into Liberia's biomass industry that will grow to US$20 million in October and offer 300 jobs by end of the year. The company will start shipping 90 major pieces of equipment to Liberia by the end of August. Daily Observer (Monrovia) - July 24, 2007.

    KNM Process Systems Sdn Bhd, has secured a RM122 million (€26/$36m) order to build a biodiesel plant in Pahang, Malaysia, for Mission Biofuels Sdn Bhd, a subsidiary of Australian biofuels company Mission Biofuels Ltd. The plant will have a biodiesel output of 750 tonnes per day and glycerine output of 82 tonnes per day. Malaysia Business Times - July 24, 2007.

    AlgoDyne Ethanol Energy Inc. confirms that its retail partner, Canadian Green Fuels, has entered into an agreement with Cansource BioFuels to open a new biodiesel production facility in Mayerthorpe Alberta. The deal will see the construction and development of a community based, integrated crushing and biodiesel facility to process 10 million litres of ASTM certified canola based biodiesel which will be scaled up to produce 40million litres by 2010. BusinessWire - July 23, 2007.

    The Center for Management Technology announces the second Biomass-to-Liquids Technology conference will take place in Vienna this year, from 12 to 13 September. The current state of BTL-technologies will be presented and discussed. Biomass-to-Liquids conversion pathways are seen by many as promising avenues into the world of second generation biofuels that relies on the use of a broad variety of possible biomass feedstocks. CMT - July 23, 2007.

    Gulf Ethanol Corporation, a Houston-based energy company, announced today that it has initiated negotiations with representatives of government and industry in Uruguay. Discussions, coordinated by the U.S. Department of Commerce, centered on the synergy between Gulf Ethanol's interest in exploiting the potential of sorghum as a non-food fuel stock for ethanol production and the ideal conditions for growing the crop in Uruguay. The company criticizes the use of food crops like corn for ethanol in the U.S. and is seeking alternatives. Yahoo Press Release - July 20, 2007.

    Dutch company Capella Capital N.V. announces its investment in BiogasPark N.V. and acquires a 20 % stake upon the foundation of the company. The remaining shares are held by the management and strategic investors. BiogasPark N.V. will invest in the field of renewable energy and primarily focuses on financing, purchasing and the maintenance of biogas plant facilities. Ad Hoc News - July 20, 2007.

    Bioenergy company Mascoma Corp. is to build the world's first commercial scale cellulosic ethanol plant in Michigan where it will collaborate with Michigan State University. The $100 million plant will rely on the biochemical, enzymatic process that breaks down biomass to convert it to sugars. One of the factors that attracted Mascoma to Michigan was the recent $50 million federal grant MSU received to study biofuels in June. MSU will help in areas such as pretreatment technology for cellulosic ethanol production and energy crops that can be utilized by the plant. The State News - July 20, 2007.

    PetroChina, one of China's biggest oil companies, aims to invest RMB 300 million (€28.7/US$39.6m) in biofuel production development plans. A special fund is also going to be jointly set up by PetroChina and the Ministry of Forestry to reduce carbon emissions. Two thirds of the total investment will be channeled into forestry and biofuel projects in the provinces of Sichuan, Yunnan and Hebei, the remainder goes to creating a China Green Carbon Foundation, jointly managed by PetroChina and the State Forestry Administration. China Knowledge - July 19, 2007.

    Netherlands-based oil, gas, power and chemical industries service group Bateman Litwin N.V. announces it has signed an agreement to acquire Delta-T Corporation, a leading US-based bioethanol technology provider, with a fast growing engineering, procurement and construction division for a total consideration of US$45 million in cash and 11.8 million new ordinary shares in Bateman Litwin. Bateman Litwin - July 18, 2007.

    TexCom, Inc. announced today that it has signed a letter of intent to acquire Biodiesel International Corp. (BIC), and is developing a plan to build an integrated oilseed crushing and biodiesel production facility in Paraguay. The facility, as it is currently contemplated, would process 2,000 metric tons of oil seeds per day, yielding approximately 136,000 metric tons (approximately 39 Million Gallons) of biodiesel and 560,000 metric tons of soy meal pellets per year. Initial feedstock will consist mainly of soybeans that are grown in the immediate area of the proposed production plant in the Provinces of Itapua and Alto Parana. MarketWire - July 18, 2007.

    Spanish power company Elecnor announced that it will build Spain's biggest biodiesel production plant for €70 million (US$96.48 million). The plant, in the port of Gijon in northern Spain, will be ready in 22 months and will produce up to 500,000 tonnes of biodiesel a year from vegetable oil. The plant will be one of the world's biggest. Spain has decided to impose mandatory blending of biofuels with conventional fossil fuels as part of European Union efforts to curb greenhouse gas emissions. Elecnor [*Spanish] - July 18, 2007.

    The University of North Dakota Energy & Environmental Research Center (EERC) conducted a feasibility study to determine the most economical solutions to provide biomass energy to the isolated Chugachmiut Tribal Community in the village of Port Graham, Alaska, located on the Kenai Peninsula about 180 miles southwest of Anchorage. The village is only accessible by air or water, making traditional fossil fuel sources expensive to deliver and alternative forms of energy difficult to implement. The case study based on decentralised bioenergy offers interesting parallels to what would be needed to provide energy to the developing world's huge population that lives in similarly isolated conditions. EERC - July 18, 2007.

    According to a basic market report by Global Industries Inc., world biodiesel sales are expected to exceed 4.7 billion gallons (17.8 billion liters) by 2010. Though Europe, with a share estimated at 84.16% in 2006, constitutes the largest market, and will continue to do so for the coming years, major growth is expected to emanate from the United States. The automobile applications market for biodiesel, with an estimated share of 55.73% in 2006 constitutes the largest as well as the fastest growing end use application. Other applications independently analyzed include the Mining Applications market and the Marine Applications market. PRWeb - July 18, 2007.

    O2Diesel Corporation announced that it has received the regulatory approvals necessary to start delivering its proprietary diesel ethanol blended fuel, O2Diesel, in the French market. The approvals pave the way for O2Diesel to move forward into the next stage of its European market development strategy by commencing deliveries to a number of targeted fleets in France. MarketWire - July 17, 2007.

    The BBC World Service is hosting a series of programmes on the global obesity pandemic. Over the coming two weeks a range of documentaries and discussions will be held on the obesity time-bomb that is growing all over the West, but also in the developing world. In North America, a quarter of people are now morbidly obese, 60% is overweight, and one in three children will become obese. The epidemic is spreading rapidly to China and India. BBC World Service - July 16, 2007.

    A new report from Oregon State University shows the biofuels industry is on track to be a $2.5 billion chunk of the state's economy within 20 years. The study identifies 80 potential biodiesel, ethanol and biomass facilities which could produce a combined 400 million gallons (1.5 billion liters) per year of ethanol and another 315 million gallons (1.2 billion liters) of biodiesel. On an oil equivalent basis, this comes down to around 38,000 barrels per day. Oregon State University - July 16, 2007.

    Jatropha biodiesel manufacturer D1 Oils has appointed a leading plant scientist to its board of directors. Professor Christopher Leaver, Sibthorpian professor of plant science and head of the plant sciences department at Oxford University, has joined the Teesside company as a non-executive director. Professor Leaver, who was awarded a CBE in 2000, is a leading expert in the molecular and biochemical basis of plant growth and differentiation. D1Oils Plc - July 16, 2007.

    Panama and South Africa are set to cooperate on biofuels. A delegation consisting of vice-minister of Foreign Affairs Azis Pahad, of Finance, Jubulai Moreketi and of Finance, met with Panama's vice-chancellor Ricardo Durán to discuss joint biodiesel and ethanol production and distribution. Panama's goal is to become a hub for internationally traded bioenergy, making use of the strategic position of the Canal. La Prensa Gráfica [*Spanish] - July 14, 2007.

    Spanish investors are studying the opportunity to invest in agro-industrial projects in Morocco aimed at producing biofuel from the Jatropha plant. Morocco’s Minister for Energy and Mines, Mohammed Boutaleb, said Moroccan authorities are willing to provide the necessary land available to them, provided that the land is not agricultural, is located in semi-arid regions, and that the investors agree to use water-saving agricultural techniques, such as drip-feed irrigation. Magharebia - July 14, 2007.

    Philippine Basic Petroleum Corp. plans to raise as much as 2.8 billion pesos (€44.4/US$61.2 million) through a follow-on offering and loans to finance a 200,000 liter per day bio-ethanol plant in the province of Zamboanga del Norte. The move into biofuels comes in anticipation of the implementation of RA 9367 or the Philippines biofuels law. RA 9367 mandates five percent bioethanol blending into gasoline by 2009, and 10 percent by 2011. Manila Bulletin - July 14, 2007.

    The Michigan Economic Development Corporation last week awarded a $3.4 million grant to redevelop the former Pfizer research facility in Holland into a bioeconomy research and commercialization center. Michigan State University will use the facility to develop technologies that derive alternative energy from agri-based renewable resources. Michigan.org - July 13, 2007.

    Fuel prices increased three times in Mozambique this year due to high import costs. For this reason, the country is looking into biofuels as an alternative. Mozambique's ministries of agriculture and energy presented a study showing that more than five million hectares of land can be used sustainably in the production of crops that would produce biodiesel fuels. The first phase of a biofuel implementation plan was also presented, identifying the provinces of Inhambane, Zambezia, Nampula and Cabo Delgado as the first to benefit. News24 (Capetown) - July 12, 2007.

    The Malaysian Oleochemical Manufacturers Group (MOMG) has urged the government for incentives and grants to companies to encourage the development of new uses and applications for glycerine, the most important byproduct of biodiesel. Global production of glycerine is currently about one million tonnes. For every 10 tonnes of oil processed into biodiesel, one tonne of glycerine emerges as a by-product. Bernama - July 12, 2007.

    BioDiesel International AG has acquired 70 per cent of the shares in Lignosol, a Salzburg based company that is making promising progress in Biomass-to-Liquids conversion techniques. The purchase price is in the single-digit million Euro range. ACN - July 10, 2007.

    Gay & Robinson Inc. and Pacific West Energy LLC announced today a partnership to develop an ethanol plant in Hawaii based on sugarcane feedstocks. The plant's capacity is around 12 million gallons (45 million liters) per year. The partnership called Gay & Robinson Ag-Energy LLC, will also ensure the continuation of the Gay & Robinson agricultural enterprise, one of the oldest in Hawaii. Approximately 230 jobs will be preserved, and a large area of West Kauai will be maintained in sustainable agriculture. Business Wire - July 10, 2007.

    Water for Asian Cities (WAC), part of UN-Habitat, is extending partial financial support for the construction of several biogas plants across the Kathmandu valley and develop them as models for municipal waste management. The first biogas plants will be built in Khokna, Godavari, Kalimati, Patan, Tribhuvan University premises, Amrit Science College premises and Thimi. The Himalayan Times - July 09, 2007.

    EnviTec Biogas's planned initial public offering has roused 'enormous' interest among investors and the shares have been oversubscribed, according to sources. EnviTec has set the IPO price range at €42-52 a share, with the subscription period running until Wednesday. EnviTec last year generated sales of €100.7 million, with earnings before interest and tax of €18.5 million. Forbes - July 09, 2007.


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Monday, July 30, 2007

Economists: current biofuel potential in Oregon may be costly and limited

With current technologies, the adoption of biofuels in Oregon could reduce the state's fossil fuel use by less than one percent, but at a much higher cost to society than more direct approaches such as a gasoline tax or raising fuel economy standards. That is the conclusion of a basic study [*.pdf] published this week by the Oregon State University Extension Service. The results are more widely applicable to other regions in the US. The findings strengthen the case for those who press for international trade in biofuels based on interdependence instead of 'resource nationalism' and energy 'independence'.

The study, by OSU economists William Jaeger, Robin Cross, and Thorsten Egelkraut, compared three types of biofuels — corn ethanol, canola biodiesel, and wood-based (cellulosic) ethanol. They examined their commercial viability, potential production scale, and cost-effectiveness for achieving energy independence and reducing greenhouse gases.
The promotion of biofuels is a public issue. Would a shift to biofuels achieve energy independence and a reduction of greenhouse gas? To answer this, we need to compare the cost for different approaches. Especially in terms of energy independence, these biofuels represent a costly and inefficient method compared to other approaches the government might take to achieve the same goal. - William Jaeger, Oregon State University economist
The researchers estimate that to achieve a given improvement in energy independence, biofuels could be 6 to 15 times more costly than other policy approaches such as raising fuel economy standards for vehicles.

When looking exclusively at reducing emissions of greenhouse gases, however, their analysis suggests that both canola biodiesel and wood-based ethanol may be cost-effective ways to achieve that goal.

Subsidies
The results are also mixed in terms of commercial competitiveness (graph, click to enlarge). The study finds that corn ethanol and canola biodiesel are currently commercially viable in Oregon, thanks in part to lavish government subsidies and regulations that have increased demand and lowered the cost of production. However, current production costs are still too high to make wood-based ethanol commercially attractive:
:: :: :: :: :: :: :: :: :: :: :: ::

How can these biofuels be commercially competitive yet represent very high-cost ways to achieve energy independence? The authors explain that in addition to subsidies that lower the cost of production while adding cost to taxpayers, there are large differences in the amounts of fossil-fuel energy required to produce each fuel, and there are large differences in the amount of energy contained in a gallon of each fuel. In other words, the energy balance of the different fuels varies considerably.

The OSU study looked only at large-scale commercial production of these three biofuels. The authors acknowledge that local or on-farm production may offer other advantages in some cases. They also caution that their estimates are subject to future changes in prices, technologies, or other developments.

The authors find that the potential scale of production for these biofuels in Oregon is limited. They estimate that these biofuels could contribute no more than a fraction of one percent of Oregon's current energy use.

"The main results of our analysis do not depend on our regional focus," Jaeger said. Although the scale of production of Midwest corn ethanol and soybean-based biodiesel is much larger than Oregon biofuels, the cost and cost-effectiveness of their production is not much different.

International trade
The results of the study differ considerably from earlier (technical) assessments made by the United States Department of Energy, especially in its 'Billion Ton' report which determined that the land resources of the United States are capable of producing a sustainable supply of biomass sufficient to displace 30 percent or more of the country’s present petroleum consumption.

More careful analyses like those made by the OSU scientists show that a case can be made for international biofuels trade. In the Global South cost-competitive fuels can be made without subsidies and in a much more energy efficient way while reducing greenhouse gas emissions more substantially. There is no reason why American tax payers should not import these fuels, instead of subsidizing their own 'national' biofuels that are not competitive and (in the case of first generation fuels) do to reduce greenhouse gases much.

References:
Oregon State University Extension Service: Biofuel Potential in Oregon: Background and Evaluation of Options [*.pdf], Special Report 1078 - July 2007.

U.S. DOE: Biomass as Feedstock for a Bioenergy and Bioproducts Industry: The Technical Feasibility of a Billion-Ton Annual Supply [PDF, 5.5 MB] - 2005.


4 Comments:

rufus said...

It appears to me that a large part of the Brazil story is "Very" Cheap Labor. This is, almost certainly, not completely sustainable in the long run. What do You think?

5:42 PM  
Biopact team said...

Mm, the main problem of the Brazilian sugarcane industry currently is the move towards mechanisation!

The mechanisation trend makes Brazilian ethanol much more competitive, but social consequences are horrible: the poor cane cutters who were already forced into the backbreaking work are increasingly being pushed out of it to end up in even greater misery.

For this reason, the Brazilian government is looking at two mechanisms:
1. expansion of the sugarcane sector by moving into lands where mechanised harvesting will not be easy (slope-lands and steep-lands)
2. expansion into biodiesel crops farmed by smallholders

A third option being looked at is to make it compulsory to have share of cane harvesting being done manually.

You may not believe it, but cane cutters working under improved conditions (yes, these exist too), have actually become the staunchest advocates of the traditional ethanol sector, which brings them jobs.

The trend towards mechanisation is a huge problem in Brazil. In São Paulo state, it is estimated that as much as 700,000 cutters may end up losing their jobs over the coming years.

The trend is in fact so worrying that Secretary of Labor Guilherme Afif has launched a study of the effects of this modernisation and mechanisation on the labor market in depth. To do so, he has signed an agreement with the SEAD Foundation to launch a state-wide survey that will be carried out over the coming 4 months.

We reported on this, here.

So it will be crucial for the Brazilian ethanol sector to find a middle ground between mechanised harvesting - one machine does the work of 50 cutters - and manual harvesting.

6:14 PM  
rufus said...

Gentlemen, there you have the problem with Socialism. It, eventually, ends up as "Ludditism" (sp?,) and that just leaves "Everyone" in Poverty.

If they mechanize, the Industry will Boom. Other, higher paying, jobs (in transportation, processing, services, etc) will be created, and they will advance. If they don't modernize, their natural advantage will be wasted, and the rest of the world will eat their lunch.

It's been the history of the world that when men used machines they prospered; but, when men competed against other men that were using machines they starved. It's the natural order of things; and, it's not going to change just because a politician wants it to.

Lula's pretty smart. I think he'll work it out.

6:55 PM  
Laurens said...

@rufus,
you certainly have a point, and I think very few Brazilian politicians are going to halt the push towards mechanisation. They just have the responsibility to make sure that the transition goes as smoothly as possible and doesn't lead to social dramas.

That's the role of a government, and companies should contribute to this process (else they risk social protest - something very real in Brazil, see the 'landless movement').

In fact, many Brazilian businesses take their social responsibility serious and they are actively doing what you describe: when they mechanise, they try to train as many former low-skilled cane cutters into becoming laborers with new skills to get them employed in the logistical and production chain that keeps generating new types of jobs.

But still, with mechanisation jobs are destroyed on a large scale and instantly, and not all low-skilled workers find a new one that easily. So there's definitely a role for the government here.

But I agree with the overall idea of a 'trickle-down' dynamic over the longer term: improved logistics, processing, and mechanised harvests boost profits and hopefully they are reinvested in new sectors of the 'bioeconomy', and so finally generate new employment.

Government and business must ensure low-skilled laborers get new training so they can participate in these new sectors.

Else, we have a problem with pure 'capitalism'!

But as you say, Lula is definitely a pragmatic politician, not against the market, but against the social injustices it tends to produce. He tries to soften these by taking the middle of the road. And I think that's reasonable.

Cheers,
Laurens

1:05 AM  

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