[HoosierRon]

As you read these stories, think not just about the fuel, but about all of the related economic activity that the projects are creating, and how the money invested is staying in each area's local economy. Also note how in each area, fuel is being made from local resources.

Hawaii: 8 million gallons of biodiesel per year from algae

An algae-based oil factory is being proposed for Maui. Here, a marine algae venture, run by HR BioPetroleum Inc. and Royal Dutch Shell PLC, is shown in Kailua-Kona.

Alexander & Baldwin Inc., HR BioPetroleum Inc. and Hawaiian Electric Industries subsidiaries Hawaiian Electric Co. and Maui Electric Co. said yesterday they have signed a tentative agreement to build an algae plant on up to 1,000 acres of agricultural land owned by A&B next to HECO's Maalaea power plant starting in 2011.
...
The estimated yield of an algae farm is 6,000 to 10,000 gallons of biodiesel an acre a year, more than the 600 gallons an acre produced from palm or jatropha, or 48 gallons an acre from soy beans, Shonsey said.

Missouri: 15 million gallons of biodiesel per year from animal fat.

St. Joseph’s third biodiesel plant broke ground Wednesday morning on south Stockyards Expressway.

It was only ceremonial; ground preparation work is already done at Terra Bioenergy. Concrete pads are poured for storage tanks and much of the equipment for the refinery is built, waiting to be installed.

The $25 million plant is scheduled to be complete in February. It will employ 25 to 30 people and produce 15 million gallons per year, said David Holcombe, chief executive officer of Terra.

Terra’s plant will primarily use animal fat to produce biodiesel, which can be used in virtually all diesel engines. The animal fat gives Terra an edge over most other operations, which use soybean or vegetable oil, Mr. Holcombe said.

Louisiana: 75 million gallons per year of synthetic fuel from animal fat.

Once in operation, the Geismar plant is expected to produce about 75 million gallons of renewable synthetic fuel annually. The fuel produced by the venture will offer the same benefits of synthetic fuels derived from coal or natural gas while providing substantial performance and environmental advantages over petroleum-based fuels. These benefits include higher cetane levels, which are a measure of combustion quality, and superior thermal stability, making it effective for advanced military applications. In addition, replacing traditional petroleum fuel with this fuel substantially reduces total greenhouse gas emissions.

Unlike the ethanol and bio-diesel industries, which use food ingredients such as corn and soybeans to produce fuel, the Dynamic Fuels project will use various non-food grade animal fats produced or procured by Tyson Foods, such as beef tallow, pork lard, chicken fat and greases.

Iowa: 55 million gallons ethanol per year from corn

The plant in Superior, owned by Green Plains Renewable Energy Inc, produced its first 20,000 gallons of ethanol early Tuesday.

Wayne B. Hoovestol, chief executive officer, told invited media the plant can produce 100 gallons of ethanol a minute at normal speeds.

The plan is to use corn purchased through the Great Plains network as well as from farmers. "It will all be purchased locally," he said.

The local area encompasses a 20-mile radius. It is anticipated the facility will spend $130 million per year to purchase the 18-20 million bushels of corn needed to produce ethanol and its revered byproduct, distillers grain.

Once the ethanol is produced, it will exit the plant on unit trains comprised of 80-90 cars.

Hoovestol said the rail-delivered ethanol will be transported to California, Florida, New York and other locales.
...
Hoovestol said it takes approximately 2 1/2 weeks to fill a train. "We will be producing over one million gallons a week."

Mozambique: 55 million gallons of ethanol per year from sugarcane.

MAPUTO, July 16 (Xinhua) -- The Mozambican government on Tuesday approved a large biofuel project, under which 18,000 hectares in Dombe, in the central province of Manica, will be planted with sugarcane for the production of ethanol.

The project, budgeted at 280 million U.S. dollars, belongs to the company "Mozambique Principle Energy".

Although the government spokesperson, Deputy Education Minister Luis Covane, told reporters that this firm is owned by Mozambican and Mauritian interests, its parent company, Principle Capital, is registered in London, and also has offices in Geneva and Cape Town.

The goal of Principle Energy is to produce 213 million litres of ethanol a year, starting in 2013. This will require a production of 2.5 million tons of sugarcane a year (12,000 tons ofcane per hectare).

This project also includes the production of 82.2 megawatts of energy, starting in 2012. The company itself will use 20 percent of this, and supply the remainder to the national grid.

 

[HoosierRon]

In the United States in June, 1,642 stations were selling E85 in 1,205 cities. On average last month, E85 cost 17.5% less than regular gasoline.

source

 

[eurohazard]

The algae farms seem promising. There's experiments where vertical plates of glass sandwiching thin (but productive) layers of algae generate power. It's clean, and it's easy apparently. Go biofuel.

 

[bobojay]

HoosierRon, keep it coming. Looks like by the end of 2011 timeframe, there's going to be bookoo more biofuel coming versus now!

 

[84jeepjohn]

Man I hope this stuff really takes off, and auto makers will allow NEW cars (personaly chevy and Jeep) to run on 100% bio-diesel.

 

[Bvonscott]

In the United States in June, 1,642 stations were selling E85 in 1,205 cities. On average last month, E85 cost 17.5% less than regular gasoline.

source

While it's 17% less to buy E85, you get 30% less mpg. You can see that on fueleconomy.gov. They need to make it an even discount from reg gas. I.E. 30% for 30%.

 

[Ed Arcuri]

HoosierRon,
I'm with ya.'
How do I get E85 capability in a car I want to buy?
Cheers,
Ed Arcuri

 

[Jimbus]

So what does this all mean? I googled around a bit and found that they are expecting the US to use 9.2 million barrels of oil per day. Assuming 55 gals per barrel and 365 days per year, thats about 185, 000 million gallons a year of which about 72% or about 133,000 million barrels are imported per year. If my numbers are correct, and I won't swear to them, this is a there are a drop in the bucket. And keep this in mind:

- When 3rd world countries say they are planting 18, 000 hectacres (~45K acres), it probably means they are clear cutting rain forest.

- My brother inlaw got $2.40ish for his contracted corn and got over 4 for anything after that last year. That's before all this new capacity. Competitive ethanol prices will come at the expense of higher food prices.

I'm intrigued by the biodiesel possibilities, though. There was an article about a paper mill in park falls, Wi that generating fuel with paper making wasting. I wonder if the animal fat is really waste, though. I don't now about other animal processing processes, but I'd always heard that no part of a cow was waste... maybe it's different for chicken and pigs? Is there a down side to the alga process?

It is good to see people striving and being creative, but I'm not sure any of these are ready or even any better.

 

[TAMark]

So what does this all mean? I googled around a bit and found that they are expecting the US to use 9.2 million barrels of oil per day. Assuming 55 gals per barrel and 365 days per year, thats about 185, 000 million gallons a year of which about 72% or about 133,000 million barrels are imported per year. If my numbers are correct, and I won't swear to them, this is a there are a drop in the bucket. And keep this in mind:

- When 3rd world countries say they are planting 18, 000 hectacres (~45K acres), it probably means they are clear cutting rain forest.

- My brother inlaw got $2.40ish for his contracted corn and got over 4 for anything after that last year. That's before all this new capacity. Competitive ethanol prices will come at the expense of higher food prices.

I'm intrigued by the biodiesel possibilities, though. There was an article about a paper mill in park falls, Wi that generating fuel with paper making wasting. I wonder if the animal fat is really waste, though. I don't now about other animal processing processes, but I'd always heard that no part of a cow was waste... maybe it's different for chicken and pigs? Is there a down side to the alga process?

It is good to see people striving and being creative, but I'm not sure any of these are ready or even any better.

A barrel of oil is more like 42 gallons, not 55. Quit promoting the myth that ethanol is driving food prices up. Pick up the current Car and Driver and read Pat Bedard's column. He's a self admitted ethanol hater but this month lists all the falsehoods about ethanol and food prices.

 

[CJ Thunder]

In the United States in June, 1,642 stations were selling E85 in 1,205 cities. On average last month, E85 cost 17.5% less than regular gasoline.

source

If they didn't make it from corn they had to buy. Would be cheaper. Can't wait for a CTSD.

While it's 17% less to buy E85, you get 30% less mpg. You can see that on fueleconomy.gov. They need to make it an even discount from reg gas. I.E. 30% for 30%.

You should join the "I will not send money to Saudi Arabi" Club...:fall:

 

[plane]

How many 387 million gallons per year biofuel refineries are out there?
Each refinery of that size will take care of 1 day of fuel consumption.

Biofuels are a nice start, but without breathtaking commercial and government investment, we remain far from self-sufficient.

Maybe that's why I like T. Boone Picken's plan so much - Between biofuels, natural gas and electric cars, and all the other potential energy solutions we can develop, we just might become energy independent.

http://www.eia.doe.gov/basics/quickoil.html

 

[HoosierRon]

So what does this all mean? I googled around a bit and found that they are expecting the US to use 9.2 million barrels of oil per day. Assuming 55 gals per barrel and 365 days per year, thats about 185, 000 million gallons a year of which about 72% or about 133,000 million barrels are imported per year. If my numbers are correct, and I won't swear to them, this is a there are a drop in the bucket. And keep this in mind:

A "barrel" of oil has 42 gallons. However, you do not get 42 gallons of gasoline from a barrel of oil. You get 19.5 gallons of gasoline.

Of course these few stories are a drop in the bucket. However, this year the U.S. will produce about 8 billion gallons of ethanol. That displaces about 6-7% of the gasoline we use. We won't make nearly as much biodiesel (about 500 million gallons if I recall), but that displaces even more oil.

The more important point is that the energy source are diversifying. Corn, sugar cane, algae, animal fat. Look in the alternative fuels forum, and you will find a lot of stories about cellulosic plants under construction. And biofuel is no longer is just a Midwestern product. It is being made everywhere.

 

[ptmeyer84]

17% cheaper than gasoline because of government subsidies, take those away and nobody would buy E85 or even E10 for that matter. Ethanol will be a side show, until it becomes cheaper than gasoline.

 

[Michael_S]

So what does this all mean? I googled around a bit and found that they are expecting the US to use 9.2 million barrels of oil per day. Assuming 55 gals per barrel and 365 days per year, thats about 185, 000 million gallons a year of which about 72% or about 133,000 million barrels are imported per year. If my numbers are correct, and I won't swear to them, this is a there are a drop in the bucket.

Gallons of oil per barrel is 42:
http://www.eia.doe.gov/basics/quickoil.html

[EDIT] My numbers were wrong. From that same page above, the US uses 20.687 million barrels of petroleum per day. That puts total use at the equivalent of 317 billion gallons of gasoline per year, not the 141 billion I originally wrote. I'm revising the rest of my post. [/EDIT]

The biodiesel from algae plant listed at the top of HoosierRon's first post claim 6,000 to 10,000 gallons of biodiesel per acre per year (and diesel is more energy dense than gasoline, but I'll ignore that). At 6,000 gallons per acre, and 640 acres per square mile, 82,550 square miles of US land are required for algae production of biodiesel to completely and totally replace all other petroleum sources.

That's 2.2% of the surface area of the US, which seems insane until you figure that at current prices the equivalent of 317 billion gallons of diesel is worth about $1.5 trillion.

If this technology works and is profitable (and I imagine a yield of 6,000 gallons per acre is profitable), then the use could start growing like crazy. A $1.5 trillion potential market - not even counting exports - has got to be very interesting to a lot of people.

 

[Rick_VT]

In the United States in June, 1,642 stations were selling E85 in 1,205 cities. On average last month, E85 cost 17.5% less than regular gasoline.

source

Does anyone know the difference in cost to make ethanol compared to gas?? considering the mix i would have thought ethanol would be more than 17.5% cheaper or is some of that the gas stations doin a bit of profiteering??

 

[HoosierRon]

17% cheaper than gasoline because of government subsidies, take those away and nobody would buy E85 or even E10 for that matter. Ethanol will be a side show, until it becomes cheaper than gasoline.

Will the Jeep Wrangler be a sideshow until it is cheaper than imports? After all, if price is the only reason people choose what they buy, I cannot fathom why anyone would buy a Jeep. Especially if depreciation is taken into account.

And should I assume that you eat ramen noodles morning, noon and night since they are cheaper than any other food out there? Until meat is cheaper than spaghetti, it will remain a sideshow?

In any event, E85 already is cheaper (adjusted for energy content) than gasoline in much of the country. In Minnesota, it is selling for 37% less than gasoline. In South Dakota, it is selling for 34% less.

Illinois - 32% less.
Indiana and Colorado - 31% less.
Massachusetts - 30% less.

What do you think will happen to the price as more and more stations start selling it?

 

[HoosierRon]

Does anyone know the difference in cost to make ethanol compared to gas?? considering the mix i would have thought ethanol would be more than 17.5% cheaper or is some of that the gas stations doin a bit of profiteering??

It is not that simple.

First, remember that there are two separate markets for ethanol: E85 and E10.

The demand for E85 is very elastic because owners of flex fuel cars can easily switch to gasoline if E85 is too expensive. The demand for E10 is less elastic because in much of the country, it is mandated, so refiners have no choice but to buy ethanol to blend into E10.

Now remember that the price of ethanol is set on the open market. Producers offer it and purchasers bid on it. How much will a buyer bid? It depends on the following:

1. If consumers are purchasing E85 at (for example) 15% less than gasoline, but stop buying it if there is only a 10% discount, then producers of E85 know they cannot bid more than 85% the price of gasoline. The bid price of these consumers is dictated by what E85 consumers choose at the pump.

2. Refiners in states where E10 is mandated have to bid whatever it takes to get their ethanol. The demand of these consumers is inelastic.

3. Refiners in states where E10 is not mandated can sit back and choose: if they can get ethanol for less than what it costs to make gasoline, they will bid that much and mix the cheaper ethanol (up to 10%) with the more expensive gasoline. The bid price of these consumers is dictated by the cost to make gasoline, which fluctuates with the price of oil.

All of the foregoing makes for a whole lot of variables. So ethanol producers make all the ethanol they can and sell it as follows:

1. Right now there is more than enough ethanol to fulfill the demand of states with E10 mandates. So producers cannot offer an unlimited price. They lower their prices until the "mandate demand" is filled.

2. Then they keep lowering their price until E85 consumers choose E85 over gasoline. Because people buy E85 for reasons other than price, producers do not need to lower the price of ethanol to 30% less than that of gasoline.

3. If there is ethanol left, the producers lower the price until it cost less than the price to manufacture gasoline, at which point, the rest is purchased by "non-mandate state" refiners.

There is no grand conspiracy here, and the only "subsidy" is the federal government does not tax the companies that blend the ethanol into the gasoline. I am always amazed that people who complain about this really are advocating more taxes.

 

[ptmeyer84]

It is not that simple.

First, remember that there are two separate markets for ethanol: E85 and E10.

The demand for E85 is very elastic because owners of flex fuel cars can easily switch to gasoline if E85 is too expensive. The demand for E10 is less elastic because in much of the country, it is mandated, so refiners have no choice but to buy ethanol to blend into E10.

Now remember that the price of ethanol is set on the open market. Producers offer it and purchasers bid on it. How much will a buyer bid? It depends on the following:

1. If consumers are purchasing E85 at (for example) 15% less than gasoline, but stop buying it if there is only a 10% discount, then producers of E85 know they cannot bid more than 85% the price of gasoline. The bid price of these consumers is dictated by what E85 consumers choose at the pump.

2. Refiners in states where E10 is mandated have to bid whatever it takes to get their ethanol. The demand of these consumers is inelastic.

3. Refiners in states where E10 is not mandated can sit back and choose: if they can get ethanol for less than what it costs to make gasoline, they will bid that much and mix the cheaper ethanol (up to 10%) with the more expensive gasoline. The bid price of these consumers is dictated by the cost to make gasoline, which fluctuates with the price of oil.

All of the foregoing makes for a whole lot of variables. So ethanol producers make all the ethanol they can and sell it as follows:

1. Right now there is more than enough ethanol to fulfill the demand of states with E10 mandates. So producers cannot offer an unlimited price. They lower their prices until the "mandate demand" is filled.

2. Then they keep lowering their price until E85 consumers choose E85 over gasoline. Because people buy E85 for reasons other than price, producers do not need to lower the price of ethanol to 30% less than that of gasoline.

3. If there is ethanol left, the producers lower the price until it cost less than the price to manufacture gasoline, at which point, the rest is purchased by "non-mandate state" refiners.

There is no grand conspiracy here, and the only "subsidy" is the federal government does not tax the companies that blend the ethanol into the gasoline. I am always amazed that people who complain about this really are advocating more taxes.

Do you have a website that I could visit that has good information about these subsidies or lack thereof? I want to believe you but i need some evidence.

 

[MikeB]

The biodiesel from algae plant listed at the top of HoosierRon's first post claim 6,000 to 10,000 gallons of biodiesel per acre per year (and diesel is more energy dense than gasoline, but I'll ignore that). At 6,000 gallons per acre, and 640 acres per square mile, 82,550 square miles of US land are required for algae production of biodiesel to completely and totally replace all other petroleum sources.

That's 2.2% of the surface area of the US, which seems insane until you figure that at current prices the equivalent of 317 billion gallons of diesel is worth about $1.5 trillion.

If this technology works and is profitable (and I imagine a yield of 6,000 gallons per acre is profitable), then the use could start growing like crazy. A $1.5 trillion potential market - not even counting exports - has got to be very interesting to a lot of people.

I agree - algae could be a boon if it all works out!!

 

[RSW]

17% cheaper than gasoline because of government subsidies, take those away and nobody would buy E85 or even E10 for that matter. Ethanol will be a side show, until it becomes cheaper than gasoline.

I would counter-argue that oil and gasoline are also subsidized in a variety of ways (and that that isn't necessarily a bad thing). Even if this were not the case, it is also difficult to put too large a price on energy independence and therefore to argue against subsidies which help us move toward it.

One could also imagine that, without subsidy and barriers, ethanol prices would actually go down because of importation of South American sugar-based ethanol. (I am not advocating this at all but only pointing out that there are at least two sides to what might happen in a more free market.)

Lastly, it may be that ethanol is not the end-all and be-all. Despite rapid growth it may end up as a permanent niche player or may rise to a stable level of 20% of the market for auto fuel. It could fall way off due to other superior technologies and sources, or because of other events. But diversification is per se a good thing.

Wouldn't it be great if, instead of nearly total dependence on foreign oil, we had a mix of ethanol and other biofuels, full-electric (with nuclear, wind, and coal as major inputs to the grid), gas-electric hybrids, and very efficient lightweight diesel and gasoline cars (possibly supplied by our own country's oil supplies)?

Let's not poo-poo ethanol just because tomorrow it won't take over 100% of our needs.