Gills Onions, one of the largest fresh onion producer/ processors in the world, was disposing of 1.5 million pounds of onion waste every week by spreading it as compost across 15,000 acres it farms in Oxnard, Calif. It was an arduous, time-consuming process that cost the company approximately $400,000 annually. Gills had also long-faced two even potentially costlier concerns: high electricity costs (12 to 13 cents per kilowatt hour plus a 15 percent rate hike for 2010) and electricity blackouts. After experiencing a series of blackouts that had jeopardized the extensive refrigeration required to process and protect its fresh-cut onions, the 27-year-old family owned company began to aggressively pursue a long-held desire to convert its onion waste into energy. Determining how to efficiently convert onion waste into methane gas through anaerobic digestion presented a challenge, according to Bill Deaton, president of Deaton &amp; Associates LLC, the Kayenta, Utah, chemical engineering and energy consulting firm retained by Gills to study the concept and develop a plan.&nbsp; &ldquo;It works well at breweries where beer waste is used to run boilers and on dairy farms where manure is converted into fuel. But until Gills decided to try it, no one had used microorganisms to generate digester gas from onion waste before,&rdquo; Deaton says. &nbsp;After testing by Ruihong Zhang at the University of California, Davis confirmed that the sugar content in onion waste was ideal food for methane-producing microbes, Deaton assembled a team of engineers and contractors to develop an efficient waste-to-energy system they named the Advanced Energy Recovery System. In late winter 2009, following a multiyear research and design process, a new energy recovery system went fully on line at Gills, converting the company&rsquo;s onion waste to methane gas that feeds two 300-kilowatt fuel cells. Today this system is offsetting 100 percent of the company&rsquo;s baseload power costs and its expensive waste hauling and disposal operation is no longer necessary. Biogas Production During its fresh cut operations, Gills removes the top, tail and skin, which is roughly 35 to 40 percent of the onion. This waste, generated at a rate of approximately 300,000 pounds daily, now goes through grinding and pressing equipment where 30,000 gallons of onion juice (approximately 75 percent of the total waste) is separated from the solids. The juice is diluted and fed to the energy recovery system&rsquo;s fully automated anaerobic digestion process. Microorganisms in the digester convert the juice&rsquo;s sugar content into methane and carbon dioxide. The remaining leftover solids are sold as high-value cattle feed. In the first step, the onion juice flows to the anaerobic reactor&rsquo;s equalization tank that ensures the influent is pumped to the anaerobic digester at a constant, continuous flow. The equalized water is pumped to a rapid mix tank, where the influent is mixed with a dilution stream and conditioned for efficient anaerobic digestion by adjusting temperature, pH and nutrients (including phosphoric acid and nitrogen). A heating recirculation loop maintains the necessary temperature. From the rapid mix tank, the stream is pumped through a static mixer, which injects ferric chloride and micronutrients into the stream prior to entering the digester. &ldquo;The temperature of the feed flow is between 35 and 40 degrees Celsius (95 to 104 degrees Fahrenheit),&rdquo; Deaton says. &ldquo;To obtain this mesophilic condition, we brought waste heat from other processes in the plant to heat the digester feed.&rdquo; The system&rsquo;s upflow anaerobic sludge blanket (UASB) reactor has a working capacity of 550 cubic meters and a hydraulic retention time of just 29 hours. During this period, anaerobic bacteria within the digester convert the biodegradable onion waste material into methane, carbon dioxide and new biomass. Feed flow from the rapid mix tank splits and enters the bottom of the digester through two feed headers. A proprietary feed distribution-piping system is used in the distribution of the digester feed across the bottom of the digester. The distribution system is specifically designed to create good initial flow distribution of the conditioned onion juice through the sludge bed. The feed flows upwards through the digester. At the top of the reactor, effluent flows over weirs that spill equally into a continuous trough system and combine into a settler drop box. Once collected in the drop box, it exits the digester and flows to a standpipe. An anaerobic effluent composite sampler located in the recycle piping upstream of the rapid mix tank automatically collects samples of the effluent to determine digester performance. Biogas exits the digesters through a gas nozzle at the top of each digester vessel. Excess biomass is periodically removed from the digester and pumped to a tanker truck. Vent gases from the equalization tank, rapid mix tank, digester and standpipe are collected via a vent air blower and purified in a biofilter. One initial challenge the team faced was foaming generated in the sludge bed due to the high protein content of the onion waste. &ldquo;But by making several modifications and changing some of the gas piping, we eliminated the foaming issue,&rdquo; Deaton says. Digester Selection The team selected Biothane to build the specialized reactor to produce the methane. Biothane, a Veolia Water Solutions &amp; Technologies company, is a leading biotechnology company that focuses on highly efficient, cost-effective biological methods to treat wastewater while creating energy and reducing pollution. &ldquo;We liked the idea of the UASB reactor having a sludge bed system rather than a fixed bed,&rdquo; Deaton says. &ldquo;Initially we had considered using a fixed-bed reactor because of the high surface area for the bacteria to form. But after further consideration, we decided we didn&rsquo;t want to deal with the blockage, cleaning, or any of the other issues that can arise with fixed-bed reactors when treating a waste material containing pulp, like diluted onion juice,&rdquo; says Deaton. Biothane&rsquo;s UASB reactor forms a blanket of granular sludge that suspends in the tank.&nbsp; &ldquo;By suspending the bacteria, you can mix the feed with it and get good contact, and you don&rsquo;t have to deal with the problems of the fixed media in the bed. Ultimately, the simplicity of the UASB played a big part in our decision to select it,&rdquo; Deaton says. &ldquo;Plus, there was a lot of engineering we did outside of the reactor&mdash;we transferred waste heat from other processes in the plant with the onion juice, then diluted the onion juice and added micronutrients when necessary.&rdquo;&nbsp; Before the methane could be safely fed into the system&rsquo;s fuel cells, the team had to first overcome a serious obstacle. The methane produced by the feed flow has high sulfur content&mdash;part of what makes onions smell and makes people&rsquo;s eyes water. &ldquo;You can&rsquo;t send high-sulfur gas to these fuel cells because they have very stringent gas quality specifications for displacing natural gas as a fuel source,&rdquo; Deaton says. A grant to fund research by the Gas Technology Institute helped solve the issue. Consequently, the reactor was modified to allow for the collection and conditioning of the biogas. &ldquo;With this modification, the biogas flows from the digester into a conditioning process that purifies, dehumidifies and compresses the gas, making it acceptable for use in these high-efficiency fuel cells,&rdquo; Deaton says. &ldquo;As a result, the system produces about a 70 percent methane gas, which is very high quality for biogas.&rdquo; Fuel Cells=Clean Energy Because Gills wanted an energy recovery system that produces clean heat and electricity, it ruled out engines, combustors or boilers, choosing fuel cells instead. Although relatively new to commercial industry, fuel cells are increasingly being adopted because they generate a highly clean form of energy, run quietly, and produce power and heat at high efficiency. The new energy recovery system at Gills uses two 300-kilowatt fuel cells manufactured by Fuel Cell Energy. The methane produced by the anaerobic digester feeds the fuel cells, which re-form the methane to hydrogen and carbon. The hydrogen and carbon recombines with air in the fuel cells to generate electricity in a classic oxidation/reduction reaction. The end-products are electricity, water and carbon dioxide. The two fuel cells generate enough combined electricity to power the equivalent of 460 homes. &ldquo;A standard power plant runs at about 30 percent efficiency,&rdquo; Deaton says. &ldquo;These fuel cells are currently running at 47 percent efficiency. And, because this is an industrial site, Gills can take advantage of all the heat being generated, too&mdash;using it to heat water, evaporate water, and refrigerate or chill plant water. So, the system is actually running at about 80 percent efficiency and negligible emissions.&rdquo; The emissions avoided by using fuel cells, plus the emissions avoided by not trucking away and land applying the onion waste, yields an approximate 15,000 ton-per-year reduction in the company&rsquo;s carbon emissions. Since the fuel cells are designed to supply base-load power and do not ramp up and down quickly, Gills Onions is able to offset 100 percent of its base-load power costs. Therefore, the company is able to bring the power up and hold it steady 24/7. &ldquo;In a large fresh-cut produce plant like Gills, there are high, around-the-clock refrigeration demands. You don&rsquo;t ever want to lose the cold chain in maintaining fresh onions. This constant demand is now satisfied with the AERS process on-site,&rdquo; Deaton says. Quick Payback, Flexibility Gained The entire project cost $9.5 million. Deaton says the savings of $400,000 a year from eliminating waste hauling, $700,000 a year in deferred electricity costs, plus $2.7 million in incentives for the project from Southern California Gas Co. (as part of the state&rsquo;s Self-Generation Incentive Program) and tax credits should enable Gills to receive a five-year payback. &ldquo;Meanwhile, we&rsquo;re working on another process to take the remaining 25 percent of the waste left after the grinding and pressing process and reduce that by half. This should add another 20 to 50 percent to energy production. When you&rsquo;re offsetting Edison Power at about 12 to 13 cents per kilowatt hour, the payback comes fairly quickly,&rdquo; he says. As the system&rsquo;s project manager, Deaton says he is pleased with what has been accomplished, but he also says the work is not yet finished. Future plans include further reducing the carbon footprint through energy storage, water re-use, and extracting quercetin from the onion waste for use as an anti-oxidant supplement for humans. Authors: Denise Johnston Vice President Marketing and Sales, Biothane LLC <a href="mailto:denise.johnston@veoliawater.com">denise.johnston@veoliawater.com</a> Kristina Gerber Project Manager, Biothane LLC <a href="mailto:kristina.gerber@veoliawater.com">kristina.gerber@veoliawater.com</a> -------- The claims and statements made in this article belong exclusively to the author(s) and do not necessarilyreflect the views of Biomass Power &amp; Thermal or its advertisers. All questions pertaining to this article should be directed to the author(s).

Waste Reduction: At Gills Onions, employees remove the top, tail, and skinâ€”roughly 35 to 40 percentâ€”of the onion, generating some 1.5 million pounds of waste per week. Prior to installing an anaerobic digestion system, Gills had been disposing of

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Energy Juice: The onion juice is diluted and fed to the energy recovery systemâ€™s fully automated biothane UASB reactor.

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Livestock Feed: After the juice has been extracted, the remaining onion solids are further dewatered in a cake press and sold as cattle feed.

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Reactionary: The new energy recovery system at Gills uses two 300-kilowatt fuel cells. The methane produced by the Biothane anaerobic digester feeds the fuel cells, which reform the methane to hydrogen and carbon. The hydrogen and carbon recombines w

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Separation: Onion waste now goes through grinding and pressing equipment where 30,000 gallons of onion juice (approximately 75 percent of the total waste) is separated from the solids. The juice is diluted and fed to the energy recovery systemâ€™s fu

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Gills Onions' new energy recovery system converts about 300,000 pounds per day of onion waste to methane gas that feeds two 300-kilowatt fuel cells. The system is efficiently offsetting all of the company's baseload power costs while reducing carbon 

Onion Processor Uses AD, Fuel  Cells To Convert Waste Into Energy

When USDA put the Biomass Crop Assistance Program on hold in February until the final rules were established, it was anticipated that the program would be back by the end of the summer. As fall approaches, the final rules are still not out and it&rsquo;s unclear when that will happen. Meanwhile, the program freeze has left those who were depending on collection, harvest, storage and transport (CHST) payments, which were being distributed before the program was halted, in sticky financial situations, and others unsure how to budget for 2011 or what crops to plant. BCAP is part of the 2008 Farm Bill and was designed to support the establishment and production of eligible crops for conversion to bioenergy in selected areas, and to assist agricultural and forest landowners and operators in supplying eligible material to biomass conversion facilities. CHST payments, the first of two different types of financial assistance BCAP will offer, provides matching payments to eligible biomass material suppliers in the amount of $1 per $1 paid per ton delivered to a qualified biomass conversion facility&mdash;a facility that will use the material to produce power, heat, biobased products, advanced biofuels or any combination&mdash;up to $45 per dry ton for a time limit of two years after the first payment is made. According to a USDA report released in August, CHST payments dispensed to date total just less than $243 million. The USDA has estimated BCAP spending to total about $2.6 billion, including $2.1 billion for CHST matching payments over the next four years. USDA Farm Service Agency Communications Chief Kent Politsch said that the rules are moving through the approval process, but because there are so many branches of government that have to sign off on them, exactly when they will be ready for release is unpredictable. &ldquo;It could happen in 10 days or a month or more,&rdquo; he said. &ldquo;Some agencies take longer to review it than others.&rdquo; Steve Flick, board president of Centerview, Mo.-based Show Me Energy Cooperative, the first farmer-owned co-op in the U.S. to apply and qualify for BCAP CHST payments, said that the lack of payments, mainly in the past three months, has negatively impacted the co-op. &ldquo;There are two things that have impacted us tremendously in Missouri,&rdquo; Flick said. &ldquo;The shutting off of BCAP, and also extremely wet weather&mdash;since spring, we&rsquo;ve received twice the normal rainfall in western Missouri and there are switchgrass fields under water.&rdquo; Show Me is comprised of more than 600 midwestern farmer-owners. Flick pointed out that while biomass crops such as switchgrass and miscanthus thrive in wet weather, farmers can&rsquo;t get into the fields to bale the biomass energy crops. &ldquo;We don&rsquo;t mind getting rained on, but it&rsquo;s just getting the time to bale, and biomass has to be dry enough to do that,&rdquo; he said. The lack of BCAP rules has also impacted farmers from a crop selection standpoint, Flick said. &ldquo;Farmers need to make some decisions as to what they&rsquo;re going to do with some of their marginal land and sign up for the program within the next month or two. If they don&rsquo;t, they lose a planting cycle. Typically, native grasses can be planted throughout the winter and spring up to July, but after that you have to wait another year. Nobody wants to move until they find out what those rules are.&rdquo;&nbsp; From Flick&rsquo;s perspective, part of Show Me&rsquo;s success stems from getting things rolling before the economic crisis. &ldquo;There is an underlying current of farmers in the U.S. that want to do this [grow energy crops], and the only thing holding them back is capital. We feel lucky to have launched in 2007, because in today&rsquo;s capital-constrained market, I don&rsquo;t think we could be doing what we are doing.&rdquo;&nbsp; Aside from negatives associated with the BCAP freeze, Flick remains very confident in BCAP&rsquo;s success; and in the competence of Farm Service Agency Administrator Jonathan Coppess, in particular. &ldquo;He is going to do a good job&mdash;he&rsquo;s got the vision and aptitude to make it work,&rdquo; he said. &ldquo;He&rsquo;s the right man to do that job, and it&rsquo;s not easy.&rdquo; Coppess was appointed to serve as administrator of the FSA in July 2009, having previously served as the deputy administrator for farm programs at the agency. &ldquo;They know they need to roll [BCAP rules] out, and they&rsquo;re doing an awful good job of trying to go through 24,000 comments, which is a tremendous undertaking,&rdquo; Flick said. &ldquo;I really think their contention is to make absolutely sure we don&rsquo;t have any more debacles like we did last time.&rdquo; The proposed BCAP rules contained several loopholes and oversights that prompted the program freeze. One example is the CHST qualification of certain materials that the pulp and particleboard/fiberboard manufacturers utilize such as bark, sawdust and shavings, which increased the cost of materials for that industry. The final rule aims to fix that problem and others. Until then, it&rsquo;s a waiting game. &ldquo;We&rsquo;re very anxious because we feel that this is a good program for farmers,&rdquo; Flick said. &ldquo;It&rsquo;s our destiny as a country to reduce our dependence on foreign oil, and I don&rsquo;t care if it&rsquo;s liquid fuel or power, BCAP is the way to get started,&rdquo; Flick said.

Mover and Shaker: Show Me Energy was the first to apply and qualify for the USDA\\\'s Biomass Crop Assistance Program. Now members are waiting for the program to be reinstated and their CHST payments to resume.

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Biomass industry anxious for BCAP final rule

I am pleased to announce that Biomass Magazine is now Biomass Power &amp; Thermal. Although it may look like a subtle change on the magazine cover, it is an important transformation in content. As the new title implies, we will strictly cover biomass-based electricity and heat. Historically this magazine also reported on biomass fuels and chemicals, however these topics are now the dedicated the focus of BBI International&rsquo;s new publication <a href="http://www.biorefiningmagazine.com" target="_blank">Biorefining</a>. The magazine's title and scope were changed because biomass involves a vast array of feedstocks and technologies and we want to provide readers with ample coverage of all aspects of the industry. It also allows readers and advertisers to hone in on their area of expertise, whether its biomass power, heat, fuels or chemicals.&nbsp; Specifically, it allows the staff of Biomass Power &amp; Thermal to drill even deeper into every facet of biomass power and thermal including producers, feedstocks, technologies, research and development, project development, transportation and storage logistics, state and local legislation, advocacy groups, businesses and people. When we first started the magazine three years ago, we quickly realized that other than the feedstocks they use, there is a vast divide between the power and thermal, and biofuel and chemical spheres. The most obvious being the prolonged existence of the use of biomass for heat and power versus the nascent biofuels and biochemical industries. There are also a myriad of state and federal rules and regulations, programs and funding opportunities, and environmental challenges that affect all users of biomass that deserve more concentrated coverage. While these industries are forced to compete for attention and funding from state and federal governments, we wanted to make sure they didn&rsquo;t have to fight for space in our publications.&nbsp; As our mission statement establishes: Biomass Power &amp; Thermal&rsquo;s international readership includes owners and managers of biomass power, combined heat and power, and district heating facilities; pellet manufacturing plant owners and managers; professionals working in captive feedstock industries&mdash;from food processing and waste management to agriculture and forest products manufacturing&mdash;and a growing number of industrial manufacturers, municipal decision makers, researchers, and technology providers engaged in biomass utilization globally. As a reader, I would see this as a sign that BBI International is confident in the use of biomass as a substitute for fossil fuels and that all of these industries will continue to flourish. The space below this column will be used to showcase associate editors, contributors or for letters to the editor. This week we are highlighting our associate editors.

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I am pleased to announce that Biomass Magazine is now Biomass Power &amp; Thermal. Although it may look like a subtle change on the magazine cover, it is an important transformation in content. As the  . . .

Zeroing in on Power and Thermal

The power industry is second only to agriculture as the largest domestic user of water, accounting for 39 percent of all freshwater withdrawals in the nation, of which 71 percent is used in fossil fuel-based electrical generation. The same technologies used to produce electricity from fossil-based fuels are, and will continue to be, used for a significant amount of biomass-based power production.&nbsp; Much of the water used for power generation, including biomass power generation, is consumed in the condensing step of the system where the steam exiting the turbine is cooled and condensed back to water. This water is sent back to the boiler for reconversion to steam to spin the generator to produce electricity. This steam is in a closed loop and has small losses from venting of steam and blowdown of water in the steam cycle to reduce impurities in the steam system. It is in the cooling loop, separate from the steam system, where water is used to condense the steam which has the most significant losses. The water in this loop is cooled by evaporation in large cooling towers to cool the water that is then used to condense the steam. The availability of water for use in biomass electric power generation is limited in many parts of the United States, and biomass power plants must compete with other industrial customers, agricultural interests and households for this limited commodity.&nbsp;&nbsp;&nbsp; Therefore, water is an important factor in obtaining site permits for new biomass power plant construction. Difficulty in obtaining necessary water permits can lead to delayed or abandoned projects. Also, it is often the case that additional infrastructure is required to provide a suitable supply, adding cost and environmental impact. In areas that do not have an adequate water source, biomass power plant construction is often not even considered, even though these locations are ideal in other respects. In addition, potential regulations curtailing CO2 emissions will impact water use. Because of the corrosive nature of carbonic acid, water will need to be removed to low levels prior to pipelining the CO2 to its final destination. The EERC in conjunction with a commercial partner investigated a unique technology aimed at reducing the water use in power production systems that has many potential applications. This technology is a liquid desiccant dehumidification system (LDDS). The LDDS is an absorption-based system designed to recover moisture from process gas streams. This gas may be the effluent from an ethanol process, the exhaust from a biomass power generation system or any other moisture-rich gas stream.&nbsp; The LDDS concept has several features that make it potentially attractive for integration with a biomass utilization process: &bull; The desiccant solution separates the process gas and moisture condensation space. In this respect, the LDDS performs a similar function to a water-selective membrane, but it is more robust and can resist fouling in harsh gas environments. &bull; The LDDS produces high-quality product water without additional treatment. &bull; The LDDS does not completely cool the process gas stream, which is an important consideration if the gas is to be exhausted to a stack. This is just one example where the EERC can play a part in cooperation with the biomass industry to provide value-added services and processes. The EERC is committed to reducing the water footprint of biomass utilization systems, whether it is in power production or in the production of bioproducts or biofuels, and is working with industry to do so. Author: Bruce Folkedahl Senior Research Manager, Energy &amp; Environmental Research Center (701) 777-5243 <a href="mailto:bfolkedahl@undeerc.org">bfolkedahl@undeerc.org</a> &nbsp;

Bruce Folkedahl
Senior Research Manager, 
Energy & Environmental Research Center

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The power industry is second only to agriculture as the largest domestic user of water, accounting for 39 percent of all freshwater withdrawals in the nation, of which 71 percent is used in fossil fue  . . .

ENERGY REVIEW: Reducing Water Usage  in Biopower Production 

A lack of financing for biomass projects is a common lament for most biomass developers. As many developers already know, new market tax credit financing is a great way to obtain financing at better than market rates for biomass projects, if you can get the attention of a small group of banks with interest. Fortunately, a recent taxpayer-friendly ruling by the IRS creates new opportunities to attract individual investors to serve as the tax credit investor.&nbsp; Background The new market tax credit program was created more than a decade ago as a way to direct funds to businesses located in low-income census districts. The program provides an investor with a federal income tax credit equal to 39 percent of an investment in an intermediary entity (referred to as a community development entity), which loans the investor's fund to the biomass project. This loan must be interest-only for at least seven years and have an interest rate at least 25 percent below a market rate. Under certain structures, a lender typically will discharge a substantial portion of the principal after seven years (after all, the lender has recouped its investment from the generous 39 percent tax credit and often doesn't also need a return of all of the principal).&nbsp;&nbsp;&nbsp; A biomass project will qualify for this financing as long as the project is located in a low-income census district. A liberal definition of "low-income" covers almost 40 percent of the United States, including many rural districts. A federal website mapping feature identifies whether an address is in a low-income census district (<a href="http://www.cdfifund.gov/what_we_do/mapping.asp">www.cdfifund.gov/what_we_do/mapping.asp</a>). New market tax credit financing can also be coupled with traditional waste-to-energy financing, such as the production tax credit (PTC), investment tax credit (ITC), or the federal 1603 grant.&nbsp; Current Tax Credit Problems To state the obvious, the tax credit appetite of banks has declined sharply in recent years. Nonetheless, there are still plenty of individual investors who are interested in offsetting taxable income. Until now, individual investors have shied away from investing in new market tax credits, because it has been assumed that these credits were subject to the restrictive passive activity tax limits (as is the case with the PTC and ITC), which limits the use of these credits for most individuals.&nbsp; IRS Ruling In a June 2010 ruling, the IRS clarified that new market tax credits are not subject to these passive activity rules. This ruling creates opportunities for project developers to raise funds by finding one (or likely multiple) individual investors who could serve as new market tax credit investors. From the perspective of an individual investor, the return on a new market credit investment is comparable to a market-rate loan, but with a portion of the return coming in the form of tax credits. An individual investor's evaluation of this return would not be conceptually dissimilar from the way in which he or she would approach tax-exempt municipal bonds (i.e., the return should be calculated on an after-tax basis). While the task of finding financing for a biomass project is still not easy, this recent ruling at least opens new financing sources for a developer. &nbsp; Author: Hamang Patel Attorney, Michael Best &amp; Friedrich LLP (608) 283-2278 <a href="mailto:hbpatel@michaelbest.com">hbpatel@michaelbest.com</a>

Hamang Patel
Attorney, Michael Best & Friedrich LLP

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A lack of financing for biomass projects is a common lament for most biomass developers. As many developers already know, new market tax credit financing is a great way to obtain financing at better t  . . .

LEGAL PERSPECTIVES: New Possibilities in the Hunt  for Biomass Project Financing

Biomass Power Association has been busy articulating to various state and federal agencies that certain proposed laws would harm the biomass industry, the larger renewable energy sector and the nation. There have been countless misunderstandings that have resulted in potentially damaging environment rulings proposed to regulate biomass power. As president of BPA, I have been working hard to represent our members&rsquo; best interests in the sometimes fierce battles with government agencies that have their states&rsquo; best intentions in mind but do not understand biomass or &ldquo;biomass done right.&rdquo; These agencies do not understand the implications their laws may have on a growing industry that contributes so much to the country, and it is of the utmost importance that we explain to them the harm these rulings will cause. BPA submitted comments to two government agencies&mdash;one federal and one state&mdash;to help clarify the misconceptions surrounding our industry. In both cases, BPA is fighting on behalf of not only biomass, but the entire renewable energy industry. Most people are surprised to learn that biomass supplies more than 50 percent of the nation&rsquo;s renewable energy supply. In August, BPA submitted comments to Massachusetts Department of Energy Resources, the agency in charge of the environment, because the DOER misinterpreted the Manomet Center for Conservation Sciences report and used it as the basis for&nbsp; a proposed rule that would greatly increase efficiency criteria for biomass facilities. Complicating matters, the agency endeavored to circumvent normal procedure that prevented Massachusetts residents from expressing their civic right to weigh in on this issue. The comments we submitted to DOER questioned the proposed rule itself and the process by which the rule is being considered. Our comments clarified that biomass done right works and explained why the Manomet report did not provide a clear picture of biomass and its actual emissions: &ldquo;Fundamentally, all of Secretary [Ian] Bowles&rsquo; regulatory directives are misplaced and inappropriate for a simple reason: the Manomet study has absolutely nothing to do with the way that biomass energy is produced, or likely to be produced, anywhere in New England. Quite simply, Secretary Bowles took the results of the study to suggest sweeping changes in the RPS without listening to the very authors of Manomet who, immediately after issuing the report, made clear that it was not a study of nonforest harvested biomass &hellip; In other words, the very authors of the study that the commonwealth is now relying upon to regulate all biomass make clear that their results are not relevant for all biomass.&rdquo; BPA also submitted comments in August to the U.S. EPA in response to their proposed Boiler MACT rule, which would all but cease biomass production across the country by making emissions standards unattainable and unrealistic. We agreed that measures must be taken to protect public health and the health of the forests, but pointed out that the Boiler MACT rule was not the way to go about this. Rather, we suggested, EPA should consider tailored emissions standards for each industry based on an evaluation of specific criteria, such as types of boilers and fuels: "In light of the overwhelming support for biomass from every corner of government, it is imperative that EPA adopt a rule that is protective of the public health and the environment while also allowing this critically important energy source to be fully utilized. We are concerned that the proposed rules will impose tens of billions of dollars in capital costs at thousands of facilities across the country. Thus, we ask EPA to consider flexible approaches that appropriately address the diversity of boilers, operations, sectors and fuels that could prevent severe job losses and billions of dollars in unnecessary regulatory costs." In both instances, the biomass industry stepped up to the plate to educate the uninitiated about what we do. And we must continue to do so when false accusations emerge. As many forms of renewable technology remain in their infancy, or even adolescence, biomass is a mature renewable energy source that is critical to meeting the nation&rsquo;s ambitious clean energy goals. I truly believe we are making progress and hope that the two government agencies considering stricter biomass rules will make the right decision. Author: Bob Cleaves President and CEO, Biomass Power Association <a href="http://www.USABiomass.org">www.USABiomass.org</a>

Bob Cleaves
President and CEO, Biomass Power Association

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Biomass Power Association has been busy articulating to various state and federal agencies that certain proposed laws would harm the biomass industry, the larger renewable energy sector and the nation  . . .

POWER PLATFORM: Biomass Industry Pushes Back  Against Potentially Harmful Laws

1. Former US Ag Secretary joins Bion Bion Environmental Technologies Inc. announced that Ed Schafer, former governor of North Dakota and former secretary of the USDA, has agreed to join Bion&rsquo;s management team through the end of 2013. Schafer will provide Bion with strategic advice, focusing on areas of public policy related to the livestock industry both domestically and internationally. In addition to his public sector experience, he has successfully led a multi-national consumer products business and several entrepreneurial start-up companies. 2. James River Equipment joins Morbark family James River Equipment, specializing in heavy equipment sales, service and parts, is now the authorized dealer of Morbark industrial equipment in all of Virginia and North Carolina and two counties in South Carolina. In business for more than 30 years, James River Equipment has 25 locations throughout Virginia, North Carolina, and South Carolina. They sell and service a full range of equipment in many industries including construction, forestry, paving, mining, agricultural, and consumer and commercial lawn care. 3. Renewables specialist Consense scoops top national award Consense, which specializes in providing online consultation for the renewables sector, won the SME Innovation award at the National eWell-Being Awards 2010 and was selected by the judges as the overall winner of this year&rsquo;s awards (beating more than 42 finalists across nine categories). Consense won for its Open Debate online consultation system which enables much wider community consultation and engagement for proposed renewable energy developments.&nbsp; 4. Track chipper redesign melds comfort with power With the recent redesign of the Bandit Model 3090 Track Chipper, land clearing contractors and loggers now have power and productivity without sacrificing operator comfort. Key upgrades to this 30-inch capacity chipper include a spacious operator&rsquo;s cab with a rear entry door, an emergency escape door on the left and a pop-out escape window on the right. Convenient joystick controls operate all functions of the machine; from the loader&rsquo;s main and jib boom movement, to the engine controls and feed system. Optional monitors provide a view of the discharge and infeed system from the operator&rsquo;s cab. 5. Anguil Environmental launches new website Anguil Environmental Systems Inc. launched a new interactive website that further defines its position as a pollution control thought leader and information resource for clients. The fully redesigned website, http://anguil.com, focuses on information efficiency, quality content and effortless navigation. Anguil Environmental Systems case studies are now searchable by the 16 different industries they serve. 6. B&amp;W subsidiary DPS to provide O&amp;M services for Georgia biomass plant Delta Power Services LLC, a wholly owned subsidiary of Babcock &amp; Wilcox Power Generation Group Inc., has signed a multiyear, renewable contract to provide operations and maintenance services for Rollcast Energy's Piedmont Green Power biomass energy project in Barnesville, Ga. B&amp;W PGG is a subsidiary of The Babcock &amp; Wilcox Co. The 53.5 megawatt Piedmont Green Power plant is scheduled to go online in 2012. DPS will provide a variety of services for the facility both during construction and after the plant is operational, including selecting the site staff, managing day-to-day plant operations, performing equipment maintenance and repair services, and administering project contracts. 7. BinMaster improves high temp vibrating rods &nbsp;The BinMaster Super High Temperature vibrating rod features a newly developed piezo system built specifically for higher process temperatures up to 482 degrees Fahrenheit (250 degrees Celsius). The SHT&rsquo;s patented re-enforced membrane and the new piezo system features a standard insulation tube that insulates the electronics from excessive heat. The entire probe is constructed of stainless steel, and the electronics are mounted inside an IP66 /IP67 aluminum enclosure for advanced protection. The SHT can be used in all kinds of powdered or granular solids from light, fluffy materials with a minimum material density of 1 to one-fourth pounds per cubic foot (20 grams per liter) to a maximum granular size of 1 to one-half inch (40 millimeters).
 8. John Deere launches educational woody biomass website John Deere Construction &amp; Forestry has launched a woody biomass website (www.woodybiomass.com) designed to educate and inform about the importance of harvesting woody biomass. The user-friendly website explains what woody biomass is, why harvesting it is important, how it works as a fuel and what types of innovative public policies are needed to encourage responsible harvesting and the use of woody biomass. 9. Vermeer launches multilingual, multimedia website To better connect with customers worldwide, Vermeer Corp. has launched a new multilingual and multimedia website designed to provide easy access to product and market-specific industry information. The redesigned Vermeer.com site provides detailed information on the current line of Vermeer products. The redesigned site can serve as an industry resource, providing information on market trends, equipment maintenance and operational tips, as well as customer case studies. Visitors to the site will also have the opportunity to download popular software applications developed by Vermeer. Video demonstrating Vermeer products working in the field are prominent throughout the site, helping to provide customers with a better idea of how these products can fit into their operation.&nbsp; 10. Nexterra recognized for best application of technology Nexterra Systems Corp. announced that it has received the Best Application of Technology Award from the British Columbia Technology Industry Association. This award recognizes Nexterra&rsquo;s biomass gasification system at Kruger Products LP&rsquo;s new Westminster tissue mill. The system converts wood residue into clean-burning syngas that is being fired directly into a boiler to generate 40,000 pounds per hour of process steam. The project will displace about 400,000 gigajoules of natural gas per year and reduce greenhouse gas emissions by 20,000 metric tons annually, which is equivalent to taking 5,500 cars off the road. 11.Capstone C1000 Series receives UL certification Capstone Turbine Corp., a manufacturer of microturbine energy systems, announced that it has received Underwriters Laboratories certification for its C1000 Series products in accordance with UL 2200 and UL 1741. The C1000 is a compact and robust 1 megawatt power system that provides the same low emissions, low noise, high efficiency and extended maintenance benefits of Capstone's C30, C65 and C200 offerings. It features Capstone's patented air bearing, remote monitoring and diagnostic capabilities and integrated utility synchronization and protection. 12. Clyde Bergemann to provide boiler cleaning systems for UK plant Von Roll Inova, the Swiss subsidiary of A-TEC INDUSTRIES AG conglomerate, has awarded Germany-based Clyde Bergemann Power Group with the turnkey delivery of three SCS Shower Cleaning Systems to be installed in the 72-megawatt Riverside facility in Great Britain. The SCS systems will be equipped to clean second and third open pass of all three combustion lines. Each combustion line processes 31.8 metric tons of municipal and commercial waste per hour to generate enough electricity to serve roughly 66,000 households. 13. DP CleanTech expands in Thailand After successfully completing 18 biomass power plant projects in less than four years in China, DP CleanTech has identified Thailand as the next major market in its rapid roll-out of biomass power systems in Southeast Asia. In July, DP CleanTech opened a sales office in Bangkok, marking another milestone in its expansion strategy for biomass power in Southeast Asia. Thailand&rsquo;s abundant resources coupled with its accommodative renewable energy policies represent an opportunity for further biomass development and a priority market for DP CleanTech.

4. Sweet Ride: Bandit Industries Inc. has redesigned its track chipper with an eye toward the operatorâ€™s comfort and productivity needs.

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12. Squeaky Clean: Clyde Bergemannâ€™s SCS Shower Cleaning Systems will be installed in the Riverside plant in Great Britain.

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8. Learning Experience: John Deere launched a new user-friendly website that helps educate and inform visitors about woody biomass.

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Business Briefs: People, Products & Partnerships

1. Sierra Pacific shuts down Loyalton plant Sierra Pacific Industries has shut down its Loyalton, Calif., biomass power plant because of reduced timber sale offerings making it impossible to operate, along with decreased electricity rates. Numerous government actions, including decisions not to implement laws passed by Congress, have cut off the company from feasible fuel supplies, it said. In addition, Nevada Energy recently lowered the rates it pays to SPI for electricity generated from the Loyalton plant. The combination of the two factors made the facility uneconomic to run, according to the company. Those events, notwithstanding, SPI is exploring opportunities that might allow it to reopen the facility, it said. 2. MSU launches farmer network Kentucky&rsquo;s Murray State University, with the help of Memphis AgBioworks, has launched its West Kentucky AgBioworks initiative to implement the results of a five-state, 98-county study by Batelle Technology Partnership Practice. The study concluded there is significant opportunity for the Mississippi Delta to join the global bioeconomy. The initiative will aim to educate farmers on growing and testing alternative crops; to start an MSU demonstration crop; and to survey businesses in the region with a goal of determining who can use biomass and build processing plants. The program has received tens of thousands in funding already, including $50,000 from state agencies and $12,000 from participating counties, according to MSU. 3. Detroit Edison gets approval for power projects The Michigan Public Service Commission has approved two contracts totaling 20 megawatts (MW) of capacity, enough to power about 14,000 homes, to be sold to power utility Detroit Edison. Through the contracts, Waste Management Renewable Energy will provide 3 MW of power from a landfill gas project, and L&rsquo;Anse Warden Electric Co. will provide 17 MW from a wood waste biomass plant in Baraga County, Mich. Detroit Edison serves about 2.1 million customers in southeastern Michigan and expects to add 1,200 MW of renewable power to its capacity. 4. Enviva expands through acquisition Enviva LP, a manufacturer of wood pellets and processed biomass fuel, has acquired Amory, Miss.-based wood pellet manufacturer CKS Energy. CKS provides pellets for industrial, commercial and residential customers, mainly in Europe where wood pellets are well-integrated into the energy sector. In the coming months, Enviva plans to hire additional staff for the CKS facility, which will be known as Enviva Pellets Amory. The company will also expand its production from current capacity of 50,000 tons per year to more than 100,000 tons per year, according to Enviva. Raw biomass material will be sourced locally and the facility will primarily serve Enviva&rsquo;s long-term European customers. Enviva Chairman and CEO John Keppler called the acquisition a perfect fit as the company moves to increase its manufacturing footprint. 5. White Technology, partners receive biomass project grant Indiana-based White Technology LLC has been selected along with its partners at West Virginia University to receive one of six renewable energy grants awarded by the West Virginia Division of Energy. The grant will fund a project that will demonstrate the environmental and economic benefits of reclaiming former mine land properties with sustainable and viable agricultural biomass for future renewable energy production. White Technology has an exclusive license for a Miscanthus giganteus and Arundo donax (giant reed) micropropagation technology developed by University of South Carolina plant geneticists. 6. Helius Energy secures site for new biomass plant Biomass energy developer Helius Energy plc announced it has signed an option to lease a 20-acre site at the Port of South Hampton, U.K., for the construction of a 100-megawatt biomass power plant. The option to lease the site from Associated British Ports is subject to the securing of a Development Consent Order, which Helius intends to submit an application for in the near future, and the company will soon enter into consultation with the local community and relevant statutory authorities. Helius anticipates that the plant will require about 700,000 metric tons (771,000 tons) of biomass per year, a significant proportion of which will come through the Port of South Hampton. 7. Washington DNR requests proposalsfor forest biomass study The Washington Department of Natural Resources has released a request for proposals to assess forest biomass availability and sustainability harvest thresholds on forested land throughout the state for biofuel, heat and power generation purposes. The study is required by House Bill 2165, which was enacted into law in 2009 and allows the DNR to implement biomass energy projects using forest biomass in eastern and western Washington through the authorization of long-term supply agreements. The deadline for the request for proposals was Sept. 13. The DNR anticipates beginning the study in early November. 8. Aspen secures funding for plant Aspen Power LLC has acquired the necessary funding to complete construction of its 57-megawatt (MW) biomass power plant in Lufkin, Texas, which began in late 2008. Akeida Capital Management LLC provided Aspen with a $14.1 million junior loan to complete the waste wood-fired plant, the first biomass plant to be built in Texas, according to Akeida. Aspen Power&rsquo;s sister company, Angelina Fuels, will provide the plant with about 1,500 tons of biomass per day from timber harvesting, sawmill and municipal cleanup activities in and around Lufkin. The facility will create 50 new jobs for locals and contribute to Texas&rsquo; renewable portfolio standard of 10,000 MW by 2020 with at least 500 MW generated from nonwind resources. Aspen Power will interconnect to the Electric Reliability Council of Texas.

5. Energy Crops: White Technologies has an exclusive license for micropropagation technologies for energy crops such as Miscanthus Giganteus.

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8. Investment Opportunity: Akeida Capital Management provided Aspen Power LLC with the funding necessary for it to complete the construction of its Texas plant. 

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4. Pellet Power: Enviva LP has acquired CKS Energy, a pellet plant in Armory, Miss., and plans to more than double its production capacity. 

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Biobytes: Biomass News Briefs

A recent dip into the U.S. DOE&rsquo;s Loan Guarantee Program funding has renewable energy groups feeling neglected as it is the second time funding has been &ldquo;borrowed&rdquo; for other purposes, the first amount still was not repaid. President Barack Obama signed legislation that would allow a trimming of $1.5 billion for funding of emergency assistance to various states. A package containing the measure has passed in the House, but is waiting on Senate action. A letter to Speaker of the House Nancy Pelosi, D-Calif., outlining the detriments of such a measure was signed by representatives from the American Wind Energy Association, the Geothermal Energy Association, the National Hydropower Association, the Solar Energy Industries Association and the Biomass Power Association. &ldquo;This reduction in funding severely limits the DOE&rsquo;s ability to support the suite of renewable resources through the loan guarantee program,&rdquo; the letter reads. &ldquo;Further, a solicitation for manufacturers of commercial renewable energy technologies has not even been released yet by DOE. The proposed cut makes it likely that manufacturers of commercial renewable technologies will not be able to take advantage of the DOE Loan Guarantee Program.&rdquo; &nbsp;In 2009, funding was cut from the program for the Cash for Clunkers program. A total of $2 billion was trimmed from the $6 billion allocated in the American Recovery and Reinvestment Act to provide loan guarantees for an estimate $60 billion worth of renewable energy projects. With the latest rescission, $3.5 billion will have been cut from the program and many projects will go unfunded, the letter states.

Renewable energy groups oppose  Loan Guarantee Program cuts

A study commissioned by the Council of Industrial Boiler Owners found that implementation of the U.S. EPA&rsquo;s proposed Boiler MACT rule as is would result in substantial job loss, as well as reduced U.S. gross domestic product. The rule would strictly limit emissions of five hazardous air pollutants (HAPs)&mdash;mercury, hydrogen chloride, particulate matter, carbon monoxide and dioxin/furans&mdash;for industrial, commercial and institutional incinerators, boilers and process heaters, including those using&nbsp; biomass. Under the proposed rule, sources emitting 10 MMBtu per hour and greater will be required to comply with numerical emission limits for those pollutants. In addition, many biomass boilers formerly categorized as multifuel boilers and not subject to the limits would fall under the incinerators category and would be required to adhere to them. The new CIBO study, The Economic Impact of Proposed EPA Boiler/Process Heater MACT Rule on Industrial, Commercial, and Institutional Boiler and Process Heater Operators, found that for every $1 billion spent on MACT upgrade and compliance costs, 16,000 jobs will be put at risk and the GDP could be reduced by as much as $1.2 billion. Much of that pain would be suffered in supplier networks, it adds.&nbsp; Biomass Power Association president and CEO Bob Cleaves has been warning of the monetary expense and job loss dangers of the proposed rule since its release in June, saying it would require costly retrofits at almost 100 percent of existing biomass power plants. &ldquo;The Biomass Power Association has repeatedly emphasized that the EPA&rsquo;s proposed MACT ruling will cause the loss of thousands of jobs across America in an already troubled economy,&rdquo; Cleaves said. &ldquo;The Council of Industrial Boiler Owners is buttressing our views with its report on the potential effect of the MACT rule on jobs. We ask again that the EPA review its proposed ruling on biomass boiler emissions to consider what is at stake environmentally and economically for Americans.&rdquo; Cleaves has charged that the limits are unachievable and would devastate the biomass industry. According to the CIBO study, biomass won&rsquo;t be the only industry hit. &ldquo;The Council of Industrial Boiler Operators believes its members may be subject to significant economic hardship should the proposed EPA rules regulating boiler emissions be adopted,&rdquo; it reads. &ldquo;Potential consequences include the shuttering of domestic manufacturing capacity&mdash;and the associated jobs losses&mdash;for those CIBO members that find the capital costs associated with compliance via plant retrofitting make it economically unfeasible to continue operations.&rdquo; The study was conducted by economic forecasting firm IHS Global Insight and quantifies the economic impact of compliance to the proposed standards by all impacted sources. Upgrades alone for all the proposed standards would cost the country more than 337,000 jobs, the study forecast, and $5.7 billion in taxes. &ldquo;The study released today (Sept. 15) by CIBO is but further evidence that excessive regulation would result in lost jobs&mdash;and those jobs won&rsquo;t come back,&rdquo; said American Forest &amp; Paper Association president and CEO Donna Harman, adding that AF&amp;PA commissioned its own study released in August that also showed significant job loss forecasts. &ldquo;The CIBO study, much like the jobs impact study AF&amp;PA released, shows disturbing job losses that can still be avoided as the rule is being considered by EPA.&rdquo; The comment period on the proposed MACT rule ended Sept. 14 and the rule should be finalized by Dec. 16 of this year. &ldquo;Policymakers are rightly saying that we need to preserve and create more American manufacturing jobs today,&rdquo; Harman said. &ldquo;This proposed Boiler MACT rule overshoots the mark and would result in Americans being put out of work. EPA has a choice&mdash;they can regulate in a way that protects both jobs and the environment, or they can regulate in a way that sacrifices jobs.&rdquo;
&nbsp;
[ON THE WEB: CIBO study: <a href="http://www.cibo.org" target="_blank">www.cibo.org</a>]

BPA President and CEO Bob Cleaves maintains that emissions limits in the proposed Boiler MACT are impossible to achieve.

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AF&PA President and CEO Donna Harman says the CIBO study is further proof that the Boiler MACT proposed rules would result in job losses.  

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Study: Proposed Boiler MACT means significant job loss

A Colorado State University professor is developing an anaerobic digester (AD) that uses less water than conventional systems, making it ideal and economically feasible for use at feedlots and dairies in the Western states. Sybil Sharvelle, assistant professor of engineering, said her process is separated into stages, beginning with water trickling over the solids and converting the organic material into liquid organic acids. The acids are then converted to methane in a separate high-rate digestion reactor. Sharvelle has experimented mainly with animal waste, but said the process is appropriate for any waste with solids content of more than 40 percent. &ldquo;Aside from manure, we are also testing the reactor for conversion of the organic fraction of municipal solid waste to methane,&rdquo; she said. The amount of water saved varies depending on the quality of the feedstock, she added. &ldquo;This technology is very beneficial in the arid West where water is a precious resource and also has a high dollar value,&rdquo; Sharvelle said. &ldquo;Agricultural producers in the West work hard to conserve water because they are often limited by water rights or have a financial benefit to do so.&rdquo; The water required for conventional AD technology generally renders it economically unfeasible, she added. &ldquo;The lower water requirement for the system we are developing will enable agricultural producers in arid climates to generate revenue through installation of the technology.&rdquo; Sharvelle and graduate student Luke Loetscher are collaborating with Fort Collins, Colo.-based Stewart Environmental Consultants Inc. and the university&rsquo;s Agricultural Experiment Stations to evaluate the feasibility of AD at Colorado feeding operations, according to the university. The system is currently operating on a laboratory scale, but construction of a pilot plant is underway at a Colorado feedlot. The pilot will operate over the next year, followed by construction of large operations in the second year and full commercialization in three years, according to Sharvelle. Stewart Energy, a wholly owned subsidiary of Stewart Environmental Consultants Inc., is working to commercialize the process and has an exclusive option to license it from the Colorado State University Research Foundation.

CSU professor develops water-saving AD process

Over the next year, researchers at the Energy &amp; Environmental Research Center at the University of North Dakota will test multiple types of high-moisture feedstocks during a demonstration of the partnership between its gasifier and a Cummins Power Generation Inc. generator. The design and operation of EERC&rsquo;s proprietary gasification system allow for feedstocks with higher moisture content than traditional systems, according to Nikhil Patel, EERC research scientist. In the process, the moisture in the biomass is used to improve the hydrogen content of the resulting syngas, he added. Feedstocks used in the demonstration will include municipal solid waste, wet wood, turkey litter and other opportunistic biomass fuels that are underutilized, according Bruce Folkedahl, EERC senior research manager. &ldquo;High-moisture biomass is a typically found fuel,&rdquo; Patel said. Cummins, based in Minneapolis, is a worldwide leader in internal combustion engines and stationary power generation, and thus is an ideal partner for this research. &ldquo;The partnership is beneficial to both entities and will advance the state-of-the-art in both distributed gasification and syngas use in internal combustion engine power generation,&rdquo; Folkedahl said. The Cummins generator normally runs on natural gas, but has been fitted for syngas by EERC researchers. The demonstration of the technologies together will produce between 20 and 40 kilowatts (kW) of electricity, which will be used to power a heater. &ldquo;The ultimate goal of the project is to implement commercial projects,&rdquo; Patel said. Scale-up of the system will be based on the particular use of the technology and will vary from the current size up to 500 kW or larger. &ldquo;Some applications may only require 50 kW while others may need more depending on the end use of the electricity and the amount of biomass available for fuel,&rdquo; Folkedahl said. The EERC hopes the outcome of the project will lead to further development and the demonstration of engine performance when using syngas. It will produce data for environmental permitting and provide strategies to achieve emission levels that meet current and future environmental regulations, which will be critical for successful commercialization of combined-heat-and-power technologies.

EERC, Cummins partner for waste-to-energy project

Silicone-based product manufacturer Dow Corning is considering constructing a biomass combined-heat-and-power (CHP) plant on its Midland, Mich., site to power its existing facility as well as provide steam for its product manufacturing operations there. The company is currently in the permitting process and hopes to make a definitive decision on the CHP plant by the end of this year, according to spokesman Jarrod Erpelding. &ldquo;Alternative energy is very important to us,&rdquo; he said. &ldquo;Currently, power and steam come from a coal-powered source.&rdquo; Steam is a major component of the company&rsquo;s operations, he added. The biomass plant would be built on property owned by Dow Corning and immediately next to its existing manufacturing plant. Initially, it will run on chipped waste wood from woody biomass, but could also combine municipal solid waste, agricultural waste and other low-value feedstocks, Erpelding said. The company is in negotiations for the woody biomass feedstock, but has not begun discussions with suppliers for other sources. The plant would use a gasification process and the amount of electricity and steam it would produce has not been determined. Dow Corning has not released a cost for the facility. This would be the first biomass endeavor for the company and depending on the amount of steam and power it produces, excess energy might be available for sale to neighboring facilities and the local grid, Erpelding said. If the plant proves successful, Dow Corning might consider expanding its biomass portfolio. Dow Corning&rsquo;s silicone-based products are used in construction, solar, life sciences and personal products industries. Cirque Energy LLC would build, own and operate the Midland CHP plant for the company and is handling the environmental permitting.

Dow Corning considers biomass CHP

Nippon Paper Industries USA in Port Angeles, Wash., will replace its existing biomass/oil boiler with a more efficient biomass boiler that will supply steam for the paper mill and 20 megawatts of power for the local grid. The mill has a $71 million budget for the project and plans to apply for federal funding after completing the permitting process, according to mill manager Harold Norlund. The old boiler will not be demolished, but might instead be used as a backup, pending permitting. The wood fuel for the boiler will continue to be residuals from local forestry operations, although more will be needed. Nippon does not own any land, but is surrounded by state Department of Natural Resources land, along with private timber operations. Norlund said the company anticipates securing a supply within a 75-mile radius including two local sawmills. The company hopes to begin construction this fall and implement the system in mid-2012. &ldquo;We&rsquo;re actually considering selling 100 percent of the electricity to the grid,&rdquo; Norlund said. &ldquo;Some public utility districts are looking for renewable energy that fits their portfolios.&rdquo;

Washington paper mill to install biomass boiler

U.K.-based MGT Power Ltd. has begun securing a feedstock supply for its 300-megawatt Tees Renewable Energy Plant, signing a non-binding, long-term&nbsp; memorandum of understanding with Brazilian pulp and paper producer Suzano e Celulose S.A. The two companies are working toward developing a formal contract for the agreement, but MGT declined to release information on how long Suzano will supply pellets for the facility or the amount it will supply. The MOU is backed by an $800 million investment by Suzano, which will develop three projects in Northeast Brazil for the production of 3 million metric tons of eucalyptus pellets per year. The resulting electricity at Tees REP is expected to deliver more than an 88 percent carbon dioxide reduction compared with fossil fuels, according to MGT. Tees REP will be constructed in Teesside, England, and is expected to be completed and operational in 2014. Suzano will supply a significant portion of the clean wood fuel for the facility, but MGT is also looking elsewhere, including local sources. The company is limited, however, to 200,000 metric tons per year of road deliveries to avoid impacts on local roads, according to an MGT spokesman. The company will seek to diversify suppliers and geographies to ensure a reliable supply, he added. Suzano was chosen as a supplier because it is among the largest integrated pulp and paper companies in the world, according to MGT. It will give project lenders comfort as Suzano is a well-established, publicly-traded company with sustainability credentials. Wood pellets from Brazil benefit not only from the country&rsquo;s sunny conditions, but also from the advanced forestry technology developed by Brazilian universities to increase yields in poor soils, the spokesman said. MGT Power also is developing a 300 MW facility in Tyneside, England, but a supply for that facility has not been established as it is in very early stages of development, according to the company.

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MGT signs MOU with Suzano for biomass supply

The U.S. Department of Veterans Affairs is planning to install a biomass combined-heat-and-power (CHP) system at the VA Medical Hospital in Canandaigua, N.Y., and has selected Lockheed Martin and Whiting Turner as winner of the $15 million contract. The fully automated system will run on locally sourced woody biomass, including wood chips and bark salvaged from local lumber yards and logging operations. Lockheed Martin spokesman Cory Smith said the boilers to be installed will use an estimated 15,000 tons of wood chips annually. Lockheed Martin will build, install and test the equipment as well as train hospital employees to maintain the biomass system. Whiting Turner will provide on-site construction leadership and work with the VA to integrate the biomass system. Lockheed Martin has a biomass CHP facility in Owego, N.Y., that opened in 2008. By switching from fuel oil to wood chips, the project has reduced the plant&rsquo;s heating and cooling bills by half and reduced its carbon footprint by 25 percent. The Canandaigua biomass system will be the same configuration as the system in Owego. The project is being funded through the American Recovery and Reinvestment Act of 2009. Smith said this will mark the company&rsquo;s second project after its Owego facility. Construction on the Canandaigua plant will begin this month and will take about three years to complete, according to Smith.

Fuel Supply: Waste wood helps power Lockheed Martin\\\'s CHP plant in Owego, N.Y.

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Veterans Affairs medical center  to install biomass CHP system

North Carolina is a step ahead of the federal government in making the installation&nbsp; of combined-heat-and-power (CHP) systems more economically feasible through a CHP or cogeneration investment tax credit. House Bill 1829 made several changes to North Carolina&rsquo;s renewable energy investment tax credit, which was previously available only to solar, wind, geothermal and other renewable electricity production technologies. Beginning in August, businesses that install CHP systems can receive tax credits from the state equal to 35 percent of the cost of the equipment, construction, and installation, up to a maximum of $2.5 million. CHP systems for use in places other than businesses are eligible for a tax credit of up to $10,500. The new policy skates ahead of pending federal legislation introduced by House Rep. Paul Tonko, D-N.Y. On a federal level, CHP systems are already eligible for a 10 percent federal business energy investment tax credit. The Innovative Energy Systems Act of 2010 (H.R. 4751) proposes the removal of the current tax credit limitations to small projects, as the 10 percent credit only applies to the first 15 megawatts (MW) of a project and is limited to 50 MW. The bill would apply the tax credit to a project&rsquo;s first 25 MW, as well as provide a 30 percent credit for recycled energy and CHP with efficiencies above 70 percent. According to the U.S. DOE&rsquo;s Office of Energy Efficiency and Renewable Energy, while the traditional method of separately producing usable heat and power has a typical combined efficiency of 45 percent, CHP systems can operate at efficiency levels as high as 80 percent. While the fate of H.R. 4751 remains uncertain, North Carolina may see a CHP boom. The state currently has CHP installation capacity of about 1,482 MW at 45 sites, according to the U.S. DOE&rsquo;s Energy and Environmental Analysis Inc. Keith McAllister, director of the Southeast Clean Energy Application Center, said that ICF International, which tracks information for the Energy Information Administration, estimates that the tax credit will increase the amount of CHP in the state by 103 MW in the near future. "The passage of this bill, which allows CHP fueled from any source to get the tax credit, should bring the bigger players to the table,&rdquo; he said. &ldquo;There are still barriers to the market place, but having these organizations' interest should help to remove those barriers as well."

NC passes CHP investment tax credit law

Washington-based Green Diamond Resource Co. has signed a long-term supply contract with Adage, a biopower joint venture between Areva and Duke Energy, for a proposed 55-megawatt woody biomass power plant in Mason County, Wash. Adage will be responsible for removing the residue left behind by Green Diamond harvesters under the supervision of Green Diamond, the largest private forest landowner in the immediate area around the plant. Currently, slash left behind is piled and burned to clear the way for replanting, which by law must be done within three years of harvesting. &ldquo;When we go back in, there&rsquo;s no room to plant because there&rsquo;s all this slash on the ground,&rdquo; said Patti Case, public affairs manager for Green Diamond. &ldquo;So we pile this residue and wait until fire season is past &hellip; and we burn it in the forest.&rdquo; The slash piles contain limbs and soft wood that isn&rsquo;t usable, along with defective and rotten pieces. The new agreement will save Green Diamond the cost of piling and burning the slash, Case said. The amount of residue Adage will harvest for its plant is confidential, according to Case. She also declined to disclose how many acres of Green Diamond&rsquo;s property will be harvested, but it will account for 15 to 20 percent of Adage&rsquo;s required supply. She did say, however, that Adage will have access to most of the company&rsquo;s land that can be affordably harvested for residue within a 50-mile radius of the proposed plant. Forest owners in the state of Washington are required to leave 17 to 20 percent of the residue behind to protect fish habitats, streams and upland wildlife, according to Case. &ldquo;Washington state has arguably the toughest forest regulations in the world,&rdquo; she said. Forest owners are also required to reduce wildfire hazards next to roads. &ldquo;Instead of piling and burning, they&rsquo;ll be taking that,&rdquo; Case said. Adage&rsquo;s plant represents a $250 million investment in Mason County. It will be located in Shelton and is expected to create more than 400 jobs during construction and more than 100 during permanent operation, according to the company. Adage hopes to begin construction in early 2011, pending permit issuance, and will for the first time implement its partnership with John Deere. Earlier this year, the two companies announced an alliance to bring technology and process innovation to the fuel supply for woody biomass power plants. Adage is also developing a biomass power project in Florida and has faced effective, albeit small, citizen opposition at its proposed Gadsden County site in Gretna. After Gretna city officials announced in March they would defer decision on the plant for six months, the company suspended its air permit application. The city then answered back with a letter stating it considered the matter closed and would take no further action. Adage is still working to develop a plant in Hamilton County, Fla.

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Adage secures woody biomass supply in Washington

Not too long ago, making decisions about a company&rsquo;s energy management and sustainability was a fairly uncomplicated process for most facility managers. Switching to fluorescent lighting, upgrading the heating, ventilating and air conditioning systems, and streamlining production by upgrading to a more integrated process controls architecture are among scores of initiatives a company may have undertaken in pursuit of more energy efficiency, productivity and sustainability.&nbsp; But today it is different. For industrial and manufacturing companies with large campuses or multiple facilities, possibly operating with different production systems and scattered across various geographic locations, managing such a task can become a significant challenge. The importance of the problem is magnified even further for those facilities that have high energy usage, deal with hazardous materials or have sizable waste disposal issues. For large operations, campus facilities or companies with multiple locations an energy audit alone may not be sufficient to cover all the mitigating factors needed to be addressed. What such a company needs is a clearly written road map to achieving its energy and sustainability objectives. Comprehensive Approach to Energy Planning The solution for resolving the integration of energy and sustainability projects and assets in large industrial, manufacturing and institutional facilities is a fully integrated energy master plan. This is a long-term, broad-scoped plan that puts in place a company&rsquo;s strategy to optimize all facets of energy efficiency and sustainability. This begins at the purchase of energy and other utilities, and covers all aspects of their use, distribution, measurement and minimization of waste. The plan establishes recommendations on how to best utilize energy assets, how and when to replace them and how to be most efficient when a company needs to add to them. Energy master plans also provide the individualized and detailed steps to plan for energy and sustainable systems within each building of a whole-building campus or multiple-location context. The buildings, and the energy and sustainable initiatives installed within them, are totally integrated into one uniform and holistic system. Although the components of the energy master plan are not entirely new, the necessity of putting this all together into a single, integrated package is a new approach, something that many larger companies are now recognizing they need in order to make smarter energy decisions. This approach allows energy managers to recognize opportunities for conservation, sustainable design and renewable energy that more narrowly focused energy audits might not. An integrated energy master plan, because of its comprehensive protocol, will not only address facility operations, but process functions for review, as well. For example, integrating discrete control automation systems within different process functions in a cement plant into one centralized controls architecture can significantly reduce process cycle times, improving throughput, energy usage and equipment return on investment, not to mention production per labor hour. An integrated energy master plan would address this. A food processor that is blanching and chilling pasta in 10,000-pound batches per hour will find that by switching to a continuous cook and chill method, it can process the same volume of pasta in the same time, while reducing its cost for heating the cooking water. An integrated energy master plan would not only deliver the benefit of the continuous processing method over batch processing, but would show the energy conservation in using the spent, warmed-up chiller water as make-up water for the cooker, thereby reducing the energy needed to bring the cooker up to its required 200 degrees Fahrenheit cooking temperature. An energy master plan which integrates facility and process functions is of critical value to an industrial, manufacturing or institutional facility. Further, such a plan takes into consideration a company's higher-level, long-term business goals. This may include portraying an image that reflects environmental awareness, energy conservation or possibly healthy working conditions for employees by promoting a working environment that utilizes sustainable materials. In this regard, an energy master plan extends beyond those responsible for energy management, going well into the upper strata of corporate decision making for marketing, human resources, facility operations and investor relations. Through a systematic analysis of these interdependencies and optimized energy benefits, a much more efficient and cost-effective energy plan can be realized that takes into account the long-term business goals of a company. Managing Energy and Sustainable Initiatives With the continual increases in energy costs, power quality issues and stiffer pollution regulations the need for streamlining energy usage and providing for sustainability issues has never been stronger. Facility managers are being hit with a barrage of energy-efficiency and sustainability information from suppliers. Mandates from local, state and federal government agencies require decisions from company managers on issues which many have little previous experience handling. Additionally, the influx of incentives promoting energy efficiency, as well as renewable and alternative energy production demand astute attention because of the corporate benefits they can impart. Companies may not have considered with a high level of detail what their energy asset portfolio looks like and what the optimal next incremental investment is to enhance their sustainability. Is this the year that an industrial company should be converting its fleet to natural gas? Or do the market trends show that two years from now such a switch would be half the cost or offer better tax credits, and therefore it should wait? A manufacturer with a budget of $3 million a year dedicated to improve its energy assets may have six plants in as many states with varying power consumption and power quality issues, variations in air quality, and differences in wastewater effluent and treatment processes, and a dozen other influencing factors. What is the best place for it to invest that capital? Legislation from U.S. EPA regulations and local building codes on what energy and sustainable initiatives can and need to be undertaken, and what has to be reported is ever-increasing. Many companies are unaware of these regulations, and many would not know where to begin if they were required to implement them. It has been common practice for manufacturing, industrial and institutional facilities to contract with different suppliers to implement their energy and sustainability projects. This has the liability of a piecemeal approach where the individual projects lack full integration and foresight, which can result in nonoptimized energy usage and a failure to fully realize senior management objectives. For example, a pharmaceutical processor, to become more sustainable, may desire to install a combined-heat-and-power (CHP) capability to offset its electric and hot water costs by capturing biogas from its wastewater treatment plant. But 10 years earlier, the plant upgraded its wastewater treatment to an aerobic reactor, incapable of producing sufficient biogas for CHP. Had an integrated energy master plan been put in place earlier, the pharma processor would have foreseen the capability for CHP within its plant and built an anaerobic reactor instead, which produces usable biogas. 4-Stage Integrated Energy Master Plan An integrated energy master plan is individualized for each company, but includes the following four-stage parameters: &bull; Investigation: The first phase of an integrated and comprehensive energy master plan is investigation. What is a company trying to achieve with such an initiative? What is, and what is not to be considered within the scope of the plan? This involves interviewing key personnel relative to known and unknown problems regarding energy, production and maintenance issues. It also includes identifying constraints, such as financial, physical, cultural, zoning and any other limitations that may be intervening factors in an energy strategy. The investigation also includes review of historical utility bills, a review of the company&rsquo;s carbon footprint and emissions, gathering of relevant facility, electrical and mechanical drawings, specification sheets and automated energy management system records. &bull; Visioning: This phase brings together key decision makers, such as the chief executive officer, the head of energy or the head of facilities, to understand what their vision is. Is it to reduce energy consumption over a period of time, to manage risks, or to add renewable energy? What exactly is their goal, their vision? How do these goals tie in to the overall business objectives of the company, including factors such as product line changes and expansions, and facility build-outs or acquisitions that would influence decisions? What do they want to end up with 10 years from now, so that can be backed up into a 10-year or five-year plan. It presents an in-depth review of the findings from the investigation phase, including quantifying and visualizing system consumption and output; benchmarking to baseline and best practice systems; summarizing objectives and critical issues; identifying opportunities to pursue; and considering potential paths to follow. This step includes a review of energy and sustainability technology trends. Critical to this phase is a clarification and modification of the vision for the energy plan, as needed to achieve its stated goals, and to determine what is to be included and not included in the plan, as well as to determine how to manage constraints. &bull; Analysis: A company now looks at all of the opportunities available, compared with the clarified vision and plan. It more closely investigates those technologies that can be utilized, and assembles basic costs and a phasing schedule to stagger the introduction of the technology as deemed most effective. A multiple-approach master plan is then drafted. This part of the plan assesses energy and water efficiency, facility and equipment enhancements, heat and water recovery, control systems, sustainable systems, utility billing rate structure, peak shaving and shifting, and on-site power generation including renewable energy. &bull; Deliverables: The final phase encompasses finalizing the energy master plan. This comprehensive plan includes an investment plan, energy targets, building sustainability targets, emissions and carbon footprint targets, operational targets, informational targets, and maintenance and upkeep targets. The plan also identifies final budget and resource commitments. This section phases in all of the technologies and how the capital spending will be administered. It puts together any kind of internal communications tools that will be needed&mdash;such as implementing a cultural shift at the facility locations that talk about reducing water consumption or turning lights off. Everything needed to understand what this plan is, how to communicate the plan, how to present it to management, and then how to implement the plan. Total Energy Management There is clearly superior value in consolidating all of a company&rsquo;s energy assets into one package. For optimized feasibility, integrating both facility and process systems with a company&rsquo;s overall sustainability objectives is ideal for a complete and integrated approach. Energy master planning is a valuable fundamental building block for all high-energy-consuming industrial and manufacturing operations for reducing energy usage, utility costs and promoting sustainability. But more importantly, it can provide for efficient, long-term management of a company&rsquo;s energy assets. Authors: Jerry Carter Senior Associate and Business Leader, SOSE Group's Sustainable and Renwable Solutions Zach Platsis Energy Specialist, SOSE Group's Sustainable and Renwable Solutions <a href="http://www.ssoe.com">www.ssoe.com</a>
&nbsp;
------ The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Biomass Power &amp; Thermal or its advertisers. All questions pertaining to this article should be directed to the author(s).

Power Plan: Companies can benefit from a clearly written road map detailing how they can conserve energy and take advantage of renewable options.

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Step-by-Step: A comprehensive energy master plan details how to utilize energy assets, how and when to replace them and how to be most efficient when adding to them.

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Industrial and manufacturing companies can realize cost, efficiency and operational benefits from an integrated energy master plan versus the conventional piecemeal approach to managing energy and sustainability initiatives. 

Energy Master Plans Streamline Operational Efficiency, Reduce Costs

The University of British Columbia will soon be home to the first installation of a new biomass combined-heat-and-power (CHP) system developed by Nexterra Systems Corp. and GE&rsquo;s Jenbacher gas engine division. The city of Vancouver and local companies will supply tree trimmings and other urban wood waste diverted from the city landfill as fuel for the plant. The 2-megawatt (MW) system will require about 12,500 bone-dry tons of wood waste, according to Darcy Quinn, Nexterra business development manager.&nbsp; The CHP system combines Nexterra&rsquo;s gasification and syngas conditioning technologies with a GE high-efficiency Jenbacher gas engine. Though Nexterra has several other biomass gasification system installations around the world, Quinn said this is the first demonstration of this particular application in North America. &ldquo;The difference between this system and the others we have is that it sends the syngas directly into an internal combustion engine to produce the power, as opposed to just steam,&rdquo; he said. The electricity produced by the system will be distributed throughout the UBC campus to meet some of the college&rsquo;s power needs; waste heat will be recovered from the engine to produce enough steam to replace about 15 percent of UBC&rsquo;s current natural gas requirements. Additionally, UBC will see a greenhouse gas emissions reduction of 4,000 metric tons per year. The system at UBC is on the small end of what Nexterra believes is the sweet spot for sizing these particular systems, according to Quinn, as that range is expected to be within 2 to 10 MW. Compared to conventional biomass power system electrical efficiencies of about 18 to 21 percent, this CHP system has demonstrated a 26 to 30 percent electrical efficiency, he said. Other partners in the project include the province of British Columbia, the Canadian government, the city of Vancouver, FPInnovations, BC Bioenergy Network and Sustainable Development Technology Canada. &nbsp;Quinn said the installation at UBC should be completed in the third or fourth quarter of 2011.

Model of Efficiency: This architectural rendering shows how UBS\\\'s CHP steam system will be housed.

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Nexterra debuts biomass CHP system 

New regulations proposed by the Manitoba government aim to improve air quality in the province while encouraging the use of natural biomass materials as fuel. Manitoba Conservation Minister Bill Blaikie made the announcement August 23, emphasizing that the new rules would help make the air cleaner and also streamline the approval process for new clean energy systems such as biomass, as a heat and power source to replace fossil fuels. Thermal treatment technologies included in the proposal are combustion, gasification and pyrolysis. Blaikie added that the proposed laws would make biomass-based systems more attractive to industry by putting in place a simpler and faster permit system. The regulations would also level the playing field for biomass thermal systems currently competing with fossil-fuel based incineration systems, by requiring additional air quality protection. Manitoba Hydro Senior Bio Systems Engineer Dennis St. George agreed with Blaikie that the new incinerator rules will help promote the use of biomass and other wastes as fuels for heat and power generation in Manitoba. &ldquo;I'm also sure that customers who are currently relying on incineration to dispose of their waste materials will appreciate having Manitoba Hydro's Power Smart Bioenergy Optimization Program available to add value to their business,&rdquo; he said. Manitoba Hydro, the fourth-largest utility in Canada and largest exporter of electricity to the U.S., currently runs the Power Smart Bioenergy Optimization Program to provide financial incentives to customers who are interested in converting their raw forms of biomass&mdash;typically biomass already available on-site&mdash;to produce energy, displacing some or all of the energy purchased from Manitoba Hydro. &ldquo;With the utility&rsquo;s capacity links to the U.S., we can then put this energy into the U.S. market where it offers better value,&rdquo; St. George said. &nbsp;Overall, every little push forward helps the biomass-to-energy sector move ahead, according to St. George. &ldquo;In general, the biomass-to-energy sector has not received the same attention as the other renewables like wind and solar," he said. "To date, there hasn't been an even playing field for biomass to energy and typically projects have relied solely on the project benefits to move ahead. Policy and markets are two key areas that influence the potential for biomass energy.&rdquo; [ON THE WEB: The new regulations can be found at <a href="../www.gov.mb.ca">www.gov.mb.ca</a>]

Manitoba proposed rules encourage biomass power

The proposed conversion of an Ontario coal-fired power plant to biomass has achieved a critical next step in project implementation: the province has directed the Ontario Power Authority to begin negotiations to purchase power generated at the plant. The 211-megawatt (MW) Atikokan Generation Station, which is about 200 kilometers (125 miles) northwest of Thunder Bay, Ontario, will be the first power station that Ontario Power Generation will convert to biomass. The company owns three other coal-fired power plants in Canada, and previously announced plans to evaluate repowering all of them with biomass by the end of 2014. OPG Spokesman Ted Gruetzner said that although the order from the province to the OPA to buy the biomass power is one important pillar to the project, capital costs and availability of fuel are still being evaluated. The Atikokan plant will require about 90,000 metric tons (99,000 tons) of wood pellets per year; less than 1 percent of the total allowable annual forest harvest in Ontario. OPG began a call for potential feedstock suppliers in mid-March.&nbsp; &ldquo;We had some interest in that, but we&rsquo;re still working through that process in terms of coming out with the supply contracts,&rdquo; Gruetzner said. OPG&rsquo;s proposed biomass conversions are in accordance with Ontario&rsquo;s commitment to eliminate all coal-fired power generation in the province by the end of 2014, as part of the province&rsquo;s Green Energy Act of 2009. The act also features North America's most comprehensive renewable energy feed-in tariff, which offers guaranteed and attractive prices to developers of biomass, biogas, wind, water and solar power projects. The rate for biomass is 13.8 cents per kilowatt for plants under 10 MW and 13 cents for larger facilities. According to the Ontario Ministry of Energy and Infrastructure, in 2009, generation by Ontario's coal plants was at its lowest level in 45 years, down more than 70 percent from 2003. Provincial Parliament Member Bill Mauro said the power purchase agreement marks the end of six years of efforts to keep the Atikokan generating station running, as closure of the plant would have been devastating to businesses and homeowners in Atikokan, a town of about 3,400 people. Aside from saving jobs at the plant, OPG estimates that about 200 construction jobs will be created during the conversion.

Ontario biomass conversion plans progress

If drafted renewable portfolio standard (RPS) regulations pass in Massachusetts, biomass power plants will be required to achieve between 40 and 70 percent efficiency and 50 percent greenhouse gas (GHG) reduction relative to life-cycle emissions from a combined-cycle natural gas facility using the most efficient technology. Not only would those standards be nearly impossible to meet without substantial investments, but it would thwart development of new plants, costing hundreds of jobs in an already struggling economy. The Massachusetts Department of Energy Resources released draft regulations for RPS qualification Sept. 17, drawing from the results of the Manomet Center for Conservation Sciences&rsquo; Biomass Sustainability and Carbon Policy Study, along with public input. The study results showed a debt-then-dividend model in which woody biomass power initially emits more carbon per unit of energy than fossil fuels and makes it up over time. But it has been controversial in numerous aspects, perhaps most notably its evaluation of whole tree feedstock, which is not used by most biomass power plants. It does take slash and forest residue into account, but only alongside whole logs. That greatly affects the carbon footprint, according to Bob Cleaves, president and CEO of the Biomass Power Association. &ldquo;So essentially, the patient has been given a prescription for an ailment that doesn&rsquo;t exist,&rdquo; Cleaves said in a media call Sept. 20. The regulations will determine which projects will receive renewable energy certificates, therefore determining economic feasibility. The draft regulations also include an encompassing definition of biomass, further limiting all biomass harvests to just 15 percent of the weight of all forest products. That greatly increases forest fire hazards as well as takes away a key market for forest owners, according to Kent Lage, executive director of the Massachusetts Wood Producers Association, who also participated in the call. The limitation should be based on a site-specific evaluation, not a one-size-fits-all standard, he added. &ldquo;We&rsquo;ve got some major concerns about that.&rdquo; Pioneer Renewable Energy is developing a $250 million, 46-megawatt biomass power plant in Greenfield, Mass., that would pay more in local property taxes than the top 10 taxpayers combined, according to Principal Matt Wolfe. He argued the rules, specifically the efficiency standard, will most certainly stop development in all of New England. &ldquo;In our opinion, it&rsquo;s completely arbitrary and not scientific,&rdquo; he said. Richard Rosen, of American Ag Energy, said he has proposed projects that would allow greenhouses to use heat from biomass power plants, but the proposed regulations would stomp them out. &ldquo;We have four projects under development now in New England and none of them will be built under these rules,&rdquo; he said. Wayne Lehman of Laborers Local Union 596 echoed the same sentiment, focusing on job loss. &ldquo;Our guys need jobs,&rdquo; he said. &ldquo;We have no jobs right now. I have guys who are having trouble putting food on their families&rsquo; tables.&rdquo; When jobs in the biomass sector have arisen recently, they have been shot down just as quickly, he added. The proposed rule also mandates cutting plans, fuel certificates, tonnage reports and forester certifications. It requires Forest Impact Assessments be conducted by the DOER every five years. Generation units using eligible woody biomass fuel or manufactured biomass fuel would also have to produce a quarterly report addressing biomass input heat content, useful thermal energy, merchantable bioproducts, renewable generation and overall efficiency. A comment period on the proposed rules is open until Oct. 21 and final rules should be released by the end of the year. No state has proposed, let alone implemented such strict efficiency standards and Cleaves maintains they are unachievable and would &ldquo;chill&rdquo; any project in the commonwealth of Massachusetts, where biomass currently makes up 50 percent of the renewable portfolio. He said the rules attempt to increase efficiency of a project that doesn&rsquo;t exist&mdash;one that uses whole trees. &ldquo;We are confident that no new facilities will be based in New England under these rules,&rdquo; he said.

Massachusetts proposed RPS stymies biomass

With a long-term fuel supply agreement in place, a proposed biomass power plant near Shelton, Wash., is one giant leap closer to becoming a reality. It will use residue from nearby forestry operations to generate 55 megawatts (MW) of power for sale to the Pacific Coast grid. Washington-based developer Adage announced the agreement with Green Diamond Resource Co. in August, saying it&rsquo;s critical to the success of the plant. A detailed fuel supply agreement can make or break a project, according to JD Lindeberg, chief financial officer and principal of engineering and consulting firm Resource Recycling Systems Inc. &ldquo;A lot of developers don&rsquo;t have any sense about how detailed the fuel piece needs to be,&rdquo; Lindeberg says. A solid agreement evaluates obvious factors such as availability and price, but also needs to account for possible price changes in the life of the agreement, current and future competitors for the supply, the impacts of external factors, supply economics, and exogenous variables such as the price of diesel and gross national products. Not only are such well-crafted fuel supply agreements important for operation of a plant, but they are also a staple in securing project funding. Fixated on Financing &ldquo;In general, these facilities are financed on some sort of long-term debt and whoever is supplying the debt wants to know that the price of fuel isn&rsquo;t going to become exorbitant and last from year five to year 20, which means they won&rsquo;t get paid on their debt,&rdquo; Lindeberg says. Developers can and will be denied funding without a solid, detailed fuel supply agreement. Although it&rsquo;s possible to apply again, first impressions can be hard to overcome. &ldquo;You lose credibility with the financers,&rdquo; he says. &ldquo;These finance guys don&rsquo;t like to look at things twice. It&rsquo;s easier for them to come to a conclusion and not change it.&rdquo; Banks are generally much more conservative than equity lenders because banks don&rsquo;t make multiples on the money they lend. Since they only earn what they charge in interest, banks think differently about the risk involved. &ldquo;That&rsquo;s something developers forget,&rdquo; Lindeberg says, adding that banks need 50 successes to make up for one failure. Another aspect easily overlooked by developers is the relationship between a fuel supply agreement and a power purchase agreement (PPA). &ldquo;Personally, I think developers go too far negotiating their PPA without understanding the price of fuel,&rdquo; Lindeberg says. &ldquo;One of the lessons I think people need to learn is that you&rsquo;re not going to get your fuel supply agreement sorted out in a final way [without a PPA]. It needs to proceed in parallel.&rdquo; But even if those two critical elements are negotiated in parallel, other factors can throw off the balance and devastate a project, as learned by a California-based wood products manufacturer. In mid-August, Sierra Pacific Industries was forced to abruptly close its woody biomass power plant in Loyalton, Calif., because of insufficient and expensive fuel supplies coupled with a decrease in rates paid for its electricity by utility NV Energy. The plant was powering and getting feedstock from SPI&rsquo;s nearby sawmill until it shut down in 2001, requiring SPI to develop fuel supply contracts with other organizations to keep the 16 MW power plant running and supplying the grid. &ldquo;Then it&rsquo;s a scramble to find the wood,&rdquo; says Mark Pawlicki, director of corporate affairs and sustainability for SPI. &ldquo;We don&rsquo;t have a ready supply like we did when we had a sawmill.&rdquo; SPI quickly developed fuel supply contracts with landfills, the forest service and others but transportation was costly and the forest service reduced its timber offerings. Even so, the operation was doable until the power rate decrease. &ldquo;The combination of the high fuel costs due to the reduced availability of timber and a simultaneous reduction in rates made it uneconomical,&rdquo; Pawlicki says. SPI is exploring options for opportunities to reopen the plant in the future, he adds. &ldquo;There&rsquo;s obviously a relationship there between what you&rsquo;re paying and what you&rsquo;re selling the power for,&rdquo; says Tom DePonty, director of public affairs at Adage. After having secured the first fuel supply agreement for its Shelton plant, Adage is now marketing its output to utilities in Washington and Oregon. The company signed a lease agreement for the land in August and is currently in the middle of the permitting process. Adage has not yet applied for funding opportunities, but the fuel contract is a great first step, DePonty says, adding that it&rsquo;s crucial to have in place at the time of funding application. Adage hopes to break ground at the site next year and commence operation in late 2013. The company will be responsible for harvesting the residue, including limbs, softwood, and defective or rotting pieces, from Green Diamond&rsquo;s forestry operations, under Green Diamond&rsquo;s supervision. The harvests will make up between 20 and 30 percent of the plant&rsquo;s requirements and the rest is being negotiated for three or four additional contracts all providing the same residual material, DePonty says. The company chose Green Diamond because of its ability to be a long-term sustainable supplier, he adds, although the timeline of the contract is confidential. Ideally, Adage will source its supply within 50 miles of the plant, but could expand depending on availability and ease of transport routes. &ldquo;There obviously could be some opportunities to go farther than that based on road configuration and things like that where it could be economical,&rdquo; DePonty says. Feedstock Economics Feedstock can be sourced as far as 75 to 100 miles from a power plant, according to Lindeberg. &ldquo;It&rsquo;s very difficult to transport it farther than that and still have a cost-effective fuel supply,&rdquo; he says, adding that the &ldquo;big trick&rdquo; is the cost to bring it in. When a tree is logged, 50 to 60 percent of that tree doesn&rsquo;t leave the forest, he cites. The leaves, tops and other residue are left behind. Then, when it&rsquo;s taken to the sawmill, only about 50 to 60 percent is used for lumber, the rest&mdash;bark, sawdust and other products&mdash;is left behind. &ldquo;Between 60 and 70 percent of that tree that&rsquo;s cut down for wood is waste,&rdquo; Lindeberg says. &ldquo;That waste is some of the primary fuel supplies for these biomass power plants.&rdquo;&nbsp; The least expensive way to acquire forest residue feedstock is in spot markets from smaller players, Lindeberg says. Spot markets represent an avenue for a transaction somewhat similar to open solicitations. &ldquo;I&rsquo;m paying a price and people who have it show up,&rdquo; he explains. &ldquo;A spot market is much more volatile in terms of pricing.&rdquo; Spot markets are a favorable alternative to long-term supply agreements with one large supplier, he says. &ldquo;The point I try to make to these guys is this is not about typical financial guarantees. This is about economic guarantees.&rdquo; The lack of a market price for feedstock deters long-term supply contract development, according to Stephen Dinehart, principal of Heartland Business Consultants in Wisconsin. A feedstock pricing mechanism is crucial to the future development of the biomass market, he says. Today&rsquo;s markets are single-buyer dominated and influenced by social factors, especially when developers are securing supplies from small, local operations. Prepare for Competition A biomass power plant will seldom be the sole user of woody biomass feedstock in a region. Besides wood pellet plants, direct competition can include mulch/composting, board manufacture, firewood, animal bedding, and pulp and paper mills. Paper mills, however, cannot use bark or tree tops and, under the right circumstances, can boost the available feedstock supply if they increase harvesting rates. &ldquo;That competitor can sometimes be a complement: the more activity they have, the more fuel you might have, but it&rsquo;s just of a different nature,&rdquo; Lindeberg explains. Needless to say, wood pellet manufacturers also represent competition in the marketplace. But many competitors can&rsquo;t take the lower-grade woody biomass that power plants can. &ldquo;The biggest competitors are other biomass power plants,&rdquo; Lindeberg says. &ldquo;That&rsquo;s potentially problematic.&rdquo; Foreseeing future competitors is perhaps the most important aspect, but there is a benefit to being the first operation in a given location. &ldquo;If you can get into the marketplace first and establish relationships and treat your suppliers well, then we&rsquo;re ready to rock and roll,&rdquo; he says. &ldquo;You&rsquo;re there first and you&rsquo;re going to keep getting that material.&rdquo; &ldquo;When we started looking at western Washington, the first thing we did was evaluate the available feedstock, the land ownership and also the existing users of biomass in that region to kind of assess whether a project was viable in that region,&rdquo; DePonty says, adding that Adage discovered the vibrant forestry environment was more than adequate to supply its plant, along with others existing or proposed. &ldquo;We think this is an exceptional location for biomass.&rdquo; Another competitor for biomass feedstock is alternative disposal, such as landfilling. &ldquo;If they have other means of disposal instead of you, they will always consider doing that,&rdquo; Lindeberg says. &ldquo;Never underestimate the potential for people to continue doing the same thing.&rdquo; Evaluating suppliers&rsquo; other disposal options and prices can expose ways to convince them that supplying a power plant is a better option. The biomass industry is no stranger to opposition, but securing feedstock agreements that spell out the material used can help clear up misunderstandings and rumors about clear-cutting and burning whole trees. Working with local suppliers can make a project more tangible for local citizens, DePonty says. &ldquo;It helps them understand more clearly what the project is all about,&rdquo; he adds. Biomass fuel supply agreements make up one sturdy leg of what Lindeberg calls development&rsquo;s three-legged stool, supported by PPAs and the actual construction or conversion of a power plant. &ldquo;You&rsquo;ve got to have all three of those things or no one&rsquo;s going to give you any money,&rdquo; he says. &ldquo;[Fuel supply agreements are] not necessarily any more important than the other two, but without any one of them, you&rsquo;re not going anywhere.&rdquo; &nbsp; Author: Lisa Gibson Associate Editor, Biomass Power &amp; Thermal (701) 738-4952 <a href="mailto:lgibson@bbiinternational.com">lgibson@bbiinternational.com</a>

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Piling Up: Woody biomass feedstock is dumped onto a growing pile.

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Stockpiling: A conveyor is used to move woody biomass.

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The strength of a biomass power project can hinge on the credibility and detail of a fuel supply agreement. Aside from the fact that a plant can't operate without feedstock, the lack of a solid, sustainable fuel supply will exponentially decrease the

Supply Supply Supply

Making its U.S. debut, a dry fermentation process will convert organic waste from San Jose and surrounding communities into power for its own operation and others nearby. The anaerobic digestion process is commonly used and well-known in Germany and across Europe, but San Jose&rsquo;s installation will be much bigger and modified for use in the U.S. A contributor toward the city&rsquo;s 2008 Zero Waste Strategic Plan, the project will increase the amount of garbage diverted from landfills and could serve as a model for urban anaerobic digestion projects all over the country. Developer Zero Waste Energy Development Co., a joint venture between local sister companies GreenWaste Recovery and Zanker Road Resource Management, is in the middle of permitting the commercial facility, dubbed Zanker Road Biogas, and plans to break ground this year and begin operation in late 2011. The plant will be flanked on two sides by Zanker Road Resource Management&rsquo;s existing outdoor processing operations for mixed waste and construction and demolition debris. While that waste is unlikely to be digested at the biogas facility, it could be used as bulker after the digestion process, according to Emily Hanson, GreenWaste community relations manager and project director. In fact, feedstock contracts for Zanker Road Biogas have yet to be negotiated, but Hanson isn&rsquo;t worried. The Cutting Edge &ldquo;Most companies wait until they have a guaranteed feedstock to develop innovative projects,&rdquo; Hanson says. &ldquo;What we have opted to do, and it&rsquo;s a little more risky but it also puts us on the cutting edge, is we&rsquo;ve decided to plan and develop this anaerobic digestion facility, even though we don&rsquo;t have a guaranteed feedstock at this point.&rdquo; The feedstock will come from contractual agreements and open markets from regional jurisdictions, but if necessary, could come from GreenWaste&rsquo;s existing dirty materials recovery facility (MRF), less than 10 miles from the project site. The MRF already processes multifamily waste from San Jose; 100 percent of all waste including garbage, composting and recycling from nearby Los Altos Hills, Woodside and Portola Valley; a portion of waste from Palo Alto; and open market materials. Each week, 1,600 tons go through the facility for a recovery rate of 75 percent. &ldquo;We process those organics and municipal solid waste and then in the back end, we end up with a very rich organic fraction,&rdquo; Hanson says. From there, the processed material goes to Z-Best Compost&mdash;owned by Zanker&mdash;in nearby Gilroy, Calif., where it is composted for landscaping markets. That organic material would make great feedstock for the biogas facility, but Hanson hopes additional contracts will make its use unwarranted. &ldquo;By the time the facility is on line, it&rsquo;s likely we&rsquo;ll have enough material where we won&rsquo;t have to divert from our sister facility,&rdquo; she says. &ldquo;We are currently seeking out new sources of organic material, so it may be the case that we don&rsquo;t have to offset any tons that are going to Z-Best. Z-Best could maintain its consistent flow of material from the GreenWaste MRF, and all of the extra material that is organic through other contracts and through open market services will then to go Zanker [Road Biogas].&rdquo; Those potential contracts include one that would allow collection of all the commercial organic waste in the city of San Jose, an unspecified amount as it has been an open market and not tracked closely. &ldquo;If we are awarded that processing contract, the feedstock would completely take up one entire phase of our anaerobic digestion facility build out,&rdquo; Hanson says. Zero Waste will know in November if it has been awarded the contract. The resulting biogas will be converted to power and initially used for the process itself and perhaps the adjacent Zanker facilities. The amount of power it produces will depend entirely on the composition of the feedstock, efficiency of operation and other factors expected to be polished in the three-phase build-out strategy, starting at double the size of any existing similar operations in Germany. The facility will be capable of taking up to 150,000 tons of waste per year, but will start on a smaller scale. The build-out phases will not be distinguished by feedstock tonnage, but instead by the improvements made to the system as it operates and as Zero Waste learns how to cater it to applications in the U.S. &ldquo;Our intention is as soon as it&rsquo;s operable and we&rsquo;re able to start calibrating the productivity of the facility, we will then be able to inform any changes we want to make on phase two to optimize its efficiency,&rdquo; Hanson says. Although the facility will be a commercial operation, it will be a demonstration of U.S. applications and will be somewhat of a learning experience for GreenWaste, Zanker and the city. &ldquo;The opportunity we have in San Jose is to create a reference facility that we&rsquo;ll collect data from and provide that information for other municipalities and agencies that might be interested in how this would work,&rdquo; says Jo Zientek, deputy director of Integrated Waste Management for the city of San Jose. The U.S. Translation After numerous trips to German dry fermentation plants and copious amounts of research, GreenWaste and Zanker agreed on translating the technology to a U.S. utilization. Besides being bigger than installations in Europe, Zanker Road Biogas will also employ modified odor-control systems and will be tailored to achieve a high-quality composting product. &ldquo;Energy output is an important component, but we want to have a saleable quality compost on the back end, which is something they don&rsquo;t do in Germany and they don&rsquo;t do in Europe,&rdquo; Hanson says. &ldquo;They don&rsquo;t prioritize high-quality compost.&rdquo; Zientek is hoping both water and energy use can be reduced in the San Jose application, along with other improvements. &ldquo;There are lots of operational decisions that we will learn quickly how to maximize gas output, to maximize throughput and to maximize quality of the compost on the back end,&rdquo; Hanson says.&nbsp; &ldquo;The potential the project has and the amount of energy that can be produced is really exciting for the industry and I think it also demonstrates that there is a lot of interest in doing biogas projects all across the country and that&rsquo;s really exciting to see,&rdquo; says Amanda Bilek, energy policy specialist at Great Plains Institute and author of the report &ldquo;Spotlight on Biogas: Policies for Utilization and Deployment in the Midwest,&rdquo; released in August. The study analyzes state and federal policy that could increase biogas project development in the U.S., focusing specifically on agricultural opportunities in the Midwest. &ldquo;It is important to have technologies and tools for urban communities as well and municipal solid waste or source-separated organics are a big part of that,&rdquo; Bilek says. Zanker and GreenWaste also developed Zero Waste Energy, a new company that will market the technology throughout the country. &ldquo;The intention there is to combine not just the anaerobic digestion process, but also the front-end processing so you get the best feedstock that goes into the anaerobic digesters,&rdquo; Hanson says. She declined to release a cost estimate for the facility, saying it&rsquo;s a moving target, but did say Zero Waste will seek funding through the U.S. Department of Treasury&rsquo;s Payments for Specified Energy Property in Lieu of Tax Credits program. The Process Zanker Road Biogas will be divided into two parts: the digestion process and the composting process. Everything takes place within an enclosed building with extensive odor control along with a huge biofilter. &ldquo;One of the concerns facilities like this have encountered in Europe is the odor, so we&rsquo;re going above and beyond in terms of sizing the biofilter as well as the number of air exchanges per hour to control the odors,&rdquo; Hanson says. Even the receiving halls where truckloads of waste will be dumped are enclosed with negative aeration so the smell will not escape when the doors are open, she adds. Depending on the composition of the feedstock, it could be mixed for consistency and then it&rsquo;s off to the air-tight, gas-tight digestion tunnels. The particular technology is scaled on eight digester units, so multiple tunnels will be digesting simultaneously. Inside the tunnels, the material is heated before the 21-day anaerobic digestion process, where the resulting biogas is captured. On day 21, the tunnels are purged of any remaining methane (biogas) and oxygen is blown through the pile, Hanson explains. Then the material is removed and bulked. That same day, the material goes to an enclosed composting tunnel for another 21 days then is removed and stacked in piles outside to cure for screening, grading and marketing to landscape operations. Zanker Road Biogas will also be located near the city&rsquo;s existing wastewater treatment plant, the country&rsquo;s largest tertiary plant, which includes its own biogas process for the 100 million gallons of wastewater it processes per day, according to Michele Young, organics manager for the city of San Jose. The existing AD plant, which generates one-third of the treatment plant&rsquo;s power requirement, has made the new project a more welcome addition and hopefully will help curb citizen opposition. &ldquo;The public feels like renewable energy generation and this kind of technology innovation is one of the most appropriate uses of the land surrounding the wastewater treatment plant,&rdquo; Young syas. &ldquo;I think we have a very high interest rate in the technology and how it links to the activities that already are taking place in that area.&rdquo;&nbsp; Bilek hopes the facility will have a large and lasting impact on the city, as well as the rest of the country as it watches the plant&rsquo;s development and operation. &ldquo;I think that the large-scale examples have a larger impact, but they also have a really interesting story to tell and that becomes useful when project developers and people who are interested in advancing biogas projects can take that interesting story to their policy makers and show the amazing potential that biogas projects, especially at the large scale, really have for energy production,&rdquo; she says. Author: Lisa Gibson Associate Editor, Biomass Power &amp; Thermal &nbsp;(701) 738-4952 <a href="mailto:lgibson@bbiinternational.com">lgibson@bbiinternational.com</a>

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Collection Protection: Composted material is stored in the yard at Z-Best and will be used for landscaping. 

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Trash Talk: A truck dumps its load at the MSW tipping floor at GreenWaste\\\'s dirty materials recovery facility.

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San Jose, Calif., will be home to the country's first commercial organic waste dry anaerobic fermentation process, translated from applications across Europe and modified to create a reference and model for installations in the U.S. 

Zero Tolerance for Waste

When Hurricane Katrina struck in 2005, the Mississippi Baptist Medical Center in Jackson, Miss., remained open and operational despite the loss of grid power for several days, according to the U.S. DOE. This was because the hospital's combined-heat-and-power (CHP) system provided electricity, hot water and cooling service beyond what could be provided by its backup generators alone. The ability to produce electricity on-site rather than being reliant on the grid not only provides consistency and reliability for institutions such as hospitals where electricity is imperative, but also reduces grid congestion and avoids distribution costs. Those are only a few of the many outstanding benefits of CHP or cogeneration, and its widespread potential in the U.S. is looming. In fact, in 2008, the DOE published an in-depth report on the potential of CHP deployment in the country and determined that it is one of the most promising options in the country&rsquo;s energy efficiency portfolio. Notably, the report points out that while CHP has been around in one form or another for more than 100 years&mdash;it is a proven, not speculative, technology and still remains vastly underutilized even though it&rsquo;s one of the most compelling sources of energy efficiency that could, with even modest investments, quickly move the U.S. toward greater energy security and a cleaner environment. ABCs of CHP CHP is a form of distributed generation and is defined by the U.S. EPA as an integrated system that generates at least a portion of the electricity requirements of a building, facility or campus, and recycles the thermal energy exhausted from the electric generation; energy that would normally be wasted. Generally, CHP systems consist of several individual components, including a prime mover (heat engine), generator, heat recovery and electrical interconnection, all configured into an integrated whole. Prime movers for CHP systems such as steam turbines, gas or combustion turbines are capable of burning a variety of fuels, including biomass or biogas. According to the U.S. Energy Information Administration, reciprocating engines are the primary technology of choice and are used in about 47 percent of existing CHP systems in the U.S. Additional components used in configuring a complete CHP system include boilers, absorption chillers, desiccants, engine-driven chillers and gasifiers. While CHP systems can run on fossil fuels, there are many advantages to using biomass including reduced greenhouse gas/carbon dioxide emissions, local economic development, waste reduction and the security of a domestic fuel supply. In 2008, more than 60 percent of current biomass-powered electricity generation in the country was in the form of CHP, according to the EPA. Wood and other biomass fueled approximately 3 percent of existing U.S. CHP capacity. Christopher Recchia, executive director of the Biomass Energy Resource Center, says a good biomass CHP system candidate should be able to successfully source a local fuel supply such as low-grade wood that might have previously been used by pulp and paper but declined over time, or from plentiful forest land that isn&rsquo;t being successfully or actively managed. &ldquo;Or, if you&rsquo;re in a place like Nebraska, energy grass or agriculture residues that aren&rsquo;t being used might be a good source,&rdquo; Recchia says. Virginia-based nonprofit BERC is a leading organization involved in the assessment, development and management of community-scale biomass energy projects. BERC expertise includes biomass fuel systems, environmental policy and management, biomass fuel supply, and project and program management. Supporting Recchia&rsquo;s viewpoint is a biomass cogeneration project being developed by Iberdrola Renewables, set to break ground this fall in Lake County, Ore. Spokeswoman Jan Johnson says one of the most attractive qualities of implementing the project was the ability to secure a good biomass fuel supply partner. The 24-megawatt (MW) plant will be co-located with a sawmill and utilize its waste byproducts as feedstock, while in turn supplying the mill with steam.&nbsp; Once a biomass resource is secured, however, there are still a few other essential components involved in being a good candidate, Recchia says.&nbsp; Contemplating Candidacy &ldquo;One of the first things that should be done is to look at all of your buildings and gather any heat demand information you have,&rdquo; he says. &ldquo;If you have hourly data, that is great, but any data is good data.&rdquo; Next, a facility&rsquo;s existing system and fuel usage should be examined, whether it be coal, oil or natural gas, as well as whether there are multiple buildings already connected and if the existing system is steam-based or hot water based. &ldquo;A lot of colleges, for example, have steam-based systems,&rdquo; Recchia points out. &ldquo;Hot water is more efficient and modern, but we find that a lot of colleges are already committed to a steam distribution system and can&rsquo;t change that. That&rsquo;s okay, but if they don&rsquo;t currently have a distribution system we encourage a hot water system.&rdquo;&nbsp; If a medium- or large-sized college&mdash;which Reccia says BERC has typically found to be the best candidates for biomass CHP systems&mdash;wants to figure out if a system applies to their needs, they should also evaluate their energy demands and heat load system. &ldquo;We definitely support CHP but we also really support thermal-led CHP, which is when you&rsquo;re looking to maximize heating and cooling demands that you might have, and produce whatever amount of electricity proportionally, which can be supported by that type of system,&rdquo; he says. &ldquo;Otherwise, you may get into a situation where you&rsquo;re producing electricity, but you&rsquo;re wasting a lot of heat and that will reduce the economics of it.&rdquo; While people become excited about CHP, Reccia says what BERC generally finds is that the thermal side of CHP helps subsidize the electrical component. &ldquo;It is usually most cost effective if you do straight thermal and a little less cost effective if you do CHP, but there are a variety of reasons why people choose to go the CHP route. We&rsquo;re supportive of that, as long as you&rsquo;re trying to maximize the efficiency of the system overall,&rdquo; he says.&nbsp;&nbsp; Biomass CHP installation activity hasn&rsquo;t kept up with current interest because of the cost barriers, Reccia adds. &ldquo;Colleges are becoming interested in it because they climb onto the climate change commitment, and this is a very good way to help them with that,&rdquo; he says. &ldquo;So we&rsquo;ve seen an increased interest, but definitely not as many installations.&rdquo; Once deemed a good candidate for biomass CHP, there are other issues to consider. In particular, what kind of state or federal programs or incentives are available to help alleviate costs, as well as what might prevent a project from getting off the ground? Incentives and Barriers &nbsp;&nbsp;&nbsp; &nbsp; In addition to supporting research, in 2001 the DOE established the first of eight regional CHP, or clean energy application, centers to provide local technical assistance and educational support for CHP development. That same year, the EPA established the CHP Partnership Program, which encourages cost-effective CHP projects and the expansion of CHP development in under-utilized markets and applications. Other federal tax incentives that may be applicable to CHP include a Recovery Act production tax credit of 1.5 cents for any closed-loop biomass project and a 75-cent credit for any open-loop biomass project for the first 10 years, and a 10 percent investment tax credit for the first 15 MW of CHP systems under 50 MW placed into service between now and Jan. 1, 2017, under the Energy Improvement and Extension Act of 2008. For the past several years, many states have begun to realize that a variety of policy measures are needed to remove the barriers to CHP development, and have implemented a series of incentives, including adding CHP to receive credit under renewable portfolio standards (RPS). Currently, 13 states include CHP or waste energy recovery in their RPS. One recent push for CHP support occurred in North Carolina, which in August passed a 30 percent tax investment credit law for biomass CHP projects. Keith McAllister, director of the Southeast Clean Energy Application Center, says that CHP hasn&rsquo;t seen a lot of activity in the state, but that the interest level has been rising over the past few years, particularly for biomass-fueled projects. "The passage of this bill, which allows CHP fueled from any source to get the tax credit, should bring the bigger players to the table,&rdquo; he says, pointing out that there are still barriers to the market place. So, what are these barriers? Reccia says mainly, much like many new energy projects, initial capital cost is the culprit. &ldquo;Even though we can usually show a cost savings in one year by converting&mdash; particularly with fuel oil, natural gas a little less so&mdash;they are very capital intensive and a lot of colleges don&rsquo;t have that type of capital available, although they are in better positions than other public buildings that want to use this.&rdquo; In addition, where feasible, biomass CHP systems are factored at a comparatively higher cost than other fuel sources and vary based on the size of the application as well as the fuel type, according to Neeharika Naik-Dhungel, program manager of the EPA&rsquo;s CHP Partnership. &ldquo;For example, at a large wastewater treatment facility, successful turbine installation may be about 15 percent higher using biogas than natural gas, whereas a smaller biogas unit may cost twice as much than a comparable natural gas-fired CHP system,&rdquo; Naik-Dhungel says. &ldquo;This includes the cost of ancillary equipment such as piping, storage or a flare required to be installed for a biogas CHP However, these costs are one set of factors in a CHP development and are not the sole determinant of a successful CHP project. The benefits of a biomass CHP application, range from greenhouse gas reductions, energy cost savings, local economic development, waste reduction and the security of a domestic fuel supply.&rdquo; In addition, competition for biomass fuel supplies is intensifying in some regions, so a biomass CHP project may have difficulties securing a steady source or fuel contract. &nbsp;And while tax incentives might be good for biomass CHP projects, many colleges are tax exempt. &ldquo;So it wouldn&rsquo;t help them much unless they bring in a private entity or third party,&rdquo; Reccia adds. &ldquo;They would definitely make the money back, they just don&rsquo;t have it right now.&rdquo;&nbsp; Still, there will be continued activity in the future because of the role a biomass CHP system can potentially play in a sustainability strategy and in the renewable market. &ldquo;There has been steady activity in the market over the past three to four years,&rdquo; Naik-Dhungel says. &ldquo;Five to 15 biomass CHP systems are being planned at any given point with four to eight systems being installed in a year. Its growth will continue in sectors and applications where there are long-term sustainability commitments, and where the project financing lends to the application. There have been and continue to be applications in district energy systems on university campuses and for local government, wastewater utilities and other anaerobic applications such as dairy farms.&nbsp; In the industrial sector, there will be continued applications in the paper, chemical, wood products, and food processing industries, but only when feasible.&rdquo; Author: Anna Austin Associate Editor, Biomass Power &amp; Thermal (701) 738-4968 <a href="mailto:aaustin@bbiinternational.com">aaustin@bbiinternational.com</a>

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Biomass Energy Resource Director Christopher Recchia says medium- to large-sized college campuses are good candidates for biomass CHP systems. 

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Biomass cogeneration, or combined heat and power, applications are expected to move the U.S. toward greater energy security and a cleaner environment. 

Cogeneration Sensation

Posted Sept. 14, 2010
 
 Ireland-based Ceimici Novel Ltd. recently announced it has developed an innovative catalyst for use in new and existing biodiesel plants. According to the company, use of its unique catalyst can reduce production costs, increase profitability and results in 'greener' biodiesel production. 
 
 The catalytic material SCRO-80, which has been titled "Smart Catalyst," facilitates the transesterification process in minutes rather than hours, said Ben Engelen, Ceimici Novel's market developer. While Engelen was unable to disclose any information regarding the chemical structure or composition of SCRO-80, he did note that that the catalytic material "will not suffer from obsolescence."
 

 Unlike traditional biodiesel diesel catalysts that are consumed during the biodiesel production process, SCRO-80 can be recovered and reused. 
 
 "The transesterification is realized in a single stage and allows a full continuous operation," said Engelen. "Smart Catalyst performs the transesterification reaction as a true catalyst should-without being consumed. It is heterogeneous, which allows for easy recycling. It has high activity, which allows for the reaction to be taken to completion in a single reactor and the glycerol produced is a 98 percent grade. Good glycerol and a recycled catalyst provide about 80 percent of the benefits in switching to Smart Catalyst."
 
 According to Engelen, SCRO-80 can be employed in both new and existing biodiesel plants. Most existing plants are able to use the equipment that is already in place, he said. 
 
 "Without any problem, the smart catalyst can be added to the reactor as a direct replacement for the caustic catalyst," Engelen continued. "This requires no investment…The next stage would be to install intensive inline mixing equipment." 
 
 This is projected to cost approximately $70,000 for a 10 MMgy facility. "The loop is complete when you install further separation equipment to recycle the catalyst," he said, noting that this cost is relatively minor. 
 
 "Existing plants can increase their production capacity a number of times without major investment," Engelen continued. "We just have to solve possible bottlenecks in the rest of the plant, such as storage capacities." 
 New plants designed specifically to utilize SCRO-80 can be built with a much lower capital investment than traditional biodiesel facilities, Engelen said. 
 
 Ceimici Novel has tested SCRO-80 on the lab and demonstration scales. "We built a semi-continuous unit pilot plant that produces 1,800 kilograms of biodiesel per hour (540 gallons per hour), Engelen said. "Now we work with a 1000 kilogram (300 gallon) batch demonstration unit in the Netherlands, where in a simple CSTR (Continuous Stir Tank Reactor) we can achieve ASTM and EN 14214 specifications in the order of 6 minutes with triglyceride levels below 0.01 percent," he continued, noting that Ceimici Novel also has plans to perform a 10 ton (3,000 gallon) production demonstration for a group of South American-based biodiesel producers in mid-September. 
 
 According to Engelen, Ceimici Novel began to market SCRO-80 in July and recently appointed a U.S.-based distributor. 
 

 "At the moment we are working out the parameters for the savings and conditions of the technology license and royalty agreements," he said. "[When those] agreements are in place, we will be able to do any size scale test at customer's plants." 
 
 Ceimici Novel currently expects its catalyst to be employed on a commercial scale by late 2010 or early 2011.

Irish company develops new biodiesel catalyst

Opportunity Link Inc., a Havre, Mont.-based economic development agency, has been awarded a $125,000 grant from the Montana Department of Environmental Quality. The funding will support a project to develop railroad markets for biodiesel, which includes testing B20 in a Burlington Northern Santa Fe Railway engine. Two identical BNSF engines will be a part of the one-year project; one fueled with B20, the other with standard diesel. Researchers will periodically dismantle the engines to evaluate the comparative effects of each fuel.

Through Opportunity Link Inc.'s project, B20 will be evaluated in a BNSF Railway engine for one year. 'We are supportive of environmental initiatives to identify alternative fuel sources and opportunities to reduce emissions,' said BNSF spokesman Gus

2161-1294332279.jpg

BNSF train to run B20 trials

Posted Sept. 13, 2010

 
 Dexter, Mo.-based Global Fuels LLC recently received a $48,833 grant from the Missouri Department of Natural Resources to explore the technical and economic possibility of producing next generation biofuels. "We are going to use the feasibility study to compare the different technologies that are out there, to implement a new process here at our facility to produce either synthetic drop-in fuels," said Jason Harris, Global Fuels' plant manager, noting his company will also be looking into green chemical and green energy production technologies. 
 
 Global Fuels currently operates a 3 MMGy biodiesel plant that uses virgin oils and low free fatty acid grease and oil as feedstock. According to Harris, the main goal of the study is to find a technology that Global Fuels can operate sustainably without subsidy. "Given our current industry, where we are at with this $1 subsidy being lapse and the market being overproduced and [experiencing low demand], it's just something for us to look at for long-term stability," Harris continued. 
 
 The official timeline for the feasibility study is one year, however Harris said he hopes to have it complete within six months. "We're looking at several different companies that are either ready to commercialize, or are still in pilot facilities," he said. "We are looking at gasification, pyrolysis, fermentation-we're looking at a lot of technologies, and we hope to get it narrowed down to just a few by the end of the study." 
 
 Harris also notes that Global Fuels is hoping to find a technology that can utilize local biomass sources. "We're trying to keep an open mind and unbiased opinion starting out," he said. "We don't want to concentrate on one feedstock because that really narrows your study. We want to keep it open and broad, and that way we get a change to look at everything." Some possible feedstocks that are in abundance locally include agricultural residues, forestry, municipal solid waste, wood waste, construction waste, and manure. 
 
 One aspect of the study that is currently unclear is whether Global Fuels would continue to operate its biodiesel plant once a new technology is brought onsite. "That is one of the aspects we are still looking into," Harris said. The current thought, he continued, would be the continued operation of the biodiesel facility during the feasibility study and construction of a new plant. "After everything is up and running, we'll make the determination whether it's still feasible to use the biodiesel facility or not," he said.

Global Fuels receives feasibility study grant

Get your plane ticket, make your hotel reservations and register for BBI International's Southeast Biomass Conference & Trade Show, Nov. 2-4 at the Hyatt Regency in Atlanta. While much of the conference will be about biomass heat and power, refining biomass and similar topics, one panel at the show will be dedicated exclusively to methyl esters, titled, "Biodiesel from Waste and Low-Value Feedstocks." 
 
 I will be moderating this group of presenters. Christina Borgese, president of PreProcess Inc., a company that focuses on scaling up alternative energy systems from bench- to commercial-scale, will present on converting problematic material such as sewer sludge into process-ready feedstock for biodiesel production. Borgese, who comes from BioFuelBox, winner of a World Economic Forum award last year, said much discussion of low-value feedstock centers on conversion technology, not on pretreatment, economic separation or reducing the overall costs associated with such undesirable inputs. "We focus on a heated, intensified, layered approach," she said of PreProcess' separation technique. Borgese will cover the engineering and economics of grease separation-what has been done in the past, what is currently on the table, and what the future can hold. 
 
 Frank Yeboah, an assistant professor with North Carolina Agriculture and Technical University, will discuss his three-year biodiesel project with the U.S. Department of Defense. "We look to develop a simple computer model" that speaks to the economic viability of producing biodiesel from waste materials generated on military bases, such as used cooking oil from canteens, he said. But the computer model will also generate data on how much petroleum the military can displace from such activities, in addition to the environmental (i.e., greenhouse gas emissions reductions, etc.) and energy security benefits offered. Yeboah is in year two of the three-year DOD project and anticipates having the very latest data from the project to share with the audience in Atlanta. 
 
 Ming Chai, a Ph.D. student at the University of Cincinnati will discuss his collaboration with Bluegrass Biodiesel out of Falmouth, Ky., and plans to delve into the particulars of kinematics and acid-catalyzed esterification of free fatty acids. Chai will focus on issues associated with biodiesel conversion of used cooking oil and animal fat feedstock, in addition to trap grease, and will relay to the audience insights from his research. 
 
 Finally, Brandon Spence, CEO of Winnsboro, S.C.-based Midlands Biofuels, a 300,000 gallon per year community-scale biodiesel plant, will round out the biodiesel panel in Atlanta by discussing plant operations using waste vegetable oil, and the new Southern Fried Fuels initiative Midlands Biofuels just recently kicked off (see page 10). The initiative offers individuals a place to dispose of their used fryer grease instead of dumping it down the drain or throwing it away in landfills. Midlands Biofuels picks up the used oil from the drop-off center at the city of Columbia's Public Works Facility, and hauls the material to its Winnsboro-based methyl ester plant for conversion to quality biodiesel. 
 
 To register for the Southeast Biomass Conference & Trade Show in Atlanta Nov. 2-4, go to www.biomassconference.com/southeast.

2158-1294332278.jpg

Meet You in Atlanta

In most industries, the logistics and strategy of a company's distribution infrastructure depend primarily on cost. For example, as demand in a geographic area grows, it will eventually be more cost effective to produce in that area rather than continually ship from afar. While this analysis can get complicated, the biofuels industry must uniquely consider not only the dollars that go into shipping, but also the environmental impact. 

 
 As a biodiesel producer expands its market, critics, competitors and policymakers will scrutinize resources used to get the product to consumers. Regardless of whether this scrutiny is merited or ill-defined, it is certain to arise. Therefore, biodiesel producers are pushed toward multiple facilities, each ideally utilizing and servicing the immediately surrounding geographic areas. 
 
 With the expiration of the biodiesel tax credit and production at a small percentage of capacity, most producers likely feel that opening new facilities is an impossible task. Yet, as the industry faces a difficult market, it could be the ideal time for players to gain market share. Adding to the opportunity are a number of federal programs that can be utilized for undertaking a capital project toward expanding a biodiesel distribution network.
 
 New market tax credits The new market tax credit program was created as a way to direct funds to businesses located in low-income census districts. It provides an investor with a federal income tax credit equal to 39 percent of an investment in an intermediary entity, referred to as a community development entity, which loans the investor funds to the project. This loan must be interest-only for at least seven years and have an interest rate at least 25 percent below market rate. Under certain structures, a lender typically will discharge a substantial portion of the principal after seven years (after all, the lender has recouped its investment from the generous tax credit and often doesn't also need a return of the entire principal). 
 
 A biodiesel production facility will qualify for this financing as long as the project is located in a low-income census district. A liberal definition of low income covers almost 40 percent of the U.S., including many rural districts. A federal website mapping feature identifies whether an address is in a low-income census district: (http://www.cdfifund.gov/what_we_do/mapping.asp).
 
 Biorefinery assistance program USDA will guarantee loans for projects involving the development, construction and/or retrofitting of commercial-scale biorefineries producing advanced biofuels. The definition of advanced biofuel under this program will include biodiesel, as one of the categories includes "diesel-equivalent fuel derived from renewable biomass, including vegetable oil and animal fat." However, USDA has interpreted Congressional intent of the program to prefer innovative, commercial-scale technologies, and will therefore give preference to projects that go beyond standard biodiesel technology. 
 
 The maximum amount of any one loan guarantee is $250 million. Participation in this program will offer biodiesel producers an advantage with access to significant financing at rates lower than those for which they would otherwise be eligible. 
 
 Guaranteed loans Efficient use of feedstock supply will often cause a commercial-scale biodiesel production facility to locate in a rural area, creating an opportunity to use this loan guarantee program limited to rural businesses. Similar to the New Market Tax Credits, eligible geographic areas under this program are plentiful-the only constraints being that the territory is not within the outer boundary of any city having a population of 50,000 or more and its immediately urbanized and urbanizing area with a population density of more than 100 people per square mile. A wide range of businesses are eligible to participate in this program and benefit from a loan guarantee by USDA, including biodiesel companies looking to purchase real estate or equipment for a production facility.

 
 If the borrower meets some financial requirements, USDA will guarantee a portion of a loan in amounts more than $10 million. Specifically, USDA will guarantee 80 percent of a loan up to $5 million, 70 percent of a loan up to $10 million, and 60 percent of a loan of more than $10 million. Once again, the USDA guarantee will provide producers with access to lower interest rates on their financings. 
 
 A distribution network that minimizes environmental impact is necessary for successful biodiesel market penetration. While current market forces do not encourage expanding capacity, these federal programs may offer producers the capability to do so, thereby positioning themselves well for a more favorable market in the future.
 
 
 Craig Johnson is a member of the Renewable Energy, Business and Health Care Practice Groups in the Madison office at Michael Best & Friedrich LLP. Reach him at (608) 257-3064 or cjjohnson@michaelbest.com.

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Leveraging Federal Programs to Expand Distribution Networks

Plenty of confusion has surfaced recently regarding the impact of a 2010 advanced biofuel standard for obligated parties. The 2010 advanced biofuel requirement of 0.95 billion gallons would, in theory, be met by the biomass-based diesel standard for 2010 using simple RFS2 math: the equivalence value of biodiesel (1.5), multiplied by the mandated volume of biomass-based diesel for 2010 (0.65 billion gallons) equals 0.975 billion gallons. Since biodiesel is nested within the advanced biofuels standard, and since the above number exceeds 0.95 billion gallons, the advanced biofuel standard would be automatically met. Case closed, right? 
 
 Well, that depends on your outlook for biodiesel production for the remainder of 2010, and for this we first look to the Energy Information Administration. EIA biodiesel production figures show an industry that is producing approximately 34 million gallons per month for the first half of 2010. EIA's June Monthly Energy Review shows a net deficit between biodiesel imports and exports of 737,000 barrels, or roughly 31 million gallons, during the first quarter of 2010. When biodiesel is exported, RFS2 statutes demand that exporting parties establish a renewable volume obligation in biomass-based diesel using the physical volume exported, multiplied by its equivalence value. Removing biodiesel gallon renewable identification number (RIN) credits from the domestic pool by exporting biodiesel simply demands more domestically consumed biodiesel to make up the deficit. Without a substantial increase in biodiesel production over the second half of 2010, combined with a large decrease in net exports, it is possible that less than 300 million gallons of domestically consumed biodiesel (and their 450 million associated RINS) will be available to meet the combined 2009-'10 biomass-based diesel standard. 
 
 The EPA projects RFS2 regulatory levels of 2010 biodiesel consumption within their revised Q&A document released in July, stating: "Based on our current review of the 2009 RFS compliance report data submitted by obligated parties, we anticipate that this straight reading of the regulations would require obligated parties to obtain 2010 biomass-based diesel RINs representing approximately 345 million gallons (518 million RINs) after accounting for 2008 and 2009 RINs that EPA believes may be properly applied to the combined 2009-'10 biomass-based diesel requirement of 1.15 billion gallons." 
 
 And how does this impact the 2010 advanced biofuel standard? EPA explains: "If 345 million gallons of 2010 biodiesel (or the equivalent of 518 million RINs) are used in satisfying the combined 2009-'10 biomass-based diesel standard, these RINs would also be valid for meeting the 2010 advanced biofuel standard of 950 million gallons. However, an additional 432 million advanced biofuel RINs would still be required to meet the 2010 advanced biofuel standard ... Such biofuels could potentially include U.S. biodiesel production in excess of 345 million gallons, cellulosic biofuel RINs with a D code of 1, 3, or 7 in excess of the 6.5 million ethanol-equivalent gallons needed for 2010 compliance, or imported sugarcane ethanol RINs with a D code of 5. In addition, while up to 190 million RINs from 2009 could be used toward meeting the 2010 advanced biofuels requirement consistent with the applicable 20 percent rollover cap, only excess 2009 biodiesel or renewable diesel or cellulosic ethanol RINs (that is, RINs not used for compliance in 2009) could be used for this purpose."
 

 What does this all mean to RFS2 obligated parties? Initially, the 20 percent rollover cap for this year's advanced biofuel standard allows up to 190 million cellulosic or biodiesel RINs from 2009 to be used for compliance with the 2010 advanced biofuel standard. Obligated parties will be well-suited to purchase the cheaper of 2009 cellulosic or biomass-based diesel RINs to satisfy this quantity of RINs. Once this volume has been acquired, the same metric applies to 2010 cellulosic/biomass-based diesel/advanced biofuels RINs: buy the cheapest RIN, or purchase the cheapest biofuel to separate the necessary RINs required to satisfy their remaining 2010 advanced biofuel obligation. With 2009 biodiesel and cellulosic RINs selling for just over one cent, and with comparable 2010 advanced RINs approaching 50 cents, it is easy to see that parties who are well versed in the RFS2 regulations will be able to shave millions off their 2010 compliance costs.
 
 
 Sam Gray is a fuel trader with Ft. Worth, Texas-based VICNRG LLC. Reach him at (404) 293-5884 or sam.gray@vicfuel.com.

RFS2 Compliance for Obligated Parties

Residents of Columbia, S.C., can now put their waste cooking oil to good use by dropping it off for collection by Winnsboro, S.C.-based biodiesel producer Midlands Biofuels LLC, for use as biodiesel feedstock. The effort, dubbed the Southern Fried Fuel Initiative, was launched to decrease the large volume of waste cooking oil dumped in the city's sewer systems. The company expects to collect approximately 1,000 to 2,000 gallons a month of waste cooking oil from 125-gallon containers scattered at various collection locations in the city. Once collected and delivered to its 300,000-gallon-per-year facility in Winnsboro, the company intends to supply B20 blends to the garbage truck fleet in Columbia.

photo: City of Columbia's Public Relations, Marketing and Media Department

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Southern Fried Fuel  Initiative launched in SC

The disparity between diesel and biodiesel prices has become increasingly noticeable in recent months. Since April, when the national average price was $3.05 per gallon, on-road diesel prices dropped off 10 cents to $2.95 in August, according to the Energy Information Administration. The national average price for B20 and B100 in April was $3.12 and $3.57 per gallon, respectively, according to the U.S. DOE's Clean Cities Alternative Fuels Price Report published in April.

Diesel price drop may signify  shortcoming for biodiesel

Before Congress reconvened on Sept. 13, the latest news on the biodiesel tax incentive extension remained linked to one thing: Congress. After struggling to find a capable legislative vehicle early this year, many believed the tax extension would finally pass in the unemployment bill, but shortly before the bill went to the Senate floor, the biodiesel portion was stripped. The next opportunity, the small business bill, came as Congress was leaving for August recess, but a biodiesel amendment approved by both parties from Sen. Charles Grassley, R-Iowa, also fell prey to the political wrangling of Congress. With Congress back in session, the best chance still remains in a revisited, new version of the small business bill. Sen. John Kerry, D-Mass., has also proposed an energy bill that would reinstate and extend the tax incentive for two years, but to date, the bill has seen minimal attention.

Tax Credit Update

The genetic code for the promising biofuel feedstock, jatropha, just got much clearer. Energy crop developer SG Biofuels, with the help of a biotechnology provider Life Technologies used a genome sequencing device called the Solid 4.0 system to sequence the jatropha genome. SG Biofuels will add the genome to its well-established germplasm library in an effort to further develop a high quality reference genome. The results of the Life Technologies partnership along with the current library will help the San Diego-based company to more quickly identify key traits including enhanced fruit yield, pest resistance, soil adaptation, improved flowering capabilities, uniformity and harvesting. 
 
 The ultimate goal for SG Biofuels, however, is to develop its Jmax Jatropha Optimization platform, which features a proprietary cultivar of jatropha yielding 100 percent more than existing varieties, increasing profitability to $1,000 more per hectare. Those interested in participating in the Jmax program will also have access to the germplasm library and its plant science team to help growers and breeders optimize selection for specific regional conditions, including climate and soil conditions.

Jatropha genome successfully sequenced

New Mexico Gov. Bill Richardson recently announced that $200,000 in Recovery Act funding has been awarded to New Mexico State University. A portion of that funding will be used by NMSU's Renewable Energy, Water and Arid Lands Task Force to support an algae project that includes the development of test beds that will be used to evaluate algae strains and determine which strain is best adapted for cultivation in New Mexico. 
 
 As part of the project, researchers will evaluate several aspects of algae production, including yields, harvest methods, extraction and performance. The project will also include research into the effects of environmental factors, such as temperature and water quality, on algae growth and performance. "The state of New Mexico would be the primary region to benefit from the project, but that doesn't mean other places that have similar water chemistries and similar environments won't be able to benefit from it," said Abbas Ghassemi, NMSU professor of chemical engineering and director of the Institute of Energy and Environment.

Recovery Act funds  New Mexico algae project

A 200-acre test plot of land near Salt Lake City's airport is drawing interest from the U.S. Army to evaluate whether it can exploit similar underutilized land on government property near military installations to grow oilseed feedstocks for biodiesel production, according to Dallas Hanks, doctoral student at Utah State University's department of plants, soils and climate. The effort, part of the Freeways-to-Fuel Initiative and spearheaded by Hanks in 2007, focuses on ways to grow various oilseed crops on nontraditional agronomic areas such as along roadways, airports, railroad areas and other government lands.

Dallas Hanks, Utah State University Extension doctoral student, inspects crops in a Freeways-to-Fuel test plot in Utah. PHOTO: Utah State University Exension

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Utah biodiesel plot draws interest of US military

Several companies once exclusively billed as cellulosic ethanol producers have widened their focus to include the production of higher-value biobased chemicals and drop-in substitutes. One example is Broomfield, Colo.-based Range Fuels Inc., which recently produced its first batch of cellulosic methanol at its Soperton, Ga., facility. In Wisconsin, Flambeau River Biofuels shelved its cellulosic ethanol project long ago, and is now focused on the gasification of woody biomass to produce renewable diesel and paraffin wax. In addition, BlueFire Ethanol Fuels Inc. recently changed its name to BlueFire Renewables Inc. to better illustrate its ability to produce other advanced fuels. While BlueFire's first two facilities will initially produce cellulosic ethanol, the company plans to eventually produce other products.

PHOTO: Utah State University Exension

Surrounded by members of New York City's biodiesel industry, Mayor Michael Bloomberg signed Intro 194-A, validating a three-year struggle to bring biodiesel and heating oil together. The bill, originally sponsored by the Chairman of the New York City Council Environmental Protection Committee, James Gennaro, requires all grades of heating oil sold in the city to contain at least 2 percent biodiesel starting in October 2012. While the infusion of biodiesel into the Big Apple's heating oil supply will have to wait a few years, the impact of the bill immediately resonates to the rest of the country, according to Gennaro.
 
 "When people see all the brainwaves we put into debunking some of the myths about biodiesel and biofuels," Gennaro told Biodiesel Magazine, "it will go a long ways against those that harbor reservations about a fuel that can provide environmental benefits." For Gennaro and others involved with making the biodiesel heating oil bill a reality, fighting against those who didn't know the truth about biodiesel benefits made the process difficult-but in the end, "we finally prevailed," Gennaro said. 
 
 To satisfy the B2 mandate, 20 million gallons of B100 will be needed, and according to Gennaro, part of the success of the bill directly relates to one of New York City's main biodiesel suppliers, Metro Biofuels. "We are already seeing a big investment in biodiesel heating oil," he said, and, "Metro is doing that by putting their money where their mouth is." In the first quarter of 2011, Metro will open a 110 MMgy biodiesel processing facility in Brooklyn, capable of using soy, grease, canola or algae as feedstock. Gene Pullo, president and CEO of Metro said that as more and more people started using biodiesel-blended heating oil, they began to question why all heating oil didn't include biodiesel. During the three years before the bill became official, Pullo said, "As a company, we spent a lot of time building relationships with environmental and public health organizations, and working with policymakers to understand our businesses and how it can benefit the city." The key, he added, was working together, and "never giving up." 
 
 The result of that hard work is a mandate, Pullo said, that confirms all the hard work and the belief that biodiesel is a major component of our energy future. Gennaro would agree, but he also emphasizes the importance of the mandate for those outside the city. "This is a significant day for NYC and those other cities that are trying to make common sense energy policies," adding, "There are sources out there that don't tell the real story. We've created a body of work that people should look at and emulate." And, as for alternative legislation on biodiesel blending heating oil, "there is no need to reinvent the wheel." 
 
 "I actually call it sexy," said Daniel Falcone, wholesale manager for Ultra Green Energy Services LLC. There's no denying this looks good to the industry, Falcone added. The success of the bill, however, doesn't mean biodiesel use in the city won't change. Pullo said, "We expect that once building owners get started on biodiesel at a 2 percent blend, they will love it and eventually blend up to B5, B10 and B20."

Support for biodiesel was strong at the official signing of the B2 heating oil bill held in the Blue Room at New York City Hall. PHOTO: DANIEL FALCONE, ULTRA GREEN ENERGY SERVICES

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New York City passes B2 heating oil mandate

In an industry where declining diesel prices, increasing inventories and a lapse of a major tax credit continue to crimp operating profits, it would seem that the storm clouds have converged, causing many in the industry to ponder shuttering operations. Several biodiesel plants have either declared success or have successfully come online in this uncertain time.
 

 Among those in recent months is the opening of small-scale facilities able to serve local communities. In Alabama, a 70,000-gallon-per-year biodiesel facility opened at the Enterprise Public Works Facility where it will use waste cooking oil supplied by local businesses and a high school. The plant received a $300,000 grant from Alabama Department of Economic and Community Affairs, which looked to partner with surrounding communities for feedstock access and fuel supply agreements.
 
 In Groton, Conn., Constitution Biofuels started up operations and held a grand opening recently. The company produced its first batch of fuel, about 250 gallons, in late August, and hoped to increase production for local commercial sales by late September, according to founder and CEO Doug Dickey. The plant will use waste cooking oil collected from area restaurants and Dickey estimated approximately 3,500 gallons of waste product would be converted into biodiesel. 
 
 Large-scale plants also found new life when Renewable Energy Group Inc. reopened a 60 MMgy plant in Seneca, Ill. REG acquired the idled facility in April when its original owner, Nova Biosource Fuels Inc., went bankrupt. The multifeedstock plant features three side-by-side 20 MMgy biodiesel processing units, a technical-grade glycerin refining facility, raw material and finished product storage, and railcar and truck loading. 
 
 Evansville, Ind.-based Imperial Petroleum Inc. said that its wholly-owned subsidiary e-Biofuels LLC, which operates a 15 MMgy plant in Middletown, Ind., using animal fats and waste vegetable oils as feedstock, generated approximately $3.5 million in July alone on fuel sales of about 1.2 million gallons and, as a result, expected "to be highly profitable going forward," the company said. Fuel sales for August were approximately 1.4 million gallons with revenues of more than $4 million, according to the company. 
 
 "E-Biofuels LLC has been in a unique position to take advantage of its certification as an advanced biofuels producer to rapidly increase its market presence," said Imperial Petroleum CEO Jeff Wilson, adding that his company intends to increase the plant's maximum installed nameplate capacity to 25 MMgy and add more efficient process technology to include bio jet fuel capabilities.
 
 Plants that suffered a different fate by closing operations include Biocardel Vermont LLC's 4 MMgy multifeedstock plant in Swanton, Vt. Best BioDiesel Cashton LLC, a subsidiary of Madison, Wis.-based Best Energies Inc., shut down operations at its 8 MMgy facility in Cashton, Wis. Both plants cited the lapse of the biodiesel tax credit being the primary cause behind the decisions to close their respective facilities.

Company personnel held a ribbon-cutting ceremony to commemorate the reopening of REG's recently acquired 60 MMgy biodiesel plant in Seneca, Ill. PHOTO: REG INC.

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Plants come online despite tough times

Current biodiesel production methods involve catalysts made of concentrated sulfuric acids and caustic methoxides, which "creates a whole host of problems," according to Tyson Johnson, CFO of Georgia-based biodiesel research facility, Down to Earth Energy. Johnson and his research team from the University of Georgia may have found the answer, and it starts with catalyst recycling. "We've taken effective catalytic functional groups and immobilized them on a solid substrate," Johnson said. The functional catalyst groups created by Down to Earth look and feel a lot like charcoal, Johnson said, and when the catalysts remain in a fixed column, the process allows for additional catalyst use in future reactions.
 
 Made from readily available, natural woody biomass, the catalyst process drastically cuts down on the waste effluents from conventional production methods, according to Johnson, "because the process does not require the addition of acids and caustics." The recycling method subsequently produces a glycerin product largely free of soaps, salts and will be pH neutral. "The lack of those impurities will make separations much easier and reduce the amount of biodiesel that gets carried over with the glycerin." 
 
 The catalyst also acts as an adsorbent, and this allows some front-end impurities to adsorb on the catalyst surface. But, Johnson said, this creates a trade-off. "The dirtier the oil going in, the shorter the life of the catalyst, and the shorter the amount of time before regeneration is necessary," so Johnson added, producers will want to stick with their current filtering and dewatering setups. 
 
 While Johnson's goal is to give every biodiesel producer, regardless of size, an affordable solid catalyst that can be easily integrated into both batch or continuous processes, those interested in the recyclable catalyst method will have to wait. With the technology still in the development stages, the team is struggling to find the time necessary for research and development, while playing "the grant-seeking game which requires long hours and no guarantees," according to Johnson. The work is currently being funded by U.S. EPA, along with supplements from the Georgia Research Alliance. "We have not yet begun seeking out private money and probably won't begin to do so until we have rounded out performance and data," Johnson said. 

 
 Along with process development and testing, the Down to Earth team is also working to form relationships that will get the catalysts to market, and some early ones have already paid off. Jim Kastner from UGA's Agriculture Engineering Department and Dan Geller from the UGA's Engineering Outreach program have already been instrumental in development of the project. "The initial idea for the project came from Jim and Dan, both of whom have been working with biochar and pyrolysis technologies for some time now," Johnson said. Plans for commercialization, including pilot testing and market implementation, are currently scheduled for summer 2011 and will most likely stretch into 2012. In the meantime, Johnson and his team, which also includes Down to Earth chemist Larry Keith and others, are "focused on giving this technology in its current form the best chance," and although the future goal of the project may sound like an idea that's been used before, Johnson said the project so far has been a success.

Down to Earth Energy's team hopes to bring its recyclable catalyst to market by 2011. PHOTO: DOWN TO EARTH ENERGY

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Recycled catalyst process developed

Researchers at the University of Michigan may have unlocked algae's true potential as a viable feedstock for biodiesel production. The team published a feasibility paper detailing its novel two-step hydrolysis-solvolysis process that can produce biodiesel directly from wet algal biomass, obviating the need for costly biomass drying, organic solvent extraction and catalysts while providing a mechanism for nutrient recycling. The paper on the process was published in the ACS journal Energy & Fuels. 
 
 In the first step, a strain of algae called Chlorella vulgaris, grown sequentially under phototrophic and heterotrophic conditions, was comprised of 80 percent moisture and had a 53.3 percent lipid content. The wet algal biomass then underwent a reaction under subcritical water conditions in temperatures of 250 degrees Celsius, which transformed the wet algae into a paste-like state, according to Phillip Savage, lead researcher on the project. "At large scale that probably wouldn't be applicable for an economical process," he noted.
 
 The goal here, according to researcher Robert Levine who authored the paper, was to hydrolyze-separate from water-intracellular lipids and conglomerate them into an easily filterable solid that retained high lipid content. 
 
 "We wanted to convert the lipids into mostly fatty acids in the form of triglycerides or other phospholipids that contained fatty acid groups, so we could hydrolyze those into fatty acids," he said. "We also wanted to release a lot of the nonlipid components into a sterile nutrient-rich aqueous phase that we could recycle into our process from which we could grow additional microorganisms."
 
 In the second step, the remaining solids (containing approximately 80 to 90 percent fatty acids) underwent a supercritical transesterification process with ethanol that produced fatty acid ethyl esters (FAEE). "We chose ethanol instead of methanol because we wanted to use entirely biologically-derived ingredients, and also because the solid that remained after the process will probably have some minor alcohol residue, which we want to be used as fertilizer, animal feed and so forth," Levine said.
 
 Levine found that the yields of FAEE in the crude product were significantly lower than anticipated due to nominal amounts of unreacted glycerides and unidentified compounds."We definitely have more work to do to optimize the process," Levine said. "Eventually we want to get 100 percent crude biodiesel and 100 percent ethyl esters."
 
 Though the experiment yielded promising results, Levine said the process warrants further optimization efforts to overcome glaring variables pertaining to temperature, time and alcohol use. "We use a higher ratio of alcohol-to-oil, that's common in a normal, catalyzed commercial biodiesel plant," he said. "The triglyceride-to-alcohol ratio of one-to-three is stoichiometric, so we're really moving towards just using just enough alcohol so we don't have to recover it, which would save on recovery costs."
 
 Once perfected, Levine added that the process could be applied to larger scale biodiesel production processes. "Our process can actually be very efficient if you do heat integration on your inlet and outlet streams, there's a big advantage to using higher temperatures and pressures," he said.

Pictured is a process flow diagram for biodiesel production through intracellular lipid hydrolysis and supercritical in situ transesterification using ethanol. source: Robert Levine, UNIVERSITY OF MICHIGAN

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Researchers explore direct conversion of wet algal biomass

Biodiesel training initiatives are gaining traction all over the country. Although some of these programs have been established in traditional biodiesel production areas, others are centered in regions where biodiesel is relatively rare. One program in Iowa is focused on training diesel technicians on the use of biodiesel, while another in Minnesota aims to train displaced workers to work in biodiesel plants. In New Orleans, a local nonprofit is working to develop a program that will train low-income, at-risk youth on biodiesel production and use. In addition, a program led by two Clean Cities departments in North Carolina aims to educate both fleet managers and the general public on the benefits and use of biodiesel. 

 In Iowa, a training initiative established by the Iowa Biodiesel Board has trained more than 750 diesel technicians and students in the past year. The program, which specifically targets the state's diesel mechanic community and community college instructors, aims to increase professional knowledge on biodiesel and its performance in diesel engines. A grant awarded by the Iowa Power Fund has fully funded the initiative. 
 During the first year of the program, continuing education courses for diesel mechanics in the workforce were held at all 15 of Iowa's community colleges. A two-day "train the trainer" workshop was also offered to college faculty in September 2009, where instructors were provided with biodiesel curriculum and had the opportunity to interact with industry experts. A follow-up meeting was held this spring, at which instructors shared experiences and received curriculum updates. 
 The feedback received from students has been overwhelmingly positive, said Jerry Burns, an associate professor at Des Moines Area Community College. He also noted that most students were not familiar with biodiesel's benefits before taking his class. Specifically, he said many students were unaware of biodiesel's enhanced lubrication value and the impact that the fuel can have on exhaust emissions. 
 When people take their vehicles to a technician or mechanic, they put trust in them so if customers are told biodiesel is bad, they probably won't try it, Burns said. However, if those technicians and mechanics are able to explain the benefits of biodiesel, drivers should be more willing to try it. Students will take the knowledge into the workforce and be better able to educate people on biodiesel, Burns said. 
 In Minnesota, a program funded by the Governor's Workforce Development Council seeks to provide free biofuels training to up to 44 participants. The one-year training program, which is being developed by Anoka-Ramsey Community College in east-central Minnesota, will select participants from a target population that includes military veterans, displaced workers and incumbent employees. According to Stephen Jones, the college's director of continuing education and customized training, participants are being recruited through the Anoka County Workforce Center and the Central Minnesota Training Partnership Program. 
 Students participating in the program will receive training in biofuels fundamentals, technical report writing, spreadsheet use, and OSHA safety standards. The course includes existing online course work, experiential lessons within production facilities and virtual tours of existing plants. Students will also perform instructor-led classroom activities and participate in production control computer simulations. 
 In Louisiana, New Orleans-based nonprofit Operation Reach Inc. formed the "Gulfsouth Youth Biodiesel Project," which aims to provide green job training to youth who reside in local low-income communities. According to Hamilton Simons-Jones, Operation Reach's chief development officer, the GYBP is now in its second year. "We originally formed this project about a year and a half go to accomplish two things," he said. "One is to be a small, biodiesel social enterprise that converts used cooking oil into biodiesel fuel as a local, regional business run by the nonprofit. The second is to develop green job training and expose local youth to biodiesel to really use that as an introduction not only to overall environmental awareness, but also more concrete job training."
 The GYBP program graduated its first class of 15 students in April, and the next class of students will begin the program this fall. According to Simons-Jones, the first class actually helped assemble the teaching facility, which includes a biodiesel plant. The experience allowed the participating students to earn a construction certification through the National Center for Construction, Education and Research. "[The students] received instruction on pipe fitting, plumbing and carpentry," Simons-Jones continued. "They were a part of helping us build out this teaching facility that produces biodiesel, and then learning about how that all works as well, of course." Depending on the amount of funding that is received, approximately 30 students will be able to participate this fall. 
 While the Minnesota and New Orleans projects aim to provide training to disadvantaged youth and workers, an initiative lead by two Clean Cities offices in North Carolina is working to educate fleet managers and the general public on the benefits and use of biodiesel. The program, which was funded by United Soybean Board grant, includes four workshops. Each of the Clean Cities departments is hosting two regional training sessions; one aimed at fleet managers, and one aimed at the public. 
 Two workshops held in the Charlotte, N.C., area featured a local biodiesel expert, a panel of fleet managers already using biodiesel, and a representative of the Greater Charlotte Region Biofuel Facility Project, said Centralina Clean Fuels Coalition Assistant Coordinator Emily Parker. Two similar events held in Raleigh featured an expert from the North Carolina Biofuels Center, a representative of a local community college and a local biodiesel producer. According to Kathy Boyer, the Triangle Clean Cities Coordinator in Raleigh, her office anticipates applying for additional grant funding in the next year to support the development of more workshops. "I think maybe in this next round we will target heavy-duty truck drivers, convenience store owners and people who would be using the fuel in the public sector," she said.

Operation Reach staff member Clay Alexander (top right) is pictured with the first graduating class of the organization's Gulfsouth Youth Biodiesel Project. Photo: OPERATION REACH INC.

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Training targets mechanics, youth and displaced workers

As the head of the National Biodiesel Board's Washington office, I have the privilege of working with biodiesel producers and stakeholders from across the country. Over the past year, regardless of their size or business model, I have heard a common sentiment from biodiesel producers. The biggest challenge facing our industry is uncertainty. Unreliable, inconsistent federal policy and the marketplace volatility it has caused is making it nearly impossible for our industry's entrepreneurs-the very individuals responsible for producing America's only commercial advanced biofuel-to make the important business decisions that will allow the nation to recognize significant economic, energy security and environmental benefits associated with expanded biodiesel production and use. 
 
 That is why the renewable fuels standard, RFS2, is so important. Between now and 2022, RFS2 requires obligated parties to use minimum amounts of biomass-based diesel and other advanced biofuels each year. Successful implementation of the RFS2 biomass-based diesel and advanced biofuels requirements will help provide a stable, reliable and enforceable demand for biodiesel in the U.S. marketplace. For this reason, the NBB has spent a significant amount of time, effort and resources working initially with Congress and subsequently with U.S. EPA to create and implement a workable program that achieves the worthwhile policy goal of displacing petroleum with advanced biofuels such as biodiesel. 
 On July 20, the EPA issued a proposed rule regarding the 2011 volume requirements for biomass-based diesel. Consistent with the law, the EPA proposed that 800 million gallons of biodiesel must be entered and used in the commercial marketplace in 2011. 
 
 In comments NBB filed on August 18, we supported this requirement and agreed with EPA that the U.S. biodiesel industry can not only meet, but exceed, 800 million gallons of production in 2011. With more than 80 biodiesel plants registered under the RFS2 program, representing more than 1.8 billion gallons of production capacity, and the abundance of feedstock available, the U.S. biodiesel industry stands ready to produce the fuel needed to satisfy and surpass the RFS2 volume requirements for 2011 and beyond.
 

 The NBB also took the opportunity in these comments to clarify the fundamental fact that, by law, the RFS2 volume requirements for biomass-based diesel and advanced biofuels must be met regardless of the status of the biodiesel tax incentive or other biofuels tax incentives. There has been some confusion about this issue, and we specifically noted the following in our comments:
 
 "In any event, although obligated parties continue to highlight the lack of the tax credit as a reason to avoid using biodiesel for compliance purposes in 2010, the tax credit itself is not germane to the specific statutory volume mandates of the RFS2 program enacted by Congress. The presence of the biodiesel tax credit should not be part of EPA's consideration when setting the annual renewable volume obligations. Specifically, Congress did not create the RFS2 volume requirements contingent on the availability of tax credits for biofuels, rather Congress created the RFS2 and imposed the volume requirements for a multitude of reasons: to decrease reliance on petroleum; to increase the environmental and air quality benefits of transportation fuels; to create new domestic green jobs; and to stimulate the development of new domestic feedstocks for biofuels."
 
 The EPA has clearly taken a step in the right direction by acknowledging that the U.S. biodiesel industry has the production capacity and feedstock available to accommodate the proposed RFS2 volume goal of 800 million gallons for 2011. The U.S. biodiesel industry has done, and will continue to do, its part to fulfill the statutory directive and goals. The NBB is confident that the U.S. biodiesel industry will produce more than 800 million gallons of fuel in 2011, so long as the EPA finalizes and enforces this proposal in a timely manner. 
 Successful implementation and enforcement of the RFS2 biomass-based diesel and advanced biofuels volume requirements will provide needed certainty for the U.S. biodiesel industry. Rest assured, achieving this worthwhile goal has been, and will remain, a top priority for the NBB. 
 
 To view the comments filed by the NBB, please visit www.regulations.gov and look through Docket ID. No. EPA-HQ-OAR-2010-0133.
 
 Manning Feraci, vice president of federal affairs, National Biodiesel Board

U.S. Biodiesel Industry Stands Ready to Meet, Exceed RFS2 Volume Goals

Plan now to participate in the biodiesel event of the year. The annual National Biodiesel Conference & Expo is the only event that gathers biodiesel decision-makers from all around the United States and the world. Opportunities abound for attendees and exhibitors to network, connect and learn. This event will explore the topics of governmental policy, technical issues and marketing trends in the biodiesel industry.
 
 2011 is shaping up to be a banner year for biodiesel production and industry growth. Our hope is that this conference will be the springboard to greater opportunities for our industry.
 "The demographics of the conference attendees indicate most are high-level decision-makers in their respective areas," said NBB CEO Joe Jobe. "This conference truly has developed into an annual 'meeting of the minds,' and you just have to be there to be part of it."
 
 The 2011 conference, to be held at the Phoenix Convention Center, will include an array of networking and social events in this exciting city, along with our always popular Expo. 

 The attendee early bird registration deadline is Nov. 19. Registering before this date will help save you money on your conference registration. 
 
 Visit the official conference website at www.biodieselconference.org for easy online registration. The website is also home to schedules, lodging information, area attractions, and many other helpful links.

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2011 Biodiesel Conference & Expo-register now!

The summer of 2010 can safely be classified as the summer of the biodiesel tax incentive. National Biodiesel Board staff and members focused on the renewal of the biodiesel tax incentive and hosted many media and Congressional events across the country.
 
 NBB took the opportunity during the August recess to host an energy media event with Congressman Roy Blunt, R-Mo., and Joe Jobe, NBB CEO. The two addressed a room full of reporters and biodiesel stakeholders on issues regarding the biodiesel tax incentive and the future of the biodiesel industry. 
 
 NBB members got involved with the grassroots effort by meeting with Senators and Representatives in Washington, over the phone, and by hosting events at production facilities. NBB provided support for members through talking points, message development, event advisory/press release support, media contacts, and other tips that helped maximize media exposure.
 
 NBB member General Biodiesel Inc. hosted Sen. Maria Cantwell, D-Wash., for a tour of its production facility in Seattle, followed by a press conference addressing the need to extend the biodiesel tax incentive. Cantwell said the credit was essential to protecting and creating 350 jobs in Washington State alone. 
 
 NBB member BlackGold Biofuels hosted Pennsylvania Democratic Senatorial candidate, and current U.S. Representative Joe Sestak, D-Pa., for a press conference at their Philadelphia Research and Development facility. 
 
 NBB member Renewable Energy Group Inc. hosted U.S. Rep. Debbie Halvorson, D-Ill., at a plant reopening in Seneca, Ill. Halvorson toured the production facility and addressed attendees and members of the media at the ribbon cutting ceremony. Halvorson voiced her strong support for the biodiesel tax incentive, stating the need for market security within the biofuels industry.
 
 NBB member Emergent Green Energy Inc. hosted Sen. Sam Brownback, R-Kan., at its Minneola, Kan., production facility. During the press event, Brownback said tax support is key to keeping biodiesel production facilities going.
 

 These events were just a handful of contacts biodiesel stakeholders made with Congress since the lapse of the biodiesel tax incentive on Dec. 31. While the time without the incentive has been hard on the industry, NBB and its members are taking every opportunity to build relationships in Congress and to educate leaders on the benefits of biodiesel.

NBB and members work to build relationships, educate Congress

The World Bank recently released a report that reversed its claims faulting biofuels for food price increases. The National Biodiesel Board's communications team issued a press release and used social media to bring attention to the recent report. 
 
 The report, "Placing the 2006/08 Commodity Price Boom into Perspective," drastically reduces estimates of biofuels impact on commodity prices. World Bank economists now say that initial estimates were too high and note, "This paper concludes that a stronger link between energy and nonenergy commodity prices is likely to be the dominant influence on developments in commodity, and especially food, markets." 
 
 The initial study done by the World Bank was the basis of many opponents' claims in the food vs. fuel debate.
 
 "Food price inflation of 2008 was all about energy price inflation and the oil shock," said NBB CEO Joe Jobe. "The new report deflates the hot air behind the tired food vs. fuel debate and reinforces that biodiesel provides a renewable alternative to petroleum without negatively impacting food markets."

 
 The NBB release attracted many regional and industry press stories, as well as follow-up interviews on the report results.

Food vs. fuel debate deflates

French automaker Peugeot introduced a diesel-electric version of its 3008 series crossover Hybrid4 model. The car is outfitted with a 163 brake horsepower 2.0-liter 4-cylinder engine that powers the front wheels and an electric motor powered by nickel-metal hydride batteries that mobilize the rear axle, with a total system output of 200 horsepower and 500 Newton meters of torque. The car also features four-wheel drive capabilities along with regenerative braking. A turbocharged clean diesel engine is connected to an electronically-controlled six-speed transmission that can be operated in manual or full automatic mode. Shifting is done either by a console shifter or steering wheel paddles. The car can operate in three driving modes: electric-only, diesel only or a combination of both. The diesel hybrid achieves 69 miles per gallon and can go zero to 60 mph in 8.8 seconds. The car will hit the European market by spring 2011.
 
 Sun Power Biodiesel LLC will be the recipient of more than $1 million in financial assistance for equipment and infrastructure upgrades at its 3 MMgy plant in Cumberland, Wis. The funding package includes $800,000 in American Recovery and Reinvestment Act money provided to Sun Power Biodiesel through Wisconsin's State Energy Program. The state is also awarding a $349,825 Community Development Block Grant-Public Facilities for Economic Development grant to the city of Cumberland aimed to help pay for infrastructure investments including water mains, sanitary sewer, storm sewer, street construction, electric installation and lighting. The funds will be a boon for Sun Power Biodiesel as it will also provide additional working capital to sustain operations. According to CEO Ron Ruppel, the funding for the Sun Power Biodiesel project is in the form of a seven-year low-interest loan, which is expected to create 31 jobs over five years of the loan, and retain four. 
 
 California-based Biodiesel Industries Inc. has been selected by the California Energy Commission to receive an $886,815 grant to support a multi-year project that will demonstrate biodiesel production using algae in an integrated energy system monitored by the Automated Real-time, Remote, Integrated Energy System (ARIES) platform. The grant was awarded under the state's Alternative and Renewable Fuel and Vehicle Technology Program. Construction on the project is currently expected to begin in late September, and will take an estimated 29 months to complete. According to Russell Teall, Biodiesel Industries president and founder, the funding will be used to install additional equipment and infrastructure at the site, including greenhouses, ponds, containment vessels and testing equipment. 
 
 A team of researchers from Rutgers University and Harvard University is working with a well-known microorganism to aid in the production of biodiesel. The research, based on the E. coli microorganism, commonly associated with food poisoning, is being led by Desmond Lun, associate professor of computer science at Rutgers. Lun and his team are working to modify the genetic make-up of the E. coli organism, creating a strain of the bacteria that overproduces fatty acids which can then be used in biodiesel production. "Biodiesel is something that we can generate quite easily," Lun said. While E. coli is highly studied and understood, Lun noted that the work on the organism for biodiesel use will be "quite drastic" and require "major intervention." Instead of performing minor changes to specific genes he said, the work will modify large sections of the genome and put in "entirely new traits rather than modifying existing traits." 
 
 The USDA has issued an amendment for advanced biofuel producer requirements necessary for the Advanced Biofuel Payment Program, now allowing both nonrural and foreign-owned producers to qualify for the program. In March, the USDA issued a notice seeking requests for eligible advanced biofuel producers, but at that time, according to the USDA, "to receive payment, eligible advanced biofuels must have been produced in a biofuel facility located in a rural area and whose owners met U.S. citizenship requirements." After receiving several comments questioning the eligibility requirements, the USDA issued the change. One of the groups contesting the initial requirements was the Indiana Soybean Alliance, speaking in particular for the large Indiana refinery owned by Louis Dreyfus, Claypool LD Biodiesel and Soybean Processing Plant. 
 
 American Electric Power Co. Inc. announced Aug. 26 that it is seeking quotes for the supply of biodiesel to one or more of its coal-fired power plants in Ohio. Quotes were to be received by Sept. 23. According to AEP spokeswoman Melissa McHenry, the company is investigating the use of biodiesel-blended fuel oil as a possible compliance strategy to meet Ohio's alternative energy requirements. The biodiesel blend would replace petroleum fuel oil used for flame startup and stabilization. AEP is interested in using three different blends of biodiesel at is facilities. According to McHenry, B99.9 can be used from April 15 to Oct. 14. A blend of B50 can be used in the facilities from Oct. 15 through Dec. 14, while a B30 blend can be used from Dec. 15 to April 14. 
 
 Industrial biotechnology company Solazyme Inc. announced that Bunge Limited, a leading global agribusiness and food company, has joined its Series D round as a strategic investor. The strategic investment represents a foundational step for the two companies to collaborate at critical portions of a new value chain enabled by Solazyme's sugar-to-oil technology platform. Bunge is one of the world's largest originators and distributors of vegetable oils and one of the largest sugarcane processing companies in Brazil. Braemer Energy Ventures and Morgan Stanley led Solazyme's Series D round, with all major existing investors from previous rounds participating, including Lightspeed Venture Partners, The Roda Group, Harris and Harris Group, VantagePoint Venture Partners and Zygote Ventures. Existing strategic investors CTTV Investments LLC, the venture capital arm of Chevron Technology Ventures LLC, and San-Ei Gen, a major Japanese manufacturer and distributor of food ingredients, also participated.
 
 Alternative Petroleum Technologies has developed an emulsified biodiesel fuel-a proprietary blend of water, a surfactant additive and biodiesel-that eliminates the increased emissions of nitrogen oxides often associated with biodiesel use, the company said. This technology has been used in both on-road and off-road diesel engines to prove the NOx mitigation benefit of emulsified biodiesel blends relative to conventional biodiesel. APT chose biodiesel produced by Community Fuels in a demonstration of the technology at the Port of Los Angeles. The APT emulsified biodiesel fuel has reduced NOx emissions over a wide range of biodiesel blend levels. For B20, NOx emissions were 4.9 percent lower compared to conventional biodiesel and only 0.6 percent higher compared to ULSD.
 

 Ft. Collins, Colo.-based New Belgium Brewing cycled through the Midwest portion of its renowned 13-city, national bicycle festival dubbed the Tour de Fat-aptly named after the brewery's signature Fat Tire beer-and welcomed a generous supply of B100 supplied by Ames, Iowa-based producer Renewable Energy Group Inc. at events hosted in Chicago, Minneapolis and Milwaukee. REG provided B100 made from corn oil at its 30 MMgy facility in Newton, Iowa, to Fort Dodge, Iowa-based Decker Truck Lines LLC, which served as the event hauler for the Midwest portion of the Tour de Fat.

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Business Briefs

Many alternative transportation fuels such as electricity and compressed natural gas are likely to require huge infrastructure developments to reach commercial deployment, but the infrastructure requirements of biodiesel, however, are relatively minor. Even so, investment in proper infrastructure and equipment upgrades at fuel terminals can have overwhelmingly positive impacts on the industry. "It helps decrease costs, increases quality, maintains quality, and makes it more available to bigger parts of the market," says Tom Verry, the National Biodiesel Board's director of outreach and development. To date, a majority of biodiesel infrastructure has been centered in regions where state or local governments have established mandates. "As the market develops, infrastructure will develop to support it," Verry says. "Right now it is really being driven by markets, which, in turn, are being driven by state incentives."
 
 This pattern of development occurred in Washington State after its mandate was established. "Now, with Pennsylvania developing its mandate, we'll probably see more biodiesel blending at the terminal there, which is wonderful," Verry says, noting that terminals offering biodiesel can handle large volumes of the fuel, reducing costs.
 
 Biodiesel infrastructure can also lead to fuel quality benefits. If biodiesel is blended at the rack with a computerized system, Verry says, it helps maintain fuel quality. In addition, offering the fuel becomes more convenient for trucking companies. When biodiesel is not offered at the rack, fuel distributors that want to offer it have to splash blend it themselves and maintain their own storage equipment. "It takes a significant effort on a fuel distributor's part to carry biodiesel" when it is not offered at the terminal, Verry says. "If it's at the terminal, it's just as easy to get as any other product pulled from that terminal. It just makes it a lot easier for distributors to make the decision whether they want to offer biodiesel to their customers."
 
 
 Federal Funding
 
 While rack blending of biodiesel offers significant benefits to fuel distributors and potential consumers, increased prices-largely a result of the $1 per gallon federal tax credit expiration-have depressed market demand for the fuel. Although reinstatement of the credit or higher renewable identification number (RIN) credit prices would likely bring prices back down, thereby increasing demand, many terminal operators have a difficult time justifying the cost of adding biodiesel infrastructure in the current market environment. State and federal incentives are helping terminals overcome this obstacle, however.
 
 One federal program that can help support biodiesel infrastructure development is the U.S. DOE's Clean Cities program. According the Verry, biodiesel terminal infrastructure is eligible for funding under the Clean Cities Petroleum Reduction Grant program. "In the past, the program has funded biodiesel terminal infrastructure," he says, noting more than half a dozen terminals have received grants for this purpose. 
 
 Verry says the NBB worked with DOE to make sure biodiesel would qualify for these programs. When the program was formed five years ago, biodiesel was a relatively new fuel and the DOE wasn't yet familiar with its infrastructure requirements. "We worked to educate them that, yes, biodiesel could be a very important way to help meet their goals of petroleum displacement." 
 
 According to Verry, the DOE is expected to solicit applications for a new funding round late this year or early 2011. "They are going to have $15 million available to support alternative fuel infrastructure, and biodiesel qualifies for that," he says. "They will support a biodiesel terminal project, but they want to see that matched up with a very strong B20 marketing program that is directed at the retail level." The department also wants to see the applicant form a strong relationship with the Clean Cities coordinator in their region, as well as see a strong match on the proposal from an industry partner. "Of course," Verry says, "the more gallons of petroleum you displace, the better your proposal will look."

 
 
 California Development
 
 While the DOE's Clean Cities program offers funding nationwide, several state programs are also available to assist in the development of biodiesel infrastructure. California is one state that has been active in this area. The California Energy Commission recently recommended that three biodiesel terminal projects receive grant funding under its Alternative and Renewable Fuel and Vehicle Technology Program. Although the awards are contingent upon a final approval vote during an energy commission business meeting, the planned recipients are prepared to begin construction soon after the grants are awarded. 
 
 According to a Notice of Proposed Awards issued by the CEC, three companies-Community Fuels, Pearson Fuels Inc. and Western States Oil Co.-have been selected to receive a combined $3.9 million in funding. Nearly $2 million awarded to Community Fuels will support a terminal development project adjacent to the company's 10 MMgy biodiesel plant in the Port of Stockton. An additional $1.8 million is slated to go to Pearson Fuels for the development of biodiesel infrastructure at two existing fuel terminals within the state-one near Sacramento, the other near San Diego. A smaller award of approximately $70,000 will be awarded to Western States Oil for the development of a biodiesel terminal located just outside the gate of Kinder Morgan's pipeline terminal in San Jose. 
 
 Pearson Fuels plans to add three 80,000-gallon biodiesel storage tanks to the Sacramento terminal. "We are actually going to have two different feedstocks of biodiesel, likely soy and waste cooking oil," says Mike Lewis, Pearson Fuels' general manager. In addition to inline blending of diesel and biodiesel, the facility will also include inline blending of red dye diesel. "So, you have literally hundreds of different combinations that will be available," he continues. The terminal near San Diego will have a similar set-up, but will be slightly smaller and only offer one feedstock of biodiesel. 
 
 The terminal Community Fuels intends to construct will have five main components, says Lisa Mortenson, the company's CEO and founder. This includes 500,000 gallons of new biodiesel storage, product purification equipment, enhanced truck and railcar loading capabilities, red dye capabilities and a full quality assurance program. "With storage, special attention has been paid to proper storage techniques to ensure that there is no fuel degradation," Mortenson says. Since the terminal will offer biodiesel produced by Community Fuels as well as biodiesel produced by third parties, quality analysis and purification capabilities will be a part of the facility. Fuel supplied by other parties will be subject to a thorough quality analysis, Mortenson says. A product purification step will also be included to ensure that any contamination that occurred during transit is properly remedied. 
 
 
 Benefits and Market Potential
 

 Offering biodiesel at, or near, an existing fuel terminal significantly increases convenience while reducing costs. According to Bob Brown, Western State Oil's special project manager, the company's new location will better serve the regional market. The company currently offers biodiesel at another location in San Jose, he says, but that location is far from the Kinder Morgan terminal. "Anybody needing biodiesel basically has to come here first, and then drive all the way over to the pipeline to get their diesel, and then go make their deliveries," Brown says. "We're just going to make biodiesel available right outside the gate of that terminal," making it less costly and more convenient for fuel marketers to supply to their customers. 
 
 Lewis notes that Pearson Fuels' terminals will lead to similar market benefits. Inline blending capabilities will save money and time because trucking companies will no longer have to go to two fuel racks to supply biodiesel blends, he says. The inline blending capabilities of the new infrastructure will also allow more complete blending of the two fuels. 
 
 "There is very little biodiesel infrastructure in California-period," Lewis says. "There are very, very few retail facilities, and there are very few places you can go to get blended biodiesel, or different mixtures of the fuel. We think that is a critical piece that has been missing out of the biodiesel infrastructure in California. When you cripple a product by having to go to two different places, where trucks have to wait in two different lines, you have hindered biodiesel right away in competing with diesel." The extra transportation and time costs can easily price the fuel out of the retail market. 
 
 Unlike many other states, California does not have a biodiesel-specific mandate. Rather, the state is developing a Low Carbon Fuel Standard, which requires regulated parties to reduce the overall carbon value of their fuels, but does not mandate use of a specific alternative fuel. While biodiesel can, and likely will, play a role in achieving the requirements of the LCFS, Mortenson notes that maintaining the fuel's quality will be necessary for this to occur. "Biodiesel has special handling, storage and end-use requirements," she says. "In order for biodiesel to have a substantial role under the LCFS, special attention is needed to ensure the fuel meets appropriate quality standards. Increasing the volume of biodiesel supplied to the California market is an important first step, but we do believe an equally important step is ensuring biodiesel fuel quality will be reliable."
 
 Although the expiration of the biodiesel tax credit has decreased short-term demand for biodiesel, reinstatement of the incentive, higher RIN prices and enforcement of the second stage of the renewable fuels standard (RFS2) are all expected to increase demand in the long term. "The RFS2 is now being implemented, and we expect it to be a market driver in 2011, leading to more terminals offering biodiesel service," Verry says. "The home heating oil industry is also planning to start using more biodiesel, especially in the Northeast and mid-Atlantic. We expect to see more terminals develop in those regions to support Bioheat demand."
 Brown says that biodiesel demand in his region was up significantly until the first of the year. The expiration of the biodiesel tax credit and California's regulations for underground storage tanks have negated most of that market growth. "When the blending credit went away, it started to turn right around and come back down," he says. "Now it's kind of leveled off. The cities and counties are still using it, a few utilities are still using it, as are biodiesel enthusiasts, but those two developments have really made it tough. Biodiesel usage is starting to go back up, but it's real slow. One of the reasons we are developing this terminal now is we believe biodiesel is a growth product, and we are going to see more of it. We're not afraid to invest in it."
 
 The petroleum industry has been developing infrastructure for more than 100 years, Lewis says, while alternative fuels like biodiesel have only been commercially available for a decade. "The things that you take for granted with petroleum fuel, you can't necessarily take for granted with biodiesel-like how do you blend it?" he says. "To someone just entering the industry, it might not seem like a big deal. Well, it is a big deal. It's one of the missing links, so to speak. Kudos to the state of California for jump-starting some of these sorts of things, because eventually you'll get to the point where these biofuels can complete on an even footing with some of the petroleum-based fuels that have had a 90-year head start."
 
 Erin Voegele is a Biodiesel Magazine associate editor. Reach her at (701) 850-2551 or <a href="mailto:evoegele@bbiinternational.com">evoegele@bbiinternational.com</a>.

A Community Fuels employee works in the quality assurance laboratory. Quality certification of all fuel carried and sold is a fundamental component of the company's new terminal project. PHOTO: COMMUNITY FUELS

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Development of dedicated biodiesel infrastructure can lower costs while increasing fuel quality and market opportunities.

Infrastructure to Market

Biodiesel has emerged as a major global commodity. As international production capacity and markets continue to fluctuate, many countries will be looking to fulfill demand from developing markets beyond meeting the needs of their own. Ideally, fundamental biodiesel trade practices would benefit all parties involved, lowering trade deficits, bringing about fuel security, lowering greenhouse gas emissions and reducing dependency on foreign oil. When practices don't conform to these fundamental principles, they can carry long-term consequences, as seen in the case of the controversial "splash-and-dash" loophole that has festered since 2006, creating trade friction in Europe and consternation in the U.S. The World Trade Organization has set strict trade guidelines, yet complaints of unfair trade continue to mount. 

 
 Today, biodiesel economics are even more constrained. Not only is it felt in the U.S. under an absent tax incentive, but global demand for biodiesel is expected to increase exponentially to 7.8 billion gallons by 2015, according to the U.S. DOE's Energy Information Administration. This spike in demand means more consumption, and more consumption translates into increased traffic of shipments making its way across the world to meet that demand. 
 
 But trade differences seem to be widening, so if biodiesel is to flourish as a globally traded commodity that will ultimately benefit all parties involved and grow as an alternative to petroleum, action to settle these disputes must be taken. 
 
 
 The Usual Suspects
 
 Despite the closing of the U.S. splash-and-dash loophole in the Emergency Economic Stabilization Act of 2008, the European Union remained committed to keeping a watchful eye on biodiesel shipments entering its ports. In August, the EU's legislative arm, the European Commission, launched an anti-circumvention investigation into imports of U.S.-based biodiesel to Europe to determine whether previously imposed anti-dumping measures are being circumvented. 
 
 The European Biodiesel Board alleges that, ever since the EC imposed anti-dumping and anti-subsidy duties against U.S. biodiesel in June 2008, which extend five years out, disreputable trading schemes have emerged. The EBB claims that U.S.-based biodiesel is being shipped to the EU through other countries, mainly Canada and Singapore, in order to conceal its origin. The EBB also asserts that substantial volumes of U.S.-produced biodiesel continue to flood European ports in the form of blends-typically B19-not covered by the EU duties, practices that "are a mere attempt to evade the anti-dumping and countervailing duties," the EBB said in a statement. 
 
 Specifically, the EC is investigating whether U.S. producers exporting B20 or higher blends to European ports are honoring imposed duties, as not all U.S. producers are intentionally circumventing the tariffs. B19 blends are not covered by last year's tariffs, according to the EBB, whose members produce 80 percent of the continent's biodiesel.
 
 The National Biodiesel Board, representing U.S. producers, denies the claims made by the EBB and states that it intends to painstakingly confront the issue appropriately in defense of its members. "The NBB is disappointed that the EBB has opted to pursue this frivolous complaint, especially in light of the larger shared challenges that confront both the American and European biodiesel industries," says Manning Feraci, vice president of federal affairs for the NBB. "The NBB will actively defend the interests of the U.S. biodiesel industry in this proceeding and will work with the U.S. government and others to ensure that the anti-dumping and countervailing duties currently applied to biodiesel produced in the U.S. are not expanded beyond their proper scope."

 
 In addition to the NBB, the Office of the United States Trade Representative issued a similar rebuttal. "We are disappointed that the EU initiated this investigation," says spokesman Nefeterius Akeli McPherson. "Based on the evidence contained in the European industry's request, it does not appear that a circumvention investigation is warranted." According to McPherson, questionnaires have been issued to interested parties, which were due 37 days from the date of initiation, and that the investigation will likely conclude in approximately nine months from its start.
 
 The anti-circumvention action launched by the EC is backed by a parallel investigation by the EU Anti-Fraud Office (OLAF) "in order to put an end to these unacceptable trade practices which may represent more than €100 million ($129 million) of unpaid import duties," according to the EBB. In the event that "fraudulent" practices persist, unpaid duties would be collected by EU authorities retroactive three years, carrying with them heavy penalties. 
 
 In March, the EBB reported that Italian customs authorities seized 10,000 metric tons (approximately 3 million gallons) of biodiesel at the ports of Venice and Trieste. The product was declared as Canadian origin, but the EBB stated at that time that "strong evidences" signaled that it instead originated from the U.S. The product was namely offered at a discount of $150 to $180 per ton (50 to 60 cents per gallon) compared to EU biodiesel of comparable quality, and sold at a discounted price to soybean oil and rapeseed oil. 
 
 "We certainly don't believe [the seizure] is indicative of a much broader concern around circumvention," says Gordon Quaiattini, president of the Canadian Renewable Fuels Association. "We don't support any kind of practice that would result in somehow circumventing the European-imposed tariff on U.S.-based biodiesel."
 
 Canadian biodiesel exports to the EU have increased to more than 140,000 tons (42 million gallons) in 2009 from approximately 1,700 tons in 2008, according to Europe's statistics database, Eurostat. The EC's anti-circumvention investigation could be perceived as a protectionist-oriented approach, Quaiattini explains, as much of the biodiesel being imported from the U.S. is attributed to the North America Free Trade Agreement as a vehicle for meeting Canada's domestic biodiesel volume targets. 
 
 "I think the Europeans are looking at volumes going from the U.S. into Canada and believe it's purely a circumvention play to have that fuel make its way into Europe, and the reality is that just isn't happening," Quaiattini says. "U.S. biodiesel is staying in the Canadian market in order to meet mandates here. That's been the result of the increase in volume coming in."
 With one eye on U.S. imports, the EU is also concerned by the sharp increase in biodiesel exports from Argentina to Europe, which increased dramatically from approximately 5,000 tons in July 2008 to almost 100,000 tons per month in July 2009. The EBB states that Spain's biodiesel industry particularly has been hit hard by Argentine imports. 
 
 Argentina, a net exporter of biodiesel, applies a differential export tax on biodiesel made from soybean oil. The differential between the 32 percent export tax on soybean oil and the 20 percent export tax on biodiesel creates a financial incentive to process soybean oil into biodiesel rather than exporting it. Argentina's trade benefits are in effect until the end of 2011, but they may be challenged early by the EU if there is an indication that Argentina is colluding with the U.S. in selling U.S.-based biodiesel to Europe as its own. Consequently, Argentine biodiesel is expected to remain a strong competitor to European-made methyl esters in the EU. 
 
 

 Australia Takes a Stand
 
 In June, Australia's Customs and Border Protection Service launched concurrent dumping and countervailing duty investigations into U.S. biodiesel imports, specifically B99 and biodiesel blends above 20 percent, from April 2009 through March 2010. The investigation came in light of a complaint lodged by Australian company Biodiesel Producers Ltd. to local customs authorities after it noticed increased volumes of U.S.-based biodiesel being sold at a discount to Australian biodiesel on the Australian market, allegedly causing several producers to lose their share of the market. According to the Biofuels Association of Australia, the country currently houses seven biodiesel plants, four of which are operating at a combined rate of 115 MMly mainly from tallow and used cooking oil. 
 
 "We are also receiving product that has lower cetane levels than that of the Australian biodiesel standard," says BAA CEO Heather Brodie. "Thus, the imported product is arriving in Australia at lower prices than we can even buy our feedstocks for."
 
 Rather than a subsidization scheme found in the U.S., Australia employs a complex grant system to incentivize production of biodiesel. The incentive, referred to as the Cleaner-Fuels Grant, is a tax break for producers worth approximately 35 cents per liter. "So the tax outcome to the consumer is neutral," Brodie says. "This changes as of July 1 next year."
 
 Brodie adds that customs officials are investigating the complaint, and if the claims are found legitimate, then any involved parties partaking in the practice would be forced to cease shipments and penalties in the form of fines would be attached. 
 
 "The BAA understands that action taken by Customs and Border Protection can be extensive in its support," Brodie says. "Indeed, if there is a positive finding for countervailing subsidies, there is a risk that subsidized biodiesel imported between June 22 and the date of the finding may also be subject to the countervailing action. We will certainly be supporting this to ensure that the Australian industry receives an affirmative determination."
 
 U.S. biodiesel exports to Australia have been infrequent this year and not a key market for U.S. suppliers. A report produced by the USDA's Foreign Agricultural Service in July pegged U.S. biodiesel exports to Australia at less than 1 percent of total U.S. exports, making Australia a very small market for the U.S. by global standards.
 
 However, Brodie insists that the investigation would serve as a warning to importers to either end the dumping of cheap U.S. biodiesel or face possible duties, one that could mirror Europe's anti-dumping measures on to U.S.-produced biodiesel. "It's absolutely imperative for the success of the Australian biofuels industry that these practices cease, and cease immediately," Brodie says. "There is no way that the local industry can then compete on a level playing field and Australian taxpayer's dollars are actually, in effect, supporting the U.S. industry." 

 
 Bryan Sims is a Biodiesel Magazine associate editor. Reach him at (701) 738-4974 or <a href="mailto:bsims@bbiinternational.com">bsims@bbiinternational.com</a>

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Imports of pure biodiesel to the EU have been climbing, and the EBB claims U.S. producers are using third-party countries to circumvent tariffs. Source: USDA FAS

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Europe furthers its investigation into U.S., and more recently, Argentine biodiesel imports while Australia follows suit.

October 2010

Business Briefs

Business Briefs: People, Products & Partnerships

Business Briefs

Columns

Zeroing in on Power and Thermal

ENERGY REVIEW: Reducing Water Usage in Biopower Production

LEGAL PERSPECTIVES: New Possibilities in the Hunt for Biomass Project Financing

POWER PLATFORM: Biomass Industry Pushes Back Against Potentially Harmful Laws

Meet You in Atlanta

RFS2 Compliance for Obligated Parties

Featured

Supply Supply Supply

Zero Tolerance for Waste

Cogeneration Sensation

Infrastructure to Market

Balancing Act

Waste Oil's New World

Contributions

Onion Processor Uses AD, Fuel Cells To Convert Waste Into Energy

Energy Master Plans Streamline Operational Efficiency, Reduce Costs

October 2010.css-7jxktu{position:absolute;bottom:0px;left:0px;right:0px;height:3px;border-radius:3px;background-color:var(--chakra-colors-brandBlack);}

Business Briefs

Business Briefs: People, Products & Partnerships

Business Briefs

Columns

Zeroing in on Power and Thermal

ENERGY REVIEW: Reducing Water Usage in Biopower Production

LEGAL PERSPECTIVES: New Possibilities in the Hunt for Biomass Project Financing

POWER PLATFORM: Biomass Industry Pushes Back Against Potentially Harmful Laws

Meet You in Atlanta

RFS2 Compliance for Obligated Parties

Featured

Supply Supply Supply

Zero Tolerance for Waste

Cogeneration Sensation

Infrastructure to Market

Balancing Act

Waste Oil's New World

Contributions

Onion Processor Uses AD, Fuel Cells To Convert Waste Into Energy

Energy Master Plans Streamline Operational Efficiency, Reduce Costs

October 2010