Producers share cellulosic biofuel progress, RFS challenges
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WASHINGTON, Sept. 19, 2014 - Even with worries about stability and predictability in the Renewable Fuel Standard (RFS) rule, several biofuel companies banded together this week to share the news of the steps they've taken to make cellulosic biofuel a reality in the U.S. and Brazil.
In a teleconference, four industry leaders talked about their advances in the field and concerns about the RFS.
Earlier this month, POET-DSM Advanced Biofuels opened the first commercial cellulosic ethanol plant in the nation, Project LIBERTY near Emmetsburg, Iowa. Steve Hartig, general manager of licensing for Poet-DSM, calls this an “exciting time in the cellulosic biofuels industry.”
Abengoa Bioenergy's Hugoton, Kansas plant is due to open October 17, and GranBio is developing a plant in Brazil.
Yet, uncertainty about the final rule for the 2014 RFS has “significantly chilled investment in the future” of the industry, which is needed for continued progress, says Brent Erickson, executive vice president of the biotechnology trade association BIO.
“We are asking the Obama administration to finalize this year's rule and keep it on course for the future,” Erickson says, ‘by setting the annual standards according to our industry's ability to produce biofuel, not the oil refining industry's willingness to make room in the market for us.”
Erickson points at the hundreds of new jobs and economic opportunities generated in rural communities where the plants are located, but stresses that further expansion and additional construction will require billions more in investment - funds not readily invested due to the uncertainty of the proposed rule.
The big question, Erickson says, is “What is the size of the market for the end product?”
If predictions from the U.S. Energy Information Administration (EIA) are any indicator, the market may be growing. On Sept. 10, the EIA announced its forecast of gasoline use increased by 2 billion gallons in the past 10 months.
Christopher Standlee, executive vice president for global affairs for Abengoa, says its soon-to-open Kansas biorefinery will purchase 300,000 tons of agricultural residues annually from local farmers at a cost of $17 million. The self-sufficient facility will convert the biomass to 25 million gallons of cellulosic ethanol and 21 megawatts of renewable electric power each year, producing all of its own steam and electricity needs and additional electricity to sell to the local power grid.
Abengoa is working on plans to turn municipal solid waste from urban landfills into low-cost, high octane fuel at other locations. It is also preparing to develop a cellulosic hybrid project near its existing sugar facility in Brazil.
Brazilian company GranBio is commissioning a 2 million gallon cellulosic plant in Brazil that will use sugar cane straw. Vonnie Estes, GranBio's U.S. managing director, says the company plans to export at least of half of the low-carbon fuel from the plant to the States and plans to use U.S. products, including enzymes, in production.
Yet, for GranBio, too, concerns about the RFS play into the decision-making for the future.
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