Biomass harvest in full swing in Emmetsburg

The 2011 biomass harvest is underway around Emmetsburg, Iowa.

Farmers there baled 56,000 tons of corn cobs, leaves, husk and some stalk last season, and this year they’ll bring even more into POET’s 22-acre stack yard at the site of Project LIBERTY. I thought I’d share some pictures from the harvest. Check them all out on our Flickr page.

Cellulosic ethanol report reinforces the value of research, partnerships in commercialization

Yesterday’s report from the National Research Council on cellulosic ethanol production devotes about 100 pages to the environmental effects of cellulosic ethanol.

To sum up the findings: There are right and wrong ways to produce cellulosic ethanol, and the environmental benefits depend on which path you choose.

This is not a revelation. POET has always endorsed a cautious approach to commercialization. It’s amusing that we get questions one day asking “Are you moving too quickly to understand the environmental effects?” and the next “Why is cellulosic ethanol taking so long to commercialize?”

POET’s Project LIBERTY will use corn cobs, leaves, husk, and stalk to produce cellulosic ethanol, so I paid more attention to those sections dealing with POET’s process. One such section asserts:

“Corn stover, cereal straw, and other crop residues draw on existing crops so that their use as a bioenergy feedstock under best management practices might not contribute much additional GHG emissions. However, overharvesting of crop residues could result in additional need for agrichemical inputs and the loss of soil organic matter, which is critical for maintaining soil structure and water retention capacity and for improving nutrient cycling and other soil processes.”

POET agrees completely. This material is not “crop waste,” as some would assert. Stover plays a valuable role in soil health, and that’s something that POET is carefully monitoring through work with USDA-ARS and Iowa State University. This fall marks the fourth year of an ongoing study into effects of stover harvesting on soil in the Emmetsburg, Iowa area. This is information we share with the public. Download the latest results here.

POET contracts with farmers for no more than 20-25 percent of the above-ground biomass, which is on the low end of what that data shows is available for use. There are a few ways to ensure this limit is followed:

- Farmers want to protect their livelihood, the grain harvest, so they don’t want to take too much.

- POET representatives visit the fields of participating farmers during the harvest to make sure things are going as planned.

- To take more biomass, the harvest equipment is set lower to the ground, picking up extra dirt, rocks, and other debris. This additional material would cause the biomass to be outside of POET’s quality standards.

The pace moving from lab scale to pilot scale to commercial construction has been steady, with many checkpoints along the way. No one’s rushing into this without assessing the impacts.

A couple other points I want to address from the study:

1. Economics: There’s been a big to-do about the study’s conclusion that there’s a significant “price gap” between what companies will pay for biomass and what farmers will accept in order to harvest it.

We don’t go into specifics on our arrangements with farmers, because the biomass market is still developing. I will say this: Their assumptions are not consistent with the actual first-hand experience of POET signing contracts and working with farmers.

2. The report asserts that corn stover will be an early feedstock and that if done properly, it is positive for the environment. It then notes that the entire 16 billion gallons in the Renewable Fuel Standard can’t be met with stover alone.

Maybe I missed it, but it seems to me that the report doesn’t make clear just how much of that 16 billion gallons could come from crop residue. I think that’s an important point to note.

POET’s model has a cellulosic ethanol plant sited next to a grain-based ethanol plant. The cellulosic ethanol plant is half the size of the adjacent facility.

That means POET’s model, if applied across the industry could do roughly 6 or 7 billion gallons of the 16 billion gallons. That’s pretty significant, and from some of the reports I’ve seen, that number is on the low end of the potential.

Common ground in the National Research Council’s cellulosic ethanol report

You’ve likely heard rebuttals to today’s National Research Council report questioning the viability of large-scale cellulosic ethanol production, the most prevalent being that it relies on an enormous number of assumptions. The text itself asserts “… with all the expertise available to us, our clearest conclusion is that there is very high uncertainty in the impacts we were trying to estimate.”

However, there are points with which most in the cellulosic ethanol industry agree. These issues outline a path toward creating a viable and sustainable cellulosic ethanol industry.

I haven’t gotten through all 650 pages of the report yet, but a couple points stand out so far:

1. Inconsistent public policy is a barrier to the cellulosic ethanol industry.

This is a point that the ethanol industry has long maintained, and the report confirmed it, noting the 2008 request by Texas Gov. Rick Perry to waive the Renewable Fuel Standard.

“EPA denied that request, but economic dislocation
waivers are still possible. Undoubtedly, uncertainty of enforcement of the [Renewable Fuel Standard] is an impediment for private-sector investment.”

It goes on to point out the cellulosic ethanol tax credit is set to expire in 2012 and the Biomass Crop Assistance Program’s future is uncertain.

Producers and investors must know the lay of the land before they can move forward in this effort. If policies keep changing, there’s no confidence that what’s true today will be true tomorrow. The same is true for farmers looking to invest in the machinery to harvest biomass.

POET CEO Jeff Broin made this same point to the Senate Committee on Agriculture, Nutrition, and Forestry at a March 30 hearing.

"Investors look at the long-term prospects of a project before getting involved, and uncertainty from Washington adds an element of risk to those projects," he said.

2. Lack of fueling infrastructure limits ethanol’s ability to enter the fuel supply at higher blend levels.

This has been an ethanol industry point for years: We have hit the “blend wall,” the point at which we’re blending all the ethanol at E10 that can legally be used in today’s vehicles. E15 buys the industry time to build out infrastructure, but as the report asserts:

“… even with a blend limit of 15 percent, the blend wall will be reached again around 2014. Thus, the blend wall is a major barrier for increasing ethanol production beyond about 19 billion gallons even if the blend limit is 15 percent.”

To proceed, we need a large effort to produce more Flex Fuel Vehicles and more Flex Pumps, which can dispense different ethanol blends such as E10, E30, E50, or E85. If the consumer can choose any blend, the oil industry will lose its strangle-hold on the economy.

“It would require large and rapid investments in fuel dispensers for E85 plus millions of flex-fuel vehicles produced and sold each year.”

There are about 8 million Flex Fuel vehicles on the road today, and both GM and Ford have committed to making half the new cars they sell in 2012 Flex Fuel. These efforts as well as efforts to get more Flex Pumps in stations across the U.S. must increase. The longer we wait, the longer it will take to break our reliance on oil.

These points and others are not a reason to stop cellulosic ethanol commercialization efforts. Rather, they clarify work that still needs to get done and stress the importance of work that is getting done to address these needs.

I’m working on another post addressing POET’s process for cellulosic ethanol in the context of this report. Look for that tomorrow and maybe more depending on how much of this I can get through.