2011 Harvest in the Books

The 2011 harvest has been completed and saw farrmers around Emmetsburg, Iowa collect 61,000 bone-dry tons of corn cobs and high cut material. POET Regional Biomass Coordinator Adam Wirt was in Fort Dodge, Iowa yesterday for the Farm News Ag Show to update local farmers on our progress.

As you can see from this harvest photo taken near Emmetsburg, there is still plenty of cover on the field after the crop residue is baled. The amount of stover in those fields ensures that the harvest of crop residue can be sustainable.

Once BCAP is straightened out, these bales will be delivered to the stack yard in Emmetsburg and many will end up in South Dakota where they will be converted to cellulosic ethanol in our pilot plant or power for POET Biorefining - Chancellor. Another harvest brings us that much closer to our goal of producing cellulosic ethanol at the commercial scale.

POET CEO on Cellulosic Progress

During Trade Talk at the annual convention of the National Association of Farm Broadcasters (NAFB), POET Founder & CEO Jeff Broin talked with several farm broadcasters. He's pictured here in one of those many interviews.

One of those interviews was with Jody Heemstra of KWAT Radio in Watertown, S.D. Domestic Fuel got a copy of the seven minute interview and posted it on their blog.

Broin talked about the recently completed corn corn crop residue harvest said that POET has made "tremendous strides" developing commercial cellulosic ethanol. He also talked about how POET will integrate cellulosic ethanol production with its existing corn ethanol plants and the benefits that will bring to both processes.

In-Line with LIBERTY: Wisconsin's Report on Sustainable Biomass

When it comes to biofuels, there are three things in which I believe: First, biomass for biofuels has enormous potential as a primary piece of our nation’s energy program. Second, corn crop residue is one of the best types of biomass for biofuel production—it’s available in large quantities. And thirdly, corn crop residue can be—and must be—harvested in environmentally sustainable ways.

So, I was gratified to learn that officials in the State of Wisconsin share my beliefs. The Wisconsin Department of Natural Resources, the University of Wisconsin, and their partners recently published the Wisconsin Sustainable Planting and Harvesting Guidelines for Nonforest Biomass.

The report, which details voluntary guidelines for sustainable biomass planting and harvesting, states that corn stover makes up more than half of all crop residues in the US and is considered the most available for bioenergy purposes.

Based on current scientific knowledge vetted through scientific review and public comments, the report says, “without specific field-based assessment (e.g. a conservation plan), remove only 25% of stover to maintain soil organic carbon levels and structural stability.” Depending on soil type, even more corn crop reside can be removed while maintaining good soil conditions.

This is great news! Farmers participating in POET Project LIBERTY are right in step, harvesting about 1 bone dry ton of corn crop residue per acre, which is about 25% of the available stover per acre in the Emmetsburg, Iowa area.

POET encourages participating farmers to practice good conservation planning and follow the guidelines of the USDA Natural Resources Conservation Service (NRCS). Again, Wisconsin is in alignment. Its report says that site-specific stubble height, residual cover and stover removal rates should be determined using soil conservation planning tools available from the USDA NRCS.

POET’s biomass harvest guidelines have been supported by multiple years of research conducted by Iowa State University. We now welcome Wisconsin’s support! My beliefs are solid.

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.

 

Conditional Commitment from DOE keeps cellulosic ethanol moving forward

This morning, the Department of Energy announced a conditional commitment for a loan guarantee for Project LIBERTY, POET's project to make cellulosic ethanol out of corn crop residue.

As we've said before (on this blog and elsewhere), the loan guarantee is an important step to commercialization of cellulosic ethanol. I like the way Brooke Coleman of the Advanced Ethanol Council put it: commercial cellulosic ethanol plants cost a couple hundred million dollars and it’s tough to get a car loan in this economy.

The story has generated a lot of coverage, including the New York Times and Wall Street Journal. There was also a comprehensive update from Ucilia Wang at earth2tech. If you're wondering where the project stands, watch this video interview with Project LIBERTY Director Jim Sturdevant:

For more on the announcement, see releases from POET and the DOE.

BCAP's Unspoken Benefits

With the future of the Biomass Crop Assistance Program (BCAP) up in the air due to federal budget discussions, I thought I'd point out the benefits we've seen thus far in our work on Project LIBERTY.

1) Producer Participation/Assistance/Incentive - The biggest impact that BCAP has provided is for producer incentive and assistance with getting started. The early adopters that we are working with have made a bold step in choosing to collect biomass. With no other commercial facility in the country to point to where biomass is being delivered, many farmers ask why they should do this and what their incentive is to do so. BCAP has offered financial backing to help assist producers in investing in new equipment and creating an incentive to be part of the next scope change to modern farming.

2) Rural Economic Boost - As producers have invested in new equipment and looked for additional help, the money they spend is going directly to rural communities. In Emmetsburg, people are starting up new businesses to serve the farmers in their new endeavor. In the tough economic conditions our country faces, this can make a big impact.

3) Project Growth/Stability - BCAP provides a project like ours the ability to role out a biomass collection program with more financial stability. The support funding helps limit a project's financial exposure and/or allows for project growth/expansion in the early years. In the case of LIBERTY, we have been able to spread to more farmers and actively work with them to show them how biomass collection will benefit them.

4) Environmental Re-focus - Part of the BCAP program is performing a Conservation Plan. Many of the items included in this plan are already being done by farmers today. This has provided an opportunity for the producers to re-look at how they manage their land and make sure they are performing the best practices to help them be both productive and sustainable.

5) Farm Operation Expansion/Diversity - By participating in biomass collection and BCAP, producers are expanding their operations and creating more diversity. In some instances, this has opened the door to allow another person into the operation that may not have had the opportunity or space to support them without such a program. Programs like this offer the chance for more of our farm youth to come back to the farm.

As one can see by the list above, BCAP is having many positive impacts to the producers enrolled in BCAP, the Biomass Conversion Facility supporting BCAP, and the community in which the project is being established. Further support of BCAP should continue as it will create a pathway to help establish Second-Generation Biofuels and Re-powering.

Going "Beyond the Kernel" at the International Biomass Conference

Scott Weishaar, VP of Commercial Development for POET, was at BBI International’s International Biomass Conference & Expo to talk on the panel: Beyond the Kernel: Stover Strategies for Biofuel Production. Weishaar gave an update on what POET Biomass has learned about the logistics of harvesting, transporting and storing corn cobs, leaves and husks for cellulosic ethanol production.

Here's his presentation:

Beyond the Kernel

View more presentations from POET

Ethanol Producer Magazine covered the event here. Check out our web site for more information on POET's work in cellulosic ethanol.

Tons of Biomass

As we have said in previous posts on this blog, it will take a lot of biomass to feed Project LIBERTY when it's up and running. It will need somewhere in the neighborhood of 300,000 tons to produce 25 million gallons of cellulosic ethanol each and every year.

This year was the first commercial harvest and it saw 85 farmers provide about 56,000 tons of baled corn cobs and light stover. They say a picture is worth a thousand words and this picture of 24,000 tons of biomass should give you a better iead of the volume we're talking about. That's less than half of the total that was collected.

According to a study from the U.S. Departments of Agriculture and Energy, there is more than one billion tons of biomass available in the U.S. Just imagine what that pile would look like.

LIBERTY Stackyard Up and Running

We had to wait a little longer than we wanted to, but the LIBERTY stackyard has now been up and running for nearly 5-weeks. Producers around Emmetsburg were able to get their Eligible Material Owner applications approved around January 24th and start deliveries. To date, we have brought in nearly 23,000 bone-dry tons (BDT) of material. We are averaging around 900 BDT of material into the yard everyday, which will allow us to meet our need production need of 770 BDT per day. Best of all, we hit the 770 BDT mark on the second day of taking bales. This was a huge accomplishment for the team, and they have not stopped since. Our guys in the stackyard have been doing a great job and deserve a much needed pat on the back. Great Job Guys!!!

Through these first weeks of delivery, we have experienced two of the bigger challenges we were waiting for. First was the opportunity to deal with snow in the yard. The team is learning how and where to move snow when it comes. They are attacking the areas where the most work will occur and balancing that with the unloading of trucks. We found that by slowing the inbound trucks, the snow gives the guys extra time to clean up the yeard.

The second was thawing and melting. With the seasonally high temps last week, much of the snow in the area melted causing muddy conditions. As well, the frost has begun coming out of the ground and both loaders and trucks were digging down into the roads and bale rows quite a bit. As we struggled with this, we also heard about the farmers struggling too. It looks like as we turn into spring of the spring of the year, we will be able to get by working in the mornings when the ground is firm, but may need to stop in the afternoons as the ground again turns soft. This is all part of the learning process!

 
 
Along with bale deliveries, we have performed our first round of sampling on the storage study bales that are in the stackyard. We will be doing analysis on these samples to determine the dry matter losses and compositional changes in the biomass that are occurring. We will perform more samplings throughout the year to see how these parameters change over time in the bales.

Project LIBERTY's economic impact

Last week, the Iowa Power Fund released an economic impact study looking at the 31 projects they funded. One of those was Project LIBERTY, about which the study had this to say:

The research being conducted at POET Project Liberty is on the cutting edge of ethanol production research and has the potential to provide significant benefit to the State of Iowa. The project includes the transformation of a traditional ethanol biorefinery into an integrated corn‐to‐ethanol and cellulose‐to‐ethanol biorefinery. POET hopes to validate the technology and economics at commercial scale at multiple POET biorefineries in Iowa. The project will use corn grain and corn cobs to produce conventional and cellulosic ethanol in one facility. The corn suppliers and biorefinery operators seek to take advantage of the economies of scope ‐ reducing total average cost by increasing the number of different products produced. The POET project will reduce the state’s reliance on foreign oil by producing ethanol from renewable agriculture crops produced in Iowa.

For the economic impact, see the press release we issued last week.