The ASA highlighted accomplishments it made in several specific areas, including policy and advocacy, and domestic and international use of soy. Under the heading of policy and advocacy, the ASA noted it doggedly supported the biodiesel industry in an effort to extend the biodiesel tax credit in 2011, which helped the industry reach record biodiesel production levels in 2011. According to the ASA, it also worked alongside the United Soybean Board, U.S. Soybean Export Council, and soy exporters in an effort to maintain access for U.S. soybean exports to the EU that would otherwise be negatively affected by the EU’s Renewable Energy Directive. The ASA also noted that the U.S. government and the EU have agreed to enter into bilateral negotiations on how U.S. soybeans can be deemed compliant with RED requirements. In addition, the ASA efforts in the 2008 Farm Bill helped to establish the USDA’s BioPreferred program, a voluntary biobased product labeling program.

Regarding the use of soy, the ASA said record biodiesel production levels achieved in 2011 were the direct result of efforts by the National Biodiesel Board, the biodiesel industry and the ASA in supporting the development of a renewable fuel standard for biodiesel and extending the tax incentive through the end of 2011. In its statement, the ASA also noted its efforts have been supported by strong soybean checkoff investments in research and promotion.

The ASA also noted several key policy issues it intends to focus on in 2012, including defending the biodiesel portion of the renewable fuel standard and supporting the extension of the biodiesel tax incentive. The association also plans to work to maintain market access in the EU by addressing the treatment of U.S. soybeans under the RED.

A full list of the ASA’s 2011 accomplishments can be downloaded from the organization’s website.BIODIESEL MAGAZINE.

According to a statement released by Evogene, the impetus behind establishing the subsidiary is due to the need for diversifying feedstock supply to fulfill worldwide demand of biodiesel, which currently relies mainly on edible oils such as soybeans and canola.

Originally launched in 2007, Evogene’s biofuel activity targets the development of second-gen feedstocks to serve as sustainable, viable and cost-effective sources of oil for the burgeoning global biodiesel industry. In addition to its castor bean seed development and commercialization efforts, the company stated that it “intends to broaden its activity to additional potential feedstocks for the biodiesel, biojet and ethanol markets.”

“With the biofuel industry’s continued growth and tremendous demand for cost-competitive feedstock, there is a strong and immediate need for a solution based on designated second-generation seed products,” said Ofer Haviv, president and CEO of Evogene. “The establishment of Evofuel as a separate company strongly positions it to address this substantial unmet need. We are reinforced by the progress and results of our castor seed in Brazil and believe that access to Evogene’s leading plant genomics capabilities will provide Evofuel with commercial advantages and opportunities in relevant markets.”

The formation of Evofuel follows on the heels of Evogene successfully completing field trials for its advanced castor varieties in Brazil in cooperation with SLC Agricola S.A., a leading agribusiness firm in the country, which will be cultivated for biodiesel feedstock. Under the expanded agreement, Evogene and SLC Agricola intend to continue to evaluate Evogene’s castor varieties at its farm locations in Brazil. The goal is to identify the best performing varieties and agronomic practices suitable for commercial-scale production.

In addition to Brazil and Israel, field trials of castor been cultivars are also being conducted in the U.S.; most notably at Texas A&M University. Additional collaborators in the program include NASA and Honeywell’s UOP.

In mid-2010, Evogene announced that biobased jet fuel produced using its castor varieties met international standards for alternative aviation fuels. The testing was completed in collaboration with NASA and Honeywell’s UOP. Also in 2010, the company announced that a life-cycle analysis of biodiesel using its castor varieties demonstrated a 90 percent greenhouse gas reduction when compared to petroleum.BIODIESEL MAGAZINE.

The EPA’s designation of Canadian crops as a renewable biomass will allow U.S. biofuel makers to collect tax credits for using them, said Canola Council of Canada president JoAnne Buth.

“I suspect we will see more canola moving into the U.S. now,” Buth said in an interview.

ICE Canada canola futures closed up 1.9 percent exceeding gains in other related markets. Canada becomes the first country outside the United States to receive approval under the EPA’s land use test on an aggregate basis, said Ben Evans, spokesman for the U.S.-based National Biodiesel Board.

That means Canada has provided assurances that overall it is not bringing more net farm land into production, so farmers don’t have to individually prove the same thing to qualify under the U.S. biodiesel mandate.

The U.S. Congress has set a goal of blending 36 billion gallons of renewable fuel into transportation fuel by 2022 and that target is large enough that there’s little risk of Canadian crops displacing U.S. feedstocks like soybeans from the biodiesel mix, Evans said.

 “I don’t think you’ll see a huge flood, but a gradual increase” of canola entering the U.S. biodiesel industry, Evans said in an interview. “It’s a positive development.”

In 2010, soybean oil made up half of the feedstock used in production of U.S. biodiesel, followed by animal fats, Evans said.

The U.S. Canola Association also supports the decision, said Dale Thorenson, the association’s assistant director.

Last year, the EPA placed canola oil on an equal footing with soyoil, ruling that it emits low enough greenhouse gas levels to qualify for the U.S. mandate to increase renewable fuel production.

 That decision allowed biodiesel makers to get credits for using U.S. canola, but Canadian crops did not qualify.

Canada is the world’s top exporter of canola, a rapeseed variant that is used mostly for vegetable oil and livestock feed. Top Canadian canola crushers include Cargill Inc, Viterra Inc, Bunge Ltd, Richardson International Limited, Louis Dreyfus and Archer Daniels Midland.

Canada is normally a net importer of corn.

(Reporting by Rod Nickel; Editing by David Gregorio and Sofina Mirza-Reid)

LONDON (Reuters) – Major British independent oil firm Greenergy sees its future as an exploration company, but one that hunts for fuel in piles of stale pork pies and cakes rather than under the ground or from food crops.

The refined oil product wholesaler is still investing in the embattled European Union biodiesel sector, aiming to utilise ever more challenging waste products after abandoning, at least for now, the widely criticised use of virgin vegetable oils.

“We are investing more and more so we can take harder and harder wastes to process. By late spring or early summer next year we will be able to take almost any liquid you can imagine,” Greenergy founder and chairman Andrew Owens said in an interview on Wednesday.

The European Union’s biofuels industry has struggled to attract funds and expand during the eurozone’s economic crisis, hurt not only by a challenging investment climate but also questions about the sector’s environmental credentials.

Biofuels had been seen playing a central role in helping the EU achieve its target of meeting 10 percent of road transport fuel needs from renewable sources by 2020.

Political support has wavered as scientists raised concerns about the environmental impact of diverting food crops to biofuel production.

Greenergy’s biodiesel plant at Immingham in eastern England was built to use vegetable oils but in the last couple of years the company has built units to pre-treat and post-treat production to allow use of waste such as used cooking oil.

The plant now has the capacity to produce nearly 200,000 tonnes of biodiesel from waste products.

EXPLORING PIES

“We get pork pies, crisps, cakes, dairy products that are not suitable for sale anymore because they have got too old or been damaged in the factory and we can extract fats and oils to make biodiesel,” Owens said.

The move to waste was prompted partly high vegetable oil prices, which made it hard to process them into biodiesel profitably, potential extra regulatory benefits from processing waste and a company target to achieving 70 percent greenhouse gas savings across all its biofuels.

“We are focussed on trying to broaden the feedstock base. We are becoming an exploration company but we are not exploring oil fields, we are exploring pies,” he added.

Owens said the EU’s biodiesel sector faced two main challenges, a massive over investment in capacity across Europe and continuous political tinkering and uncertainty.

He said investment decisions had to be made based on “intuition and common sense” in the absence of a clear future framework for the industry.

“The problem with political decisions is that common sense isn’t always one of the biggest drivers towards the decision,” he said.

But Owens said he remained hopeful about the future of the EU’s biodiesel industry.

He said bioethanol, a substitute for gasoline that is generally produced from grains and sugar crops, was now the cheapest way for oil companies to comply with obligations to blend biofuels into motor fuel.

But the EU overall had too much gasoline and not enough diesel.

“The point that people should not forget is that Europe remains short of diesel. This remains an absolutely pivotal issue,” he said.

“Biodiesel fills a strategic hole in the energy balance which bioethanol doesn’t do to the same extent.”

(Reporting by Nigel Hunt; Editing by Anthony Barker).

SOURCE: REUTERS

Becky Williams removes a pumping tube from a truck delivering oil to Renewable Energy Group’s biodiesel plant in Glenville, Minn. The plant was idled in March 2008 but has a new lease on life. (Renee Jones Schneider, MCT / September 19, 2011).Lufthansa flights take off using biofuel mix in engines./By David Shaffer.

Reporting from Glenville, Minn.— For more than three years, the SoyMor Biodiesel plant sat idle — victim of a slump that took down more than a quarter of the plants in the industry.

But biodiesel is booming again, and a sign of the revival happened recently in this small southern Minnesota town. Workers started up the plant, and soon the fuel was flowing.

“Everybody kept their fingers crossed and hoped it would be a lot shorter,” rehired worker Aaron Kuennen said of the long layoff as he unloaded tanker trucks full of soybean oil Thursday.

Across the nation, biodiesel plants have been restarting or ramping up production, spurred by a revived federal tax credit and renewable energy mandates. The industry’s trade group, the National Biodiesel Board, last month reported that U.S. production was headed toward a record year after three consecutive months of record output.

It comes after biodiesel’s big bust. At least 52 of the nation’s 170 biodiesel plants were idled last year, and others scaled back production, according to the U.S. Environmental Protection Agency. In the two years that ended in December, output of U.S. biodiesel for trucks and heavy equipment fell 54%.

In Minnesota, the Glenville plant was among the first to shut down. Its local owners last month sold the plant to the Ames, Iowa, company that built and formerly managed it, Renewable Energy Group Inc.

The plant’s sign now is draped with a temporary one bearing the company’s initials: REG.

Another of Minnesota’s four biodiesel plants, FUMPA Bio-fuels in Redwood Falls, has remained closed since December. The plant, the state’s first biodiesel producer in 2004, is for sale, and because it’s small and portable, it probably will be moved after it is sold, said Chuck Neece, who heads the biofuels division of the cooperative that owns it.

The U.S. biodiesel industry grew out of a desire by soybean farmers to get better prices early in the last decade.

Minnesota began requiring that biodiesel be blended into diesel fuel sold at pumps in 2005 and now mandates a 5% mix. Nineteen other states offer various incentives in addition to the federal tax credit that has encouraged blenders to use biodiesel in motor fuel.

At first, biodiesel producers relied almost entirely on soybean oil as a feedstock, subjecting it to a chemical reaction with alcohol to produce fuel similar to petroleum diesel. Some plants now have the technology to process waste oils from restaurants and unrefined oils and fats from rendering, meatpacking and ethanol industries. About half of U.S. production still is derived from soy oil, industry officials said.

In the industry’s first boom, U.S. output expanded eightfold from 2004 to 2008, peaking at 691 million gallons annually.

“It was awfully exciting,” said Ed Hegland, a farmer near Appleton, Minn., who served as chairman of the National Biodiesel Board from 2007 to 2010.

Then the troubles hit — the global financial meltdown, trade barriers that hurt sales to Europe and high soybean prices, Hegland and others said. The worst blow came last year when Congress temporarily eliminated a $1-a-gallon tax credit to encourage blenders to use biofuel.

“It was extremely difficult to see a renewable energy industry that was just getting legs under it to be so dramatically set back by a number of things out of our control,” Hegland said.

At the Glenville biodiesel plant, one of two large Minnesota plants with capacities of 30 million gallons a year, the end came suddenly in March 2008. Rachel Asmus, who recently returned to run the plant’s lab, remembered the shock and sadness. “One week I had a job,” she said. “Then they told us we wouldn’t have jobs at the end of the week.”

Biodiesel’s revival began after Congress in December restored the tax credit for one year and the EPA established higher biodiesel blending mandates under its renewable fuel standards.

At some plants, production ramped up immediately. But the SoyMor plant in Glenville remained idle until it was sold in July in a stock transaction to REG, the nation’s largest biodiesel producer.

In a major industry consolidation, REG has acquired three other plants in the last 18 months. It wants to raise $100 million in an initial public stock offering to acquire another plant it now leases. It also wants to complete work on three plants whose construction was halted during the biodiesel bust.

Myron Danzer, who manages the Glenville plant and two others for REG, said the restart went smoothly. Some electrical components had been damaged by a voltage surge. One pipe was damaged by freezing, others needed to be cleaned and everything needed to be tested, he said.

He hired 20 people, including five former workers, and by Wednesday the first soybean oil was pumped into the system. Six hours later, at 9:14 p.m., Danzer was holding a flashlight and “sitting up on the tank waiting for it to come in.” After the first gallons flowed, everyone gathered in the plant’s control room to celebrate.

“It’s been running ever since then,” he said, and over the first 24 hours had processed about 50,000 gallons. Tanker trucks will begin hauling fuel to blenders this week, he said.

After experiencing one bust, many in the industry wonder whether this plant and others will keep running, given the recent resistance in Congress to extending biofuel tax credits. The industry has been lobbying to retain the $1-a-gallon credit, and Rep. Collin C. Peterson (D-Minn.), an industry supporter, is co-sponsor of the House bill.

One question is whether the EPA mandate to blend biodiesel into motor fuels — without the tax incentive to blenders — is enough to keep the industry growing. The effect would be to boost the cost of biodiesel to blenders who supply fuel to pumps.

“It will be very, very challenging as we have seen last year with the lapse of the tax credit,” said Hegland, who is on the board of the Minnesota Soybean Growers Assn. “I think it would cause a significant downturn in the market.”

Shaffer writes for the Star Tribune (Minneapolis)/McClatchy.

SOURCE: Los Angeles Times

* Production to be ramped up in stages

* Lifts Neste Oil’s total renewable diesel capacity to 2 mln tonnes a year (Adds CEO comments)

HELSINKI, Sept 20 – Neste Oil has started up its new renewable diesel plant in Rotterdam, in the Netherlands, the Finnish refiner said on Tuesday.

The plant, with a total capacity of 800,000 tonnes per year, is the largest in Europe and can make renewable diesel from different types of vegetable oils and waste fats.

Production of renewable diesel would be ramped up in stages, the company said.

“With its start-up, our major 1.5 billion euros ($2.0 bln) investment program aimed at increasing our renewable diesel production capacity has entered its final stage,” Neste Oil Chief Executive Matti Lievonen said in a statement.

The new plant lifts Neste Oil’s total renewable diesel capacity to 2 million tonnes per year. Last year Neste Oil opened a similar plant in Singapore and it has two renewable diesel lines in Porvoo, Finland. ($1 = 0.735 Euros) (Reporting by Helsinki Newsroom).REUTERS.

Chemical engineer Sá Parente “created biodiesel which is a motive of pride for all Brazilians” recalled President Rousseff in an official release underlining that “the discovery patented by Brazil, had a wide international acknowledgement and has had a decisive influence in the country’s future.”

His dedication to bio-diesel “produced from the raw material developed by thousands of farmers’ families contributed significantly to reduce rural poverty,” added Ms Rousseff.

Brazil is the world’s second largest producer of biofuels behind the US and has 74 plants with an annual capacity of six million cubic meters. Production in 2010 was 2.4 million cubic meters involving 276.000 small farmers.

But the issue is also controversial. Biofuels help save on fossil fuels and cuts drastically the emission of greenhouse gases which affect world warming and climate change. There are also benefits for farmers who can supply the market with a high value produce.

However biodiesel extracted from oilseeds and other grains has also triggered criticism since it contributes indirectly to increase the price of food items worldwide, as more farmland is dedicated to the production of biofuels.

The UN Food and Agriculture Organization has repeatedly warned that the production of biofuels puts pressure on food prices and could be responsible for as much as 60% of global increases.

Likewise biodiesel forces the expansion of the agriculture frontier which leads to deforestation and to exhaust soils.

Mercopress/BRAZZIL MAG

During the CNEX – Talking Points forum held at the Philippine Information Agency, PCA public relations officer Thelma Tolentino said government is considering to increase the current minimum two percent blend of coco-diesel due to its many benefits.

Although Tolentino did not mention a definite date of implementation, the Department of Energy earlier issued a policy that aims to increase to five percent the current mixture, to around 10 percent by 2015.

She said the potential of coco-biodiesel goes beyond its financial rewards to the millions of coconut farmers in the country.

We must also take into consideration its benefits to the economy and the environment, she said.

A recent study showed that coconut farmers stand to earn more than P2 billion per year in the sale of coconut oil, a primary ingredient of the coco-biodiesel.

Likewise, coco-biodiesel enhances the combustion performance of diesel engines for better effeciency and less pollution produced.

It said that the inherent oxygen content of coco-biodiesel promotes better combustion in the engine which translates to an increase in mileage by as much as 10 percent.PIA.

So what is the value proposition of doing this? Profits, as Mark Fashian, president of Ethanol Analytical Solutions (EAS) and Biodiesel Analytical Solutions (BAS) explained to me during a Skype interview following the Fuel Ethanol Workshop recently held in Indianapolis, Indiana. For example, Fashian said a 100 million gallon per year ethanol plant will sell 100 million RINS. By adding a 3 million gallon biodiesel plant you’ll make your plant more valuable because each of these gallons is worth 1.5 RINS, or an additional 4.5 million in total.

With demand for biodiesel increasing and the need for more gallons (the biodiesel industry is still ramping up after the one year loss of the $1 per gallon tax credit in 2009), Fashian said this is the perfect storm for the ethanol industry.

You can listen to my full interview with Mark Fashian here: Diversifying the Ethanol Industry with Biodiesel0:00 / 0:00DownloadRight-click and save as to download.

He also noted that one drawback to using corn oil for biodiesel is that it has a high acidic content, around 27.5 percent, and because of this it is hard to convert. Most plants use a two-step process to achieve this.

“It’s a lot of redo a batch, do a batch again because we didn’t get it just right, and that’s not what the ethanol industry is looking for,” said Fashian. “They’re looking for the silver bullet where you can take that corn oil right from the extractor and put it right in to another process to make biodiesel without having to mess with a second or third run to get the biodiesel to make ASTM grade. And that’s exactly what the McGyan process does. It’s patented for the corn oil process and with their everlasting catalyst you just pump the sample in with either ethanol or methanol and out the other end comes beautiful biodiesel.”

If a plant doesn’t have extraction technology, when all expenses are factored in, the return on investment (ROI) is less than one year, and this includes the lab. I should note that Fashian is also a director of Mcgyan and both EAS/BAS represent the technology. So their team would not only work with the ethanol plant on the biodiesel installation, but also help them update the lab for all the extra tests required for biodiesel and the proper equipment to achieve specs. For those plants who already have extraction technology, the ROI is less than 2 years.

It takes between 12-18 months to get the Mcgyan technology up and running and its already designed to be a perfect fit for an ethanol plant. Oh, and if you decide to sell your corn oil on the market rather than produce biodiesel, you can still produce biodiesel with other feedstocks.DOMESTIC FUEL.

The biodiesel plant owned by Spanish energy group Natura in Ocana, central Spain, March 26, 2007.Credit: Reuters/Susana Vera.

By Charlie Dunmore/BRUSSELS (Reuters) – The EU will protect existing investment in its $13 billion biodiesel sector even as it acts on new evidence that suggests making the fuel from food crops can do more harm than good in fighting climate change.

The environmental arguments in favor of using biodiesel were thrown into doubt last week by a series of leaked European Union reports, revealed by Reuters.

The reports said using Asian palm oil, South American soybeans and EU rapeseed to make biodiesel has a bigger overall impact than conventional diesel on climate change, partly due to forests or wetlands being destroyed to grow replacement food.

European Union policymakers are preparing a political compromise that will safeguard existing biodiesel investments, having baulked at penalizing individual biofuel crops.

While biodiesel producers will be given time to realize a return on the massive investment of recent years, the latest scientific findings are likely to lose them market share in coming years to bioethanol and advanced biofuels, which the reports found to be generally preferable.

Senior European Commission officials met in Brussels this week to debate policy options for addressing the indirect impacts of the bloc’s biofuel target, which aims to raise the share of biofuel in road transport to around 10 percent by 2020.

With biodiesel representing about 80 percent of Europe’s estimated $17 billion market for biofuels and the bloc dependent on diesel imports to meet rising demand, the officials agreed to delay any action that could kill off the biodiesel sector.

“I think they are going to arrive at a political compromise,” Philippe Tillous-Borde, chairman of the EU’s largest biodiesel producer, Diester Industrie, told Reuters.

Tillous-Borde and other biodiesel producers insist the science on the indirect impacts of biofuels is uncertain and still evolving and that it would be premature and unfair to regulate them out of existence now.

This argument has won support within the Commission, with the EU’s top farm official among those who argued against redrawing the investment map for biofuels overnight.

The Commission is due to adopt its proposals for approval by EU governments and lawmakers after the European summer break.

POLICY OPTIONS

The dilemma facing EU policymakers concerns a relatively new concept known as indirect land-use change (ILUC), which challenges the notion that biofuels only emit as much carbon when burned as they absorbed during growth.

ILUC means that if you take a field of grain and switch the crop to biofuel, somebody, somewhere, will go hungry unless those missing tonnes of grain are grown elsewhere.

If the crops making up the shortfall are grown on farmland created by cutting down forests or draining peat land, this can pump out enough climate-warming emissions to cancel out any benefits from biofuels.

The Commission considered several options proposed by experts to address ILUC, including a direct one that penalizes individual biofuel crops according to their role in driving land use changes, which would have hit biodiesel hardest.

But EU sources said the Commission dismissed this option in favor of a second, indirect, approach, which involves raising the current carbon-saving threshold — compared with fossil fuel — that all biofuels must meet to count toward the EU’s target.

This option penalizes all types of biofuels equally and will therefore minimize short-term damage to the biodiesel sector.

Commission officials say this is justified because the huge private investment in biodiesel production in recent years is largely the result of the EU’s biofuel mandate and any shift in the policy must be gradual to avoid widespread bankruptcies.

Critics say this approach ignores a growing expert consensus that various biofuel crops have vastly different ILUC impacts.

“I fear a political compromise,” said Bas Eickhout, a Dutch Green member of the European Parliament who led research into the land-use change impact of biofuels.

“I’m negative about this solution of raising the threshold for all biofuels, (because) you’re not distinguishing between crop types. There are good crops and less good crops, and the policies need to take account of that,” Eickhout told Reuters.

EU bioethanol producers, who would benefit more from a direct approach to ILUC than under the compromise option, are undecided about whether to argue for a crop-specific approach.

NEXT GENERATION

While the impact of the EU proposals will not be as negative for biodiesel as the sector had feared, some types of production may yet be excluded — depending on how high the Commission raises the carbon saving thresholds.

The current limits require all biofuels to deliver carbon savings of at least 35 percent versus fossil fuel by 2013, rising to 50 percent in 2017.

“If we go from 35 percent to 45 percent in the short-term, that would be acceptable. If we go above that, It would be difficult,” Tillous-Borde said.

“If for the 2017 horizon, which was for 50 percent, we go from 50 to 60 percent, we will find a way to achieve it.”

With current production processes, even at 60 percent biodiesel made from imported soybeans and palm oil or European rapeseed would be excluded, according to one of the leaked reports — a Commission impact assessment of the policy options.

“Note, however, that rapeseed is not very far from meeting the threshold, which implies that low-emitting producers of rapeseed might still be able to comply (after 2017) if their direct performance is improved,” the report said.

The prospect of excluding imported vegetable oils from counting toward the EU biofuel target may appeal to domestic producers, but major exporters such as Malaysia and Brazil could be expected to challenge such a move.

While Europe’s biodiesel sector is likely to be granted a temporary reprieve by Brussels, its longer term prospects have been seriously undermined in the ILUC debate.

This could have a major impact on the direction of investments in low-carbon energy sources by major oil companies such as BP and Royal Dutch Shell.

Biodiesel’s loss would create gains for major EU bioethanol producers such as Abengoa Bioenergy and Tereos Internacional SA.

Ultimately, the ILUC debate will accelerate the switch to advanced biofuels made from algae or household waste, which do not require land, boosting companies developing them, such as Danish enzymes producer Novozymes. (Additional reporting by Pete Harrison in Brussels and Sybille de la Hamaide in Paris, editing by Rex Merrifield and Anthony Barker).REUTERS.