Texas A&M Agriculture is scheduled to host U.S. Department of Agriculture Under Secretary Gale Buchanan and Texas Agriculture Commissioner Todd Staples today for a behind-the-scenes tour of some of the most promising biomass research efforts within The Texas A&M University System.
 

“Corn is a viable way to produce ethanol from starch,” said Dr. Elsa Murano, who serves as Vice Chancellor of Agriculture and Life Sciences for the A&M System and also directs the Texas Agricultural Experiment Station, where scientists are digging into a range of biofuels alternatives. “But that’s not the only option for Texas and the southern part of the country.”
 

Texas not only grow corn for biofuels, but it can also capitalize on decades of sorghum research at the Experiment Station, Murano said. The giant sorghum varieties being grown in experimental plots today are drought-tolerant, can be grown across the state, and offer high yields in ethanol.  “Based upon our analyses, we find it’s efficient to take something like our new sorghum varieties or sugar cane that produces large volumes of biomass, rather than producing grain and then converting grain-starch to ethanol,” Murano said.
 

Texas is uniquely posed to take advantage of this developing technology as a leading agricultural state with a large forest industry, a major biomass producer with diverse growing environments, and major universities and agencies with energy expertise, said Bob Avant, program manager for the A&M System’s Texas Agricultural Experiment Station.
 

Avant adds that Texas is an energy-friendly state, producing 26% of the U.S. domestic oil and 29% of natural gas.  The state already has an “extensive energy infrastructure in place,” with 26 existing refineries, 135,000 miles of natural gas pipeline, and a large structure of pipelines for transporting crude oil and liquefied petroleum gas.

The American Coalition for Ethanol (ACE) offered  testimony for yesterday’s field hearing of the U.S. Senate Agriculture Committee’s Subcommittee on Energy, Science, and Technology.

 
The event was held on the campus of South Dakota State University in Brookings and was hosted by Senator John Thune (R-SD), the subcommittee’s ranking member.  The event, “The Next Generation of Biofuels: Cellulosic Ethanol and the 2007 Farm Bill,” was a forum for discussing how the 2007 Farm Bill can play a role in directing the development of the biofuels industry, especially the commercialization of cellulosic ethanol.

“Given the likelihood that the next Farm Bill will contain a meaningful energy title designed to promote biofuels and renewable energy, ACE is grateful for the opportunity to submit testimony at this field hearing on behalf of the U.S. ethanol industry,” said Brian Jennings, ACE executive VP.  “We are also pleased that the hearing featured the expertise of two ACE member ethanol companies helping develop the technology breakthroughs necessary to commercialize cellulosic ethanol - Poet Energy and VeraSun Energy.”

In its testimony, ACE outlined cellulosic ethanol’s greta potential, as well as the four overriding challenges to making cellulosic ethanol a commercial-scale reality: 1)the cost and complexity of converting biomass feedstocks into ethanol, 2) the capital costs of financing and constructing cellulosic biorefineries, 3) feedstock challenges (how and where to grow the feedstocks; how to harvest, collect, transport, and store biomass), and 4) sustainability challenges (respecting soil quality, wildlife habitat, land conservation practices).

ACE pointed to the limitations of the “blend market” and the limitations of how much corn can be used for ethanol as reinforcements of the need for cellulosic ethanol to become a reality in the near future. “There is an intersection between what we refer to as the ‘blend market,’ where E10 comprises virtually every gallon of motor fuel in the U.S., and the upward limitations of how much corn we can distill into fuel ethanol, reinforcing the need to make cellulosic ethanol a reality if we are to achieve a more meaningful reduction in fossil fuel use,” Jennings testified.

In the testimony, ACE encouraged Congress to consider a public policy framework to help create certainty for cellulosic and corn-based ethanol.  The framework contains the following:
- expanding the RFS to reach 10 billion gallons of biofuels per year by 2010, 30 billion gallons by 2020, 60 billion gallons by 2030
- promoting the use of higher blends of ethanol is the existing fleet of automobiles
- increasing funding for and consolidating federal cellulosic biofuels loan guarantee programs into a single program at USDA
- establishing a pilot cellulosic biofuels feedstock program
- requiring automakers to ensure that all vehicles in the U.S. are FFV and require installation of E85 and/or blender pump at all gas stations affiliated with major oil companies
- establishing a cost-share program under Title IX of the Farm Bill to provide assistance to ethanol plants for the installation of low-carbon processing and conversion technologies
- extending the Blender’s Credit for ethanol beyond 2010 and retain the existing secondary import tariff offset on imported ethanol

Yesterday, Senator Pat Roberts applauded the U.S. Department of Energy’s selection of Abengoa Bioenergy Biomass of Kansas to receive a $76 million federal investment to locate a cellulosic ethanol plant in Kansas.

The plant will use 700 tons per day of corn stover, wheat straw, milo stubble, switchgrass, and other feedstocks, and will produce 11.4 million gallons of ethanol annually and enough energy to power the facility; any excess energy will be used to power the adjacent corn dry grind mill.  Kansas was one of six locations chosen to help bring cellulosic ethanol to the market.

Roberts delivered the following statement: “I am very pleased the Department of Energy has chosen to make this significant investment in both renewable fuels and ultimately, the Kansas economy. This technology is cutting edge and represents the next wave in renewable energy. This is an opportunity to grow our rural economy while reducing our nation’s dependence on foreign oil.”

President George Bush said yesterday that the key to keeping U.S. cattle and hog farmers from feeling the pinch from rising feed-corn prices is a breakthrough in cellulosic ethanol production technology.

Critics of the President’s energy policy say that Bush’s strategu of offsetting 35 billion gallons of gasoline use a year by 2017 with alternative fuels such as ethanol is unrealistic and could make feed-corn prices significantly more expensive.

Nonetheless, President Bush said he was confident in his goal, but it would require continued government funding. Cellulosic ethanol “is coming to fruition, and the role of the government is to stimulate thought and investment.” 

The Bush administration has asked Congress for up to $4 billion in loans guarantees for biofuel projects, which would include plans to build biorefineries and cellulosic ethanol plants, which produce motor fuel from biomass such as wood chips, switchgrass, and corn stover.

The President says his 35 billion gallon goal is supposed to help cut U.S. dependence on foreign crude supplies and address climate change through cleaner-fuel. The Administration is aiming that 20 billion gallons will come from cellulosic ethanol, with only around 15 billion gallons likely to be supplied through corn-based ethanol due to market constraints.

Presently, however, it’s technically unfeasible to produce cellulosic ethanol commercially because of the high cost of enzymes that break down the corn starch into sugar for fermentation, and some energy analysts wonder if a breakthrough is possible within the timeline set by Bush.

“I know it sounds like a pipe dream to some…(but) we’re on the verge of some breakthroughs that will enable a pile of woodchips to become the raw materials for fuels that will be able to run your car” he added.  If cellulosic ethanol doesn’t become commercially viable in time, the Buch administration is hoping to use coal-to-liquid production, another alternative fuel, to help meet the 35 billion gallon goal.

The National Cattlemen’s Beef Association has approved a policy urging the Bush administration to phase out government subsidies for ethanol production, to scrap the 54-cent-per-gallon tariff on imported ethanol, and to transition from corn-based to cellulosic ethanol.

At Saturday’s Cattle Industry Convention in Nashville, Agriculture Secretary Mike Johanns told U.S. cattle producers that the government would encourage alternative methods of making ethanol to protect them from rising corn prices.  “That is why we propose to accelerate our research into cost-effective ways of producing cellulosic ethanol from biomass,“ he said, noting that ethanol can be made using grasses, woody plants, wood waste, and sugar beets.

The proposed 2007 Farm Bill recommends spending $1.6 billion over the next 10 years on the development of cellulosic ethanol and proposes $2.1 billion in guaranteed loans for cellulosic projects as well as construction of production plants in rural areas.

Illinois’ Democratic Sen. Barack Obama says that ethanol will have to be a commercially viable alternative to gasoline if it is to significantly reduce U.S. dependence on foreign oil in the long run.  The U.S. government, he added, is going to have to make substantial investments to make that happen.
 
Obama, like other lawmakers, wants to see a lot more cars in the U.S powered by E85, which provides only about two-thirds of the mileage that gasoline does (ethanol has less energy content).  Ethanol is now primarily used as an oxygenate additive in gasoline. Cars that run on E85 are relatively rare in the U.S., but Obama said he owns one.

President Bush called for a 35-billion-gallon per year ethanol production standard by 2017 in his State of the Union address.  Many grain and biofuel analysts agree, however, that the U.S., in order to meet the president’s ethanol standard, will have to produce ethanol from cellulosic sources: wood chips, corn stalks, certain vegetation, ect.
 
In an interview with Dow Jones Newswire, Obama said: “I don’t think we want to end up in a situation which we are producing tons of ethanol that are simply having to be subsidized to support the infrastructure that’s already there. We want to make sure that it actually supplements and ultimately helps to replace our dependence on  foreign oil.  And that is going to require an investment on the front end.”
 
The U.S. Department of Agriculture announced Wednesday its intention to fund $1.6 billion worth of research into improving renewable fuels, but didn’t provide details on what kind of research would be supported.
 
Congress has begun debating how to further support the ethanol industry as lawmakers begin work this year on a new multi-year farm bill that is expected to contain a strong energy title. The U.S. implemented a 51-cents-per-gallon federal Volumetric Ethanol Excise Tax Credit in January 2005 that will be in place through 2010. There is also a 54-cents-per-gallon U.S. tariff to discourage ethanol imports that expires at the end of 2007.
 
 

Yesterday, Agriculture Secretary Mike Johanns announced plans to propose $1.6 billion in new funding for renewable energy, with a focus on cellulosic energy research and production, as part of the Administration’s 2007 farm bill proposals.

This funding will support President Bush’s goal of reducing gasoline usage by 20 percent in the next ten years and will compliment an array of renewable energy-related efforts underway at the USDA.

USDA spent nearly $1.7 billion on energy-related programs between 2001 and 2005, and last year alone, USDA spent over $270 million on these programs in areas such as commercialization, research, infrastructure development, and technical support. Currently, there are 110 operational ethanol plants in 19 states with another 73 under construction and new proposals at an astounding rate.

USDA’s Agriculture Research Service (ARS) scientists have developed improved fermentation organisms and are making other significant steps toward achieving the technology needed for commercial production of cellulosic ethanol. ARS scientists have genetically modified a strain of lactic acid bacteria that produces increased levels of ethanol from cellulosic biomass. The research findings demonstrate that metabolic engineering has the potential to create new biocatalysts to convert biomass to biofuels.

Johanns plans to provide additional information about the proposal to provide $1.6 billion in new funding for renewable energy within the next few weeks when he unveils the Administration’s full package of 2007 farm bill proposals.