What's New in the Renewable Fuels Industry

Corn Degermination Project Announced

The U.S. National Corn Growers Association (NCGA) and Heartland Grain Fuels, LP, an ethanol producer, have reached an agreement to host a degermination project at Heartland's Aberdeen, South Dakota facility. Degermination is the process of separating the germ from the corn kernel before fermentation in the ethanol production process, allowing plants to process more grain, more efficiently.

"If successful, this will offer new profitability opportunities for local plants," said Lee Klein, president-elect of NCGA. "Degerm could add value from 20 cents to 35 cents per bushel of corn processed to ethanol."

13 Schools to Compete in the SAE Clean Snowmobile Challenge 2001

Thirteen U.S. and Canadian universities will compete in the Society of Automotive Engineers (SAE) Clean Snowmobile Challenge (CSC) 2001, scheduled for March 27-31, in Jackson Hole, Wyoming. The returning team from the University of Waterloo took second place in 2000. A second Canadian team of students from the University of Alberta will be new to the competition in 2001.

The SAE CSC is an intercollegiate design competition that requires engineering student teams to design a snowmobile with reduced emissions and noise characteristics that also equals or improves upon the performance of current snowmobiles. All but one of the teams participating in 2000 used 10% ethanol-blended fuel as part of their emissions reduction strategies, with enormous success. Ethanol blends will again be an important part of the competitionin 2001.

Ethanol Plant to Open in Sweden

A project is underway in Norrkoping, Sweden, to build a production facility designed to blend domestically pure ethanol with gasoline. The ethanol-blended fuel will be sold in Stockholm, Norrkping and Sodertalje by Shell, Norsk Hydro, Statoil, Preem, OK-Q8 and Jet.

The ethanol production site is close to the oil depot and a biomass-fired power plant. The facility will produce 50,000 cubic meters of ethanol and 45,000 tonnes of distillers dried grains, annually. The steam and electrical power needed to operate the plant both originate from renewable resources.

NPI and OSU Work Toward Biodiesel Certification

Needful Provision Inc. (NPI) and Oklahoma State University (OSU) recently agreed to undertake joint research to expedite the certification and commercialization of NPI's biodiesel technologies. NPI uses microalgae to produce 60 percent biodiesel and 40 percent coproducts.

Japan Science and Technology recently predicted that the biodiesel market could reach $70 billion annually by 2005.

Biodiesel is Being Used in U.S. Bus Fleets

500,000 gallons of B20, a blend of 20% biodiesel mixed with 80% petroleum diesel, will power over 280 buses in Kentucky and Ohio through July and August. The buses are expected to run 2,500,000 miles using this alternative fuel. Griffin Indutries has been selected to supply the biodiesel. Griffin produces biodiesel from recycled vegetable oil collected from area restaurants.

"Any resident who has eaten at a tri-state restaurant in the past 18 months has likely contributed to the production of biodiesel and therefore, reduced our country's dependence on foreign oil," said Rick Geise, Griffin's Director of Marketing.

Minnesota Pushes for E85 Funding

A group of Minnesota legislators hopes to gain $30 million worth of state funding over the next five years to install E85 pumps at many of the region's gasoline stations. E85 is a blend of 85% ethanol and 15% gasoline.

Ethanol industry officials said there are currently about 40,000 flexible fuel vehicles (FFVs) (designed to operate on E85, regular unleaded gasoline, or any combination thereof) registered in Minnesota.

The plan offers gas station owners matching grants up to $20,000 to install the E85 stations. The plan will offer stations that have already installed the E85 pumps a tax exemption on the equipment that they purchashed. The plan would also require Minnesota officials to purchase FFVs for their fleets when the option is available.

Gasoline Prices Spur Interest in E85

Recent gasoline price hikes in the U.S. Midwest have spurred interest in E85, a fuel blend of 85% ethanol and 15% gasoline. According to fuel retailers, consumers are eager to fill their tanks with E85. One gasoline station owner in Bloomington, Illinois said that his E85 sells for $1.60 a gallon compared to gasoline at almost $1.83 per gallon. In Chicago, the difference in price is more than 40 cents per gallon.

There is currently only one above-ground tank dispensing E85 in Canada, located in Ottawa.

U.S. Lawmakers Urged to Develop a National Energy Plan that Promotes Ethanol

Eric Vaughn, president of the U.S. Renewable Fuels Association recently urged lawmakers to create an energy policy that was resistant to the dramatic price swings evidenced earlier this year. He cautioned against supply mismanagement and the likelihood of another increase in gasoline prices. According to Vaughn, the U.S. needs to adopt a proactive energy policy that ends turbulent energy crises. U.S. RFA suggested that ethanol can play an important role in energy and economic independence.

"Expanding the extent of ethanol blending in conventional gasoline would be the most timely and effective means of increasing liquid fuel supplies and lowering consumer costs," said Vaughn. "The U.S. energy policy should look for domestic renewable sources to cover the current shortfall in refinery capacity."

U.S. EPA Wins Court Challenge

Exxon Mobil Corp. and Chevron Corp. have lost a court challenge of a U.S. Environmental Protection Agency ruling that allows states to set tougher clean fuel standards than the federal government.

The U.S. Ninth Circuit Court of Appeals in San Fransisco upheld an EPA ruling that Clark County, Nevada, can require companies to sell gasoline with a minimum 3.5 percent oxygen content during the winter season. The requirement is intended to cut down carbon monoxide emissions in the Las Vegas area.

The federal Clean Air Act of 1990 requires refiners to make and sell oxygenated, or reformulated, gasoline in the most polluted areas of the U.S. by using additives like ethanol or MTBE. The EPA is seeking a national ban on MTBE, which it says is leaking from gas storage tanks into drinking water supplies.

A New Sweetener is a Potential Co-Product of Ethanol

U.S. Agricultural Research Service scientists have developed a new process that can turn corn fiber produced during ethanol production into a high-value, low-calorie sweetener for niche markets. The sweetener is a white crystalline powder called xylitol. Xylitol has one-third fewer calories than sugar and about the same sweetening power. An article about the research is available online at: http://www.ars.usda/gov/is/AR/archive/jul00/xylit0700.htm.

Report Cites that Ethanol is not the Cause for High Midwest Gasoline Prices

The U.S. Congressional Research Service has issued a report citing that gasoline problems, not ethanol, are the main factor in high gasoline prices in the Midwest.

According to the Oil Price Information Service, the average Chicago wholesale price for reformulated gasoline (RFG) blended with ethanol remains below the price for conventional gasoline (with no clean air modifications or ethanol blending). Ethanol RFG has been equal or lower priced than conventional gasoline for a week.

Biodiesel is the First Alternative Fuel to Complete Clean Air Tests
Biodiesel has become the first and only alternative fuel to have successfully completed the health effects testing requirements of the U.S. Clean Air Act Amendments of 1990. The tests show that biodiesel poses no health threats and its use results in a 90% reduction in air toxics. Biodiesel is non-toxic, biodegradable and is used in conventional diesel engines with little or no modifications.

2000 International Fuel Ethanol Workshop and Trade Show
For the first time in its 16-year history, the prestigious International Fuel Ethanol Workshop and Trade Show (FEW) was held in Canada from June 20-23 2000 in Windsor, Ontario, beginning just after CRFA's Annual Meeting and Convention. The FEW brought together ethanol producers, industry suppliers, researchers, and policy makers from around the globe to discuss the latest issues facing the fuel ethanol industry. The agenda for the FEW featured prominent speakers including Natural Resources Minister Ralph Goodale and Agriculture and Agri-Food Minister Lyle Vanclief.

"The 2000 FEW had a very strong program, dealing with all major issues facing the fuel ethanol industry," said Mike Bryan, President of Bryan and Bryan Inc., workshop presenters. "We had over seventy speakers and approximately 500 participants - the 2000 FEW was a great success."

GM to Build Flex-Fuel Full-Size SUV's in 2002 MY
Beginning in the 2002 model year, all Chevrolet Suburbans and Tahoes and GMC Yukons and Yukon XL's equipped with 5.3 litre V8 can run on varying blends of ethanol and gasoline - from 100% gasoline up to 85% ethanol (E85). The all-new Chevrolet Avalanche "ultimate utility vehicle" with the standard 5.3 litre V8 will also have E85 capability beginning in the 2003 model year.

CRFA Applauds the City of Guelph on National Clean Air Day
The Canadian Renewable Fuels Association (CRFA) applauds the efforts of municipalities in promoting cleaner air. Today, on National Clean Air Day, in an initiative to encourage public awareness, the City of Guelph is holding its first Clean Air Festival around potential solutions to smog and global warming.

In partnership with the Green Plan Steering Committee, the Federation of Canadian Municipalities and the International Council for Local Environmental Initiatives, the City of Guelph is participating in the national campaign for Climate Protection to improve air quality in communities across the country. CRFA will be participating in the City of Guelph's clean air activities through a day-long display in the River Run Centre.

CRFA Annual Meeting Coming Up in Windsor, Ontario on June 20

The Canadian Renewable Fuels Association (CRFA) will be holding its Annual Meeting and Convention in Windsor, Ontario on the morning of June 20, 2000. The half day event, preceding the 2000 Fuel Ethanol Workshop (FEW), features speakers from across North America on current issues in the ethanol and biodiesel industries.

"We are pleased to present a panel of knowledgeable speakers on current issues", said Jim Johnson, president of the CRFA. "CRFA's Annual Meeting and Convention will focus on consumer and environmental issues to complement FEW's focus on ethanol production. Ethanol has taken the Canadian spotlight several times this year, and the biodiesel industry continues to develop, with significant promise as a diesel fuel additive."

Barbara Charnes' (Coloradans for Clean Air) presentation of Denver's experience in implementing a clean air program will be a highlight of the agenda. Dr. Roydon Fraser, University of Waterloo, will report on his experience using ethanol in the Ethanol Vehicle Challenge and Clean Snowmobile Challenge competitions with E85-dedicated vehicles and snowmobiles using a low-level blend of ethanol. The program also offers an update on developments in the biodiesel industry. Don McCabe, Ontario Corn Producers' Association, will provide an overview of opportunities for renewable fuels through Canada's Climate Change Strategy, from an agricultural perspective.

For more information on the Annual Meeting and Convention, or to register, please contact CRFA at (519) 767-0431 or e-mail publicinfo@greenfuels.org.

Government and Industry Representatives Wish Good Luck to Ontario Collegiate Teams Ready to Start Their Engines on Ethanol

In a ceremony in Guelph, on May 2, 2000, the Canadian Renewable Fuels Association (CRFA), Ontario Corn Producers' Association (OCPA) and ethanol-blend gasoline retailer UPI Inc. joined together with local dignitaries and event sponsors to wish the Ontario teams participating in the Ethanol Vehicle Challenge (EVC) 2000 good luck in the upcoming competition. Teams from the University of Waterloo and the University of Windsor - St. Clair College will be taking part in the event with modified Chevrolet Silverados, optimized to operate on E85, a blend of 85% renewable ethanol and 15% gasoline.

"In blends of up to 10%, ethanol is already acclaimed for its ability to reduce global warming-inducing and smog-forming emissions. EVC 2000 will clearly demonstrate the potential of ethanol as the industry moves toward higher level blends," said Jim Johnson, president of CRFA. "We wish the teams success in their endeavours to develop an advanced design for an E85 dedicated vehicle."

The EVC is a collective effort from industry, government, and academia to produce leading-edge automotive technology that will reduce emissions and improve performance using environmentally friendly ethanol. Sixteen North American collegiate teams will take part in the event, from May 13-20, along a route from Ottawa to Windsor. The modified trucks will be tested for emissions, acceleration, trailer towing, cold start, off-road performance, fuel economy, design, and appearance. It is anticipated that this year, at least one of the teams will achieve Ultra-Low Emissions Vehicle (ULEV) standards.

The third Canadian team taking part in EVC 2000, from the University of Alberta at Edmonton, also participated in a send-off ceremony with well wishes from sponsors and dignitaries. Hosted by ethanol producer and team sponsor API Grain Processors, the event took place in Red Deer Alberta, today.

On Your Marks! Ethanol Vehicle Challenge Begins May 13

Students from 16 universities and colleges across North America are putting the final touches on their Chevrolet Silverado pick-up trucks, optimized to operate on E85, a blend of 85% renewable ethanol and 15% gasoline. From May 13-20, they will be competing in the Ethanol Vehicle Challenge (EVC) 2000, which will take place along a route between Ottawa and Windsor, Ontario. The modified Silverados are tested for emissions, acceleration, trailer towing, fuel economy, off-road handling, cold start, and design.

"For the first time in its three year history, the EVC will be coming to Canada", said Jim Johnson, president of the Canadian Renewable Fuels Association (CRFA). "CRFA is very excited about this opportunity to draw attention to fuel ethanol's performance and ability to significantly reduce vehicle emissions."

Ethanol is widely used in gasoline blends containing up to 10% ethanol that can be used without modification in existing vehicle technologies and are available at the same price as conventional gasoline.

"Past years of the EVC have testified to the performance and environmental potential of ethanol", said Johnson. "We look forward to the results of EVC 2000, where it is expected that at least one of the teams will achieve Ultra Low Emissions Vehicle standards."

Renewable Fuels Provide a Simple Way for Concerned Citizens to Improve the Environment on Earth Day

To celebrate Earth Day on April 22, consumers can contribute to reducing emissions from transportation and improving air quality by using renewable fuels. Using ethanol blends, in particular, has the potential to offer a simple solution to a complex problem.

"Earth Day challenges individuals to address environmental concerns", said Jim Johnson, president of the Canadian Renewable Fuels Association. "Using ethanol blends is a simple way for Canadians to contribute to the battle for a cleaner environment. Ethanol is available at 1,000 retail stations across Canada at the same price as conventional gasoline, on Earth Day and every day, and helps to improve air quality and curb global warming."

Biodiesel, another renewable transportation fuel, is being used to fuel Earth Day events in Washington D.C.

Industry and Government Join Together to Wish Academia Success

Representatives of government and industry will join together to wish the teams from the University of Waterloo and University of Windsor - St. Clair College taking part in the Ethanol Vehicle Challenge (EVC) 2000 good luck in the competition. The send-off event will take place in Guelph on May 2, and will provide a photo and discussion opportunity with the teams and their Chevrolet Silverado pick up trucks modified to operate on E85, a blend of 85% ethanol and 15% gasoline.

"Past EVC competitions have demonstrated that vehicles with significant environmental benefits, superior performance and excellent fuel economy are very feasible", said Jim Johnson, president of the Canadian Renewable Fuels Association (CRFA). "We look forward to the results of the 2000 competition, where it is expected that at least one of the teams will achieve Ultra Low Emissions Vehicle standards. Good luck to the participating teams."

EVC 2000 will take place entirely in Canada, for the first time. The event involves 16 North American collegiate teams challenged to optimize a Chevrolet Silverado to run on E85, reducing emissions and improving performance. From May 13-20, along the route from Ottawa to Windsor, the modified vehicles are tested for emissions, acceleration, trailer towing, cold start, off-road performance, fuel economy, design, and appearance.

The University of Waterloo Alternative Fuels Team achieved excellent results in the past two years of the EVC, including 2nd place overall in 1998, 4th place in 1999, and taking top awards in emissions reductions each year, and in oral design presentation last year. The Windsor-St. Clair Team and the University of Alberta Ethanol Vehicle Challenge team, the other Canadian teams taking part in the event, will be participating for the first time this year, competing with demonstration vehicles. Members from the Alberta team will also take part in a send-off ceremony, scheduled for May 2 in Red Deer.

Snowmobile Competition Shows Ethanol Reduces Emissions

Congratulations to the seven Canadian and U.S. collegiate teams who participated in the Society of Automotive Engineers Clean Snowmobile Challenge (SAE CSC) 2000, competing with modified snowmobiles designed to reduce emissions while maintaining performance. The teams demonstrated that ethanol blends can be an important tool in reducing emissions from snowmobiles.

"We are pleased with ethanol's part in the environmental performance demonstrated by the competition," said Jim Johnson, president of the Canadian Renewable Fuels Association (CRFA). "Ethanol plays an important role in reducing smog-forming emissions and curbing global warming. Low-level blends, containing up to 10% ethanol, can be used with excellent results in snowmobiles."

The leading two-stroke engine, designed by the University of Waterloo team, reduced carbon monoxide emissions by 50% and hydrocarbons by an astounding 95%, using ethanol as part of their emissions reduction strategy. The winning team, from the State University of New York at Buffalo, converted their snowmobile to a four-stroke engine to achieve superior overall performance in the competition. Four stroke engines are generally quieter and use less fuel than two-stroke engines, but they are typically heavier, costlier, and have more sluggish throttle response. Two-stroke engines are the standard for snowmobile manufacturers in North America.

The SAE CSC took place in Jackson Hole, Wyoming from March 28 - 31, 2000. Team EcoSnow from the University of Waterloo, who placed second overall, and the Ecole de Technologie Superieure (Montreal) represented Canada in this event. The Waterloo team had excellent results, taking top prize for teams using modified two-stroke engines. The teams were tested in categories including emissions, acceleration, noise, handling, fuel economy, and oral presentation. Unfortunately, the Quebec team had to drop out of the competition, due to lack of testing time for their advanced design.

CRFA reminds snowmobile owners to consult their owner's manual regarding fuel usage.

Tax Exemption on Ethanol in Saskatchewan

The Saskatchewan budget for 2000 introduces a tax incentive on ethanol. The budget reads:

"The Government is introducing a 5 year incentive that begins in 2000. It will rebate a portion of the Fuel Tax to the fuel wholesaler on eligible ethanol blended fuel produced and consumed in Saskatchewan."

Study Says Ethanol Industry Can Meet Demand

The U.S. Renewable Fuels Association (RFA) recently announced that the ethanol industry will be able to increase production to 3.5 billion gallons per year by 2004, according to a new study commissioned by the Governor's Ethanol Coalition. The study says this would easily meet demand for ethanol following the upcoming phase-out of the gasoline additive methyl tertiary butyl ether (MTBE).

"The results are in and the answer is clear," said RFA president Eric Vaughn. "Ethanol can easily replace MTBE in gasoline."

The study indicates that replacing MTBE in gasoline with ethanol would raise the price per bushel of corn by nearly 14 cents, while increasing household income in the agricultural sector by $2 billion dollars. In addition, using ethanol in gasoline could reduce the price per gallon by between two and five cents.

Clean Snowmobile Challenge Starts with Ethanol

The Society of Automotive Engineers Clean Snowmobile Challenge (SAE CSC) begins today in Jackson Hole, Wyoming. Ethanol is an important tool to assist the students in reducing emissions from their snowmobiles during the competition.

During the four-day SAE CSC competition, U.S. and Canadian college and university teams will vie to demonstrate that their modified sled has the lowest emissions without sacrificing performance. The snowmobiles will be tested for design, noise, exhaust emissions, fuel economy, cold start, acceleration, safety, handling, and hill climb performance. Ten per cent ethanol blends are part of the emissions-reductions strategies of six of the seven competing teams, including the University of Waterloo and the Ecole de Technologie Superieure (Montreal), the two Canadian teams taking part in the challenge.

"The Canadian Renewable Fuels Association realizes the importance of the Society of Automotive Engineers Clean Snowmobile Challenge and its significance to the sport of snowmobiling in Canada", said Jim Johnson, president of the Canadian Renewable Fuels Association (CRFA). "We expect that the results gathered from the competition will put to rest any doubts of ethanol's potential as an excellent alternative fuel for equipment with small engines."

In Yellowstone National Park, where ethanol blends are used exclusively, a 16% reduction in hydrocarbon emissions, a 25-70% reduction in particulate matter, and 9% reduction in carbon monoxide have been achieved using 10% ethanol-blended fuels. Because the ethanol portion is produced from renewable resources, ethanol blends also contribute to the battle against global warming.

U.S. Environmental Protection Agency Announces Plan to Phase Out MTBE

On March 20, 2000, the U.S. EPA announced major new actions to reduce or eliminate use of the fuel additive MTBE and boost the use of safer, renewable alternatives like ethanol. The plan addresses concerns over MTBE in groundwater while preserving the clean air benefits offered by gasoline oxygenates, and promoting greater production and use of renewable fuels.

"Threats posed by MTBE to water supplies in many areas of the country are a growing concern," said U.S. EPA Administrator Carol Browner. "Action by Congress is the fastest and best way to address this problem. We need to begin now to eliminate MTBE and move to safer alternatives, like ethanol because Americans deserve both clean air and clean water - and never one at the expense of the other".

The legislative framework, released by Browner and U.S. Agriculture Secretary Dan Glickman, is being sent to Congress and includes the following three recommendations:
°Amending the Clean Air Act to significantly reduce or eliminate the use of MTBE, in order to protect drinking water supplies;
°Ensuring that air quality gains are not diminished as MTBE use is reduced or eliminated;
°Replacing the existing oxygenate requirement in the Clean Air Act with a renewable fuel standard for all gasoline.

Ethanol Reduces Greenhouse Gas Emissions
Recent studies commissioned by Agriculture and Agri-Food Canada determined that 10% ethanol blends derived from corn in southern Ontario reduce greenhouse gases (GHGs) by 230,000 tonnes per year under current conditions. If the industry expanded to produce 1 billion litres of ethanol per year by 2010, the total GHG reductions will be 1.47 million tonnes of carbon dioxide equivalents, annually. This represents about 1% of the total GHG reduction required to meet Canada's commitment under the Kyoto Protocol, or 4% of the transportation sector's share of reductions. Ethanol produced from lignocellulose offers additional opportunities to reduce GHG emissions. If ethanol production can be expanded to 1.1 billion litres per year by 2010 in plants processing corn stover, wheat straw and switchgrass, the total GHG reductions will be 2.47 million tonnes, annually, representing 1.3 to 1.8% of Canada's commitment to the Kyoto Protocol.