FutureFuel: Still Future, Less Fuel

by Debra Fiakas CFA The last post “From Fuel to Fudge” discussed how the old Solazyme developer of algal-based renewable fuel has been transformed into a new company called TerraVia, (TVIA) which is pursing algal-based food and personal care products.  Solazyme is not the only renewable fuel company to make an about face.  Granted FutureFuel Corporation (FF:  NYSE) has not changed its name or stock symbol like Solazyme.  However, its ability to produce specialty chemicals has given FutureFuel an alternative to biofuels and its early plans to build a plant that could eventually produce 160 million gallons of...
Steve Hartiq

North American Outlook on Biofuels Challenges and Opportunities

Challenges and Opportunities in Biofuels By Steve Hartig, Former VP of Technology Development at ICM The North American biofuels market can be split into three main segments all of which have major dynamics.  What I would like to do is give a high-level overview of what I see as some of both the challenges and opportunities across these. Ethanol which is a produced from corn and sorghum in about 200 plants mainly across the Midwest and blended at about 10% with gas.  Majors such as POET, Green Plains, Flint Hills, Valero, ADM and Cargill do a bit more than half of the 16...

Renewable Energy Group Profits Exceed Subsidies

by Debra Fiakas CFA Earlier this month biodiesel producer Renewable Energy Group, Inc. (REGI:  Nasdaq) reported a tidy profit of $22.3 million on record $1.0 billion in total sales.  Reported net income was $43.5 million, including accounting treatments for corporate recapitalization undertaken in the year.  Results from 2012 were noteworthy on a couple of counts.  It was the first time in the company’s ten-year history (including years of operation among predecessor firms) that sales exceeded $1.0 billion.  REGI produced 188 million gallons of biodiesel from a variety of feedstock, including non-edible corn oil, used...

Current Structure of the US Ethanol Industry “Problematic”, Says the IMF

The International Monetary Fund released its Spring 2007 World Economic Forecast today. Fuel Vs. Food There is a short sub-section in Appendix 1.1 ("Recent Developments in Commodity Markets") that I thought might be worth sharing with you. If you download the PDF version of the report and scroll down to page 44, you will find the said sub-section under the heading "Food and Biofuels". In it, the IMF notes that food prices (as measured by its own food price index) rose by 10% in 2006, driven partly by a poor wheat crop in certain countries but...
Neste renewable diesel

Neste Sells 1 Billionth Gallon of Renewable Diesel

Neste reaches 1B gallons renewable diesel sale, runs in fire trucks, ambulances and school vehicles In Texas, Neste U.S., Inc. (NEF.F, NESTE.HE, NTOIF, NTOIY) is celebrating its 1 billionth gallon of Neste MY Renewable Diesel sold in North America which has effectively helped reduce more than seven million metric tons of greenhouse gas emissions in the Earth’s atmosphere. This is the equivalent of removing 1.6 million passenger vehicles from the road for one year. “There’s never been a better time to take a closer look at the steps we’re taking to ensure we’re leaving our planet in a healthier state for future generations,”...
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Rapidly Growing Alternative Energy Companies

The last post highlighted several companies in the alternative energy, conservation and environment technology fields that have delivered exceptional price performance over the last year.  Prospects for growth in sales or earnings appeared to be key drivers of the price movement.  It makes sense to seek indicators of growth as cues for those companies that may become tomorrow’s price movers. Crystal Equity Research’s novel alternative energy indices were a good place to go on a ‘quest for growth.’ Beach Boys Index  -  Biodiesel The two analysts who publish estimates for Renewable Energy Group (REGI:  Nasdaq)apparently expect a surge in growth in the current year followed by a leveling...

Green Diesel At Scale

Jim Lane A now-complete 142 million gallon green diesel monster project will easily deliver big on renewable energy targets and greenhouse gas emissions reduction. But it also offers a material path to profits for its parents, Valero Energy and Darling International. In Louisiana, Darling International (DAR) announced that Diamond Green Diesel, the joint venture between Valero (VLO) subsidiary Diamond Alternative Energy LLC and Darling International , has reached mechanical completion and the startup process will lead to full production of renewable diesel. Once in full operations, the 9,300 barrel-per-day (142.5 million gallon) plant in Norco,...

A (nearly) Pure-play Biodiesel Stock

On January 29th, M~Wave and private vertically integrated Biodiesel distributor Blue Sun Biodiesel announced a merger between the two, with Blue Sun becoming a division of M~Wave, and the merged company being renamed Blue Sun Holdings. Managerial control will also pass to "certain directors and the officers of SunFuels." If this merger goes through as planned in the second quarter of 2007, US investors will have their first opportunity to invest in a stock focused on a biofuel which is much less controversial among environmentalists than corn-based ethanol. Estimates of the well-to-wheels Energy Return on Energy Invested...
To Renewable Diesel

Conversions To Renewable Diesel

by Helena Tavares Kennedy The seasons are changing in many parts of the world right now, but what really is changing this autumn is how the world is looking at renewable diesel. Phillips 66 and REG’s announcement about a new renewable diesel plant on the U.S. West Coast planned for 2021 comes after a notable increase in refineries that are being converted and changed over to renewable diesel. Change is good, especially in this case. As Bob Dylan sang, “For the loser now, Will be later to win, For the times they are a-changin’.” And who knew he was singing about the RFS...
Diamond Green Diesel

Darling’s Renewable Diesel Diamond

In July 2013, Darling Ingredients (DAR:  NYSE) and its joint venture partner Valero Energy (VLO:  NYSE) commissioned the largest facility in North America to convert waste animal fats into renewable diesel.  The facility was strategic located adjacent to Valero’s petroleum refining installation in Norco, Louisiana. At the time the facility was capable of pumping out 12,000 barrels of renewable diesel per day that could be dropped directly into Valero’s distribution network and blended with fossil fuel.  Even at that production level the facility showed promise to deliver strong dividends back to its owners.  The partners named their venture Diamond Green Diesel and celebrated the unparalleled achievement. The two partners in Diamond Green...
CAFE LCFS CAA RFS braid

Low Carbon Fuel Rules: From CAFE to LCFS and Everything In Between

The Whole Darn Low Carbon Landscape. How they Work, How they Work Together, and How they Might Work Better by Joanne Ivancic, executive director, Advanced Biofuels USA The Trump Administration is taking a new look at Obama Administration era Co2 regulations.  On the transportation side, these include reviewing Corporate Average Fuel Economy (CAFE) standards; threatening to take away California’s authority to set their own mileage and pollution controls, including CO2 (carbon dioxide) emission reduction standards; and quarreling with the petroleum and biofuels industries over implementation and enforcement of the Renewable Fuel Standard (RFS). Thus, the Clean Air Act (CAA), California’s unique authority...

EPA increases US Renewable Fuel Standard Volumes, But Only Slightly

Jim Lane In Washington, the U.S. Environmental Protection Agency announced final volume requirements under the Renewable Fuel Standard program today for the years 2014, 2015 and 2016, and final volume requirements for biomass-based diesel for 2014 to 2017. This rule finalizes higher volumes of renewable fuel than the levels EPA proposed in June, boosting renewable production and providing support for robust, achievable growth of the biofuels industry. “The biofuel industry is an incredible American success story, and the RFS program has been an important driver of that successcutting carbon pollution, reducing our dependence on foreign oil, and sparking...

Biodiesel’s Nightmare: Renewable Diesel

Until algae farms move from the research and demonstration stage, biodiesel usage is going to be tightly constrained by available feedstock.  The feedstocks for biodiesel are oils and fats, which naturally occur in quantity only in animals or the seeds of plants.  As such, the quantity of oil available is much smaller than the sugars, starches, and cellulose which occur not only in the seeds and fruits of plants, but also in the stems and leaves, and can be used to make ethanol.  Because sugarcane contains the best ethanol feedstock, sugar in the stem (not just the...

FutureFuel’s Future

by Debra Fiakas CFA Last week the president of renewable chemicals producer FutureFuel Corporation (FF:  NYSE) turned in his resignation.  Lee Mikles is around sixty and seems a bit young for retirement.  He had been with the company from day one and served as the chief executive officer through the end of 2012.  He owns 2.3 million shares of FutureFuel stock or about 5% of the outstanding shares.  Maybe Mikles is just looking for a better paycheck.  The last time the company disclosed compensation, Mikles was down for $36,000 in compensation as a director.  Along with...

Hither and Yon: Transmission and Biofuels

In the most recent two installments of Energy Tech Stocks' interview with me cover my views on transmission stocks, and biofuel stocks.  Readers of AltEnergyStocks know that I am a big fan of electricity transmission, a theme I keep coming back to.  You also know that I have a very ambivalent relationship with both ethanol and biodiesel.  So I liked Bill's transmission article, but I just wasn't able to convey to him the subtleties of how I feel about biofuels.  But he got one thing right: the owners of biofuel feedstock are likely going to be the biggest winners....

FutureFuel, Present Buying Opportunity

Tom Konrad CFA FutureFuel Corp. (NYSE:FF) manufactures chemicals, biofuels (mostly biodiesel), and other biobased products.  About 60% of revenues have historically come from the Chemicals unit, with the balance of 40% coming from the Biodiesel unit. Both units saw sharp declines in revenues over the last two quarters for reasons that seem likely to be temporary (at least in part.)  The stock has sold off sharply as a result, falling from the $18-$21 range this spring to its $12 recent price Biodiesel The entire biodiesel industry has been suffering from the expiration of the biodiesel blender's tax...
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