Ethanol

Green Plains Renewable Energy Inc. (GPRE) announced that its project in Shenandoah, Iowa is progressing as planned. The Company received its air permit from the Iowa Department of Natural Resources late last week. Fagen Inc. has set up their on-site construction offices and anticipates construction of the plant to begin early next week. The Company anticipates that the Shenandoah plant will begin producing ethanol in the Spring of 2007.

Debra Fiakas After a series of bankruptcies laid the U.S. ethanol industry on its back a few years ago, the survivors got the message  -  become economically viable or go out of business.  The industry has been scrambling to adopt new processes that utilize other non-food materials or at least get more out of the corn that has been the mainstay feedstock for the U.S. ethanol industry.   Enter Greenshift Corporation (GERS:  OTC/BB) with its corn oil extraction process and a new step in the corn-ethanol production process.  Greenshift may change the economics of corn-ethanol production by...

Jim Lane  Part II of II Cellulosic ethanol arrives at scale “The five years away forever” put to rest but are there troubling waters still ahead? For whom, and why? There’s a gigantic disconnect between two sections in the country as to whether the United States should be celebrating the success or the failure of cellulosic biofuels. Supporters and detractors alike saying that the wave of commercial-scale cellulosic ethanol refineries is a new wave in technology or the latest round in a wave of unimportant hype. We looked at the supporters, the detractors, the...

Dana Blankenhorn I am a big booster of alternative energy. Harvesting the wind, the Sun, the heat of the Earth, the tides – I'm there and NIMBYs be damned. But I am increasingly having second thoughts about one type of green energy. Corn-based ethanol. (I would toss in sugar cane, too, but America doesn't grow enough to matter here.) Corn ethanol was one of the first biofuels to find a market. Pushed by companies like Archer Daniels Midland (ADM) and Cargill, corn ethanol is now an integral ingredient in many blends of gasoline. It is...

Veridium Corp. (VRDM.OB) announced its receipt of an order from Ethanol Africa for the use of Veridium's patent-pending Corn Oil Extraction System(TM) at Ethanol Africa's new Bothaville, South Africa ethanol production facility. Veridium's proprietary new Corn Oil Extraction Systems(TM) extract high grade corn oil from an ethanol by-product called distillers dried grain ("DDG"). Veridium's technology has the capability of removing up to 75% of the corn oil from within the DDG in two stages. I have been finding more signs that this looks like its a real company and not just a shell to take advantage...

by Debra Fiakas CFA Ethanol producer Green Plains Renewable Energy, Inc. (GPRE:  Nasdaq) announced today plans to build a fuel terminal point in Beaumont, Texas.  The terminal will be located at a facility owned by Green Plains’ partner in the venture, Jefferson Gulf Coast Energy Partners.    It will be helpful to have a friend in the project that is expected to cost $55 million to complete just ethanol storage and throughput capacity.  Planned storage capacity is equivalent to 500,000 barrels, with the potential to expand to 1.0 million barrels.  Capacity to handle biofuels or other...

Romm v. Kholsa In a persuasive series of articles, entitled "Pragmatists vs. Environmentalists" (Parts I, II, and III) on Gristmill, Vinod Khosla provides the reasoning behind his "dissing" of plug-in hybrids, which drew the ire of Joeseph Romm.  Neither seems to think the argument is settled, and Joeseph Romm returns fire here. As someone who knows as much about investing as Joe Romm and has written as much about Climate Change and Energy Policy as Vinod Khosla, I feel the need to jump into the debate and settle the matter.  (Will either of them will notice?)...

The Great Ethanol Debate: Shoddy Economics all 'Round. Like many environmentalists, I'm not a big fan of the ethanol industry, especially corn ethanol.  From a net energy standpoint, even advocates agree that you only get a little more energy out than the energy you put in (Energy Return on Energy Invested or EROEI of 0.9 to 1.5, depending on whom you ask... some say it's much lower.)  At this point, most environmentalists simply decide that ethanol isn't sustainable enough for them, and go back to talking about photovoltaics (EROEI around 8, PDF) and wind (EREOI 30-70, PDF).  The last...

by Debra Fiakas CFA Green Plains Renewable Energy, Inc. (GPRE:  Nasdaq) is one of the few U.S. ethanol producers to turn a consistent profit.  The company is half way through its fifth consecutive profitable year.  Sales in the most recently reported twelve months totaled $3.4 billion, on which the company earned $40.5 million in net income.  During this period Green Plains generated $100.0 million in operating cash flow. Tracing Green Plains profits requires a bit of effort by investors.  The company channels its products through a marketing and distribution division.  Thus while, ethanol production...

by Debra Fiakas CFA The stark reality of basing their business model on a food commodity has been brought into sharp focus for ethanol producers.  The drought settling across the U.S. corn crop is helping drive up corn prices for hog producers, chicken farms and ethanol plants alike.  Investors who simply must have a position in ethanol might think the sugarcane-based ethanol producers could offer a safe haven against the supply and margin squeeze that is certain to hobble GreenPlains Renewable Energy (GPRE:  Nasdaq), Pacific Ethanol (PEIX:  Nasdaq) and Poet (private), among others relying on corn feedstock....

by Jim Lane It’s been a very busy week in Washington DC, the high point being a letter to seven senators sent late Thursday by EPA Administrator Scott Pruitt, who took significant (and as of a few days ago, unexpected) steps toward strengthening the foundation for ethanol and renewable fuels. The truth? It’s a Trump Administration back-down. EPA overreached on de-clawing the Renewable Fuel Standard on behalf on some grumpy oilpatch donors (known as GODs), and the Trump Administration managed to revive a Grand Alliance around renewable fuels — one that now includes almost 40 members of the United States Senate,...

Jim Lane In Nebraska, word has arrived from Green Plains (GPRE) that it will purchase the Madison, Ill., Mount Vernon, Ind. and York, Neb. ethanol facilities from Abengoa (ABGOY) Bioenergy with combined annual production capacity of 236 million gallons per year, for approximately $237 million in cash, plus certain working capital adjustments. The company said it was the successful bidder on three ethanol plants for sale conducted under the provisions of the U.S. Bankruptcy Code. Upon completion of the acquisitions, Green Plains will own and operate 17 dry mill ethanol facilities with combined production capacity of nearly 1.5...

The Future is Cellulosic It is now widely accepted that the future of ethanol is cellulosic: Rather than distilling corn for ethanol to fuel our cars, accepted wisdom is now that we will be able to replace a large fraction of our current fuel consumption with ethanol distilled from agricultural and forestry waste, as well as dedicated energy crops, such as switchgrass and hybrid poplar.  Cellulosic ethanol also has the potential to alleviate the greatest stumbling block of corn ethanol as a potential replacement of gasoline: that there is simply not enough of it.  Corn ethanol will only be...

by Debra Fiakas CFA The drumbeat of deals in the ethanol industry is sounding louder, or so it seems from the proliferation of notices in my e-mail inbox.  I received no less than four messages in one morning from ethanol producer Green Plains, Inc. (GPRE: Nasdaq) heralding the purchase of the Hopewell Ethanol plant in Virginia from FutureFuel, Inc. (FF:  NYSE).  The acquisition represents the ninth transaction for Green Plains in the last five years, adding another 60 million gallons in annual production capacity to Green Plains’ existing total capacity of 1.02 billion gallons.   Indeed, Green...