Sketches of DuPont’s Cellulosic Ethanol Project in Nevada, Iowa
Jim Lane It towers above the surrounding Iowa countryside like the Launch Assembly Building lords it over Cape Canaveral it’s the new DuPont (DD) cellulosic ethanol project, on the outskirts of the town of Nevada. Functional yet inspiring, imposing yet accessible when it opens before year end 2014 it is sure to be a monumental addition to the cellulosic biofuels landscape. Last week we wrote: “There are strategic reasons to develop this new industrial bioscience business in central Iowa not just the “we’d love to have you, wages are low, cost of...
Earnings Roundup: Covanta, NFI Group, Green Plains Partners
by Tom Konrad, Ph.D., CFA
Earnings Season Continues
Below are three more updates on second quarter earnings which I've been sharing with my Patreon supporters. If you'd like to support my writing and see those thoughts in a more timely manner, consider becoming a patron. becoming a patron.
For everyone else, I'm reprinting those thoughts below.
Covanta Earnings
(published August 2nd)
Waste to energy company Covanta Holding Corp (CVA) saw most of its business recovering towards the end of the second quarter. Management is reluctant to predict if the positive trend will continue into the third quarter and for the rest of the year, but...
Enerkem’s $125M IPO: The 10-Minute Version
Jim Lane The second technology focused on unlocking value in municipal solid waste comes to the public markets. Here’s our 10-minute version of the filing, with a translation of the risks into English. In Canada, Enerkem has filed an F-1 registration statement for a proposed $125 million initial public offering. The number of shares to be offered in the proposed offering and the price range for the offering have not yet been determined. The lead book-running managers for the offering are Goldman Sachs, Credit Suisse and BMO Capital Markets. The company is currently ranked #7...
Ten Solid Clean Energy Companies to Buy on the Cheap: #7 Deere & Co....
The first and last word in any discussion of biofuels should always be "Feedstock." Feedstock is the "Bio" out of which biofuels will eventually be made, whether it be corn, sugar, jatropha, algae, palm oil, switchgrass, forestry waste, or municipal solid waste. Before the era of peak oil, we lived in a world of plenty, which meant that we could squander energy, not only by driving Hummers, but by feeding energy intensive products such as corn crops to livestock, and by dumping "free" sources of energy such as garden waste and used cooking oil into landfills. The era of...
Should Ethanol Subsidies be Renewed?
Jeff Coombe The Ethanol industry has only responded tepidly to the Volumetric Ethanol Excise Tax Credit in the past, so why should it be renewed? The U.S. ethanol industry is nearing a major deadline. The industry's primary subsidy mechanism, the Volumetric Ethanol Excise Tax Credit (VEETC), is set to expire on December 31, 2010. Federal ethanol subsidies were worth roughly $5 billion in 2009, a figure large enough to create vigorous debate over their renewal. Some call the credits a boondoggle, others a vitally important lifeline for an industry still in its formative years. ...
Dyadic International (DYAI.PK), A Stock To Avoid
Tom Konrad, Ph.D., CFA Dyadic International hopes to use proprietary gene discovery to revolutionize cellulosic biofuel and pharmaceuticals. Investors should stay away. Dyadic International (DYAI.PK) says they are applying their "proprietary enabling biotechnologies for multi-billion dollar markets in industrial enzymes, biofuels and biotherapeutics." A very exciting prospect, and just the sort of thing I've long warned investors to avoid. In short, they are a company with gigantic claims and not a lot of track record to back them up. Why I Care (I don't, really) In our survey of readers, one respondent asked that I write more about stocks...
A Decade Of Unexpected Curves In The Bioeconomy
By Jim Lane
Over the years we’ve all seen a lot of curveballs in the advanced bioeconomy. You see companies like Valero, which lobby the United States Congress with unbridled intensity to get rid of the Renewable Fuel Standard, on the verge of becoming the single-biggest producer of RINs in the United States (with news that they might take capacity at Diamond Green Diesel up to 540 million gallons).
You see companies like Solazyme which love the Renewable Fuel Standard and drive up to nearly a billion-dollar post-IPO valuation based on delivering fuels at volume, then announcing that there are even...
Solar Headwinds, Part I
How Solar PV is like Ethanol Tom Konrad, CFA High levels of competition in the the solar photovoltaic (PV) industry mean that buy-and-hold investors should look elsewhere. In May 2007, I published a competitive analysis of the corn Ethanol industry based on Michael Porter's classic Five Competitive Forces model. At the time, Ethanol stocks were flying high, but my conclusion was that "the prospective ethanol investor should be very careful about investing in corn ethanol producers at random." If anything, I understated the case. This chart shows three ethanol stocks that have survived since 2007. As...
10 Clean Energy Stocks for 2020: Updates on GPP, HASI, CVA
by Tom Konrad, Ph.D., CFA
Market Decline
Last week I warned "The risks in today's stock market outweigh the possibility of future potential gains." Looks like we're seeing those risks manifest in short order. The last couple days' decline have me looking at a few stocks to start adding to my positions again, especially MiX Telematics (MIXT) discussed on June 2nd and Green Plain Partners (GPP), discussed below.
Note that this pullback could easily be very early days of a much larger market decline. We might even see the market fall far enough to test the March lows... any of my buying...
Groundbreaking Set for Clymers Ethanol Plant
Andersons Inc. (ANDE) will conduct a groundbreaking ceremony April 27, 2006, at 11:30 a.m. for its 110 million gallon ethanol plant in Clymers, Indiana. When completed by the first quarter of 2007, the Clymers plant will be the largest of its kind east of the Mississippi River. Along with the 110 million gallons of ethanol, the plant will produce 350,000 tons of distillers dried grains, an animal feed ingredient.
An Insider’s Take on the Ethanol Industry
Biofuels: Panacea or Pandora's Box? Last night, I attended a talk in the Rocky Mountain Institute's "Quest for Solutions" lecture series titled "Biofuels: Panacea or Pandora's Box?" We were told that a video of the event will soon be up on RMI's website. Most of us were probably there to hear Amory Lovins speak, and no doubt most of the news coverage of the event will focus on him. Amory is a visionary as well as an engaging speaker, and Tom Foust of the National Renewable Energy Lab helped shed light on the science of biofuels, but for stock...
Novozymes Ignites Yeast Wars
Novozymes (Copenhagen:NZYM-B; OTC:NVZMY) moved into yeast this week with a new organism, Innova Drive.
It’s saccharomyces cerevisae — the workhouse yeast that has been powering wine fermentation since the days of Noah and the Ark. But here’s a new strain engineered to cut fermentation times up to two hours, and yield boosts of up to two percent.
A 2% yield increase and a 5% faster rate of production — let’s illustrate it — would mean something like 7.1 million gallons per year of more ethanol from the same standard 100 million gallon nameplate plant. Retailing at up to $10 million dollars, per year (yes,...
Veridium Receives Order from South African Ethanol Producer for Corn Oil Extraction Technology
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...
Advantage Biodiesel
By Tom Konrad, Ph.D., CFA
Because of rising fertilizer prices, farmers are planting more soybeans than corn. Soybeans are a legume, meaning that they can fix their own nitrogen in the soil, meaning that they need less nitrogen fertilizer, the price of which is spiking due to rising natural gas prices. Corn, in contrast, needs more nitrogen than most other crops.
High gas prices are rising because of Putin’s war on Ukraine, which is also preventing Ukrainian farmers from planting this year’s wheat crop, while sanctions are likely to disrupt wheat supplies from Russia as well.
Corn and (to a lesser extent,...
Ethanol and Biodiesel: Production Cost and Profitability
For a number of years, this (now old and outdated, but) very useful chart has been in circulation in energy circles, mapping the supply of energy to the world by looking not at prices, but at production costs. For one thing, it goes a long way to explaining why the price of oil can tumble so quickly when there is a fall off in demand, and explains why OPEC is troubled by unconventional oil in a way it is not so bothered by other energy sources such as renewable fuels. Renewables not only have been traditionally at the...
Aemetis’ Cellulosic Ethanol From Orchard Waste Project
by Jim Lane
There were more than 100 presentations at ABLC last week and not a clunker amongst them, but if I were to point the reader’s attention at one or two that stood out from the rest because of the short-term or long-term implications, I’d start with the news from Aemetis (AMTX) that they are embarking now on a $158 million cellulosic ethanol plant — to be built in Riverbank, California, in partnership with LanzaTech.
Cellulosic ethanol is selling for such a high price in California right now — the value jumps north of $4.00 per gallon at times —...
