Lots of new FlexFuels in 2009

I was just checking out the list of FlexFuel Vehicles (FFV) for model year 2009 and I have to give some big kudos to Chevy. Out of the 16 engine options they are offering, 13 are FFVs.

Vehicles that have FFV engines can use any ethanol blend of up to 85% ethanol, automatically adjusting engine timing to accomodate the fuel blend. Ethanol is much cleaner burning; a car running on E85 will decrease its Carbon Dioxide (CO2) emissions by about 41%. (This number takes into account the fact that there is less energy in a gallon of ethanol than in a gallon of pure gasoline, meaning you will use more ethanol to go the same distance.) 85% Ethanol is generally the cheapest fuel around; if you are an Oregon resident, you also qualify for a $0.50 / gallon tax credit!

Historically, most FFVs have not been labeled as such - especially if you drive an American made vehicle, you might have an FFV and not even know it. Check out a list of all FlexFuel Vehicles at http://www.e85fuel.com/e85101/flexfuelvehicles.php.

A list of all SeQuential E85 Ethanol pumps: http://www.sqbiofuels.com/locations.htm

More info on the Oregon Tax credit: http://www.sqbiofuels.com/tax_credit.html

20% ethanol for every gas car?

The Department of Energy released a report today with their initial findings on a project to identify the effects of higher blends of ethanol in engines not designed for the fuel.

Vehicle results include the following when E15 and E20 were compared with traditional gasoline:

• Tailpipe emissions were similar;
• Under normal operations, catalyst temperatures in the 13 cars were largely unchanged;
• When tested under full-throttle conditions, about half of the cars exhibited slightly increased catalyst temperatures with E15 and E20, compared to traditional gasoline; and,
• Based on informal observations during testing, drivability was unchanged.

It is a little confusing that tailpipe emissions were similar. From research I've seen, 10% Ethanol blended in with gasoline decrease carbon dioxide (CO2) emissions by about 5%. E85 Flex Fuel (85% ethanol) decreases CO2 by about 41%.

It will be interesting to see where this research leads - bringing more ethanol into the fuel supply would decrease overall mileage, but it would decrease dependence on foreign oil as well.

US Department of Energy: Biofuels Lower Gas Prices

The US DOE went on the defense for biofuels in a press release last week. They tackled one of the hottest topics of today - price - but from a different perspective, the effect of biofuels on the price of petroleum. You can read the whole release here.

The release states that in the US for 2008, biofuels will have displaced the use of 5% of all petroleum.

This 5% decrease in demand amounts to a $0.20 to $0.35 reduction in price at the pump for petroleum products.

The report also stresses that this is the impact of "first generation" biofuels. Second generation technologies, like cellulosic-ethanol and algae-biodiesel, are much more energy efficient, which translates to increased volume at lower costs.

Other good quotes from the release:

Today’s Biofuels Account for Only a Small Percentage of the Increase in Global Food Prices.

Higher oil and gas prices leading to increased costs of fertilizer, harvest, and transportation

Increased demand as developing countries grow and people improve their diets

Two years of bad weather and drought leading to poor harvests in parts of the world

Export restrictions imposed by some countries

Fuel Prices

I've gotten many questions on what goes into the price - as you all know, the price of both petroleum fuel and biofuel has been going up and up. (While writing this article, the price of a barrel of crude oil has hit $118.28, a price far higher than forecasted.)

SeQuential has received numerous inquiries to why this is happening, and like everything in the world, there are many factors that go into the equation. This is not meant to be a complete list, but an overview of some of the key influencers. Feel free to post any comments or questions!

Limited Supply
Without getting into a discussion on how much oil is left underground, there is a very real constraint on oil output: refinery capacity. Since 2004, refinery output worldwide has not increased.

Demand from Developing Countries
The demand for petroleum by developing countries, mainly China and India, has put a strain on the already limited supply of petroleum. Classic economics shows that when there is a supply-demand imbalance, prices raise.

Weak US Dollar
The US Dollar has been loosing value as compared to other world currencies. Since the US imports about 60% of its petroleum, the dollar is not able to buy as much petroleum as it used to.

Effect on Biofuel
Like it or not, the price of petroleum has an effect on absolutely everything in our lives, even the price of locally produced biofuel. Every day in Oregon, only 0.7% (0.007) of the total fuel used is biofuel. SeQuential sources products from companies that use biofuels as much as possible, but the reality is that most companies use petroleum fuel, tying us and our prices to the rises in the price of petroleum.

Effect on Food Prices
There have been many articles in the news as of late on how the growing use of biofuel has impacted the price of food worldwide. This is an issue that SeQuential takes very seriously; there is a wrong way and a right way to produce biofuels. Wherever possible, SeQuential uses recycled or locally grown products and the most efficient processes for fuel production.

Our sourcing principle:

• Best – regionally-produced from regionally-available feedstocks. Emphasis on waste products and recycled products.
• Better – regionally produced from domestically sourced feedstocks.
• Good – domestically produced from domestically sourced feedstocks.
• Unacceptable – biofuels that have a negative energy balance or are produced from imported feedstocks. (Brazilian soy or Malaysian palm oil.)

The effect of petroleum prices, currency imbalances, worldwide crop failures and growing demand of developing nations for meat (which requires large amounts of corn and other grains) has been largely overlooked. Given the relative small size of the biofuel industry, these other macroeconomic factors have a much larger influence. For more reading: NY Times.

SeQuential is committed to finding ways to avoid competing with food crops, such as using Used Cooking Oil or Canola and Camelina grown regionally in rotation with grass seed and other crops.

We are using how much fuel?!

I was going to do a different sort of analysis about this... but the scale of these numbers just wowed me so I'll let them speak for themselves.

Oregon's 2006 consumption of petroleum fuel:
4,314,400 gallons per day of gasoline (source)
2,266,600 gallons per day of diesel (source)

Oregon's 2006 consumption of biofuel:
38,356 gallons per day of ethanol (source)
10,959 gallons per day of biodiesel (source, which is a estimate)


Now with that in mind, how much of this is actually being produced in Oregon?

Oregon's 2006 production of petroleum fuel:
121 gallons per day of production capacity (source, I don't know if this is actually being produced)

Oregon's 2008 production of biofuel:
405,479 gallons per day of ethanol (source)
7,547 gallons per day of biodiesel (source)

So... what is the take away message here? Only a fraction of the fuel we use in Oregon is made from biofuel, but the impact has been huge:

• Bringing fuel production back in state
• Giving farmers access to a new market
  
• Decreasing carbon dioxide emissions
  
• Proving that not only is there an alternative to petroleum fuel, there are thousands of people who want this alternative

Everyone who has chosen to fuel up with biofuel is part of this change; we are still at the beginnings of it, but there is nowhere to go but up from here!

Register Guard Opinion Piece

The Register Guard just published an opinion piece by Ian Hill, a co-founder of SeQuential, in regards to recent articles about biofuels:

Oregon’s lower carbon biofuel industry

by Ian Hill

In response to recent articles claiming that the use of biofuel leads to increases in global warming, we would like to point out that not all biofuels are crated equal. The biodiesel and ethanol sold through our SeQuential retail station here in Eugene is some of the most sustainably-produced fuel currently available in the country.

The SeQuential-Pacific Biodiesel (SQPB) production plant in Salem uses recycled cooking oil from sources such as Kettle Foods, Burgerville etc. A small but growing percentage of the SQPB facility uses Oregon-grown canola oil that is grown as a rotational crop with wheat. Canola is typically grown one year in four to enhance soil quality, breaks up pest cycles and increases wheat yields. Other oilseed crops that can be grown on land not suitable for food production or in rotation with food crops are being currently researched by OSU.

It is important to note that the SQPB facility’s technology can efficiently produce quality biodiesel from a wide range of vegetable oils. This gives SQPB the ability to adapt to new sources of oil as they develop, such as certain types of algae which are the most efficient photo-synthetic producer of oil on the planet and can be grown using agricultural & municipal waste streams.

The majority of the ethanol that is sold through our retail station is sourced from Pacific Ethanol’s facility located in Boardman OR. This facility does use corn as its primary feedstock for producing ethanol. What makes this facility different is that they use ~30% less energy then most contemporary ethanol production facilities. They do this by selling most of their wet distiller grains (or WDGS the main by product of ethanol production) directly into a local livestock feed market.

Another item of interest about Pacific’s Boardman facility is that they recently received a Federal Department of Energy grant to build a pilot scale cellulose to ethanol production facility. This facility will focus on technology allowing the production of ethanol from local feed stocks such as wheat straw, corn stover & wood chips.

On a County level, there are a number of research projects underway that are looking at a variety of renewable energy sources. Such as anaerobic digestion utilizing food waste for energy production and pyrolysis technology for converting carbon based waste material into different forms of usable energy including liquid forms like butanol (a gasoline replacement).

These examples of Oregon-made biofuels are derived from raw materials that do not compete with food-producing acres. As a result, these biofuels reduce life cycle carbon emissions by 40 to 80 percent compared to standard petroleum-based fuels.

Oregon (and the Pacific Northwest) leads the nation with our use of high blends of biodiesel, specifically B99 (99.9% biodiesel). Oregon & Washington have the largest markets in the country for retail biodiesel. Government & business fleets in Oregon such as the City of Eugene, the City of Portland, Rexius, Sanipac, LTD and Tri-Met to name a few have proven that they are willing to vote with their fuel budgets to support Oregon made biofuel. This kind of support is critical to building a better, localized biofuel industry. From our municipal governments, to businesses with fleets, to the individual consumer the Northwest is leading the way in the development of a localized biofuel industry.

The work to build a localized, cleaner, sustainable energy economy is an important incremental step, not an overnight miracle. Our company is named SeQuential for this very reason. There is no single panacea to our current energy crisis. Rather we are faced with a diversity of solutions that must be pursued simultaneously. Conservation taking the form of higher efficiency diesel & gasoline vehicles, increasing the use of electric vehicles, greater use of public transit systems, riding bikes and walking are all solutions that must also be employed.

As a company we are committed to helping build an Oregon based, lower carbon biofuel industry that is cleaner burning and that supports our local economy. SeQuential can only do this in partnership with our customers.

Ian Hill is a Co-Founder of SeQuential Biofuels, an Oregon-based retail biofuels company that provides biofuel blends for every vehicle.

Not all biofuels are made the same

(This is a quick response to the New York Times article that came out today http://www.nytimes.com/2008/02/08/science/earth/08wbiofuels.htm)

As you know, not all biofuels are made the same; cutting down the rainforest to grow biofuel crops is a terrible idea. Growing crops locally has been proven thru many studies to create lowered emissions and a net gain of energy over the life cycle of the fuel. Life cycle assessments follow a product from "cradle to grave" and all the inputs in between; for biofuels, this would be taking everything from planting, to fertilizing, harvesting, transport, conversion, distribution and combustion, into consideration.

Soybean-based biodiesel (grown in the US) has a lifecycle impact of lowering carbon dioxide emissions by 78% as compared to petroleum diesel. (http://www.nrel.gov/docs/legosti/fy98/24089.pdf)

SeQuential has always relied upon government laboratory research; we feel it is the least biased source we can find. If you want to do some further reading, here is a page with a whole bunch of links to documents that support the benefits of biofuels: http://www1.eere.energy.gov/biomass/publications.html.

Most studies are done with Midwest grown soybean based biodiesel. The SeQuential-Pacific plant in Salem primarily makes biodiesel out of used cooking oil, adding the element of recycling into the mix. I have not seen any studies on how many times better this makes the environmental impact, but I imagine it is many-fold.