Monday, June 30, 2008

FTC Ruling on Biodiesel and other Renewable Diesel Fuels

I came across a document that I thought was interesting. Rather than save to my desktop I figured this blog would be a better place to save the file.

The Federal Trade Commission promulgated a rule around the labeling and standard for biodiesel and "biomassed based diesels" (a description I have never formally heard referred to before).

Biomass-based Diesel Defined From the Rule Making:
Biomass-based diesel means a diesel fuel substitute produced from nonpetroleum renewable
resources that meets the registration requirements for fuels and fuel additives established by the Environmental Protection Agency under 42 U.S.C. 7545, and includes fuel derived from animal wastes, including poultry fats and poultry wastes, and other waste materials, or from municipal solid waste and sludges and oils derived from wastewater and the treatment of wastewater, except that the term does not include biodiesel as defined in this Part.


This is significant for two reasons. One, I never knew that the FTC had any part in the labeling or distribution of fuels. Second, this is the rule I recently saw mentioned by a PMAA newsletter about new biodiesel labeling requirements.

See the rule making here.

Wednesday, June 25, 2008

New ASTM Spec for Biodiesel

I heard about this first last week when my friend Nicola Davidson of the NW Biofuels Association called to tell me she voted on the subject and it passed.

A new better standard for biodiesel ASTM has come through. Now hopefully the Original Equipment Manufacturers (commonly refered to as OEM's in the indsutry) will finally embrace biodiesel.

The first official news story on the subject I've see came from Fleet Owner Magazine's e-news letter. See snippet below:

After five years of research and balloting, ASTM International D02 Main Committee has approved three sets of biodiesel specifications that alternative fuel advocates hope will generate increased automaker and consumer enthusiasm for biodiesel.

The approved specifications are: changes to the existing B100 biodiesel blend stock specification, finished specifications to include up to 5% biodiesel (B5) in the conventional petrodiesel specification, and a new specification for blends of between 6% biodiesel (B6) to 20% biodiesel (B20) for on- and off- road diesel.

Biogas - The Biggest Biofuel You've Never Heard About


I came across yet another story about gasification of garbage for electricity. It seems like these stories are multiplying in direct proportion with the falling US dollar and rising commodity prices.

It's funny. These days as diesel is predicted to move to over $6 and $200 a barrel crude is considered in many circles to be a safe bet not a speculation there is some real change in the market place. Here is the perfect storm that green-policy wonks have dreamed of and techno-futurist investors have bet on and the market is bouncing a little off the mark predicted.

What is fascinating is that in this world of higher prices we aren't seeing the biofuel media darlings (both loved and hated dependent on the story) ethanol and biodiesel. These two fuel plugging along with state leve RFS's, a Federal RFS, and a few voluntary adopters in the marketplace. But their roles seem defined by the mandatory blend policies.

The real technology move I'm seeing more and more of is biogas and syngas. At conferences, in press releases, and in passing conversation the new-new-thing seems to be bending compost heaps and exhaust gases to the wills of breakthrough technologies.

Taking several forms of technology I see this being the real paradigm shifting technology coming along. As agricultural operations of all sizes, utilities, and carbon off-set projects set their sights on these projects the technological applications, efficiency and proven return on these projects should put these in the mainstream of industry.

Of course mainstream in commercial applications puts this technology just outside the sexy-factor needed to get mentioned in political stump speeches. Either way, its exciting to see technologies like this come on strong.

For more on the subject check out Wikipedia's listings which are a good initial primer on the subject of what pops up under the energy slang word "Bio Gas":

Gasification
Syn Gas
Anaerobic Digestion

Monday, June 23, 2008

McCain Proposes Federal "X-Prize" for Electric Battery Powertrain Vehicles

John McCain goes all Portland, Oregon on the campaign trail. (See BizJournal for more info or JohnMcCain.com for the actual press release).

This seriously sounds like a left-coast proposal right along with the X-Prize for cars. The real question is why $300 million, why not other prizes, and what business does the Federal government have in offering a prize?

John McCain Will Propose A $300 Million Prize To Improve Battery Technology For Full Commercial Development Of Plug-In Hybrid And Full Electric Automobiles.
A $300 million prize should be awarded for the development of a battery package that has the size, capacity, cost and power to leapfrog the commercially available plug-in hybrids or electric cars. That battery should deliver a power source at 30 percent of the current costs. At $300 million, the prize is one dollar for every man, woman and child in this country -- and a small price to pay for breaking our dependence on oil.

I guess as long as it doesn't benefit a sitting special interest group John McCain can throw out pork with a straight face like the rest of them.

Having participated in a few government Request for Proposal (RFP) processes in the past I really don't see this making real sense in practice. Though on the stump it obviously has some real positive ring to it.

What I do like about it is the trust that if given incentive the free market will provide the solutions. Of course, when the Feds offer the prize instead of the free market it sorta destroys the logic of this effect though.

Congo uses Palm for Economic Development

The Republic of Congo plans to set aside part of its arable land for biofuel production. Congo has 8.2 million hectares of arable land, with less than 15 % of this land being cultivated. Three companies have asked for about 1.75 million hectares to plant palm trees for biodiesel.

Reported from the World Energy Global News Summary


Notice the 8.2 million hectares of farm land with under 15% in production. The interest in biofuels likely attracting foreign agricultural management, technology, and know-how to Congo. This is the first story of its type I've seen around Palm Oil. Usually its not called "arable land" but rain forest in a story.

We also see this in corn production in the US. With the additional market floor for ethanol it has given rise to more corn planted, harvested, exported, produced into food, and of course more ethanol. This side of the story is rarely discussed in stories about biofuels. Fortunately they don't call idle farm land in US set-aside "prarie" or "range land" when discussing using it to produce energy.

Usually the story pointing to any biofuel feedstock production assumes not a larger over all yield from a nation's resources but a zero-sum game as one of something means less of something else. Its to bad we don't see the truth about how the future of sustainable technology must focus not on cutting the pie in smaller pieces but instead a bigger pie with fewer inputs relative to the growing pieces.

That has been the past of the technology and should definitely be our focus for the future. There is also a large direct relationship between the wealth of a nation and its preservation of nature and environmental quality. No doubt a more productive Congo would be an overall greener Congo (though this is a very argumentive assertion on my part as many very green friends of mine have had this debate for years).

Thursday, June 19, 2008

Solar Power Compared to Standard Utility Cost

The Environmental Leader provides this easy to read chart on solar cost and expected utility rates.




The source for this information is a Utility Solar Assessment Study released recently by Clean Edge. (NOTE: I have not read the study yet)

Thursday, June 12, 2008

Major Automaker Listens to its Customers Wants. Toyota Rolls Out the Plug-In Hybrid


Hippies with six-figure incomes rejoice..... Your Christmas list has been written for you.

Shocking as it may be. Toyota is rolling out a plug-in hybrid. The retro-fits have long been popping around the Internet (Google having paid for retro-fits to show its viability). Well now its officially on its way.

Whats even better. Toyota is talking about the future with this vehicle. That future being a need to radically reduce the cost and ability of current lithium-ion batteries (see quote below).

"Reaching those goals will require bringing down the cost of lithium-ion batteries, which currently cost $1,000 per kilowatt hour, according to Tom Turrentine of the Plug-in Hybrid Electric Vehicle Research Center at UC-Davis."

Battery technology now entering the big-leagues when it comes to power-train Research and Development. This meaning that its official - the automobile's internal combustion engine is going through a totally new evolution.

See the full article at Wired.com

Wednesday, June 11, 2008

Gulf Oil CEO Speaks to Gasoline Retailers about Peak Oil

When a leader in the gasoline wholesale and retail business starts talking Peak oil it is a different world. See the article below.

A quote you don't see every day:

"While the company will not take on "green" fuels to save the planet, it will do so to gear up for a world beyond petroleum"

Mark the record books. $4 a gallon was the magic number for gasoline prices. The world began to talk completely different the moment gas hit that price.


From the Convenience Store News:
Gulf Oil CEO Reflects on Evolving Brand

During his keynote speech to Future Forum attendees, Gulf Oil President and CEO Joe Petrowski outlined his predictions for the energy industry, and why they have led the company to emphasize service and become more than just a petroleum distributor to its more than 2,500 retail partners.

"We have to, as an industry, prepare for a world without petroleum," he said, noting that the world is seeing a long-term structural shift in the energy market, which is resulting in the record prices for crude oil. On top of that, the world is running out of inexpensive oil.

"We do not have the technology today or access to cheap oil," he explained.Petrowski predicted high oil prices to continue, with a long-term floor of $60 to $70 a barrel, due to ethanol's growth from a boutique fuel. As a result, Gulf will be "fuel agnostic," meaning it will be both an ethanol and biodiesel player, along with regular petroleum-based fuels."We are creating an industry with options," said Petrowski.

"In the long term, ethanol will be a very viable choice."While the company will not take on "green" fuels to save the planet, it will do so to gear up for a world beyond petroleum, he said. "I'm not negating the need for green. There needs to be an economic drive to make changes. Convenience stores are not altruistic," he said, noting retailers' investment in alternative fuels will be hindered because of fluctuating margins and high credit card fees.

Petrowski also told attendees the distribution company is ensuring a secure future by trying to create healthy retailers.To do this, Gulf Oil is putting an emphasis on service, and providing its retail partners a "Gulf Sunrise" c-store concept, which aims to provide high margins inside the store, moving retailers away from surviving on fuel margins alone, he said.

Gulf will also provide retailers with pricing assistance, c-store and co-branding programs, construction/financing services, and loyalty programs and card services.

"Energy is not an end all, be all, but a means to have a better life," he concluded. —MB


Tuesday, June 10, 2008

Tuesday, June 3, 2008

T. Boone Pickens. Wind Power, Drinking Water, and the Future of Oil


If you don't know who T. Boone Pickens is you should. He is to the independent players in the petroleum industry what Robert Kennedy is to young liberals. The idealized figure, dubbed the "Oracle of Oil."

Much like Wall Street looks to Warren Buffet oil industry insiders all gossip about what T. Boone Pickens says, does, and what the future might hold. Fastcompany this month has a great interview with him. Definitely worth the read.

Fastcompany asks: "Texas tycoon T. Boone Pickens has been dubbed the "Oracle of Oil." So why is he building the world's largest wind farm?"

Monday, June 2, 2008

A Response to an Email

I sent out an email to a listserve with the link StopOilSpeculators.com which is an effort by gasoline retailers to shift the blame for gas prices to the derivative markets. To which I got a response which I answer below. I figured this was worth sharing.

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Kirk,

I did not invent financial derivatives or complex financial markets. Neither did the US. In fact I believe it was European traders starting with the exiled Scottsman John Law in France that first created financial markets.

High prices hurt. But they are good for progress. It is crushing many in the gasoline station business. Local companies that own one or two gas stations can't afford to own the gasoline in the ground (they can't afford to fill their tanks anymore than the suburbanites driving SUVs).

The fact that petroleum companies are pitting themselves against Wall-Street and big oil says alot about how this debate is going. Old time friends are throwing others under the bus. The debate is about to change in a big way and this is the first significant sign that the policy debate is now changed for good.

It looks like $130 a barrel oil and $4 gasoline was the magic number everyone speculated about. The world is changing.

I have a bachelors in petroleum economics, know alot about the subject. I understand enough to know that I don't understand how these systems work and personally believe anyone else associated with these large markets does either. Anymore than a poker player knows how to beat any other poker player

They are a living complex system similar to an ecosystem. They existed at the dawn of time and as humanity has scaled up so have these markets. They exist at all levels of society but only recently (last thirty years) have developed into the hypothetical exchanges that they really are at the commodity level.

Also - France, England, Japan, and many other nations have systems exactly the same as the US. Just smaller in scale with the size of the markets doing business in those economies. The existance of commodity exchanges is not the fault of the US, George W. Bush, petroleum hedgers, cattle drivers, or any other phenomenon. The fault of petroleum costs is the fault of everyone who buys it, trades it, or relies on it.

The fault of rising commodity prices is instablity in the US money markets due to mortgage backed securities having issues right now. Institutional investors (not speculators) moved to commodities which are easily convertable into dollars. The markets for agricultural goods (though large) are small in comparison to money markets and that is why many economists blame non-recieving buyers of commodities for the spike in commodities across the world.

The petroleum jobbers and retail gasoline retailers are spinning this to avoid blame for the high pump price.

Mark Fitz
www.DieselGeek.Blogspot.com

Sunday, June 1, 2008

Peak Oil Quote of the Day

The nice part about being a pessimist is that you are constantly being either proven right or pleasantly surprised.
- George F. Will

The above describes a friend of mine to a tee.Randy, a friend of mine from college, is a peak oil proponent. He lives, breathes, eats, and makes his income completely from the logic derived belief in Peak Oil and the End of Suburbia perspective.

As a sidenote: Randy's blog Lawns to Gardens