First there was peak oil, now we bring you peak ethanol.
Next we bring you peak wind?
http://www.jconline.com/article/20110110/NEWS/101100324/Purdue-researcher-Ethanol-has-peaked
"Eric Weddle jconline.com" said:
[b]Purdue researcher: Ethanol has peaked[/b]Has the use of ethanol in the U.S. reached its saturation point?
Yes, or says the conclusion of a Purdue University agricultural economics professor who has studied federal data about how ethanol is consumed and about the growth potential in the industry to meet an upcoming federal mandate for renewable fuel use.
Wally Tyner says developing next-generation biofuels, such as ones produced from algae or another biomass, is the only way to reach the mandate due to a lack of infrastructure in the U.S. for ethanol.
“You can produce bio-gasoline or green diesel as cellulosic fuels. You don’t have to produce ethanol,” Tyner said of fuels that still are in the development stage. “It goes right into the pipeline and can go right into the system and blend with the gasoline.”
But the owners of an ethanol plant in Linden, several miles south of Lafayette, say despite restrictions, increasing production of the mostly corn-based fuel is possible.
“Demand for regionally, refinery-made gasoline has peaked,” said Bill Day, spokesman for Valero Energy Corp. “Any increased demand for motor oil will be made with ethanol.”
Valero is the largest independent U.S. refiner. A year ago the San Antonio-based energy corporation purchased the Linden ethanol plant from VeraSun Energy Corp. The plant restarted production in September.
Tyner is not so sure VeraSun’s view is on the mark. At issue is meeting the federal renewable fuel standard. Tyner’s findings, co-authored with other researchers, were published in the December issue of the American Journal of Agricultural Economics.
The regulation requires an increase of renewable fuel production to 36 billion gallons per year by 2022. Up to this point, Tyner said, all the commercial gasoline-type biofuels are ethanol. Two different blends of ethanol are available in the U.S. – E10 and E85, meaning 10 percent ethanol and 85 percent ethanol, respectively.
According to Tyner, about 13 billion gallons of renewable fuel were required for 2010 and that the same amount he predicts the U.S. can handle through consumption and infrastructure.
Has the use of ethanol in the U.S. reached its saturation point?
Yes, or says the conclusion of a Purdue University agricultural economics professor who has studied federal data about how ethanol is consumed and about the growth potential in the industry to meet an upcoming federal mandate for renewable fuel use.
Wally Tyner says developing next-generation biofuels, such as ones produced from algae or another biomass, is the only way to reach the mandate due to a lack of infrastructure in the U.S. for ethanol.
“You can produce bio-gasoline or green diesel as cellulosic fuels. You don’t have to produce ethanol,” Tyner said of fuels that still are in the development stage. “It goes right into the pipeline and can go right into the system and blend with the gasoline.”
But the owners of an ethanol plant in Linden, several miles south of Lafayette, say despite restrictions, increasing production of the mostly corn-based fuel is possible.
“Demand for regionally, refinery-made gasoline has peaked,” said Bill Day, spokesman for Valero Energy Corp. “Any increased demand for motor oil will be made with ethanol.”
Valero is the largest independent U.S. refiner. A year ago the San Antonio-based energy corporation purchased the Linden ethanol plant from VeraSun Energy Corp. The plant restarted production in September.
Tyner is not so sure VeraSun’s view is on the mark. At issue is meeting the federal renewable fuel standard. Tyner’s findings, co-authored with other researchers, were published in the December issue of the American Journal of Agricultural Economics.
The regulation requires an increase of renewable fuel production to 36 billion gallons per year by 2022. Up to this point, Tyner said, all the commercial gasoline-type biofuels are ethanol. Two different blends of ethanol are available in the U.S. – E10 and E85, meaning 10 percent ethanol and 85 percent ethanol, respectively.
According to Tyner, about 13 billion gallons of renewable fuel were required for 2010 and that the same amount he predicts the U.S. can handle through consumption and infrastructure.
(2 of 2)Basically, he said, ethanol can’t make up the difference.
Tyner points out numerous reasons why ethanol is limited, such as it is required to be transported by rail or in tankers, unlike gasoline which has a distribution network through pipelines.
Tyner said the most striking reason is that there are about 2,000 fuel pumps out of 160,000 in the U.S. devoted to E85 – and it took 20 years to install them. In addition, Tyner said, E85 gets lower mileage than gasoline.
If gas was $3 per gallon at the pump, E85 would have to be $2.34 per gallon to break even on mileage, he said.
To increase E85 use, Valero is adding more fuel pumps for drivers.
“Valero owns about 1,000 retail sites in the U.S.,” Day said of fuel stations, mostly in the Southwest. “We are adding E85 pumps to service the demand for the flex-fuel issues.”
While that’s a small increase at first, Day said it will lead to more cars being able to fuel up with ethanol blends, thus increasing demand.
Day said Valero is confident ethanol use will increase, which is why it has purchased 10 plants, which can produce 1.2 billion gallons per year.
In Linden, the plant employs 65 people and operates 24 hours a day and has the capacity to produce 110 million gallons per year.
Day agreed with Tyner’s call for creating cellulosic fuels. Valero, he said, is putting money into that technology too.
“We have a lot of interest in that emerging technology, but the problem is they are emerging, not ready for now,” he said.
Following the discussionOne company that is following the ethanol discussion is Swift Enterprises, a renewable energy company at the Purdue Research Park in West Lafayette. In recent years the company has focused on developing a high-octane general aviation fuel that is biorenewable and nearing approval for the market.
Philip J. Catania, an aerospace engineer with the company, said Swift agrees the U.S. has reached, and possibly surpassed, the consumption threshold for ethanol, especially as the government has recently approved a gasoline blend with 15 percent ethanol.
“If you look in the owner’s manual for any vehicle out on the road these days, they state that ethanol over 10 percent in auto gas will void your warranty,” he said. “When we called one of the major U.S. auto manufacturers, we could not get anyone to give us an answer as to whether or not this would in fact void the warranty. Kind of troubling.”
Tyner and Day agree that the 15 percent blend is not the way to increase ethanol use, because it could only be used in cars made in 2007 or after.
Valero and other fuel station chains, including Marathon Oil Corp., said they will not sell E15.
For now, Swift is focusing on its aviation fuel and not something for the local pump.
“This is something we have started exploring, along with other fuels,” Catania said. “However, they are a very low priority, and as such will probably stay on the back burner until our aviation gasoline has hit the market.”
