## Bill In US Congress to Encourage Installation of Biofuel Station Infrastructure

##### 03 August 2008

US Representatives Herseth Sandlin (D-SD) and John Shimkus (R-IL) introduced bipartisan legislation—H.R.6734, The E85 and Biodiesel Access Act—that would streamline the process and provides greater incentives for service station owners to install equipment to dispense E85 and biodiesel.

The E85 and Biodiesel Access Act would enhance the Alternative Fuel Vehicle Refueling Property Credit. Currently, the Alternative Fuel Vehicle Refueling Property credit allows gas station owners to claim a 30% tax credit for the cost of installing clean-fuel vehicle refueling property up to a maximum of $30,000. Additionally, the IRS limits the credit to the amount a dual purpose fuel dispenser exceeds the cost of equivalent conventional refueling dispensers. This has not been sufficient to speed the broad deployment of biofuel dispensing infrastructure. The new legislation raises the amount of the credit from 30% of the cost of qualifying property to 50%, up to a maximum of$100,000, and allows station owners to claim the value for the entire cost of dual purpose fuel dispensers.

This legislation is supported by the American Coalition for Ethanol, the National Ethanol Vehicle Coalition, the Renewable Fuels Association, the National Association of Convenience Stores and the National Biodiesel Board.

Resources

FINALLY!!!!

Now if it can just get past all the Big Oil lobbyists and their puppets.

With one oil company reporting $11.6B quarterly net, you'd think these guys would want in on the next generation of liquid fuels. Hopefully this type legislation will be supported by greens AND new energy marketeers. There is plenty of money to be made in domestic liquid fuels - you'd think oil would be smart enough to invest in it. Before they appear to be an enemy of the people. A good piece of legislation - write your Congress-people to get them to support it. ------"Before they appear to be an enemy of the people."----------- ???????????????????? LMAO!!!!!!!!!!!!!!! To more than just the green freaks. Incentives for biofuel-dispensing equipment (but only for certain liquid biofuels), without any regard to the amount of such biofuels which can be produced without untoward impact on e.g. food prices and conservation easements, or consideration for gaseous biofuels or transportation energy from sources such as cogeneration. In other words, an E85 pump dispensing ethanol with a 1.5:1 EROEI would receive the tax credit, but a charger system for EV/PHEV cars using wind power with an EROEI of 25:1 would not. The fixation on liquids as the sole "alternative" fuels is madness. If I read this right, a fuel station that wants to put in a$50K island to sell gasoline from a 10000-gal tank can instead get a dual-fuel island that has the 10000-gal gasoline tank and a 500-gal ethanol one, and save themselves $25K courtesy Uncle Sam. This means that the subsidy money (or patience for it) will be exhausted on arbitrary stations, and not those that expect to sell a lot of alternative fuel. Which hits me with deja vu, recalling the Alternative Fuel Vehicle debacle in Arizona in 2000--too sweet a deal with no lock-in to the nominal purposes of the program. I.e., ripe for abuse. It ended up giving AFV's a bad name that helped set back the program (and set the stage for the oil dependence/cost crisis we are in now). What I fear happens is that the legislators don't write these bills because they already have a full-time job campaigning. So the lobbyists write the bills, and come up with a chutzpah initial bargaining position expecting to get half a loaf in the compromising. But energy politics is so polarized that they're going to either get what they asked for or nothing. The bill finally reaches the threshold of passing only with the help of votes from cynical supporters of Big Oil's status quo (meaning windfall times) who will happily set up their political competitors' favorite reform program for a fall. Because of that, the law will indeed get past "the Big Oil Lobbyists and their puppets"--knowing that the desire for reform is probably unstoppable any other way, this is how they want it. A more reasonable law would retain some dependence, for the station owner to see a profit, on actually selling a meaningful amount of alternative fuel. Or making the case that he is ready, willing and able to do so once the cars arrive and he is in one of the better places to start the ball rolling, where the government's investment stands to pay off. E85 in particular should have a rollout that is concentrated in certain regions initially, so that investments in E85-capable, and especially E85-optimized, vehicles will pay off. It is only the E85-optimized ones that will save consumers money without subsidies (since the ethanol price will rise to its energy-equivalent value in gasoline, so you need to exploit its higher octane advantage), but nobody will buy one if there's no place where a large percentage of the fuel stations carry E85. Some areas will give better smog benefits with E85 than others too. This bill doesn't help these matters. Another complication is that the fuel stations are mostly owned by oil companies; what's to stop them from begrudgingly carrying the farmers' product but putting a chutzpah price on it, happily promoting the meme that E85 is a bum deal? If the government is going to hand over$20-50K for a dual-fuel pump, that should buy it some say in the relative margins taken on the two fuels from there for some time (if you make 1% on the fossil gas, you shouldn't mark up the renewable more).

The first E85-optimized cars, BTW, should be PHEV's because the engine is smaller so it's easier and because you already found a customer who cares. Plus if you're having trouble getting E85 you can always plug it in.

You have some good points. If we were a marketing class.

Your point about the tank capacity seems pretty valid. However, when you pull up to a pump to put gas into your car---do you worry about what size storage tank the gas is coming from? I don't. Only the station owner does. He has to fill smaller tanks more often. Extra work. It doesn't make sense for a station owner to install a very large tank right off the bat. What if he cann't sell enough biofuel to warrant the expense? Better to put in a small one first and see how it goes. So he puts in the small one. Then lots and lots of people start switching from gasoline to ethanol. Ok, great, need more ethanol space. Well, if people are buying ethanol, they aren't buying gasoline, got lots of room there. Switch tanks, sell ethanol from the large tank, sell gasoline from the small tank. I don't see a huge problem---a little down time to clean the large tank,before you can switch to ethanol(petroleum leaves sludges and varnishes)---nothing to do to switch gasoline to the small tank, when ethanol runs out, just fill it with petro. This is a totally different scene if we are talking about a completely seperate system like hydrogen, electric, natural gas or some other type of fuel. If no one buys that fuel, the entire system is wasted. If a station owner puts in a small storage tank for ethanol because he doesn't know yet if anyone will buy it--he has less risk. If it takes off and sells well, since it is compatible with liquid delivery, he can just switch tanks.

Your point about the concentrated market introduction. I sort of agree with you if we were talking about a product that was say large and non mobile. Living room couches for instance. We would select a few markets to introduce it into and test sales before we go to the expense of a national marketing plan. We have already done that to a certain extent. Those markets where it is available and true market conditions exist ethanol sells well. I use it myself. As you point out, people need Flex Fuel cars to use it. Automakers do not compete to sell flex fuel cars at the moment because most people cann't get it. Flex Fuel production is reserved to areas it available, mainly the midwest. As ethanol is available more widely, car manufacturers will widen competition with flex fuel models--it costs them very little to make the change. In this case, we have to have the eggs before the chickens. Besides, there are about 8 million flex fuel cars on the road now, and unlike the couches, they are mobile--they go to different areas. I see no reason for the government to control availabiliy--either telling station owners they cann't put it in or they have to put it in. Just let normal market forces dictate where it goes, the station owners will know what they can sell and what they cann't, let them decide. If their customers what ethanol, they'll figure it out.

Oil companies are in business to make money. If they are making more money by marking up renewables in preference to fossil fuels, then they will do it. Up to a point. FF are expensive and getting more expensive. The price of crude has gone down a little lately, but at $140/brl it cost$3.50 per gallon(before refining), the commodity price of ethanol is running about \$2.60(no refining). If oil companies install Bio and then bad mouth or demote or inflate the price of their product to promote the sale of a product that costs them more to produce, they won't be in business too long. Their customers will just go down the street to an independent who prices their bio to match the true market price. Oil will put itself out of business. Products can only be priced according to the price of what goes into them. You cann't sell silk purses at sow's ear prices for very long. Especially when two products do exactly the same thing. There still may be oil around for a long time to come, but it will continue to get more and more expensive, and ethanol will not, and probably go down in price. Petroleum will sink to a small niche market of people willing to pay the price for it. Most people will switch to what works and costs less.

Car dealers do a lot of swapping back and forth to sell cars. Cars originally intended for the midwest market and made in flex fuel get swapped. A dealer in Kansas City orders a car, it comes in flex fuel, he has a customer come in who wants a green car---he finds a green car going to New Jersey. The car orders are swapped and the flex fuel goes to New Jersey. No one in New Jersey says or asks about it because there is no ethanol there. A customer in NJ buys the car and never looks under the hood or the owners manual. He just puts gas in and the car runs fine. He doesn't even know he has a flex fuel car. This is the situation in many cases. The more ethanol becomes available, the more it will be a marketing tool for automakers. I think eventually the automakers will just switch to all flex fuel by themselves. The cost in minimal, the assembly and supply lines are already geared up for production, and it will just be simpler for them to keep track of, one less thing to keep track of.

Dont bother with E85 just make the gas 15 Ethanol
on reg gas we would have to triple prodution and
not have to spend a dime on Infrastructure

@ EP:

Miscanthus EROEI = 5-8:1 (USDA) Replacing 20% domestic gasoline with miscanthus ethanol requires replanting 9.3% current U.S. agricultural acreage.

gr---about the same as switchgrass. Switchgrass is a native species that provides wildlife cover and food. It is approved cover grass by all state and federal wildlife and soil conservation districts. Areas planted in switchgrass can be managed game areas, soil conservation areas, praires, semi arid areas--and soil conservation problem areas.

Miscanthus is not seed bearing and not suitable forage. Planting miscanthus will destroy habitat areas for birds, deer, and a host of other animals. Please look at switchgrass instead---it has many more uses than miscanthus and would allow us multiple use of lands---for instance, managed wildlife areas could supplement management fees with switchgrass hay production from late season mowings---but skip mowing in early season when ground nesting birds are brooding and raising hatchlings. It is better to work WITH nature than against it.

Anon: good points - thank you. The USDA suggests that the 20% biofuel goal COULD be met without any expansion of current agricultural acreage except conversion (9.3%) to miscanthus. No wild or natural acreage would be tampered with.

Don't get me wrong gr, I'm not against miscanthus per se, however, switchgrass is a native species, wildlife has evolved to seek it as a source of food and cover. It is the approved and recommended type to use for wildlife and conservation purposes. If we use it we can make multiple use of lands. We can use it on managed wildlife areas, croplands that are left fallow to replenish, erosion areas, and we can STILL use it to make fuel. We'd be taking energy from lands that are not used now--AND we reduce costs by offsetting the costs of wildlife management, crop subsidies to support market price, and erosion control. Taxes saved there could buy other things. We'd simply be more efficient.

BTW---Blue Stem is another tall grass praire native species we could use. It is very similar to miscanthus in appearance but it is seed bearing, and wildlife make use of it since it is a native praire species, it makes excellent fodder and the huge herds of bufallo that once wandered the praires were what kept it in check. We need meat supplies that are reliable, and lean---and bufallo make excellent meat. They are hardier than domesticated cattle and survive harsh conditions much better. Blue Stem has a very deep root system evolved for the praire conditions. Blue Stem is drought and fire resistant unlike domesticated hays, and thrives in marginal conditions. I have friends that raise bufallo that are grazed on Blue Stem. It replenishes much more quickly and requires no irrigation.

Nature spent thousands of years developing grasses and plants specifically evolved to survive and even thrive on praire conditions. Man came along and thought HE knew better. Man was only fooling himself, as we are finding out now. Take a look at native species first---nature has had a LOT longer to work things out and is much more experienced than we are to know what is needed in the long run. We need to work WITH nature not against it if we want to survive.

Wetdog:

Thank you for your insights. I FULLY agree with you that working with nature is far better than against. This is the reason I advocate natural systems over man-made systems in most circumstances. I too have a friend who raises buffalo, in Missouri, although to my knowledge they graze entirely on native grasses and some local grown hay.

As a conservationist I am very interested in multiple-use crops. To that end Blue Stem sounds like a good path to trod.

You'll find the Shepherd Ranch in Clifton Hill a little north of Moberly planted in switchgrass and red clover.

Big Bluestems: The Big Bluestems were the best growing plants on the site. The Big
Bluestem plots have maintained themselves over the 6 years with very little decline. All Big
Bluestem varieties in the test were evaluated as Excellent or Good. The varieties rated
Excellent, in order from highest rating to lowest rating were: Rountree, SD-43 and Bonilla.
The varieties rating good, in order from highest rating to lowest rating, were: Bison, Pawnee,
and Niagra. By 1996 Kaw and Champ, which started in 1991 with excellent to good ratings,
had declined to fair. One set of native Big Bluestem plots was planted between 1993 and
1996, and was given an excellent rating in 1996.

Wisconsin is a tall grass praire area. Switchgrass and short blue stems do better in short grass praire areas like Nebraska.

In the old days, when crossing a tall grass praire, horsemen had to stop the horse and stand on it's back to see over the grass to find out where they were.

http://www.uwex.edu/ces/sars/crops/datagrass/Warm%20Season%20Grass%20Variety.pdf

Quoth gr:

Miscanthus EROEI = 5-8:1 (USDA) Replacing 20% domestic gasoline with miscanthus ethanol requires replanting 9.3% current U.S. agricultural acreage.
Notice the weasel-wording.  Why stop at 20%?  Let's see what it would take to replace 100%.

US gasoline consumption:  140 billion gallons/year
Ethanol equivalent:  ~200 billion gallons
Productivity of Miscanthus:  15 tons/ac/yr dry biomass
Ethanol productivity from e.g. Coskata process:  100 gallons/ton biomass
Acreage required to replace US gasoline consumption (assuming Illinois rainfall, soils, etc.):  133 million.

That's a lot more than the USA plants to corn.

We'd be better off using wind to power EV/PHEV cars and using biomass-fired CAES to cover the lulls.  1 dry ton of biomass (17.4 GJ) turned into 100 gallons of ethanol might power 2000 vehicle-miles of travel.  That same 17.4 GJ of biomass, used to reheat air in a CAES system (75% fuel-to-electric efficiency) would produce 3625 kWh; at 300 Wh/mile, you'd get about 12000 vehicle-miles out of it.

Using USDA and Montana State figures, managed timber stands need to be culled when saplings reach a hieght of 15-20 ft for optimal growth. Each tree of that size with have a trunk circumference of about 1 foot and yield about 1.6 tons of pulp. Depending on the microclimate and species culling yields about 2,000-3,000 trees per acre. All this plant material is for the most part just stacked up and burned to eliminate wildfire dangers and insect infestation. Using the current F-T yield of 70 gallons per acre, we are looking at a possible 140,000 to 210,000 gallons of ethanol per acre from a resource that is just stacked up and burned for the most part right now. 200,000 x 100,000 = 200 billion gal/yr 100,000 x 15 = 1.5 million acres to maintain a sustainable yield with an average of 15 year cull. We probably have more than that in managed timber stands now.

We can add culled timber to the totals. We currently produce 6 billion gallons/yr from corn. Sugar beets are about 8X as productive per acre as corn, planting sugar beets equal to 20% of the total corn crop would produce 48 billion gallons per year. Sugar cane is slightly more per acre as sugar beets.

Biodiesel is being produced right now from saltwater algae. Production rate is still low compared to possible, 4.4 million gallons per year on 1180 acres. Biodiesel replaces petroleum diesel gallon for gallon with no modification whatever. It can be used for trucks, diesel cars, and railroad locomotives, and marine diesels. It is also being tested for aviation jet fuel. We have LOTS of deserts and seawater available. And the remaining biomass could be used for feed for shrimp, crabs, or fish. No cropland needed.

Florida has a program going to turn citrus crop waste(mainly pulp and rinds left from juice making) and millions of tons of water plants that need to be dredged from drainage canals into ethanol.

Municipal garbage is 40%-50% cellusoe and there is a plant being built in Los Angeles area now to test garbage to ethanol production.

Spain right now produces 750 million liters/yr of ethanol from waste wood and has plans to double production in the next 2-3 years. Spain is Europe's leading producer of ethanol. Spain is smaller than California.

Kudzu vines are an invasive species in the southern US that can grow as much as 2 ft. per day. Most garderners would LOVE to see Kudzu vines incinerated to produce ethanol.

I don't think we'll have any problem at all finding MORE than enough feedstock to supply ALL of our energy needs from biofuels. Most of which is just stacked up and burned to get rid of it now.

wetdog, I'm going to ask you to provide cites for those numbers.  If the job was that easy (and even The Billion-Ton Vision didn't find anywhere close to that much biomass from forestry), we'd be doing it already.

Ditto kudzu.  If harvesting it was as easy as growing it, it would be the preferred raw material for a host of things including wood pellets for pellet stoves.

Just look around you. We have FAR more biomass available than we could ever possibly use.

And what isn't already accessible, we can make accessible by growing under controled conditions. That is what farming is.

Just because something isn't used now doesn't mean we cann't use it, it means it isn't used now. It isn't being used now because we haven't started using it. Right now it is just piled up and burned.[re; forestry culls, kudzu, canal dredging, crop waste, etc.]

Just look around you. We have FAR more biomass available than we could ever possibly use.
That's what they said 150 years ago, but it only took the rebuilding of Chicago after the fire to essentially denude Michigan.  We are a lot more energy-intensive now than we were then; Nate Hagens has calculated how long our forests would last if we used them to replace heating fuel, and the answer is about 2 years.

IIRC, the average capture efficiency of forest is on the order of 1 W/m^2.  If we round to 400 m^2/acre and assume 500 million acres available, that's a net capture of 200 GW.  US electric consumption averages ~460 GW, and US petroleum consumption of ~20 mmbbl/day is a whopping 1.4 terawatts.

E-P, if you would use the amount of time and energy thinking about what you CAN do instead of what you cann't do we'd all be a lot better off.

1) We don't have to replace our current usage. Our current usage is incredibly inefficient. It takes 1.23 gallons of crude oil to produce one gallon of gasoline. When you put 10 gallons of gas in your car's gas tank, you are actually consuming 22.3 gallons of crude oil.

That means that to do exactly the same things we only have to produce enough biofuels to equal less than half of crude oil consumption. Biodiesel is not produced from forests and that accounts for about 1/2 of oil consumption. So, we are down to needing only 1/4 of total oil consumption as ethanol, roughly 25%---but E-85 us 15% gasoline 1/7th, so 21%, plus we have many other sources to draw on to produce ethanol, corn, sugar cane, sugar beets, sorghum, milo, to name just a few. Use half crops and half wood and we only use each to replace about 10% of current energy needs. The more and varied the sources are, the less dependent we are on any given source and the more resistant the production system is to sudden catastrophic disaster.

Forests are denuded because they are not planted back. Forests that are replanted and culled properly regrow just like any other crop.

Up until now, the world's energy policy has been a "hunter gatherer" mentality. We hunt for and use up energy supplies. Well, the energy supplies are disappearing. It's getting harder and harder to hunt up new supplies, old supplies are running out, and we need more and more. Renewable, sustainable, "green", ecofriendly, whatever you want to call the new emerging technologies doesn't matter. What matters is that we can use them, and keep using them indefinitely by recycleing carbon, and making use of solar energy that renews each time the sun rises(wind is a form of solar energy, so is hydropower).

Society is as far as energy is concerned, is moving from "hunter gatherer" mentality to that of "domestication and farming". The same change that allowed man to move out of caves, live in cities and develop civilizations thousands of years ago when that same thinkng was applied to food supply. It was called farming and is the most fundamental development mankind ever made.

Quoth Wetdog:

if you would use the amount of time and energy thinking about what you CAN do instead of what you cann't do we'd all be a lot better off.
WTF are you talking about?  I've done that, at length.

Unfortunately, dealing with people touting snake-oil schemes that will give us Happy Motoring Forever (In Our Hummers) is a full-time job.  Those schemes WILL NOT WORK, though they will line various pockets (including those of the oil companies, which will have a near-monopoly for as long as it takes the public to finally get a clue).

I fear you're part of that public, because your arithmetic doesn't even add up.  One of the prerequisites for sorting out the diamonds from the gravel is Doing The Math.

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