Alternative fuel under The Big Sky...
America’s latest fuel crisis exposes itself less in long lines at the pump and more as an ethical, political and economic question: When will each of us switch from black to green?
Personal reasons for using alternative fuels vary—topping the list include reducing human impact on the earth’s temperature, trimming dependence on foreign energy sources or disgust with the gluttony of consumerism—but most Americans agree that the time for biological-based energy has come.
Currently, about 72 percent of the energy used in the U.S. comes from oil and natural gas—that’s more than 25 percent of the total world consumption. Almost 60 percent of that oil is imported. Only 2 percent of the domestic energy used comes from plants.
But plants grow.
Experts expect them to produce more and more energy. They project U.S. biofuel production to grow to more than 16 billion gallons per year by 2015. Ethanol will account for 14.2 billion gallons of this total, increasing from 4.5 billion gallons in 2006. Then ethanol will equal just under 10 percent of projected total gasoline consumption. At a projected 2.15 billion gallons per year by 2015, biodiesel will equal approximately 4 percent of total estimated diesel consumption.
Montana is poised to help consumers make the switch from bubbling crude to green acres.
Big Sky Country’s cool, dry climate nurtures the oilseeds that are the foundation for biodiesel and the future of ethanol. Canola, camelina, rapeseed, and others provide an income incentive for Montana farmers and replenish the soil with nutrients for the state’s gold standard grains.
Yet, while the Big Sky prairies grow the base crop, refineries and retail outlets are few and far between. The expense of hauling oilseed to mid-west refineries eats up the financial and environmental benefits of growing the crop. Plant-based fuels will not reduce global warming if fossil fuel transports the crop long distances.
“Montana is the only state or province that does not have a wheat or barley-based ethanol plant in production,” says Peggy Beltrone, Cascade County commissioner and member of the 25 x ’25 steering committee.
The 25 x ‘25 Alliance hopes that by the year 2025, America’s farms, ranches and forests will provide 25 percent of the total energy consumed in the United States, while continuing to produce safe, abundant and affordable food, feed, and fiber. Producing 25 percent of America’s energy from renewable sources will increase farm income by $180 billion and generate $700 billion in new economic activity, create 4-5 million new jobs, reduce oil consumption by 2.5 million barrels per day and reduce carbon dioxide emissions by 1 billion tons.
The vision of 25 x ’25 has caught Congress’ attention.
Senator Max Baucus, a fourth-generation Montanan, supports legislation that would require that fuel blenders use 35 billion gallons of biofuels by 2022. This is only one example of Congress’ intent to reduce U.S. dependence on foreign oil, expand the development and use of biofuels and other alternative fuels; reduce the risks of global warming, diversify and build more secure, efficient and environmentally friendly energy supplies and technologies; reduce the burden of rising energy prices on consumers; eliminate tax “give aways” and prevent energy price manipulation. The Senate adopted those goals in the recent Senate Energy Bill. Beltrone expects the House to follow within a few months.
“Biodiesel doesn’t scale well—bigger plants are not more efficient. Montana is well-suited to have many small producers of biodiesel. We don’t have to transport the crop,” Beltrone says.
Bob Quinn, a Big Sandy farmer with a PhD in plant biochemistry agrees.
Quinn’s goal is to grow all of his farm fuel on 5 percent of his land. His oilseed press can crush two tons of seed every 24 hours. That 4,000 pounds will yield 160 gallons of biodiesel. At $3 per gallon, Quinn just avoided writing a $480 check.
“It’s not a huge return, but we have control,” he says.
Quinn hopes his neighbors will process their oilseed, too. He’s already talked to the local fuel distributor about delivering biodiesel to local customers.
“Bob’s model is a distributed model as opposed to a centralized model,” Beltrone says. “It fits Montana’s culture. We’re more self-reliant and set up to be locally owned and cooperative.”
Efficiencies Increase Energy
Many fossil fuel companies insist biofuel production is not sustainable because converting the sun’s energy to fuel uses more energy than it creates.
However, technology refutes that argument.
While federal tax incentives create profit for biodiesel and ethanol plants right now, efficiency is improving rapidly. Ethanol made from corn creates 67 percent more energy than the process uses to create it. Biodiesel’s energy return is more than 300 percent than the fossil-based energy used to produce it. Fully aware of “stealing” corn and soybeans that could feed the hungry to power SUVs, ethanol researchers are working to extract enough energy from grasses to provide a positive net energy.
Montanans will benefit from this research throughout the production-refinement-wholesale-retail chain. Corn and soybeans will not grow well throughout Montana because of the cool climate that favors grasses. With improved technology, local refineries will become more profitable and Montanans will have widespread access to green fuel. Finally.
A few entrepreneurs won’t wait for technology. Earl Fisher Biofuels, near Chester, produced 100,000 gallons of biodiesel this year with the eventual goal of a million gallons annually. In Shelby, an oilseed crusher is scheduled to be up and running by the end of 2007, with a biodiesel plant soon to follow in the same energy park. For now, the oil extracted from the crusher—about a third of the oilseed—will be shipped out of state for processing. Investors hope livestock producers will feed the rest.
Getting the fuel to the pump is still a challenge in Montana.
Across the 147,046 square miles of this vast state, Montana hosts 41 ethanol stations and eight biodiesel stations, says Shirley Ball, executive director of Ethanol Producers and Consumers (EPAC). Most gas stations do not offer biofuels simply because oil companies control fuel distribution lines.
Biofuels compete by lowering oil company profits so gas stations that are serviced by large oil companies are not allowed to offer biofuels.
“We have to improve the transportation network for biofuels,” says Baucus. “I’ve supported studies to develop pipeline and transportation networks for biofuels. Montanans are up to the challenge. Working together we’ll make sure that less of our transportation fuel comes from Saudi Arabia and more of it comes from Shelby.”
Follow the Money
While many people hold their environmental conscience close to their hearts, usually economics rule America’s buying habits. Consumers will fill their tanks with biofuel if plants provide cheaper fuel than dinosaurs.
The break-even price on ethanol and biodiesel is a moving target, depending on the cost of oil, steel, and other factors says Ball.
Montana’s Senator Max Baucus influences a few of Ball’s ‘other factors.’
As chair of the Senate Finance Committee, Baucus helped add Montana’s Cinderella crop, camelina, to the $1 per gallon biodiesel subsidy. He also worked to extend this and other biofuel supports another two years, to 2010. To encourage research in cellulosic ethanol, Baucus pushed for $1.11 per gallon credit for woody biomass and grass-based ethanol.
“This fuel can work for Montana, and I want to get it passed into law,” Baucus says. “The bottom line is that alternative energy can not only fuel our cars, and homes, they can also fuel our economy. The more alternative fuels we can make here at home, the more good-paying jobs we can create.”
And the more consumers can color themselves green.
The raw oil makes up 80 percent of the cost of biodiesel. Great Plains—The Camelina Company offers contracts to farmers for 9 cents per pound of camelina. This translates to $2.50 per gallon of biodiesel, after subtracting the $1 per gallon federal subsidy. As long as fossil-based diesel costs more than $2.50 a gallon and biodiesel purchases are convenient, consumers will probably make the switch. Even if the federal biofuels subsidy disappears, biodiesel will be economically viable when diesel costs $3.50. Once unheard of, now that possibility seems almost guaranteed.
Meeting the Challenge
No one denies the positive break-even of biodiesel when it is produced on a small scale. The limiting factor for biodiesel is consistency so air pollution is minimized. While biodiesel emits less pollution than conventional diesel, air pollution is still a concern.
Researchers at Montana State University-Northern at Havre host the latest equipment designed to test biodiesel and recommend procedures to maintain consistency.
“We’re testing additives, biodiesel from various oilseeds, and the effects of these fuels on engines,” says Greg Kegel, dean of the College of Technical Sciences at MSU-Northern.
“With ethanol, there’s a loss of power and there must be a significant change to the engine before it can burn ethanol. With biodiesel, I’d like it to be cheaper and have better emissions,” Kegel says.
And the Applied Technology Center at MSU-Northern has just begun certifying all Montana-produced biodiesel for performance and reliability. Each 10,000 gallon lot must be tested before it can be sold in the state. Kegel hopes the Environmental Protection Agency will soon allow ATC to certify biodiesel across the nation.
“This is what happens in America. Things will change quickly when there’s an incentive,” says Kegel.