Advanced Biofuel Industry Development Initiative Benefits Consumers, Farmers and Gas Station Owners with Localized “Field-to-Pump” Strategy

Baton Rouge, LA (October 20, 2008) – Governor Bobby Jindal has signed into law the Advanced Biofuel Industry Development Initiative, the most comprehensive and far-reaching state legislation in the nation enacted to develop a statewide advanced biofuel industry. Louisiana is the first state to enact alternative transportation fuel legislation that includes a variable blending pump pilot program and a hydrous ethanol pilot program.

Field-to-Pump Strategy
The legislature found that the proper development of an advanced biofuel industry in Louisiana requires implementation of the following comprehensive “field-to-pump” strategy developed by Renergie, Inc.:

(1) Feedstock Other Than Corn
(a) derived solely from Louisiana harvested crops;
(b) capable of an annual yield of at least 600 gallons of ethanol per acre;
(c) requiring no more than one-half of the water required to grow corn;
(d) tolerant to high temperature and waterlogging;
(e) resistant to drought and saline-alkaline soils;
(f) capable of being grown in marginal soils, ranging from heavy clay to light sand;
(g) requiring no more than one-third of the nitrogen required to grow corn, thereby reducing the risk of contamination of the waters of the state; and
(h) requiring no more than one-half of the energy necessary to convert corn into ethanol.

(2) Decentralized Network of Small Advanced Biofuel Manufacturing Facilities
Smaller is better. The distributed nature of a small advanced biofuel manufacturing facility network reduces feedstock supply risk, does not burden local water supplies and provides for broader based economic development. Each advanced biofuel manufacturing facility operating in Louisiana will produce no less than 5 million gallons of advanced biofuel per year and no more than 15 million gallons of advanced biofuel per year.

(3) Market Expansion
Advanced biofuel supply and demand shall be expanded beyond the 10% blend market by blending fuel-grade anhydrous ethanol with gasoline at the gas station pump. Variable blending pumps, directly installed and operated at local gas stations by a qualified small advanced biofuel manufacturing facility, shall offer the consumer a less expensive substitute for unleaded gasoline in the form of E10, E20, E30 and E85.

Pilot Programs
(1) Advanced Biofuel Variable Blending Pumps – The blending of fuels with advanced biofuel percentages between 10 percent and 85 percent will be permitted on a trial basis until January 1, 2012. During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the equipment used to dispense the ethanol blends to ascertain that the equipment is suitable and capable of producing an accurate measurement.

(2) Hydrous Ethanol – The use of hydrous ethanol blends of E10, E20, E30 and E85 in motor vehicles specifically selected for test purposes will be permitted on a trial basis until January 1, 2012. During this period the Louisiana Department of Agriculture and Forestry Division of Weights & Measures will monitor the performance of the motor vehicles. The hydrous blends will be tested for blend optimization with respect to fuel consumption and engine emissions. Preliminary tests conducted in Europe have proven that the use of hydrous ethanol, which eliminates the need for the hydrous-to-anhydrous dehydration processing step, results in an energy savings of between ten percent and forty-five percent during processing, a four percent product volume increase, higher mileage per gallon, a cleaner engine interior, and a reduction in greenhouse gas emissions.

Act No. 382, entitled “The Advanced Biofuel Industry Development Initiative,” was co-authored by 27 members of the Legislature. The original bill was drafted by Renergie, Inc. Representative Jonathan W. Perry (R – District 47), with the support of Senator Nick Gautreaux (D – District 26), was the primary author of the bill. Reflecting on the signing of Act No. 382 into law, Brian J. Donovan, CEO of Renergie, Inc. said, “I am pleased that the legislature and governor of the great State of Louisiana have chosen to lead the nation in moving ethanol beyond being just a blending component in gasoline to a fuel that is more economical, cleaner, renewable, and more efficient than unleaded gasoline. The two pilot programs, providing for an advanced biofuel variable blending pump trial and a hydrous ethanol trial, established by the State of Louisiana should be adopted by each and every state in our country.”

State Agencies Must Purchase or Lease Vehicles That Use Alternative Fuels
Louisiana’s Advanced Biofuel Industry Development Initiative further states, “The commissioner of administration shall not purchase or lease any motor vehicle for use by any state agency unless that vehicle is capable of and equipped for using an alternative fuel that results in lower emissions of oxides of nitrogen, volatile organic compounds, carbon monoxide, or particulates or any combination thereof that meet or exceed federal Clean Air Act standards.”

Advanced Biofuel Price Preference for State Agencies
Louisiana’s Advanced Biofuel Industry Development Initiative provides that a governmental body, state educational institution, or instrumentality of the state that performs essential governmental functions on a statewide or local basis is entitled to purchase E20, E30 or E85 advanced biofuel at a price equal to fifteen percent (15%) less per gallon than the price of unleaded gasoline for use in any motor vehicle.

Economic Benefits
The development of an advanced biofuel industry will help rebuild the local and regional economies devastated as a result of hurricanes Katrina and Rita by providing:
(1) increased value to the feedstock crops which will benefit local farmers and provide more revenue to the local community;
(2) increased investments in plants and equipment which will stimulate the local economy by providing construction jobs initially and the chance for full-time employment after the plant is completed;
(3) secondary employment as associated industries develop due to plant co-products becoming available at a competitive price; and
(4) increased local and state revenues collected from plant operations will stimulate local and state tax revenues and provide funds for improvements to the community and to the region.

“Representative Perry and Senator Gautreaux have worked tirelessly to craft comprehensive advanced biofuel legislation which will maximize rural development, benefit consumers, farmers and gas station owners while also protecting the environment and reducing the burden on local water supplies,” said Donovan. “Representative Perry, Senator Gautreaux, and Dr. Strain, Commissioner of the Louisiana Department of Agriculture and Forestry, should be praised for their leadership on this issue.”

About Renergie
Renergie was formed on March 22, 2006 for the purpose of raising capital to develop, construct, own and operate a network of ten ethanol plants in the parishes of the State of Louisiana which were devastated by hurricanes Katrina and Rita. Each ethanol plant will have a production capacity of five million gallons per year (5 MGY) of fuel-grade ethanol. Renergie’s “field-to-pump” strategy is to produce non-corn ethanol locally and directly market non-corn ethanol locally. On February 26, 2008, Renergie was one of 8 recipients, selected from 139 grant applicants, to share $12.5 million from the Florida Department of Environmental Protection’s Renewable Energy Technologies Grants Program. Renergie received $1,500,483 (partial funding) in grant money to design and build Florida’s first ethanol plant capable of producing fuel-grade ethanol solely from sweet sorghum juice. On April 2, 2008, Enterprise Florida, Inc., the state’s economic development organization, selected Renergie as one of Florida’s most innovative technology companies in the alternative energy sector. By blending fuel-grade ethanol with gasoline at the gas station pump, Renergie will offer the consumer a fuel that is more economical, cleaner, renewable, and more efficient than unleaded gasoline. Moreover, the Renergie project will mark the first time that Louisiana farmers will share in the profits realized from the sale of value-added products made from their crops.

Biofuel is a bright spot in our economy. Corn Belt states now have cheap fuel, expanding economies, and budget surpluses. Farmers and biofuel producers have worked hard to create an alternative liquid fuel system that replaces foreign oil. Biofuel industries are still evolving, and continuity is what we need, not abandonment. The biofuel industry is expending. Ethanol refineries are coming online in numerous other states: Texas, Louisiana, Florida, Arizona, Oklahoma, Georgia, New York, Pennsylvania, and California. Alternative feedstocks such as sorghum, organic waste, biomass and algae are being introduced. The State of Louisiana and Renergie are building a network of small, localized sweet sorghum ethanol plants, with a 5 to 1 return. Four sweet sorghum ethanol plants are being built in Florida. Subsidizing biofuels creates jobs, stimulates our economy, and generates County, State, and Federal tax revenue. Money back in your pocket. Every dollar spent on biofuel subsidies results in $10 in economic stimulus. So go figure.

The issue of ethanol subsidies is Not rooted in food prices. Overwhelmingly, the biggest factor in higher food prices is the higher cost of crude oil and transportation fuel, not biofuels, as John McCain falsely claims. Biofuel subsidies do not increase the price of food. If anything, they decrease food prices, because ethanol lowers the price of transportation fuel. Based on three different studies, blending ethanol with regular gasoline lowers the cost by 15%, and will save $30 to $50 Billion this year. We only spend $3 Billion on ethanol subsidies, better than a ten fold investment.

The new ethanol blender pumps will make a bigger impact, depending on who gets elected President. Typically, blending ethanol with gasoline is done in large quantities by oil companies or fuel distributors. Who ever does the blending gets the 51 cent per gallon tax credit subsidy. With the new onsite blender pumps, the retail gas station will get the tax credit. That changes everything. Retailers are expected to pass along most of the blending subsidy to the consumer. Thus, the various blends, E10, E20, E30, E40, E50, E85 will be about 30 to 50 cents a gallon cheaper at the blender pumps. Cheaper than ethanol already is. John McCain wants to discontinue the blending subsidy and take this discount away from you.

The American Petroleum Institute and the National Petrochemical and Refiner’s Association are challenging the North Carolina Blending Act in court. Big Oil is trying to prevent NC fuel retailers from blending ethanol and gasoline at the pump and taking-over the blending subsidy. If retail blender pumps prevail, the blending subsidy will be passed-on to consumers, and the oil industry will lose it. Ethanol blended at the pump will be much cheaper than gasoline. Blends might soon outsell gasoline, as is the trend in Iowa, Minnesota, Kansas, Nebraska and other ethanol producing states. In Minnesota, gasoline sales are down 9%, and ethanol sales are up 16%. Ethanol is chipping away at gasoline, and if the subsidy stays, ethanol blended at the pump will compete head-on with regular gasoline. This is why Big Oil wants the Republicans to get rid of the blending subsidy. They are threatened by the coming blender pumps which will give ethanol a significant price advantage.

The Republican Party receives huge campaign contributions from Big Oil and their intermediaries. John McCain’s battle cry is drill, drill, drill. But talk is cheap, because drilling now will only impact fuel prices moderately, 7 to 10 years from now.

The Republican platform also calls for eliminating the 54 cent per gallon import tariff on foreign ethanol. That would flood the market with imported ethanol and damage our domestic ethanol industry. The Republicans advocate that we should lessen our dependence on foreign oil by replacing it with a new dependence on Brazilian Ethanol. Importing Brazilian ethanol is Not going to fix our Trade Deficit, whereas producing more domestic biofuel will.

We pay for imported fuels and foreign oil with government bonds and debt instruments borrowed from the Federal Reserve. Every year, this is one of the things that is driving the National Debt higher and higher and forcing us to pay floating interest on imported oil and fuel.

By following John McCain, who wants to end the ethanol import tariff, we would flood the market with foreign ethanol, trade one dependency for another, drive up the Trade Deficit and the National Debt, and pay more revolving interest on imported fuel. Instead, we need to keep stimulating Domestic Biofuels.

Big Oil companies continue to make record breaking profits. So why do we continue to pay oil companies subsidies that are SIX TIMES higher than what we pay on biofuels? If John McCain wants to discontinue Biofuel subsidies, then he should also want to discontinue Petroleum subsidies. But, instead, he has fought to keep $40 Billion worth of annual subsidies to Big Oil intact. John McCain and the Republican Party are clearly aligned with their benefactor – The Oil Industry.

The GOP claims they want biofuels to float in a free market, without subsidies, yet they demand to keep the wealthy oil industry subsidized. John McCain’s stance on biofuels is a deceptive and hypocritical double standard, in the face of the American People.

McCain’s plan to end the Renewable Fuels Standard, end affordable biofuel subsidies, and end the ethanol import tariff would Disrupt a sector of our economy that is thriving. It would also cost you 40 to 50 cents a gallon at the pump. Domestic Biofuels are now a key component of our National Security. We need to carry out the bold and aggressive Biofuels Mandate that we already have in place. Disrupting it is poor judgment and NOT in our National Interest.

The Republican Deception is: Big Oil First. Not Country First.

PUBLISH FREELY

The best minds applied to the use of domestic CNG (compressed natural gas) are watching the Pickens Plan closely. Pickens speaks of CNG as a clean fuel "bridge" to more sustainable alternative resources. It buys us time. We will need everything (all sources) we've got and conservation to loosen the noose of foreign oil dependence. CNG in our diesel semi trucks and corporate truck fleets could reduce diesel consumption by 45% in less than five years. That would require only 1 million vehicles converting to CNG. It's doable. I drove a duel fuel CNG/diesel pickup truck this week and the technology is here, now! 20% more power using CNG/diesel blend, 40+ MPG, much lower emissions – conversion installation on large semi-truck coming in the next few weeks. Cool!

I blog about this and other Green topics at http://www.pilmerpr.com/blog

Get profesional help.

I had hope once that alternative could compete with $70 / barrel oil. That did not happen, even with $0.50 per gallon subsidies. I was surprised but I did not spend much time in denial.

The best course of action now is to develop our own resources which include offshore (and onshore) oil, coal, oil shale, oil sands, shale gas, nuclear and hydro – and to the small extent possible, wind, solar and biofuels.

When the alternatives compete then oil will disappear! So, what is your paranoia all about?