cellulosic ethenal report for yamhill county

Proposal for an Alternative Fuel Production Site

Yamhill County, Oregon Edition

T H E B U M P E R F U E L G R O U P

7 7 0 S W S c o t s m a n C o u r t , D u n d e e , O R 9 7 11 5 • Te l e p h o n e : 5 0 3 . 5 3 7 . 2 1 3 1 • w w w. B u m p e r F u e l . o r g

http://www.BumperFuel.org

http://www.BumperFuel.org

B u m p e r F u e l G r o u p P r o p o s a l f o r a n A l t e r n a t i v e F u e l P r o d u c t i o n S i t e

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About the Report

This report was prepared by Joshua Ferguson and Liz Marlia-Stein as concerned citi-zens of Yamhill County, Oregon. It is intended to offer information to our local officials about the benefits that a local cellulosic ethanol plant would provide. Our hope is for this report to be used as a reference tool, not only in Yamhill County but throughout the country and around the globe, to help curb mankind's dependency on oil.

Funded by Citizens of Yamhill County, Oregon

The efforts put forth through this report have been noticed by Yamhill County residents and business owners. These supporters, along with the authors of this report, have given money to ensure that the desired information is spread to local officials and busi-ness people throughout the state of Oregon.

Completed: January 2009. Published: February 2009.

Available by way of PDF file from the BumperFuel Group: [email protected]


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mailto:[email protected]

mailto:[email protected]

Acknowledgments

The authors wish to thank the following people for their contributions and support: Ramsey McPhillips, McPhillips Farm; Loren Berg, Loren Berg Chevrolet; McMinnville’s Lions Club; David Belyea with DEQ, State of Oregon; Repre-sentative David Wu, Oregon’s Congressional District 1; Senator Ron Wyden and staff, State of Oregon; Representative Jim Weidner, State Representative District 24; A1 Logging; Ian Hill, SeQuential Biofuels; Rigel Stone, BlueFire Fuels Inc.; Wes Bolsen, Coskata, Inc.; Matthew Glass, InEnTec LLC; Iogen Corporation; Waste Management; Clay Okabay-ashi, General Motors Corporation; Chad Roberson, OCE North America; and citizens of Yamhill County.

Dedications

This report is dedicated to the Ferguson and Marlia families.

Disclaimer

The information contained in this document includes statements of BumperFuel’s belief’s, expectations, hopes or intentions regarding the future. All forward thinking statements are made as of the date hereof and are based on the information to the BumperFuel Group as of such date. It is important to note that actual outcome and the actual re-sults could differ materially from those in such forward-looking statements. Factors that could cause actual results to differ materially include risks and uncertainties, such as technological, environmental, legislative, financial and mar-ketplace changes.

About BumperFuel

The BumperFuel Group is an alternative fuel advocacy alliance based in Yamhill County, Oregon. Out of our concern for the environment and improving our nation’s economy, we devoted ourselves to “next generation” energy re-search and promoting the establishment of a cellulosic ethanol plant in Yamhill County. By replacing landfills with “zero waste” and alternative energy systems, we hope to make Yamhill County a leader in the production of green fuel and power. BumperFuel’s ultimate goal is to reduce the county’s emission of greenhouse gas and use of foreign oil. The BumperFuel Group includes members representing the logging, farming, commerce, educational, political and environmental community.

Any reproduction of this document, in whole or in part, without the prior written consent of the BumperFuel Group is prohibited.

COPYRIGHT 2009, BumperFuel Group


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Table of Contents

Executive Summary 9

Purpose and Need 9

Financial Benefits 11

Background 13

History of Cellulosic Ethanol Production 13

Description of Cellulosic Ethanol Production 14

Benefits of Cellulosic Ethanol Over Other Energy Sources 17

Cellulosic Ethanol Versus Gasoline 18

Future of Cellulosic Ethanol 20

Impact of the Plant 23

Products Produced 23

Water Usage 24

Emission Output 24

Land Usage 26

Noise Pollution 28

Transportation Impact 28


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Feedstock Data 29

Logging Waste 29

Municipal Waste from Yamhill County 32

Municipal Waste From Other Counties 32

Expected Municipal Waste Increase 32

Sale of Ethanol 34

National Renewable Energy Laboratory 34

Renewable Fuels Association 34

SeQuential Biofuels 35

Requirements for Alternative Fuels 37

Federal 37

State 38

Alternative Fuel Production in Oregon 39

Lane County 39

Multnomah County 39

Marion County 39

Morrow County 41

Highlights of Cellulosic Ethanol Companies 43

Iogen Corporation 43

BlueFire Ethanol 45

InEnTec 51

Coskata 54


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Flexfuel Vehicles 58

General Motors 58

Ford Motor Company 58

Chrysler Limited Liability Partnership 59

Government Funding, Loans and Tax Credits 60

Federal 60

State of Oregon 63

Venture Capitalist Investment 65

State of Oregon Support 67

Yamhill County Support 68

How to Attract Alternative Fuel Companies 69

Conclusion 71

Attachments 74


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Executive Summary

Purpose and Need

The purpose of this report is to familiarize county officials about cellulosic ethanol and secure their support for establishing a plant in Yamhill County, Oregon. We will also document the many advantages of this alternative source of energy and explain why local investment would be a huge asset to our county.

The Natural Resources Defense Council (NRDC) issued a study in 2005 reporting that biofuels can “slash global warming emissions, improve air quality, reduce soil erosion, and expand wildlife habitat. Shifting to biofuels would bring tremendous benefits to America’s national security, economy, and environment.” NRDC believes that by the year 2050, biofuels could save U.S. citizens about $20 billion per year on fuel costs and virtually eliminate our demand for gasoline. Biofuels could reduce our country’s greenhouse emissions by 1.7 billion tons per year – equal to more than 80 percent of transportation-related emissions in 2002.1

Because of this study, and the foresight to recognize the need for alternative energy sources, Oregon’s Governor Ted Kulongoski established a coalition in 2005 exclaiming, “To meet the nation’s growing transportation fuel needs and reduce our vulnerability to imported oil, we must set an aggressive course of action to expand ethanol use and production.” This coalition is currently working with leaders in the fields of energy, ag-riculture, government research, and environment to determine a desired course of action.2

The U.S. Department of Energy states on their website, “Currently, biomass is the only clean, renewable energy source that can help to significantly diversify transportation fuels in the U.S. The Biomass Program is helping to transform the nation’s renewable


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1 Greene & Mugica, N. Y. (2005, July 2005). "Bringing Biofuels to the Pump." Retrieved January 12th, 2008, from www.nrdc.org/air/energy/pump/pump.pdf.

2 Governors' Ethanol Coalition (2005). Ethanol From Biomass, America's 21st Century Transporation Fuel Recom-mendations, Governors' Ethanol Coalition. 2008.

and abundant biomass resources into cost-competitive, high-performance biofuels, bio-products, and biopower.”3

For years, reporters, researchers, and ethanol-based groups have touted the benefits of cellulosic ethanol, stating that it is the “fuel of the future.” The future is upon us, and as research continues to progress, interest in using biofuels is “spreading like wildfire.” There is growing support to take waste and convert it into liquid fuel. Commercial-scale cellulosic ethanol plants are on the forefront of this growing industry. Just re-cently, Margaret Clark, Vice Chair of the Los Angeles County Solid Waste Management Committee/Integrated Waste Management Task Force and Council Member for the City of Rosemead, wrote a letter to the Board of Supervisors regarding the Task Force sup-porting the BlueFire cellulosic ethanol plant which is currently under construction in LA County. She told them that at this time, there are over 140 conversion-technology facilities that are successfully operating in Europe, Japan, and elsewhere, each using one of several processes—thermal, chemical, and biological.4 This trash-to-fuel process is already being used to fuel a variety of cars and trucks, and because the IEA (Interna-tional Energy Agency) expects oil to rebound to $100 plus per barrel and reach $200 per barrel by 2030, this is an opportune time to invest in cellulosic ethanol.5

McKinsey & Company consultants state that if the 2022 mandate is met for the 2008 En-ergy Bill, the ethanol industry, including the cellulosic ethanol producers, will have revenues of $50 billion to $70 billion dollars per year.6 Think of what this industry could do for Yamhill County. Merely working with cities in the county to set aside land


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3 U.S. Department of Energy. (2008). "Biomass Program." Retrieved December 18th, 2008, from http://www1.eere.energy.gov/biomass/.

4 Clark, M. (2008). Support for Bluefire Ethanol Project Conditional Use Permit Number 2007-00137. B. o. S. f. t. C. o. L. Angeles. Los Angeles, Margaret Clark. 2009: Letter to the Board of Supervisors of Los Angeles County from the Los Angeles County Solid Waste Management Committee/Integrated Waste Management Task Force for the support of the BlueFire Cellulosic plants. See attachment B

5 Associated Press. (2008). "Cost of crude seen rising to $200 by 2030." Tohes Global Retrieved December 11, 2008, from http://global.tohes.com/viewnews.asp?id=113.

6 Hodge, N. (2008, January 31st, 2008). "Cellulosic Ethanol companiees, New Hope for Biofuels." Green Chip Stocks Retrieved December 12th, 2008, from http://www.greenchipstocks.com/articles/cellulosic-ethanol-companies/205.

and attracting an existing company that is already looking to expand will get our county on the “bandwagon” and provide us with a share of this substantial revenue.

Financial Benefits

To justify the cost of converting to new technology, we must establish financial advan-tages. Cellulosic ethanol is estimated to save our country 1.5 million barrels of oil per day by 2022.7 It is also anticipated that by 2022, ethanol production will:8

• Add more than $1.7 trillion to our country’s GDP.

• Generate an additional $436 billion of household income.

• Create 1.1 million new jobs in all sectors of the economy.

• Add $209 billion in new federal tax receipts.

The U.S. Department of Commerce states, “When commercially viable cellulosic ethanol lowers U.S. fuel prices, the economic effects will be broad. U.S. Consumers will spend less disposable income on fuel and will have more to spend on other consumable items.” Crude oil-production would decrease by 1.8% as both demand and price lower. Not only would we see decreases in demand for oil but reductions in U.S. dollar expen-ditures on imports. We could replace oil imports with domestic ethanol production, re-sulting in a stronger dollar and increased prices for U.S. exports.9

What will this do for Oregon? Currently, we spend $10 billion on energy, with 85% of the money leaving our state. Just imagine the increase in state revenues from which Oregon will benefit by investing in cellulosic ethanol plants throughout our state. Ore-gon will become a leader in alternative energy and have a sustainable-energy economy through its use of cellulosic ethanol. In 2007, Governor Kulongoski paved the way for


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7 Ibid. 7

8 Renewable Fuels Association. (2008). "Renewable Fuel Standards." Retrieved December 8th, 2008, from http://www.ethanolrfa.org/resource/standard/.

9 Osborne, S. (2007). Energy in 2020: Assessing the Economic Effects of Commercialization of Cellulosic Ethanol. Washington D.C., U.S. Department of Commerce, International Trade Administration.

our state’s energy independence when he signed the state of Oregon Proclamation on July 2, 2007.10 This report is designed to aid the Governor in reaching his goal of mak-ing Oregon the leader in emerging sustainable energy.


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10 Theodore R. Kulongoski, G. o. O. (2007, July 2nd, 2007). "State of Oregon Proclamation, Office of the Governor." Retrieved December 12th, 2008, from http://governor.oregon.gov/Gov/pdf/energymonth.pdf.

Background

History of Cellulosic Ethanol Production

In 1898, a scientist in Germany took wood and diluted acid to hydrolyze the cellulose to glucose and was able to produce 18 gallons of ethanol with one ton of waste.

During World War I, a plant was established in the United States that produced 25 gal-lons of ethanol. It was closed shortly after the war because of a drop in lumber produc-tion.

During World War II, the U.S. Government set aside funding to build a cellulosic plant in Springfield, Oregon. Startup problems kept it from opening. However, it did create additional research at the TVA’s Wilson Dam Facility, where the process was fine-tuned and became a benchmark for future facilities.

Studies did not resume again until the 1970s when oil shortages began to increase. These studies continue through today and have been conducted by our nation’s De-partment of Energy and Department of Agriculture.

During the ‘70’s, we witnessed the groundbreaking of the first commercial-scale cellu-losic ethanol biorefinery in the United States. This facility, near Soperton, Georgia, used leftover wood residues from timber harvesting to produce ethanol and realized that other plants would soon follow, employing a variety of technologies and feedstock.11

Iogen Corporation, a Canadian-based company, was the first company in North Amer-ica to build and operate a commercially viable plant. They sold fuel in the 90‘s mainly to their own government.12

In 2002, BlueFire Ethanol opened a small cellulosic ethanol plant in Izumi Japan. The plant converted municipal waste, tires, wood, and miscellaneous farm debris into etha-


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11 Wikipedia. (2008). "Cellulosic Ethanol - History." Retrieved December 5th, 2008, from http://en.wikipedia.org/wiki/Cellulosic_ethanol.

12 Iogen Corporation. (2008). "Iogen Corporation Facilities." Retrieved December 10th, 2009, from http://www.iogen.ca/company/facilities/index.html.

nol. The CEO of BlueFire Ethanol, Arnold Klann, states, “Since BlueFire technology has been in actual production for over four years in NEDO’s pilot plant in Japan, we are well beyond the research and development stage of our business plan.”13

Oregon’s first cellulosic ethanol plant, in Boardman, will be completed in 2009. This plant will utilize wheat straw, corn stover—the portion of the stalk that remains in the field after harvest, and poplar residuals to make ethanol.14

2007 statistics showed that a total of 426,248,940 gallons of ethanol was imported to the United States from Brazil (188,825,960 gallons), Jamaica (75,193,188 gallons), and El Sal-vador (73,280,595 gallons). Questions have begun to surface about whether we should continue importing the fuel or begin processing it, ourselves, on a larger scale.15

The race to make cellulosic ethanol has gone on for over 100 years. The contest is no longer about the ability to produce the fuel in a commercially viable plant, but instead about each company proving that their technology is better than their competitors.

Description of Cellulosic Ethanol Production

The production of cellulosic ethanol is similar to corn ethanol in that it takes a renew-able resource and converts it into fuel. The process begins with waste byproducts that come from municipal waste; industrial, logging, and farming waste; and grass seed or other organic and inorganic materials. There are various ways to process the feedstock; yet, Coskata, Inc.’s method has proven to be the most efficient. The feedstock is put into the gasification chamber where it is exposed to a plasma torch at 20,000º F, as hot as the surface of the sun. As clean gas leaves the reactor, sulfur is extracted and harvested for use in other products; halogen gases are collected for resale as well. The leftover “slag” is inert and sold as a useful product—ideal for use as bricks or highway material. From


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13 Bluefire Ethanol. (2006, July 19th 2006). "BlueFire Announces Plan for Rapid Development of Multiple Facilities." Retrieved October 23, 2008, from http://www.bluefireethanol.com/pr/4.

14 Pacific Ethanol. (2008, January 29th, 2008). "Pacific Ethanol Wins DOE Cellulosic Energy Grant." Retrieved January 25th, 2009, from http://www.pacificethanol.net/site/index.php/news/news_article/285/.


the gasification chamber, pure carbon-bearing gas flows into a reactor. Inside the reac-tor are specially bred microbes that consume the synthetic gas, or “syngas”, and con-verts it into 99.7% pure ethanol. The microbes that are used during the production process are nontoxic and biodegradable.16

As already described, feedstock can come from a variety of sources; even nonfood sources can be used. Industry experts and analysts are expecting paper and pulp com-panies like Domtar Corporation to start selling their byproducts to the cellulosic ethanol plants in the near future. Cellulosic ethanol is a much more versatile fuel to produce than corn since cellulosic ethanol plants can be developed in almost any area; corn ethanol plants, on the other hand, need to be built where corn is produced. The Cellu-losic Ethanol Industry expects that forest resources and corn stover will be the largest providers of feedstock.17


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16 Coskata Inc. (2008). "Frequently Asked Questions." Retrieved December 10th, 2008, from http://www.coskata.com/AboutFAQ.asp.

17 Curtis, B. (2008). 2007 Year in Review. U.S. Ethanol Industry: The Next Inflection Point. B. E. R. Group. San Fran-cisco, BCurtis Energies & Resource Group. 2008: BCurtis Energies & Resources Group 2007 review of the ethanol in-dustry.

Source: Coskata, Inc. Coskata conversion process, 2008, http://coskata.com/images/Thecoskataprocess_000.jpg. !


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http://coskata.com/images/Thecoskataprocess_000.jpg

http://coskata.com/images/Thecoskataprocess_000.jpg

Benefits of Cellulosic Ethanol Over Other Energy Sources

In 2004, the Department of Energy (DOE) set targets to have cellulosic ethanol produced at $1.07 a gallon by 2012 to make it price competitive with gasoline and corn-based ethanol. At $1.07 a gallon, cellulosic ethanol would be competitive with oil-barrel prices of $50.00 and gasoline sold at $1.60 a gallon. (Note: These figures are in 2004 dollars.) The DOE states that cellulosic ethanol has the potential of being produced for $0.33 a gallon if:18

• The cost of the enzymes is reduced to $0.05 a gallon from the current $0.40 a gallon.

• The cost of the feedstock decreases in price to $30.00 per ton. Note that by using “trash,” the estimated cost per ton is $0.00.

• The producer can increase the ethanol yield to 90 gallons of fuel per ton of feedstock from the average of 60 tons per yield.

The U.S. Department of Commerce predicts that if cellulosic ethanol reaches 49.5 billion gallons by 2020:18

• Domestic U.S. fuel prices would fall by 5.2%.

• World oil prices would decline by 3.1%.

• U.S. oil import would decline by 10.7% or by 1.2 million barrels per day.

• U.S agriculture would gain 54,000 jobs.

Another benefit of using cellulosic ethanol is the amount of water used in comparison to other energy sources. Water usage in the production process for cellulosic ethanol is less than one gallon of water versus three to eight gallons for other sources.19


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19 Renewable Fuels Association (2008). Changing the Climate, Ethanol Industry Outlook 2008. Washington, D.C., Re-newable Fuels Association.

Comparing the BTU (British Thermal Units) of using cellulosic ethanol in place of other energy sources, evidence shows that the BTU return for each BTU of fossil fuel used in production processes shows that cellulosic ethanol gives more than seven times the re-turn for the BTU input. This is a positive net energy balance, meaning that there is a greater energy return than the energy required to make it. The comparisons are as follows:20

• .45 BTU’s for electricity.

• .81 BTU’s for gasoline.

• .98 BTU’s for coal.

• .98 – 1.36 BTU’s for corn ethanol.

• 7.7 to 10.31 BTU’s for cellulosic ethanol.

Cellulosic Ethanol Versus Gasoline

When using cellulosic ethanol, there will be up to a 20% decrease in miles per gallon. However, mileage is not the only comparative factor that needs to be addressed. Cellu-losic ethanol emissions are decreased by up to 90%, and less energy is needed to pro-duce each gallon of ethanol.21 Therefore, comparing cellulosic ethanol with gasoline, more fuel will be needed from cellulosic ethanol to go a determined distance, yet overall emissions will be significantly reduced. Also, the energy to produce the extra fuel will use less BTUs than gasoline uses, resulting in a better use of energy compared to gaso-line.

According to this information, the use of cellulosic ethanol reduces oil consumption considerably. Over a distance of 100,000 miles, a Chevrolet HHR, using flexfuel, will


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20 Hostrand, D. (2007, July 2007). "Energy agriculture - ethanol energy balance." AgDM newsletter Retrieved Septem-ber 15th, 2008, from http://www.extension.iastate.edu/agdm/articles/hof/hofjuly07.html.

21 Coskata Inc. (2008). "Frequently Asked Questions." Retrieved December 10th, 2008, from http://www.coskata.com/AboutFAQ.asp.

use 20 barrels of oil less than a 2009 Toyota Prius, using gasoline, does. The HHR will also emit less than a quarter of the emissions of the Prius.22

Source: Wang et al. GHG emission comparison, May 22, 2007. Environmental Research Letters, Vol. 2, 024001


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22 Environmental Protection Agency. (2009). "Compare Side-by-Side." Retrieved December 8th, 2008, from http://www.fueleconomy.gov/feg/sbs.htm.

Future of Cellulosic Ethanol

According to a number of sources, the future of cellulosic ethanol is very encouraging. Here are just a few accounts:

• In 2007, Coskata, Inc. and other cellulosic ethanol companies, surpassed the 2012 goal of producing an ethanol yield of 90 gallons of fuel per ton of feedstock from the average of 60 tons a yield. Coskata’s return, at this point, is 100 gallons of fuel per ton of feedstock.23

• Feedstock, using the Coskata system, can come from 100% municipal waste, includ-ing paint, toxins and other hazardous material. The more cellulose that the material has, the lower the amount of left over “slag”. 100% municipal trash can result in as much as 30% slag, whereas wood from trees creates about 2% slag. Tires, plastic bot-tles, and construction waste are considered three of the better materials for feedstock.24

• Coskata, Inc. is teaming up with General Motors, and together they are working with the Chinese and Australian Governments to build trash-to-fuel plants in the two countries.25

• As of September 2008, 24 cellulosic ethanol sites are under development, construc-tion, or currently operating in 20 states, one of which is located in Boardman, Ore-gon. Six of these 24 plants utilize, or will utilize, municipal waste for their produc-tion method.26


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24 Bolsen, W. (2009). Coskata Process - Slag and feedstock. J. F.-B. Group. Warrenville, Wes Bolsen. See attachment A

25 General Motors. (2008, October 27th, 2008). "GM Studies Feasibility of Non-Food Based Biofuels Commercialization in China." Retrieved October 27th, 2008, from http://www.gm.com/corporate/responsibility/environment/news/2008/nonfood_102208.jsp.


• The U.S. Government set mandates of having 250 million gallons of cellulosic etha-nol produced by 2013.27

• Cellulosic ethanol is expected to be a $52.5 billion industry by 2015.28

• When including the fact that most manufacturers and municipalities pay to dispose of their refuse, Jeff Surma, the CEO and cofounder of InEnTec, formerly Integrated Environmental Technologies, LLC, states that it could cost between $0.10 to $0.95 per gallon to produce cellulosic ethanol from waste, depending on feedstock costs and enzyme use.29

• When the energy source of choice is hydrogen, ethanol will be there to make it hap-pen, as ethanol is a good processing fuel for on-board production of hydrogen.30

• Oregon’s United States Representative, David Wu, signed onto House Bill, H.R. 1424, which includes a tax credit to businesses that install alternative fuels like E85 and extends energy-production tax credits for businesses that produce cellulosic ethanol. In his letter to the writer of the bill, he states: “Tax incentives and infra-structure programs for green-economy initiatives are common sense and will di-rectly benefit this country’s movement toward an economy focused on producing new technologies and renewable energy production.”31

• A next-generation fuel is biobutanol. Like ethanol, biobutanol breaks down raw feedstock, such as municipal trash; but unlike ethanol, it is modified to have a longer chain of hydrocarbons, which allows it to mix well with water and be less corrosive.


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27 Ibid. 17

28 Lignol Energy Corporation. (2008, June 2008). "Cellulosic Ethanol - The Sustainable Fuel." Retrieved January 5th, 2009, from www.lignol.ca/files/08-Lignol-FS-v9-nobleed.pdf.

29 Bullis, K. (2007, January 19th, 2007). "Creating Ethanol from Trash." Retrieved November 11th, 2008, from http://www.technologyreview.com/energy/18084/.

30 Iogen Corporation. (2008). "FAQ Iogen Corporation " Retrieved December 10th, 2009, from http://www.iogen.ca/company/faq/index.html.

31 Wu, D. (2008). Alternative Energy Support. J. Ferguson. Portland, David Wu. See attachment I

The fuel can be stored easily and transported within the existing gasoline pipelines. Plans are underway to build plants to produce biobutanol by 2012. Companies, such as Cobalt Biofuels, Dupont, BlueFire, Gevo, and Tetravieae Bioscience are all interested.32 Locations for these plants have not yet been determined, which gives Yamhill County an opportunity to be a part of the forefront in fuel technology.

Source: U.S. Dept. of Energy. Biofuel project locations, 2008. http://www.energy.gov/media/ProjectLocations.pdf

Major DOE Biofuels Project LocationsGeographic, Feedstock, and Technology Diversity

Pacific Ethanol Biochemical Wheat Straw/Corn Stover (Boardman, OR)

IogenBiochemical Wheat Straw(Shelly, ID)

Blue FireBiochemicalMunicipal Solid Waste(Corona, CA)

PoetBiochemicalCorn Stover(Emmetsburg, IA)

LignolBiochemicalWood Residues(Commerce City, CO)

ICMBiochemicalSwitchgrass, Corn Stover(St. Joseph, MO)

AbengoaBiochemical/ThermoAg Waste, Switchgrass(Hugoton, KS)

DOE Joint Bioenergy Institute(Berkeley, CA)

DOE Great Lakes Bioenergy Research Center(Madison, WI)

DOE Bioenergy Science Center(Oak Ridge, TN)

Stora Enso North AmericaThermochemicalWood Chips(Wisconsin Rapids, WI)

Range FuelsThermochemicalWood Chips(Soperton, GA)

AlicoThermochemical/BioCitrus Waste(LaBelle, FL)Six Commercial-Scale Biorefinergy Projects: up to $385 million

Seven Small-Scale (10%) Biorefinery Projects: up to $114 million (first round)

Three Bioenergy Centers: up to $405 million

Four Thermochemical Biofuels Projects: up to $7.7 million

Four Improved Enzyme Projects: up to $33.8 million

Five Projects for Advanced Ethanol Conversion Organisms: up to $23 million

Iowa StateThermochemicalSwitchgrass(Ames, IA)

Emery EnergyThermochemicalCorn Stover(Salt Lake City, UT)

Research Triangle InstituteThermochemicalWoody Biomass(Research Triangle Park, NC)

Southern Research InstituteThermochemicalVarious(Birmingham, AL)

DSM Innovation CenterBiochemicalVarious(Parsippany, NJ)

NovozymesBiochemicalVarious(Davis, CA)

GenencorBiochemicalVarious(Palo Alto, CA)

Verenium CorpBiochemical (2)Various (San Diego, CA)

DupontBiochemicalVarious(Wilmington, DE)

MascomaBiochemical

Various (Lebanon, NH)Purdue University

Biochemical (West Lafayette, IN)

Cargill IncBiochemical Various(Minneapolis, MN)

Regional PartnershipsSouth Dakota State Univ., Brookings, SD

Cornell University, Ithaca, NY

Univ. of Tennessee, Knoxville, TN

Oklahoma State Univ., Stillwater, OK

Oregon State Univ., Corvallis, OR

Key

Company

Process

Feedstock

(Location)

Ecofin, LLCBiochemical (Nicholasville, KY)

MascomaSwitchgrass(Vonore, TN)

RSEWoody(Old Towne, ME)


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32 Ladd, C. (2008, September 2008). "7 Next-Gen Biofuels to Drive Beyond Gasoline." Popular Mechanics Retrieved October 29th, 2008, from http://www.popularmechanics.com/science/earth/4277305.html.

http://www.energy.gov/media/ProjectLocations.pdf

http://www.energy.gov/media/ProjectLocations.pdf

Impact of the PlantIn what ways does an alternative-fuel plant have an impact on a community and its en-vironment? There are a number of factors to consider before building a plant. What is needed to produce the fuel? Is the production process safe for all those involved? Is the result worth the investment?

Products Produced

The products manufactured by a cellulosic ethanol plant are, of course, the final, posi-tive result. These plants can produce:

• Ethanol, used for fuel.

• Methanol, which is converted into biodiesel.

• Lignin, which is used to produce energy for the plant.

• Gypsum, which is used for drywall.

• Yeast, an animal supplement.

• Remaining inorganic material, a nontoxic substance that is pooled together in a mol-ten glass, can be used for building roads or bricks for buildings.33

Source: InEnTec LLC. Slag using the InEnTec process, 2008. http://www.inentec.com/images/thumb_glassbrick.jpg


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http://www.inentec.com/images/thumb_glassbrick.jpg

http://www.inentec.com/images/thumb_glassbrick.jpg

Water Usage

Water is vital in the processing of cellulosic ethanol, and some methods use more than others. For instance:

• The biological method may consume up to three gallons of water per gallon of fuel produced, with an energy yield of 66%. This process is used by companies, such as Logen, PET, SunEthanol, and Verenium.34

• The gasification method, in comparison, uses one gallon of water per gallon of fuel produced, with the same energy yield. This is the process used by Coskata, Inc. and Range Fuels.35

• The plant currently being built by BlueFire Ethanol in Lancaster, California will use tertiary-treated water from a wastewater treatment plant nearby.36

• A 40-million gallon a year ethanol plant uses the same amount of water per day as the average 18-hole golf course. Compare this with the amount of water it takes to produce one gallon of gasoline—2.5 to 8 gallons of water; or one pound of ham-burger—4 gallons of water; or a pound of chicken—11.6 gallons.34

Even though a substantial amount of water is used throughout the process of cellulosic ethanol, it is far less than other manufactured goods.

Emission Output

Emission output can vary depending on the process each company uses. The range of greenhouse gas (GHG) output is low in any of the processes used, and there is no need for the purchase of air quality offsets.


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35 Ladd, C. (2008, September 2008). "7 Next-Gen Biofuels to Drive Beyond Gasoline." Popular Mechanics Retrieved October 29th, 2008, from http://www.popularmechanics.com/science/earth/4277305.html.

36 Davis, B. (2009). Pollution from BlueFire production process. J. Ferguson. Irvine, Bill Davis. See attachment F

BlueFire has done an outstanding job of ensuring that their process is environmentally friendly by getting the Sierra Club, National Resource Defense Council, National Sci-ence Foundation and others involved in the peer-review studies. The BlueFire process includes Post Sorted Municipal Solid Waste, which is also referred to as “Green Waste.” Their process includes sorting through the waste to ensure that they comply with Cali-fornia’s strict air-quality standards and to make sure the feedstock they use provides them with the needed cellulose. As stated by William B. Davis in an email, “All thresh-olds for hazardous, carcinogenic, or gaseous emission have been determined to be sig-nificantly below health threshold limits by the respective enforcement agencies.” Blue-Fire’s environmentally-friendly design allows the plant to have a Zero Discharge Facil-ity Permit from the state of California and the EPA. Even their onsite vehicles will use ethanol or other alternative fuels. Mr. Davis stated that an upcoming report by the Cali-fornia Air Quality Board will state that the Lancaster Facility will, “. . . have the largest negative greenhouse gas footprint and consume no natural gas [during startup), and use no potable water in its process . . .”37

The Plasma Enhanced Melter (PEM™) process, used by InEnTec, uses a gas-cleaning system that scrubs out any harmful particulates. This process has passed all emission tests successfully--a substantial achievement as it allows for hazardous materials to be used as the feedstock. Even if there’s mercury in the feedstock, the PEM’s gas cleaning system will filter and remove it, preventing discharge into the environment. Organic materials are turned into a syngas and the non-organic materials into a nontoxic slag that becomes a glass like material.38

InEnTec has passed the following certification processes:39


25

37 Ibid. 21 See attachment F

38 Glass, M. (2009). Emissions from the PEM production process. J. F.-B. Group. Bend, Matthew Glass. See attachment C

39 InEnTec. (2009). "Testing Certifications & Approval." Retrieved Januar 29th, 2009, from http://www.inentec.com/certifications.html.

• The Environmental Technology Evaluation Program, a division of the U.S. Environ-mental Protection Agency for hazardous waste, medical waste, and electronic scrap.

• The Japanese Industrial Waste Management Foundation for Kawasaki Heavy Indus-tries.

• The Medical Waste Alternative Treatment Technology Approvals for six states, in-cluding; California, New Hampshire, Texas, New York, Michigan, and Oregon.

• The Washington Department of Ecology and USEPA for the Allied Technology Group site.

• The Taiwan Environmental Protection Agency which had Global Plasma perform the test.

• Tehama County Air Pollution Control District for a medical waste treatment facility in Northern California.

InEnTec’s ability to pass numerous certification processes shows the company’s com-mitment to providing clean energy from waste technologies.

Though the various companies have different processes, they all have the same goals--to provide an environmentally-friendly product that is produced in an environmentally- friendly setting.

Land Usage

An alternative-fuel plant will need 10 to 25 acres. It may be constructed on any site, and most often, developers look for “brown land,” an area that has been contami-nated in some way and is harmful to use for other types of construction. Compare this with an expansion of an existing landfill. The Riverbend Plan Amendment and Zone-Change Narrative states some negative aspects of an increase in the size of the landfill. These are:40


26

40 Riverbend Landfill & Recycling Center, I. J. S., Angelo Planning Group, and Cable Houston. (2008, June 2008). "Plan Amendment and Zone Change Narrative for the Riverbend Landfill Expansion." from http://www.riverbendlandfill.com/documents/expansion/1rlnarrative.pdf.

• Displacement of farmland.

• Displacement of an RV park.

• Expansion closer to Highway 18.

• Expansion closer to a river and in a floodplain.

• Concerns regarding protection of groundwater and surface water.

• Concerns that an expanded disposal capacity could provide a disincentive for waste reduction, reuse, and recycling programs.

None but the last negative aspect would be involved with the development of a cellu-losic ethanol plant.

Source: BumperFuel Group. A proposed plant site in Yamhill County, 2009.


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Noise Pollution

Noise pollution is a factor that may cause concern, yet a cellulosic ethanol plant is ex-pected to have lower noise levels than those produced at a dump site. Some of these concerns are:

• Large vehicles will need to enter and exit the plant site.

• Train service will bring waste to the site and carry fuel out.

• Machines will be needed to operate the plant; however, as they will be inside the plant, they will create a minimum amount of noise to the outside. In comparison, the current landfill site has machines operating outside that create a noise nuisance.

Transportation Impact

Transportation and traffic patterns must also be considered.

• It is recommended that land near a railroad track is optimum for reducing truck traffic through the county. With the current traffic challenges we face in Dundee, this would only be a positive factor.

• If the site is located at or near Riverbend Landfill, traffic should not increase any more than what would be expected with the growth of the landfill.

• Once the site is determined, ODOT would need to be involved to review traffic-increase needs.


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Feedstock DataFeedstock from cellulosic ethanol comes from a variety of sources. Non-organic materi-als, including those with an oil base, can be used. Non-food plant material such as wood waste, agricultural waste, and dedicated energy crops like switch grass and sug-arcane bagasse are good feedstock. Yamhill County has a strong base of organic waste, coming from logging companies and farms. It also has a fair amount of non-organic waste, which is found at the Riverbend Landfill. As we are adjacent to other counties (Marion, Washington, Multnomah, and Clackamas) with an abundant supply of organic and non-organic materials available, Yamhill County is an ideal location for a cellulosic ethanol plant. At this time, however, the feedstock already available in the county is more than enough for a full-scale plant. If the county permits the building of a cellu-losic plant that can accept municipal trash as a priority, the plant will not only produce valuable fuel but will avoid the need to expand the dumpsite before it reaches capacity in the next six years.

Logging Waste

The wood waste that is burned each year in Oregon would be an excellent source of feedstock for cellulosic ethanol plants. In the falling or logging process, wood that is not of desirable quality to make lumber is left behind as unused or unwanted waste. This includes:

• Tops and bottoms of trees.

• Limbs and broken parts.

• Wood under 5” in diameter.

• Defected or rotted wood.

• Wood that is split or shattered from falling.


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The unwanted waste is either brought to a mill for chipping or is slash piled and burned, emitting caustic pollutants into our atmosphere.

As a tree farm is under rotation every 40-50 years, careful management is needed to produce a healthy stand of timber. Therefore, the trees are thinned every 20-25 years, creating excess waste that is used for chipping; or in the case of an over-supply of tim-ber at the mill, hauling the wood waste is no longer feasible and is burned instead. Ac-cording to Larry Heesacker of A1 Logging, Inc. located near Carlton, Oregon, their company produces 66-100 tons of waste per day from April to November, and he com-mented that there are as many as 10 to 12 other logging companies of their size in the general area that produce an equal amount of waste. In regards to the harvesting of fir trees, clear-cutting is the optimal practice used since fir trees are not shade-tolerant and easily attract diseases if not managed carefully.41

Forest management is critical to the industry in order to have the least amount of nega-tive impact on our environment. A1 Logging saw an immediate advantage to locating a cellulosic ethanol plant near their area. Just in employment alone, a plant that produces 25-million gallons of fuel per year would bring in approximately 40 new Yamhill County jobs to the industry. Other benefits included a reduction in waste that could be a potential fire hazard; also, less slash piling and burning which would decrease the amount of harmful gases released into our atmosphere.

Regarding the delivery of waste to the cellulosic ethanol plant, it was noted that they would need to meet the goal of 38-45 dollars a green ton to optimize their profits. The majority of benefits would not only increase the profitability of their company and oth-ers like them but would also be a huge asset in generating income for the counties where they are located.42


30

41 Ferguson, J. (2009). Interview Larry Heesacker by Joshua Ferguson with the BumperFuel Group. McMinnville.

42 Dazey, C. (2009). Logging Information from A1. J. Ferguson. Willamina, Carryl Dazey. See Attachment G

Source: BumperFuel Group. Logging waste from privately owned tree farms, waiting to be chipped, 2009.


31

Municipal Waste from Yamhill County

The Riverbend Landfill is a great source for municipal waste to feed a cellulosic ethanol plant. According to 2007 figures, our landfill takes in more than 240,000 tons per year from our county alone. This equals 40% of the total waste sent to the landfill. This number is expected to increase to 265,000 tons per year by 2014. The methane plant, suggested by Riverbend Landfill, will not significantly reduce the greenhouse gases emitted by the site, nor will it reduce the chance of additional contamination into the ground soil or adjacent river. Riverbend’s tipping fees are $30.40 per ton.43 However, many experts from the ethanol industry suggest that tipping fees will decrease with competition from a cellulosic plant. George Sterzinger, the executive director of the Re-newable Energy Policy Project, states that the cellulosic ethanol industry will face stiff competition from landfills; therefore, the industry should count on paying for the feed-stock since the landfills have an economic stake to keep it themselves.44

Municipal Waste From Other Counties

The Riverbend Landfill currently has an additional 360,000 tons of waste per year from surrounding counties. This will only increase as counties throughout Oregon refuse to have landfills in their area. In 1991, Oregon had 94 landfills; by 2007, the state had only 30.43 As we advance from landfills to fuel plants, the number of landfills will continue to decline and viable land will increase. The counties with the foresight to build alter-native fuel plants in their communities will be considered the big winners.

Expected Municipal Waste Increase

Waste Management is asking the county to expand their Riverbend Landfill location by over 120 acres because they believe it will reach capacity within six years. During the next 20 years, they expect the site to take in 600,000 to 900,000 tons per year with an op-


32



erational income of $1.1 million. The land needed is 3 to 6 times more than that needed for a cellulosic ethanol plant, and the increased waste will fit in line with an expected increase in plant feedstock over the years. A trust fund has been established to pay for the closure and post-closure maintenance of the Riverbend site, reducing the worries of an early closure.45

Source: Waste Not of Yamhill County. Riverbend Landfill near McMinnville, Oregon, 2009.


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Sale of Ethanol

National Renewable Energy Laboratory

Currently corn produces only a small fraction of the 7-billion barrels of oil that is con-sumed in the United States. The National Renewable Energy Laboratory (NREL) be-lieves we will need to draw from multiple biomass sources to meet a large percentage of the fuel needs in the near future. Reports like the one they published in August of 2006 tells why The Department of Energy is focusing on cellulosic ethanol. In the report, they mentioned why cellulosic ethanol would outdistance other ethanols, stating: “Bio-chemical conversion techniques can also make use of more abundant ‘cellulosic’ bio-mass sources such as grasses, trees, and agricultural residues.” The National Renew-able Energy Laboratory (NREL) stated that cellulosic ethanol, “is the only viable sce-nario to replace 30% of U.S. petroleum use.”46

Renewable Fuels Association

The Renewable Fuels Association (RFA) stated in their September 2008 Ethanol Produc-tion and Demand Report that ethanol demand continued to outpace production. The expected 9-billion gallons of ethanol produced by American companies was not enough to meet the demand in 2008, so the United States was expected to import another 107-million gallons of ethanol by the year’s end. The need for ethanol will only increase as the RFA pushes for gasoline blends to include 10% ethanol throughout our country in the next few years.47


34

46 National Renewable Energy Laboratory (2006). From Biomass to Biofuels. U. S. D. o. Energy. Golden, U.S. Depart-ment of Energy; Office of Energy Efficiency & Renewable Energy, National Renewable Energy Laboratory.


SeQuential Biofuels

Oregon is fortunate to have a forward-thinking alternative-fuel provider. SeQuential Biofuels (www.sqbiofuels.com) was founded in 2000 by Ian Hill and Tomas Endicott in Eugene, Oregon where it is still based today.49

SeQuential currently sells bioethanol, biodiesel, and other traditional fuels, and the company is looking to be the first in the country to provide electric-vehicle battery-swap options. They have recognized that most of their alternative-fuel buyers are college educated, are most likely to buy “green” power for their home, and are middle to upper-middle class citizens. At the Eugene facility, 45% of their sales are generated from alternative fuels when the cost of gasoline is upwards of $3/gallon; it is 30% when the cost of gasoline is around $2 a gallon. SeQuential offers their fuel to 30 independent retailers throughout Oregon as well as their environmentally-friendly fueling station in Eugene.

Currently, the company is reviewing three locations in the Portland-Metro area to build additional alternative-fueling stations. SeQuential works with the city and county to locate “brown” land that can be cleaned up and utilized for their stations. They ask that the county or city owning the land pay $10,000 to $20,000 up front to help clean up the contaminants. Once the land has been cleared, SeQuential buys the land for a prede-termined amount, which includes the cost of the cleanup. The stations would ideally be located in areas of high traffic and in the past have been built with grants from city and state governments. 49


35

48 SeQuential BioFuels. (2008). "Ian Hill; Founder, Board Member and Retail Development " Retrieved December 8th, 2008, from http://www.sqbiofuels.com/BIOS/Ian%20Hill%20Bio.pdf.

49 Ferguson, J. (2009). Personal interview with Ian Hill of SeQuential by Joshua Ferguson. Eugene.

http://www.sqbiofuels.com

http://www.sqbiofuels.com

Source: SeQuential BioFuels. SeQuential biofuel fuel locations in Oregon, 2008, http://www.sqbiofuels.com/images/oregonmap.jpg

Source: SeQuential BioFuels. SeQuential biofuel’s Eugene, Oregon fueling station, 2008, http://www.sqbiofuels.com/images/web%20update/images/station_b.jpg


36

http://www.sqbiofuels.com/images/oregonmap.jpg

http://www.sqbiofuels.com/images/oregonmap.jpg

http://www.sqbiofuels.com/images/web%20update/images/station_b.jpg

http://www.sqbiofuels.com/images/web%20update/images/station_b.jpg

Requirements for Alternative Fuels

Federal

The Federal Government developed specific requirements in recent years for alterna-tives fuels, specifically non-corn or sugar-based fuels. In 2005, the Federal Government passed EPACT2005 which required 7.5-billion gallons of renewable fuels to be produced in 2012. By 2013, 250-million gallons of the alternative fuels must be produced from cel-lulosic ethanol. This act included a credit of $30,000, or up to 30% of a station’s cost for buying an alternative fuel pump, to be effective through 2009.50

In 2007, 6.8-billion gallons of ethanol was produced in the United States. The Energy Independence and Security Act of 2007 (H.R. 6) states that the amount of ethanol pro-duced in the United States must increase to 36-billion gallons by 2022. The bill puts a cap on corn ethanol at 15-billion gallons, calls for 15-billion gallons of cellulosic ethanol, and states that another 5-billion gallons must come from other advanced biofuels.51 The bill also requires that a fuel must reduce greenhouse gas (GHG) emissions by 60% to qualify as an advanced bio-fuel.52

President Obama’s aggressive alternative-energy plan has a focus on creating 5-million jobs while making the United States a leader on climate change. His goal includes sav-ing more oil in ten years than we currently import from Venezuela and the Middle East combined, ensuring that 10% of our electricity comes from renewable sources by 2012 and implementing an economy wide cap-and-trade program that will reduce green-


37

50 National Renewable Energy Laboratory (2007). Research Advances Cellulosic Ethanol. Golden, U.S. Department of Energy; Office of Energy Efficiency & Renewable Energy, National Renewable Energy Laboratory.

51 National Governors Assocation. (2008, October 15th, 2008). "States to Enhance Access to E-85 Fueling Stations." National Governors Association Retrieved October 27th, 2008, from http://www.nga.org/portal/site/nga/menuitem.6c9a8a9ebc6ae07eee28aca9501010a0/?vgnextoid=15e60783f8bfc110VgnVCM1000001a01010aRCRD.

52 Renewable Fuels Association. (2008). "Renewable Fuel Standards." Retrieved December 8th, 2008, from http://www.ethanolrfa.org/resource/standard/.

house gas emissions to 80% by 2050. This plan includes an injection of $150 billion to help build an alternative-fuel infrastructure over the next 4 years.53

State

The state of Oregon requires that all gasoline include 10% ethanol, at this time, to re-duce GHG as well as oil consumption.54 House Bill (HB) 3543 is set to reduce GHG to 10% by 2020 and 75% by 2050. These goals are compatible with Senate Bill (SB) 838, which requires Oregon to have 25% of its energy from renewable resources by 2025.55 Oregon’s goals for reduced GHG would be realized with the conversion to alternative fuels, such as cellulosic ethanol.

Source: KATU. BioFuels made in Oregon, 2008,

http://media.katu.com/images/080117_bio_fuel_oregon.jpg


38

53 Obama-Biden Transition Team. (2008). "The Obama Biden Plan - Energy Plan Overview." Retrieved December 11th, 2008, from http://change.gov/agenda/energy_and_environment_agenda/.

54 State of Oregon. (2008). "Oregon Incentives and Laws; Renewable Fuels Mandate." Retrieved December 12th, 2008, from http://www.afdc.energy.gov/afdc/progs/view_ind.php/or/6274.

55 State of Oregon (2007, July 3rd, 2007). "Governor Kulongoski Signs Biofuels Legislation, Press Release." Retrieved December 10th, 2008, from http://www.oregon.gov/Gov/P2007/press_070307b.shtml.



Alternative Fuel Production in Oregon

Lane County

Lane County has spent the last two years actively searching for an alternative-fuels company. They have set aside a 10-acre project site that is located inside the urban growth boundary of Junction City. The land is to be sold to a prospective owner at a low cost to attract multiple companies. Throughout their search, they have received multiple prospective clients but are still working on the resolution of the local and state permits. The county has received grants to help with the studies and anticipates addi-tional grants for the funding of the construction.56

Multnomah County

Scott Robinson, with Oregon Metro Government, has stated in an email that the re-gional council members are looking at 0% landfill options like those in Sweden and Denmark, though no final option has been determined. The Metro Council is consider-ing the possibility of converting trash to fuel. Further studies and a final answer are ex-pected in 2009.57

Marion County

Marion County has been at the forefront of alternative fuel production. They had the first biodiesel facility in the Northwest, which was launched in 2004. The plant is owned by SeQuential-Pacific Biodiesel LLC (Eugene, Oregon) and Pacific Biodiesel (Maui Hawaii), and it has been producing 1-million gallons of fuel per year since the day it opened. SeQuential saw the biodiesel market grow significantly over the past few years; and in 2008, SeQuential Pacific Biofuels completed their second biodiesel plant in Marion County. This plant can produce 5-million gallons of fuel per year from


39

56 McKenzie-Bahr, M. (2009). Lane County's alternative fuel project. J. F.-B. Group. Eugene. See attachment D

57 Robinson, S. (2009). Email about alternative waste project for Portland, Oregon. J. F.-B. Group. Portland, Scott Rob-inson. See attachment E

used cooking oil and regionally produced oil from seed crops.58 Marion County has embraced alternative fuels, allowing them to feature their “green” side, as well as in-crease the number of jobs and tax base for the county.

Source: SeQuential-Pacific Biofuels. Drawing of the biodiesel plant in Salem, Oregon, 2008,

http://salembiodiesel.com/bioplant.jpg


40

58 SeQuential Biofuels. (2008). "Salem Biodiesel Production Facility Opens." Retrieved January 25th, 2009, from http://www.sqbiofuels.com/production.htm.



Morrow County

Morrow County is a great example of how a county and city can work together on at-tracting multiple alternative-fuel sites.

The first ethanol plant built in Oregon is located in Boardman and constructed by Pa-cific Ethanol. This plant currently produces 40-million gallons of fuel per year and has been in operation since the third quarter of 2007.59 Pacific Ethanol is currently adding a cellulosic ethanol pilot plant that will produce an additional 2.7-million gallons of fuel per year. This plant is partnering with BioGasol ApS and BioEnergy Institute, a joint venture of Lawrence Berkley National Laboratory and Sandia National Laboratory. The technology being used at the plant will allow it to utilize wheat straw, wood chips, and corn stover as the feedstock. The pilot plant is expected to be completed in the fourth quarter of 2009 and has received matching funds from the Federal Government to help with the costs.60

Portland General Electric (PGE) has introduced algae farming to Morrow County in which greenhouse gas is taken from the coal power plant and fed to algae. This process reduces the carbon emissions of the energy plant by more than 76% and mercury emis-sions by 90%. It also provides algae ethanol and feed for animals. Columbia Energy Partners is working with PGE on this project with hopes of learning how to turn this small-scale project into a commercially viable-scale system.61


41

59 Pacific Ethanol. (2008). "Facilities & Locations / Columbia." Retrieved January 26th, 2009, from http://www.pacificethanol.net/site/index.php/facilities/facilities_article/107/.

60 Pacific Ethanol. (2008, January 29th, 2008). "Pacific Ethanol Wins DOE Cellulosic Energy Grant." Retrieved January 25th, 2009, from http://www.pacificethanol.net/site/index.php/news/news_article/285/.

61 Portland General Electric. (2008, November 21st, 2008). "PGE: Algae turns CO2 gases into fuel, livestock feed." Retrieved January 25th, 2009, from http://www.katu.com/news/business/29759079.html.

Source: Pacific Ethanol. Ethanol plant in Boardman, Oregon, 2008,

http://www.pacificethanol.net/site/_images/plant_photos/Columbia_10.07_main.JPG


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Highlights of Cellulosic Ethanol CompaniesThis report covers four companies that currently produce cellulosic ethanol—Iogen Corporation, BlueFire Ethanol, InEnTec, and Coskata, Inc. Each one is highlighted for a specific reason. There are many other companies that are at various stages of develop-ment. Some are under full operation, others are under construction, a few are research-ing possibilities, and many are determining a location for a first or second site.

Iogen Corporation

Iogen Corporation is located in East Ottawa, Ontario, Canada (http://www.iogencorp.us). Biofuels Digest rated them #18 of the “hottest companies around the globe” for the coming year, 2008-2009.62 The company opened in the 1970s with the intent of becoming a leading biotechnology firm in Canada. They are the first pre-commercial dem-onstration facility to convert biomass to cellulosic ethanol using en-zyme technology.63 The Iogen process requires at least 60% carbohy-drate content to be cost effective, and it must be done in large quantities.64

The plant sits on a 10-acre site in Ontario. Here, agriculture residues make 2-million li-ters of clean-burning cellulosic ethanol fuel per year. Feedstock for the plant includes:

• Wheat

• Oats

• Barley straw

Source: Iogen Cor-poration. Iogen logo, 2008, http://www.iogen.ca/images/logo.jpg


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62 Lane, J. (2008, December 22nd, 2008). "The Hottest 50 Companies in Bioenergy." Biofuels Digest Retrieved January 5th, 2009, from http://biofuelsdigest.com/blog2/2008/12/22/coskata-sapphire-energy-and-virent-head-the-“50-hottest-companies-in-bioenergy”-rankings/.

63 Iogen Corporation. (2008). "About Iogen Corporation " Retrieved December 10th, 2009, from http://www.iogen.ca/company/about/index.html.

64 Iogen Corporation. (2008). "FAQ Iogen Corporation " Retrieved December 10th, 2009, from http://www.iogen.ca/company/faq/index.html.

http://www.iogen.ca/images/logo.jpg








http://www.iogencorp.us




• Corn stover

• Hardwood chips

• Switch grass

• Other grasses

The plant operates 24 hours a day, 7 days a week and can handle all functions involved in the production process—receipt of feedstock, pretreatment of up to 30 tons of feed-stock a day, conversion of cellulose fiber into glucose, fermentation, and distillation. They are currently assessing potential locations for a commercial-scale cellulosic ethanol plant and hoping to open partnerships before long.65

Iogen receives support from both government and corporate funds. Public and private investment is estimated at $130 million over the past 25 years. Investors include Royal Dutch/Shell, Petro-Canada, and Goldman Sachs.66

The company’s intent is to commercialize their cellulosic ethanol process by licensing their technology through “turnkey plant construction partnerships.” Iogen will gener-ate new income from license fees and supplying the necessary enzymes to these new licensees’ plants. They believe that they can be competitive with the price of rack (pre-tax) gasoline, and if 35% of the gasoline in Canada had 10% cellulosic ethanol in it, the reduction in greenhouse gasses would be equivalent to removing 400,000 cars from the road.67


44

65 Iogen Corporation. (2008). "Iogen Corporation Facilities." Retrieved December 10th, 2009, from http://www.iogen.ca/company/facilities/index.html.

66 Iogen Corporation. (2008). "Iogen Corporation Partners." Retrieved December 10th, 2009, from http://www.iogen.ca/partners/overview/index.html.

67 Iogen Corporation. (2008). "Iogen Corporation Benefits." Retrieved December 10th, 2009, from http://www.iogen.ca/cellulosic_ethanol/benefits/index.html.

BlueFire Ethanol

BlueFire is located in Irvine, California (http://www.bluefireethanol.com) and was identified as #13 in the Biofuels Digest of “hottest companies for 2008-2009”.68 This company uses the Arkenol patented process, which holds ten patents in the U.S., Canada, New Zealand, Australia, and South Africa, with additional

patents pending. The process utilizes acid hydrolysis rather than enzymes, a technique they have been perfecting for over ten years. The company has a goal of producing 1.5-billion gallons of ethanol with $2.7 billion in revenue by 2012.69

BlueFire is one of the cellulose-to-ethanol companies worldwide with demonstrated production of ethanol from urban trash. Their plants currently utilize the following feedstock:

• Municipal waste

• Farm waste

• Logging waste

• “Energy crops” like switch grass, wheat straws, rice, and other agricultural residues

The company’s first plant was built in Japan as a commercial demonstration plant that showed proof-of-concept. It has been in production since 2002 and is operated by JGS Corporation, in conjunction with NEDO, a Japanese government entity. This plant uses urban, commercial, and farming waste to produce the ethanol fuel.70

Source: BlueFire Ethanol. BlueFire logo, 2008.


45


69 BlueFire Ethanol. (2006, August 22nd, 2006). "BlueFire Ethanol Identifies Southern California Landfill as Initial Lo-cation in the U.S. for Commercialization of Cellulose Ethanol Technology." Retrieved December 12, 2008, from http://www.bluefireethanol.com/pr/6/.

70 BlueFire Ethanol. (2008). "Izumi Biuorefinery - in operation since 2002." Retrieved November, 11th, 2008, from http://www.bluefireethanol.com/images/IZUMI_Status_2004_for_BlueFire_051606.pdf.

http://www.bluefireethanol.com

http://www.bluefireethanol.com

Because of the success of their Japanese plant, the company set out to build bio-refineries in markets with the highest demand for ethanol. Their intent was to “dra-matically reduce delivery costs and increase biofuels supply, while providing a unique waste processing technology that helps cities better manage the problem of overflowing landfills.” BlueFire was one of six companies to be awarded a $40-million grant from the Department of Energy. Their first commercial scale plant will be located in Lancas-ter, just northeast of Los Angeles. A construction permit was received in July, 2008, and earlier reviews noted that the completion date was estimated to be late 2009 and would cost approximately $30 million.71 However, when the authors’ of this study toured the site, it was reported to them that construction would be delayed due to funding. Blue-Fire confirmed that “disruption in the capital markets, as well as time spent overcoming an appeal against the company’s conditional use permit, combined with high materials prices in the second half of the year, contributed to the Lancaster project delay.” When the authors spoke with a Waste Management employee at the site, the exact location of the cellulosic ethanol plant was pointed out to them. The 10-acre site is next to the Lan-caster Landfill where the plant will consume 175 tons a day of post-sorted municipal solid waste, in cooperation with Waste Management Corporation72, and it will produce 3.2-million gallons of ethanol per year. A bio-butanol conversion plant will also be lo-cated on the site. BlueFire’s CEO, Arnold R. Klann, recently commented about the Lan-caster plant: “We have made significant progress in our efforts to build the first cellulose-to-ethanol facility in California. This facility will be a catalyst for cellulosic fuel production throughout our nation and will provide the first building block in gen-erating the 16-billion gallons of cellulosic ethanol per year that were outlined in the recently-passed Energy Bill.” 73


46

71 BlueFire Ethanol. (2007, May 22nd, 2007). "BlueFire Announces Second Project Location." Retrieved December 12th, 2008, from http://www.bluefireethanol.com/pr/30/.

72 Govreau, J. (2008, July 28th, 2008). "BlueFire Gets County Permit to Proceed With Construction of Landfill Waste-to-Ethanol Plant in Califonia." Reuters Retrieved January 3rd, 2009, from http://www.reuters.com/article/pressRelease/idUS67515+28-Jul-2008+MW20080728.

73 Miller, C. S. (2008, July 24th, 2008). "BlueFire Ethanol to build in California." Retrieved January 21st, 2009, from http://bioconversion.blogspot.com/2008/07/bluefire-ethanol-to-build-in-california.html.

BlueFire’s second commercial scale cellulosic ethanol plant will begin construction in 2010 near Mecca, California, which is southeast of Palm Springs in Riverside County near the Salton Sea. It is currently in its Phase I engineering design phase and is esti-mated to produce 19-million gallons of fuel per year. Besides the grant money received from the Department of Energy, BlueFire will begin raising funds for the remainder of the $130 million for construction costs in the near future. They will work with Burrtec Waste Industries, JGC Corporation, Brinderson Roelsien, MECS Inc., NAES, and Petro Diamond to complete the project by the middle of 2012.74

The company’s Orange County plant will be located in Corona, California. Other com-panies taking part in its development are Waste Management, Petro-Diamond (Mitsubi-shi subsidiary), JGC Corporation, MECS, and Colmac Energy. The plant will also pro-duce 19-million gallons of fuel per year by using 700 tons a day of sorted green waste, wood waste, and other cellulosic-urban waste for feedstock. The cellulosic-urban waste will come from a landfill that has been depositing 10,000 tons a day from Southern Cali-fornia counties since 1986. BlueFire and Waste Management expect the revenue from the plant to be $55 million a year with an operating income of $25 million a year, before tax credits or government incentives. BlueFire’s CEO states: “The proposed landfill site in California is the perfect location and provides a model that can be easily replicated across multiple regions of the United States to the fuel markets. Our partner (Waste Management) in this transaction, alone, has control of over 200 landfills in North Amer-ica where BlueFire’s technology can be deployed.”75

The BlueFire plants that will soon be under construction will take approximately 14 months to build and are expected to show a profit by the third quarter of operation.76 A


47

74 BlueFire Ethanol. (2008). "Mecca California plant press release." Retrieved February 19th, 2009, from http://www1.eere.energy.gov/biomass/pdfs/bluefire_fact_sheet_12_9_08.pdf.

75 BlueFire Ethanol. (2006, August 22nd, 2006). "BlueFire Ethanol Identifies Southern California Landfill as Initial Lo-cation in the U.S. for Commercialization of Cellulose Ethanol Technology." Retrieved December 12, 2008, from http://www.bluefireethanol.com/pr/6/.


press release by the company quoted BlueFire’s CEO saying: “While our waste-to etha-nol process doesn’t need the tax credit to be commercially viable, the farm bill does help to mitigate the financial markets’ perceived risks . . .”.77

BlueFire is looking for additional partnerships like the two they have with Waste Man-agement in Lancaster and Corona, California. The following are characteristics for ideal location sites:

• Near current landfill locations.

• Near long-term landfill diversion facilities.

• Have an ethanol sales plan.

• Have the potential for co-location with co-generation facilities.

• Have developed a business plan that links to a waste-segregation plan.

• Are in a county that is working on a pipeline of similar projects.

• Have regional diversity.

• Have a good transportation infrastructure in place.

• Have one or more businesses with a strong credit worthiness and/or credibility in the marketplace.

BlueFire proposes that the production sites need strategic partnerships, with candidates who demonstrate experience and exhibit a qualified-business model from which the BlueFire technology will form a key business component. 78 In a press release, dated July 24, 2008, BlueFire noted: “Ethanol will be produced from biorefinery facilities op-portunistically constructed on or near landfills, or waste collection and waste-separation


48

77 BlueFire Ethanol. (2008, May 16th, 2008). "Farm Bill Helps Advance U.S. Biofuels Production." Retrieved Decem-ber 15, 2008, from http://www.bluefireethanol.com/pr/53/.


sites.”79 To expedite their interest in expansion, BlueFire utilizes a prefabrication and modular construction method which cuts costs, maintains quality, and creates the fastest-to-market time for deployment of the complex. The “modular” design allows for easy growth and construction.80 Just recently, BlueFire announced that Ubiex, Inc. has signed a Professional Services Agreement (PSA) with them to develop a cellulosic etha-nol facility in South Korea. BlueFire will provide the preliminary engineering design package and technical support for the project. Their CEO comments: “By providing a viable cellulosic ethanol solution for countries that are agrarian-based or have signifi-cant cellulosic residue that can be converted into liquid fuels that offset the countries’ import of energy and secures its energy future, BlueFire remains well-positioned for long-term sustainability and international growth.”81


49

79 BlueFire Ethanol. (2007, May 22nd, 2007). "BlueFire Announces Second Project Location." Retrieved December 12th, 2008, from http://www.bluefireethanol.com/pr/30/.

80 BlueFire Ethanol. (2008, July 24th, 2008). "BlueFire Ethanol Awarded Final Permits to Construct the Nation's First Commercial Cellulosic Ethanol Production Plant." Retrieved November 18th, 2008, from http://www.bluefireethanol.com/pr/57.

81 BlueFire Ethanol. (2008, December 11th, 2008). "BlueFire Retained by Ubiex, Inc. to Design Cellulosic Facility in South Korea." Retrieved November 11th, 2008, from http://www.bluefireethanol.com/pr/64/.

Source: BumperFuel Group. BlueFire’s Lancaster, California future plant location 2009.

Source: BlueFire Ethanol. Rendering of waste to fuel plant in Lancaster, California 2008.


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InEnTec

InEnTec is located in Bend, Oregon (http://www.inentec.com). Their Plasma-Enhanced Melter (PEM™) Process is a proven technology that has been around for over 13 years. Mr. Surma, CEO of InEnTec, stated in an email: “InEnTec originated from research conducted at the Pacific Northwest National Laboratory [PNNL] in Richland, Washington and the Plasma Fusion Center at the Massachusetts Institute of Technology

[MIT].82

The company states that the PEM™ process is commercially viable and can be used with virtually any waste product as feedstock. The PEM™ process uses the following feedstock:83

• Medical waste

• Municipal waste

• Tires

• Asbestos insulation

• Construction related products

InEnTec sells the PEM™ system to companies that operate the plants. As a rule, InEn-Tec does not own or operate the plants, itself. They do, however, have a commercially viable plant in Nevada that is currently under construction and expects it to be com-pleted in 2010, using the PEM™ process. The plant will use 90,000 tons of municipal waste from the Tahoe-Reno area and should produce 10.5-million gallons of fuel per

Source: InEnTec LLC. InEnTec logo, 2008, http://www.inentec.com/images/ins_logo.gif


51

82 Surma, J. E. (2008). Letter to Mr. McPhillips regarding InEnTec's PEM process. R. McPhillips. Bend, Jeffrey E. Surma. See attachment H

83 InEnTec. (2008). "Plasma Enhanced Melter (PEM) Systems Overview." Retrieved December 10th 2008, from http://www.inentec.com/pemprocess.html.

http://www.inentec.com/images/ins_logo.gif






http://www.inentec.com

http://www.inentec.com

year. Even with a cost of $120 million to build the plant, the company expects it to have a strong financial return. 84

InEnTec has installed and operated PEM™ systems in several other locations. A G100P PEM™ in Richland, WA is designed to transform 20% or 25 tons per day of the city's municipal solid waste. Another facility in Richland was used to process mixed hazard-ous and radioactive waste-some of the most difficult to manage. InEnTec is currently installing a system at the Dow Corning facility in Midland Michigan to convert certain spent materials into new process feedstocks.85

All of these plants have taken 18 to 24 months to construct. Commercial-scale plants should take less time to build, as InEnTec’s current design is modular and therefore quicker to deploy.86 Not all of InEnTec’s plants are planned to convert the waste to ethanol, but all of InEnTec’s plants convert waste into energy while emitting little to no greenhouse gases.87


52

84 InEnTec. (2008, July 22nd, 2008). "Ethanol Breakthrough." Retrieved December 3rd, 2008, from http://www.inentec.com/news-07-08.html.

85 InEnTec. (2009). "Testing Certifications & Approval." Retrieved Januar 29th, 2009, from http://www.inentec.com/certifications.html.

86 Surma, J. E. (2008). Letter to Mr. McPhillips regarding InEnTec's PEM process. R. McPhillips. Bend, Jeffrey E. Surma. See attachment H

87 Glass, M. (2009). Emissions from the PEM production process. J. F.-B. Group. Bend, Matthew Glass. See attachment C

Source: InEnTec. G300 PEM™ system in Iizuka, Japan, 2008, http://www.pacificethanol.net/site/_images/plant_photos/Columbia_10.07_main.JPG


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Coskata

Coskata is located in Warrenville, Illinois (http://www.coskata.com). They were rated #1 for Biofuels Digest “hottest companies for 2008-2009”88 because they have what many in the industry consider to be the most advanced process using the biological and thermo-chemical process.

Argonne National Laboratory determined that the Coskata process could yield a 7.7 net energy balance and reduce greenhouse gases by as much as 80% to 90% versus gasoline. The process involves changing the feedstock into synthetic gases. Each type of feedstock is separated and then converted to fuel by using plasma technol-ogy; the plant matter is gasified. It is this dual process ability that makes Coskata’s sys-tem stand out. Once the feedstock has been separated, organic microbes are introduced to the syngas to convert it into liquid fuels. They allow the microbes to grow in colonies and form “slimes,” which is different from most producers that swirl the microbes in water to prevent colonies and slime. The process will distill the fluid to about 50% and then membrane technology makes the fuel 99.9% pure. This reduces the cost and en-ergy needed to produce the fuel, allowing the company to claim a cost of less than $1/gallon to make the fuel.89

Coskata’s highly-developed process allows the company to make 100 gallons of fuel with 1 ton of dry feedstock90 and has proven to cut greenhouse gas emissions from

Source: Coskata.Inc. Coskata logo, 2008, http://www.coskata.com/images/coskata_logo.jpg


54


89 Coskata Inc. (2008). "Advantages of the Coskata Process." Retrieved December 8th, 2008, from http://www.coskata.com/processadvantages.asp.

90 Coskata Inc. (2008). "Feedstock Potential." Retrieved December 8th, 2008, from http://www.coskata.com/ethanolfeedstockpotential.asp.

http://www.coskata.com/images/coskata_logo.jpg






http://www.coskata.com

http://www.coskata.com

“stump to wheel” by 90%. Conceivably the company could make 50-billion gallons of fuel a year if they could harness all the CO and H2 from every steel mill in the world.91

The Coskata system uses a wide variety of feedstock including:92

• Municipal waste

• Energy crops, like switch-grass

• Carbon heavy garbage, like tires

• Farm waste

• Logging waste

The company is currently in the process of building a commercial demonstration plant in Madison, Pennsylvania. The plant is expected to cost $25 million dollars and will be located near the Westinghouse Plasma Center, which is the current site of a pilot gasifier plant owned and operated by Westinghouse Plasma Corporation, a provider of equip-ment used for the Coskata process. The fuel produced at the plant will be used at the General Motors Milford Proving Grounds in Milford, Michigan. This location is ex-pected to start production in 2009.93

Coskata is in discussion with U.S. Sugar to build a 100-million gallons a year site in Clewiston Florida. The site is expected to be the largest second-generation ethanol plant in the country, and they anticipate higher profits than other sugar-to-fuel ethanol plants. Their plant will be able to convert “leftover” sugarcane into fuel, as well as con-vert the leaves, plant tops, and crushed-up stems (bagasse) from fields into fuel rather


55

91 Kanellos, M. (2008, April 7th, 2008). "Coskata CEO explains how to get to $1 a gallon ethanol." CNET Retrieved September 9th, 2008, from http://news.cnet.com/8301-11128_3-9913192-54.html.

92 Coskata Inc. (2008). "Feedstock Potential." Retrieved December 8th, 2008, from http://www.coskata.com/ethanolfeedstockpotential.asp.

93 Coskata Inc. (2008, April 20th, 2008). "Coskata Inc. Selects Madison, Pa. for Commercial Demonstration Facility to Produce Next-Generation Ethanol." Retrieved December 10th, 2008, from http://www.coskata.com/PageBody/MadisonFacilitypressrelease.htm.

than burn them. Both Coskata and U.S. Sugar expect to use loan guarantees from the state of Florida and the Federal Government.94 They hope to break ground in 2009.95

Funding for Coskata has come from venture capital, corporate investment from compa-nies like General Motors, and private equity funds. The Madison plant has been con-structed completely with private money.96

General Motors is helping Coskata expand into Australia and China, currently the third largest producer of ethanol. Holden, a division of General Motors, is currently working with Coskata to construct a plant in Australia.97 General Motors of China has also helped Coskata make a connection with the Chinese government, where they intend to build a commercially viable plant in their country in the near future.98

William Roe, CEO of Coskata, states that the fuel can be made for less than $1 a gallon, providing a strong cost benefit for the fuel. This includes the price for the feedstock, en-ergy, and labor; but it does not include paying off the capital of the plant, taxes, retail markups, government subsidies, or other expenses that are added to the sale of the fuel.

Costkata’s goal is not to own or operate large plants but, instead, to sell their technology to large companies that will own and operate the plants themselves. They do and will


56

94 Morrison, C. (2008, November 19th, 2008). "U.S. Sugar Looks Sweeter With Coskata Second-Gen Ethanol Plant." BNET Energy Retrieved December 8th, 2008, from http://industry.bnet.com/energy/1000391/us-sugar-looks-sweeter-with-coskata-second-gen-ethanol-plant/?tag=content;col1.

95 Energy Current - News for the Business of Energy. (2008, November 17th, 2008). "U.S. Sugar, Coskata consider Flor-ida ethanol facility." Energy Current, News for the Business of Energy Retrieved January 26th, 2009, from http://www.energycurrent.com/index.php?id=2&storyid=14361.

96 Coskata Inc. (2008, April 20th, 2008). "Coskata Inc. Selects Madison, Pa. for Commercial Demonstration Facility to Produce Next-Generation Ethanol." Retrieved December 10th, 2008, from http://www.coskata.com/PageBody/MadisonFacilitypressrelease.htm.

97 Duncan, J. (2008, December 6th, 2008). "Holden embraces alternative fuels." NineMSN News Retrieved December 31st, 2008, from http://news.ninemsn.com.au/article.aspx?id=682972.

98 Sims, B. (2008, October 27th, 2008). "Coskata plans to enter Chinese ethanol market." Ethanol Producer Magazine November 2008 Issue. Retrieved January 5th, 2008, from http://www.ethanolproducer.com/article.jsp?article_id=4944&q=coskata&category_id=56.

continue to own small and mid-sized demonstration plants, and they are currently con-versing with large forestry companies, chemical manufacturers, and petroleum producers.99

Source: Coskata Inc. Rendering of waste to fuel plant in Madison, Pennsylvania 2008.


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99 Kanellos, M. (2008, April 7th, 2008). "Coskata CEO explains how to get to $1 a gallon ethanol." CNET Retrieved September 9th, 2008, from http://news.cnet.com/8301-11128_3-9913192-54.html.

Flexfuel VehiclesThe Renewable Fuels Association stated in their September 2008 Ethanol Production and Demand Report that ethanol demand continues to outpace production.100 There are over 7-million flexfuel vehicles on the road today that are fueling this demand, and the three major U.S. automakers are expected to produce another million+ flexfuel vehicles this year. By 2012, their goal is to make half of their products flexfuel capable.101

Currently General Motors, Ford, and Chrysler offer the following vehicles:

General Motors102

• Buick – Lucerne

• Cadillac - Escalade

• Chevrolet – HHR, Impala, Silverado, Suburban, Tahoe, Avalanche, and Express

• GMC – Sierra, Yukon, Yukon XL and Savanna

• Pontiac – G6

Ford Motor Company103

• Ford – F-150, Crown Victoria, Fusion, and Expedition

• Mercury – Grand Marquis and Milan


58

100 Renewable Fuels Association. (2008). "Statistics." Retrieved December 8th, 2008, from http://www.ethanolrfa.org/industry/statistics/#Top.

101 National Governors Assocation. (2008, October 15th, 2008). "States to Enhance Access to E-85 Fueling Stations." National Governors Association Retrieved October 27th, 2008, from http://www.nga.org/portal/site/nga/menuitem.6c9a8a9ebc6ae07eee28aca9501010a0/?vgnextoid=15e60783f8bfc110VgnVCM1000001a01010aRCRD.

102 General Motors. (2008). "Vehicle Overview." Retrieved December 20th, 2008, from http://www.gm.com/experience/fuel_economy/altfuel/vehicles/overview/.

103 Ford Motor Company. (2008). "Ford Corporate webpage." Retrieved December 20th, 2008, from http://www.ford.com/vehicles/commercial-vehicles/environmental-vehicles/leading-ethanol-capable-vehicles/flexible-fuel-vehicles-331p.

• Lincoln – Town Car and Navigator

Chrysler Limited Liability Partnership104

• Chrysler – Sebring, Town & Country, and Aspen

• Dodge – Ram, Avenger, Caravan, Dakota, and Durango

• Jeep – Grand Cherokee and Commander

Flexfuel vehicles are currently the only product that offers a range of vehicles for every personal and business need while still providing an economical vehicle for low and moderate-income Americans.


59

104 Chrysler LLC. (2008). "Fueling Renewable Energy Sources." Retrieved December 20th, 2008, 2009, from http://www.chryslerllc.com/en/environment/green_fuels/.

Government Funding, Loans and Tax CreditsSince 2005, Federal and State governments have implemented laws that require an in-crease in the usage of alternative fuels. These bills, and others, have been comprised of a fair number of grants, loans, and tax credits to help this new industry thrive and sur-vive. President Barack Obama also has an aggressive plan to reduce the amount of oil the United States uses for fuel. The plan includes a large injection of funding for the Cellulosic Ethanol Industry. This report covers some of the funding, loans, and tax credits that are currently available for cellulosic ethanol plants, as well as financial in-centives that are expected soon from both the Federal Government and State of Oregon.

Federal

Much of the funding for alternative energy began in 2005 with the Title XVII of the En-ergy Policy Act (EPAct). The EPAct was designed to stimulate investment and commer-cialization of energy from clean technologies. It provided 100% loan guarantees, of not more than 80% of the project, for programs that fostered President George W. Bush’s goal of diversifying the country’s energy needs. In 2006, over 143 applications were vy-ing for the $9 billion available.

The projects had strict oversight and needed to meet the following criteria: 105

• The project must employ new technologies that avoid, trim down, or sequester air pollutants of greenhouse gases, compared to technologies that are in service com-mercially in the United States on the day the financial loan is executed.

• The company borrowing the money must have a large equity stake in the project, and proceeds from any debt or government grants will not be considered equity.

• Receiving grants or other forms of government assistance does not exempt the pro-ject from the loan-guarantee program.


60

105 Department of Energy. (2007, October 4th, 2007). "DOE Announces Final Rule for Loan Guarantee Program." Re-trieved January 4th, 2009, from http://www.energy.gov/news/5568.htm.

• Administrative fees charged by the Department of Energy (DOE) and credit-subsidy costs cannot be included in the project cost when determining the guaranteed loan amount from the DOE.

• Fees will be charged to cover administrative expenses incurred by the DOE.

• The Secretary of Energy will need to determine that the project has a “reasonable prospect” of being paid back before the guaranteed loan can be issued.

• The DOE has the higher lien on the project’s assets that have been pledged for the loan guarantee, if there is a default on the loan.

The companies that received funding in 2006 under the biomass section of the EPAct of 2005 program include:106

• Alico

• BlueFire Ethanol

• Choren USA

• Endicott Biofuels, LLC

• Iogen Biorefinery Partners, LLC

• Voyager Ethanol, LLC

The Energy Independence and Security Act of 2007 opened up grants to be given for re-search, development, and commercial application of biofuels. It authorized $25 million for the fiscal year 2008 through 2010 for states with a low rate of ethanol production. Another $500 million will be allocated starting in 2008 and ending in 2015 under this program for the advancement of biofuels that reduce GHGs by 80% as compared to cur-rent fuels.107


61

106 Ibid. 57

107 Renewable Fuels Association. (2007). "The Energy Independence and Security Act of 2007 - H.R. 6." Retrieved December 8th, 2008, from http://www.ethanolrfa.org/resource/cellulosic/documents/SummaryofCelluloseRFSProvisionsEISA2007.pdf.

In January, 2008, the DOE announced that it would provide $114 million over 4 years to small-scale cellulosic plants. These plants must produce liquid transportation fuels as well as bio-based chemicals and bioproducts used in industrial applications.108

The 2008 Farm Bill, also known as the Food, Conservation, and Energy Act of 2008, in-cluded additional loan guarantees and a per-gallon credit for the Cellulosic Ethanol In-dustry. The United States Department of Agriculture (USDA) will be offering a loan guarantee of up to $250 million a project under the farm bill. The first wave of applica-tions was due by December 31, 2008 and will be issued by March 31, 2009. The second wave of applications is due by April 20, 2009 and will be issued in September, 2009.109 The Farm Bill also provides tax credits for producers of cellulosic ethanol. From 2008 through 2013, a cellulosic ethanol producer may receive a tax credit to offset against the producer’s income-tax liability of $1.01 a gallon. This tax credit does not offset the al-ternative minimum tax liability, and credits in excess of tax liability will not be paid. To encourage new pilot plants, producers that make less than 60-million gallons of fuel each year from these plants will receive an additional $0.10 a gallon credit.110

Public Law No: 109-432 allows an additional first-year depreciation deduction for cellu-losic ethanol plants of 50%.111


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109 United States Department of Agriculture. (2008, November 19th, 2008). "USDA Invites applications for advanced biorefinery guaranteed loans." Retrieved December 12th, 2008, from http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_2KD?contentidonly=true&navid=FARMBILL2008&contentid=2008/11/0298.xml.

110 Renewable Fuels Association. (2007). "The Energy Independence and Security Act of 2007 - H.R. 6." Retrieved December 8th, 2008, from http://www.ethanolrfa.org/resource/cellulosic/documents/SummaryofCelluloseRFSProvisionsEISA2007.pdf.

111 Renewable Fuels Association. (2006, December 20th, 2006). "New Cellulosic Biomass Ethanol Depreciation Allow-ance "50% Depreciation for Cellulosic Biomass Ethanol Plant Property"." Retrieved December 8th, 2008, from http://www.ethanolrfa.org/resource/cellulosic/documents/RFAIssueBrief-CellulosicEthanolDoubleDepreciation.pdf.

President Barack Obama’s plans will emphasize the importance of investing in climate-friendly forms of energy. He will push for $150 billion to be spent in developing and promoting commercial-scale renewable-energy businesses with a strong focus on cellu-losic ethanol.112 Samuel Bodman, President Obama’s Secretary of Energy, is an adamant fan of cellulosic ethanol and has done research in this area, which is why many believe there will be a focus on this technology by the Obama Administration.113

All together, the energy focus of our new presidential administration, accelerated de-preciation, tax credits, grants, and guaranteed loans give the legal and financial upper-edge that the alternative-fuel providers have needed to build an infrastructure that can compete with the large oil companies.

State of Oregon

The state of Oregon has an aggressive plan that works hand-in-hand with the federal government’s desire to grow the alternative-fuel industry. This includes loan assistance and tax credits for both the producer and the consumer.

The Energy Loan Program (SELP) offers low-interest loans for projects that save energy, produce energy from renewable resources, use recycled materials to create products, or use alternative fuels. The loans can be issued to businesses, individuals, cities, counties, state and federal agencies, public corporations, cooperatives, and non-profit organizations.114

The Legislature recently approved an increase in the business energy tax credit (BETC). This increase allows a company to receive a credit for the first $10 million invested for every dollar spent. There is a credit cap of 50%, and the credit may be used over 8 years or used as a passthrough to allow the project owner to transfer credits for a lump sum


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112 Obama-Biden Transition Team. (2008). "The Obama Biden Plan - Energy Plan Overview." Retrieved December 11th, 2008, from http://change.gov/agenda/energy_and_environment_agenda/.

113 Davis, J. (2008, January 21st, 2009). "Biodiesel Board Congratulates Vilsack & Chu." Domestic Fuel Retrieved De-cember 12, 2008, from http://domesticfuel.com/2009/01/21/biodiesel-board-congratulates-vilsack-chu/.

114 State of Oregon. (2008). "Energy Loan Program." Retrieved December 10th, 2008, from http://www.oregon.gov/ENERGY/LOANS/selphm.shtml.

of cash. This energy tax credit gives groups that build alternative-fuel plants in Oregon a great incentive when connected to the property-tax exemption allowed for renewable energy-development zone sites.115

Oregon residents get a $0.50 credit, up to $200 a year per vehicle for buying E85 or B99, thanks to Oregon Revised Statute 315.141, which is in effect from January 1, 2007 to January 1, 2013.116


64

115 State of Oregon. (2008). "Oregon Incentives and Laws; Biofuels Production Property Tax Exemption." Retrieved December 12th, 2008, from http://www.afdc.energy.gov/afdc/progs/view_ind.php/or/6273.

116 State of Oregon. (2008). "Oregon Incentives and Laws; Biofuels Use Tax Credit." Retrieved December 12th, 2008, from http://www.afdc.energy.gov/afdc/progs/view_ind.php/or/6272.

Venture Capitalist InvestmentVenture capital investment in the Cellulosic Ethanol Industry will change from research funding to commercial-scale plant funding. A senior advisor to the NextGen Biofuels Fund in Canada stated that second-generation ethanol (cellulosic ethanol) is headed “toward more of a project-financing culture, where they will need to adapt their modus operandi, partnerships and ways of doing business.”

Cellulosic ethanol companies have been able to take advantage of government grants, government guaranteed loans, and initial loan offerings because of the range of fuel stock that they can use verses the first-generation ethanol companies that mainly use food crops like corn and sugar. This puts companies like Range Fuels, BlueFire, Du-Pont’s Danisco, and Coskata in a much better financial position to receive venture capi-tol investment over the first-generation ethanol providers which have lost over $9 bil-lion in market value this past year. The federal government requirement of an addi-tional 21-billion gallons of fuel a year to come from cellulosic ethanol creates an incredi-ble opportunity for the industry that most venture capitalists realize.

The high cost of building a cellulosic ethanol plant is more than most venture capitalists have available. This cost challenge has kept one-quarter to one-third of the venture capital-backed cellulosic companies from building a plant.117 However, this has not kept them from investing in the booming industry, with $650 million invested from 2007 to the first-quarter of 2008. Investors in 2008 tended to lean towards companies that were in the process of building large commercially-viable sites.118 As the industry con-tinues to improve, however, investments will continue to rise.


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117 Buss, D. (2008, November 25th, 2008). "In the Background, Cellulosic Ethanol Moves Forward." Auto Observer Retrieved January 1st, 2009, from http://www.autoobserver.com/2008/11/in-the-background-cellulosic-ethanol-moves-forward.html.


The companies that were scaling up before the credit crunch are in a good position to succeed, unlike the ones that are still in the proving stages, which will find it increas-ingly difficult to get startup funding. Venture capitalists are most interested in compa-nies that have signed deals like the one Coskata has with the Sugar Industry in Clewis-ton, Florida. Todd Kimmel, a venture capitalist investor, states it best when he says, “Market correction has put a ceiling on, or at least [has] bound, how these companies can get to market.”119


66

119 Buss, D. (2008, November 25th, 2008). "In the Background, Cellulosic Ethanol Moves Forward." Auto Observer Retrieved January 1st, 2009, from http://www.autoobserver.com/2008/11/in-the-background-cellulosic-ethanol-moves-forward.html.

State of Oregon SupportGovernor Ted Kulongoski has set the tone for the state when it comes to biofuel produc-tion and retail sales. David Belyea, with Oregon’s DEQ office, has been instrumental in providing information for this report. He has been given the ability and resources to give support to any city, county, company, or organization that is interested in getting an alternative-fuel site in Oregon.

To help local jurisdictions with locating biofuel sites that do not fall under the Energy Facility Siting Rules, the Oregon Department of Energy has a Model Siting Ordinance that may be used to assist counties. The plan is a great resource for planning, permit-ting, and constructing small biofuel refineries. It includes guides for developers that help with planning, acquisition of permits, constructing, and operating the facility. In addition, a cellulosic ethanol plant that produces less than 28.8-million gallons a year is able to use one-stop permitting for the construction of the facility.120


67

120 State of Oregon. (2008). "Producing Biodiesel or Ethanol in Oregon." Retrieved December 10th, 2008, from http://www.oregon.gov/ENERGY/RENEW/Biomass/Producing.shtml.

Yamhill County SupportAfter the idea of bringing an alternative source of fuel to our county was shared with a couple of people a few months ago, the enthusiasm for the idea “spread like wild fire.” Emails and phone calls started pouring in, and local citizens asked how they could learn about this new concept and become involved. Several meetings have been hosted, since then, at homes, businesses, and through local organizations. Among the enthusi-asts are: business executives, engineers, plant operators, government officials, home-makers, general contractors, accountants, physicians, social workers, and teachers. People seem to be craving a new and better plan from which to ultimately obtain needed fuel—one that will cost them less and, more importantly, stimulate the economy while reducing our dependency on foreign oil and preserving our environment.


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How to Attract Alternative Fuel CompaniesFirst and foremost, establishing a task force to ensure success for a project of this size is vital to the process of attracting alternative fuel companies to our county. The task force is important in performing the following duties:

• Inform county officials and citizens about the dynamics of the project, and create an on-going plan for community awareness.

• Research the alternatives that would best serve our county—cellulosic ethanol, bu-tanol, biodiesel, hydrogen, battery, etc., and establish a plan for on-going research.

• Locate land for development. “Brown land,” not suitable for construction, is a per-fect site for alternative fuel plants. Work with the cities in the county that have this land available for development. Significantly less space is required for a plant than is needed for a landfill operation.

• Work with local businesses, such as logging companies and farms, that would bene-fit from a cellulosic ethanol plant. Have them help recruit an alternative fuel com-pany to build a plant in our county.

• Recruit and work with alternative fuel providers, like SeQuential Biofuels in Eugene, to build alternative fuel stations in Yamhill County.

• Encourage local gasoline retailers to offer alternative solutions.

• Ensure a quality sales plan that connects the plant with local retailers, such as fuel stations throughout Oregon.

Another way to attract alternative fuel companies would include awarding county tax incentives to both the plants and the local fueling stations that promote the use of alter-native fuels. These could come from grant monies available through the state and fed-eral government. A portion of the new stimulus package approved by Congress will be allocated to “green” projects of this nature. To gain access to these federal funds, timing is of essence for this project to move forward.


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Our county vehicles could also pave the way for attracting alternative fuel sources. As-suring that they are all flexfuel vehicles would not only set an example for our citizens but would secure the future of alternative fuel in our county.

Finally, a step that could prove most beneficial to Yamhill County’s future for alterna-tive energy sources is encouraging Waste Management to invest an interest in this pro-ject. Just as Waste Management has ownership with BlueFire in California, the com-pany could also lead the way for cleaner fuel in our county. Waste Management could be instrumental in converting municipal waste into cellulosic ethanol rather than build-ing an even larger mountain of trash, while enjoying increased profits. Citizens would benefit from lower fuel costs, the same or possibly decreased garbage rates, and a cleaner waste disposal system. Yamhill County would profit financially, as well, and become a leader in clean-energy technology throughout our state and country.


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ConclusionLet’s take one final look at the benefits of establishing an alternative fuel plant in Yam-hill County.

• Our farmland would be preserved since “trash-to-fuel” plants can be constructed on “brown” or useless land.

• The wood waste in our county accounts for 66-100 tons per day from April to No-vember, and this comes from just one of the more than ten logging companies in Yamhill County.

• The Logging Industry sees an immediate advantage to locating a cellulosic ethanol plant near their mills. Just in employment alone, a plant that produces 25-million gallons of fuel per year would bring in approximately 40 new Yamhill County jobs to the industry.

• The reduction in wood waste will prevent forest fires and decrease slash piling and burning, therefore reducing the amount of harmful gases released into our atmos-phere.

• The Riverbend Landfill is a great source for municipal waste to feed a cellulosic ethanol plant. According to 2007 figures, our landfill takes in more than 240,000 tons of waste per year from our county alone and an additional 360,000 tons per year from surrounding counties.

• A cellulosic ethanol plant would utilize municipal waste from the county for well over 50 years. Riverbend’s proposal will be at capacity in 20-30 years.

• Many experts from the Ethanol Industry suggest that tipping fees will decrease with competition from a cellulosic plant.

• With an expected operational income of $25 million from a cellulosic ethanol plant versus the current amount of $1.1 million from Riverbend Landfill, Yamhill County can expect a huge tax-base increase. Even considering Waste Management’s per-


71

sonal income from the creation of new jobs, along with that currently generated by the Riverbend Landfill, which totals $22 million, the ethanol plant still exceeds in to-tal income.

• Air emissions from hauling waste would be reduced, as the new site would focus on rail transportation in place of trucks driving through the county.

• Real estate values would increase as we would enjoy a healthier environment by having an alternative fuel plant that utilizes trash, creates no pollutants or odors, and encompasses a smaller area than what would be taken up by the proposed landfill.

• As it takes 4-5 years from conception to production for a cellulosic ethanol plant to generate income, acting now to ensure this change would replace our current waste site before it reaches capacity within seven years.

• America will be concentrating on green-energy production in the years ahead, and money will be available for this industry.

• The technology is not new. There are proven production sites throughout the world, and many large commercially viable sites currently under construction.

• The Renewable Fuels Association states in their September, 2008 Ethanol Production and Demand Report that ethanol demand continues to outpace production.

• There are over 7-million flexfuel vehicles on the road today that are fueling this de-mand, and U.S. automakers expect to produce another million+ flexfuel vehicles this year. By 2012, their goal is to make half of their products flexfuel capable.

Clearly, the benefits of establishing a cellulosic ethanol plant in Yamhill County are well worth the investment, especially when our federal and state governments will be allo-cating funds and awarding incentives for projects as this.


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73

AttachmentsA) Email from Wes Bolsen to Joshua Ferguson, with the BumperFuel Group, regarding slag and available feed-

stock.

From: "Wes Bolsen" <[email protected]>Subject: RE: Thank you

Date: January 16, 2009 8:03:38 AM PST

To: "Joshua Ferguson" <[email protected]>

When using MSW, the slag percent really depends on the material. Straight trash "as received"

could be as high as 30% . For comparison, wood biomass from trees is about 2%. So "sorted"

MSW down to construction and demo waste could be much lower cost and low on slag. Long

answer to "we can take in just about anything" including paint, toxins, etc. There are just different

capital cost assumptions to the process for handling.

The process works well on high BTU feedstocks. So what we really want is carbon in the

process. Tires, plastic bottles, and construction waste are possibly 3 of the best materials. We

need to reach 30 billion gallons though, and those things are only a piece.

Hope this helps.

Wes

Sent by Good Messaging (www.good.com)

-----Original Message-----

From: Joshua Ferguson [mailto:[email protected]]

Sent: Friday, January 16, 2009 08:11 AM Central Standard Time

To: Wes Bolsen

Subject: RE: Thank you

Wes,

Thank you for sending me the process video, it helped tremendously.

When giving the presentation I was asked a few questions that I could

not answer and had hoped you could help me. The questions are:

1. When using municipal waste as a feedstock, what is the estimated %

of "slag" that is left over using Coskata's process?

2. Can the Coskata system take in 100% of the waste, which often

includes batteries, paint and other hazardous materials or does it

need to be presorted?

3. Does the process work well with items that are low in cellulose?

The report and teaching that I have been doing around our county has

created great interest and has gotten our logging companies to ask me

about getting a plant in our county. Who at Coskata should I contact,

or who's name could I give these companies, that would allow them to

further investigate building a plant near their mills?

Sincerely,

Joshua Ferguson

Dundee, Oregon


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B) Letter to the Board of Supervisors of Los Angeles County from the Los Angeles County Solid Waste Man-agement Committee/Integrated Waste Management Task Force for the support of the BlueFire Cellulosic plants.

LOS ANGELES COUNTY SOLID WASTE MANAGEMENT COMMITTEE/

INTEGRATED WASTE MANAGEMENT TASK FORCE 900 SOUTH FREMONT AVENUE, ALHAMBRA, CALIFORNIA 91803-1331

P.O. BOX 1460, ALHAMBRA, CALIFORNIA 91802-1460 www.lacountyiswmtf.org

DEAN D. EFSTATHIOU CHAIRMAN

October 21, 2008 The Honorable Board of Supervisors County of Los Angeles 869 Kenneth Hahn Hall of Administration Los Angeles, CA 90012 Dear Supervisors: SUPPORT FOR BLUEFIRE ETHANOL PROJECT CONDITIONAL USE PERMIT NUMBER 2007-00137 On behalf of the Los Angeles County Solid Waste Management Committee/Integrated Waste Management Task Force (Task Force), I would like to express our support for the proposed BlueFire Ethanol Project in the unincorporated area of the Antelope Valley near Lancaster. On October 16, 2008, the Task Force unanimously voted to support the Project contingent upon the facility’s compliance with all rules and regulations established by federal, state, regional and local governmental agencies as well as receiving all necessary/applicable permits from these agencies. On July 23, 2008, the County Regional Planning Commission issued a conditional use permit for the proposed Project; subsequently, the Commission’s decision was appealed to your Board. It is anticipated that your Board will consider the appeal at your October 28, 2008 meeting. Your Board’s decision to uphold the Regional Planning Commission’s approval of the BlueFire Ethanol Project is important to maintaining the growing momentum for the development of safe, clean and renewable technology projects in California, which are vital to redeveloping our economy and meeting the new environmental challenges of the 21st century. Pursuant to Chapter 3.67 of the Los Angeles County Code and the California Integrated Waste Management Act of 1989 (Assembly Bill 939, as amended), the Task Force is responsible for coordinating the development of all major solid waste planning documents prepared for the County of Los Angeles and the 88 cities in Los Angeles County. Consistent with these responsibilities, and to ensure a coordinated and cost-effective and environmentally-sound solid waste management system in Los Angeles County, the Task Force also addresses issues impacting the system on a Countywide


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The Honorable Board of Supervisors October 21, 2008 Page 2 basis. The Task Force membership includes representatives from your Board, as well as the League of California Cities-Los Angeles County Division, the City of Los Angeles, the waste management industry, environmental groups, the public, and a number of other governmental agencies. Conversion technologies, such as the BlueFire Ethanol Project, are state-of-the-art processes that have the ability to convert source-separated or post-recycled residual waste and turn it into marketable products, biofuels, and renewable energy. In addition, conversion technologies have the capacity to reduce the need for landfills, decrease net air pollutant emissions (including greenhouse gas emissions), move us towards energy independence, and produce high level "green collar” jobs. Currently, there are over 140 conversion technology facilities successfully operating in Europe, Japan and elsewhere, utilizing a variety of processes (thermal, chemical, and biological). The Task Force, along with your Board, has been a consistent supporter of conversion technologies for nearly a decade, working to increase local support and awareness, as well as promoting scientific research and development of conversion technologies through a variety of means. For example, the Task Force in concert with your Board, has advocated and supported legislation to spur the development of these technologies, formed the Alternative Technology Advisory Subcommittee (a panel of experts from around the State with special knowledge and interest in this field), and is currently working with the County of Los Angeles to develop one or more conversion technology demonstration facilities in Southern California. The BlueFire Ethanol Project utilizes a proprietary chemical and biological process to convert local source separated and/or post-recycled solid waste residuals such as green waste and wood waste into ethanol. BlueFire is attempting to capitalize on the growing demand for ethanol in California since the state uses approximately one billion gallons of ethanol per year, which is primarily blended into gasoline to reduce smog. In comparison, ethanol that is imported from the Midwest is formulated from large quantities of corn, consuming a valuable food resource rather than utilizing waste materials that would otherwise be disposed. Because the BlueFire Ethanol Project has the potential to revolutionize the way we manage solid waste (turning a liability into a resource with its operation subject to full compliance with all strict air, water and environmental regulations and standards), the Task Force supports the Project. If additional review of the BlueFire Ethanol Project is needed as the project develops, the Task Force would be available to work with the local community while volunteering the Alternative Technology Advisory Subcommittee’s expertise to assist all regulatory agencies having direct oversight of the Project.


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The Honorable Board of Supervisors October 21, 2008 Page 3 If you have any questions, please contact Mr. Mike Mohajer of the Task Force at (909) 592-1147, or you may contact me at (626) 288-7308. Sincerely,

Margaret Clark, Vice-Chair

Los Angeles County Solid Waste Management Committee/ Integrated Waste Management Task Force and Council Member, City of Rosemead

CS:pa

cc: Each Member of the Los Angeles County Regional Planning Commission Each City Mayor in the County of Los Angeles Southern California Association of Governments South Bay Cities Council of Governments San Gabriel Valley Council of Governments Gateway Cities Council of Governments Association of Rural Town Councils Los Angeles County Chief Executive Officer Los Angeles County Department of Regional Planning

Each Member of the Los Angeles County Integrated Waste Management Task Force Each Member of the Task Force’s Alternative Technology Advisory Subcommittee Each City Recycling Coordinator in Los Angeles County


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C) Email from Matthew Glass to Joshua Ferguson, with the BumperFuel Group, regarding the description of the emissions from the PEM process.

From: "Matthew B. Glass" <[email protected]>Subject: RE: Emission from production process

Date: January 29, 2009 12:40:06 PM PST

To: "Joshua Ferguson" <[email protected]>

Hi Joshua;

The PEMTM process is very clean with respect to pollution and dependingupon the use of the syngas produced, can have very low overallemissions. Prior to any such use, the gas is put through a gas cleaningsystem to scrub out and remove virtually all items of concern. Theseemissions have been demonstrated in numerous tests to meet or exceedstandards. You can find a number of links to the reports from these testson our website, using the link: http://www.inentec.com/certifications.html Regarding mercury, there are mercury capture filters in the gas cleaningsystem. Plastics and other organic chemicals are broken down into their

elemental components, due to the high heat in the PEMTM processchamber. The organic fraction of the waste is reformed into the syngas,while the inorganic portion is incorporated into the glass material, which hasbeen demonstrated to be leach-resistant in testing; thus no materials in theglass will migrate out of the glass into local water supplies or elsewhere. I hope that helps.

!

Regards,Matt Glass

!

-----Original Message-----From: Joshua Ferguson [mailto:[email protected]] Sent: Wednesday, January 28, 2009 5:49 AMTo: Matthew B. GlassSubject: RE: Emission from production process Matthew, There is a citizen group (Citizens Against Toxins) located in an


78

adjacent county (Marion) that have deep concerns about pollution from the production process so I am going to have a separate section in the report, I am writing for our county, and was hoping for your help in the matter. What pollutants does the PEM process produce? How does it deal with mercury, medical plastics and other harmful chemicals? Sincerely,Joshua FergusonThe Bumper Crop Group(503) 537-2131


79

D) Email from Mike McKenzie-Bahr to Joshua Ferguson, with the BumperFuel Group, regarding the Lane County alternative fuel project.

Monday, February 23, 2009 4:46 PM

Page 1 of 2

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Hello Joshua(My answers are in blue. I hope this helps.(((

1.How many acres is the site dedicated to alternative fuel production? 3 acres of 10 acre project site 2. What was the site previously? - vacant land ! 3. Where is it located in Lane County? inside the UGB of Junction City 4. What has the county done to create interest from alternative fuel producers? 2 years of outreach via private meetings and public meetings 5. Are there any prospective clients? Yes 6. What issues have come up when designating the land for an alternative fuel site? Local and state permits. Not yet resolved 7. Is the county charging the alternative fuel companies for the land or are they offering the site at no charge to encourage building of a plant? - We are still negotiating with the municipal owner. We think it will be low cost, rather than no cost 8. Did you get or do you anticipate getting any federal or state financial assistance for this project? Yes for the studies. We also anticipate funding for construction ((

Mike(

!

(

From: Ferguson Joshua [mailto:[email protected]]

Sent: Sunday, January 25, 2009 11:24 AM

To: MCKENZIE BAHR Michael H

Subject: <no subject> (Mike!!

Thank you for you help as we try to get our County Commissioners to follow Lane County's lead in opening up land for an alternative fuel site. You are one of the last pieces we need to finish the report.!


80

of 2

My first round of questions to you are: 1. How many acres is the site dedicated to alternative fuel production? 2. What was the site previously?! 3. Where is it located in Lane County? 4. What has the county done to create interest from alternative fuel producers? 5. Are there any prospective clients? 6. What issues have come up when designating the land for an alternative fuel site? 7. Is the county charging the alternative fuel companies for the land or are they offering the site at no charge to encourage building of a plant? 8. Did you get or do you anticipate getting any federal or state financial assistance for this project? Sincerely, Joshua Ferguson 770 SW Scotsman Ct Dundee, Oregon 97115 (503) 537-2131!!


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E) Email from Scott Robinson to Joshua Ferguson, with the BumperFuel Group, about alternative waste project for Portland, Oregon.

From: Scott Robinson <[email protected]>Subject: RE: Alternative waste project for Portland


To: Joshua Ferguson <[email protected]>Cc: Paul Ehinger <[email protected]>

1 Attachment, 3.2 MB

Joshua,

We are just beginning to research and update our information set regarding wasteto energy. Recently our regional Council members have been inspired by policiesand practices in Sweden and Denmark. As such, we are just beginning to look atlong range options that would allow us to consider moving toward long run goal of0% landfill. We have not adopted this as a policy goal at this time, and are onlyexploring the state of the technology to gain a sense of the feasibility. As you maybe aware, the technological advance in the industry has not been as significant inthe US as elsewhere. There appear to be two basic models that work in the US.Old style waste to energy based upon burning garbage. The Covanta plant inBrooks, Oregon is a representative type of plant for this style.

http://www.covantaholding.com/ (general info)

http://www.covantaholding.com/site/marion/covanta-marion.html (Brooks OregonFacility).

Alternatively, there are various waste to fuel technologies, all of which require aspecialized waste stream. For example, there are various technologies which seekto convert waste to either a gas (methane) or liquid (petroleum) product. The laterrequires specific plastic wastes to be separated from the stream. Plas2fuelrepresents one of several technologies seeking entry to this market. They have apilot plant in Brooks, Oregon as well. I've attached an overview of their businessmodel.

http://www.plas2fuel.com/

I have included Paul Ehinger, SW Operations Manager in this correspondence,since he will be able to steer you towards previous study work that has beenconducted by Metro.

-----Original Message-----From: Joshua Ferguson [mailto:[email protected]]Sent: Wednesday, January 07, 2009 3:44 PMTo: Scott RobinsonSubject: RE: Alternative waste project for Portland


82

Scott,

Currently I am building a report for the Yamhill County Commissionersabout the need to set aside land for an alternative fuel company withthe hope that we will attract a trash to energy company. I understandthat you are someone who is active in trying to find an alternativefor waste in Portland and was wondering if I could ask you somequestions regarding it?

My questions include:1. At what stage is the city of Portland on this project?2. What are the general goals?

Thank you,Joshua Ferguson(503) 537-2131

Plas2Fuel Pr….ppt (3.2 MB)


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F) Email from Bill Davis to Joshua Ferguson, with the BumperFuel Group, about pollution from a BlueFire facil-ity.

From: "William Davis" <[email protected]>Subject: Pollution from production


To: <[email protected]>Cc: "'Rigel Stone'" <[email protected]>, "'Necy Sumait'"

<[email protected]>

2 Attachments, 5.8 KB

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38986(;7;(=447(31$""6This email and any files transmitted with it are confidential and intended solely for the useof the organization or individual to whom they are addressed. It is expressly forbidden toretransmit or copy email and/or this attached files without our permission . If you are notthe addressee indicated in this message (or responsible for delivery of the message tosuch person), you may not copy or deliver this message to anyone. In such case, youshould destroy this message and kindly notify the sender by reply email. Please adviseimmediately if you or your employer does not consent to Internet email for messages ofthis kind. Opinions, conclusions and other information in this message that do not relateto the official business of my firm shall be understood as neither given nor endorsed by it.

! Please consider the environment before printing this e-mail.

!

!


86

G) Email from Carryl Dazey at A1 Logging.

From: "Carryl Dazey" <[email protected]>Subject: For you

Date: February 3, 2009 1:40:23 PM PST

To: "Bumpercrop" <[email protected]>

Here are some answers for you: 1. What would be considered logging waste?

Any wood that does not or can not make a saw log.Wood that is: Under 5” Over 22” in some cases Has defect or rot Is split or shattered from the falling Crooked, or in need of a clean butt cut

2. How is this waste made?

In the falling or logging process some wood is not of desirable quality tomake lumber and is left behind as unused or wanted waste.There are tops and bottoms of trees, limbs and broken parts. Log millswant only the highest of quality from the timber (wood) sent to them.

3. How many tons of this waste does Yamhill County have per day?As a single company we produced 66 to 100 tons per day from April toNovember. There are as many as 10 to 12 companies our size in thisarea.

4. How many tons of this waste does the state of Oregon produce?An astounding amount. Currently wood remains in the woods.

5. What are the fiscal advantages for logging companies to send waste outvia a CE plant vs what they currently do?Jobs, Income, fire fuel reduction, less burning is allowed each year, lessslash piling, possible fuel tax credits towards biofuel to run log trucks,home heating oils production, electrical production, use of closed andunused lumber mills. The list goes on, most of it benefiting the countiesincome levels.

6. Is there a website or document I can find this data along with what youcan provide through this email?Oregon State University has a wonderful program linked to the forestryindustry. I recently found an article in the Oregon Small WoodlandsOwners publication regarding a portable, take to the woods CE (homeheating oil) project in Douglas county. www.oswa.org./update I bet you


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know more of the places to find this info than I do.

7. Is there a time I can come out to A1 Logging to get a picture of thewaste? I would love to show you the report, minus the logging info, atthat time.Larry said yes, please give him until Thursday and then give him a callearly in the morning to check his schedule. 503-434-3136

A1 Logging Inc503-852-7733503-852-7913 Fax


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H) Email from Jeffrey Surma to Ramsey McPhillips about InEnTec's PEM process.

5 9 5 S W B L U F F D R., S U I T E B, B E N D, O R 9 7 7 0 2

December 18, 2008

By Email

Mr. Ramsey McPhillips

Protect Agricultural Lands (PAL)

McMinnville, OR

Dear Mr. Ramsey:

On behalf of InEnTec, it is our pleasure to respond to your questions on our technology.

First let me provide you with some background on InEnTec. InEnTec LLC was formerly known

as Integrated Environmental Technologies LLC. InEnTec’s unique technology has grown out of

research conducted at the Pacific Northwest National Laboratory (PNNL) in Richland,

Washington and the Plasma Fusion Center at the Massachusetts Institute of Technology (MIT).

That research resulted in the development and commercialization of a unique patented

gasification system that converts almost any type of biomass or waste material into clean energy

and other usable products (including ethanol, methanol, synthetic diesel, hydrogen, and electric

power) with minimum environmental impact. InEnTec’s branded gasification system is called

the Plasma Enhanced Melter™ or PEM™. The PEM™ process addresses two of the most

significant global trends which affect industry and society: (1) the push for a reduction in global

environmental impacts (including hazardous and greenhouse gas emissions), and (2) the drive for

a sustainable global energy future.

* * *

Following are answers to your questions:

Question: How big is the footprint of your operation? Can it be placed on industrial

land or does it need a large agricultural (EFU) footprint?

Answer: A facility handling 150,000 to 600,000 tons/year would ideally need

approximately 20 to 30 acres of land, but less land may be needed if the PEM™ plant were to be

co-located with existing facilities. We would prefer to locate on industrial land or to co-locate at

an existing landfill or transfer station rather than on agricultural land.

Question: What is the minimum tonnage that is required to make your facility viable?

Voice (541) 749-2114 Fax (866) 393-0231 Email [email protected] Web www.inentec.com

IInnEEnnTTeecc LLLLCC


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December 18, 2008

Page 2 of 3


Answer: 250 tons/day of municipal solid waste (“MSW”) or larger.

Question: Has your PEM ever replaced a landfill? Is the intent of this proven and fully

operational system to replace the landfill model?

Answer: Not yet. We recently announced a facility that is going to be operational in

2010 to be located near Reno, Nevada and that facility will require 18 to 24 months to construct.

InEnTec has deployed smaller plants that have been used for processing special waste materials

such as chemical and medical waste.

Question: Does your facility cause nuisance to nearby land? How big of a land buffer

would be required?

Answer: There will be no nuisance to nearby land, and no particular buffer is required.

Question: Is there any detectable smell, noise or sight pollution associated with the PEM

process?

Answer: The facility does not have any equipment that will produce loud noise, odors or

cause other nuisance that would be any different from an operating landfill. In fact, it will likely

dramatically reduce odors.

Question: Does your operation produce Green House gas? Are there leaks of Methane

associated with the PEM process?

Answer: The PEM™ process will greatly mitigate greenhouse gas emissions by

converting waste into useful products rather than allowing that waste to degrade into landfill

gases (i.e. methane and carbon dioxide) which are emitted to the atmosphere from a landfill even

with the best landfill gas recovery systems in place. A PEM™ unit itself has no direct air

emissions. It produces a clean synthesis gas (“syngas”) as the primary product. That clean

syngas can be used to produce products such as ethanol, methanol or synthetic diesel. Although

the PEM™ unit has no direct emissions, the downstream conversion processes and other utilities

at a PEM™ facility would have air emissions consistent with any other cellulosic ethanol

facility, which are very low.

Question: Could the PEM system help supply 25% of Yamhill County’s green energy

that is mandated by our current Governor by the year 2025?

Answer: Yes.

Question: How long does it take to go from ground breaking to melting and producing

fuel? Could your facility be up and running by 2014?

Answer: 18 months. A facility could be built by 2014.


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December 18, 2008

Page 3 of 3


Question: Would the InEnTec system cause our garbage rates to go up substantially?

Would the resulting tipping fees be equal or less than the state average?

Answer: We would expect tipping fees to be similar to or less than those currently

charged in the state.

Question: Are there state or Federal incentives in place to help finance the PEM system?

Answer: There are a number of incentives, but their availability would depend on a

number of factors related to the project. In addition, depending on the final project parameters,

InEnTec would typically be willing to build (with available incentives), own and operate the

facility itself, so your community would not necessarily be required to pay for the entire system.

Question: Are there direct financial gains to be had by the PEM system?

Answer: As stated in the prior response, we would initially propose that InEnTec would

build, own, and operate the PEM system, so your community would not need to worry about the

financial aspects of operation, other than the payment of tipping fees and any other agreed upon

arrangements.

Question: Is InEnTec willing to propose an alternative system to Yamhill County to

replace our solid waste disposal system that will last longer than 20 to 30 years?

Answer: Yes.

* * *

If you have any further questions, please do not hesitate to call.

Best regards,

Jeffrey E. Surma


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I) A letter from David Wu regarding the alternative fuel industry.

DAVID WU

WASH NGroN, OC 20515-3702TELEPHoNE: 1202) 225 0355

620 SolrHwEsr MaN SrnEEr

PoRTLAND, OF 97205TF!ePHoNE: (503) 326-2901

(300)422 4003

@ongredd of tUo @nits! Statesbonst of l&epogontetibes@adtinqton, @@ 205t5*3701

November 21, 2008

Mr. Joshua Ferguson770 SW Scotsman CtDundee, OR 97115-9542

Dear Mr. Ferguson:

Thank you for contacting me regarding your support for altemative energy sowces,including trash to fuel technologies, and for your idea to bring a cellulosic ethanol plant toOregon. I appreciate knowing your thoughts on this important issue.

Over a third ofeverything the average person throws away is waste paper made up ofcellulose, a material which can be converted into cellulosic ethanol. The environmental impactofconverting simple tash into ethanol would be a boon to energy, landfill and environmentalissues. The possibilities in this type ofresearch and development are an important part ofensudng that America moves closer to its image ofa green economy.

Coskata and Bluefire are both examples ofethanol endeavors to help with our energy andenvironmental crises; being a safe and environmentally friendly way to turn tash (along withwood and agricultual residues and biomass crops) into fuel that has less ofan adverse impact onthe environment than fossil fuels. It works by converting the residues, cellulose and biomass to as).nthesis gas, which is femented into ethanol, and then sepaxated into useable fuel. processeslike these have nascent indust es that should be cultivated with Energy Production Tax Credits(PTCs) like those conrirued in H.R. 1424, the Emergency Economic Stabilization Act of2008.This act was signed into law on October 3rd, 2008 and serves to extend PTC'S in areas like wind,solar, biomass, and the investment in creating new technologies like fuel cells a.nd small turbinewind generation.

H.R. 1424 also provides a tax credit to businesses (e.g., gas stations) that installaltemative fuel pumps, such as fuel pumps that dispense E85 fuel in order to make it easier forthe consumer to locate a retailer ofaltemative fuels. The bill would create tax credits for theproduction ofcellulosic ethanol, making it more affordable to create options for custome$ topuchase bio-fuels for cars, trucks, home heating, and even aviationjet fuel. This incentive isimportant for power companies that wish to invest in renewable energy generation, but cannotalIord it.

ln addition to having voted for the PTC'S contained in H.R. 1424, I have also sponsoredlegislation on focusing research towards a green transportation inftastructue. H.R. 5161 wouldcreate centers focusing on green tanspoiation infrastructure in regions around the U.S. Thesecenters would develop innovative tansportation infrastructure technologies that mitigate

CMnMAN, r{ f l o@oY^No hrovaro!


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Mr. Joshua FergusonNovember 21. 2008Page 2

environmental impact. They would also encouage gove!runents to adopt these technologies andintegrate them into existing inftastructue though technology tansfer programs. Unfortunately,Congress was not able to vote on this legislation before the end ofthe yeax, but I will continue topush for this program and others like it in the next session.

Tax incentives and inftastructure progmms for green economy initiatives arecommonsense and will directly benefit this country's movement toward an economy focused onproducing new technologies and renewable energy production. Thank you again for contactingme on this important issue, and if I can be ofany additional assistance, please call me at 503-326-2901. ot 800 - 422-4003.

DW: NTMember of Congress


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T H E B U M P E R F U E L G R O U P

7 7 0 S W S c o t s m a n C o u r t D u n d e e , O R 9 7 11 5 • Te l e p h o n e : 5 0 3 . 5 3 7 . 2 1 3 1 • w w w. B u m p e r F u e l . o r g

cellulosic ethenal report for yamhill county

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