The Spirit of St. Louis

July 20, 2007

BY Michael Shirek

What started as a trickle has become a flood.

The 2007 International Fuel Ethanol Workshop & Expo (FEW) opened June 27 in St. Louis, Mo., with a general session unlike any before. A sea of chairs spread across the floor of the Edward Jones Dome, ready to accommodate the largest FEW crowd to date. When the empty seats were replaced by FEW attendees, the scope of the venue didn't go unnoticed by Mike Bryan, CEO of BBI International, which hosted the event. "I know many of you have heard over the last few days and over time, how the Fuel Ethanol Workshop has grown in size," Bryan told the general session crowd extending from the stage near the middle of the dome to the arena entrances in the distance. "You know, the first Fuel Ethanol Workshop was held here in St. Louis in 1984. I think there were between 38 and 40 people at that first Fuel Ethanol Workshop, and no exhibitors. This year we have about 5,200 registered … and nearly 700 exhibitors."

The manifold increase in the number of attendees mirrors the growth in the ethanol industry. The 40 attendees in 1984 represented an industry that produced less than 500 million gallons in the United Sates. Many of the nearly 5,400 gathered this year come from a domestic ethanol industry that is expected to produce 7 billion gallons of ethanol from grain feedstocks in 2007 and is working feverishly on the next generation of ethanol from cellulose feedstocks.

Renewable Fuels Association President and CEO Bob Dinneen brought excitement and optimism to the stage as he stood before many of the people he represents in Washington, D.C. "I've said it before and I'll say it again," he said. "We will be unrecognizable as an industry five years from now, because we're certainly unrecognizable from what we were five years ago. And the changes that are coming to our industry are all for the better."

The changes to the industry in the past calendar year included the rising cost of building ethanol plants, the spike in corn prices and the phasing out of methyl tertiary-butyl ether from the gasoline supply in the United States. Although the industry is dynamic, there is one change in particular that Dinneen would like to see come to fruition: widespread availability of E85. "The oil companies like ethanol as a blend component, in a way they can use it, they can control it," he said. "They're not real wild about E85, but that's OK. We're going to get there, too. We're going to build beyond just being a blend component in gasoline."

The E85 issue is a bit of a which comes first the chicken or the egg dilemma because more E85 fueling stations are needed to supply consumers across the United States and more flexible-fuel vehicles are needed to ensure a demand for more E85 stations. However, Dinneen believes that where there's a will in Washington, there's a way to get the job done. "The oil companies will—by hook or by mandate—get to the point where they're putting in the infrastructure for that refueling. We will get there, but there will be challenges before that."

Industry challenges were a recurring theme throughout the general session and the FEW as a whole. The push to bring cellulosic ethanol from pilot and demonstration to commercial-scale production has been on the front burner for some time now. The joke within the industry is that cellulosic ethanol has been "five years away" from reality for the past 25 years. Whether the next five years of research and development will deliver commercial-scale cellulosic ethanol is yet to be determined.

Gerald Tumbleson, chairman of the National Corn Growers Association (NCGA), told the crowd that the state of the ethanol industry has been a long time in the making. "We drove those gasohol cars and tried to get things moving back in the early '70s and even before that. [We] couldn't get it done because the 20th century was a hydrocarbon economy," he said. "The 21st century will be a carbohydrate economy."

Countering the Critics
One symptom of the ethanol industry's rapid growth has been a higher profile in the American press and public. Although it's currently enjoying a great deal of cheerleading from politicians on both sides of the aisle, ethanol producers also have a fair amount of detractors. The most heavily debated topic by ethanol opponents is the so-called food versus fuel debate. With demand for corn being augmented by the ethanol boom, rising prices for the commodity have led some to question the value of fuel ethanol given its effect on the food market.

"The food versus fuel discussion that we're hearing today, we need to address head-on," Dinneen said. "We need to be the ones to inform people that when we process corn into ethanol, we're not taking food out of the mouths of babies. We're borrowing the starch and we're leaving behind a very high-value, high-protein feed product that is going to those food markets."

Dinneen went on to explain that high-priced gasoline has a much greater impact on consumer food prices than a bushel of corn. "You buy a box of Special K in the grocery store, it's five cents of a bushel of corn in that box. All the rest is packaging, marketing, transportation—which is all impacted by the price of oil," he said.

The trigger-happy reporting on ethanol's devastation of the food market also hasn't gone unnoticed by the NCGA chairman. "In 2005, the newspapers said cheap corn was causing obesity," Tumbleson said. "In 2006, high-priced corn was causing starvation. Interesting, isn't it? We flip around like that. A vision is longer than a month, two months, six months or five years."

Bryan commented on both the food versus fuel debate and recent studies indicating that ethanol is not energy efficient and that burning it is more harmful to humans than burning gasoline. "All of this growth … has been in spite of a lot of negative newspaper articles, a lot of negative press, naysayers, the professor [David] Pimentels of the world who offer nothing but hollow criticism based on poor data, based on a lack of research," he said. "I want you to ignore the naysayers. I want you to laugh at the negative news articles that may appear in the paper. And I want you to totally ignore the paid-for professors who claim to know more about this industry than you do, because you know what? They are wrong. You are doing the right thing. The more noise that these people make, the more I'm convinced that you are doing the right thing."

Environmental Impact
Although ethanol's rising star is hitched to the promise of a renewable energy future, the industry can be doing more to cement its position in America's fuel tanks in years to come. Keynote speaker Karen Coshof isn't an expert on climate change she's simply a messenger with a powerful medium. The producer of "The Great Warming" (a television mini-series and later a feature film about climate change), Coshof is president of Stonehaven CCS Canada and executive vice president of Stonehaven Productions. Her message to the crowd at the FEW was simple: climate change is happening now. Burning fossil fuels, agriculture and changes in land use are the biggest man-made factors contributing to the warming of the planet and the ethanol industry can help address all three. The first step is to recognize the problem for what it is. "We began as we always begin," Coshof said of the "The Great Warming" genesis, "with research. And the more I learned, the more worried I became. Why wasn't this issue at the top of the political agenda? Why didn't the public seem to know more about it? And more to the point, why whenever the issue was raised, was it framed as a debatable, unproven theory?"

The answer, Coshof contends, comes in the form of disinformation campaigns from those profiting from current energy use and the media giving access to unqualified dissenters. The cloud cast over the debate proved to be a hurdle for Stonehaven Productions. Of the more than 100 corporations Coshof contacted to sponsor the mini-series, only Swiss Re—the world's largest reinsurance company—agreed to provide support. Once "The Great Warming" was broadcast, public response was overwhelming but political response was lethargic. "Why has it been so tough?" Coshof asked. "The answers, I think, are inertia, complexity, ignorance, fear [and] lack of leadership." The reasons for the resistance, she said, have nothing to do with the facts.

In the past 400 years, Coshof said the Earth has had four significant climate transitions. Included in that time span were four ice ages and four interglacial periods. Our current situation would be a normal interglacial period with an increase in temperature if not for the greenhouse gases we've produced. As it is, the current accelerated rise in temperatures is anything but normal.

"Naysayers in climate love to point to natural causes for the present warming," Coshof said. "That, I think, is the ostrich effect at work. Yes, certainly solar variability plays a role. And yes, certainly other natural cycles and geochemical phenomena play a role. But no, they are not the reasons behind the abnormal acceleration we're observing. We are the reason. Human activities that create excess greenhouse gases … are the primary cause of our surface temperature warming." Fifty percent of the temperature increase is a direct result of human activity, Coshof said. "By sector, land use change and modern agriculture account for about 31 percent, transportation another 13 [percent]," she said. "And all three of these, of course, involve you."

That fact has not gone unnoticed by the industry. "As fuel policy is debated in Washington, D.C., today, it is evolving and you will likely see a great deal more attention paid to carbon," Dinneen said. "The House Energy Committee, when they introduced a comprehensive energy bill a few weeks ago, had a low-carbon standard as part of it. Now, nobody really knows what it means, and nobody knows how to measure it and nobody knows how to implement it. But they know that that's where they want to get to."

Dinneen challenged the industry to understand what their carbon footprint is and to develop and adopt technologies that will reduce that footprint. "Because whether the Congress does it or the market creates it, there will be opportunities for low-carbon fuels in the future and ethanol will have a very important role," he said.

State of the Industry
If the record attendance at the FEW is any indication, the continued growth in ethanol points to more than just a niche industry or a boutique fuel. "You represent a stronger economy—not only just the rural economy, but you represent a stronger economy in general," Bryan said. "You also represent energy independence and energy security. And you represent a cleaner environment. And probably as important today as it has ever been in our lives, you represent a safer world."

Dinneen summed up the current state of affairs this way: "Today, ethanol is blended in 50 percent of the nation's fuel. Every single gallon of gasoline sold in New York is blended with ethanol. Every single gallon of gasoline sold in California is blended with ethanol. Every single gallon of gasoline sold in Houston, Texas, where big oil company executives have to drive to work every day on your fuel, is testament to how far we've come. But we certainly have a long way to go."

Michael Shirek is the Ethanol Producer Magazine online editor. Reach him at mshirek@bbibiofuels.com or (701) 746-8385.

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