The World's #1 Renewable Energy Network for News, Information, and Companies.

DSM to Make Biofuel by July as US Considers Cutting Renewable Fuel Standard

DSM to Make Biofuel by July as US Considers Cutting Renewable Fuel Standard

Royal DSM NV, the world’s largest vitamin manufacturer, expects to begin producing cellulosic ethanol in the U.S. by July as the government considers reducing the amount of renewable fuel that oil companies will be required to buy.

The $250 million plant in Emmetsburg, Iowa, is a joint venture with ethanol maker Poet LLC and will produce about 12 million gallons (45 million liters) this year, DSM Chief Executive Officer Feike Sijbesma said today. It will be able to make about 20 million to 25 million gallons annually and will reach full production by the end of the year.

Demand for the fuel is driven in part by U.S. Environmental Protection Agency requirements that gasoline companies blend biofuels into their products. Those mandates increase annually while U.S. gasoline consumption is declining. As a result, the biofuel percentage in each gallon of fuel is rising, and is approaching the 10 percent level that refiners and automakers say may damage engines. The EPA in November proposed lowering the rate, a change DSM said is unnecessary.

“We think that principle is fundamentally flawed,” Hugh Welsh, the Heerlen, Netherlands-based company’s president for North America, said today in an interview at Bloomberg’s headquarters in New York. “The blend rate should not be tied to 10 percent.”

There’s no reason a 10 percent ethanol blend can’t be used in U.S. vehicles, and fuels with as much as 15 percent ethanol have been extensively tested, Welsh said.

EPA Requirements

The Emmetsburg plant will turn corn waste into cellulosic ethanol. That’s considered a second-generation biofuel, an evolutionary step beyond fuel produced from food crops such as ethanol from corn and sugar cane. DSM makes a broad range of chemicals, including enzymes used in food production and biofuels.

Under the U.S. Renewable Fuel Standard, gasoline and diesel producers are required to blend 36 billion gallons of biofuel a year into their products by 2022, including 16 billion gallons of cellulosic fuel.

Oil companies have urged lawmakers to revise or repeal the policy as more efficient vehicles and consumers’ shifting driving habits eat into gasoline consumption.

Those rates were set in 2007, and in November the EPA proposed lowering the 2014 mandate to 15.21 billion gallons, from 18.15 billion gallons under the original schedule. The new rate includes 17 million gallons of cellulosic biofuel.

“The Renewable Fuel Standard will play an important role in the market,” Sijbesma said. Shifting mandates make it difficult to forecast demand, and DSM is seeking “a consistent RFS policy.”

The EPA expects to make a decision on the 2014 blend requirements by June, its administrator Gina McCarthy said today.

Copyright 2014 Bloomberg

Lead image: Biofuel via Shutterstock

RELATED ARTICLES

Stock graph

Green Bonds Sprout as Wall Street Embraces Renewable Energy Debt

Cordell Eddings, Bloomberg Bonds backing clean energy and other sustainable initiatives are booming. Investors are snapping up green bonds at the fastest pace on record, as big banks like Morgan Stanley and Bank of America Corp. pile in with new iss...
MIT Clean Energy Prize

MIT Clean Energy Prize Awards $400,000 to Energy Efficiency, Renewable Ventures

Eric Kirchblum, MIT Earlier this month, the MIT Clean Energy Prize (CEP) announced the winners of the 2015 competition at the Eversource MIT Clean Energy Prize Showcase & Grand Prize Awards Ceremony, where it awarded over $400,000, includ...

The Big Question: What Is the Most Frustrating Part about Working in Renewable Energy?

Renewable Energy World Editors

Every industry has its challenges and misunderstandings. Sometimes the obstacles we face in simply trying to do our jobs can be very frustrating.

Norway and Sweden flags

Nordic Renewables Boom Set to Exceed Wind Energy Target

Jesper Starn, Bloomberg

Sweden and Norway will probably exceed a joint target for renewable energy production by the end of the decade, industry consultant Nena AS said.

CURRENT MAGAZINE ISSUE

Volume 18, Issue 3
1505REW_C11

STAY CONNECTED

To register for our free
e-Newsletters, subscribe today:

FEATURED PARTNERS



EVENTS

Mastering RETScreen® 4 for Clean Energy Project Analysis

Hands-on modeling class using RETScreen 4. Michael Ross designed this co...

CIREC WEEK

Chile is still considered to be one of the world’s hottest m...

Renewables and Mining Summit and Exhibition

African mining leaders are seriously exploring new energy solutions to s...

COMPANY BLOGS

Substrate Feeder for Biogas Facilities

RUD manufactures complete, ready-to-use conveyor systems for transportin...

US Energy Grid Review Finds Needed Upgrades Would Allow More Solar,...

Yesterday (April 21) the U.S. Department of Energy released the first Qu...

Clean Energy Patents Rise in 2014, Solar Tops others, Toyota and GM...

U.S. patents for Clean Energy technologies in 2014 were again at an all ...

SOCIAL ACTIVITY

Tweet the Editors! @megcichon @jennrunyon

NEWSLETTERS

Renewable Energy: Subscribe Now

Solar Energy: Subscribe Now

Wind Energy: Subscribe Now

Geothermal Energy: Subscribe Now

Bioenergy: Subscribe Now  

 

FEATURED PARTNERS