xcel
08-05-2006, 06:52 AM
What makes sense in Mississippi is our soybeans can be used to make biodiesel. (http://www.clarionledger.com/apps/pbcs.dll/article?AID=/20060805/BIZ/608050345)
Jack Mazurak – Clarion Ledger – August 5, 2006
http://www.cleanmpg.com/photos/data/501/Bio-Willie.jpg
Vickie D. King/The Clarion-Ledger - The BP station at the I-55 North Coffeeville exit offers biodiesel marketed under entertainer Willie Nelson's brand called BioWillie.
As the state looks to add businesses to its portfolio and oil prices show no signs of dropping, several experts said Mississippi would be better off producing biodiesel than ethanol, the alternative fuel garnering more legislative interest.
The two alternative fuels are the country's most immediately promising, and industries for both are gaining footholds in Mississippi. In the marketplace they don't compete against each other - one runs in gasoline engines, the other in diesel - but biodiesel seems the better fit from an economic standpoint because of proximity to feedstocks and the variety of Mississippi's crops.
Ethanol is an alcohol distilled from corn, sugarcane or other plant matter. It's most often blended with 15 percent gasoline to make E85, an alternative fuel that can be run in some gasoline-engine cars.
Although corn is a sizable Mississippi crop, farmers in the state use more than what's grown. So ethanol production would depend, at least for its start-up years, on imported corn, which would raise the cost of production.
Biodiesel, on the other hand, is brewed from animal fats, soybean oil or other oil-producing crops. If properly made, it can be used in nearly any diesel engine in pure form or at any percentage blend with petroleum diesel.
"What does make sense in Mississippi is our soybeans can be used to make biodiesel. Frankly, there can't be enough grown in Mississippi to satisfy our need," Bill Luckett, a Clarksdale lawyer and alternative fuels entrepreneur, said.
Luckett is a board member of Earth Biofuels, one a handful of alternative fuel producers in Mississippi. The company makes and distributes biodiesel and is looking into an ethanol plant - although outside the state.
Luckett said proximity to the crop and to the market for the finished product are key to making an alternative fuels business profitable.
"You've just got to look at locations and what fits best," he said.
Americans use 129 million gallons of diesel and 382 million gallons of gasoline a day. Biodiesel and ethanol plants proposed in Mississippi will produce between 10 million and 30 million gallons of fuel a year, a relative drop in the energy bucket.
But Mississippi State University agricultural engineer Herb Willcutt said filling 30 percent of the state's diesel demand is attainable.
"It's achievable if we diverted a lot of our soybean oil, diverted the chicken fat and grew some other oilseed crops that aren't currently grown. It would take 10 to 20 years, but the driving force is just how high the price of oil goes," he said.
Mississippi's potential output of ethanol or biodiesel would be a fraction of the country's total energy picture. But the industry brings about 30 jobs per plant, and creating another market for farm products will bring farmers more money, said Alan Blaine, professor of agriculture at Mississippi State University.
"One advantage is we do grow 1.7 million acres (of soybeans) a year. If biodiesel could make the price of that commodity increase, there's no doubt we'd grow more acres," he said.
Mississippi harvested about 37.5 million bushels of soybeans last year, most of which got shipped down the Mississippi River and sold.
Willcutt said biodiesel has more potential than ethanol in Mississippi.
"Much of the corn for ethanol will have a transportation cost because it's got to be shipped in," he said. "At the end of the process, the distiller's grain will have to be dried for poultry and catfish feed uses and some may have to be shipped out to other markets."
TIGHT MARKET AHEAD?
Ethanol makes sense for the Midwest because the corn is already there, he said. Hog and cattle farmers in the Midwest can use the distiller's grain by-product as feed, whereas it wouldn't do as well in Mississippi's poultry and catfish feed rations.
Ethanol advocates say Mississippi farmers eventually would plant more corn to stem the need to import it. But farmers would have to more than double their output because the state already uses 130 million bushels of corn a year but produces about 50 million.
Mississippi also boasts an abundance of raw material for biodiesel from its current major farming products- poultry fat, fish oil, soybeans and cottonseed.
Willcutt said the poultry fat is undervalued and sells to animal feed producers and other markets for 8 or 9 cents a pound as opposed to soybean oil at 22-24 cents for biodiesel production.
But those in favor of ethanol said the soybean oil market is likely to dry up.
"We think there's a window for a while when soy oil will be fairly plentiful. But when a lot of these big biodiesel plants come on stream, it will make the market very tight - sometime around early 2008," Ergon Executive Vice President of Manufacturing and Planning H. Don Davis said.
Ergon, a Flowood-based oil refiner, plans to build an ethanol plant, possibly in Vicksburg. Davis said, although they'll have to barge in Midwest corn for a cost, Ergon will save on the back end because the finished ethanol will be closer to market - the major oil refiners on the Gulf Coast.
"A lot of people feel they can get into biodiesel for a low price with a small plant. There's a timeframe here in the next few months, you can make some pretty good money," he said.
KEY LEGISLATIVE ISSUE
Mississippi legislators have introduced bills to fund alternative fuel production incentives - between 6 and 20 cents a gallon - and to mandate a certain percent of biodiesel be blended into all diesel sold in the state.
Both bills have failed, but Rep. Bo Eaton, D-Taylorsville, is co-chairing a biodiesel study committee set to report to the Legislature in January.
He's been hearing from scientists and engineers, debating the economics of mandates and incentives and looking at the state's infrastructure, and is convinced Mississippi will be a player in the emerging alternative fuels market - just how big is yet to be determined.
"There are a lot of unknowns right now, but I think biodiesel has the greatest potential as far as using the natural resources we have available," Eaton said. "All the committee can do is set policy that makes it possible for industries to develop. But the jury's still out on that and the industry's got to come back and tell us what's needed."
Jack Mazurak – Clarion Ledger – August 5, 2006
http://www.cleanmpg.com/photos/data/501/Bio-Willie.jpg
Vickie D. King/The Clarion-Ledger - The BP station at the I-55 North Coffeeville exit offers biodiesel marketed under entertainer Willie Nelson's brand called BioWillie.
As the state looks to add businesses to its portfolio and oil prices show no signs of dropping, several experts said Mississippi would be better off producing biodiesel than ethanol, the alternative fuel garnering more legislative interest.
The two alternative fuels are the country's most immediately promising, and industries for both are gaining footholds in Mississippi. In the marketplace they don't compete against each other - one runs in gasoline engines, the other in diesel - but biodiesel seems the better fit from an economic standpoint because of proximity to feedstocks and the variety of Mississippi's crops.
Ethanol is an alcohol distilled from corn, sugarcane or other plant matter. It's most often blended with 15 percent gasoline to make E85, an alternative fuel that can be run in some gasoline-engine cars.
Although corn is a sizable Mississippi crop, farmers in the state use more than what's grown. So ethanol production would depend, at least for its start-up years, on imported corn, which would raise the cost of production.
Biodiesel, on the other hand, is brewed from animal fats, soybean oil or other oil-producing crops. If properly made, it can be used in nearly any diesel engine in pure form or at any percentage blend with petroleum diesel.
"What does make sense in Mississippi is our soybeans can be used to make biodiesel. Frankly, there can't be enough grown in Mississippi to satisfy our need," Bill Luckett, a Clarksdale lawyer and alternative fuels entrepreneur, said.
Luckett is a board member of Earth Biofuels, one a handful of alternative fuel producers in Mississippi. The company makes and distributes biodiesel and is looking into an ethanol plant - although outside the state.
Luckett said proximity to the crop and to the market for the finished product are key to making an alternative fuels business profitable.
"You've just got to look at locations and what fits best," he said.
Americans use 129 million gallons of diesel and 382 million gallons of gasoline a day. Biodiesel and ethanol plants proposed in Mississippi will produce between 10 million and 30 million gallons of fuel a year, a relative drop in the energy bucket.
But Mississippi State University agricultural engineer Herb Willcutt said filling 30 percent of the state's diesel demand is attainable.
"It's achievable if we diverted a lot of our soybean oil, diverted the chicken fat and grew some other oilseed crops that aren't currently grown. It would take 10 to 20 years, but the driving force is just how high the price of oil goes," he said.
Mississippi's potential output of ethanol or biodiesel would be a fraction of the country's total energy picture. But the industry brings about 30 jobs per plant, and creating another market for farm products will bring farmers more money, said Alan Blaine, professor of agriculture at Mississippi State University.
"One advantage is we do grow 1.7 million acres (of soybeans) a year. If biodiesel could make the price of that commodity increase, there's no doubt we'd grow more acres," he said.
Mississippi harvested about 37.5 million bushels of soybeans last year, most of which got shipped down the Mississippi River and sold.
Willcutt said biodiesel has more potential than ethanol in Mississippi.
"Much of the corn for ethanol will have a transportation cost because it's got to be shipped in," he said. "At the end of the process, the distiller's grain will have to be dried for poultry and catfish feed uses and some may have to be shipped out to other markets."
TIGHT MARKET AHEAD?
Ethanol makes sense for the Midwest because the corn is already there, he said. Hog and cattle farmers in the Midwest can use the distiller's grain by-product as feed, whereas it wouldn't do as well in Mississippi's poultry and catfish feed rations.
Ethanol advocates say Mississippi farmers eventually would plant more corn to stem the need to import it. But farmers would have to more than double their output because the state already uses 130 million bushels of corn a year but produces about 50 million.
Mississippi also boasts an abundance of raw material for biodiesel from its current major farming products- poultry fat, fish oil, soybeans and cottonseed.
Willcutt said the poultry fat is undervalued and sells to animal feed producers and other markets for 8 or 9 cents a pound as opposed to soybean oil at 22-24 cents for biodiesel production.
But those in favor of ethanol said the soybean oil market is likely to dry up.
"We think there's a window for a while when soy oil will be fairly plentiful. But when a lot of these big biodiesel plants come on stream, it will make the market very tight - sometime around early 2008," Ergon Executive Vice President of Manufacturing and Planning H. Don Davis said.
Ergon, a Flowood-based oil refiner, plans to build an ethanol plant, possibly in Vicksburg. Davis said, although they'll have to barge in Midwest corn for a cost, Ergon will save on the back end because the finished ethanol will be closer to market - the major oil refiners on the Gulf Coast.
"A lot of people feel they can get into biodiesel for a low price with a small plant. There's a timeframe here in the next few months, you can make some pretty good money," he said.
KEY LEGISLATIVE ISSUE
Mississippi legislators have introduced bills to fund alternative fuel production incentives - between 6 and 20 cents a gallon - and to mandate a certain percent of biodiesel be blended into all diesel sold in the state.
Both bills have failed, but Rep. Bo Eaton, D-Taylorsville, is co-chairing a biodiesel study committee set to report to the Legislature in January.
He's been hearing from scientists and engineers, debating the economics of mandates and incentives and looking at the state's infrastructure, and is convinced Mississippi will be a player in the emerging alternative fuels market - just how big is yet to be determined.
"There are a lot of unknowns right now, but I think biodiesel has the greatest potential as far as using the natural resources we have available," Eaton said. "All the committee can do is set policy that makes it possible for industries to develop. But the jury's still out on that and the industry's got to come back and tell us what's needed."