EPA’s 2018 Renewable Fuel Targets Disappoint Producers

In Washington, the Environmental Protection Agency released its final Renewable Fuel Standard renewable volume obligations for 2018. The agency finalized a total renewable fuel volume of 19.29 billion gallons , of which 4.29 BG is advanced biofuel, including 288 million gallons of cellulosic biofuel. As the Renewable Fuels Association explained: “That leaves a 15 BG requirement for conventional renewable fuels like corn ethanol, consistent with the levels envisioned by Congress in the 2007 Energy Independence and Security Act. The 2018 total RFS volume finalized today represents a minor increase (10  million gallons) over the 2017 standards, and a modest increase...

KiOR: The Inside Story Of A Company Gone Wrong

Jim Lane Not long ago, KiOR quietly re-named itself Inaeris Technologies and launched a modest website which discussed the technology and management in little detail, but focused to an extraordinary extent on a declaration of values. Empowerment, honesty, fairness, “lessons learned from our collective experience” and so on. Warm, kindly Hallmark Card sentiments, universally popular, admired and vague. Not the bold, We-Are-Black-Swans, detailed descriptions of yields, costs, downstream partners, brand-name board members and timelines to commercial scale that had been the style of the Old KiOR. Old KiOR was exciting, dramatic,...

Dyadic: Congenial Customer Relations

by Debra Fiakas CFA A continuous quest to find companies that can turn sales into profits has turned up an unlikely font of cash.  Dyadic International (DYAI:  OTC/PK) is a developer of industrial enzymes.    Back in the day the company sold enzymes to the rag trade to create those fancy jeans with the stone washed look.  More recently Dyadic has worked with Abengoa (ABGB: NASD) and Codexis (CDXS : NASD) in support of their renewable fuel processes. Dyadic uses the fungus Myceliopthora thermophila in a fungal expression system for gene discovery, expression and the production of...

Waste Vegetable Oil: A Slick Way to Biofuel Your Portfolio

In August, I argued that Biodiesel stocks could be in trouble from more efficient ways to turn the oils and fats they use as feedstock into fuel, and concluded the article by saying that the likely winners are suppliers of oils and fats, not the processors.  James Kingsdale, of Energy Investment Strategies has been thinking along the same lines.  Last week he wrote an excellent overview of the major biofuels industries, including some stock picks.   One of those stock picks was the diamond in the rough I wish I had known about when I wrote Biodiesel's Nightmare: Renewable Diesel...

Why Have Ceres’ Sorghum Plans Soured?

Jim Lane Sorghum Bicolor photo by Matt Lavin As Ceres points towards minimal plantings of its sweet sorghum hybrids in its key market of Brazil for next year, investors ask two questions. Will sweet sorghum realize its vast potential, and when? Just when many observers hoped that Ceres, Inc. (CERE) would dramatically expand hectares planted with its Blade hybrid sweet sorghum, the 2014 planting outlook was released last week and the total hectares crashed from 3000 in 2013 to 1000 in 2014. It’s a far cry...
GasolineGate

Report Alleges EPA Tests Skewed Against Ethanol By Oil Industry Influence

by Jim Lane In Washington, researchers for a report published by the Urban Air Initiative contend that “technical data that shows the nation has been exposed to decades of flawed test fuels and flawed driving tests, which in turn means flawed emissions results and mileage claims”.  The complete Beyond a Reasonable Doubt series from UAI is available here. Further, EPA emails obtained under the Freedom of Information Act reveal that, according to a report from Boyden Grey & Associates, the Agency appears to have directly solicited financial contributions and technical input, “especially on the fuel matrix,” from an oil industry controlled research organization. Of the...

10,000+ Miles per Acre on Cellulosic Biogas

Biopact reports that Salzburg AG has opened its first biomethane gas station, allowing owners of Compressed Natural Gas vehicles to use their blend of 20%.  This is the first retail station I have heard of selling a cellulosic-derived fuel to retail customers (are there others?) Prospective Cellulosic Ethanol investors should take note... while cellulosic feedstocks are likely to supply much of our liquid fuels in the future (although not as much as we currently use), cellulosic ethanol is unlikely to have the field (so to speak) to itself.  Ethanol's low energy density and difficulty of transport will...

Emissions Standards Driving Algae Aviation Fuel Sourcing…or not

by Debra Fiakas CFA Algae in the River Wate photo via BigStock My post “Algae Takes Flight” featured Algae-Tec (ALGXY:  OTC/PK),  Lufthansa’s new biofuel partner.  Algae-Tec has agreed to operate an algae-based biofuel plant in Europe to supply Lufthansa with jet fuel.  Lufthansa is footing the capital costs of the plant, which is to be located in Europe near a carbon source.  Algae thrive on carbon so industrial plants and power plants using fossil fuels make the best neighbors.  Lufthansa has agreed to purchase a...

Gevo To Supply Lufhansa With Renewable Jet Fuel

Jim Lane   In Colorado, Gevo (GEVO) has entered into a heads of agreement with Lufthansa to supply Gevo’s alcohol-to-jet fuel from its first commercial hydrocarbon facility, intended to be built in Luverne, MN. The terms of the agreement contemplate Lufthansa purchasing up to 8 million gallons per year of ATJ from Gevo, or up to 40 million gallons over the 5 year life of the off-take agreement. Gevo utilized the enthusiasm generated in financial markets yesterday to raise $15.6M in cash and to convert $11M in debt to equity. What the deal means in the short term...

Total Doubles Down On Amyris’ Jet Fuel

Jim Lane In California, Amyris (AMRS) announced that it has agreed on key business terms with Total for restructuring its fuels joint venture to open the way for proceeding with commercialization of its jet fuel technology over the coming years. Following the restructuring, Total would own 75% of the joint venture with Amyris. In conjunction with this transaction, Amyris has also agreed on terms with Total and Temasek, another major stockholder of Amyris, under which, and as part of a plan to strengthen the balance sheet, these stockholders would exchange an aggregate of $138...

KiOR Shows Its Gallons

KiOR Shows Its Gallons Jim Lane Landmark cellulosic drop-in biofuels producer releases update on early-stage production: is the increasing gallonage enough to silence the critics? Today, we head to the Chapel of Hard Data, and get closer to the music. Nobody walks slower, in public, than at a wedding or a funeral. In the case of KiOR (KIOR), the critics and supporters have been shouting loud as the company makes its slow, public march up the aisle towards steady-state operations. Most observers, sitting in the pews, have been unsure as to whether to be...

Biodiesel Christmas Caroling: FFA La La

Jim Lane “On the way” forever, talked up by all, deployed by some – technologies that handle high free fatty acid feedstocks like used cooking oil are coming into their hey-day, via players like REG, Novozymes, Pacific Biodiesel, Blue Sun, Piedmont, COMAC and more. Christmas come early for advanced biofuels? One of the most alluring targets in advanced biofuels although cruelly mis-named is in the world of free fatty acids. Most of the oils currently used for biodiesel are sourced from soybeans, palm or rapeseed, and precisely because they contain less than 0.5%...

KiOR: a 5-Minute Guide

Jim Lane KiOR, Inc. is a next-generation renewable fuels company that has developed a proprietary technology platform to convert sustainable non-food biomass into cellulosic gasoline, diesel and fuel oil. Using standard refinery equipment, KiOR’s products are compatible with the existing fuel infrastructure. KiOR strives to ease dependence on foreign oil, reduce lifecycle greenhouse gas emissions and create high-quality jobs and economic benefit across rural communities. Address: 13001 Bay Park Road, Pasadena, TX 77507 Year founded: 2007 Stock: Nasdaq: KIOR. As of 8/31/12 Khosla Ventures, Artis Capital, Alberta Investment Management Corporation and other major...

Solazyme: Microbes in the Dark

by Debra Fiakas CFA The previous post “Solazyme's Detours on the Way to Algae Biofuel” began a discussion of Solazyme, Inc. (SZYM:  Nasdaq), a self-described “oil developer” targeting three commercial markets that are known heavy oil users:  chemical and fuel, nutrition and skin care.  Solazyme touts its ability to serve customers with oils tailored to their specific needs, creating a paradigm shift from the status quo where formulators and manufacturers must design around the limitations of conventional oils. Solazyme is attempting to harness the oil producing capability of microalgae -  the most diminutive...

FutureFuel: Still Future, Less Fuel

by Debra Fiakas CFA The last post “From Fuel to Fudge” discussed how the old Solazyme developer of algal-based renewable fuel has been transformed into a new company called TerraVia, (TVIA) which is pursing algal-based food and personal care products.  Solazyme is not the only renewable fuel company to make an about face.  Granted FutureFuel Corporation (FF:  NYSE) has not changed its name or stock symbol like Solazyme.  However, its ability to produce specialty chemicals has given FutureFuel an alternative to biofuels and its early plans to build a plant that could eventually produce 160 million gallons of...

What I Sold: Nova Biosource Fuels (NBF)

Preparing for a world in which financing will be much more difficult to come by, I have been selling companies which are likely to need financing in the next couple of years.  A listing of the companies I've discussed so far is at the end of this entry. My sale of Nova Biosource Fuels (AMEX:NBF) continues my general moves out of biofuels, also discussed in my entries on Pacific Ethanol and Dynamotive Energy Systems.  I have long argued that electric propulsion is a superior way to power ground transport than even "Second Generation" biofuels such as cellulosic ethanol.  My...