October 29, 2007
CARB throws Ethanol a lifeline
CARB today announced it will adopt a resolution stating that all refineries producing petrol sold in the state will have to blend 10% ethanol. Over 1B new ethanol gallons. just in the nick of time.
October 23, 2007
LATOC: mexico admits their oil peaked...
President Felipe Calderon is delivering a grim message: The largest oil
producer in Latin America is running out of crude. "Our oil reserves
have been consistently falling," and the decline is "severely
threatening'' government finances, Calderon told a nationwide
television audience in an address last month at the National Palace." continue reading.
Weak dollar or worldwide demand driving commodities?
If you are a dollar investor you say "global demand" if you are a Euro investor you say "weak dollar". Either way, good for US denominated assets and producers of commodities...
Commodity Indices in Various Currencies (Return Last 12 months)
US British Swiss Japanese
Dollars Euros Pounds Francs Yen
CRB 9.9% -3.0% 0.8% 1.7% 5.8%
DJAIG 7.0% -6.0% -2.1% -0.9% 2.5%
MLCX 22.4% 7.8% 11.9% 13.3% 17.7%
Check out new Northwest energy Angels site!
The angel group I founded has a new site. Submit plans on-line, join as an angel. Join the cleantech deal flow of the northwest!
Scariest Democrat game
Click here to play who is scariest.... Great Halloween fun!
October 22, 2007
BioBike gets 100MPG
Well I bought one that already does that from EcoRider, but some students in Aus have rigged one together as well. Unfortunately they chose a 10HP engine and i bet the thing can't make it over 30mph. Go Neander!
October 19, 2007
Submit your idea to NW Energy Angels
I started the NW Energy Angels as a way to help northwest companies doing something about energy to connect with investors. I am happy to announce that the group has implemented Angelsoft which allows for on-line submission of your business plan. Submit your plan here:
Carbon credits coming to biodiesel
I have been talking for some time about the extra values that are available from burning biodiesel versus petro diesel. One of these is the value of carbon reductions (since biodiesel produces 78% less carbon than diesel). There are a number of organizations trying to get a protocol approved from an exchange to value the credits. The current leading market which should approve biodesel carbon credits first is the Chicago Carbon Exchange (CCX). Biodiesel Mag has an article on this. I expect this to happen by Q1 08. This will be a very interesting development for the overall biodiesel industry.
October 18, 2007
Researchers predict 12 fold increase in lipid yields around the world
I have been talking for some time about the fact that current oilseed industry has been developed and optimized for food production. That if you were to manage and optimize the crops for fuel production you could get a radical increase in oil production. These researchers affirm that.
October 15, 2007
Oil heads up over $85
can I say I told you so?
October 9, 2007
The dual fuel renewable monster lives!
The good folks at HLine conversions have put in the Duramax engine, Allison transmition, ethanol injection, air bags and a bunch of other tricks. Check it out!
October 7, 2007
Oh, what a difference distillation makes
The distillation column at Imperium Gray's Harbor is up and running. The fuel on the left is what we have been making using an adsorbent polishing, the fuel on the far right is the pure distilled product. Totally rock'n!
October 2, 2007
Verasun halts construction on plant
The slowdown is officially upon us.
2007-10-02 08:43:01 EDT***VERASUN HALTS CONSTRUCTION PLANS FOR INDIANA ETHANOL PLANTOne of the first major casualties of thinning ethanol producermargins was announced yesterday with VeraSun Energy saying late Mondaythat it will suspend construction of its 110 million gal/yr ethanolplant in Reynolds, Ind., at least until next year.The suspension, "due to current market conditions," could be liftedin 2008, "depending upon the return of more favorable marketconditions," VeraSun noted."We believe it's important to be mindful of the current marketconditions and manage our business accordingly," said VeraSun ChiefFinancial Officer and Senior Vice President Danny Herron. "Given theabrupt change in market conditions that have seen ethanol prices dropnearly 50 cents per gallon in the last 60 days, it is prudent for us toadjust our current pace of expansion. Due to Reynolds' early stage ofdevelopment, we believe it is wise to suspend investment until themarket provides an acceptable return," he added.VeraSun announced plans to build the Reynolds ethanol plant on April18 and completed site grading and preparation work in August, thecompany noted.VeraSun's news is the first tangible evidence from a major producerof what ethanol analysts have been warning of in recent weeks. In aresearch note, Friedman Billings Ramsey analyst Eitan Bernstein recentlydescribed the ethanol industry's "growing pains" of thinning producermargins and concerns of potential oversupply. He downgraded ratings ofseveral ethanol companies, including VeraSun, and similar reasons causedSoleil Securities Analyst Ian Horowitz to recently downgrade threeethanol companies, including VeraSun.VeraSun has three ethanol plants online -- two in Iowa and one inSouth Dakota -- and expects to bring two, 110 million gal/yr ethanolplants, one in Hartley, Iowa, and another in Welcome, Minn., online bythe first quarter of 2008. Additionally, in August, VeraSun closed onits acquisition with ASAlliances Biofuels, which includes three, 110million gal/yr ethanol plants.The Linden, Ind., ethanol plant began production in July and the tworemaining plants -- in Albion, Neb., and Bloomingburg, Ohio -- areexpected to begin production by the end of the first quarter of 2008.VeraSun Chairman and CEO Don Endres said the company will continueits focus on the ethanol plants currently under construction. "We remainconfident in the outlook for our industry and believe that with ethanolcurrently priced at a dollar less than gasoline, it provides a greatvalue as a high-octane, clean- burning renewable fuel that will driveadditional blending throughout the nation," he added.No further information was available, however more details could beprovided later this morning, when VeraSun's Herron is scheduled to speakat Citigroup's "Ethanol on the Cob Day II" conference in New York. Hispresentation, scheduled for 9 a.m. EST, will be webcast throughVeraSun's website.-Rachel Gantz, email@example.com
Now a B30 car from Renault
Renault has unveiled the Logan Renault eco2 Concept, the experimental car it will take to the upcoming Challenge Bibendum in Shanghai, China. The Logan Renault eco2 has estimated CO2 emissions of 97 g/km.
Logan Renault eco2 Concept is powered by a B30-compatible 1.5 dCi diesel engine (63kW/85hp) and benefits from a set of technical solutions and optimizations that serve as development pathways for future Renault vehicles.
People across the country are doing cool stuff with renewable fuels. Orbital Corporation has run E100 in a direct injection engine and generated LOTS of power! Check out the tech details at Green Car Congress.
Propel yourself with Biodiesel in Northwest!
Propel Biodiesel is starting to put their stations in the ground! We know the Propel guys well (in fact they are hanging in our office). These stations will carry the best fuel on the planet, Imperium's! and are the most convenient way to hook up with biodiesel. They are rolling out 20 in the next couple months.
October 1, 2007
now here is someone having fun: BioBling.
Get a biodiesel car, bling it out. Have fun.
very cool photographs. We trade lots of soybeans on the CBOT. Andreas did a nice photo of it.
why oil is going higher
when adjusted for falling value of the dollar, oil is not expensive.
the reality is that the oil producing nations are just barely keeping up with the fall in the dollar with price hikes.
Dow Jones: $100 oil aint so bad, in fact it is "good" for us so expect it soon
Per our conversation last week...
DOW JONES REPRINTS
How Economy Could Survive OilAt $100 a Barrel
Compared to 1980, U.S.Is More Able to Handle Once-Unthinkable Rise
By PETER FRITSCH and KELLY EVANSSeptember 29, 2007;1
The world economy has managed, with some indigestion, to swallow the rise of oil prices past $80 a barrel. How well could it survive $100 a barrel?
The answer is quite well -- so long as several conditions still hold true. The price rise would probably have to be gradual. Inflation couldn't get so bad as to force big interest-rate hikes. Oil-rich nations would need to pump their profits back into U.S. and European economies.
All of this has happened so far. The happy confluence may continue, though fears remain strong that high energy prices will tip the U.S.into recession.
A host of factors, including tight oil supplies and a weak U.S. dollar, suggest that oil prices have further to rise. Some analysts continue to believe that oil is destined to reach an all-time high, as measured in today's dollars, of more than $101 a barrel. The record was set in 1980. On Friday in New York, the benchmark crude-oil futures price closed down $1.22, or 1.5%, to finish at $81.66, a little more than $2 off the all-time high, not adjusting for inflation.
High oil prices could lead to ugly consequences if they hit consumers' pocketbooks -- especially in the U.S., where the housing slump is already hurting the economy. Consumer spending has been the primary engine of growth in the U.S. in recent years.
Target Corp. was among the major retailers in the last week cutting sales forecasts. Target expects September sales at stores open at least a year to rise just 1.5% to 2.5%, down from an earlier expectation of 4% to 6% growth.
For all the concern, the world today is better equipped to swallow expensive oil than it was when Jimmy Carter was installing solar panels and a wood-burning stove in the White House.
The main reason has to do with what some call the Wal-Mart effect. For every extra dollar taken from drivers' pockets at the pump in the form of higher prices in recent years, low-cost exporters from China and elsewhere have put roughly $1.50 back in the form of cheaper retail goods. Even at today's near-record prices, U.S. households today spend less than 4% of their disposable income at the pump, vs. over 6% in 1980.
Current prices are also a reflection of a strong economy, not an oil embargo or war in the Middle East. Since a market-share war between Saudi Arabia and Venezuelaflooded the market with oil and drove prices to below $11 a barrel in 1998, oil prices have risen nearly eight-fold. During that run, the global economy grew roughly 5% each year.
Strong growth in places like China helps take some of the edge off the oil-price blow for U.S. and European companies such as Detroit's Big Three auto makers. Many emerging markets are hitting a "takeoff" stage, where per-capita income reaches a level that sparks serious auto demand, says Ellen Hughes-Cromwick, Ford MotorCo.'s chief economist. Growth in emerging markets is a "structural development" that is "less sensitive to oil-price changes," she says.
"There's a more relaxed attitude now," said Daniel Yergin, a noted oil historian and chairman of Cambridge Energy Research Associates. At a recent event promoting Alan Greenspan's new memoir, Mr. Yergin asked the former Fed chief on stage if $80 oil was a concern. "Hebasically shrugged and said, 'Not so far,'" Mr. Yergin recalls.
Economists see global growth slowing but still chugging along at a relatively healthy 3% this year and next. High oil prices also mean more money for oil-producing nations such as Russia and Saudi Arabiato invest globally. "If resource owners are now getting a bigger piece of the pie to spend and invest, then $100 oil shouldn't be a problem" in the absence of a U.S. recession, says independent energy economist Philip Verleger Jr. "And that investment is happening."
Such sanguine views, while they are far from universal, reflect a fundamental shift in economists' understanding of how energy prices affect the economy.
Historically, oil prices have doubled or trebled in a matter of weeks because of sudden and sharp supply disruptions, such as those in 1980 following the Iranian revolution and the outbreak of the Iran-Iraq war. That prompted the Fed to raise interest rates sharply in an effort to head off a spiral of inflation.
Current Fed chairman Ben Bernanke has spent a lot of time trying to understand such shocks. In 1997, he analyzed the effects of sharp rise in prices during the oil shocks of 1973-75, 1980-1982 and 1990-91 in the Brookings Papers on Economic Activity. His surprising conclusion: The Fed's cure for high oil prices was worse than the disease.
"The majority of the impact of an oil price shock on the real economy is attributable to the central bank's response to the inflationary pressures engendered by the shock," he wrote. Today, that view is fairly mainstream among central bankers.
Mr. Bernanke's Fed recently responded to the subprime mortgage crisis by cutting benchmark interest rates for the first time in four years. By implication, the Fed was saying it was moreworried about the fallout from credit-market gloom than about the risk of inflation. At a time of record energy prices, that's a risky but educated bet.
Growing fuel efficiency could also blunt the blow of higher prices. James Barnes, a Union Pacific Corp. spokesman, says the railroad has bought more fuel-efficient locomotives and trained engineers to operate trains in ways that conserve fuel. "From a macro level, we would anticipate that rising oil costs will make us more competitive [with trucks] and potentially drive more business our way," Mr. Barnes says.
Engine of Growth
In China, the engine of growth on which many are counting, other energy sources can make up for oil. Chinauses oil for only 21% of its energy needs, with most of the rest coming from coal. Unlike in the U.S., where imported oil goes to fill people's gasoline tanks, China mainly uses oil in industrial settings, where coal may be an alternative. Greater coal use, however, would also exacerbate China's already serious pollution problem and speed up emissions of gases that contribute to global warming.
Still, some fear the impact of $100-a-barrel oil would be too powerful for the U.S.to overcome. "If we aren't already headed for a recession, it could push us in that direction," says Bill Zollars, chairman and chief executive officer of YRC Worldwide Inc., a large trucking company based in Overland Park, Kan."With a very fragile economy like we have now, this could be another burden for the consumer and the business community."
Mr. Zollars says shipment volumes at YRC, which serves many retailers and manufacturers, have dropped to 2003 levels. "We are not seeing the kind of volume we would normally expect" ahead of the Christmas retail season, he adds.
Fall in Demand
Higher oil prices could hit the beleaguered auto and airline industries. Detroitis still digging out from the fall in demand for sport-utility vehicles caused by the climb in gasoline prices. Paul Ballew, General MotorsCorp.'s top sales analyst, explained sluggish industry sales earlier this month by citing in part high fuel prices, which he called "effectively a tax on U.S. households."
For now, most economists expect oil prices will stay high through next year. An unexpected hurricane in the Gulf or a sudden disruption to oil flows from a big producer like Iran or Mexico could push oil to $100, they say.
Demand is chugging along. The Paris-based International Energy Agency sees world oil demand in the fourth quarter rising by 2.8%, or 2.3 million barrels a day from a year ago, to nearly 88 million barrels a day.
Of course, those forecasts could go awry if the U.S. economy tanks and brings Europe and Japan along with it. Then demand would likely ease, and oil prices could fall, perhaps significantly. And then, the world would have something else to worry about.
Rainy day in Portland
Thanks to everyone who supported me and the other Imperium Renewable team members in the Lance Armstrong LiveStrong ride yesterday in Portland. It was 50 degrees and driving rain with a 10 mile headwind! But most everyone made it and even smiled in the end. The team raised over $12K for the foundation and LAF raised over $1.7M in the entire event. Thanks!