Ethanol's second surge might be much more modest

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BY ART HOVEY / Lincoln Journal Star

Just when it seemed that ethanol developers’ tanks were running dry, Congress has trotted forward to fill ’er up, check the oil, and wipe some of the winter grime off the windshield.

In the spirit of holiday giving, lawmakers have mandated usage of up to 9 billion gallons of renewable fuel in 2008, 15 billion gallons from grain-based sources by 2015, and another 21 billion gallons by 2022.

Look for Nebraska ethanol plants to use those tools to play a prominent role in where expansion in agriculturally-based energy goes from here. But don’t expect anything like the “gold rush” mentality that led to dozens of ground breakings across the state in 2006 and 2007.

There has been some measurable pain with the gain. Corn prices have risen, ethanol prices have fallen, investors have backed off, and critics have stepped up with questions about how much ethanol matters in the big energy equation.

Todd Sneller of the Nebraska Ethanol Board anticipates fewer ribbon-cutting road trips in the years ahead and more ownership consolidations, such as the one that recently brought plants at Ord and Central City into the VeraSun fold.

“I think there will be more disciplined growth,” Sneller said. “The ethanol industry, particularly those who have not been involved for more than two years, had a real lesson in the consequences of rapid growth.”

Although owners blamed it on construction delays, the E3 BioFuels plant at Mead shut down in late November and sought relief in bankruptcy court. Other projects have stalled in the planning stages.

It was action by Congress in 2005 that caused ethanol interests to put the pedal to the metal.

An initial mandate called for 7.5 billion gallons of highway fuel from renewable sources by 2012. It created a production race in which the experience of some of the players was no match for their enthusiasm.

Now, said Sneller, “I really think the first activity we’ll see, because it’s the least risky activity, will be an evaluation of which plants will be expanded.”

There will also be time for some tinkering by people whose orientation to the business doesn’t involve bulging briefcases, ringing cell phones, and parking in the fire lane.

Harold Witulski, a 77-year-old retired farmer from Beatrice, fits the tinkering mold.

Witulski has pulled back a bit on the attention he’s been paying to 40 antique tractors to try to turn a silage chopper into a tractor-towed, energy-harvesting machine.

By replacing the chopping gear with rollers, he’s had some success in squeezing the sugary juice out of sweet sorghum, which is attracting research scrutiny as an energy crop at the University of Nebraska-Lincoln.

Much of his harvest went to sorghum syrup for pancakes. But the juice can be easily converted into ethanol and the plant’s tall stalks are another promising possibility for making what’s typically called cellulosic ethanol from plant mass.

“The thing is, the machine I made would do it on the go,” Witulski said. “And if you’re going to strip it by hand, it’s a lot of work.”

Not surprisingly, his efforts have attracted plenty of praise from Ismail Dweikat, an agronomist at UNL and a leader of its sweet sorghum research.

Witulski, said Dweikat, “should be a model for the farmer in all of us.”

The object of his admiration planted about an acre of sweet sorghum to serve as a proving ground for his machine. He’s willing to give it another go in 2008.

“Ismail said he’s going to give me some better seed, so I might try a little bit. I’m going to be 78 years old, so I don’t want to work too hard anymore.”

There are plenty of younger people in the ethanol ranks who do intend to work long and hard again in 2008. But the Ethanol Board’s Sneller is not the only one to see some limitations on what can be accomplished with raw effort.

Ken Cassman, director of the Center for Energy Sciences Research at UNL, said a second mandate move by Congress “holds tremendous potential for Nebraska agriculture.”

But Cassman also sees “some real sobering challenges” in raising enough corn to meet the needs of ethanol over the next few years without using more water and without posing major problems for those who use corn to feed livestock or make food products.

“High among them, I think, is how we’re going to accelerate the rate of gain in corn yields.”

Progress in research aimed at making ethanol from cornstalks, sorghum stalks and perennial switchgrass could take some of the pressure off corn.

Ken Vogel, a switchgrass researcher at UNL and a U.S. Department of Agriculture staff member, said planting that crop, which grows as tall as 6 feet, on marginal land is part of the answer.

He points to a pilot cellulosic plant at York and commercial-scale cellulosic plants that should be in operation within the next three years in Kansas and other states.

“Dedicated energy crops are going to be used; they’re going to be needed in order to meet our energy goals,” Vogel said, “because there are not enough crop residues that are going to be available.”

But apart from the availability of raw materials, others wonder how congressional mandates will convert to more ethanol use at gasoline pumps.

Sneller sees a need for more flex-fuel vehicles that can burn up to 85 percent ethanol. He’s also looking for fuel mixtures that go beyond the familiar 10 percent blends to 20 or 30 percent — and perhaps without requiring engine modifications.

Without such action, “there’s simply no way to go beyond 15 million gallons” of demand.

Seen from a Nebraska vantage point, he’s expecting the energy bill President Bush signed just before Christmas to bring a few projects out of mothball status. That could include Wahoo and Sutton.

But it will not include a Panda Ethanol plant in Lincoln County and the North Platte area. Panda said earlier this month it was pulling back on plans for a 100 million gallon plant at Wallace.

That announcement stands, despite Bush’s signature, said Panda spokesman Bill Pentak from Dallas, Texas. And that’s despite what he described as “a great step forward” for energy security, cleaner air, and a choice at the pump for consumers.

“We don’t anticipate the renewable fuels standard, as it stands now, will impact our decision to not go forward with the Lincoln (County) project,” Pentak said.

Reach Art Hovey at 523-4949 or at ahovey@alltel.net.