US blend limit makes cellulosic ethanol unviable - company

17 June 2009 21:20  [Source: ICIS news]

DENVER, Colorado (ICIS news)--US ethanol maker POET on Wednesday said cellulosic ethanol production in the US was unviable unless the US raises its “blend wall” on gasoline.

Funding for cellulosic projects will be very difficult with gasoline blending restricted at 10% ethanol, said company chief executive Jeff Broin at the 25th Fuel Ethanol Workshop & Expo (FEW).

POET operates a pilot plant in South Dakota that uses corn cobs to produce 20,000 gal/year (75,700 litres/year) of cellulosic ethanol.

The company also plans to produce 25m gal/year of cellulosic ethanol at a commercial plant in Iowa, starting in 2011.

The so-called blend wall, or 10% limit (E10), means US ethanol demand as an additive in gasoline is capped at about 15bn gal/year.

That is based on the size of the US gasoline market, which estimated at 150bn gal/year.

US ethanol group Growth Energy, of which POET is a founding member, has launched a campaign to push for a limit of 15% (E15), but biofuel critics claim the higher blend will hurt automobile engines.

The ethanol group has dismissed that claim, saying science supports E15.

Growth Energy said a study funded by the US Department of Energy found that E15 caused no significant changes in vehicle tailpipe emissions or drivability when compared with E10.

The group also said that increasing blend levels from 10% to 15% will generate $24.4bn (€17.5bn) for the US economy and will displace 7bn gal/year of imported gasoline.

The 2009 FEW began on Tuesday in Denver. The conference will end on Thursday.

($1 = €0.72)

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By: William Lemos
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