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Archive for April 2009

Investment news from Total and Energy Investors Funds

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Total invests in Gevo

Total, the French oil and gas group, is investing in Gevo, the Denver advanced biofuels company.

Gevo, engaged in “developing and commercializing” renewable hydrocarbon technology for the refining and chemical industries, said Total has invested in the company’s ‘series D’ investment offering. The amount of Total’s investment was not disclosed.

Gevo says in an April 27 press release it s “commercializing technology for the cost effective production of renewable, fungible hydrocarbons” such as gasoline blendstocks, renewable jet fuel and renewable diesel blendstocks. In addition to fuels, Gevo says its technology enables the production of a wide variety of chemicals and plastics such as polyacrylates and PETE from renewable resources.

“To have one of the world’s largest oil and gas companies invest in Gevo is significant validation of the potential of our technology and products,” said Patrick Gruber, Gevo’s CEO. He said Total joins an investment syndicate roster that includes Khosla Ventures, Virgin Green Fund, Burrill & Company, and Malaysian Life Sciences Capital Fund.

Jean-Michel Gires, Total’s Senior Vice-President Sustainable Development and Environment, said, “We are very pleased with this opportunity to contribute to next steps of Gevo’s development, with its promising bio-fuels and chemicals intermediates platform produced from renewable resources.” Gires is also president of Total Energy Venture International.

Gevo’s commercialization approach includes retro-fitting existing ethanol facilities to produce hydrocarbon products readily used in the refining and chemical industry. Later this summer, Gevo will bring a 1 million gallon per year semi-works plant in St. Joseph, Missouri on line and start developing its customer base for the commercial facility scheduled to come on line in early 2011.


EIF takes over Watertown Renewable Power

Energy Investors Funds, a Boston-based private equity fund manager that invests in the U.S. energy and electric power sector, said its United States Power Fund III, L.P. acquired Watertown Renewable Power LLC, a 30-megawatt biomass power project currently under development in Watertown, Conn. from Tamarack Energy Inc.

As usual in deals of this sort, the financial details and terms of the transaction were not disclosed.

Lucas Missong, an EIF vice president, said the project “provides a new source of clean electricity in a state with limited renewable resources.

“We believe investments in renewable power projects such as WRP will generate a solid return on investment for our investors as well as help our nation become less dependent on fossil fuels for the creation of electricity.”

Once completed, WRP will be capable of generating enough clean electricity to power roughly 30,000 area homes. The plant will run on small tree branches, stumps, old cargo pallets and trees taken down as part of forestry management programs.

Tamarack launched the Watertown project more than two years ago. Since then, the WRP team has secured numerous local zoning, air and wetlands permits and guided the project through a rigorous state siting process. As a successful applicant to Connecticut’s Project 150 program, WRP was able to negotiate an agreement with Connecticut Light & Power for the purchase of energy from the plant.

EIF was founded in 1987 as the first private equity fund manager dedicated exclusively to the independent power and electric utility industry. The firm says it has mobilized more than $3.4 billion in capital raised in seven funds, and currently manages four private equity funds from its offices in Boston, New York, and San Francisco.

These funds have made more than 100 diversified investments with a combined underlying asset value exceeding $7 billion, it adds. EIF controls 4,000 MW of operating power assets with another 2,200 MW of power assets under development or construction.

EIF has made numerous investments in the clean power sector, including investments in 16 hydroelectric facilities and a portfolio of 19 landfill gas-fired facilities across the United States. The landfill projects turn waste methane into electricity and pipeline-quality renewable natural gas.

The firm also owns or is funding the development of biomass projects in New England, California and Florida as well as a geothermal project in Nevada. The company has also invested in California-based Solar Power Partners, Inc., a leading national solar energy services provider. In addition, EIF owns 70 percent of the Detroit Resource Recovery Facility, an electric power generation and steam facility fueled by municipal refuse.

“We found that a number of well-funded investment groups were interested in discussing the purchase of the Watertown project,” said Tamarack Project Manager Mark Mirabito.  “EIF emerged as the successful buyer because of their significant experience in raising capital for clean energy projects.  EIF is ideally positioned to lead WRP to a rapid and successful completion.”

In January Tamarack’s parent company, Haley & Aldrich Inc. decided to exit the renewable energy development business: As of April 6, the operations of Tamarack ceased.

EIF said it expects that some project management staff from Tamarack will remain active in the development of the WRP project. Nearly two-dozen jobs will be created at the plant. Another 100 workers will be needed to harvest, process, and transport the wood fuel material to the project site and hundreds of construction jobs will also be created during the 24-month period building the plant.

Written by William DiBenedetto

April 30, 2009 at 12:59 pm

Camelina seed going airborne?

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camelina31There’s algae and switchgrass – now add camelina to the roster of second generation biofuel crops.

Camelina could become a major player in the realm of aviation fuels. The Bozeman, MT renewable fuel company Sustainable Oils says the results of a life cycle analysis of jet fuel derived from camelina seeds shows that the fuel reduces carbon emissions by 84 percent compared to petroleum jet fuel.

Sustainable’s research was done in collaboration with UOP, a Honeywell company, at Michigan Tech University. The study was based on camelina grown in Montana and processed into biojet fuel using UOP’s hydroprocessing refining technology.

(Click here for a description of the UOP Renewable Jet Process.)

“The quickest way to reduce carbon emissions from aviation is to begin replacing petroleum fuel with fuel made from renewable and sustainable camelina oil,” says Scott Johnson, general manager of Sustainable Oils. “The acreage that we have contracted for 2009 will be used primarily to continue to develop the promising biojet market.”

He adds that the company has planted “thousands of acres” of camelina “specifically for this use.” This will “prepare us to supply the hundreds of millions of gallons of fuel we will need within five years. No other potential feedstock can provide as much fuel in as short a horizon.”

So what is camelina? It’s it’s a plant that produces seeds that are apparently well-suited as a sustainable biofuel crop. The seeds naturally contain high oil content. Also ithe oils are low in saturated fat, the plant is drought resistant and requires less fertilizer and herbicides.

Most importantly, it is an excellent rotation crop with wheat, and it can grow in marginal land.

Camelina does not displace other crops or compete as a food source. It is estimated that the state of Montana alone could support between 2 and 3 million acres of camelina, generating 200 to 300 million gallons of oil each year.

“Camelina is one of the most promising sources for renewable fuels that we’ve seen,” said Billy Glover, managing director, Environmental Strategy, Boeing Commercial Airplanes. “It performed as good if not better than traditional jet fuel during our test flight with Japan Airlines earlier this year, and supports our goal of accelerating the market availability of sustainable, renewable fuel sources that can help aviation reduce emissions. It’s clear from the LCA results that camelina is one of the leading near-term options and, even better, it’s available today.”photopage1jaldemo

Professor David Shonnard, Robbins Chair Professor of Chemical Engineering at MTU says, “Camelina green jet exhibits one the largest greenhouse gas emission reduction of any agricultural feedstock-derived biofuel I’ve ever seen.

“This high number is the result of the unique attributes of the crop – its low fertilizer requirements, high oil yield and the use of co-products, such as meal and biomass, for other uses.”

Sustainable Oils is a joint venture between Targeted Growth Inc., a renewable energy bioscience company, and Green Earth Fuels, a vertically integrated biodiesel energy company.


Written by William DiBenedetto

April 28, 2009 at 10:54 am

Panda sells ethanol plant for a song

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A U.S. bankruptcy court in Texas last Friday approved the sale of Panda Ethanolhereford-biofuels’s main plant in Hereford, Texas – Hereford Biofuels – for $25 million in credit to senior lenders led by Societe Generale.

That amounts to about 12 percent of the original construction and outfitting cost.

Hereford Biofuels is one of four subsidiaries of Panda Ethanol that filed for Chapter 11 bankruptcy in January. It was the lead entity constructing the $200 million, 100-mgy plant that was close to completion.

Societe Generale has not disclosed its plans for the plant. It is resolving disputes with Lurgi, the general contractor, and two lenders, Banco Bilboa and Greenstone regarding construction and funding issues.

The sale of the Hereford subsidiary under Section 363 of the U.S. Bankruptcy Code and the outstanding funding and construction issues, which are in arbitration, make the future of Panda uncertain. It was not a part of the Chapter 11 bankruptcy filing. But in March Panda decided to deregister as a public company with the Securities and Exchange Commission, suspending its obligations to file various financial reports with the SEC.

Darol Lindloff, Panda’s CEO, said at that time the company’s board determined that “going dark is in the best interest of the company and its stockholders.”

Panda announced financing to build the plant in August 2006. The plan called for the plant to go up on 380 acres north of Hereford. The operation envisioned turning more than 1 billion pounds of cattle manure from feedlots and dairies each year into fuel for the boilers supplying steam to the plant.

The next best bid for the plant was $15 million in cash from Ethanol Europe.

Written by William DiBenedetto

April 27, 2009 at 12:15 pm

Biofuel, biomass production boosted by new ARB regs

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bucolicskyTwo years after Gov. Schwarzenegger issued an executive order requiring low carbon fuel standards, the California Air Resources Board (ARB) voted Thursday by an overwhelming margin to adopt a regulation implementing the governor’s initiative.

It calls for a 10 percent reduction of greenhouse gas emissions from California’s transportation fuels by 2020.

This appears to give a big boost to alternative fuel production and distribution in the state. Regulators said they expect the new generation of fuels to come from the development of technology that uses algae, wood, agricultural waste such as straw, common invasive weeds such as switchgrass, and even from municipal solid waste.

ARB, a department of the California Environmental Protection Agency, says the new reg is aimed at “diversifying the variety of fuels used for transportation,” and will boost the market for alternative-fuel vehicles and achieve 16 million metric tons of greenhouse gas emission reductions by 2020. (ARB by the way is also commonly referred to as CARB, but since the agency refers to itself as ARB that’s what we’ll use.)

“The new standard means we can begin to break our century-old dependence on petroleum and provide California with greater energy security” said ARB Chairman Mary D. Nichols.

ARB’s analyses say that to produce the more than 1.5 billion gallons of the biofuels needed, more than 25 new biofuel facilities will have to be built and will create more than 3,000 new jobs, mostly in the state’s rural areas.

The regulation requires providers, refiners, importers and blenders to ensure that the fuels they provide for the California market meet an average declining standard of ‘carbon intensity.’ This is established by determining the sum of greenhouse gas emissions associated with the production, transportation and consumption of a fuel, also referred to as the fuel pathway.

“Economic mechanisms will allow the market to choose the most cost-effective clean fuels (those with the lowest carbon intensity) giving California consumers the widest variety of fuel options,” the agency says.

Seeking to enhance private sector and federal investment into alternative fuel production and distribution, California is also providing funding to assist in the early development and deployment of the most promising low-carbon fuels. The Alternative and Renewable Fuel and Vehicle Technology Program, managed by the California Energy Commission, will provide approximately $120 million dollars per year over seven years to deploy the cleanest fuels and vehicles.

That comes to $840 million, a very decent chunk of change.

Arnold issued the executive order requiring the low carbon fuel standard (LCFS) in early 2007. The standard does not become binding until Jan. 1, 2011.

Early reaction to the regulation was a little mixed, especially from ethanol producers concerned with ARB’s controversial calculations surrounding the emission impact of its ‘indirect land use change’ on sugar and corn ethanol.

The Brazilian Sugarcane Industry Association (UNICA) said sugarcane ethanol “passed a critical test” when ARB passed the LCFS. While UNICA “continues to provide evidence that sugarcane ethanol’s carbon intensity is even lower than initially calculated” by ARB, the decision “means sugarcane ethanol will be in greater demand in California in the years to come.

“The verifiable 90 percent greenhouse gas reduction delivered by sugarcane ethanol provides a source of low carbon fuel that achieves the goals of California’s ambitious regulation, with room to spare,” said UNICA President & CEO Marcos Jank following the vote in Sacramento.

“We congratulate California for leading the world in encouraging low carbon fuels. But any realistic evaluation of carbon emissions from sugarcane farming in Brazil must reflect the strict policies being implemented and action already taken to phase out sugarcane burning, increase mechanical harvesting and expand cogeneration output,” said Joel Velasco, UNICA’s chief representative in North America.

Velasco says that with CARB determined to push forward with indirect land use calculations, the best available data and research should be considered before rushing to conclusions. “Indirect land use changes must accurately represent the dynamics of Brazilian agriculture today. We are confident that a data driven analysis will conclude that indirect land use change from sugarcane cultivation in Brazil is marginal at best,” he added.

Growth Energy, a group comprised of U.S. ethanol producers, said meanwhile that ARB “voted to enact a standard that unfairly penalizes biofuels as compared to other fuels, including gasoline.”ethanol-plant

General Wesley Clark, co-chairman of Growth Energy, said, “We’re disappointed with the board’s vote. This was a poor decision, based on shaky science, not only for California, but for the nation. It is unfair to selectively single out the indirect effects of one fuel pathway while ignoring the significant indirect effects of all other fuels, including petroleum. Today’s decision puts another road block in moving away from dependence on fossil fuels and stifles development of the emerging cellulosic industry.”

Growth Energy said ARB unfairly penalizes biofuels by adding the “indirect land use change” figure to the carbon intensity of biofuels.

It argued that applying indirect effects only to biofuels set an unequal standard since other fuels also have indirect greenhouse gas emissions effects. However, Growth Energy said it is “pleased the ARB has agreed to continue its study of indirect effects, including indirect land use change as well as the indirect effects of all other transportation fuels.”

“The inclusion of an indirect land use change penalty against ethanol is not based on universally accepted science, puts our industry at an unfair disadvantage and would likely lead to increased dependence on foreign oil and stall efforts to create a greener economy,” said Tom Buis, Growth Energy’s CEO. “We’re very supportive of a low carbon fuel standard because ethanol is a low carbon fuel. Corn ethanol can thrive if all fuel pathways are calculated on a level playing field.”

My admittedly unscientific and perhaps naïve reaction to the above is that this is huge: Finally there is a decision that gives all types of biofuel some real direction and impetus. Calculating the “indirect” impact of land use on fuel pathways strikes me as inherently inexact and will always be subject to interpretation and debate. The bar has to be set somewhere and ARB has done this.

To view the regulation, all 374 pages of it, click here.

Written by William DiBenedetto

April 24, 2009 at 1:34 pm

AE Biofuels, Pearson Fuels fuel up

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butte_scaledaebAE Biofuels signed a “strategic agreement” to supply cellulosic ethanol to Pearson Fuels in California.

Pearson, based in San Diego, is developing a network of renewable fuels filling stations in the state. In fact the company built the first E85 fuel station in California six years ago.

As usual, financial details of the deal were not disclosed. The companies only disclosed that under the terms of the agreement, the Cupertino-based AE Biofuels (stock ticker: AEBF) will supply Pearson with cellulosic ethanol “and other biofuels” for distribution through renewable fuels filling stations in California. They will also use available government programs to develop additional renewable fuels filling stations in the state.

Also, AE recently signed an agreement with Merrick & Company to commercially implement AE Biofuels’ “patent-pending enzyme based technology for the conversion of non-food biomass into ethanol and other materials through the design of new biofuels facilities or the conversion of existing biofuels facilities.”

Merrick, based in Golden, CO, is an $85 million provider of engineering and architectural design-build, procurement, construction management, and geospatial services.


Under this agreement, which also features no financial disclosures, AE and Merrick will “work to deploy AE’s next-generation biofuels technology to address the significant demand for cellulosic ethanol created by the revised Renewable Fuels Standard (RFS).”


The Energy Independence and Security Act of 2007 increased the RFS to 36 billion gallons of renewable fuels, the majority of which must be advanced biofuels, such as cellulosic ethanol.

Written by William DiBenedetto

April 23, 2009 at 9:32 am

Still true: “We must act now”

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Al Gore’s Nobel Prize acceptance speech two year’s ago is worth re-reading on a regualr basis. Especially today.

al-gore

SPEECH BY AL GORE ON THE ACCEPTANCE

OF THE NOBEL PEACE PRIZE

DECEMBER 10, 2007

OSLO, NORWAY


Your Majesties, Your Royal Highnesses, Honorable members of the Norwegian Nobel Committee, Excellencies, Ladies and gentlemen.

I have a purpose here today. It is a purpose I have tried to serve for many years. I have prayed that God would show me a way to accomplish it.

Sometimes, without warning, the future knocks on our door with a precious and painful vision of what might be. One hundred and nineteen years ago, a wealthy inventor read his own obituary, mistakenly published years before his death. Wrongly believing the inventor had just died, a newspaper printed a harsh judgment of his life’s work, unfairly labeling him “The Merchant of Death” because of his invention – dynamite. Shaken by this condemnation, the inventor made a fateful choice to serve the cause of peace.

Seven years later, Alfred Nobel created this prize and the others that bear his name.

Seven years ago tomorrow, I read my own political obituary in a judgment that seemed to me harsh and mistaken – if not premature. But that unwelcome verdict also brought a precious if painful gift: an opportunity to search for fresh new ways to serve my purpose.

Unexpectedly, that quest has brought me here. Even though I fear my words cannot match this moment, I pray what I am feeling in my heart will be communicated clearly enough that those who hear me will say, “We must act.”

The distinguished scientists with whom it is the greatest honor of my life to share this award have laid before us a choice between two different futures – a choice that to my ears echoes the words of an ancient prophet: “Life or death, blessings or curses. Therefore, choose life, that both thou and thy seed may live.”

We, the human species, are confronting a planetary emergency – a threat to the survival of our civilization that is gathering ominous and destructive potential even as we gather here. But there is hopeful news as well: we have the ability to solve this crisis and avoid the worst – though not all – of its consequences, if we act boldly, decisively and quickly.

However, despite a growing number of honorable exceptions, too many of the world’s leaders are still best described in the words Winston Churchill applied to those who ignored Adolf Hitler’s threat: “They go on in strange paradox, decided only to be undecided, resolved to be irresolute, adamant for drift, solid for fluidity, all powerful to be impotent.”

So today, we dumped another 70 million tons of global-warming pollution into the thin shell of atmosphere surrounding our planet, as if it were an open sewer. And tomorrow, we will dump a slightly larger amount, with the cumulative concentrations now trapping more and more heat from the sun.

As a result, the earth has a fever. And the fever is rising. The experts have told us it is not a passing affliction that will heal by itself. We asked for a second opinion. And a third. And a fourth. And the consistent conclusion, restated with increasing alarm, is that something basic is wrong.

We are what is wrong, and we must make it right.

Last September 21, as the Northern Hemisphere tilted away from the sun, scientists reported with unprecedented distress that the North Polar ice cap is “falling off a cliff.” One study estimated that it could be completely gone during summer in less than 22 years. Another new study, to be presented by U.S. Navy researchers later this week, warns it could happen in as little as 7 years.

Seven years from now.

In the last few months, it has been harder and harder to misinterpret the signs that our world is spinning out of kilter. Major cities in North and South America, Asia and Australia are nearly out of water due to massive droughts and melting glaciers. Desperate farmers are losing their livelihoods. Peoples in the frozen Arctic and on low-lying Pacific islands are planning evacuations of places they have long called home. Unprecedented wildfires have forced a half million people from their homes in one country and caused a national emergency that almost brought down the government in another. Climate refugees have migrated into areas already inhabited by people with different cultures, religions, and traditions, increasing the potential for conflict. Stronger storms in the Pacific and Atlantic have threatened whole cities. Millions have been displaced by massive flooding in South Asia, Mexico, and 18 countries in Africa. As temperature extremes have increased, tens of thousands have lost their lives. We are recklessly burning and clearing our forests and driving more and more species into extinction. The very web of life on which we depend is being ripped and frayed.

We never intended to cause all this destruction, just as Alfred Nobel never intended that dynamite be used for waging war. He had hoped his invention would promote human progress. We shared that same worthy goal when we began burning massive quantities of coal, then oil and methane.

Even in Nobel’s time, there were a few warnings of the likely consequences. One of the very first winners of the Prize in chemistry worried that, “We are evaporating our coal mines into the air.” After performing 10,000 equations by hand, Svante Arrhenius calculated that the earth’s average temperature would increase by many degrees if we doubled the amount of CO2 in the atmosphere.

Seventy years later, my teacher, Roger Revelle, and his colleague, Dave Keeling, began to precisely document the increasing CO2 levels day by day.

But unlike most other forms of pollution, CO2 is invisible, tasteless, and odorless — which has helped keep the truth about what it is doing to our climate out of sight and out of mind. Moreover, the catastrophe now threatening us is unprecedented – and we often confuse the unprecedented with the improbable.

We also find it hard to imagine making the massive changes that are now necessary to solve the crisis. And when large truths are genuinely inconvenient, whole societies can, at least for a time, ignore them. Yet as George Orwell reminds us: “Sooner or later a false belief bumps up against solid reality, usually on a battlefield.”

In the years since this prize was first awarded, the entire relationship between humankind and the earth has been radically transformed. And still, we have remained largely oblivious to the impact of our cumulative actions.

Indeed, without realizing it, we have begun to wage war on the earth itself. Now, we and the earth’s climate are locked in a relationship familiar to war planners: “Mutually assured destruction.”

More than two decades ago, scientists calculated that nuclear war could throw so much debris and smoke into the air that it would block life-giving sunlight from our atmosphere, causing a “nuclear winter.” Their eloquent warnings here in Oslo helped galvanize the world’s resolve to halt the nuclear arms race.

Now science is warning us that if we do not quickly reduce the global warming pollution that is trapping so much of the heat our planet normally radiates back out of the atmosphere, we are in danger of creating a permanent “carbon summer.”

As the American poet Robert Frost wrote, “Some say the world will end in fire; some say in ice.” Either, he notes, “would suffice.”

But neither need be our fate. It is time to make peace with the planet.

We must quickly mobilize our civilization with the urgency and resolve that has previously been seen only when nations mobilized for war. These prior struggles for survival were won when leaders found words at the 11th hour that released a mighty surge of courage, hope and readiness to sacrifice for a protracted and mortal challenge.

These were not comforting and misleading assurances that the threat was not real or imminent; that it would affect others but not ourselves; that ordinary life might be lived even in the presence of extraordinary threat; that Providence could be trusted to do for us what we would not do for ourselves.

No, these were calls to come to the defense of the common future. They were calls upon the courage, generosity and strength of entire peoples, citizens of every class and condition who were ready to stand against the threat once asked to do so. Our enemies in those times calculated that free people would not rise to the challenge; they were, of course, catastrophically wrong.

Now comes the threat of climate crisis – a threat that is real, rising, imminent, and universal. Once again, it is the 11th hour. The penalties for ignoring this challenge are immense and growing, and at some near point would be unsustainable and unrecoverable. For now we still have the power to choose our fate, and the remaining question is only this: Have we the will to act vigorously and in time, or will we remain imprisoned by a dangerous illusion?

Mahatma Gandhi awakened the largest democracy on earth and forged a shared resolve with what he called “Satyagraha” – or “truth force.”

In every land, the truth – once known – has the power to set us free.

Truth also has the power to unite us and bridge the distance between “me” and “we,” creating the basis for common effort and shared responsibility.

There is an African proverb that says, “If you want to go quickly, go alone. If you want to go far, go together.” We need to go far, quickly.

We must abandon the conceit that individual, isolated, private actions are the answer. They can and do help. But they will not take us far enough without collective action. At the same time, we must ensure that in mobilizing globally, we do not invite the establishment of ideological conformity and a new lock-step “ism.”

That means adopting principles, values, laws, and treaties that release creativity and initiative at every level of society in multifold responses originating concurrently and spontaneously.

This new consciousness requires expanding the possibilities inherent in all humanity. The innovators who will devise a new way to harness the sun’s energy for pennies or invent an engine that’s carbon negative may live in Lagos or Mumbai or Montevideo. We must ensure that entrepreneurs and inventors everywhere on the globe have the chance to change the world.

When we unite for a moral purpose that is manifestly good and true, the spiritual energy unleashed can transform us. The generation that defeated fascism throughout the world in the 1940s found, in rising to meet their awesome challenge, that they had gained the moral authority and long-term vision to launch the Marshall Plan, the United Nations, and a new level of global cooperation and foresight that unified Europe and facilitated the emergence of democracy and prosperity in Germany, Japan, Italy and much of the world. One of their visionary leaders said, “It is time we steered by the stars and not by the lights of every passing ship.”

In the last year of that war, you gave the Peace Prize to a man from my hometown of 2000 people, Carthage, Tennessee. Cordell Hull was described by Franklin Roosevelt as the “Father of the United Nations.” He was an inspiration and hero to my own father, who followed Hull in the Congress and the U.S. Senate and in his commitment to world peace and global cooperation.

My parents spoke often of Hull, always in tones of reverence and admiration. Eight weeks ago, when you announced this prize, the deepest emotion I felt was when I saw the headline in my hometown paper that simply noted I had won the same prize that Cordell Hull had won. In that moment, I knew what my father and mother would have felt were they alive.

Just as Hull’s generation found moral authority in rising to solve the world crisis caused by fascism, so too can we find our greatest opportunity in rising to solve the climate crisis. In the Kanji characters used in both Chinese and Japanese, “crisis” is written with two symbols, the first meaning “danger,” the second “opportunity.” By facing and removing the danger of the climate crisis, we have the opportunity to gain the moral authority and vision to vastly increase our own capacity to solve other crises that have been too long ignored.

We must understand the connections between the climate crisis and the afflictions of poverty, hunger, HIV-Aids and other pandemics. As these problems are linked, so too must be their solutions. We must begin by making the common rescue of the global environment the central organizing principle of the world community.

Fifteen years ago, I made that case at the “Earth Summit” in Rio de Janeiro. Ten years ago, I presented it in Kyoto. This week, I will urge the delegates in Bali to adopt a bold mandate for a treaty that establishes a universal global cap on emissions and uses the market in emissions trading to efficiently allocate resources to the most effective opportunities for speedy reductions.

This treaty should be ratified and brought into effect everywhere in the world by the beginning of 2010 – two years sooner than presently contemplated. The pace of our response must be accelerated to match the accelerating pace of the crisis itself.

Heads of state should meet early next year to review what was accomplished in Bali and take personal responsibility for addressing this crisis. It is not unreasonable to ask, given the gravity of our circumstances, that these heads of state meet every three months until the treaty is completed.

We also need a moratorium on the construction of any new generating facility that burns coal without the capacity to safely trap and store carbon dioxide.

And most important of all, we need to put a price on carbon — with a CO2 tax that is then rebated back to the people, progressively, according to the laws of each nation, in ways that shift the burden of taxation from employment to pollution. This is by far the most effective and simplest way to accelerate solutions to this crisis.

The world needs an alliance – especially of those nations that weigh heaviest in the scales where earth is in the balance. I salute Europe and Japan for the steps they’ve taken in recent years to meet the challenge, and the new government in Australia, which has made solving the climate crisis its first priority.

But the outcome will be decisively influenced by two nations that are now failing to do enough: the United States and China. While India is also growing fast in importance, it should be absolutely clear that it is the two largest CO2 emitters — most of all, my own country — that will need to make the boldest moves, or stand accountable before history for their failure to act.

Both countries should stop using the other’s behavior as an excuse for stalemate and instead develop an agenda for mutual survival in a shared global environment.

These are the last few years of decision, but they can be the first years of a bright and hopeful future if we do what we must. No one should believe a solution will be found without effort, without cost, without change. Let us acknowledge that if we wish to redeem squandered time and speak again with moral authority, then these are the hard truths:

The way ahead is difficult. The outer boundary of what we currently believe is feasible is still far short of what we actually must do. Moreover, between here and there, across the unknown, falls the shadow.

That is just another way of saying that we have to expand the boundaries of what is possible. In the words of the Spanish poet, Antonio Machado, “Pathwalker, there is no path. You must make the path as you walk.”

We are standing at the most fateful fork in that path. So I want to end as I began, with a vision of two futures – each a palpable possibility – and with a prayer that we will see with vivid clarity the necessity of choosing between those two futures, and the urgency of making the right choice now.

The great Norwegian playwright, Henrik Ibsen, wrote, “One of these days, the younger generation will come knocking at my door.”

The future is knocking at our door right now. Make no mistake, the next generation will ask us one of two questions. Either they will ask: “What were you thinking; why didn’t you act?”

Or they will ask instead: “How did you find the moral courage to rise and successfully resolve a crisis that so many said was impossible to solve?”

We have everything we need to get started, save perhaps political will, but political will is a renewable resource.

So let us renew it, and say together: “We have a purpose. We are many. For this purpose we will rise, and we will act.”

Written by William DiBenedetto

April 22, 2009 at 7:39 am

Clean tech investment drops dramatically

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cleantech1Clean technology venture investments in North America, Europe, China and India plummeted in the first quarter to about $1 billion across 82 companies, according to the Cleantech Group and Deloitte, the global auditing, tax, consulting and financial advisory services firm.

Cleantech investment in the first quarter plunged 41 percent from the previous quarter, and was down even further, by 48 percent compared to the last year’s first quarter.

Cleantech venture investments have declined for two consecutive quarters since peaking at $2.6 billion in the third quarter last year. This represents the lowest level of venture capital investment in clean technology companies in two years. The average round size has contracted from $20 million in 3Q08 to $12.3 million in the first quarter.

“Cleantech financing is moving into a new phase, characterized by diversified funding sources, as the global recession and liquidity issues impact venture investors. Venture funds continue to invest significant sums, albeit at a slower pace and smaller scale than in the past two years,” says Brian Fan, Cleantech Group’s senior director of research.

Global governments are trying to take up the slack. They are “allocating historic amounts of capital to clean technologies through stimulus packages, loan guarantees and tax incentives, which will enable the cleantech industry to continue to develop,” says Cleantech and Deloitte.

A report titled ‘Towards a Global Green Recovery’ presented at the G20 Summit in London earlier this month estimated that almost $400 billion of about $2.6 trillion in economic stimulus allocations announced so far by G20 nations are earmarked for clean technologies such as renewable energy, improved electrical grids and cleaner cars.

In addition utilities and corporations are increasingly playing a leadership role in developing the sector. “Governments are not the only significant new investors in cleantech…Utilities are also stepping up to fill the funding void and making equity investments in companies,” says Scott Smith, Leader of CleanTech for Deloitte. “Investment plans range from building and operating solar and wind systems to financing third party, shovel-ready projects. These moves underscore cleantech’s emergence as a significant and maturing market that will remain highly relevant—both during and following the economic downturn.”

The leading investment areas from the quarter were solar, biofuels, advanced batteries and electric vehicles:

  • Solar – $346 million
    Deals included Norsun, a Norwegian polysilicon producer, which raised a $72 million round led by Good Energies. Concentrated PV startup SolFocus raised $67 million from Apex Venture Partners, NEA and NGEN. Solar service provider Solar Power Partners raised $47 million, and thin-film startup Sierra Solar Power raised $40 million.
  • Biofuels – $96 million
    Deals included BioMCN, which has developed a process to convert crude glycerine, a byproduct of biodiesel, into methanol. It raised $46 million from Waterland Private Equity. Cellulosic ethanol company ZeaChem raised a $34 million round led by Globespan Partners and Prairie Gold Venture Partners.
  • Advanced batteries – $94 million
    Deals included lithium-ion startup Boston Power, which raised a $55 million round led by Swedish investor Foundation Asset Management. Boston Power’s Sonata batteries were chosen by HP for nearly 70% of its consumer line of notebooks. UK-based Nexeon raised over $14 million from Invesco Perpetual and others for its silicon anode technology for lithium-ion batteries, while Swiss startup ReVolt Technology raised over $13 million for its Zinc-air battery technology for consumer electronics devices
  • Electric vehicles – $78 million
    Deals included Dutch transmission manufacturer Fallbrook Technologies, which raised $25 million from NGEN Partners and Robeco. Scuderi Group raised $20 million for its split cycle internal combustion engine, PHEV manufacturer Bright Automotive raised $11 million from White Pines Partners and Duke Energy, and Smith Electric Vehicles, which manufactures electric trucks and vans, raised $10 million.

Clean technology mergers and acquisitions totaled an estimated 111 transactions in the first quarter, of which totals were disclosed for 25 transactions totaling $3.0 billion. This is down 42 percent from the fourth quarter, which saw 134 M&A transactions, of which 45 were disclosed for a total of $4.8 billion.

Cleantech Group noted four cleantech IPOs in the first quarter, three in China and one in Switzerland. The largest deal was China Singyes Solar Technologies Holdings Ltd, a solar service provider, which raised $8.1 million on the Hong Kong Futures Exchange.

North America accounted for 68 percent of the total, while Europe and Israel accounted for 28 percent, China for 2 percent, and India for 1 percent.

  • Europe: European and Israeli companies raised $281 million in 31 disclosed rounds, down 11% from 4Q08 and down 31% from 1Q08. Despite the overall reduction in amount invested, Europe and Israel increased its proportion of overall global investment to 28%, up from 19% in 4Q08 and 21% in 1Q08.
    The largest deal was a $71.6 million round for Norwegian solar company Norsun, one of the top ten largest deals ever in Europe and Israel, and pulled Norway ($79.2 million in 4 deals) into first position in the country rankings in Europe. The UK was second ($52.9 million, 11 deals) and the Netherlands third (where BioMCN’s $46 million round was the only investment of disclosed value).
  • China: In 1Q09, two Chinese companies, solar equipment company Jiangyin Aikang Solar Equipment Co., and Shanghai Insuring Polymer Materials Co., Ltd. raised USD $21.5 million.
    There were seven M&A deals in China totaling USD $517.5 million; three of these transactions were joint ventures between Chinese companies and multinationals. Cleantech Group noted three cleantech IPOs in China in 1Q09: China Singyes Solar Technologies Holdings Ltd on the Hong Kong stock market, heat exchange manufacturer SmartHeat on NASDAQ, and sustainable fertilizer manufacturer China Green Agriculture Inc. on AMEX.
  • India: In 1Q09, a total of $54 million was invested across 3 deals, out of which one company did not disclose the amount. Jain Irrigation, India’s largest provider of micro-irrigation systems; Sri Biotech, an agri-biotech company and Polygenta all received funding in the quarter. Active investors include IFC, Rabo Equity and Aloe Private Equity. ACME Group, an India-based telecom power solutions company also made an overseas investment of $30 million in California-based eSolar and PAE acquired a strategic stake in Shurjo Energy, a solar panel manufacturer, for $10 million.
    Despite the low investment amount and number of deals recorded in the region, the renewable energy sector in India continues to be very active.  Major Indian companies, such as Tata Power, BHEL and Greenko Group, announced initiatives to ramp up investment in clean energy projects across the country. Several Indian state governments in India also announced policies this quarter to increase the use of solar power and biomass for energy generation.

Cleantech Group’s free download!

Just in time for Earth Day Cleantech Group is offering a free download of its 2008 Annual Review of the Cleantech Sector. It’s publicly available for the first time as a “special gesture” this week. Click here to download the review.

Written by William DiBenedetto

April 21, 2009 at 10:55 am

Renew Energy has plant for sale; BioEnergy Development opt for biomass

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Renew Energy could close Wisconsin plantrenewenergy

Ethanol producer Renew Energy LLC, which filed for Chapter 11 protection under the US Bankruptcy Code in late January, announced today that it will close or sell its 130 mgy ethanol plant in Jefferson, WI if a buyer cannot be found. The sale or closure will take effect between May 18 and May 31, the company said, and would likely result in the layoff of the plant’s entire workforce of 80.

The company is a Wisconsin limited liability company with five members, each holds a 20 percent interest in the company.

For its most recent fiscal year, Renew Energy generated revenue of about $184 million. As of the Jan. 30 bankruptcy filing, it had liabilities of more than $150 million (of which $37 million is unsecured trade debt). It retained William Blair & Company L.L.C. to assist in locating lenders for a DIP facility and in soliciting purchasers of the company’s assets.  In the interim, the company had negotiated a temporary DIP facility in the amount of $2.5 million from West Pointe Bank.


biofuel3BioEnergy Development goes with biomass

BioEnergy Development Company, based in Fishers, IN, said late Friday that it signed a letter of intent with an area utility company and secured land options for the development and construction of a biomass electric generation plant.

The proposed plant BioEnergy Power LLC, will be located on a coal strip mine site in Clay County. The plant is expected to employ 25 to 30 full time workers upon completion.

The new plant will generate approximately 27 megawatts of electricity from wood waste that was previously provided to a paper plant in Terre Haute. The plant closed in 2007; subsequently, a Purdue University study funded by the Indiana Energy Department identified “green” energy production as the highest and best of use of wood wastes.

BioEnergy is in negotiations with a wood waste aggregator to supply the plant. Most wood waste for the plant will come from within a 100-mile radius of the proposed site. According to the U.S. Forest Service, the $17 billion per year Indiana hardwood industry has generated 1.2 million tons of annual waste for the past 25 years.

To qualify for green energy credits issued by the Environmental Protection Agency, and to be certified by the U.S. Department of Energy, this plant will use only wood waste and other renewable waste biomass in power generation. To further lower the plant’s carbon footprint, BioEnergy Development is in discussions with other companies to capture carbon dioxide for use in developing other types of energy.

BioEnergy Power LLC said it intends to complete the permitting process and begin construction by fall, 2009 complete construction by the end of 2010.

Written by William DiBenedetto

April 20, 2009 at 10:38 am

Aventine gets bucks, Buckeye boosted by biomass, a call to action

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Bankruptcy court approves first $15 million in new financing for Aventine

Ethanol producer Aventine Renewable Energy, said a U.S. Bankruptcy Court gave interim approval to a debtor-in-possession financing package, thus permitting the company to access a first tranche of $15 million in financing, This will allow the company to move forward with payments to suppliers and employees, it said.

Aventine, based in Pekin, IL, filed to reorganize under Chapter 11 on April 7 to reorganize and restructure its debt with its bondholders. The DIP term sheet names Brigade Leveraged Capital Structures Fund, Ltd., Nomura Corporate Research & Asset Management, Inc., as the investment manager for and on behalf of certain lenders, Whitebox Hedged High Yield Partners, L.P., Pandora Select Partners, L.P. (as lenders), Aventine Renewable Energy, Inc., Aventine Renewable Energy – Mt Vernon, LLC, and Aventine Renewable Energy – Aurora West LLC on a joint and several basis as debtors in possession under Chapter 11.

A hearing is scheduled for May 5th on the total $30 million DIP package.

Buckeye generates 79 percent on energy needs from biomass

biomasimageIn its recently-released sustainability report for 2008 Buckeye Technologies, the Memphis manufacturer and marketer of specialty fibers and non-woven materials, says it has reduced its GHG emissions by 15 percent per ton of production since 2003 while generating 79 percent of its total energy needs from renewable biomass.

Buckeye’s first sustainability report also has information about the company’s social impacts, including safety, diversity, and contributions to communities where it operates.

Click here to view the report.

Call to action on building a sustainable future

A draft report from the National Science Board calls on the U.S. to “develop, clearly define, and lead a nationally coordinated research, development, demonstration, deployment, and education (RD3E) strategy to transform the U.S. energy system to a sustainable energy economy that is far less carbon-intensive.”

One of the key findings in the report says the level of federal support for sustainable energy research and development is inadequate to meet the scale and scope of the challenges for achieving sustainable energy solutions.

Another perhaps inconvenient finding is that the current energy economy “does not adequately value or reward the attributes of sustainable energy solutions relative to those for the use of non-sustainable energy.”

Dan Arvizu, co-chairman of the NSB’s Task Force on Sustainable Energy as well as head of the National Renewable Energy Laboratory (NREL) said that the measures recommended “can help to promote national security by increasing U.S. energy independence, ensure environmental stewardship by reducing energy and carbon intensity, and generate continued economic growth through innovation in energy technologies and increases in green jobs.”

The group called for the establishment of a Presidential Sustainable Energy Council to coordinate all federal activities in sustainable energy, boost R&D spending, develop stable policy, lead globally and bolster science and technology education.

The 25-member National Science Board is the policy-making body for the National Science Foundation and advises the President and Congress.

Other findings:

• The U.S. government must adopt a forward-looking, long-term, coordinated strategy for achieving a stable, sustainable, and clean energy future.

• The U.S. must substantially increase efforts in education and workforce development related to sustainable energy research and technology development and deployment.

• Limited international engagement and collaboration on sustainable energy solutions are inhibiting progress toward critical multilateral and bilateral actions.

• The U.S. Government should promote national public awareness of sustainable energy solutions, energy consumption, and energy efficiency.

Click this to view the report.

Written by William DiBenedetto

April 17, 2009 at 8:52 am

Sustaining sustainability

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cocoaOn the corporate sustainability front there are signs that that it is moving beyond mere PR and blue-sky vibes. It might even be true, descending at last from somewhere past Mars on the corporate visibility scale to an Earth-based reality.

Speaking of Mars — the candy company of the same name, that is — it has claimed it is the “first global chocolate company to commit to fundamentally changing the way sustainable cocoa farming practices are advanced by aiming to certify” that its entire cocoa supply is produced in a sustainable manner by 2020.

It wants to achieve this through collaboration with the Rainforest Alliance, an international non-profit. They unveiled new goals in their ongoing campaign to help cocoa farmers get on the path toward sustainability. They agreed to redouble efforts to help thousands of farmers meet holistic social and environmental standards so that their farms could earn Rainforest Alliance certification.

Near-term, Mars aims to buy enough certified cocoa so that the Galaxy chocolate bar, for example, which is highly popular in the United Kingdom, can bear the Rainforest Alliance Certified green seal of approval by early 2010. galaxy-chocolate


The Rainforest Alliance accepted the company’s challenge to bring enough farms up to code so that 100,000 tons of Rainforest Alliance Certified cocoa would be available each year by 2020.

Let’s hope it’s aim is true. Mars says this is the “latest milestone in a long-running sustainability effort,” and demonstrates a “real commitment” to sustainable farming.

“Mars’ commitment to buying sustainable cocoa is unprecedented in size and scope, and the benefits to farmers, farmworkers, tropical environments and wildlife will be tangible,” says Tensie Whelan, president of the Rainforest Alliance. “This initiative is an example of the tremendous impact global companies can have when they commit to sustainability.”

Another indicator that sustainability is becoming serious business in corporate boardrooms came recently from the non-profit Center for Sustainable Innovation, which released a new model for measuring corporate sustainability performance.

true-sustainability-index2It’s called the True Sustainability Index. CSI’s model comprises 15 indicators that sustainability managers can use to assess the full triple bottom line performance of their organizations. TSI says the model will be useful in their attempts to understand, rate and rank the sustainability performance of organizations as a basis for making investment decisions.

The model features indicators and metrics that track or measure organizational greenhouse gas emissions, an organization’s impacts on air quality, water use, non-water natural resources, organizational emissions of solid wastes, impacts on ecosystem habitats, flora, fauna and biodiversity. Another set of indicators assesses an organization’s impacts on human capital, its contributions to creating and maintaining social institutions, social infrastructure and livable wages.

Unlike other sustainability indexes and there are many of them around, the TSI is made up of metrics that are context-based, meaning that they express organizational performance relative to actual social and environmental conditions in the world. Water consumption, for example, is measured against renewable supplies; solid wastes are measured against landfill capacities; and impacts on social and economic conditions are measured against societal needs. The model released that was released late last month “is an early prototype – an 80-percent solution – and remains a work in progress,” CSI says.

CSI’s context-based approach to measuring and reporting organizational sustainability stands in stark contrast to other mainstream reporting methods and indexes, most of which are context-free.

Even the Global Reporting Initiative (GRI), which advocates for the inclusion of sustainability context in related reports, fails to provide firm guidelines on how to do so. Most, if not all, GRI reports are therefore “devoid of context,” according to CSI, and “rarely make it possible to understand the true sustainability performance of the organizations they describe.”

Perhaps the time is right for sustainability. A recent survey from the American Marketing Association and Fleishman-Hillard, Inc. found that nearly 60 percent of corporate marketers expect their companies to increase environmental sustainability initiatives over the next two or three or years. Also, one-half of those surveyed said current economic conditions will encourage the adoption of sustainability practices. Click here for their survey report.

The key is that for the sustainability impetus to sustain itself further it has to move beyond the prototype stage, with clear and universally accepted guidelines and standards. TSI looks like a great step. Give ‘em a chocolate bar.

Written by William DiBenedetto

April 16, 2009 at 12:41 pm

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