Archive for the ‘Biofuels’ Category

Renewable Tax Credits Extended, Finally

Friday, October 3rd, 2008

As the financial bailout measure was passed by Congress today, several tax credits were added to the bill, including an extension of renewable energy tax credits.  These tax credits have been bouncing back and forth in Congress all year.  However one feels about the rest of the bailout bill, these tax credits are good news for renewable energy; there must be a great number of relieved renewable energy workers celebrating tonight.  The measure includes an 8 year extension of the investment tax credit for solar electric systems, extending the 30% tax credit and removing the $2000 cap on the credit for residential systems that has limited the impact in this market.  The measure also includes credits for small wind, fuel cells and geothermal systems. 

The on-again off-again nature of these credits in the past with short term extensions that were allowed to expire has limited their impact.  Now with an 8 year extension in place the industry can plan and invest for long term growth with this piece of their financial picture more secure, encouraging their growth around the country. 

At West Coast Green  (September 25-27) I talked about the tax credits with Gary Gerber, the CEO of Sun Light and Power, a San Francisco Bay Area solar installer.  With this type of longer term policy supporting solar power nationwide, Gerber felt we would see solar grow beyond states like California with strong support for solar such as the Million Solar Roofs Initiative, creating renewable energy businesses and jobs across the country.

Its hard to say that anybody is completely unaffected by the broader economic situation, but Gerber said that he has “not heard or seen anything that says we are negatively affected.” 

“We are in the business of saving people money,” he went on to say, a good business to be in when the economy is down. 

Several other measures in the bill also support renewable energy, including a one year extension of production tax credits for solar and wind, incentives for biofuels, and the creation of energy conservation bonds to fight climate change and encourage energy efficiency measures.  The Cleantech Practice Group of Morrison & Foerster compiled a nice summary of these measures.  In the days that follow after people get a chance to read the bill through more closely we’ll hear more about its impact.

One of the lessons of our current financial situation is that free markets cannot be left unregulated and expected to move in a direction that is beneficial to the long term interests of society and the economy.  The same is true of the environment.  Government plays an important role in regulating industry, driving changes that are beneficial to us all.  These measures to support renewable energy are an important example of this, creating a multitude of jobs and businesses, helping the economy, and helping the planet.

Pumping Ethanol

Tuesday, July 22nd, 2008

Although some might think that high gas prices spell money for gas stations, one casualty of the high price of oil has been independent gas station owners.  While independent gas station owners are generally able to buy fuel at low prices on the open market, lower than branded gas stations, in recent months they have been consistently forced to buy fuel at higher prices, causing them to lose money or even close in some cases.

From the San Diego Union-Tribune, June 24 2008:

Opportunity #67 in “75 Green Businesses” is to establish alternative fueling stations.  If fueling our cars is going to transition away from oil, they need something to transition to.  Millions of flex-fuel cars have been sold in the US that can run on ethanol, but most of them don’t; their owners power them with gasoline because ethanol is not readily available where they live or they don’t use it. 

Pearson Fuels in San Diego ( provides a variety of alternative automobile fuels, including ethanol, biodiesel, propane and natural gas.  Mike Lewis, the co-owner of Pearson Fuels, reports that ethanol sales are up, and that ethanol has provided a better margin than gas for station owners in this difficult time period.  “E85 sales are at record levels due to the price differential between E85 and gasoline,” Lewis says.  Pearson Fuels is helping other stations to go through the California permitting process for pumping ethanol, and he has also seen an increase in the number of station owners who want to work with them to start pumping ethanol themselves.

And where is the price of gasoline headed?  Lewis has a pretty good perspective on this question:

“The price will go up and down and I have no idea, nor does anyone else, what the price will do next week, month or year. However, before all the hairs on my 42 year old head are gray, $10.00 per gallon. The bottom line is that we know what is going to happen to demand over the next 20 years and we know that oil is a finite resource. It is really pretty straightforward to figure out what those two things interacting will do to the price.” 

In the short term, no expert can say what is going to happen.  In the long run though, it is inevitable that oil, gas, and diesel will get more expensive. 

The Biodiesel Coop Next Door

Sunday, July 6th, 2008

Many people are engaged in the search for new renewable energy alternatives to the use of oil to provide fuel for our cars and trucks.  The high cost of oil is hitting a lot of people in their pocketbooks, accelerating the urgency of the quest.  Some are even taking matters into their own hands, producing their own fuel with small scale “backyard” biodiesel producing from used vegetable oil (Opportunity 3 in 75 Green Businesses).

Recently I found out that my neighbor is helping to build a biodiesel coop with 20 other like-minded Southern Californians.  With the high price of gasoline, particularly diesel, this is no surprise  - the surprise is that there are not more people doing this. 

One key is getting a reliable source of used vegetable oil from a local restaurant.  Another key is figuring out how to process it.  Finally, the coop is figuring out how to structure itself to produce and use the fuel.

One interesting trend my neighbor told me about is that the quality of cooking oil from restaurants is declining, with the oil getting used more.  With dirtier oil, the biodiesel produced from it can also be dirtier if it is not cleaned up before it is used.  To clean the oil, people like my neighbor are increasingly adapting centrifugation systems used to purify fuel for ships.  This trend appears to be spreading through the biodiesel community, providing reliable, cost effective biodiesel production more readily than other methods like filtration.

Over time some biodiesel coops like Piedmont Biofuels ( expand to produce fuel to the public, sustaining themselves from the proceeds.  If the cost of oil stays high, or goes higher, biodiesel producers large and small will have their hands full keeping up with demand.