KansasRenewables Today

Current Ethanol ProductionNine plants -- 270.5 million gallon capacity.

They consume 96 million bushels of grain sorghum and corn. (About half our ethanol is made from sorghum)

Ethanol Production Today

• Five plants now under construction.

• Will add 245 million gallons of production.

• Combined Kansas sorghum and corn production around 640 million bushels.

• Robust beef industry provides markets for distillers grains. Many buy the product wet.

Ethanol ByproductsRobust beef industry provides markets for

distillers’ grains.

Many plants buy the product wet, saving energy costs.

Tensions between beef industry and ethanol can be worked out.

Coming—possible regulation of DDGs as a feed; consistency of product.

Infrastructure

• Need for more stations—currently 21 E85 fueling stations.

• Now possible to cross Kansas east to west on E85 fuel.

• Biodiesel readily available.

• Questions about biodiesel testing and standards keep coming up.

Other Renewables• The first small biodiesel plant began

producing in June in Sedgwick, KS.

• One sizeable plant under construction.

• Three with permits pending.

• Cellulosic plant soon to begin construction at Hugoton and another under consideration by ICM.

DOE Grant Facility• Abengoa plans construction of a cellulosic and a

conventional ethanol plant at Hugoton. Partial funding from a $76 million DOE grant.The traditional plant will produce 85 million gallons a year; the cellulosic, about 30 million gallons.

• Fractionation and various treatments separate cellulose, hemicelluloses and lignin. The first two are destined to be fermented and lignin will be a coproduct. Biomass particles are “popped” by heat to let enzymes penetrate the molecule. Fermentation creates ethanol.

ICM and Cellulosic Ethanol

• Edenspace Systems Corporation and ICM have agreed to collaborate on variety development of corn, switchgrass and other crops optimized for the production of cellulosic ethanol.

• Edenspace is a research company that recently moved part of its work to Kansas.

• ICM is seeking a $30 million 10 percent DOE grant for a plant 10 percent the size of a commercial plant.

• Their goal? Production-scale cellulosic ethanol process by 2012.

Selected Kansas Energy Incentives

• Alternative fuel tax credit provides a tax credit to purchasers of alternative fuel vehicles.

• Biomass to energy plant income tax credit for construction of expansion of plants.

• Ethyl Alcohol production incentive provides $0.05 per gallon on the first 15 million gallons produced per year.

• Biodiesel Fuel production incentive provides a $0.30 per gallon incentive for producers.

• Cellulosic alcohol income tax credit for investors.

Kansas Incentives, cont.

•Ag value added loans help fund feasibility studies.•Carbon dioxide reduction incentives for underground storage of carbon through property tax exemptions.•State agencies required to purchase E85 vehicles if cost is not excessive.•New law provides a monetary incentive (per gallon) for fuel dealers to sell renewable fuels based on a percentage of sales.•Income tax credit for installation of alternative fuel stations.