Friday, March 09, 2007

Part 3: Live from the Power-Gen Renewable Energy & Fuels Conference

Dave Vender Griend, President and CEO of ICM, a Kansas-based company with the mission to “turn agriculture products into renewable energy” has a rosy outlook for biofuels and particularly corn ethanol.

Although the past few decades have been a roller coaster for ethanol, Vender Griend is seeing more market stability and continued growth. Emissions have been reduced by a factor of 5 over the past 2-3 years, and President Bush’s target of cutting gasoline consumption by 20 percent will continue to drive ethanol production (although many have criticized the plan as unrealistic, including the U.S. General Accounting Office).

Opportunities for ethanol include plant siting. The raw materials for ethanol (mostly corn) are primarily in rural areas of the Midwest, but the need for power is in large urban areas and particularly on the coasts. Vender Griend sees a shift to “destination plants” – putting them where the people are. He claimed that this results in less carbon dioxide emissions, although he didn’t elaborate on that point and I don’t understand why emissions are lower.

Because the ag economy is going well, Vender Griend is optimistic about the United States’ economy. He posited that when ag is doing well, the national economy sees a boom 3-5 years down the road. Right now there is strong economic growth in the ag sector and so he is positive about the direction of the national economy.

Corn prices are going up, but Vender Griend doesn’t think that should make people wary of more ethanol. If the cost of corn doubled, the price of a box of cereal would go up just 5 cents. Are you willing to pay a nickel more for biofuels and sustainable agriculture?

I was surprised by the short amount of time Vender Griend spent on the diversification of biofuels. He mentioned that cellulosic ethanol seems to hold the most promise for the future of biofuels and is probably the next biggest fuel market for the U.S. To grow that market, the U.S. needs to increase its standards for renewable fuels and provide tax incentives to the industry.

For more coverage of the Conference, see Part 1 here and Part 2 here.

Photo credit: ICM

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