Sudhir Seth
President & CEO
BioFuels Manufacturers of Illinois, LLC.
801 West Main St.
Peoria, Illinois 61606
P:309-495-7249
F:309-495-7250
C:650 776 5443
seth@biofuelsillinois.com
Serin R. Rao, P.E., MBA
Chief Operating Officer
BioFuels Manufacturers of Illinois, LLC.
801 West Main St.
Peoria, Illinois 61606
P:309-495-7249
F:309-495-7250
C:309-287-8391
Promising biodiesel crop fails to spark Energy Department excitement.
Martin Ross
Farmweeknow.com
Published: Nov 15, 2009
Renewable energy is an answer to waning fossil resources. It’s also a growing business concern, and that may be key to helping bioenergy innovations come to market.
In late October, the U.S. House passed the Small Business and Investment Act, including an amendment by Peoria Republican Rep. Aaron Schock that requires quarterly progress reports on the Small Business Administration’s (SBA) newly overhauled Renewable Energy Capital Investment Program.
Schock cited Peoria-based Biofuels Manufacturers of Illinois’ (BMI) challenges in obtaining capital investment or loans for further development of pennycress, a winter oilseed crop with promising potential for biodiesel production.
BMI has signed a handful of growers to raise pennycress, and hopes to process the crop through a 45-million-gallon-per-year biodiesel operation.
Schock argued the SBA matching grants program, properly structured, could provide small businesses “equal opportunity to participate in the effort to make our country become more energy efficient while also establishing new renewable fuel sources.”
As a winter annual, pennycress is “a great cover crop” that wouldn’t replace existing food crops, according to BMI’s Peter Johnsen, former director of Peoria’s USDA National Center for Ag Utilization Research (NCAUR). BMI estimates pennycress could generate 115 gallons of biodiesel per acre.
But while the federal government has many dollars invested in switchgrass and other cellulosic biomass crops, the U.S. Department of Energy (DOE) “doesn’t see pennycress on its radar,” Johnsen said.
Johnsen, who testified before Schock’s Small Business subcommittee, cited a three-year, $33 million DOE study focusing on energy crops and other biomass sources.
“At the end of three years and $33 million, they’re just going to have more information,” he told Illinois Farm Bureau representatives. “At the end of our (first) three years, we’re going to have a commercial process and be productive.
“If you gave us the $33 million, we’d actually have a full-scale production facility, probably getting ready to build a second one. We need to try to have DOE understand that this crop exists.”
Governor Quinn Signs Legislation to Support Energy Efficiency Projects New Law will Help Jump-Start Job Creation, Construction Projects
PEORIA – November 12, 2009. Governor Pat Quinn today signed legislation that provides a statebacked guarantee supporting construction of energy efficiency projects that will create jobs across Illinois. The backing expands a law Governor Quinn signed in July that created the same guarantee for renewable energy and clean coal projects in Illinois.
“This legislation boosts Illinois’ investment in energy efficiency projects that reduce our carbon footprint and create jobs,” said Governor Quinn. “I am proud to sign this law that will help continue to protect our environment while developing new green jobs for the twenty-first century.”
Senate Bill 1906 (Public Act 96-0103) clarifies the Illinois Finance Authority’s (IFA) existing bonding authority for renewable energy and clean coal projects. Senate Bill 0390 adds energy efficiency projects to those covered by the original bill.
The legislation will allow the State and IFA to work in partnership to make up to $3 billion in guaranteed energy project financing available for qualified renewable energy and clean coal efforts. In addition, the law increased the State and IFA’s loan guarantee from $75 million to $225 million for agricultural businesses. It also provided guarantees to back qualified renewable energy projects such as wind, biodiesel or biomass initiatives that are related to agriculture.
In addition, the law positions Illinois to compete for federal stimulus loan guarantees designated for the new green projects.
The IFA is a self-financed state authority principally engaged in issuing taxable and tax-exempt bonds, making loans, and investing capital for businesses, non-profit corporations, agriculture and local government units statewide. For more information: www.il-fa.com.
By PAUL MERRION
Publication: Crain’s Chicago Business Date: Monday, October 19, 2009
Stinkweed smells sweet to former Caterpillar Inc. CEO Glen Barton.
Mr. Barton is chairman and one of several Peoria-area investors in a local startup, Biofuel Manufacturers of Illinois LLC, which plans to build a $40-million factory near Peoria next year that can make biodiesel out of just
about anything, from soybeans to animal fats to stinkweed—a wild plant growing throughout Illinois that’s more formally known as field pennycress.
Despite heavy government support, similar biofuel factories are struggling, but BMI’s plan to use pennycress as one of its main raw materials could give it an edge.
“It’s a novel idea,” says Mr. Barton, a lifelong Cat executive who successfully led the global heavy-equipment maker through five turbulent years before exiting in early 2004 near the firm’s mandatory retirement age of 65. “I’m involved because I like novel ideas.”
Backers say pennycress has advantages over soybeans, the most common biodiesel feedstock now. In addition to having twice the oil content of soybeans, it stays liquid at much lower temperatures than diesel made from soybeans or animal fats.
But the biggest plus is that pennycress germinates after corn is harvested and lies dormant during the winter, sprouting in the spring before soybeans are planted.
That means farmers can produce the plant’s inedible oil between existing crops, averting the food-for-fuel problem that threatens the growing use of corn and soybeans to make alternative fuels. It also avoids the clearing of forests and fields to make more biofuel, which would negate much of the environmental benefit.
Last but not least, using idle land puts extra money in farmers’ pockets, like adding a second shift at a factory, Mr. Barton notes. “It’s a win-win-win for a lot of people, including planet Earth.”
BMI estimates that its 45-milliongallon-a-year plant, which needs a $25-million state loan guarantee to begin construction, will inject $100 million a year into the Illinois farm economy, and the state has enough cropland to support about 18 to 20 such plants.
The company expects to make about three times as much biofuel per acre compared to soybeans. That assumes it can use the remainder of the pennycress seed, after the oil is removed, to make more biofuel, using a process it is seeking to patent.
“When that discovery was made, it excited us beyond anything that’s happened so far,” says BMI CEO Sudhir Seth, a native of India who was a computer consultant in New York before moving to Peoria three years ago to live closer to his parents.
Harvesting will use existing farm equipment. “The only investment the farmer has to make is to buy duct tape,” says Peter Johnsen, BMI’s chief technology officer. Farmers need only patch holes or cracks in bins and trucks to keep the tiny seeds from falling through.
Making biodiesel from soybeans is barely profitable at current oil prices, even with a $1-per-gallon federal subsidy, but it will cost about 50 cents a gallon less to make it from pennycress. Within five years, it could be profitable even without subsidies, says BMI’s Mr. Seth, as farmers learn how to grow more pennycress per acre and reduce its cost.
But it’s no simple matter to turn a weed into a cash crop. First, you need seeds. BMI has enough to plant 1,800 acres of pennycress, but its biodiesel plant eventually will require 500,000 acres to supply its needs. Lousy weather has delayed harvesting of this year’s crop of corn, and it will soon be too cold for pennycress to germinate and take root before winter.
Beyond that, “farmers won’t take the risk of planting a crop they can’t get insured,” says Peoria’s freshman Republican congressman, Aaron Schock. Weeds don’t qualify for federal crop insurance, but he’s been urging the U.S. Department of Agriculture to cover it under the Noninsured Crop Disaster Assistance Program.
If pennycress takes off, engineering a better variety should be worth the cost. Pennycress is a cousin of the much-studied mouse-ear cress, the first genetically mapped plant due to its simplicity. “It’s the fruit fly of the plant world,” says Jason Hill, resident fellow at the University of Minnesota, who did his doctoral thesis on it. “It’s an easy plant to modify.”
Mr. Hill also co-authored a National Science Foundation paper on the total life-cycle costs and benefits of alternative fuels, which concluded that corn-based ethanol creates only 25% more energy than it takes to produce, while soy-based biodiesel creates 93% more. Using pennycress, he says, could be even more cost-effective.
“I certainly applaud them for looking at ways to use our cropland more efficiently,” Mr. Hill says. “But how is it going to scale up?”
That’s where Mr. Barton lends BMI credibility, he adds. “It doesn’t get much bigger scale than Caterpillar.”
Copyright 2009 Crain Communications Inc. All Rights Reserved.
Aiming to bolster Illinois’ “green” economy, Gov. Pat Quinn on Wednesday signed into law a plan that makes available an extra $300 million in funding for renewable energy or clean coal projects.
“The key to prosperity in the 21st century is to have a green way of thinking and a green way of acting,” said Quinn, who described the measure as a “landmark piece of legislation.”
A couple of central Illinois companies, Biofuels Manufacturers of Illinois, LLC and Firefly Energy, are in good position to benefit from the new law, said Sen. David Koehler.
Koehler, D-Peoria, was the main Senate sponsor of the proposal, Senate Bill 1906. It expands the state’s bonding authority for those projects from $2.7 billion to $3 billion. Bonds provide a financing option for fledgling industries and attract businesses with strong potential for growth, officials said.
The new law also could enable the state to gain access to extra federal funding for the “green” initiatives.
Officials from BMI and Firefly, both in the Peoria area, said they’d seek some of the newly available funds. For example, Sudhir Seth, president and chief executive officer of BMI, said that company has a “shovel ready” $38 million project that will employ 150 construction workers and 24 full-time workers once the Mapleton biodiesel plant begins production.
Koehler said the new law will create jobs in Illinois that are part of “the future economy.”
“Certainly, I think it helps to give a real boost to some of the new energy startups and looks at how we can really tap into the green economy,” he said. “The state can’t afford not to do it because what helps the economy more than anything is to have more people working, more people paying taxes.”
The Illinois Finance Authority will screen applicants seeking funding.
“I am hoping that the line (of applicants) will be around the block,” IFA Chairman William Brandt said at a Chicago news conference where Quinn signed the bill.
Illinois Coal Association President Phil Gonet said the new law also allows existing coal-burning power plants to seek financing for improvements such as pollution control equipment.
The measure probably won’t affect the planned $3.5 billion Taylorville Energy Center, a coal-gasification project that aims to convert coal into synthetic gas to produce electricity.
Tenaska, the project’s managing partner, is pursuing a loan guarantee of up to $2.6 billion through the U.S. Department of Energy and has cleared a key hurdle in that process. Tenaska Vice President Bart Ford said if the company gets the DOE loan guarantee, as it believes it will, it would not seek IFA financing.
Adriana Colindres can be reached at (217) 782-6292 or adriana.colindres@sj-r.com.
Some local farmers got a look today at Central Illinois newest crop – Pennycress.
It’s harvest time for the oil rich Pennycress plant in Mapleton.
Biofuels Manufacturers of Illinois and the U–S Agricultural Research Lab say the 27–acre yield is the first of many for Central Illinois.
“This harvest this spring has really helped a lot of those questions about what’s the best time to plant and what’s the best conditions for growing and what’s the best time for harvest, “said B-M-I Chief Technology Officer Peter Johnsen.
Johnsen says the Pennycress is an ideal crop for farmers because it grows during the winter, on a different schedule from soybean and can be done on the same acreage. Oil from the pennycress can be converted to biodiesel fuel. B–M–I recently began collaborating with the AgGuild of Illinois in an effort to begin large scale commercial growing of Pennycress.
“We’ve still got some of the fertility questions to work on. But we see costs should be relatively inexpensive,” said AgGuild member Brad Glenn.
Right now the B–M–I is waiting to get a loan from the state before it can break ground later this summer for a plant to manufacture the fuel.
This is a crop which has been experimented. We have produced oil, we tested it and we’re going to try it out in the field, transport trucks.
B–M–I says with this new energy producing crop Illinois could reap in as much as 100–million dollars in economic benefits…once the plant is built and operating.
Pennycress expected to produce 60 million gallons of biodiesel
MAPLETON —
How times - and fuel demands - change.
The first commercial harvest of a plant once called “stinkweed” took place in a Mapleton field Friday, with supporters now referring to it as “wonderfuel.”
The weed in question is pennycress, a member of the mustard family with seeds that contain 36 percent oil - twice as much as soybeans. That much oil makes pennycress the perfect crop to blend with diesel fuel to make biodiesel, said officials of Biofuels Manufacturers of Illinois, LLC, a firm that plans to build a plant on the Mapleton site that is expected to produce 60 million gallons of biodiesel a year.
“No other sustainable energy crop has the potential that pennycress has,” said Sudhir Seth, president and CEO of BMI.
“This is a crop that does not obstruct the food chain. It has an estimated value of $125 to $175 per acre for farmers and we’re able to convert 80 percent of the plant to energy. In the long term, we anticipate pennycress will become a top biofuel source for biodiesel production,” said Seth.
Large tubs filled with 1,000 pounds of pennycress seed that were on display Friday will largely be used to plant thousands of acres across central Illinois, he said.
BMI could break ground soon, said Seth. “We could break ground as soon as August” on the plant if Gov. Pat Quinn signed legislation supporting loan guarantees from the state, said Seth, adding he anticipates a ground-breaking by this fall at the latest. Seth estimated the plant, which is expected to employ 25 people to start, would take 12 to 15 months to build.
The added benefit to pennycress is that it could be grown on the same ground farmers use for soybeans, said Brad Glenn, a board member of the Ag Guild of Illinois, a group representing 50 central Illinois farmers with 130,000 tillable acres that has entered into an agreement with BMI.
Pennycress is planted in the fall and harvested in the spring using traditional farm equipment, he said. “Farmers can harvest pennycress in late May and then plant soybeans behind it. It allows farmers to insert another crop into the growing season,” said Glenn.
Manning the combine that completed the final harvest of the pennycress crop Friday was Terry Isbell, research head of the National Center for Agricultural Research’s new crops division. Peter Johnsen, BMI’s chief technology officer and former director of the Peoria ag lab, credited Isbell with initiating research on pennycress as an energy crop.
Johnsen said widespread planting of pennycress “could bring as much as $100 million in new economic opportunities for our region.” Supporting those opportunities were area legislators, Sen. David Koehler, D-Peoria, and Rep. David Leitch, R-Peoria.
“This is the future - right here in Illinois,” said Koehler.
“Pennycress is part of the answer as we try to wean ourselves from oil,” said Leitch.
Steve Tarter can be reached at 686-3260 or starter@pjstar.com.
As Peoria ag lab researcher Terry Isbell surveyed the field filled with two-foot weeds, he had the look of a man who struck oil.
“This is what we’ve been looking for,” said Isbell, research head of the National Center for Agricultural Research’s new crops division.
The field in question covers 17 acres near the Caterpillar Inc. foundry in Mapleton, while the weed is pennycress, an oil-rich member of the mustard family that’s under consideration as one of the energy crops of the future.
What makes pennycress special is its oil content. The plant contains about twice as much vegetable oil as the soybean. Yet there’s another reason why pennycress offers promise, said Isbell, who planted the crop in September.
Unlike corn and soybeans, pennycress is planted in the fall and goes dormant during winter months only to continue its growth in the spring.
“We’ve got about a month to go before harvest. This crop has wintered well,” said Isbell, adding other oil-rich alternative crops like camolina and canola, also being grown in area test fields, didn’t fare as well over a central Illinois winter.
What excites Isbell and other researchers is that pennycress could give central Illinois farmers the opportunity to double-crop - to harvest two different crops on the same land in the same year.
Pennycress will be the topic of discussion at a meeting this summer involving Peoria’s U.S. Department of Agriculture lab and USDA labs in Iowa and Minnesota as well as representatives from Western Illinois University and North Dakota State University, said Isbell.
Research on the plant is accelerating in order to assess the possibilities of pennycress as a cash crop, he said.
“This is from wild seed. Imagine if it was bred,” said Isbell, pointing out the dense growth of plants in the Mapleton field.
Calls about pennycress come from around the globe, he said.
“We’ve had inquiries from New Zealand, Canada and New York,” said Isbell, who anticipates gathering plenty of seed from the Mapleton field - anywhere from 17,000 pounds to 40,000 pounds.
That’s good news for Peter Johnsen, chief technology officer for Biofuels Manufacturers of Illinois, a firm that looks to build a biodiesel plant in Peoria County within the next two years with hopes of using pennycress as a source for vegetable oil to blend with diesel.
“BMI will start as a conventional plant using soy and vegetable oils. We’ll start substituting pennycress into the stream slowly,” he said.
“This year we grew pennycress on 70 acres at 12 sites in central Illinois. In the fall of 2009, we look to grow pennycress on several thousand acres,” said Johnsen, encouraging area producers interested in growing the crop to contact BMI through the firm’s Web site, www.bmibiodiesel.com.
National Biodiesel Board Pledges Help to Pennycress Efforts in Peoria
Washington, D.C. – During a hearing held yesterday by the Committee on Small Business, the National Biodiesel Board pledged to help the Biofuels Manufacturers of Illinois (BMI) create a pennycress fueled biodiesel plant in Mapleton. While being questioned by Congressman Aaron Schock (R-IL), Mr. Manning Feraci, Vice President of Federal Affairs for National Biodiesel Board, committed to helping make the pennycress project a success.
“The National Biodiesel Board thinks pennycress holds great potential, and we applaud Congressman Schock’s efforts to promote this promising crop as a biodiesel feedstock,” said Feraci. “Advances like these will help the industry further diversify the feedstock from which we produce fuel and meet our nation’s energy needs. We look forward to working constructively with Congressman Schock and appropriate federal agencies to make this exciting project a success.”
“The National Biodiesel Board plays an important role in creating and sustaining biodiesel industry growth,” explained Schock. “Their support will be critical as we work to ensure BMI’s pennycress plant becomes an economic and jobs leader in central Illinois.”
WMBD/wYZZ TV - PEORIA — Republican Congressman Aaron Schock gets a first-hand look at a crop that could change the future of fuel.
Schock spoke with members of the Biodiesel Manufacturers of Illinois about the benefits of pennycress as an alternative fuel source. Pennycress is a weed that is planted in the winter and harvested in spring. Some experts say this weed can make twice as much oil for biodiesel as soybeans.
During his tour of the National Center for Agricultural Utilization Research Plan in Peoria, Congressman Schock said he’s been working with lawmakers in Washington to make pennycress an insured crop.
Schock says, “By us showing there is a buyer for the product, that helped ease and eliminate some of their concerns for why we need this insurance program. They have pledged their willingness to work with us to include pennycress in a new temporary insurance program for new crops.”
He said there’s already a group of entrepreneurs ready to build a facility that can use pennycress, to ensure farmers that if they grow it, someone will buy it.
Researchers at the Ag lab in Peoria say they are excited about benefits and costs savings from the Pennycress plant grown in Central Illinois during the winter.
They say it could be a model for other new crops containing energy alternatives.
U–S Ag Lab researchers say crude oil which comes from the Pennycress plant can be converted into biodiesel without being refined….and it’s better than some biodiesels currently on the market.
“If you know anybody that’s driven a diesel truck this winter in Central Illinois you’ve heard them griping about fuel filters plugging and that’s because the cloud point of the diesel is so high and this actually has a lower cloud point which means it will have a longer extended range that we can run this biodiesel in a diesel engine without plugging these filters,” said U.S.D.A. Researcher Terry Isbell
Ag lab officials say Peoria is unique because it’s among the first communities to use Pennycress as a bio–diesel fuel. Peoria area Congressman Aaron Schock toured the facility Tuesday and got an update on the program.
Biofuels Manufacters of Illinois is ready to build its plant here. But Schock says B–M–I is trying to clear a hurdle with the state.
The ag lab would mass produce the Pennycress seeds for B–M–I which will use its plant to convert renewable fats and oil to make biodiesel fuel.
Schock says the investors want to break ground right after getting a loan guarantee from the state.
“If the state will simple offer a guarantee these folks have the financing lined up with 4 or 5 local banks here in Peoria that are actually gonna provide the cash in and they can begin construction, real jobs, real stimulus in 30 days,” Schock said.
Schock says he plans to contact Governor Pat Quinn to try and facilitate a state loan.
He says U–S–D–A officials have pledged to include Pennycress in a new temporary insurance program for farmers who will participate in the program.
Researchers at the Ag lab in Peoria say they are excited about benefits and costs savings from the Pennycress plant grown in Central Illinois during the winter.