ASTM Spec for Higher Bio Blends Moves Heat Towards Lower Carbon Future

Posted by Ed Burke on May 26, 2015 1:48:24 PM

Chalkboard image with Biofule in focus

ASTM International released its new spec for 6-20% bio blended heating oil (BioHeat) this past March. The prior spec only covered blends of up to 5% - like those you can pull from many racks now. 

This change comes as the rolling sulfur reductions in many New England and Northeast states is beginning. Most of these states are dropping sulfur to 15ppm by 2018, with some already at that level for heating oil (ie New York).

These changes in tandem are a huge push forward for the industry on both reducing emissions, and moving to a more environmentally friendly, domestically produced, bio blended product.

The hope is having an official ASTM spec for higher blends of Bio will encourage use of those blends to grow, because it will eliminate the uncertainty of product quality for consumers, dealers, and marketers. Additionally, the spec will allow manufacturers and OEMs to determine what blend their equipment can support, and they will be able to make adjustments to adapt to higher blends in an educated and informed manner.

There is less concern environmentally with moving to higher bio blends than we see with ethanol blends, because biodiesel can be produced from recycled grease, animal fats - essentially waste stock versus being 100% derived from virgin food crops (ie soybeans), whereas that is not the case for ethanol, which has been haunted by food vs fuel impacts. 

I wrote an article for the May issue of Oil & Energy Magazine on the topic of the new Bio spec and the move to cleaner heating oil, which you can read in full by clicking here:  "Transforming Heating Oil for a Low-Carbon Future"

 

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Topics: Oil & Energy Magazine, Bioheat, Biodiesel, astm

RFS Battles Continue on Ethanol and E15

Posted by Ed Burke on Apr 21, 2015 3:59:45 PM

Container of corn kernels with a Biofuel sticker affixed

This week, Ethanol activists in Chicago used the 20th anniversary of the BP Oil Spill in the Gulf to push for approval of a pending mandate that would require self-serve stations with over 850,000 gallons in annual sales volumes to carry E15, given they had the proper infrastructure for the blend. They argued that companies will "keep on spilling" and that made it imperative that the push continue towards higher blended, "cleaner" ethanol.

On the flip side, on April 21st, major petroleum groups API and AFPM requested the EPA ban the sale of E15 as a flex fuel. E10 Ethanol has a 1 psi volatility waiver that allows it to be RVP compliant in summer months. E15 is not compliant, however. The argument then is that stations, etc, are using E15 as a flex fuel in the summer months to avoid having to comply with RVP regulations.

The EPA is expected to formally announce the RFS volume requirements any day now, but even prior to the announcement there is action on the RFS in the legislature. House Bill HR 701 would cap ethanol at 10% blends, and rescind the EPA's approval of E15 blends. 

Another part of the bill states that target numbers for cellulosic ethanol goals need to be production based, which obviously makes sense, since one of the major issues with the RFS has been the cellulosic mandate in the face of a complete lack of cellulosic production.

I wrote an article for this months Oil & Energy Magazine detailing the growing dissension between RFS involved groups, impacted industries, the EPA and the Government - you can read that article here:

"Dissension Grows over Biofuels Rules"

 

 

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Topics: Ethanol, EPA Mandate, Cellulosic Ethanol, RFS

Infrastructure on the Agenda

Posted by Ed Burke on Mar 31, 2015 12:16:19 PM

Abstract view of the cockpit of a semi-truck driving on the highway

Energy Infrastructure is one of the topics essentially absent from the Congressional agenda at the moment, with the exception of continuing efforts to pass a Keystone XL bill. As you recall, the last bill successfully passed the House and Senate, only to be vetoed by President. It ultimately died in the Senate where it lacked the votes to override said veto. 

What's interesting is the legislature is dealing with a lot of infrastructure and transportation structure and funding issues (the Highway Trust Fund, Supply Chain issues on the West Coast, EPA Clean Power Limit Proposals, etc) but has somewhat neglected looking at energy infrastructure as a stand alone concern.

One of the EPA proposals under review, the "Clean Power Plan" which seeks to limit carbon emissions from existing power plants. The proposal would spike electricity rates further, and rate payers would also be on the hook for the upgrades needed to comply with the proposal if it goes through in its current form. 

This is especially bad for New Englanders who have recently been dealt a 37% rate hike on electric utility rates (read more on that here: MA Rate Hikes). New Englands issue is a lack of infrastructure on the natural gas side, somewhat ironically. 

I wrote an article for the March issue of Oil & Energy Magazine on Infrastructure policies under review and how a lack of forward progress on them could slow economic growth. You can read the full article here: Infrastructure Shortfalls Could Slow Growth 

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Topics: Oil & Energy Magazine, Energy Infrastructure, Congress

Harvard finds Boston is Leaking $90 Million of Natural Gas Annually

Posted by Ed Burke on Jan 29, 2015 12:44:52 PM

Yellow caution tape reading, caution gas line buried below

A Harvard University study has concluded that 15 billion cubic feet of natural gas escapes the aging pipelines in Boston - an amount that means we're losing $90 MILLION dollars worth of natural gas through leakage annually. 

The problem with leakage, outside of the obvious environmental and health concerns, as well as the fact that consumers bear the cost of the leakage, is that this leakage is responsible for almost all of the methane emissions given off by the city. As we've discussed previously, methane has a 25 times larger impact on the environment than carbon, and for that reason it's been the focus of new proposed regulations from the Administration and the EPA.

The suggested regulations however, are aimed at fracking companies, which over the past year have shown large declines in the amount of methane leaks, and leaks in general in four out of six of the major shale plays. The reason for that is at the production site, leakage costs the producer money in lost product.

The second sector that the regulations aim at (although they are "voluntary" in this case) is agriculture, which is responsible for the bulk of methane emissions. 

When you break down the numbers however, most emissions come from so called "super users", namely power plants etc., versus fracking sites or even intense agricultural production sites. And as studies like this point out, there is a lot of environmental impact happening passively through leaking in outdated pipeline systems, like those in Boston.

What this study points out on leakage, is that there may be a more efficient way to curb urban emissions of gas, and therefore methane, than imposing sweeping regulations on fracking sites, who already are self-motivated by profit to control product loss. That motivation is less present in urban areas, because the cost of pipe replacement and remediation is high, and the work is complicated to perform without disruptions in densely populated areas. Additionally, remediation of leaks in urban pipelines is a direct cost to the utility as well as the consumer, versus the cost-savings measure it is for upstream producers.

To their credit, both Massachusetts and National Grid have already been working on an accelerated pipeline replacement project. This program categorizes how risky leaks are and addresses them in an urgent to non-urgent priority order. This allows them to address the most critical leaks first, and move forward on remediation without undue and immediate cost burdens on the utility or the consumer.

 Essentially, studies like this point out there are emission control options downstream in addition to the ones happening upstream that can complete the picture and move the entire process forward in a more timely and efficient manner.

If you want to read a little more on the background of methane regulations proposed, or the prior study on leaks in Boston, you can do so here: "Methane and Consumers giving Nat Gas Headaches"

If you want more background on fracking and environmental impact, you can do so here: "US Carbon Emissions Still on the Decline - Guess Why?" 

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Topics: natural gas, EPA Mandate, Fracking, methane

Looking Back and Looking Forward - Energy in 2014 & 2015

Posted by Ed Burke on Jan 22, 2015 8:38:55 AM

Abstract image of an oil rig, calculator and cash

The most recent article I wrote for Fuel Marketers News is now online.

We looked at the domestic and geopolitical factors that shaped the 2014 slide, and looked at what we might expect in 2015. 

You can read the article in Fuel Marketers News here: This Time Is Different - Current Drop Has Long Term Support

Let me know what youu think in the comments section!

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Topics: Market analysis, fuel marketers news

How Will the EPA Address the RFS for 2014 & 2015?

Posted by Ed Burke on Jan 21, 2015 10:43:17 AM

Chalkboard image with the focus on Biofuel

In November the EPA announed it would not be able to finalize on the RFS volumes for biofuels until 2015. The 2014 and 2015 volumes will be set soon,, in theory. But there has been a lot of stress out there in the industry over the fact that the delay will essentially mean refiners and producers need to be retroactively compliant with the volumes the EPA sets.

The biofuels industry is pushing for an increase in biofuel requirements, to 18.15 billion gallons. This is probably not happening, but the uncertainty overall has had a serious impact on bio producers, many of whom have scaled operations way back over 2014 as compared to 2013.

On the other hand most refiners argue that the EPA should lower the standard by 16% given the drop in demand year on year since the RFS' inception in 2007. Additionally the cellulosic ethanol standard should be scrapped, its argued, since its not available for use and its therefore impossible to comply with that portion of the mandate.  

The implication the EPA gave was that it was looking at reducing volumes, and would almost certainly not be increasing the ethanol mandate over the 10% current level - ie that it wouldnt break the so called "blend wall". We will have to see how it plays out over the next month or so. 

I wrote a more in depth piece on the RFS for January's Oil & Energy Magazine, if you want to dive into the topic a little deeper, you can read that article here: "Rethinking the Renewable Fuel Standard"

 

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Topics: Biodiesel, RFS 2, EPA Mandate, EPA

AltWheels - Past, Present and Future

Posted by Ed Burke on Jan 7, 2015 12:32:35 PM

The most recent AltWheels Fleet Day in Norwood was once again a great success. We've been part of AltWheels from the beginning, back when biodiesel was a niche product and who had ever even heard of ethanol gasoline?

There have been a lot of advances and changes in the landscape of alternative fuels and vehicles. I wrote an article for Oil & Energy Magazine in December chronicling some of the major evolutions we've seen across the field of alternative energy. You can read that article here: "Fleets of the Present and Future: Ed Burke Reports on Alt Wheels Fleet Day"

And below, just for fun here's some awesome shots of the great times we've had at AltWheels past. Enjoy!

AltWheels recognizes green pioneers

E85 pickup truck

Two men standing in front of a flex fuel Chevy AvalancheMan in a suit standing at a podium giving a speech

Chevy VoltHonda Civic - Natural Gas

Police officers riding on horses pose infront of the Dennis K. Burke kiosk

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Topics: natural gas, Biodiesel, Ethanol, environment, altwheels,, electric vehicles

Keystone XL Hits the Senate Floor

Posted by Ed Burke on Nov 18, 2014 11:59:17 AM

Oil pipeline in the snow

Today, the bill to approve the construction of the the Keystone XL pipeline hits the Senate, after the House approved Cassidy's legislation by 252-161 on Friday. 

In an exciting twist, the Senate is apparently stuck at 59 votes in favor, one shy of the 60 needed to pass the legislation and send it to the Presidents desk. However, Mary Landrieu (D-LA) claimed yesterday to have secured the 60th vote. The bill hits the floor in what some say is an attempt to boost Landrieu's chances of maintaining her Senate seat in the December 6th runoff election she faces versus, oddly, the bill's sponsor, Bill Cassidy.

(Sounds cynical, yes, but given that the House has previously passed 8 seperate bills to push the vote on Keystone and none saw the Senate floor, it seems pretty reasonable as well.)

The jury is out on whether if the bill passes it will be vetoed by the President or not. He cited a legal challenge to the pipeline in Nebraska that is still ongoing, stating that "process should not be interfered with", but Secretary of State John Kerry recently made statements in Canada that implied the Administration may not veto a bill if it came down to it. It's really anyone's guess. 

Obviously, this has been a lighting rod political issue for the over 6 years the project has been on hold. On one side there are environmental groups and people in the geography impacted, who are concerned with  the climate impact, potential leaks,  and the "doubling down" on a commitment to fossil fuels they see the pipeline as representing. On the other are groups who argue this strengthens our energy independence and supports American workers and the American economy versus that of other countries, and those who cite the immediate jobs boost the project will represent. 

We've talked about some of these Keystone related issues before: 

There are 6 hours scheduled for debate on the floor, with the vote expected to occur at 6:15pm. Stay tuned! 

 

 

 

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Topics: Energy Independence, Keystone XL, Energy Infrastructure, TransCanada, senate

Midterms 2014: What Will the Energy Agenda Look Like Now?

Posted by Ed Burke on Nov 6, 2014 8:00:00 AM

United States House of Representatives

How will the 2014 Midterm Election results cause a shift in the Energy Agenda?

Keystone XL:

Prior to the midterm elections, Congress sent numerous bills to the Senate to push approval of the Keystone XL pipeline, none of which were brought to the Senate floor. That all likely changes with a Republican Majority Leader. Most likely we will see a vote happen on Keystone, and with Republicans controlling the Senate there are solidly enough votes to pass. Whether the President will sign it or not is up for debate, but in late October during a visit to Canada, Secretary of State John Kerry said he would like to "see a decision, sooner rather than later", maybe signaling that the President won't veto the bill once it hits his desk. 

Crude Exports

Less of a change expected here with the party shift. Exports were expected to be a big consideration in 2015 regardless of party control. Republican Lisa Murkowski and Democrat Mary Landreiu were both expected to move the issue forward. As of this morning Landreiu is locked in a runoff contest, but Murkowski will be stepping up as Chair of Senate Energy and Natural Resources Comittee next year, and has vowed to push the issue on LNG and Crude exports. 

Other Issues

Other issues that may come to the fore include addressing the EPA's proposed regulations on pollution generated from coal fired plants. This is probably too late to be relevant in the New England region, where we are seeing skyrocketing electricity costs and Natural Gas supply issues as a result of retiring older plants. 

It will be interesting to see if other items come to the floor as the legislative session advances. Perhaps RFS issues, blendwall issues, or indications of a reversal of the prohibition of fracking on Federal Land. We shall see.

 

 

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Topics: US Crude Exports, EPA, Keystone XL, carbon emissions, Election Results

Breaking: WH threatens Sanctions on ISIS Oil Purchasers

Posted by Ed Burke on Oct 24, 2014 8:33:30 AM

United States Department of Treasury seal

Treasury Under Secretary David Cohen announced Thursday that US airstrikes are having the desired impact of weakening the revenue generating abilities of ISIS/ISIL. Estimates are that ISIS generates up to a million dollars a day through a complicated black market oil sale operation. This financial self-sufficiency is one of the factors in how the group became so strong, and so difficult to starve from funding. According to the Undersecretary, the lack of reliance on normal financial transactions prevents the Treasury from hammering ISIS funding the way it's often possible to do on other groups who rely on banks and other financial institutions to transfer their money. 

Phase two on revenue attack, it appears, will be sanctions on the purchasers of the black market oil. Reportedly the Assad regime in Syria and Turkey are often the players involved. Today the White House has announced they will impose sactions on those purchasing this blackmartket oil in addition to continuing airstrikes near refineries to cut off primary supply. 

US sanctions would prevent the country or entity in question from using US financial instiutions of any kind. The idea generally is that other countries follow suit - ie British banks would not likely continue or accept business from the entity, etc. 

So far, airstrikes by the US and Arab allies have dropped crude production for ISIS to roughly 35% of its prior output, or around 20,000 barrels per day. Continually decreasing global prices means that black market prices have to be dropping as well to maintain the discount - and when you couple that with such a steep drop in production, it seems rather clear that the airstrike campaign is putting a serious damper on fundraising ability.

Stay tuned! 

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Topics: Syria, Baiji Refinery, Iraq, ISIS, sanctions

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