Mascoma to Raise More Money in IPO?

by Bruce Goodman, Energy Lawyer

Mascoma Corporation, yet to break ground on its Kinross, Michigan non-food cellulosic ethanol facility, plans to raise up to $100 Million in an initial public offering (IPO) of stock.  The company has developed technology and genetically modified yeast with the potential to cut the cost of breaking down cellulose and fermenting the sugar.  It is already producing ethanol from wood on a demonstration scale at its facility in Rome, NY, and its affiliate Frontier Renewable Resources is developing the commercial operation at Kinross.  The air permit for the facility was issued in July.  Investors in the parent company include General Catalyst Partners, Kleiner Perkilns Caufield & Byers, VantagePoint Venture Partners, Atlas Venture, Valero, General Motors, Pinnacle Ventures, Flagship Ventures, Khosla Ventures, U.S. Department of Energy, State of New York, and the State of Michigan.

VA Facility Signs Contract for Biomass Gasification

by Bruce Goodman, Energy Lawyer    

The U.S. Department of Veterans Affairs Medical Center in Battle Creek has signed a contract with Nexterra Systems Corp. of Vancouver, British Columbia, to design and construct a biomass gasification system to provide heat and power. The 28 MMBtu/hour project will supply 14,000 pounds of steam per hour and 2 MW of electricity, with greenhouse gas emissions being reduced by 80 percent. The electrical production will furnish about 85 percent of the medical center’s demand. The combined heat and power unit will use locally-sourced residual biomass.

MSU Awarded $7.2 Million for Biofuel Research

by Bruce Goodman, Energy Lawyer 

The U.S. Department of Agriculture has awarded grants totaling $2.9 million for three biofuel projects at Michigan State University. The research projects involve: categorizing the greenhouse gas emission benefits of woody biomass energy, studying the pests that affect grasses used for bioenergy, and identifying the ways to use biofuel production byproducts. The U.S. Department of Energy has separately awarded $4.3 million to the Michigan Biotechnology Institute (MBI) to support similar work involving the conversion of non-food renewable resources into energy. All the funded research will involve MBI, the Lansing-based non-profit entity that is part of the MSU Foundation aiming to help prepare bio-based technologies and innovations for commercial use.

Ford Energy Lecture Series Focuses on Policy – September 20

 by Bruce Goodman, Energy Lawyer

In 1977, President Ford stated “I am pleased that we have made a good start towards a comprehensive national energy policy.” Triggered by the aftermath of the 1973 oil embargo, gasoline lines and price spikes, energy security and energy independence became major themes of the Ford Administration. Legislation was introduced and passed that resulted in national plans for energy research, development, and demonstration of technologies which included fusion, solar, wind, geothermal, ocean thermal and photovoltaic energy. The Solar Energy Research Institute was established, which later became the National Renewable Energy Laboratory. And where is the nation thirty-four years later? The new President Gerald R. Ford Energy Lecture series will explore this question. The goal of the series, sponsored by Varnum, will be to provide various historical and current perspectives on U.S. alternative energy policies. The first free lecture will be September 20 at 7:30 pm at the Ford Museum in Grand Rapids and will feature Frank G. Zarb, appointed “Energy Czar” by President Ford in 1974. Come join the discussion.  www.tiny.cc/FordEnergyLecture-Varnum

Short Distance Energy – Michigan’s comeback prescription?

by Bruce Goodman, Energy Lawyer

Energy security and the revitalization of Michigan’s economy are objectives that clearly intersect. Producing more Michigan energy with more in-state resources achieves both goals. This confluence of objectives will spur the “economic gardening” that will ultimately lead to more exports of Michigan goods and services to other states and the world. Distributed solar, biomass, hydro, and wind generation projects use local resources to generate energy where it is needed. Energy produced close to its end use with resources at hand—what could be more secure than that? Reduced line losses will make up some of the additional costs for this energy security. It is encouraging that the MPSC’s recent interpretation of the 2008 energy statute rejected a lowest cost energy strategy in favor of increased generation diversity. This means Michigan utilities can pay a little more for their electricity if it means more secure distributed energy from more in-state fuels (wind, solar, biomass). This could send a strong message to the energy sector of Michigan’s manufacturing and innovation communities. Unfortunately, although energy security and innovation receive a great deal of political lip service, translating it into policy and sustained action seems to be a step some are not ready to take.

Does/Will/Can Michigan have an Energy Policy?

by Bruce Goodman 

What does it take for a state (that is not California) to have an energy policy?  The question is timely because elections are approaching and one would hope the candidates would address all the important issues.  But will anyone take a public stand on unresolved energy issues: increasing the renewable portfolio standard percentage; new coal-fired generation; feed-in tariffs; standby rates; recommendations of the Great Lakes Wind Council or the Climate Action Council?  I suspect not.  Thus come January we are likely to continue with state energy policy “on the fly”, with a dash of gridlock and pinch of skepticism.  Let the Feds make the hard decisions on GHG regulation and renewable energy standards.  Term limits have done their job—left Michigan with a legislature with little institutional memory and little legislative expertise to address complicated issues such as energy.  Hey, how about energy platforms and energy debates in all the state races so that we can get these issues on the table.  Watt would be wrong with that?

New Coal Plant for Holland at Risk

by Bruce Goodman

The MPSC staff has made a determination that the 70 MW (net) coal-fired electric generating plant being proposed by the Holland Board of Public Works is not needed. The report found that the municipal utility has not explored sufficient alternatives to show that a new coal plant was the best way to meet its current and future load. It also found that the demand growth projections were overly optimistic. The report suggested that Holland consider making purchased power a larger portion of its supply portfolio. Now the Michigan Department of Natural Resources and Environment will weigh the report in deciding whether to grant an air permit to the project.

Energy Supply Policy Does Not Have Free Lunch

by Bruce Goodman

Comprehensive energy supply policy needs to simultaneously address concerns about climate, energy security, and economic viability.  Anyone who advocates a program on a single issue needs to be viewed skeptically.  The wind does not blow nor the sun shine all the time.  There is no single answer – technical nor policywise – to all the problems and issues.  There needs to be a consensus that the free market does not appear to be ready to provide answers.  The government needs to kick start the problem-solving process with clear goals and simple programs.  Everyone needs to accept that the perfect energy supply policy will not spring automatically out of this process.  Energy prices will inevitably increase – there is no free lunch.  Even a long journey begins with but a single step.  That step must now be taken, both at the state and federal levels.

Searching for Any Port in an Economic Storm

by Bruce Goodman

As Michigan charts its economic future it needs to make certain it identifies and leverages its natural assets.  In the past it has used its timber resources to foster the furniture industry, the special character of its sands to foster the sand casting foundry industry, and its abundant water to foster water intensive manufacturing.  Now it is time to use its central location and access to the Great Lakes, the Mississippi, and the Atlantic to foster manufacturing of the next generation of large wind energy equipment.  Windturbine components and finished wind energy goods are bulky, and shipping them is expensive.  Rail and over-the-road transportation are increasingly a limiting factor in how big these can be. So transportation in and out of our state by ship and barge would provide an economic and logistical solution.  The port cities of Michigan need to consider how to take advantage of this confluence of shipping advantages and the state’s manufacturing talent to kick start the location of wind turbine industry(s) right here.  As the only state with access to four of the five Great Lakes, we need to make lemonade out of lemons.  Our peninsular geography can turn intermodal transportation (rail, truck, barge) into an asset.  The logic and logistics seem obvious.  Bring in the big cranes!

Opportunities for Biomass – Power and Heat (1 of 3)

by Bruce Goodman

Biomass power technologies include direct firing, cofiring, gasification, anaerobic digestion and other technologies. Although many current biomass power plants are small, industrial cogeneration or heating applications, utility-scale plants with capacities in excess of 80 megawatts have been commissioned. In the United States, biomass power plants currently represent 11,000 megawatts of capacity, the second largest amount of renewable energy in the nation.  Michigan has a number of wood fired electric generating facilties, some operating for more than 20 years.  In addition it has two major waste to energy projects fired with municipal solid waste. 

Interest in biomass power is on the rise. Although the primary driver to consider biomass power has been its potential to lower heating and power production costs, the anticipation of global carbon markets and renewable power mandates is spurring a new wave of investment in this sector. Perhaps most critical to this new interest is that these facilities can generate electricity at any time (24/7), unlike some of the current most popular renewable sources of energy.

In addition biofuels plants are becoming true biorefineries, incorporating the production of fuels, chemicals and power at a single location.