U.S. Biofuels Index: dramatic growth brings planned capacity to 795,700 barrels per day
Growth in planned projects and those currently under construction in the United States remains strong for both ethanol and biodiesel plants, according to a Biofuels Index kept by Soyatech, which has been updated for the second quarter of 2007. However, the data also shows signs that the corn-based ethanol build out may be leveling off. Nonetheless, total planned capacity for liquid biofuels in the U.S. now stands at an amazing 795,700 barrels of oil equivalent per day (boe/d) - more than the oil output of OPEC member Qatar.
Ethanol
Soyatech's Biofuels Index, which tracks planned and actual build-out of biofuels production capacity, reports dramatic growth in planned capacity for ethanol plants over the past year, from 6.761 billion gallons per year (BGY) (25.5bn liters) as of July 1, 2006, to 13.03 BGY (50.3bn liter) as of July 1, 2007 - an increase of 93%. During this same period, growth in ethanol capacity under construction increased 199%, from 2.417 BGY (9.3bn liter) to 7.226 BGY (27.3bn liter) (map, click to enlarge).
Total planned ethanol capacity for the U.S., taking into account the lower energy content of ethanol, now equates to around 606,700 boe/d.
During Q2 2007, total online capacity for ethanol increased by 564 million gallons per year (MGY), or 10.7%, from 5.289 BGY (20bn liters) to 5.853 BGY (22.2bn liters). Capacity in planning rose by approximately 6% during the quarter.
However, the Index also points to a slight leveling off in construction of ethanol plants during Q2 2007 - the first time since the Index began tracking these numbers. According to the Index, capacity under construction decreased slightly by 1.7%.
Biodiesel
Total online capacity for biodiesel production increased sharply - 41% from Q1 to Q2 2007, from 890 MGY (3.4bn liters) to 1.255 BGY (4.7bn liters). While it is easier to produce impressive growth when starting from a smaller base, a 41% growth rate nevertheless means that industry capacity for biodiesel nearly doubled over the last three months. That is certainly a significant development, says Jacob Golbitz, director of research for Soyatech and its parent company, HighQuest Partners.
Biodiesel capacity under construction for the same period grew by 19%, from 1.613 BGY (6.1bn liters) to 1.927 BGY (7.3bn liters), and planned capacity rose even further by 24%, from 2.331 BGY (8.8bn liters) to 2.898 BGY (11bn liters).
Total planned capacity for biodiesel in the U.S. now equates to roughly 189,000 boe/d.
The U.S. thus has an overall planned liquid biofuel capacity of 795,700 barrels of oil equivalent per day - an impressive number, making planned biofuel capacity in the U.S. larger than the total petroleum output of OPEC member Qatar: energy :: sustainability :: ethanol :: corn :: biodiesel :: bioenergy :: biofuels :: United States ::
Golbitz noted that one factor contributing to the strong showing for biodiesel is optimism that the $1 per gallon federal subsidy for biodiesel will be extended with the passage of the 2007 Farm Bill later this year.
The Index summary also discusses issues surrounding feedstock availability, noting a movement away from reliance only on soybean oil and towards the use of alternative feedstocks in the capacity build-out of biodiesel plants.
According to the Index, only 39% of capacity currently under construction, and just 16% of planned capacity, indicates soybean oil as the sole feedstock. "Given the development of trends that we have observed over the last six months, we expect convergence in the price of all commodity fats and oils over the next 6 to 12 months that will leave little to no additional margin for biodiesel producers that use alternative sources," Golbitz noted.
Commenting on the slight decrease in new ethanol plants being build, Golbitz said that "while the percent change is too small and the time frame too short to identify this as a definitive trend, we understand from industry sources that it is more difficult to secure debt financing for new refineries due largely to increased equity requirements on the part of banks providing this funding. We suspect that an additional cause may be constraints on the amount of corn available as a feedstock to produce ethanol."
Map: distribution of existing and planned ethanol plants in the United States, as of June 2007. Credit: DTN Ethanol Center.
References:
SoyaTech: Growth Strong in Biofuels Projects, Corn-Based Ethanol May Be Leveling Off: New Results from Soyatech's Quarterly Biofuels Index - August 22, 2007.
Ethanol
Soyatech's Biofuels Index, which tracks planned and actual build-out of biofuels production capacity, reports dramatic growth in planned capacity for ethanol plants over the past year, from 6.761 billion gallons per year (BGY) (25.5bn liters) as of July 1, 2006, to 13.03 BGY (50.3bn liter) as of July 1, 2007 - an increase of 93%. During this same period, growth in ethanol capacity under construction increased 199%, from 2.417 BGY (9.3bn liter) to 7.226 BGY (27.3bn liter) (map, click to enlarge).
Total planned ethanol capacity for the U.S., taking into account the lower energy content of ethanol, now equates to around 606,700 boe/d.
During Q2 2007, total online capacity for ethanol increased by 564 million gallons per year (MGY), or 10.7%, from 5.289 BGY (20bn liters) to 5.853 BGY (22.2bn liters). Capacity in planning rose by approximately 6% during the quarter.
However, the Index also points to a slight leveling off in construction of ethanol plants during Q2 2007 - the first time since the Index began tracking these numbers. According to the Index, capacity under construction decreased slightly by 1.7%.
Biodiesel
Total online capacity for biodiesel production increased sharply - 41% from Q1 to Q2 2007, from 890 MGY (3.4bn liters) to 1.255 BGY (4.7bn liters). While it is easier to produce impressive growth when starting from a smaller base, a 41% growth rate nevertheless means that industry capacity for biodiesel nearly doubled over the last three months. That is certainly a significant development, says Jacob Golbitz, director of research for Soyatech and its parent company, HighQuest Partners.
Biodiesel capacity under construction for the same period grew by 19%, from 1.613 BGY (6.1bn liters) to 1.927 BGY (7.3bn liters), and planned capacity rose even further by 24%, from 2.331 BGY (8.8bn liters) to 2.898 BGY (11bn liters).
Total planned capacity for biodiesel in the U.S. now equates to roughly 189,000 boe/d.
The U.S. thus has an overall planned liquid biofuel capacity of 795,700 barrels of oil equivalent per day - an impressive number, making planned biofuel capacity in the U.S. larger than the total petroleum output of OPEC member Qatar: energy :: sustainability :: ethanol :: corn :: biodiesel :: bioenergy :: biofuels :: United States ::
Golbitz noted that one factor contributing to the strong showing for biodiesel is optimism that the $1 per gallon federal subsidy for biodiesel will be extended with the passage of the 2007 Farm Bill later this year.
The Index summary also discusses issues surrounding feedstock availability, noting a movement away from reliance only on soybean oil and towards the use of alternative feedstocks in the capacity build-out of biodiesel plants.
According to the Index, only 39% of capacity currently under construction, and just 16% of planned capacity, indicates soybean oil as the sole feedstock. "Given the development of trends that we have observed over the last six months, we expect convergence in the price of all commodity fats and oils over the next 6 to 12 months that will leave little to no additional margin for biodiesel producers that use alternative sources," Golbitz noted.
Commenting on the slight decrease in new ethanol plants being build, Golbitz said that "while the percent change is too small and the time frame too short to identify this as a definitive trend, we understand from industry sources that it is more difficult to secure debt financing for new refineries due largely to increased equity requirements on the part of banks providing this funding. We suspect that an additional cause may be constraints on the amount of corn available as a feedstock to produce ethanol."
Map: distribution of existing and planned ethanol plants in the United States, as of June 2007. Credit: DTN Ethanol Center.
References:
SoyaTech: Growth Strong in Biofuels Projects, Corn-Based Ethanol May Be Leveling Off: New Results from Soyatech's Quarterly Biofuels Index - August 22, 2007.
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