Biofuels in the Barnyard of Sunrise Cooperative
It was about 20 years ago that artists like Willie Nelson, Emmylou Harris, Neil Young, and others organized the first "Farm Aid" concerts to raise dough and highlight the plight of the struggling family farmer in the U.S. The Farm Aid organization is an outgrowth of that commitment. Its mission is to, "Keep family farmers on their land."
Nowadays, everybody from General Motors to George Bush is turning to the American farmers' amber waves of grain as a panacea for our imported petroleum ills. It's about time these farmers are getting a little respect. But, hey, what do I know? I grew up in the city where I rarely saw corn that wasn't in a can. Little did I realize I was downing something I could have been pouring into my dad's Buick Roadmaster. "Son, you'd best not turn up your nose at that creamed corn. There's flex-fuel vehicles in Indiana that would be glad to have that."
Read all about the Sunrise Cooperative after the jump.
Historical Roots – Humble Biofuel Beginnings
As the saying goes, desperate times require desperate measures and it seems that anything that grows is fair game for a fuel source these days. But this isn't the first time in U.S. history that our backs have been against the wall and I think the height of the Great Depression qualifies as "desperate times". So it makes sense then that it was around the time of the dark economic days of the republic (the 1920s to be exact) that three cooperatives in Northwestern Ohio were founded. Fed up with high fuel, feed, and fertilizer costs, and long before a Willie Nelson type came in to help raise capital, a few dozen farmers made the brave decision to take matters into their own hands and start their very own "company stores". These three coops would merge into Sunrise Cooperative, Inc in 1990.
When the coops started, they were concerned about fertilizer and fuel. Today, they look at getting fuel from the fertilizer since Sunrise Cooperative is jumping on the biofuels bandwagon in a big way with biodiesel from soybean crops and E85 from corn. Well, maybe "jumping" is not quite accurate. Slowly and deliberately mounting a skittish mare is more like it.
Tom Szlagyi Sr., is an energy specialist at Sunrise and has experienced first-hand the slow and inexorable shift to biofuels. He says the shift has been a roller coaster ride of rising and falling public interest, tax incentives that come and go, and pricing peaks and valleys over the years. Szlagyi has been with the company for 13 years and has seen the rolling landscape change. "At first it was an uphill battle to gain acceptance for biodiesel and other biofuels, now it's all the rage." he says.
Only the Best Biofuels Onboard
Sunrise has been furnishing biodiesel blends to its members and to the general public (at non-member pricing) since 2001 and knows about large biofuel capacity. The facility sports seven 15,000-gallon storage tanks and three 10,000-gallon tanks. They currently sell about 230,000 gallons of fuel (not all biofuels) per month in non-member sales from their retail station. Sunrise also deals in bulk fuel delivery to member-owners, commercial customers and other cooperatives, as well as privately owned petroleum marketers who sell to their customers and Sunrise's total comes to a whopping 6 million gallons of blended biodiesel fuel annually. All that thirsty equipment must suck down fuel like a frat house downs kegs. The cool part of the coop arrangement is the farmer-members' final cost is lower than the standard retail price paid by non-members. My first thought upon hearing this was "Where do I sign up?" The catch is you must be a farmer, not a home gardener, to be a coop member. Figure on a couple of hundred thousand dollars worth of equipment to till the "x" number of acres you have to own to join this "country club". Guess I'd fail the equipment section of the entrance exam.
Special above ground storage tanks have been constructed for B99.9 (99.9% biodiesel, 1/10 of 1% petroleum diesel). Pure biodiesel gels at temperatures higher than regular diesel, thus the need for keeping the liquid gold relatively warm. There is also a 10,000 gallon insulated tank in a heated storage building and a 30,000-gallon, double-walled, heated and insulated tank outside.
On May 12th, Sunrise celebrated another milestone. All regular diesel sold from the pumps at its retail station since that day is actually B5, a five percent blend of biodiesel and regular diesel. The B5 blend was selected because the cost is competitive with regular diesel fuel and manufacturers' warranties are honored (most diesel engine manufacturers are still evaluating B20 as far as warranty coverage is concerned).
Sunrise is picky about the quality of the biodiesel it buys. The biodiesel must meet the ASTM D-6751 standard plus the BQ9000 standard. BQ9000 is an emerging standard being pushed by the National Biodiesel Board. Simply put, it is a "paper trail" that enables any given batch of biodiesel to have its quality checking verified. Szlagyi showed me two samples of biodiesel during my visit. I was surprised to learn that color can vary widely in D-6751 biodiesel and that some biodiesel is actually distilled to be clear, not amber. The distilled variety can be sold by the biodiesel producer for uses other than fuel.
As mentioned above, Sunrise is planning to offer E85 soon. Even though there are no flex-fuel tractors plying Ohio farms, flexible fuel highway vehicles equipped for E85 are currently available to the general public and more are slated to hit the market. A flex-fuel vehicle can run on regular unleaded gasoline, on E85, or any mixture of the two. The engine adjusts for the proportion of ethanol in the vehicle's tank at any given time. While laudable for being a predominantly renewable and cleaner-burning fuel, E85 reduces fuel mileage by a significant margin. Flex-fuel vehicles burn 10% to as much as 30% more E85 than regular gasoline. This is due to the lower energy content of ethanol in comparison to gasoline. Thus, E85 at the same retail price as unleaded is at a cost disadvantage. Szlagyi observed that, "People are driven by the mighty dollar so E85 really has to be cheaper than unleaded to move in the marketplace." He explained that they are waiting for ethanol prices to come down so they can sell E85 at a competitive price. Shipping and storage costs make up a large portion of pricing imbalance. Tanks at the co-op's retail station are currently fitted with stainless steel components and are ready for E85.
Between the Farm and the Fuel Tank
Distributors like Sunrise will play an increasingly important role in a diversified fuel future. Biofuels like E85 and biodiesel represent a tremendous opportunity for the American farmer. It doesn't take a soothsayer to realize it's a positive development when a whole new market opens for your products. The convenience of having biofuel choices at the urban neighborhood pump depends upon facilities like Sunrise Cooperative acting as the go-between for farmers, fuel producers, fuel blenders and fuel-users. With an extensive history of service behind them and solid experience with farm-raised fuels, it looks like the folks at Sunrise will be key players in the alternative fuel game long into the future.
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