Biofuels Industry Takes A Searching Look At Using Pipelines

CC Technologies panel: There is significant interest in resolving the technical issues associated with transportation of FGE in pipelines because pipelines are a much safer and efficient means of transporting ethanol than the currently used methods. PRCI, AOPL, API, PHMSA, and operators are funding applied research in this area. Individual pipeline companies are looking at ways to safely transport FGE by means such as chemical inhibitor additions, batching processes, or blending with gasoline. There is less urgency with respect to other biofuels because of the reduced volumes.

Urbanchuk: Current profitability pressures on ethanol production caused by high feedstock prices has diverted the attention of many producers. However, the recent EPA decision to deny the renewable fuels standard waiver requested by Texas Gov. Rick Perry sent a firm signal that the U.S. is serious about developing biofuels as an alternative motor fuel. The ability to move twice as much ethanol in a decade and nearly five times as much by 2022 requires urgent attention. I believe the major players in ethanol production are aware of this potential obstacle to market penetration.

P&GJ: What is the significance of biofuels (ethanol) transportation needs on the U.S. pipeline industry?

Kane: The amount mandated by federal regulations in the near future (2012) is huge vs. historical volumes. There is a need to understand the link between our historical base (tanks, rail tanker cars, tank truck shipments) and requirements and guidelines for pipeline transport. The other issues that I hear include: Where is it all going to come from and, how will it affect other consumer products? From my standpoint, consumer pressure will likely result in our present dependence on corn-based ethanol in the U.S. being changed to include non-corn and non-food sources for bio-ethanol. This brings up another question: Will the different chemical fingerprints of ethanol produced from other bio-sources (sugar cane, sugar beets, paper plant and brewery waste streams to mention only a few) influence SCC susceptibility? We have already seen some data from lab tests that suggest that this may be the case.

CC Technologies panel: Biofuels transportation is a huge financial opportunity and risk for the pipeline industry. Pipelines are the obvious method of choice for biofuel transportation but, if the technical issues cannot be resolved, then the other means of transportation will fill the gap and expand in the near future. On the other hand, new facilities for transporting FGE could become obsolete or “orphaned” in a relatively short period of time, as previously discussed.

Urbanchuk: These needs will focus and direct investment and financing requirements. The development of ethanol from cellulosic and other non-cornstarch feedstocks will require careful technical evaluation.