NEW YORK --(BUSINESS WIRE)-- GreenShift Corporation (OTC Bulletin Board: News) today announced that its patented corn oil extraction technologies were featured prominently in the final rule for the expanded Renewable Fuel Standard (RFS2) published by the U.S. Environmental Protection Agency (EPA) on February 3, 2010.
EPA, under the Energy Independence and Security Act of 2007 (EISA), is responsible for implementing regulations to ensure that transportation fuel sold in the United States contains a minimum of 36 billion gallons of renewable fuels per year by 2022.
In its Regulatory Impact Analysis and responses to comments that were submitted on the development of the RFS2, the EPA highlights the key role that it expects corn oil extraction will play in the evolution of the U.S. renewable fuels industry, stating its belief that 70% of the U.S. corn ethanol industry will use backend corn oil extraction technology to produce 40% of America's biodiesel feedstock by 2022.
Corn Oil Extraction Technology
GreenShift's patented corn oil extraction technologies enable GreenShift and its licensees to "drill" into the backend of first generation corn ethanol plants to tap into an existing reserve of inedible crude corn oil that has been historically trapped in the distillers grain co-product of ethanol production. This corn oil is a valuable second generation feedstock for use in the production of advanced carbon-neutral liquid fuels, such as biodiesel, biojet fuel, and renewable diesel, thereby enhancing total fuel production from corn, increasing ethanol plant profits, and reducing lifecycle greenhouse gas (GHG) emissions.
Key Highlights of EPA's Regulatory Impact Analysis
Reduced Carbon — According to the EPA's analysis, use of corn oil extraction is expected to reduce lifecycle GHG emissions of corn ethanol by about 18%, or by about 4.5 million tons per year of carbon industry-wide at the EPA's estimated 70% penetration rate, the highest reduction of any of the advanced technologies cited by the EPA.
Reduced Energy — Since corn oil is an insulator, removing it improves the heating efficiency and reduces the energy demand of corn ethanol. The EPA projected reductions in thermal energy use of 5.4% due to use of corn oil extraction technology. While GreenShift believes the energy savings are substantially greater, the EPA's estimate corresponds to industry-wide savings of about $160 million per year at current market prices at the 70% penetration rate projected by the EPA.
Increased Profitability — Use of corn oil extraction increases co-product revenues in addition to reducing production costs. The EPA estimated that ethanol producers using backend corn oil extraction technology can increase their profit by about $0.079 per gallon of ethanol produced.
Compliance with RFS2 — The EPA concluded that "based on our final rulemaking analysis we have found that corn ethanol, including advanced technologies such as corn oil extraction/fractionation, reduces GHG emissions by more than the 20% threshold required for renewable fuels."
Vital New Biofuel Feedstock — The EPA estimated corn oil will be "a significant contributor to the biodiesel volume required by the RFS2 rule," projecting that "low-grade corn oil extracted from dry mill ethanol production" will be used in 2022 to supply feedstock for 40% of the total annual U.S. output of biodiesel. This equates to 680,000,000 gallons or about 5.2 billion pounds per year of inedible corn oil feedstock with a current market price of about $0.25 per pound.
"The existing corn ethanol complex is the bedrock of America's renewable fuels industry; it presents a practical pathway to increase America's production and use of renewable fuels, while providing important opportunities to quicken our economic recovery and strengthen our national security," said Kevin Kreisler, GreenShift's chairman and chief executive officer. "We were very pleased to see the RFS2 emphasize this while underscoring the catalytic role of advanced new technologies such as our patented corn oil extraction technologies."
"GreenShift's patented backend corn oil extraction technologies are proven to deliver increased profit, reduced energy costs, a smaller carbon footprint, and lower risk to ethanol producers," added Kreisler. "The recognition and affirmation of these benefits by the EPA is both humbling and extremely exciting. We have several years and many tens of millions of dollars invested into the development of these technologies, and we look forward to earning a return on that investment for our shareholders as we work to integrate our extraction technologies into the majority of the ethanol industry as quickly as possible."