“Focus on Energy: Using Biomass for Fuel”

Making ethanol work for the world. ™ Larry Johnson Business & Project Development

Collection Handling Storage

 “Green Energy” Mandates State renewable portfolio standard State renewable portfolio goal Solar water heating eligible * † Extra credit for solar or customer-sited renewables Includes non-renewable alternative resources WA: 15% by 2020* CA: 20% by 2010 ☼ NV : 25% by 2025* ☼ AZ: 15% by 2025 ☼ NM: 20% by 2020 (IOUs) 10% by 2020 (co-ops) HI: 40% by 2030 ☼ Minimum solar or customer-sited requirement TX: 5,880 MW by 2015 UT: 20% by 2025* ☼ CO: 20% by 2020 (IOUs) 10% by 2020 (co-ops & large munis)* MT: 15% by 2015 ND: 10% by 2015 SD: 10% by 2015 IA: 105 MW MN: 25% by 2025 (Xcel: 30% by 2020) ☼ MO: 15 % by 2021 WI : Varies by utility; 10% by 2015 goal MI: 10% + 1,100 MW by 2015* ☼ OH : 25% by 2025 † ME: 30% by 2000 New RE: 10% by 2017 ☼ NH: 23.8% by 2025 ☼ MA: 15% by % annual increase (Class I Renewables) RI: 16% by 2020 CT: 23% by 2020 ☼ NY: 24% by 2013 ☼ NJ: 22.5% by 2021 ☼ PA: 18% by 2020 † ☼ MD: 20% by 2022 ☼ DE: 20% by 2019* ☼ DC: 20% by 2020 VA: 15% by 2025* ☼ NC : 12.5% by 2021 (IOUs) 10% by 2018 (co-ops & munis) VT: (1) RE meets any increase in retail sales by 2012; (2) 20% RE & CHP by States have an RPS 6 states have goals KS: 20% by 2020 ☼ OR : 25% by 2025 (large utilities )* 5% - 10% by 2025 (smaller utilities) ☼ IL: 25% by 2025 WV: 25% by 2025* †

BioFuels Production and RFS2

Development and consumption of biomass by DONG Energy starting from 1989.

Inbicon’s raw material know-how: DONG Energy’s 100% biomass-fired power plant.

 368MMDT/Y- Forest Products  998MMDY/Y- Agricultural  1,368,000,000 Total Dry Tons Available  Potential for > 100 Billion Gallons of Ethanol

 Woody Biomass  Designated Energy Crops  MSW and Industrial Wastes  Crop Residues

 Lumber Harvest Residues  Milling Byproducts  Tree Plantations  Orchard Trimmings  Forest Management  Urban Green Wastes

 Sorghum  Sugarcane  Miscanthus  Switchgrass  Poplars/Willows  Algae  Exotics

 Grain Processing Byproducts  Industrial Wastes  Consumer Wastes  Food and Beverage Byproducts

 Wheat and Barley Straw  Rice Straw  Corn Stover  Corn Cobs  Bagasse  Grasses

Inbicon Biomass Refinery 50MT/hr (20Mgpy) On-Site CHP Plant SteamPower Multi-fuel (as req’d) lignin Ethanol C5 Molasses Straw/Stover/Cob Power Steam Existing 100Mgpy Grain-based Ethanol Facility Energy Reduction of %+

1,200 MT/day – 20Mgpy

Baler from Krone capable of pressing 4’X4’X8’ bales weighing about 1300 lbs.

Tarp Covering U.S.

Wheat Straw Storage: Stokervarme, DK

Property (%bdb)Corn StoverCorn Cobs ASH CONTENT 8.13%3.78% CELLULOSE (C6 sugars) 37.49%43.50% HEMI‐ CELLULOSE CONTENT (C5 sugars) 26.54%36.50% LIGNIN CONTENT 16.74%11.60%

 Higher capital costs  Lower operating costs  Very clean product  Contains all the cobs  Reduced volume per acre  Less moisture control  Compliments farmers’ schedule

 Lower capital costs  Higher operating costs  May contain 10% dirt  Contains very few cobs  Greater volume per acre  More moisture control  Requires farmer scheduling

One Pass Stover Bale with Cobs

One Pass System

 200, tons/acre  500 farmer acres/farmer  Each contract will have options/variables  $15 million in $30/ton  250 acres for storage sites

 800, pound density  20,000 bales/day in a 40 day harvest season  555 semi-loads per 36 bales/load  50 balers 100 acres/day

 What does the plant need?  Cob/stalk ratio  What will the plant accept?  Moisture content  What is the pricing formula?  Contract specifications

 Use GIS analysis and regional crop history  Coordinate radius with road delivery system  Estimate tons harvested per acre  Calculate % of total available acres needed

Defined 25 mile radius of selected plants

Tracking of biomass bales per field

Feedstock Supply Analysis Create Procurement Company Develop Procurement Model Initiate Procurement Contracts Define Collection and Storage Logistics Implement Program

 Procurement and delivery contracts  Define logistical and timing details  Credit-worthy feedstock supplier  Financing of procurement company  Staffing - personnel  Equipment requirements  Deposit on farmer contracts  feedstock payment  Fuel purchase and storage  Regional Storage Sites  Insurance

 Host plant subsidiary  Farmer owned cooperative  Independent company

 Identify and contact growers  FCS office (USDA)  Host plant customers  Grain elevators  Farm groups and associations

 Local weather reporting system  GPS field locations  ID and quantify product at harvest  Match harvest with each contract  Identify and coordinate storage sites

 Federal (BCAP)  State (Economic Development)  Local (TIF – Utilities)

 Form a local advisory committee  Identify and contact growers  FCS office (USDA)  Host plant customers  Grain elevators  Farm groups and associations

 Negotiate harvest schedule with growers  Quality control and land use details  Incentives and penalties  Payment guarantees  On farm storage where applicable

Full time staffing activities  General Mgr. and CFO (1)  Office and clerical (1)  Acquire and service contracts (3)  Scheduling and coordinating harvest (1)  Staff hiring and training (1)  Manage harvest crews (1)  Equipment maintenance (2)  Fuel supply infrastructure (1)  Manage feedstock inventories (1)

 Part time staffing (harvest)  Harvest and collection (~50)  Trucking from field to storage (~45)  Manage fuel delivery (1)  Collect and coordinate data (~5)  Miscellaneous “Gofer” (1)

 Identify all growers within a plant radius  Conduct grower informational meetings  Negotiate and sign contracts for delivery

 Balers, semis, loaders, stackers, wagons, fuel trucks, choppers, windrowers  Purchase  Lease  Custom Contract

 Harvesting: Balers, Tractors, Loaders  Trucking: To Plant and Regional Storage Sites  Stacking: Roadside and Regional Storage

 Grading and Drainage  Road Access  Zoning and Permitting

 Roadside storage  Farmer storage  Tempering  Bale covering  Weighing and accounting

 Field location and harvest date  Bale count, moisture and density  Ownership recording and receipt  Reconciliation with Contract  Storage site destination

Inventory Management  Storage specifications  Fire Protection  Transport from Storage to Plant  Permitting and Zoning  Dust Control  Feedstock Security

Can it be done? Absolutely!

Will it happen? Absolutely!

When will it happen? When we get technology, government, and financing working together.

Making ethanol work for the world. ™