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Ethanol pipelines, terminals may increase transportation efficienciesNebraska Moving ethanol from production facilities in Nebraska and other Midwestern states will continue to evolve over the next few years as ethanol terminals and ethanol pipelines enter into the mix. "It only makes sense that as ethanol facilities currently under construction come online and demand in highly populated areas grows, that terminals capable of storing ethanol and loading large trains would sprout up," said Randy Klein, the Nebraska Corn Board's director of market development. "As part of that, ethanol pipelines may be a good option, either moving ethanol to a regional terminal or from a terminal to the coasts." Klein said two recent proposals on ethanol pipelines--one in Nebraska that would bring ethanol to a regional terminal in the state and another that would start in Iowa and travel to the Northeast--may both be feasible and good options for moving large amounts of ethanol. "Other companies are examining shipping ethanol through existing pipelines using their own methods and technology," he said. "In fact, one company is already studying moving batches of ethanol through their existing pipelines in Florida." Having transportation options will help make ethanol producers more efficient, Klein said, and could lower costs, especially for plants that may have limited choices now. The company behind the proposed Nebraska pipeline, which would move ethanol from several plants to a rail terminal in the central part of the state, calculated that ethanol shipping costs could be 9 cents less per gallon of ethanol produced. "For a plant that produces 30 million gallons per year, that would equate to a savings of about $2.7 million. When plants are looking to become as efficient and cost-effective as possible, that's a significant savings," Klein said. "If a pipeline moves about 1 billion gallons of ethanol per year, that would save Nebraska ethanol producers some $90 million." With ethanol production capacity in Nebraska likely to surpass 2 billion gallons next year, increasing transportation options via pipelines and ethanol terminals could have other benefits, too. "That would mean fewer trucks on the road and more coordinated rail movements, or fewer trains overall, especially for the pipeline being discussed to move ethanol from the Midwest to the Northeast," Klein said. Other countries are also working on ethanol pipelines, he said. "Brazil has one pipeline moving a small amount of ethanol now, but has plans for two large ones that would move ethanol to the coast," Klein said. "Brazil, like the United States, has seen ethanol production expand quickly. Although Brazil's goal with pipelines is exports, ours is simply to see ethanol move more efficiently to where it will be used." It will take time for the transportation infrastructure to catch up to production, he said, but when it does, ethanol will become an even better value for consumers. The Nebraska Corn Board is a self-help program, funded and managed by Nebraska corn farmers. Producers invest in the program at a rate of 1/4 of a cent per bushel of corn sold. Nebraska corn checkoff funds are invested in programs of market development, research and education. 3/17/08 Date: 3/12/08 Advertisement
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