Saturday, January 19, 2008

Ethanol from Rice

A few posts ago I mentioned the state of the Japanese ethanol industry, or lack thereof, but a recent article in Reuters caught my eye and I'd like to take a second to give you an update on what is going on with ethanol in Japan. Although biofuels are not and will never be a major factor in Japanese gasoline, because of the small land area and low biomass potential, the Japanese government is not totally turning its back on the fuel. The fact that Japan must import nearly all of its petroleum necessitates a keen desire to leave no stone unturned. And so the Japanese government is going to pay half of the $15 million dollars to construct an ethanol plant in Niigata Japan under the control of the National Federation of Agriculture Cooperative Associations (or Zen-noh in Japanese). For those of you familiar with ethanol economics, you may quickly realize that $15 million dollars for an ethanol plant is a real steal. Well, the answer is yes and no. The reason this plant's capital costs are so reasonable has a lot to do with the fact that, when finished in March 2009, will only be able to churn out 220,000 gallons of ethanol per year. Compare that with some of the smallest ethanol plants around the Midwest with the capability of producing at least 30 million gallons of ethanol per year and you can see that the Japanese are not expecting to change the face of their automotive industry with the plant.

The idea behind a small biofuels plant is to allow the biomass waste from Japanese extensive rice crop to be used in a constructive way to try and offset Japan's thirst for automotive fuels (Japan is third, in gasoline fuels consumption behind the US and China, at 15.8 billion gallons per year). Forth if you count the state of California. But back to the ethanol plant, another reason for the ethanol plant is that low profitability in Japan's rice fields due to cheaper imports cutting out their bottom line has forced many farmers into the major cities leaving behind abandoned fields. The Niigata plant hopes to take advantage by planting non-edible rice that has a higher conversion ratio into ethanol to be used in their plant. The Japanese government is also sponsoring two other small (3.3 million gallon per year) ethanol plants to be built in the Northern Japanese island of Hokkaido using the same rice to ethanol concept.

If all works out by 2009, I guess this just might legitimize the term "rice-burner" used so often in the United States.

Below is a beautiful picture of the Western suburbs of Tokyo with Mt. Fuji just visible on the horizon.

Picture courtesy of:

For the original article from Reuters, follow the link below:

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