 Aloha. Welcome to Think Tech Hawaii's Movers, Shakers, and Reformers. I'm your host, Karl Kampanya. Today, we are going to do a deeper dive into biofuels in Hawaii and the alternative fuels supply chain necessary for the local and global transition towards transportation fuel sustainability. So what are biofuels? Biofuels are made from biomass, which is contemporary organic and biological matter, from living or recently living organisms. Restated, biomass refers to plants, or plant-based materials, which are not used for food or feed, but do include food and feed waste, and can be converted directly into liquid fuels. Fuels are produced from the biomass through contemporary processes, such as anaerobic digestion, hydrolysis, pyrolysis, and gasification, rather than the fuel produced by the geological processes that formed fossil fuels from prehistoric biological matter over millions of years, such as coal and petroleum. So that's contemporary biological matter versus prehistoric biological matter. One important distinction between the two is that biofuels can be renewable and sustainable, whereas fossil fuels have a finite supply, which is not being renewed. To be clear, this is not a conversation about climate change, though there is a connection related to emissions. Instead, this is about addressing the resource diversity, price shocks, as well as reliability and availability of fuel sources for the air, marine, and ground transportation industries today and into the future. Okay, the two most well-known biofuels are ethanol and biodiesel. These are often considered first-generation biofuels, which seems to mean that they are derived from sugars, starches, oils, fats, and grease as opposed to the second-generation biofuels, which are derived from plant matter primarily. So let's consider first-generation biofuels. Ethanol is an alcohol, the same as beer and wine, although undrinkable, and is produced primarily from corn and sugars. It is most commonly made by fermenting any biomass high in carbohydrates through a process similar to brewing beer. Ethanol can also be produced by a process called gasification. Gasification systems use high temperature and low oxygen environment to convert biomass into synthetic gas, which is a mixture of hydrogen and carbon monoxide. This synthetic gas or sin gas can be converted into ethanol and other fuels. Currently, ethanol is used mostly as a blending agent with petroleum-based gasoline in order to increase octane and cut down carbon monoxide and other smog-causing emissions. And then there's the microscopic algae, or microalgae organisms, which use the sun's energy to combine carbon dioxide with water to create biomass more efficiently and more quickly than plants. The oil-rich microalgae strains are capable of producing the feedstock for a number of transportation fuels, including biodiesel and jet fuel. One other interesting example is biobutanol, which is made from bacteria or algae and can potentially be used directly in standard gasoline engines with no modifications. Very important concept we'll explore in a minute. Now biodiesel is primarily made by combining alcohol, usually methanol, with vegetable oil, animal fat, or recycled cooking grease. It can be used as an additive to reduce vehicle emissions or in its pure form as a renewable alternative fuel for diesel engines. Air Hawaii is also used by our electric utility to produce electricity as they burn it in some of their generators. Now for the second generation biofuels. These biofuels are demonstrating a significant advancement and promise for the industry. As most plant matter is composed of cellulose, hemicellulose, and lignin, there are now the second generation biofuel technologies able to convert these directly into liquid fuels. As commercially viable, these could significantly expand the volume and variety of sources that could be used for biofuel production. Potential cellulosic sources include municipal waste and waste products from agriculture, forestry, the processing industry, as well as new energy crops such as fast growing trees and grasses like napier grasses in addition to eucalyptus trees. Finally, we have the third generation biofuels. This is a very important and desired and very much desired development as it is what is called a drop in fuel, which means it can be dropped right into the fuel tanks and distribution channels without need for engine or infrastructure modifications, much like we heard with biobutanol. This helps bring us much closer to the all-important goal of cost parity with petroleum fuels. As a result of these developments, the second and third generation biofuel production could present major advantages in terms of environmental sustainability and reduced competition for land with food and feed production, as well as creating the resources needed for a more diverse fuels portfolio as we transition away from fossil fuels. So please tune in to future shows when we interview some of the various local stakeholders to learn about policy, feedstock, and conversion processes. After a quick break, which we will take right now, we are going to explore the alternative fuels supply chain a bit more directly. So mahalo for joining us. This is Think Tech Hawaii's Movers, Shakers, and Reformers Biofuels in Hawaii. I'm your host Carl Kambanya. See you in a minute. Hi, I'm Ethan Allen, host of Lakeable Science on Think Tech Hawaii. I hope you'll join me each Friday afternoon as we explore the amazing world of science. We bring on interesting guests, scientists from all walks of life, from all walks of science, to talk about the work they do, why they do it, and moreover why it's interesting to you. What science really means to your life, its impacts on you, how it's shaping the world around you, and why you should care about it. I do hope you'll join me every Friday at 2 p.m. for Lakeable Science. Hello, I'm Marianne Sasaki. Welcome to Think Tech Hawaii, where some of the most interesting conversations in Honolulu go on. I have a show on Wednesdays from one to two called Life in the Law, where we discuss legal issues, politics, governmental topics, and a whole host of issues. I hope you'll join me. Hey, everybody, my name is David Chang, and I am a new host for the show The Art of Thinking Smart. I'm really excited to be able to share with you how to get the smart edge in life. We're going to have awesome guests in the military, business, political, nonprofit world, so no matter what background you're from, we have something for you. Please join us every other Thursday at 10 a.m. at ThinkTechHawaii.com or on TheArtOfThinkingSmart.com. I look forward to seeing you. Welcome back to Think Tech Hawaii, viewers, checkers, and reformers and biofuels in Hawaii. I'm your host, Carl Kimbutt. In the last segment, we defined and explored what are biofuels. We will now explore the supply chain needed to advance the biofuels industry for the transition away from fossil fuels. So what is needed to have a vibrant alternative fuels supply chain? Let's begin with the basics of a supply chain. In its simplest form, you have production, logistics, and consumption. But what you are producing? How and for whom and why depends on market needs as well as requirements. For the alternative fuel supply chain, you have the needs and wants of the consumers that are driving the other facets of the chain. In this case, what we have, we have the Department of Defense. We have the Department of Energy. We have airline and marine industries. We have ground transportation industries that are all very much interested in trying to advance and develop alternative fuel sources for a number of means. Cost stability is one of the major factors to that. When we talk about energy security, it's one of the pieces that we're referring to, how we can secure the availability of an energy source and have it be consistent. Price shocks is a very difficult facet of doing any business and running any business operationally. So your operational costs are a huge impact. And if you don't know what those prices and those costs are going to be from year to year and so forth, it can be a problem. So what we're looking at here is the Hawaii Fuel Distribution System currently. We have crude oil coming in, jet fuel coming in, ethanol coming in, everything up to biodiesel. You see there's a tiny amount of biodiesel that's coming in right here. And through all that whole thing, you can see this is just on Oahu. You can see how it's all connected and it all provides and supplies sources to all of the industries. Through the trucking, through piping, we have refineries as well as pipelines that run from location to location. And then we also have to reconnect those to the oil rigs that go back out to the outer islands, to all of our neighbor islands. So what this is showing us is the significant amount of crude oil and jet, compared to jet and then ethanol and then as we go down the line to biofuels. So what we see is our significant dependence on these petroleum-based fuels and how that can impact us. And many of us have seen over the years how just our gas prices, as we drive to the gas station, they go up and down. And they go up and down entirely based on what those fuel prices are as we get them imported. So okay, in order to better address the operational costs and resource reliability, the U.S. Department of Defense, as I mentioned, and energy, along with the airline, marine and ground transportation industries, have all expressed a strong interest in alternatives to petroleum-based fuels for decades, specifically generated from the top, tropic and subtropic zones, such as Hawaii. The reason for tropic and subtropic zones is that it allows for year-round production. Okay, so what is next for the alternative fuels supply chain, now that a demand has been declared? First, you need the feedstock producers and the conversion technologies to advance or mature in order to achieve enough volume of the specified fuel types at a reliable pace and for a competitive price. Sounds simple enough, right? Once the producers and technologies begin to show commercial viability, pricing and volume, the material logistics companies ramp up to transport the materials from production to conversion and then from conversion through the distribution networks so that the fuel can be purchased and then consumed. So okay, let's now recap the entire alternative fuel supply chain. Feedstock production leads to material logistics to conversion, which then leads to the conversion process, and then we once again must return to material logistics through distribution, which then leads to the purchasers and the consumers. So we have the biomass sources that get generated, we get put through the entire infrastructure system, including the refineries, the storage capacity, the pipelines, the ships, the tankers, the trucks, that entire process right up into the gas stations and supplied specifically to our DOD, really across the board. So what we're seeing here are images of refineries. We have the ethanol refinery right here, the previous one that we saw was that one right there, that's petroleum refineries. You can see there's a drastic difference just in the smoke and the clouds that are relevant to that. Now there have been a lot of things done with the point source emitters or the smoke stacks these days to sort of prevent as much of that smoke that comes out as possible, but that's one of the emissions concerns. Alrighty, okay, so who are the people associated with each step? The feedstock producers are the farmers, the scientists and the investors. The material logistics are the shipping, trucking and handling companies. The conversion technologies are the technology inventors, which includes engineers and scientists as well, and the investors that support them. Distribution is the pre-existing infrastructure network that transports and pipes the fuel to commercial and retail locations. The first purchasers are the commercial and retail locations, and the end user purchaser is the consumer or the U.S. Department of Defense, the airline, marine and ground transportation industries, which also includes you and me as we drive into the local gas station to buy fuel for our cars. So is that all? No, not by a long stretch. Currently, we are still developing both the feedstock and conversion technologies towards maturity. Feedstocks have come a long way. Conversion technologies, there are still some questions and there's a lot of testing and analysis that's going on there. Both have their share of internal and external challenges as we learn what grows best and most efficiently here in the tropic zone of our Hawaii. So the internal challenges for the producers include production efficiency and operating costs. The external challenges are many. First, they need sufficient water, land and labor resources, including permitting and land use allowances. And then, whether they can sell the product, certainly at the volume and price desired. And to help that, are they supported by favorable local and national policy initiatives? Now the internal challenges for the conversion technologies include research and development with testing for fuel specifications, specifically for compliance with ASTM standards, conversion efficiency, scalability, so how do we ramp it up to produce as much as we need, and then the operating costs. The external challenges include feedstock resources and labor availability, the ability to sell the fuel once it's produced, storage and distribution logistics. And to help all of that, are they supported by favorable local and national policy initiatives? I hope you can see the common themes there. Finally, who are the people trying to develop this supply chain? And what more do we need to advance it? In the coming weeks, we will interview local Hawaii stakeholders from the various parts of the supply chain to include some producers and conversion technology practitioners, investors, legislators and consumers. We will need input and action from all stakeholders if we are to achieve the goal of a mature supply chain. Some needed actions include the creation of a county-based statewide alternative fuels initiative similar to the Hawaii Clean Energy Initiative to go along with the most recent bill that was passed. Just this last legislative session, 2016 legislative session, the biofuels production tax credit bill was passed. It took five years in the making to get here. It just passed and was just signed this July by Governor David Egan. So that was very exciting and now provides for the opportunity. And you can see here a picture of the governor after he signed this bill. So it's very exciting and it really picks up where some of the previous initiatives left off. So some other needed actions include the need for consistent and reliable permitting. And land use allowances to assure resource needs are available. And then the industry itself needs to make some decisions on conversion technologies that are to be fully invested and developed. What we see here is a picture of land utilization. So the Department of Agriculture for the State of Hawaii has produced this image showing where we are currently using land for agricultural and pastoral purposes. Some of that is actually going away, for example, sugar. As we all know, sugar is going away. We no longer have sugar plants and sugar plantations. Whether that's a good or a bad thing is not a relevant question from a value perspective unless it has to do with how are we able to produce the fuels that we need and is ethanol something that could have been used? Yes. But what we can see here is there's a lot of land that is currently being used, but there's potentially a lot of land that is available. There is one statistic that was provided to me by the Sierra Club actually that has, by the Sierra Club of Hawaii specifically, that let us know that there's 250,000 acres of land available for some form of agriculture. So some agriculture will be able to do food and feedstock side by side. And that's necessary and that's important. And then there's other types of feedstock development and production that do not include or do not require fertile land. Algae is one example and there are several others as well. So it would really be an important step to make sure that as we go forward, we are recognizing identifying locations that are near the water resources and other resources needed to make sure that we can advance each of these steps. So the future is promising if only we act, so let's see what can be done. So all right, so join us as we explore Hawaii biofuels going forward. Next week, Mr. Tyler Sabota, former RISE Fellow and Current Renewable Transportation Planning Technician for the University of Hawaii Applied Research Lab will be hosting the show and giving us a clean transportation update from the Verge Summit this past June. There was much talked about at that summit. From a renewable fuels perspective, there is the, well, organized and run by the Hawaii Department of Transportation. There's the Renewable Fuels Forum, Renewable Transportation Fuels Forum specifically. And we also held a clean fuels summit. So he's going to give us an update on that, so I hope that you do please tune in. I will return myself on September 21st when our guest will be Mr. Will Cush of Tarviva. Tarviva is a local feedstock producer. So we're going to hear from them, hopefully we get some images from them on what their actual production is and what it looks like, and we're going to hear from them what some of their challenges are. And yes, exactly, what you see right here is a picture of the Pungamia. This is what they're producing. And this provides a, well, this is one of the second generation biofuels that we're referring to. We can actually utilize this to create biofuels. And they're one of the groups, one of the organizations and companies here in Hawaii that are really trying to pave the path in order to help us achieve these goals. These goals are driven by, as I mentioned, the Department of Defense. They have initiatives. Each branch of the military has their own initiative as far as energy needs and security. For them, making sure that they have a reliable, available, and cost-effective fuel is helping them achieve their mission. So that's a huge aspect for them. Then we look at commercial operations and how important that is. So that's why all of these, all of this effort, all of these companies, many investment groups including Gulopono and Blue Planet and countless others have been and will be involved in this conversation to help us achieve these goals. So mahalo to the Think Tech Hawaii staff and crew and to all of you for joining us today. We look forward to seeing you next time and in the many weeks coming so we can learn more about Hawaii biofuels and really how we're going to get there from here. All right, see you next time. Thank you.