Vital Magazine - Winter 2017 by Vital Magazine

THE ESSENTIAL PERSPECTIVE

Homegrown

SOLUTION Farmers need more ethanol at the pump.

SHIFT S3CTOR hether it is an American muscle car or a foreign exotic, W racers choose ethanol over all other fuels.

THE HISTORY OF POET – CREATING OPPORTUNITY IN CHALLENGING TIMES hen external markets were less favorable, POET looked W inward for growth.

THE GODFATHER OF ETHANOL If you work hard, anything is possible. That’s the American credo.

WATCH ME GROW ifth graders from Corning, IA get a taste of what it is like to be a F farmer and how ethanol plays a role in the ag industry.

Winter 2017

WIPE THAT NEVER SATISFIED LOOK ONTO YOUR FACE. DO YOU CONSIDER HIGHER EDUCATION THE FIRST STEP TOWARD YOUR HIGHER ASPIRATIONS? POET WANTS TO HELP YOU GET THERE.

NEVER SATISFIED A P P LY F O R T H E N E V E R S AT I S F I E D S C H O L A R S H I P AT

POET.COM/NEVERSATISFIED

CONTENTS

FEATURES 8

SHIFT S3CTOR

by Thom Gabrukiewicz Whether it is an American muscle car or a foreign exotic, racers choose ethanol over all other fuels.

18 RETAILERS DRIVE SUCCESS FOR E15 AWARENESS, FUNDRAISER

by Angela Tewalt Consumers respond positively to Growth Energy’s national Pink Out Program.

32 THE HISTORY OF POET – CREATING OPPORTUNITY IN CHALLENGING TIMES

by Steve Lange When external markets were less favorable, POET looked inward for growth.

44 THE GODFATHER OF ETHANOL computer Visit www.poet.com for the latest news, career opportunities and plant profiles.

by Janna Farley If you work hard, anything is possible. That’s the American credo.

50 WATCH ME GROW

by Janna Farley Fifth graders from Corning, IA get a taste of what it is like to be a farmer and how ethanol plays a role in the ag industry.

CONTENTS

COLUMNS 04

IN SIGHT

by Jeff Broin

DEPARTMENTS

PERSPECTIVE

24 FARM FRESH 42 NASCAR® UPDATE 47 RENEW

56 OUT OF LEFT FIELD

by Scott Johnson

MAIL POET, LLC 4615 North Lewis Avenue Sioux Falls, SD 57104

P / 605.965.2200 F / 605.965.2203 ARTICLE SUBMISSIONS Please direct all article ideas, as well as questions or comments regarding the magazine to: vital@poet.com

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COPYRIGHT Vital is published quarterly by POET, LLC and other individuals or entities. All materials within are subject to copyrights owned by POET. Any reproduction of all or part of any document found in Vital is expressly prohibited, unless POET or the copyright owner of the material has expressly granted its prior written consent to so reproduce, retransmit or republish the material. All other rights reserved. For questions, contact the POET legal department at 605.965.2200. The opinions and statements expressed by content contributors and advertisers in Vital are their own and do not necessarily reflect those of POET. Neither POET nor its third-party content providers shall be liable for any inaccuracies contained within Vital, or for any actions taken in reliance thereon.

In the spirit of its continued commitment to being good stewards of the environment, POET is proud to produce Vital using 100% recycled paper, with eco-friendly soy-based ink.

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Publication Design & Layout: Cassie Medema hello@newover.com

IN SIGHT by Jeff Broin, Executive Chairman and CEO of POET

SOMETHING’S GOT TO GIVE There’s an art to telling a good story, one that captures the reader’s attention and carries it through to the end. The conclusion typically offers a moral lesson, reflects upon past actions or outlines a path for the future. For the past six issues, we have shared the history of POET. This story began through humble origins on a family farm near Wanamingo, MN and grew over several decades into the world’s largest producer of biofuels. My father, Lowell, started out by experimenting with ethanol on our family’s kitchen stove and eventually building a farm-scale ethanol distillery, much to our neighbors’ surprise. This type of bold, entrepreneurial spirit led to establishing the foundation for what is now POET. Our tales of POET’s history have caught up to present-day, but I believe our story is only beginning. As a company, we are always looking and thinking ahead. What’s the next big thing? What’s the next innovation that will propel POET forward? What’s the next barrier to break? When this story began nearly thirty years ago, I never thought cellulosic ethanol would become a reality, or that competitive sports like Indy and NASCAR would run on biofuels. I never imagined POET would be the catalyst for such change, but we can’t stop there. Now is the time to start dreaming again. It’s time to dream about the day when renewable, homegrown American ethanol takes up more of the gas tank. It’s time to dream about higher fuel blends blanketing the country and the world. It’s time to dream about a time when our children and grandchildren no longer have to worry about their health because of gasoline’s cancer-causing carcinogens. It’s time to dream of a day when our brave men and women in uniform no longer have to fight to defend our nation’s imported oil supply. We know all of these dreams are possible, but they will not become a reality without all of us working hard and working together.

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Ag producers and ag companies know better than anyone that we’ve reached a crossroads. Farmers across the Midwest are experiencing prices below production costs while technology improvements continue to drive up yields. Many operations are facing the same difficult decisions their fathers faced, including my own, during the early 1980s. Prices and farm income have plummeted and corn carryouts have reached record levels. Exports didn’t save the day then, and we can’t rely on them to come to our rescue now. In fact, exports have changed very little in the last 30 years. Something’s got to give and the consequences of inaction and apathy are dangerous. If we don’t fight, if we allow this to happen, this ag crisis will not only affect farmers but will cause devastating impacts on the Midwest, our urban cities and our entire nation. As a teenager in the early 80s, I saw many of my neighbors file bankruptcy or leave the farm. I hope I don’t have to see that again. To solve this problem, farmers need a higher percentage of the gas tank. Rural America has a powerful voice when we decide to use it. We made ourselves heard during the presidential election and we need to use that same voice again now. Agriculture producers, ag companies, grain producers and stakeholders need to let Washington, D.C. know we need a larger share of the gasoline market. This is the only true solution to stave off this impending ag crisis. Driving toward higher blends like E15, E30 and even E50 will have positive ripple effects throughout our economy. That’s a message Capitol Hill and the Trump Administration need to hear. Consumers deserve a lower priced, higher quality product. The oil companies will fight agriculture at every turn, but agriculture deserves to win. Our nation’s sixth president, John Quincy Adams, once said: “If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” I firmly believe we have the power and potential to lead and to change the future of agriculture and the world. The moment to act is now – I hope you will join me.

Contributing Every Day to the Lives of Ordinary Americans Our processes and equipment contribute to thousands of products we use dailyâ&#x20AC;Śthe OJ we drink in the morning, the cheese sandwich we eat for lunch, the fuel we fill our cars with, the medicines we take to be well, even the water we drink. For over a century, GEA has been working to help make the products that make our world what it is today. Moving forward, our commitment continues as we work with POET to provide the separating technology required to produce renewable biofuels and agricultural co-products. To learn more about GEAâ&#x20AC;&#x2122;s centrifuges and separation equipment

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and the industries we serve, email us at sales.unitedstates@gea.com, call 800-722-6622, or visit us online at gea.com.

SOCIAL MEDIA SNAPSHOTS

10/25

“#Ethanol wins as an octane enhancer ‘on both performance and cost.’ 25%-40% blends are fuels of the future. – Doug Berven, POET #poetproud #biofuels #engines”

@1block

10/26

“Thank you to @sheetz for committing to #ConsumerChoice & offering #E15 in Manassas, VA! Customers #ChooseE15 to save money at the pump!”

@growthenergy

11/15

“#NASCAR will surpass 10 million competitive miles driven on clean, reliable #E15 this Sunday at Phoenix International Raceway. #AmericanEthanol has allowed NASCAR to cut #GHG emissions while still providing high-performance fuel! #AE10Million”

@americanethanol

11/16

“@GrowthEnergy CEO @EmilySkor shares why @AmericanEthanol is #earthfriendly & good for all thanks @ksmitSD @keloradio”

@kmanning 6

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11/17

“Check out the new blender pumps at Cenex in Lennox, SD. #poetproud #biofuel #renewableenergy”

@r.kloos123

11/22

“The smiling faces of our future! Dani (left) graduated from #SouthDakota School of Mines and Technology with a degree in #chemicalengineering, and we’re lucky enough to now call her an Associate Process Engineer for POET Design & Construction! What are you #NeverSatisfiedUntil you’ve achieved? An internship or career at POET could be your opportunity: http://www.poet.com/ #POETproud #SDSMT”

@poetproud 11/25

“8 year old mini me cooking up some perfect pancakes at the breakfast table using #poetproud ethanol on a clean cooking stove. This stove works great!”

@cbergsd

11/28

“A behind-the-scenes look at @souleschris’s work to spread the good word about the benefits of ethanol during this year’s Iowa #E15 day!”

@getethanol

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SHIFT S3CTOR

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Whether it is an American muscle car or a foreign exotic, racers choose ethanol over all other fuels. by Thom Gabrukiewicz

photos courtesy of Evolutionized Photography and Shift S3ctor

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This isn’t your daddy’s speed circus, kids – as in 84-year-old “Big Daddy” Don Garlits, considered to be the father of drag racing and who used nitromethane (a fuel that combines propane and nitric acid) to first surpass 170 miles per hour in a funny car. Oh, no kids, far from it. This is Shift S3ctor, which began in 2011 as the first-of-its kind organization to bring side-by-side roll racing events to the West Coast. Born out of the outlaw need for speed, mainly not-so-legal street drag racing – Shift S3ctor created its “Airship Attack,” a series of half-mile drag racing events utilizing airport runways that is an invitation for anyone to test their mettle (and metal) against the fastest machines in the world. Side-by-side. Whether it be a big American Chevy Camaro muscle car, or a foreign exotic – like an Italian-made Lamborghini – these folks are pushing the envelope of speed. And fueling all this ruckus is clean-burning, American-made ethanol. What’s that, you say? Ethanol – like the E85 they sell at the gas station? Exactly. “I’d been running ethanol in my own (drag racing) car even before I heard of Ignite or Growth Energy or any of those guys,” said Shift S3ctor co-owner Jason Huang. “Me and a bunch of other guys started running ethanol, E85 basically, as a racing fuel to get the higher octane content. I

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started experimenting with it and had great results with it.” Huang said a chance encounter with Jay Berry and Ignite Racing Fuels actually cemented his belief in ethanol as a race fuel, and as a fuel for the general public. “We actually started working together to co-promote some events, he was generous enough to give us some sponsorship money, and we started to get

the word out there,” Huang said. “And we’ve seen a huge turnaround in the amount of cars using ethanol.” American Ethanol Racing is a collaborative partnership, which highlights the reliability, affordability and the performance capabilities with ethanol. Since 2011, American Ethanol has created partnerships with NASCAR and Ignite Racing Fuel to further ethanol’s reach into the sport. That, in turn, has helped owners and drivers in other

racing disciplines – like boating, drifting and yes, drag racing – really see what ethanol can do for performance. “What we’re seeing is ethanol being used in a much wider variety of cars and a much higher percentage of cars are using ethanol previous to using other racing fuels,” Huang said. “People tend to stick to what they know until they educate themselves. The biggest thing about ethanol that I find is education. There’s a lot of myths out there about ethanol that need to be broken – and we need to get the word out about the benefits of ethanol that people just really don’t understand yet. It’s not just gaining horsepower, or the engine cooling effects. Our approach for marketing American Ethanol is really to educate – to get paperwork out there at the event, get links up on the boards to the websites. But more to get it into some world-record cars and a lot of competitive cars so people say, ‘Wait, that guy just went a lot faster than me, what’s the difference?’” “That difference is ethanol,” he added. Word of mouth is growing. When Growth Energy launched its partnership with NASCAR in 2011, research into its fan base revealed that about 50 percent of NASCAR fans were supportive of ethanol in their vehicles, according to Kelly Manning, Vice President of Development

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for Growth Energy. Today, the same research indicates that number has grown to 80 percent acceptance. “This has been an awesome partnership for us,” Manning said of American Ethanol’s partnership with Shift S3ctor. “This really validates the performance and quality of ethanol, where the regular consumer, or even race fans, would look at someone who works at POET or someone in the (ethanol) industry and think, ‘Well, you’re just saying that. You’re not the one building the engine, or the car.’ And that’s the beauty of this sport, and some of the other different areas of racing. The owners, the drivers, they love it. It runs cooler and the positives just go on and on.” Shift S3ctor’s other co-founder, Ryan Fisher, and Shift S3tor event coordinator, Chris Bennett,

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echo Manning’s assessment that ethanol is making a huge impact in drag racing. And they’re seeing the fans’ support of the fuel, by seeing what ethanol brings to racing engines, and are willing to try it in their own vehicles. “So ethanol has really jumped into the scene in the last couple of years,” Fisher said. “There used to be more of a perception on turbo cars and ethanol, and now there’s these big-horsepower, domestic Corvettes and Mustangs that are running ethanol and it’s really opening up the eyes of a lot of people. So you can see it just tackling obstacles, kind of moving walls down and opening up for more people to see the gains and the greatness of it.” “The top performers are using it and the little guy can go buy into it, too,” Bennett said.

“It’s one of those things, the average race guy, the little guy, is seeing the big guys use ethanol, it’s working for them, so they say, ‘I want it, too’ kind of thing.” “It’s a cost-effective way for anybody to try at least a couple of gallons to see how it works in their car,” Bennett continued. “I think, from our perspective, ethanol is making things more affordable and more accessible to everybody, including the drivers and the fans.” So let’s shift away from organizers and the industry guys, and talk directly to drivers who run ethanol in a highperformance drag racing vehicle. Like Las Vegas natives Anthony Taylor and his fiancé, Adria Abkar. In 2015 Taylor set the halfmile speed record for a Porsche, clocking 219.30 miles per hour in his Porsche EVT 1700 997 Turbo.

Abkar drives a Nissan GT-R – also fueled by ethanol. “You know, ethanol just makes the car run really well,” said Taylor, who has since sold the record-setting Porsche and picked himself up a Nth Moto TT Lamborghini Gallardo SL. (By the way, you can follow Taylor on Instagram at kchme911.) “It’s just great for the engine,” said Taylor, who has been racing for four years. “It makes so much power and a lot of torque. It makes racing affordable, too, to a certain extent, because there’s just some people who can’t spend up to $20 a gallon on (traditional specialized racing fuels), you know what I mean? There’s Jay Berry’s Ignite racing fuel (high-performance ethanol) that’s $3 a gallon. Or, people can go get their ethanol at the pump, like E85. Racing doesn’t always

have to be super-expensive, because if you’ve got ethanol, anyone can have a good racing fuel at a good price.” “The thing about ethanol is the price is so attractive,” said Abkar, who started street racing 10 years ago as a 16-year-old in her Honda Integra. “It’s really easy to go really fast on a budget. Let’s face it – 100-octane fuel is like $8 a gallon, but you can get E85 at the pump for $2. It’s a much cheaper alternative fuel – and you can go really, really fast, which is awesome.” Let’s just pause right here and ask Taylor – what’s it feel like to drive a vehicle at 219.30 miles per hour down a half-mile straightaway? “It literally takes your breath away,” he said. “A great comparison would be the superman ride at Six Flags.

You’re thrown back into your seat so hard and you start to get tunnel vision.” OK, let’s resume. “Not everyone out there makes crazy money, but still wants to race,” said Taylor, who when he’s not racing, is a waiter. “Ethanol gives drivers the chance to afford it and have fun racing.” So race fans – should the American consumer run an ethanol blend in their passenger vehicles? “I just bought a 2013 Cadillac CTS-V, and I’m going to get it tuned so I can run E85,” Abkar said. “But I’m so looking forward to that, because I’m going to be able to go much faster. And it’s just my regular ride.” “It’s healthy for the motor,” Taylor said. “It’s a great power additive that anyone can get at the pump. You know, I’d rather

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run more than E15 in my car, I’d run 90 percent if I could.” “I think the product sells itself,” Shift S3ctor’s Fisher said. “It’s cleaner, it produces power, it’s efficient, it’s sustainable – there’s so many great things about it. If more people knew that, then they would jump onboard. It’s just getting the message out to guys like us – racers to car guys that are the ones tinkering, building cars and if you do a side-by-side comparison, there’s no question. “We just want to see ethanol go crazy.”

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PERSPECTIVE

From the Outside In: Different Perspectives from Around the Country

“ Which of the following is most important to you when choosing which fuel to use in your car and why?

”

ENERGY

HEALTH

CLEANER

ENGINE

INDEPENDENCE

EFFECTS/

AIR/BETTER

PERFORMANCE

LESS

FOR THE

TOXINS

ENVIRONMENT

BETH BYSTROM, 27, VETERINARIAN, AVON LAKE, OH

“The most important to me is price when I’m fueling my car. I always choose the cheapest gas price. My car is very fuel efficient, but I am a frugal person and usually go with the lowest price every time.”

PRICE

JENNIFER WOZNIAK, 45, MEDIATOR - UNION REPRESENTATIVE, LOS ANGELES, CA

“Cleaner air/better for the environment is my first choice. My second choice is energy performance.”

The views expressed by third-parties in this do not necessarily reflect the opinions of POET. Instead, they aim to offer readers a glimpse into how different areas of the country view issues important to the industry and to agriculture. 16 vital || THE ESSENTIAL PERSPECTIVE

TIM RUHNKE, 53, UNIVERSITY PROFESSOR, CHARLESTON, WV

“My fuel purchases are linked to need (to fill the tank), convenience and price – in that order. I generally try use the fuel points from Kroger grocery store to achieve a discount.”

SHELLI WAGNER, 53, SOCIAL SERVICE WORKER, FREMONT, NE

“I make the decision on where to purchase my fuel according to location of the station and price. The next deciding factor is the effect to the environment.”

TONI PERREIRA, 56, RETIREE, BUCKEYE, AZ

“While concerned about environmental effects and engine performance, driving a gasguzzling Jeep makes price the most important factor for me.”

BRITTINY MORRISON, 29, DIRECTOR OF CHAMBER MEMBERSHIP & COMMUNICATIONS, SHERIDAN, WY

“As a single mom, my decisions on fuel for my vehicle are sadly based on my checkbook. I’d love to be able to do what is good for the environment – and what will improve my car’s performance – these things are important to me in theory. Unfortunately, the honest truth is that I am on a budget and have to go with what is the least expensive option.”

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RETAILERS

drive success for

E15 AWARENESS,

FUNDRAISER Consumers respond positively to Growth Energyâ&#x20AC;&#x2122;s national Pink Out program by Angela Tewalt

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There’s a new product on the market, and this fall, it was hard to miss. Over the past couple years, Growth Energy has spent a lot of time building a new marketplace for E15, and this October, they launched the Pink Out program, a campaign that not only would build consumer awareness but would raise money for local charities. And it has been quite the season of success. E15 is a higher octane fuel that is approved for all vehicles 2001 or newer. That’s 86% of vehicles on the road today, says Mike O’Brien, Growth Energy’s Vice President of Market Development. So Growth Energy got to work. Before they launched the Pink Out program, O’Brien says they began with infrastructure. And it was a big effort. Much of this work was made possible by Prime the Pump, a nonprofit which works to pool industry resources for the advancement of E15 and higher ethanol blends. “There is a mountain of work in identifying sites, getting the pumps installed and getting these programs going,” O’Brien says. “It takes about two years to get all the infrastructure in place, but where we are turning our attention to now is the marketing side. How can we help the retailers increase their sales of E15?” The Pink Out program was a great place to start. Participating retailers included Minnoco, Sheetz, Protec and Murphy USA,

placing E15 at 720 dispensers across Minnesota, North Carolina, Iowa, Illinois, Arkansas and Florida. When they considered the market, they looked to women, their key consumer target. “The female audience seems to have a keen interest in ethanol and in E15, and they also appear to be more aware of carcinogens and clean air,” O’Brien says. “So we tried to develop programs with both of those things in mind.” O’Brien says Pink Out is also a nice kickoff to more joint marketing programs in the future. This is only the beginning of an already successful promotion for E15.

WHAT IS THE PINK OUT PROGRAM? The Pink Out program originally began in 2015 as a fundraising initiative for Minnesota retailer Minnoco. They had some customers struggling with breast cancer and wanted to do something special for October’s Breast Cancer Awareness Month that also helped to promote E15. It was incredibly successful for their communities. “Last year, we raised $13,000 for a local charity called Hope Chest, and this year, we raised $15,000,” says Lance Klatt, executive director of Minnoco. “Hope Chest is an organization that helps breast cancer patients with gas money to get to treatments, help them at home with electricity bills, clothing or grocery money. So the money is not going to a huge research

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In support of the Pink Out program the #3 American Ethanol Chevrolet had a pink paint out for the October Talladega race.

firm. This is a local movement where the local individuals really see and feel the money we raise for them.” The participating Minnoco locations rolled out the program with gusto. They put pink nozzles on, pink pump toppers, and all of the employees wore pink shirts that said “Fueling the Fight Against Breast Cancer.” Growth Energy noticed. O’Brien says they were so pleased with Minnoco’s campaign that the Board of Directors volunteered their support, and they decided to roll it out nationally this year. “We started it last year,” Klatt says, “but this year, Growth Energy really took the opportunity and made it bigger.

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They took it to a national level and brought more awareness to it. They’ve done a phenomenal job with that.” And O’Brien says POET is the one who plays the strong leadership role in getting E15 off the ground. “POET has been right in the middle of it and very supportive with all the activities we’re trying to execute to build E15 into the marketplace,” he assured.

CONSUMER REACTION Minnoco has had E15 available at their pumps for three years now, but Klatt says they continue to see a steady increase in

interest and in sales. The genuine investment of the retailers has a lot to do with that success. “This is a learning curve. It’s an education,” Klatt says. “And when consumers arrive at the pump, it’s a new fuel. So my retailers spend a lot of time out at the gas islands explaining this fuel to them. And that’s the magic. These retailers are invested in their properties.” And for good reason. “Not only are these their sites, it’s their livelihood.” Employees at the Sheetz locations in North Carolina have the same investment. Michael Lorenz is the Vice President of Petroleum Supply for Sheetz, and he says his retailers have to be out there talking to consumers,

or they’ll lose a sale. “What I found while engaging customers who were at the pumps is that a lot of them were unaware of the product,” he says. “But once you talk to them about it — without even going into a sales pitch, just purely explaining the facts of E15 — they were extremely interested.” Lorenz says that consumers are merely going through the motions. “Pumping gas is a habit,” he explains. “People pull up, fill up their car like they normally do and drive off. You can be so inundated with advertising and noise going on that I don’t think they are really paying attention.” Grabbing that attention is the responsibility of the retailer, one they have taken on well. “Once they understand, it’s a good story,” Lorenz says. “It’s a good product for a good cause. And it’s important to continue to put that in front of the consumer. When they see it, they like it.” Klatt says that once the Pink Out fundraiser ended, his retailers still marketed E15 with great enthusiasm. “A lot of my older operators are out there themselves, just to talk to consumers about E15,” he says. “That’s their business plan. They are brand ambassadors for E15, and we appreciate their enthusiasm.”

THANK YOU, RETAILERS O’Brien is also grateful to the employees at Sheetz, Minnoco, Protec and Murphy USA. Their energy and respect for their work has made a huge difference in promoting E15. “I love working with the retailers,” O’Brien says. “They are a lot of fun. The way the retailers view it, they just want to sell liquid fuels and be able to make money. They care about a good product they can get to their consumers, and they’ve been tremendous partners.” O’Brien also knows the E15 retailers stand out

more than others. “The people we work with are being much more aggressive than your typical retailer,” he says. “In the retail world, as long as they get the consumer to their

site, the retailer wins. But in the case of our retailers, they have a bias toward E15 and trying to sell more E15 than other grades of fuel. They view that as a critical component to being more competitive than the retailer next to them.” And, these retailers have immense respect for Growth Energy. “I can tell you, multiple retailers have come up and said how much they like working with the ethanol industry and how much they appreciate what the ethanol industry is doing,” O’Brien says. “You certainly feel a kinship.” Klatt agrees. “Without the farmers and ethanol producers, Prime the Pump, POET and Growth Energy, none of this is possible,” Klatt says. “Growth Energy has taken this program to the next level, and we always want to make sure we give them some love.” Another way he’s tipping his hat? Pumping his own vehicle with the great E15. “I’m a cool dad with a Honda Minivan that’s eight years old, and I really don’t see any mileage losses,” Klatt says. “Absolutely, I use E15.”

How much money was raised? Growth Energy’s 2016 Pink Out Program raised a total of $40,465.64 for the four retailers’ chosen charities. Sheetz chose to donate to the American Cancer Society, Protec donated to the Florida Breast Cancer Foundation, Murphy USA donated to Susan G. Komen, and Minnesota-based Minnoco donated to the Hope Chest for Breast Cancer. Minnoco originally began the Pink Out Program last year because they wanted to raise money for local customers who were undergoing treatments for breast cancer. Lance Klatt, the executive director of Minnoco, said they wanted to support Breast Cancer Awareness Month in October while also promoting E15. “The reason we chose Hope Chest as our charity to donate to is because our retailers are local,” Klatt says. “We are a communityoriented organization, and we are big into local and community movements here in Minnesota.”

Roger Green, owner of Minnoco Kaposia Convenience Center, presents Beth Brody, Hope Chest for Breast Cancer Board Member, Nancy Philhofer, Executive Director for Hope Chest for Breast Cancer, Mayor Beth Baumann, mayor of South St. Paul, MN with a check for $15,000.

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IS MADE HERE.

For years, we’ve been told that cellulosic ethanol is a “fantasy fuel.” And it is.

And now it’s going to change the world. For real.

So we’ve spent a decade planning, researching, and working hard to make that fantasy a reality. ®

POET-DSM.COM

Advanced Biofuels

FARM FRESH by Brian Hefty

RECORD CROP,

RECORD NUTRIENT USE As soon as we had completed harvest on just one field of corn this fall, I knew our yields were going to be much better than I had ever expected. In June, we had leaves rolling up in some of our corn fields due to lack of moisture, but after that point everything from temperature to moisture was about perfect for raising corn. Our farm not only gave us record corn yields, but soybeans hit an all-time yield mark, too. Many farmers across the Midwest experienced the same thing we did, record yields.

250 BUSHEL CORN

Unfortunately, high yields are accompanied by high costs including increased trucking, drying and wear and tear on augers and harvest equipment. One of the major things we’re talking to farmers about right now is replacing the nutrients they just removed with that record crop. Assuming the farmer leaves all the crop residue in the field and only removes the grain, here is what big yields can take out of a field. Please note that I’m not even including nitrogen that every farmer knows he needs. I’m just looking at all the other nutrients that are often neglected.

POUNDS

APPROX. COST

Phosphate

$33

K2O Potassium

$14

Sulfur

Calcium

Micros (Zn, Mn, Fe, Cu, B)

TOTAL 80 BUSHEL SOYBEANS

POUNDS

$10 $63 APPROX. COST

Phosphate

$22

K2O Potassium

$21

Sulfur

Calcium

Micros (Zn, Mn, Fe, Cu, B)

TOTAL

24 vital || THE ESSENTIAL PERSPECTIVE

$56

As a farmer, you may not have whole fields averaging 250 on corn or 80 on soybeans, but in a year like this year you may have had many areas in fields at those yield levels. The important thing to remember here is if you donâ&#x20AC;&#x2122;t replace what you remove, you are mining the soil and going backward in terms of soil nutrient levels. `While I realize many non-farmers fear that farmers are over-applying fertilizer, as an agronomist I can tell

you on average over the last 10 years all these big yields are creating the opposite effect. The average U.S. farmer is removing more fertilizer than he or she is applying. Every farmer was applauding the big yields this fall, but the challenge now is to build our soils back to pre-2016 levels and get ready for even higher yields in the future.

Darren and Brian Heftyâ&#x20AC;&#x2122;s AgPhD programs help farmers take their operation from good to great by sharing information ranging from how to maximize your fertilizer program & tiling to stopping those yield-robbing insects and crop diseases and more. If youâ&#x20AC;&#x2122;d like to learn where you can watch or listen to Ag PhD, you can find the listings at agphd.com.

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Homegrown

SOLUTION Farmers need more ethanol at the pump. by Steve Lange

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For American corn growers, the 2016 season has seen record-setting bushel totals (14.5 billion) and record average yields (170 bushels per acre). But this season has also been marked by plummeting prices and “mountains” of unsold corn stored in silos or on farm fields waiting for a market. As Precision Ag practices and everevolving technology continue to drive yields even higher (some experts are predicting nationwide averages of 300-bushel yields within 15 years), the farm industry finds itself at a crossroads as corn production continues to outpace the current market demand. “We’re sitting on mountains of corn, soybeans and milo,” says Jay Schutte, who co-owns a 2,700-acre crop and livestock farm in Audrain County, MO. “Incomes have been dropping. There’s been a lot of talk about tightening credit with farmers, that farmers are stretched on their credit lines. We need to take a serious look at what the next few years could hold.” Midwestern farmers, according to the U.S. Department of

Agriculture, are facing falling incomes and trying to recover from a borrowing binge that began just under a decade ago when grain prices were peaking. A recent Reuters study

analyzed agricultural lending in three states – Illinois, Indiana and Iowa – and found a sharp rise in delinquency rates on farmland and production loans. The same study also revealed another troubling trend: the number of farmers who were “extremely leveraged” has doubled over the past three years. “We have been looking at three

years of net operating losses for a number of our producers,” says Randy Aberle, Senior Vice President of Agribusiness and Capital Markets at Ag Country Farm Credit Services in Fargo, ND. “This season, we have corn piled up all over. A lot of it is not under cover. When you combine that with commodity prices dropping, we need to take a look at how to increase markets in the future.” Those increased markets were helped along slightly by the recent fall of the Environmental P r o t e c t i o n Agency’s (EPA) blend wall, which imposed a 10 percent maximum of ethanol in gasoline. Although cracks in the blend wall are promising, uncertainty remains regarding the future of the Renewable Fuel Standard (RFS) with the new Congress. The industry also faces another artificial market barrier with Reid Vapor Pressure (RVP), which the EPA regulates to prevent increased ozone or smog from vehicle emissions. Currently, E15 is not afforded the same RVP volatility waiver as regular gasoline with 10 percent ethanol,

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even though it is less volatile. Under this restriction, retailers are largely prohibited from selling E15 for use in vehicles 2001 and newer during the summer months. Removal of these barriers – which the ethanol industry have been fighting to tear down for a decade – would create a path for higher ethanol blends (especially E15). In turn, this path creates a solution to increasing commodity s u p p l i e s , which creates an increase for commodity prices. Don Easley invested in his 2,100-acre corn and soybean farm in Marion, OH, in the 1980s. For him, the solution is, literally, right around the corner at POET Biorefining – Marion. That ethanol plant buys 25 million bushels of corn annually and expects to produce nearly 70 million gallons

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of ethanol this year. In total, POET’s 28 biorefineries will buy 650 million bushels of corn and produce 1.7 billion gallons of ethanol in 2016.

“It’s that s i m p l e ,” says Easley. “Farming is down from a price standpoint. The revenue stream has decreased over the last three or four years.

Our overall market has gone down, but our ethanol market has continued to slowly go up. If we had more demand for ethanol, that would help with the excess grain from the higher yields.” It’s no coincidence, says Easley, that the farm sector was at its healthiest – and has experienced record profits – during the height of ethanol growth and expansion periods. “POET, and the ethanol production in this area, is the best thing that’s happened to the ag community in central Ohio in forever,” he says. “POET has a tremendous appetite for corn, and we’re going to need even more of that for the future. More ethanol would give us that stabilization and diversification to move forward again like we were able to in previous years, when ethanol first took off here.” In order for ethanol to make that important jump to the next level of increased production, POET’s leadership stresses that the RFS – the federal program requiring that increasing amounts of renewable fuels be blended into the nation’s transportation fuel – must continue to evolve in order to give consumers more choices at the pump. While the RFS has provided the incentive necessary to develop corn ethanol technology and

the assurance to farmers that the market access won’t fall out beneath them, it will need to be fortified by more E15 options as well as increased choices for consumers, including more ethanol pumps at more major retailers. Turning back agriculture’s tech advancements is not an option. These past four years have produced 57 billion bushels of corn, the highest four-year total in the nation’s history. Ag sustainability and environmental efforts – from Precision Ag practices to cover crops to crop rotation – are advancing like never before. Jay Schutte, who is sitting on that mountain of corn in Missouri, says he’s hoping for more marketing opportunities for

his grain. But he has a hard time understanding why ethanol has not been fast-tracked for higher blends in the fuel supply. “It [ethanol] has done so much when it comes to helping eliminate payment programs and farm subsidies,” he says. “Ethanol has been so good for farming, and it needs to be allowed to keep moving forward.” A “farmer first and foremost,” John Buck is also the founder of TurnKey Leadership Group, which helps farmers assess their long-term direction. For Buck, who farms 1,000 acres in New Bloomington, OH, that “moving forward” needs to happen sooner rather than later. “Right now, farming is definitely in a world of uncertainty,” he says. “We’ve come off these super

prices and great yields to more great yields and not-so-super prices. If something’s not done, these next few years could be the years that weed people out, especially the younger farmers. This bubble could definitely burst.” For Buck, those seemingly simple changes, like a push for E15 and increased ethanol opportunities at the pumps, would bring big-picture positives. “We know that increased ethanol would help us directly,” he says. “But this isn’t just about Marion County and it isn’t just about Ohio and it isn’t just about the United States. It’s a global picture. Ethanol is the next generation for the future of farming, and that future could, with a little push, start happening

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today.” The fight for the future of agriculture is at the gas pump and now is the time for agriculture to get involved. Higher blends of ethanol will be the key to success for future generations, as farmers and the ethanol industry continue to pursue second-generation biofuels. Full rollout of E15 will create demand for an additional two billion bushels of corn. Just imagine the demand – for corn and biomass – that follows when consumers ask for higher blends of biofuels like ethanol.

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The History of POET â&#x20AC;&#x201C;

CREATING

opportunity

IN CHALLENGING TIMES

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When external markets were less favorable, POET looked inward for growth. by Steve Lange

This is the seventh part of a series on the History of POET. Installments 1-6 can be read in the previous issues. WWW.VITALBYPOET.COM

In the previous issue of Vital, we told the story of POET’s name change, which culminated with a surprise appearance from Neil Armstrong. Now armed with a new name and singular identity, POET was poised to begin its next chapter as an industry leader with new challenges on the horizon. It was 2008 – with the Blend Wall looming and with corn prices on the rise, followed by ethanol companies falling into financial distress and even bankruptcy – the biofuel boom faced its bust. POET Founder and CEO Jeff Broin was nervous about the downturn but still saw some opportunities ahead. “We were entering what would become the most challenging time in the history of the industry,” says Broin. Corn prices rose from $3.00 to more than $8.00 per bushel and several companies filed for bankruptcy. POET had just constructed and brought online six new 65 million gallon plants in Ohio and Indiana. These plants would now require additional financing at a time when banks were turning away from ethanol. “I was still somewhat optimistic because I know the power of ethanol,” says Broin. “We were somewhat prepared for the downturn in ‘07 and ‘08. We had seen it coming, so we were able to get creative quickly once it hit. During the next several years we used the downturn as an opportunity to optimize our current plants and technology as well as to create some new

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divisions for POET.” The Obama Administration and the Renewable Fuel Standard (RFS) also increased regulation of the industry during this timeframe. During a time Broin describes as “the longest period of slow growth since I’ve been in the industry,” POET was able to thrive by focusing on in-house expansion of capabilities, adding new efficiencies, increasing industry political and public relations involvement and planting the seeds for the future of cellulosic ethanol.

EFFICIENCIES AND EXPANSION: ‘We saw an opportunity and we acted on it.’ For POET President and Chief Operating Officer Jeff Lautt, 2 0 0 8 was a

turning point for the industry and a turning point for POET. After an era of external expansion – POET had been

building biorefineries at a rate of three or four per year – the company realized the nationwide capacity for ethanol production was nearing its saturation point. The previous construction boom would soon come to a screeching halt. The Blend Wall that caused the problem was created by existing laws, Environmental Protection Agency (EPA) regulations and American Society for Testing and Materials (ASTM) rules basically imposing a 10 percent maximum of ethanol in gasoline. Production capacity in the U.S. was now passing that number creating an oversupply. “We saw that coming, and we adjusted accordingly,” says Lautt. “We also saw that our company was growing, becoming more mature, more professional. We knew we could use this time to look inward and continue to improve, and that’s what we did over the next 10 years. While others were failing, we were investing in research, we were looking to the future. We even purchased a 90 million gallon per year ethanol plant in Cloverdale, IN during the downturn and brought it back online. The only expectations we had is that we could still do great things.” POET, then, focused on “debottlenecking,” a process designed to improve production at existing facilities. With so many new plants having come online in such a short period of time, people at POET Plant Management, like VP of Operations Neil Anderson, saw this as an ideal opportunity

POET Headquarters located in Sioux Falls, SD

to give those new biorefineries the chance to “mature.” “Operationally, we had time to bring the six new plants and Cloverdale into the family and to try some new things and determine where those things would work best for the company,” says Anderson. He speaks from personal experience as well, having worked five different jobs during his 10 years at POET. “I’ve been given opportunities to grow, and we’ve done the same with the plants. We were given the time to integrate all of this new production and to refocus on continuous improvement for each location. We identified locations where we could expand capacity in unique low cost ways, and we did that, too.” POET also focused on new hiring practices and top-tier training. In a few short years

from 2005 to 2010, POET nearly doubled their main office staff to 300 and multiplied the square footage of their Sioux Falls headquarters by six to a total of over 226,000 square feet, creating room for longer term growth. The industry slowdown did not curb POET’s relentless pursuit of research and development, which actually increased during the ten year period. “When I started with the company we were building three to four projects – from the ground up – per year,” says Jeff Heikes, Vice President of Engineering Project Management, POET Design and Construction. That was 2002. “When the industry build-up slowed in 2008, we made the decision to look internally to our biorefineries, at how we could make these

new plants more efficient and economical. That internal look led to a lot of big research projects that continue today.” There may not be a better example of this kind of internal project than the origins of POET’s corn oil extraction process. “It was one of those classic projects that define what we’re all about at POET,” says Dave Bushong, Vice President of Research. “In 2007 when we decided to look at corn oil, we found an old centrifuge sitting out in a biorefinery boneyard. We added some tanks and piping and had the corn oil extraction pilot process running in a couple of weeks. It moved from the benchtop to our biorefineries in a short period of time. We saw an opportunity and we acted on it.” Marketed as Voila, the highquality corn oil is used for

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everything from a feed additive for animals, to biodiesel production, to an industrial lubricant. “We went from producing zero to 550 million pounds of corn oil annually in the last 10 years, and we now have the highest yields in the industry,” says Bushong. “It’s just another example of the evolution of how we can get even more from the corn kernel.” In 2008, POET Nutrition, POET’s Distiller’s Dried Grains with Solubles (DDGS) and corn oil marketing division, was concentrating on continuing to find acceptance in new species of livestock and higher concentrations in feed rations, as well as developing new markets, for Dakota Gold, their branded high-quality source of livestock feed. Today, those products are not only accepted, but booming,

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says Greg Breukelman, President of POET Nutrition. “We went from trying to get people to understand what we offered to selling 9 billion pounds of our products all over the U.S. and into Asia, South America, Africa and the Middle East,” says Breukelman. “It’s just the beginning. We continue to develop new products from the corn plant. We feel like we are where the oil industry was 100 years ago when it comes to finding new uses for corn and coproducts.” POET Ethanol Products was also prospering during this same time period. “In 2008, we may have been looking inward,” says Bob Whiteman, Chief Financial Officer of POET Ethanol Products. POET Ethanol Products handles the marketing, management and distribution of ethanol, CO2 and

denaturant. “But we also said ‘Let’s go out there and see what we can do outside the company walls that we can bring inside as well.’ That’s been a decision that allowed for dramatic growth at our division.” In the mid-1990s when POET recognized the chance for largescale capture of carbon dioxide, a natural co-product of ethanol production, POET started testing the idea at a pilot plant in Scotland, SD. Today, a dozen POET plants supply the highest grade liquid carbon dioxide to customers across the U.S. for use in everything from fire suppression and flash freezing to beverage carbonation, managed and marketed by POET Ethanol Products. When they recognized the market for denaturant – the substance added to ethanol to

make it unfit for beverage use – POET Ethanol Products created a Denaturant Logistics Team and now is the largest supplier in the nation of high quality denaturant. When POET Ethanol Products saw an opportunity to improve their trucking process – a big part of the cost of selling and transporting that CO2 and denaturant, they invested in their own tractors and trailers. In 2015, their trucking company logged over 10 million miles and operated over 100 tractor trailers. “The team at Ethanol Products has done a remarkable job of learning and growing our business,” says Jeff Broin. “Their creativity during those tougher times during this ten year timeframe continues to pay dividends and shows their vitality and ability to grow a very successful business.” And, in 2013, when POET decided the time was right to consolidate grain buying and create common leadership across the company’s 27 biorefineries, they officially launched POET Grain in Wichita as well. That move – consolidating grain buying to one centralized location – required everything from implementing new accounting practices to revamping existing corn bidding methods to communicating these changes to a customer base of tens of thousands of grain producers and marketers. “You have to figure out your strengths and weaknesses to be able to take advantage of opportunities when they come knocking at your door,” says Dean Watson, President of POET Grain. “POET Grain started out of

a need. We have a model here, and we know if we can satisfy that need, other benefits may come from that. We’ve been doing that for a long time. It’s how the denaturant business was built, how the CO2 business was built, how our trucking business was built and how POET Grain has been built.” Almost immediately, the reorganization yielded positive results for POET – things like more efficient use of capital, utilization of specialized resources, greater market opportunity and diversified grain portfolio returns. Those involved with POET Grain have also seen something less tangible, but maybe more important – an increase in coordination and communication not only across the company, but also with their customers, the farmers. Today, POET Grain buys the 650 million bushels of grain, nearly 5% of the U.S. corn crop, necessary to produce those 1.7 billion gallons of ethanol per year. “POET Grain was the catalyst,” says Bob Casper, President of POET Ethanol Products. “At POET, when we see an opportunity to add value, the team comes together and makes it happen.”

INDUSTRY INVOLVEMENT: ‘We had to fight for our industry’ That “do it ourselves” attitude, while often focused on POET, carried over onto the national and international stage over this decade as well. In 2008 – with the recognition of the importance of the impending

Blend Wall and the realization that Big Oil would ramp up its anti-ethanol marketing campaign – POET began working with other industry leaders in an attempt to consolidate ethanol’s efforts and energy in the public and political arenas. “We felt the current organizations were not doing enough to get us beyond E10,” says Broin. Jeff Broin and Greg Breukelman produced a video and a business plan and set out on a historic venture to unite the Ethanol Promotion and Information Council (EPIC), the American Coalition of Ethanol (ACE) and the Renewable Fuels Association (RFA). In the end, only EPIC agreed to consolidate into an exciting new organization with the right funding and expertise to become the voice of the industry. POET, along with several other ethanol producers, formed Growth Energy in November 2008. From the start, the newfound organization was much more than a trade association. Just 30 days after its founding, the new members of Growth Energy – chaired by Broin – finished crafting the Growth Energy Green Jobs Waiver, which petitioned the EPA to increase the amount of ethanol in the fuel supply to 15 percent. “We sat right here in the Sioux Falls offices and wrote the waiver,” says Broin. “We were still working on it eight years and tens of millions of dollars later when the EPA’s Renewable Volume Obligation (RVO) numbers brought that wall down permanently in late 2015.”

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While it started with just 11 members, Growth Energy today consists of 80 plant members and 100 associate members and has become the largest organization representing – and championing – the ethanol industry. It was a long, painful process – the fighting back of every lawsuit brought by the oil lobby and every regulatory hurdle imposed by the EPA, some that still continue – but significant progress was being made. By late 2016, E15 was selling at nearly 400 stations in the biggest cities in America. Within the next few years, an estimated 700 stations will soon offer 9,000 E15 pumps in the nation’s busiest markets. More than 95% of the pumps installed would be flex pumps capable of selling

any blend of ethanol. This rapid expansion of higher blends happened because of a program created by the new organization. Prime the Pump, an industrywide initiative created and administered by Growth Energy, raised more than $60 million from the industry to complement a $100 million grant from the U.S. Department of Agriculture. The money was used for direct grants to independent convenience store companies to convert stations for E15 and higher blends. While it took 30 years for E10 to shift from rural to urban areas, Broin and the Prime the Pump team believe we can do the same thing with E15 in ten years or less by starting in major markets. The plan’s early adopters – those hundreds of gas stations – have

seen a competitive advantage with higher income, lower pump prices and higher octane E15. “The Blend Wall was finally coming down,” said Broin. “POET definitely played a leadership role to drive the industry forward in many ways, including the E15 waiver. We realized that we needed to be leaders in not only technology but also in creating markets, the political arena and promoting the good news about ethanol.” By 2016, POET’s political presence, had grown from two in-house political team members in 2007 to seven and a new POET office in Washington, D.C. “Politics had become an ever increasing demand on our time,” says Broin. “I believe government is over-regulating better, cleaner

Project LIBERTY

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Project LIBERTY

biofuels due to the influence of Big Oil on our government. We know the kinds of breakthroughs we’re producing that can change the world in a very positive way. And we want Washington to understand the importance of this as well.”

PROJECT LIBERTY: ‘A revolution for agriculture’ Maybe no single project defines the past decade – and maybe the future – for POET like Project LIBERTY. POET began discussing cellulosic ethanol from corn cobs in 2000. Early research showed challenges in both harvesting and collection of biomass, as well as processing cellulose into ethanol. In 2006, the U.S. Department of Energy announced a grant program for up to $80 million

to build a facility. POET applied for and later received this grant to build Project LIBERTY, a 20 million gallon per year cellulose plant adjacent to the starch plant near Emmetsburg, IA. In 2008, POET built Project BELL, a pilot plant to research and prove the technology for LIBERTY. Articles around this timeframe derided cellulosic ethanol as a “fantasy fuel.” At this same time, POET began collecting significant quantities of biomass, starting with corn cobs and later transitioning to leaves, husks and cobs. “Learning to produce cellulosic ethanol was a daunting task, and we knew that before we even started,” says Dave Bushong, who was involved in the Scotland, SD, pilot plant from the start. “We ran BELL for a year and then shut

it down and completely retooled it. Like everything we do here, we had optimism, perseverance and determination, and there were plenty of times we needed all three.” The retooling proved successful in the pilot plant, and that technology was recreated on a much larger scale for Project LIBERTY. “We knew there was significant risk in scaling up the technology,” said Broin. “But I had tremendous faith in our team at POET to get the job done. On several occasions I have called Project LIBERTY POET’s ark.” The $300 million plant in Emmetsburg, IA, is turning corn cobs, leaves and husk into tanker trucks full of cellulosic ethanol as it gears up toward converting 285,000 tons of biomass into a projected 20 million gallons of

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ethanol annually. The project has been called “a revolution for agriculture” and “a technology that can change fuel production as we know it.” The joint venture of POET and Royal DSM (a Netherlands-based leader in yeast and enzyme technology) officially opened in September of 2014, and has already advanced agriculture in the region by allowing farmers to generate a new revenue stream from in-field residue, something never before practiced on a large scale. “Project LIBERTY is the single biggest project of the decade for POET,” says Rod Pierson, Senior Vice President and General Manager of POET Design and Construction. “It’s big in so many ways. It’s big in terms of research and development. It’s big in terms of money spent. It’s big in terms of collaboration within POET and outside POET. It’s big for the future of the industry.” Besides ethanol, Project LIBERTY produces biogas from an anaerobic digester and steam

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from a solid-fuel boiler to produce power to run its own processes and export energy that replaces 100% of the steam needs at the larger starch-based ethanol plant next door. “I believe that, in the future, every starch-based ethanol plant will have a cellulosic plant next to it,” says Jeff Broin. “Not just in the U.S., but around the world. Cellulosic material is everywhere. The U.S. wastes one billion tons of cellulose each year that could produce more than 80 billion gallons of clean burning ethanol. We’re good at seeing several years down the road. We have that vision. We saw the high price of corn coming several years before it did. We saw the blend wall coming years before it hit. And we can see the explosion coming for cellulosic ethanol.” For Jeff Heikes, the POET experience seems like an adventure. “Being a part of POET feels like being a part of Lewis and Clark coming across the Great Plains,” says Heikes. “You’re excited because you don’t even know what you’re going to get into. Every day it seems like we’re moving forward and blazing new trails.” POET has come a long way since that day in the early 1980s when, according to family lore, Jeff’s dad Lowell Broin used a pressure cooker on the kitchen stove to test the principles of manufacturing ethanol. What started on that Wanamingo, MN farm has led Jeff and Tammie Broin and their family from

Scotland to Sioux Falls to subSaharan Africa, where POET created Mission Greenfield, a project designed to improve agricultural yields in Kenya and beyond. In between, Broin stepped down from CEO to Executive Chairman for a short period to focus on philanthropic efforts, then returned to the company he started with a renewed interest and a bigger-picture outlook. One thing that hasn’t changed is Broin’s optimism. For all of the projects over POET’s past decade, for all of the technological breakthroughs, for all of the agricultural advancements, Jeff Broin points to the one constant that has kept the company successful – the people of POET. “I have this kind of optimism for the industry because we have the best people you’ll find anywhere, and we have shown we can accomplish anything with great people,” he says. It’s the kind of corporate camaraderie that has defined POET since the start, and continues to carry them forward into the future. “We’ve got a product that’s better for your car, cheaper for your wallet and cleaner for your air,” says Broin. “We’re part of an industry that is critical for the future of our nation and our world and we combine that with people that truly want to make a difference. We can see down the road and we know that, in five years, in ten years, we’ll be changing the world in even bigger and better ways.”

NASCAR UPDATE submitted by Ryan Welsh, Director of Sales and Marketing for American Ethanol

10 MILLION REASONS I came across a 2008 research paper that studied the early life critical parts failures in NASCAR vehicles. Do not ask why or how, it just happened. It was a study on the reliability of the parts that make up cars both on and off the NASCAR track. To sum it up, it concluded that our manufactured cars we drive on the road have a less than 1% early life critical parts failure. Meaning they have a 99% reliability rate of stuff not breaking in the early life of the vehicle. NASCAR cars, on the other hand, have almost a 10% early life critical parts failure. That puzzled me at first because of the expense per part in a NASCAR race car, which I know is high, and the expertise of the engineers who put these cars together.

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But after reading the rest of the study it was very evident. The 10% critical parts failure rate may be attributable to one clear factor. Under normal driving circumstances, NASCAR vehicles would demonstrate the same reliability of less than 1% critical parts failure as commercially produced vehicles do, were it not for the fact that in an effort to increase horsepower and speed, critical parts in NASCAR vehicles are pushed to their tolerance limits throughout the race and can be expected to fail at higher rates. NASCAR races are driven at far from normal driving circumstances. We are talking extreme conditions. NASCAR normal is four hours at an RPM north of 8000 for the engine and at speeds above 200 MPH. Every part of the car is

pushed to its limit. Six years ago, NASCAR entered into a groundbreaking partnership with Sunoco and American Ethanol, launching its long-term biofuels program to reduce emissions across its three national series. After an exhaustive analysis, Sunoco formulated Sunoco Green E15 to allow for a seamless transition, and the biofuel made its debut at Daytona International Speedway in 2011. We were off to the races. Since then NASCAR has surpassed 10 million competition miles on Sunoco Green E15, a biofuel blended with 15 percent American-made ethanol. The 10 million miles were accumulated across practice, qualifying and racing laps since the biofuel was adopted by the sport. That would be the equivalent of you running The Cannonball Run (a car race from New York City to Los Angeles made famous by a movie with Burt Reynolds, Farrah Fawcett and Dom DeLuise) every day for almost 10 years. Plan on averaging over 116 miles per hour to make it in a day, too.

Since American Ethanol began its partnership with NASCAR not one single failure has occurred in relation to the fuel change. American Ethanol has performed flawlessly. Our partnership began a couple years after this parts failure study I referred to but it is safe to say our reliability rate is 100%. “It’s evident that the renewable, higher ethanol blended fuel performs flawlessly against our rigorous racing conditions,” said Brent Dewar, NASCAR Chief Operating Officer. “This remarkable milestone is the result of an industry-wide commitment to demonstrate high performance

racing with reduced emissions, while educating our fans about the benefits of sustainable and renewable American ethanol.” Since transitioning to the biofuel, NASCAR has helped validate the fuel’s qualities in front of an audience of millions of NASCAR fans and is helping shift attitudes and behaviors around the use of ethanol. According to new research conducted in July, when compared to non-fans, NASCAR fans are more likely to support the use of ethanol blended gasoline to fuel NASCAR race cars, their own car, and cars on the road today to increase U.S. energy independence. Source: Custom Environment-Related Tracker commissioned by NASCAR and conducted by Toluna (July 2016). American Ethanol’s performance and sustainability are a couple of good reasons why NASCAR chose this biofuel. “We are thrilled to reach this important milestone with NASCAR and to be a part of the effort to reduce the sport’s impact on the environment with Sunoco Green E15, while increasing horsepower and standing up to the most demanding conditions on the track,” said Emily Skor, CEO of Growth Energy. “Like their favorite NASCAR drivers, consumers are now utilizing a fuel with a blend of 15 percent ethanol. Americans have already driven over 500 million miles on E15. Today, nearly 400 stations across 28 states sell E15 and those numbers continue to climb. Consumer demand is on the rise because Americans are finding out that E15 is the right choice for their engines, their wallets and the environment.” Odometers powered by E15 are reaching unprecedented numbers and we are starting to see a movement. A movement for consumer choice. As more stations offer E15 more consumers are choosing to try it. They are making their own decision based on their own reasoning. Isn’t that what America is about? Our opponents try very hard to plant reasons why ethanol is a bad choice to try. They use a few scare tactics like saying it is bad for your engine. Our supporters like NASCAR whose livelihood depends on performance say otherwise and they count the reasons why American Ethanol is a good choice, they’ve counted 10 million of them so far.

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The

GODFATHER of

ETHANOL If you work hard, anything is possible. That’s the American credo. by Janna Farley

No one, perhaps, embodied that philosophy more than Bill Holmberg, a true American patriot, environmentalist and tireless supporter of ethanol. Holmberg, a retired Marine Corps lieutenant colonel who received the Navy Cross for his actions on a Korean battlefield and later spent decades as an advocate on Capitol Hill for renewable energy and environmental causes, died Sept. 8, 2016 at a hospital in Palm City, FL, after a several-year fight with cancer. He was 88. His legacy, however, continues, thanks to his years of military service and work that paved the way for POET and the entire ethanol industry.

COMMITTED TO THE COUNTRY A strapping 6-foot-4, Col. Holmberg signed up for the Marines at 15, lying about his age to serve in World War II. He went through boot camp and was about to go to the Pacific when he was found out and sent home. He later reenlisted and graduated from the U.S. Naval Academy in Annapolis in 1951. The next year, Holmberg was leading a rifle platoon during the Korean War when he embarked on a mission deep in enemyheld territory for which he was awarded a Navy Cross, the service’s highest decoration for valor after the Medal of Honor. Col. Holmberg, then a second lieutenant, engaged “in a fierce

hand-to-hand battle while under an intense concentration of hostile mortar, machine-gun and small-arms fire,” the citation accompanying the medal read. “Although severely wounded during the engagement, he refused to be evacuated

and, while receiving first aid, continued to issue orders and to direct the offensive operations of his unit.” “He was a patriot,” says Dave Hallberg, a close friend of Holmberg’s and founder and first President and CEO of the Renewable Fuels Association. “He bled on foreign battlefields for all of us.” Once back home, the memories of the waste and devastation of war brought out a renewed sensitivity in Holmberg to protect the planet. “He came back determined that our country wouldn’t be dependent on foreign oil,” Hallberg says.

alternative energy source. “Yes, my father was a treehugger – perhaps the toughest one ever,” his son Mark Holmberg, a Virginia newspaper columnist, wrote in the Richmond Times-Dispatch. “He believed with every fiber of his being that integrated, sustainable agricultural/energy systems are crucial to the economic and physical health of this nation and the world.” The more Holmberg learned about ethanol, the more he was convinced that the United States needed an alternative energy program. When the Department of Energy was created in 1978, he was one of the first who jumped on board. He ran the Citizens

COMMITTED TO THE ENVIRONMENT After his military retirement in 1970, Holmberg joined the Environmental Protection Agency (EPA). During the 1973 oil embargo, the EPA sent H o l m b e r g , among others, to set up the Federal Energy Office that would be responsible for allocating fuel to the states. After the energy crisis ended, Holmberg returned to the EPA, which put him in charge of the Operations Division in the Office of Pesticide Programs. There, Holmberg discovered the concept of ethanol, and that’s when he began championing ethanol as a sustainable,

Participation Division, because he wanted to have the authority to get people involved in the production of energy, including ethanol.

“He was pushing biofuels back in the early ’70s before anyone else even came into the industry and considered pushing renewable energy in Washington,” says Jeff Broin, POET Founder and CEO. “Bill was always 20 years ahead of everyone else. He was a true visionary.” Not everyone agreed with Holmberg’s vision. In the 1970s, the push back to a clean energy vision was harsh. The industry wasn’t developed yet, and the idea of large wind farms, integrated biorefineries and hydropower installations resulted in ridicule from many policymakers, reporters and planners. “He was definitely one of the early pioneers that promoted ethanol within the beltway of D.C.,” says Dave Vander Griend, President and CEO of ICM, Inc., a Kansas company focused on sustaining agriculture t h r o u g h innovation by engineering, building and supporting the renewable fuel industry. “He was the lone voice out there back then.” But Holmberg wasn’t deterred. He worked tirelessly on behalf of the cause he truly believed in and spent an inordinate amount of time organizing, traveling the country and working with environmental advocates, entrepreneurs, sustainable farmers and land

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use planners, and in the national organizations in Washington, D.C. “He cared about rebuilding rural America,” Hallberg says. “He cared about the soil. He was an environmentalist who was way ahead of his time.”

ANYTHING IS POSSIBLE Holmberg’s excitement for his work was contagious. “He made me believe that anything is possible,” says Larry Pearce, Executive Director of the Governors’ Biofuels Coalition. His passion was obvious. “Bill always had a great attitude and a smile, but was also always very inquisitive in putting out

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ideas on how to move the industry forward,” Broin says. And he wasn’t afraid to do things a little differently to get a little attention, like in 1979 when he set up an entire portfolio of how clean, renewable energy would work in an actual mock community set up on The Mall in Washington, D.C. Or, when he and other ethanol advocates made a splash on the Potomac in 1993. “One of my fondest memories comes from when we rode a biodieselpowered ship across the Potomac to the presidential balls on the opposite side during Bill Clinton’s first inaugural event,” Broin says. While designed to get attention, these activities weren’t merely publicity stunts. Holmberg truly believed in what he was doing. “He was a dyed-in-the-wool American, made-in-America kind of guy,” Vander Griend says. “He lived and breathed renewable fuels. He was out there, always checking out what the opportunities were.” Holmberg’s work didn’t go unnoticed. In 2001, Sen. Tom Daschle, then Majority Leader, praised Col. Holmberg in the Congressional Record not only as “a war hero but an indefatigable champion of the environment.” In 2002, Holmberg received

the Department of Energy’s (DOE) Biomass Energy Program Distinguished Service Award. After retiring from the DOE, he served as an aide on Capitol Hill, working for Sen. Ben Nelson of Nebraska, and managing associations promoting solar and wind energy initiatives. Holmberg was a founding member of the Sustainable Energy Coalition, which makes major contributions to the Senate and House Renewable and Energy Efficiency Caucus. In 2002, he became chairman of the Biomass Coordinating Council of the American Council on Renewable Energy and remained as a coordinator of the organization’s biomass efforts until his death.

ALWAYS WORKING Holmberg continued fighting for ethanol and the environment long after most people would have retired. “Bill Homberg was probably one of the greatest bulworths of the ethanol industry,” Hallberg says. “He understood the power of technology – how farmers, engineers, scientists and companies like POET could be competitive and make renewable fuels and high-octane fuels part of the system.” He never gave up. And because of that, Holmberg’s legacy lives on. “I knew Bill well and know he was a tireless advocate for our industry. … We owe Bill a great debt of gratitude,” Broin says. “Without his early investment in getting our government behind ethanol, it is doubtful that any of us would be here at POET today.”

RENEW

CHANCELLOR Thanksgiving FOOD DRIVE POET Biorefining − Chancellor hosted their Annual Thanksgiving Food Drive. Team members collected items for the Turner County Food Pantry. This year’s drive was focused on personal hygiene items such as soap, toothpaste, tooth brushes, deodorant, shaving items, etc. As a reward for bringing in items, team members were served a pancake brunch. This year’s drive collected 238 items.

POET NUTRITION DONATES TO A FAMILY IN NEED AT THE St. Francis House The St. Francis House is an emergency shelter for the homeless in Sioux Falls, SD. They offer a warm bed, showers, laundry, food and special services for reaching long-term goals of employment, independent housing and addiction recovery. The families at the St. Francis House are given a place to live for up to a year and during that time, they must show that they are employed or prove that they are trying. Once they are employed, they must make regular deposits into a bank account so they will have money to get their own place. POET Nutrition “adopted” a family of 6 for the holidays, purchasing a variety of essentials items and Christmas gifts for each of the 4 boys. To collect all the supplies, the POET Nutrition employees were divided into 8 teams with each team consisting of 6-7 people and given a reindeer name. A generous and competitive Christmas spirit had teammates competing to help fulfill the needs and wishes of the family.

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RENEW

A BUSY CHRISTMAS IN The POET Biorefining â&#x20AC;&#x201C; Glenville team has been busy this Christmas collecting 6,000 pounds of food for the annual food drive and packaged 500+ full Christmas meals for local families in need through the Freeborn County Salvation Army. The team also helped distribute many toys and the pre-package meals to families in the community. Additionally, the Glenville team purchased, wrapped and delivered gifts for 45 people as part of their Ethanol Cares program. Pat Mook, retired accountant and Cindy Oldfather, controller (both pictured), spent countless hours reaching out to contacts to find people in need, shopping, wrapping and delivering the gifts. The Ethanol Cares program is entirely funded by donations from the employees at POET Biorefining â&#x20AC;&#x201C; Glenville and its members.

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Glenville

THE PACKAGE HAS arrived In recognition of the many military personnel who are serving overseas, POET Biorefining − Lake Crystal chose to put together a package to be sent to a group of local soldiers stationed in Afghanistan. “Our military personnel have endlessly, day in and day out, put their lives on the line for our freedom. We wanted to send a small thank you for their dedication and perseverance.” Jim Lambert – General Manager. The soldier 3rd from the left is Dennis Hanson, son of Lake Crystal team member Randy Hanson.

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WATCH ME

GROW

Fifth graders from Corning, IA get a taste of what it is like to be a farmer and how ethanol plays a role in the ag industry. by Janna Farley

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Despite growing up in a small, rural Iowa community, 10-yearold Owen Paul doesn’t come from a farm family. He’s never seen first-hand the daily work required to run a farm. He hasn’t spent hours riding on a tractor with his dad or grandpa. He really hasn’t had much exposure to the realities of ag life at all. “We live in the country, and we always grow a good garden,” says Travis Paul, Owen’s dad. “But we’re not farmers.” But thanks to an innovative community outreach program developed by POET Biorefining – Corning, Owen – and his fifth grade classmates at Corning Elementary – got a taste of what it would be like to be a farmer and how ethanol is transforming the ag industry. Owen was part of the first class of Corning students to participate in POET’s Watch Me Grow program. The Watch Me Grow program was developed by Greg Olsen, General Manger at POET Biorefining – Corning, and his team as a community outreach initiative. Despite being a part of the Corning community since 2007, Olsen said many people don’t know POET’s story. “Although we stay actively involved in the community, many people don’t really know what POET is and what we do,” Olsen says. The Corning team could have held an open house or had its employees speak at community

events, but they wanted to do something a little outside the box – “something that would make a lasting impact,” Olsen says. And they wanted to have fun, too. That’s when they decided to combine community outreach with an educational program for elementary-age students. “We wanted to get them involved in something that was not only fun and educational, but would also help us get into homes with our message,” Olsen says. The program kicked off at the beginning of May 2016, with 31 then-fourth grade students. Planting had to be postponed once due to wet conditions – something all farmers can relate to – but the students were nonetheless enthusiastic about the job. POET prepared the field, but each student was responsible for planting 12 or 13 seeds in his or her row, marked with a plastic name tag. It was dirty, hard work, but the kids didn’t mind. “They had a great time planting corn,” Olsen says. Then, it was a waiting game. Being patient, of course, can be harder than the actual physical work – especially for a kid. To make sure the excitement for the Watch Me Grow program didn’t fade, POET mailed each student a newsletter every two weeks. The newsletters were designed to be fun, with games and activities for the kids and lots of information about agriculture and ethanol that they could share

with their parents. The mailings also included some sort of small gift – like a rain gauge or a POET hat – that tied into the theme of that newsletter. Mostly, though, POET wanted a way to share updates on the corn they planted since the kids wouldn’t be able to see it grow during the summer months. The June 7 newsletter, sent to kids about a month after they planted their seeds, was exciting: “Your corn plants have emerged! That means the plants have come up out of the ground and are searching for sunlight.” But the news wasn’t always good. The July 6 note, for example, let the kids know that their corn was growing, but not as fast as the corn in most professional farmers’ fields: “Our ground was pretty wet when we planted and, as a result, your corn suffered a little. We’ve added a little fertilizer and sprayed for

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weeds, so it’s coming along, but not quite as fast as we expected. We learned an important lesson: You must properly prepare your soil, fertilize just at the right time and assure your soil has the proper drainage in order for it to reach its fullest potential.” “We wanted to be realistic. We didn’t sugarcoat it,” Olsen says. “This is real life.” By the Sept. 14 newsletter, though, the corn was doing well and in its final stages: “You’ll also notice your corn plants are

52 vital || THE ESSENTIAL PERSPECTIVE

starting to turn brown, mostly from the bottom up. Corn is unique in this process. It’s pulled as much moisture and nutrients from the soil as it can and has been rushing it to the corn kernels so each kernel can develop as best as it can. The plant is no longer concerned about itself, but only about the kernel. In fact, the corn plant actually sacrifices itself for the good of the kernel. Think about that for a minute…” The newsletters were wellreceived, Olsen says. “We started to hear a lot of talk around town about how much excitement this project was spurring.” No one was more excited than the kids, says Travis Paul. The newsletters were highly anticipated. “Owen loved the newsletters and we always sat down to read them together,” Paul says. “He was always excited to see what was happening with the corn. It was nice to be able to keep an eye on the corn without going out there.” In October, the corn was finally ready to be harvested, and POET invited the students and their families back to the plant to get a first-hand look at how much the corn had grown and to celebrate. But first, the kids had some work to do. After all, the job of a farmer is not complete until the corn is in. “We had the kids harvest the corn by hand – we just had them pull off whatever ears they could,” Olsen says. To complete the exercise, the kids sold their corn to POET’s Grain Buyer. Each

student received $3.10 – the value of a bushel of corn. After the harvest, the kids and their families got a tour of the plant. They were able to see everything from a truck coming in to dump a load of grain and the automated control room to the high-tech lab. One of the tour highlights was the ethanol burn, Olsen says. The chemist in the lab took two small beakers and filled one with gasoline and the other with ethanol. When the gasoline burned, it left soot all over the glass beaker. The ethanol, on the other hand, burned clean. “It’s so dramatic and so easy to demonstrate,” Olsen says. “They could easily see how much cleaner ethanol is – the kids couldn’t stop talking about it.” Hands-on learning like this is so important for kids this age, says Corning fifth grade teacher Allison Thomas says. “Because we live in rural Iowa, most people would think that kids here know everything about farming and agriculture. But that’s not necessarily true anymore. To be out there picking their own corn, these kids really got a sense of what it is like to be a farmer,” Thomas says. “They couldn’t stop asking questions during the tour, either. The kids had the best questions. It really helped them understand the entire agriculture process and the ethanol industry.” The tour was eye-opening for parents, too. “I had no idea how many products could be derived from

corn. I knew about the animal feed, but there are all these other uses for corn, too. That amazed both of us,” Travis Paul says. Though the program was initiated by POET Biorefining – Corning, it evolved into a true community effort, Olsen says. Farm Bureau Financial Services, Crop Production Services and Adams County Farm Bureau also got involved, helping provide

expertise and materials to the outreach project. “Pulling in members of the community was a key part of making this a successful program,” Olsen says. “We didn’t want it to seem like an advertisement for POET. It was about more than just ethanol. It was about the value of the American farmer.” While not an immediate objective of the Watch Me Grow program, the activities also helped introduced the fifth graders to different career options, Thomas says. While POET is certainly based around agriculture, the plant also needs professionals like chemists and engineers. Students can live in the Corning area and still pursue a career in these fields. “Opportunities for jobs in those areas exist here, too,” Thomas says. While the Corning fifth graders won’t have to think about their future careers for a while, they won’t soon forget what they learned in the Watch Me Grow

program. “We’ve planted the seed,” says Olsen, who is already working with his team to plan next year’s Watch Me Grow program. “As they grow through life, they will look at agriculture differently and look at ethanol differently – and they’re always going to remember how much fun they had.” Owen Paul does. The young farmer – if only for a summer – can’t stop talking about planting and harvesting his corn, Travis Paul says. “He really enjoyed the program. It was such an incredible experience. I’m glad he got to be a part of it.”

Owen Paul

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CONUNDRUM

ACROSS 1. Place for bubbles 5. Nimble 9. La ___ opera house 14. S-shaped curve 15. One of the states where POET

operates plants

16. Pointed at the top 17. Country dance 18. Flow stopper 19. Weight measure 20. Beneficial quality of POET’s

ethanol production process

23. Where the heart is 24. Many a time 25. Musical scale note 26. Explanations 28. Roll 31. Basil-based sauce 34. Handshake 35. Greeting at sea 36. Basis for a new energy generation

system being used by POET in 6

Ohio biorefineries

39. Pudding ingredient 40. Feline musical 41. Seeps 42. Stock advice 43. Plus 44. “She loves __, yeah yeah yeah”

The Beatles

45. Before, before 46. With tenderness 49. POET mantra 54. Emulate 55. They control oil supply 56. Open the pot 57. Gritty quality 58. Onion relative 59. ____ing, top limit 60. Hero’s exploits 61. Flounders 62. Scots’ language

FOR ANSWERS, VISIT vitalmagazineonline.com/answers

54 vital || THE ESSENTIAL PERSPECTIVE

DOWN

30. Colors

1. Doubled, a Pacific island

32. Decorative case

2. Insurance broker

33. Leak slowly

3. Choppers, so to speak

34. Wee biting insect

4. Reflecting instrument

35. Complete turn around

5. Mixer

37. More aloof

6. Ornamental flower

38. Parts of houses and mouths

7. Knee-slapper

43. Totals

8. Berra who said “a nickel ain’t

44. Fox hunters cry

45. Remove

worth a dime anymore”

31. “Over here!”

9. Shows derision

46. Be in control

10. Queen’s entourage

47. Eye make-up

11. Actress, Archer

48. Himalayan inhabitants

12. Itchy dog’s woe

49. Longest river

13. High card in Hold’em

50. Outback birds

21. Dust mover

51. Undivided

22. Beaver-like rodent

52. Takeoff artist

26. Outrage

53. Strike out in editing

27. Theater successes

54. Auto efficiency measurement

28. Phenom 29. Top-rated