The first ethanol pipeline:
Biofuels Coming to a Pipeline Near You
on 17 October 2008, 13:38
by Justin Moresco
Despite years of foot-dragging and nay-saying among the U.S. oil establishment, ethanol looks ready to start oozing via the country’s vast network of oil pipelines.
It’s a development long desired by biofuels startups and their backers, who would like to see alternative fuels eventually replace conventional gasoline as the primary fuel.
Kinder Morgan Energy Partners, which owns or operates 25,000 miles of pipelines and 165 large storage facilities, announced that it would begin shipping ethanol in mid-November through a 106-mile, Tampa-to-Orlando, Florida, gasoline pipeline.
The move would mark the first U.S. oil pipeline operator to transport ethanol and could spur competitors to follow suit.
“We’ve identified public access to biofuels as one of the critical challenges in the biofuels industry, and moves like this will accelerate the public availability of these fuels,” said Matt Horton, principal with venture firm @Ventures, which backs several biofuels startups.
“Looking beyond the first generation of ethanol technology, a big issue for second generation [startups] is to be able to cost effectively get their product to consumers,” he said, referring to startups working to commercialize fuels made from non-food sources, like fast-growing grasses and industrial byproducts.
In the U.S. today, ethanol is distributed by rail from production plants to large storage facilities, called terminals. Ethanol industry advocates have been pushing for the fuel to be shipped to terminals via pipelines, like gasoline, increasing availability and reducing costs.
The Association of Oil Pipelines says that a modest-sized pipeline can carry as much fuel per day as a 75-car train of tank cars carrying 2,000 barrels each.
Some large oil companies have been accused of casting doubt on the ability to use pipelines to move ethanol in an effort to slow its widespread adoption. Still, ethanol is highly corrosive when mixed with oxygen and can cause damage to lines and fittings. It also is hydrophilic, meaning it attracts water, creating a sub-octane gasoline.
Kinder Morgan’s announcement indicates that at least one major pipeline operator believes it is commercially viable to transport biofuels in its network. The Houston company spent $3.5 million modifying its Florida pipeline to accommodate ethanol and is considering doing the same on other pipelines. It also is evaluating shipping biodiesel in Mississippi, South Carolina, and Oregon.
“We are pursing pipeline solutions to the overall supply chain for biofuels,” said Tom Bannigan, Kinder Morgan products president, in a statement.
But Kinder Morgan is not alone in moving to embrace biofuels. Tulsa, Oklahoma’s Magellan Midstream Partners and Buckeye Partners out of Breinigsville, Pensylvania, are exploring building a $3 billion, 1,700-mile pipeline dedicated to transporting ethanol between the Midwest and Northeast. It would supply more than 10 million gallons of ethanol per day and take “several years to complete.”
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