Renewable Energy Technology Assessments - Kauai Island Utility ...

Kaua’i Island Utility Cooperative
Renewable Energy Technology Assessments
3.0 Renewable Energy Technology
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increase the market potential for ethanol. Ethanol is already used in place of MBTE in
many Midwestern states.
Environmental Impacts
Ethanol is a renewable, environmentally friendly fuel that is inherently cleaner
than gasoline. Using ethanol reduces emissions of carbon monoxide, particulate matter,
oxides of nitrogen, and other ozone-forming pollutants. Ethanol blended fuel can reduce
carbon monoxide emissions by as much as 25 percent and greenhouse gas emissions by
as much as 35-45 percent. 15
While the actual energy balance of ethanol was debated for several years, recently
released results from a USDA study indicate that corn ethanol yields 67 percent more
energy than what is required to produce it. 16 It is further noted that the fossil fuels used
in the process of producing ethanol are usually of domestic origin (coal and natural gas),
rather than imported fuels. While the USDA’s study focused specifically on ethanol
produced from corn, it is likely that ethanol production from other feedstocks can yield
similar results.
Kauai Outlook
The overall prospects for ethanol in Hawaii are good, particularly for the
transportation sector. The state of Hawaii has already implemented a variety of ethanol
incentives and is likely to implement further incentives and requirements in the near
future. In 2000, Hawaii signed into law an ethanol production incentive providing
ethanol producers with a tax credit equivalent to 30 cents per gallon for up to ten years.
Further, the state currently provides an exemption from the state’s 4 percent excise tax on
retail sales for fuels that are at least 10 percent biomass-derived alcohol by volume. In
addition to the numerous direct financial incentives from the state for using and
producing ethanol, ethanol would directly displace imported petroleum products
providing greater resource independence for Kauai.
On Kauai, Gay & Robinson has expressed serious interest in building a 15 million
gallon per year ethanol production facility provided the state moves forward with its
proposed ethanol content requirement. Ethanol can be relatively easily produced from
raw sugar and molasses, or directly from the juices of crushed cane. Gay & Robinson is
also investigating the possibility of producing ethanol from excess bagasse. It might be
advantageous for KIUC and Gay & Robinson to jointly explore an integrated ethanol
15 American Coalition for Ethanol, “Environmental and Clean Air Benefits,” available at
http://www.ethanol.org/environment.html, accessed 2 August 2004.
16 United States Department of Agriculture, “Net Energy Balance for Corn Ethanol,” available at
http://www.bioproducts-bioenergy.gov/pdfs/net%20energy%20balance.pdf, accessed 4 August 2004.
21 March 2005 3-25 Black & Veatch