Delivering Sustainable Biomass Solutions...2013/06/17 · Energy Crops Biomass Feedstocks Genera spans the gap between upstream landowners and downstream biomass technology providers

Delivering Sustainable Biomass Solutions

Creating an Acceptable Supply of Biomass Feedstock to Satisfy Financing Requirements June 17, 2013

Copyright 2013, Genera Energy Inc.

What We Do

Land Owners & Farmers

Long-term land leases & easements

Biomass crop services: establish, manage, harvest,

collect, store, transport

Long-term biomass feedstock supply contract

On-time, sustainable delivery of high quality

biomass feedstock

Biomass Consumers

(primarily technology &

project developers)

Energy Crops

Biomass Feedstocks

Genera spans the gap between upstream landowners and downstream biomass technology

providers and project owners, to sustainably and reliably produce energy crops and add value

by tailoring the supply chain to meet the uniform industrial biomass feedstock supply

requirements of biomass processes. 2


Genera Energy Inc

• Delivers integrated biomass supply chain solutions to fill the need for consistent, sustainable, cost-effective, high quality renewable biomass feedstock

• No substitute for ag sector roots and experience

• Without it, others claiming to have integrated feedstock supply solutions don’t know what they don’t know

• Competitive advantages in proprietary biomass feedstock supply strategies and novel IP

• Genera is the only company in the Biofuels Digest Top 100 list dedicated to delivering fully integrated biomass supply chain solutions

Genera is a supplier of sustainable biomass feedstocks, delivering integrated biomass supply chain solutions that satisfy upstream and downstream needs of the

biofuels, biochemical, and biopower industries

3


The Feedstock Problem Solved

• Long-term biomass supply

• Demonstrated experience

• Integrated solution • Long-term (10+ year)

supply agreements

Solving the Feedstock Problem requires de-risked, scalable biomass feedstock solutions

providing timely delivery of a sustainably produced, consistent, uniform industrial feedstock

that meets the needs of the biomass conversion process customer at an affordable price.

CONFIDENTIAL

Sustainable

Low Transaction

Costs

Uniform

Scalable

Affordable

De-Risked

• < $60/delivered ton • (< $0.70/gallon) • Minimal volatility

• Non-food acreage • + Life cycle energy

balance • Reduces GHG • Multiple uses

• Timely delivery • Industrial standards • < 1% non-conforming

• Minimize number of contracting parties

• Uniformity among contracts

• Replicable model • Diverse portfolio

A Bankable Feedstock

Supply Solution

4


• Corn Stover

• Sugarcane Bagasse

• Grain, sweet & high biomass sorghum

• Multiple switchgrass varieties

• Miscanthus

• Mixed grasses

• Arundo donax

• Hybrid poplar

• Cottonwood

• Aspen

Annual Energy Crops

Ag Residues

Perennial Switch-

grass

Other Perennial

Crops

Short Rotation

Trees

Advantaged Feedstock Supply Chain Solution

Land Acquisition Transportation

Seed Procurement

Crop Establishment

Crop Production

& Maintenance Harvesting & Collection

Aggregation & Storage

Pre-Processing

Delivery

Proprietary GIS-based feedstock supply & cost

model

Proprietary Energy Grange model for accumulating & controlling land

Preferred pricing & supply agreements with major energy crop biotech &

supply companies Potential for proprietary equipment

Proprietary conveyance &

handling system

Genera has developed unique feedstock supply strategies that address sourcing of affordable,

high-quality, sufficient quantity of feedstock, drawing on Genera’s deep roots in agriculture and

extensive experience.

CONFIDENTIAL

Broad portfolio of feedstock

experience

Feedstock Plans & Modeling

5


Marketplace Feedstock Needs

• Sustainable biomass feedstock supply ‒ Year round supply of substantial quantities

‒ Predictable price that supports project economics

‒ High quality, consistent product

‒ Positive environmental benefits

• Maximize feedstock value

‒ Long term supply commitment

‒ Integrated upstream solution

‒ Continuous improvement and innovation

• Minimize feedstock risk

‒ Portfolio of biomass feedstocks (annuals & perennials)

‒ Proven track record

‒ Feedstock supply commitment consistent with project timeline

‒ Credit worthy supplier

6


Driving Forward

• Land availability

• Grower involvement

• Financing

• Production Costs

• Continuous Improvement

• Density

• Access

• Scale

• Multi-feedstock

• Natural variability

• Alternative markets

Production Capacity

Economics Logistics Manageable

Risk

7


• Land availability – Current use

– Competitive uses

– Grower attitudes and participation

• Land productivity – Soil types

– Precipitation

– Crop adaptation

Production Capacity

8


• Production of energy crops require:

– Economic benefit

– Long-term consistency in income through bankable contracts

– Low cost or assisted cost establishment

– Risk management tools

– Technical assistance

• Grower contracts should:

– Be backed by a bankable entity

– Provide adequate economic return w/adjustments

– Be of long duration (5, 10 yrs or longer)

– Share risk among partners

– Provide sources of technical assistance

• Contracts will take different forms, from full supply services to simple land leases

Grower Decision Drivers

9


• All land is available….for a price!

• Factors influencing land availability:

– Productivity of the soil

– Competing uses

– Logistical access

• Selecting land to produce biomass for a facility requires optimization of multiple factors

Land Availability and Access

10


Production Economics

• Drivers of cost include – Land cost and availability

– Feedstock(s) selection

– Supply system (just-in-time vs. stored material)

– Package requirements

– Transport

– Pre-processing

All drive to the least-cost feedstock solution!

11


• Key factors: – Feedstock type/mix

– Land rent

– Establishment cost • Seeded establishment costs

are significantly less than that of vegetative propagation

– Management of inputs

– Yield • A ½ ton per acre increase in

yield has the same impact as a 5 gallon increase in conversion efficiency

– Transportation • Maximum load densities and

short hauls are important

Feedstock Production Costs

12


• Logistical systems are significant cost components to biomass supply chains

• Feedstock composition & quality can also be significantly impacted by proper logistics, storage and handling of material

• Feedstock logistics revolve around:

– Bulk density

– Moisture control

– Storage and handling

– Access

Biomass Logistics

13


• Storage and Handling:

– Quality control • Moisture!!

• Dry matter loss

• Loss of composition components

– Storage footprint • Large areas required

• Transportation

– Bulk density • Achieve maximum axle

weights

• Reduce handling costs

• Densification

– Access to biomass in field or in storage

• Ingress and egress of trucks

• All-weather access

Logistical System Impacts

14


• Land acquisition

– Real grounded information is key (e.g., focus groups)

– Integrated, long-term land control

• Achieving projected crop yields

– Weather impacts

– Management consistency

• Inventory risk

– Storage degradation

– Fire, other catastrophic events

• Things beyond our control

– Commodity price swings

– Oil costs

– Policy changes

Managing Risk

15


• Crop insurance

– Expand traditional yield-based risk management programs

• BCAP and similar programs

– Overcome high upfront costs for producers

• Loan guarantee programs tailored to feedstock supply chains

• State-based incentives/programs

• Alternative biomass markets

• Feedstock diversity

– Multiple feedstocks mitigate risks associated with:

• Land recruitment

• Climatic impacts on yield

• Storage costs

Risk Reduction

16


Driving Forward

• Land availability

• Grower involvement

• Financing

• Production Costs

• Continuous Improvement

• Density

• Access

• Scale

• Multi-feedstock

• Natural variability

• Alternative markets

Production Capacity

Economics Logistics Manageable

Risk

Integration across the supply chain is critical!

17

Genera Energy Inc. 167 Tellico Port Road

Vonore, TN 37885

423.884.4110 – Phone

423.884.4129 – Fax

www.generaenergy.com

Sam Jackson

Vice President, Feedstock Development and Supply

Documents

Delivering Sustainable Biomass Solutions...2013/06/17 · Energy Crops Biomass Feedstocks Genera spans the gap between upstream landowners and downstream biomass technology providers