AIADA Newsletter Friday April 20, 2007

Ethanol Is Not The Only Green In Town Some believe we are heading down the wrong path when it comes to America's fuel policy, reports BusinessWeek.com. Amyris Biotechnologies in Emeryville, Calif a startup believes it can make a diesel and a gasoline-like product that offer major advantages over ethanol and biodiesel, today's alternative-fuel darlings. "Why not look for better solutions?" says John G. Melo, chief executive of Amyris. "There is a second generation of fuels coming that could be very helpful to the country." But due to energy subsidies and years of lobbying by ethanol and biodiesel producers, those two fuels get the big breaks A number of states mandate that ethanol or biodiesel be blended with oil-based fuels, and Congress has locked in tax subsidies of 51 cents per gallon of ethanol and $1 per gallon of biodiesel. The laws also narrowly define biodiesel in terms of a specific process, shutting out innovations and improvements. Conoco and DuPont are betting on a biofuel known as butanol, which has more energy per gallon than ethanol and is compatible with today's pipelines and pumps. So are the fuels from startups like Amyris. "In the circles I move in, no one thinks we'll still be using ethanol in 25 years," says Stanford biologist Chris Somerville. Conoco and Tyson Foods Inc. (TSN ) announced plans to refine diesel from leftover poultry, pork, and beef fat. In addition to offering a better fuel than biodiesel, the operation will be a boon to livestock producers hurt by ethanol-boosted corn prices. "It's a technology that turns their waste products into fuel," says Conoco's Burke. Click here to read more about this issue on BusinessWeek.com, 2/19/07, "Ethanol: Too Much Hype—and Corn."

Toyota President Praises Detroit Toyota Motor Corp. President Katsuaki Watanabe avoided boasting about his company's successes as he made remarks during the closing banquet of the Society of Automotive Engineers World Congress last night in Detroit. Named head of Toyota in 2005, Watanabe's tenure has been marked by rapid growth in sales and production, particularly in the U.S. According to the Detroit Free Press, Toyota's U.S. sales increased by more than 12% last year and continued to grow at a double-digit rate through the first three months of this year. The growth has come as Detroit automakers close plants and struggle to retain market share. Watanabe didn't talk about his company's growth and declined to comment on the problems facing Detroit automakers. Instead he paid homage to Detroit, calling it the "cradle of the automobile industry." He said he enjoyed a visit earlier in the day to a display of Thomas Edison's research lab at Greenfield Village. Click here for Business Week's profile on Katsuaki Watanabe.

Carmakers Prepare Diesels for U.S. Market Nissan plans to sell a diesel-powered version of its Maxima sedan in the USA in 2010, joining a small but rapidly growing parade of diesel sellers. USA Today reports that the group includes Volkswagen, who says it is developing diesels specifically for the U.S. market and will sell them in the USA first, instead of starting in Europe. Other carmakers preparing diesels for the U.S. are Audi, Honda, and DaimlerChrysler. "It's a sort of bet you're making that (fuel-economy) regulations will continue to get stricter and fuel prices will continue to get higher," Nissan Motor CEO Carlos Ghosn said at a meeting of the Council on Foreign Relations Wednesday. He used the speech to announce what he said will be an "extremely powerful" diesel Maxima that will meet strict anti-pollution regulations in all 50 states. Diesels typically get 20 percent to 40 percent better fuel economy than gas engines. Because they burn less fuel, they emit less carbon dioxide, a so-called greenhouse gas blamed for global warming. And diesels generate more low-speed torque than gasoline engines, so they're suited to low-speed, stop-and-go driving common in the USA. Click here to learn exactly how diesel engines work.

Carter, Farley to lead Toyota, Lexus brands Two of Toyota's fast-rising stars, Bob Carter and Jim Farley, have been named general managers of the Toyota and Lexus divisions, respectively. According to Automotive News, the moves continue a recent trend of moving high-potential executives quickly through the ranks. Carter, 47, had been in charge of Lexus since 2005. He has been with Toyota Motor Sales for 26 years, much of the time with Lexus. Farley, 44, has been on the fast track since he oversaw the successful launch of the Scion youth brand in 2002. He had been Toyota Division vice president of marketing since 2005. The Toyota Division general manager's spot had been vacant since last summer's promotion of Jim Lentz to executive vice president of Toyota's sales arm. Although Lentz still held the de facto reins of Toyota Division, "It was a lot of waterfront to cover," a spokesman said. Farley's vacant marketing post will be filled within a few weeks.

Congress Cautious as DOHA Moves Forward Despite the absence of a major substantive breakthrough in the agriculture negotiations of the Doha round, U.S. Trade Representative Susan Schwab has announced that the U.S. will intensify efforts to conclude negotiations by the year's end. The G4 has agreed to a mid-June informal target date for developing a position on key agriculture issues that could be the basis for further multilateral negotiations in Geneva, according to Inside U.S. Trade. In a related development, 58 members of the Senate from both parties this week warned President Bush not to make any more concessions on farm subsidies if trading partners offer minimal market access. The letter, which was initiated by Sen. Kent Conrad (D-ND), is similar to one 54 senators sent in June last year. It seems to be based more on the fear that the Administration may offer additional farm subsidies cuts in a last-ditch attempt to achieve progress in Doha later this year than on any concrete indications that it will do so, a congressional aide said.

Roll Call: Upcoming Events in the Nation's Capitol April 23, Energy and Natural Resources Full Committee Hearing on Energy Efficiency. Agenda: S. 1115

April 23, Global Climate Change: Interior, Environment, and Related Agencies Subcommittee of House Appropriations Committee will hold a hearing on global climate change.

April 25, The Senate Commerce Committee will markup Senator Feinstein's CAFE legislation S.357. The bill raises CAFE standards to a combined 35 mpg by 2019. The current standards are set at 27.5 for passenger cars and 22.2 for light trucks

Date TBA, Global Climate Change: Technology Solutions Subcommittee Hearing

Date TBA, US – China Trade: House Ways and Means Committee, Subcommittee on Trade will hold a series of hearings on all aspects of U.S.-China Trade.