Earth Sense Energy Usa Ppt 09 28 09 2003 Version
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Earth Sense Energy Usa Ppt 09 28 09 2003 Version Earth Sense Energy Usa Ppt 09 28 09 2003 Version Presentation Transcript

  • Alternative Energy From Plants
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    • Executive Summary 3-4
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    • Business Description 4
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    • Business Description 5-7
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    • Market Opportunities 8-10
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    • Competition 11&16
    • Strategy 12
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    • Carbon Credits 13-14
    • Biomass Market/Organizational Development 17-18
    • Biomass Conversion 15
    • Biomass Statistics 19
    • Appendices 20
    • Earth Sense Energy USA was created by David Robbins and team in 2008 from the recreation of a business plan hatched while working for a multinational company (the “MNC”) listed on the Singapore Exchange.. David was the CEO/President of a subsidiary of the Singapore-based company, named Speedling, Inc. in the USA. with production facilities in China and markets in North America and Asia.
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    • David brought over 30 years of agricultural/horticultural management experience to the team and held a BA in Business Administration/Accounting, graduate certifications from Stanford University and law education from Seattle University. Other partners, including a R&D Director, a CFO, a HR Director and a CTO Officer who have been identified, will join our group at the time of business funding. We have also an extensive network of advisors and strategic business partners who have specialized expertise in energy crops, agricultural machinery, and pellet plant operations. They are being engaged in the interim to vet the numbers and validate the assumptions.
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    • When Speedling, Inc. was caught up in the recession which impacted its customers, the reduction in sales sharply curtailed its profits and prompted the MNC to abandon R&D efforts and attractive investment opportunities and replace senior management personnel with “turnaround” management. As an exit severance in February 2008, David took his ideas and decades of agriculture/horticulture and food processing experience and created Earth Sense Energy USA, a company founded in theory in July 2008 and slated to organize legally as a California corporation before 2010. Since July 2008, the business plan has been updated with latest information about the progress of plant genetics as well as establishment technologies, including a field trip to Australia to witness operations and collect data. These activities have helped the business plan to evolve while retaining its numerous market venues, which ultimately will reduce the market risk for this business proposition in the biomass economy.
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    • This plan is a proprietary and confidential document meant to focus upon and clarify Earth Sense Energy USA’s opportunities in the BIOMASS ECONOMY, particularly in the US, but also in South America, China and Australia. “In short, we (the biomass industry and our nation) have a historic opportunity to re-imagine agriculture to accommodate large scale energy production.” Earth Sense Energy USA is in a position to make this more than an American opportunity. We believe we can beat analyst’s projections for the amount of biomass under cultivation by 2012.
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    • Dr Lee R. Lynd, testimony before Congress, May 9 2007 http://agriculture.senate.gov/Hearings/hearings.cfm?hearingid=2726&witnessId=6448
    • Millions of acres of biomass will need to be planted in the US. The US uses 140 billion gallons of gasoline annually now. The DOE estimates that 1.3 billion dry tons of biomass could produce 130 billion gallons of ethanol. That converts to 86 million acres of land at today’s production standards of 15 tons per acre and 100 gallons per ton. By comparison, 250 million acres of land are now used for animal feed and there are 120 million acres in Conservation Reserve Land. Reaching the goal of 25% of total US energy needs coming from farm and forest could increase farm income by $180 billion.
    • In winter of 2009 Earth Sense Energy USA will make early entry into the propagation of Miscanthus transplants via an exclusive agreement with one of the very few sources of Miscanthus plant material in the world. We will be the first to make Miscanthus commercially available to growers.
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    • For Earth Sense Energy USA to leverage and maintain this lead we will need to be more than a supplier of transplants. Miscanthus is a 20-year perennial requiring long-term retained interests in plant material, agronomy, crop financing, land, carbon credits, harvesting, and end uses. We will also need to understand government funding and regulation. Capitalizing on new opportunities will have many challenges.
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    • Earth Sense Energy USA must cultivate profitable long-term relationships with conventional farmers, energy coops, agricultural investors, agronomic partners, harvesters, carbon credit experts, fuel users, energy converters, government agencies and consumer products manufacturers. To maximize opportunities, we will need to have strategic partnerships and alliances with many segments of the industry. We can augment and optimize our corporate structure and resources.
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    • Now is the time to invest in crops and technologies that, though perhaps imperfect, are necessary elements on the biohol trajectory.
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    • Vinod Khosla, Imagining the Future of Gasoline , Industrial Biotechnology, pp 189, Fall 2006
    • 25 x 25 Report, University of Tennessee, November 2006
    • Vinod Khosla, Imagining the Future of Gasoline , Industrial Biotechnology, pp 189, Fall 2006
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    • We are entering the Biomass Economy. It is characterized as a change from petroleum to carbohydrates for the energy to power our economies. Earth Sense Energy USA’s entry to the new economy is via Miscanthus transplants. Success in this familiar arena will present challenges and opportunities far beyond Earth Sense Energy USA’s historic scope of investment and return. Activities that begin as services to facilitate the sale of transplants may become major business ventures in themselves. There are four major segments of the emerging Biomass Economy.
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    • Research – finding out what works
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    • Years of research with plants and conversion of biomass to fuels and energy have been done and continues today. Academic institutions across the country have done research on the efficacy of biomass for energy and the characteristics of leading dedicated energy crops from wood to annual crops and perennial grasses like Miscanthus. The DOE projects that by 2020, the majority of ethanol will have to be biomass-based, cellulosic ethanol. Cellulosic ethanol plants are being built and offer the next step in fuel conversion. Intensive research continues on various methods of converting biomass to liquid fuel, co-combustion and gasification. New plant strains and cropping systems are being researched. New technologies will continue to emerge in the Biomass Economy.
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    • The challenge for Earth Sense Energy USA is to establish and hold a position that demonstrates our leadership in commercially viable energy crop establishment methods so researchers will choose Earth Sense Energy USA as the preferred conduit for taking new plant strains to market. On the fuel conversion side, Earth Sense Energy USA needs to keep well informed so that we can assist growers in finding markets and making opportune investments along the Farm to Fuel chain.
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    • Agronomics – establishing, growing, financing, harvesting, selling
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    • Energy crop establishment and management is the least developed segment of the Biomass Economy. Miscanthus has higher than ordinary establishment costs, somewhat unfamiliar growing habits and practices, modified harvesting, new concepts of plant ownership, and undefined markets. While it is acknowledged that billions of tons will be needed it is not certain what form the harvested material and conversion processes will take. Miscanthus growers may be farmers, Agriculture REITS, agricultural coops, utilities, resource extraction companies, or partnerships among any of these Kstate extension, Renewable Fuels and the BioEconomy, #69, February 2007
    • players. Biomass growers, including farmers, will require crop management and financial services from Earth Sense Energy USA and its partners for Miscanthus to become successful in the first 2-3 years. Earth Sense Energy USA, via a network of service partnerships it must establish, will have opportunities to profit from transplants, service fees and investment partnerships. Given the variety of uses for biomass, especially Miscanthus, the demand is imminent. Now is the time to move because it takes two years for the first high yield harvest. By then the demand will be ramped up as conversion cellulosic ethanol plants come on line. The geometric expansion of Miscanthus acres to achieve 1.3 billion tons of material begins with getting plants in the ground as soon as possible.
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    • Carbon Trading - financial instruments for environmental change
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    • In the European Union in 2006 18 billion Euros exchanged hands in the emissions trading, based upon 1, 17 million tons. Carbon trading will be the marker for the progress of the Biomass Economy. The tons of carbon removed from the atmosphere are as critical a component in the Biomass economy as mega joules of alternative energy produced. Trading on the Carbon Market will track the millions of acres planted in biomass and used for energy and products. Early estimates of Earth Sense Energy USA crop establishment project that 34 million Carbon Credit instruments will be created from our work plantings over 5 years. That is $174 million dollars at the low projected price of $5 per ton. Ownership of all of these Carbon Credits created will be determined by Earth Sense Energy USA negotiations in the agronomic process.
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    • Conversion – making it usable
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    • Biomass can be converted to liquid fuels such as ethanol and biodiesel, used in direct combustion for electric generation, burned for process heat or space heating, gasified for direct feed into natural gas pipelines, and used for consumer products manufacture. Selling transplants and crop services in cooperation with customers may well mean that Earth Sense Energy USA becomes involved with conversion processes and companies to insure a market for the harvested crop. Initially this may be a sales strategy to overcome marketing challenges, but energy conversion presents an opportunity for Earth Sense Energy USA to become vertically integrated with the Biomass economy through strategic partnerships or investment in emerging technologies.
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    • Earth Sense Energy USA’s role and options
    • Kjetil Røine, senior analyst at Point Carbon, Future Industry Magazine, May/June 2007
    • John Caveny, ECCI,
    • Earth Sense Energy USA is a corporation with defined wholesale products in the energy crop markets. Earth Sense Energy USA will be the largest producer of energy grass in the USA in the next 3-5 years. We have the best and brightest key management in operations, marketing and executives. Our CEO has over 32 years experience in agricultural, food processing and horticultural management roles from operations management to CEO/COO/CFO. We have R&D experience with Seed breeding and business development expertise in agriculture. We have used our plant expertise to become an early leader in commercialization of cropping systems for dedicated energy crops. Earth Sense Energy USA has a solid entry to the Biomass Economy. Maintaining that lead and seizing opportunities to vertically integrate within the new economy will require that Earth Sense Energy USA utilize resources effectively, commit to new investments and develop a corporate culture that promotes creation of synergistic ventures with other stakeholders in the Biomass Economy. Our plan is to build into our model "brick and mortar" in high technology greenhouses and field planting automation, cubing and pelletizing mills and micro electricity generating plants of 5 to 30 MW in capacity. The chart below shows Earth Sense Energy USA relative strengths in various markets based on three criteria.
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    • Earth Sense Energy USA has Biomass Economy market opportunities in the familiar field of Crop Services, and the strategically allied markets for carbon trading and biomass conversion.
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    • Crop Services
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    • Market Description
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    • “ Agriculture will provide 25 percent of the total energy consumed in the United States by 2025 while continuing to produce abundant, safe and affordable food and fiber. Khosla predicts 43 million (biomass) acres by 2025 just for ethanol for transport. Dedicated energy crops will comprise a significant portion. One report states “At $40 per dry ton, farmers growing 200 million tons of biomass in 2025 would make a profit of $5 billion.” The early stage of the market and the complex dynamics, make it difficult to set a value on the biomass market, but undoubtedly there are significant market opportunities for Earth Sense Energy USA. The primary market is located in the Midwest and Southeastern US.
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    • Our physical products in this market are Miscanthus transplants and Miscanthus cane (baled or densified). Of equal or greater importance are the services that we will be required to offer to achieve success with our establishment system, plant type and species genetics.
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    • 25 x 25 Report, University of Tennessee, November 2006
    • Khosla, Industrial Biotechnology, Imagining the Future of Gasoline, p 180,
    • NRDC, Growing Energy, How Biofuels Can Help End America’s oil Dependence, p vi
    • Miscanthus x giganteus is the recognized premier dedicated energy crop world wide because of high yields, low input needs, long life and range of growing zones. While Miscanthus has been researched and utilized in Europe for two decades, the US biomass market has focused attention on other crops. There are very limited stands of MXG in the US and further plants cannot be imported. Earth Sense Energy USA has gained access to the rootstock, has access to sterile hybrid seed varieties and the exclusive right to commercialize one Miscanthus field. To date we have proven that making transplants from the vegetative "root shoots" of the rhizomes produces the highest multiplication of the crop(upwards of 90:1). This is only the case because of the development lead/lag of seeded sterile hybrids. One method of expansion is to harvest rhizomes in the field, divide them to some extent and replant them in new parts of the same field. “In field” transplanting does not yield the same multiplication rate, but some indications are that it may be less expensive. However, it is fraught with plant clumps and misses and lacks the uniformity of precision planted fields. Therefore, our focus will be on the precision planting of transplants, developed either from seed or vegetatively from root shoots.
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    • The task is to sell this dual cropping system to a wide range of customers with varied levels of growing expertise and investment strengths. Since millions of acres of biomass are needed, it is important to facilitate rapid expansion of total Miscanthus acres under cultivation to deliver biomass as the demand grows.
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    • Customers can be Western, Midwestern and Southeastern US farmers, mining companies who need to do reclamation and simultaneously build fuel reserves, fuel processors, and utilities or others doing direct combustion. In the Biomass Economy the distinctions of grower and crop user are not yet determined. To facilitate the massive acreage required in the short timeframe, we will choose the Southernmost latitude for early planting and work our way Northward until we reach a back off date(approximately July 1 in Northern latitudes) which allows for a dependable rhizome size when the permafrost begins to threaten the plants viability during winter.
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    • Value
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    • Propagation projections based on our current available mother stock, show we are capable of producing 1.5 billion Miscanthus transplants from 2009 -2013 at a value from .24 - .40 per plug. ($352 million in revenue at average price of .32) This equates to 200,000 to 300,000 acres at a field density of 5000-7,500 plugs/acre. In field expansion could add 2 billion plants if 10% of available rhizome acres were harvested and transplanted. This would be an additional 300,000 to 400,000 acres. ($200 million at a fee of $500 per acre) Using both methods, with current production figures means that Earth Sense Energy USA products and services would plant 10-15% of the total biomass acres projected for 2012. (5 million acres.) Acquiring new sources of mother stock, proliferating seeded sterile hybrids, harvesting more than 10% of existing fields, or increasing propagation rates could increase our portion of the total biomass acres. Continue to develop our transplant production for Miscanthus. It goes without saying that conspicuous planting of the scale we are planning to execute will inspire many competitive entrants to join the field of dedicated energy crops. Conceivably, our business will be approached with other dedicated energy crops, such as Switch grass and Coppice and we will apply common resources to serve that market, if it furthers the mission of Earth Sense Energy USA.
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    • Hurdles
    • We are selling perennial crop with delayed returns, high establishment costs, and unfamiliar agronomic practices to traditional farmers, or, customers with no growing experience.
    • There is no certain immediate demand even though every projection calls for millions of acres.
    • The Biomass Economy has been focused on research, not on growing the new energy crops.
    • Achieving critical mass means getting customers to commit initial acres and ongoing acres as well.
    • Convincing people to make the investment now rather than waiting
    • Earth Sense Energy USA's Miscanthus is not yet branded and Earth Sense Energy USA is not yet widely recognized as the leader in commercial Miscanthus opportunities.
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    • Vinod Khosla, Imagining the Future of Gasoline , Industrial Biotechnology, pp 180, Fall 2006
    • Competition
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    • Potential competitors may be other transplant companies. Due to the length of time to bring seed from research to production and the complexity associated with a vegetative to energy closed loop process, this is a business which is outside of many established companies risk tolerance. Not unlike processing Tomatoes in 1990, once the analytical farmers embrace this crop, others will quickly join the fray to share in this new economy. One demonstration project of large scale will change the perceptions of the conservative agriculture industry and kick start the momentum necessary to achieve the acreage goals outlined for energy crops in the USA and the world. At his time we have a one-year lead in making transplants and a two year lead in operations/field and marketing research. We have relationships with the two preeminent breeders of sterile hybrid Miscanthus from seed and they have expressed eagerness in working closely with Earth Sense on promoting their varieties in the USA and abroad. Research organizations have come out with improved varieties, but this is their area of expertise and Earth Sense brings plant production technology to the supply chain unparalleled in the USA. Earth Sense Energy USA is in discussion with these breeders to optimize the value to all members in the supply chain with early, late, cold tolerant or higher yielding varieties. It is difficult to foresee now how small increases in yield or growing zone adaptability will justify higher costs, but intuitively, the uniformity and yield from 100% field stands will optimize the plant potential and university yields will be attainable under commercial production. With Earth Sense Energy USA growing expertise, we will be in a position to grow and market the improved varieties as well as the ones we have under production now. Our customers could use “in field” expansion services besides ours. Farmers may choose other energy crops like corn, sorghum, or Switch grass.
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    • Form strategic alliances that include BiCal and BiUS and other crop management partners so we can offer a full range of agronomic services, including planting, growing, in field expansion, harvesting and storage.
    • Use grower contracts that establish long-term relationships to encourage using our product (transplants) and services.
    • Establish as many acres as possible where we have some opportunity to use rhizomes to make transplants or do in field expansion.
    • Continue to search for and gain exclusive propagation rights to any remaining stands of Miscanthus x giganteus in the US.
    • Finance crops, spread investment risk with qualified farmers.
    • Establish growing partnerships with some customers, where we contribute plants and the farmer provides land, inputs and crop management.
    • Offer turn-key establishment and growing contracts with customers like mining firms and utilities that may have land but no farming expertise.
    • Create feed stock contracts and other opportunities connecting growers and users
    • Continue education and public relations highlighting the efficacy of Miscanthus and our cropping systems
    • Seek and work with Agricultural REITS as a supplier of products and services and/or investment partner.
    • Via continued public relations and trade marking, get Earth Sense Energy USA Miscanthus recognized as the leader
    • A carbon credit is a 2000 pound unit of carbon dioxide that is no longer an environmental burden. To have value, Carbon Credits are quantified using standard methods and are certified and verifiable in a transparent manner.
    • Carbon Credits can be quantified and claimed from two broad categories of anthropogenic activities: carbon avoidance and carbon sequestration. Generally carbon avoidance means releasing less fossil carbon into the environment based on “business as usual” activities and carbon sequestration is the deliberate act of removing and storing emitted carbon dioxide from the air.
    • In agricultural production systems, the cropping practice of no-till planting is an example of carbon avoidance because less fossil fuel is used to plant a crop. Rest rotational grazing systems that stimulate an increase in perennial forage crop production by increasing annual photosynthetic activity is an example of carbon sequestration.
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    • Renewable energy crops used as fuel stocks for base load energy create a carbon positive source of energy, i.e., a net reduction of CO2 in the atmosphere. Dedicated grassy bioenergy crops such as switch grass and Miscanthus or woody coppice plants such as hybrid poplars and willows can be used as fuel-stocks to generate electricity, bio-gas and bio-oil. Growing these crops favorably impact the CO 2 concentration in the atmosphere in two ways:
    • Emission of fossil CO 2 is avoided, thus slowing the rate at which the atmospheric CO2 concentration is rising; and
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    • Approximately ½ of the CO 2 used by the plant during the growing season is stored in the root system, much of which is eventually assimilated into the soil. This action decreases atmospheric CO2.
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    • Carbon credits are a uniform, defined way of creating a financial instrument that can be held like any security and traded when desired. Carbon credits are not he same as carbon offsets. The Chicago Climate Exchange issues tradable Carbon Financial Instrument™ (CFI™) contracts to owners or aggregators of eligible projects on the basis of sequestration, destruction or displacement of GHG emissions . Such CFI contracts require that the owner or aggregator be a member of the Exchange.
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    • Carbon Credits from agricultural activities can only verified under license because of a patented process owned by ECCI. If the offsetting practice fits certain guidelines a carbon certificate is issued. Establishing a carbon Account is the initial step in the verification process is done for a one-time fee. Each year thereafter a fee is charged to quantify amounts of CO2 sequestered using actual production records and re-verify that the project is still properly in place. The certified, verifiable certificates can be held by any party involved in the project. For example, if Earth Sense Energy USA sells 2 acres of Miscanthus to a grower, either Earth Sense Energy USA or the grower own the Carbon credits for the amount of carbon sequestered by that project. Two acres of mature Miscanthus would create 55 Carbon credits. Whichever party retains the certificate pays the initial and subsequent annual validation fees. As the US carbon market matures, these Carbon Certificates will have evolving market value. Presumably, more emissions will need to be offset by measures (as verified with Carbon Certificates) that reduce CO 2 . Retained ownership of Carbon Credits will be a lucrative part of biomass crops such as Miscanthus.
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    • The value of carbon credits from planting Miscanthus is as yet unknown. The situation is similar to an IPO. Value will be set by future markets. The number of Credits retained by Earth Sense Energy USA is undetermined because each sales transaction for transplants in field expansion will be negotiated with respect to price, fee for service, and carbon credits. It is reasonable to say that with several million acres of Miscanthus being planted that several million verifiable carbon credits will be created and that Earth Sense Energy USA will retain some potion of those, which become an asset with market value. The current value for one ton of carbon sequestered or emission avoidance is between $5 and $15.
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    • Hurdles
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    • As yet there is no uniform and organized carbon trading market in the USA. A Cap and Trade mechanism, common to Europe has not been put in place largely because of the US non-participation in the Kyoto Treaty.
    • Since we do not know the value of Carbon Credits at the outset of a project, it will be difficult to negotiate this portion of each sale or partnership.
    • With momentum gathering in the carbon trading market, vigilance is required to defend against patent infringements.
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    • Competition
    • At this time there is only one patented system of quantifying carbon removed from the atmosphere. Most of the carbon trading being done is through private treaties where one the party putting CO 2 into the environment contracts with a party to do something that removes and sequesters carbon. The carbon trading market is as yet somewhat undefined in the US, but it is anticipated to be determined in the near future.
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    • Strategy
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    • The best way to participate in Carbon Credit field is buying controlling interest in ECCI who holds the patents for validation and certification of Carbon Credits.
    • Purchase of controlling interest in ECCI and their intellectual property will establish Earth Sense Energy USA as a participant with every acre of biomass planted in any country where the patents apply.
    • Continue to study and be informed about the processes and stakeholders in the carbon-trading field.
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    • John Caveny, ECCI.
    • Conversion of biomass to fuel or consumer products is an opportunity for Earth Sense Energy USA. Earth Sense Energy USA has the potential to participate in the establishment of fuel-stock supply contracts. This would enhance our portfolio of services to growers. Emerging technologies present opportunities for acquisition or joint ventures integrated with our crop management systems. After being chopped or baled Miscanthus is ready for direct combustion, ethanol plants, gaseous conversion or storage. Post harvest, Miscanthus can also be converted to pellets which concentrate the energy in the material to make it easier to transport and store. In pellet form it can also be sold directly into the consumer market for heating fuel. Earth Sense Energy USA may want to participate in ownership of downstream process, like gaseous conversion, pelletizing or conversion to oils or ethanol. Putting the harvested crop into some intermediary form like pellets could also be an Earth Sense Energy USA owned operation. Direct combustion for heat processes or electrical generation may be an immediate market for biomass.
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    • Value
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    • Participation in post harvest conversion can stimulate sales of transplants by developing the demand side for our growers. It can provide long-term revenue streams by ownership in promising aspects of conversion from cellulosic mass to useful product. Earth Sense Energy USA will have to set up partnerships, or full ownership of emerging conversion technologies. Potential dollar value can only be estimated.
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    • Hurdles
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    • Energy conversion processes are capital intensive
    • Earth Sense Energy USA does not have any direct experience in energy conversion processes.
    • Many biomass conversion processes are in development making exact feed-stock requirements uncertain
    • The fuel pellet market offers opportunities, but the consumer market is already well populated
    • Earth Sense Energy USA intends to dedicate resources to research and devise strategies for entering the energy conversion industry
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    • This part of the market is well populated by expert, well financed companies building refineries, gasification plants. Competitive technologies are emerging that have indeterminate prospects. In joint ventures we would be competing with other sources of capital.
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    • Strategy
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    • Concentrate on efforts in the conversion field that can be linked with our involvement in growing.
    • Develop contacts with utilities owning coal fired generation facilities
    • Seek partnerships with growers near gas pipelines.
    • Collaborate with Solar or Wind Farms to develop solar, wind or biomass to electricity micro power plants
    • Investigate emerging conversion technologies for acquisition (anaerobic digestion, pyrolysis, densification)
    • Partner with utilities or mining companies that need to build reserves, reduce emissions by co-firing or do land reclamation.
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    • To gain position in the Biomass Economy will require design and development of products, service systems and a corporate attitude of researching and capitalizing on new opportunities. Corporate resources will need to be allocated to continue product development, market development and organizational development.
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    • Product Development
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    • We have completed the initial stage of developing transplants from a known Miscanthus cultivar. We will continue to work on propagation techniques to reduce the cost of making transplants. We will have initial quantities of the physical product available in November 2009. The service part of our product offering will be developed before Spring 2010. Services will include transplanting, cooperative financing, growing, and harvesting. In some cases these services will be comprised of partnerships with firms well established in the industry.
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    • Carbon Credits are an additional “product” Earth Sense Energy USA offers as an integral part of selling biomass cropping systems. We need to solidify our participation options with Carbon Credits. Our ability to offer carbon credits is vitally integrated with everything we do to enter the Biomass Economy.
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    • Product development tasks
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    • Obtain Plant materials from Bical-Winter 2009
    • Plant mother stock in nursery in California – Winter 2009
    • Begin propagation of root shoots in California-December 2009
    • Complete cost analysis for transplant pricing
    • Determine potential service partners (BiCal, Crop Quest) –Oct 2009
    • Establish crop lending procedures – January 2010
    • Purchase existing nursery land in California(30 acres)
    • Build high tech nursery in California-Spring 2010
    • Get this year’s crop sold so it can be expanded next year
    • Complete purchase or joint venture with ECCI
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    • Market Development
    • While it is generally accepted that the biomass market will require planting millions of acres, to date, with the exception of corn and trial fields of Switch grass, substantial dedicated energy crop acres are not being planted. Potential target markets for products, services and joint venture opportunities are:
      • Farmers in the West, Midwest and Southeast
      • Coal fired utility plants with available land (Transmission ROW)
      • Mining companies with reclamation and reserve building needs
      • Agricultural REITS
      • Ethanol refineries with land or contract growers
      • Other fuel processors
      • Utilities needing carbon offsets (carbon credits)
    • Conversion technologies that use Miscanthus
    • Earth Sense Energy USA will need to continue an aggressive Public Relations campaign, advertising and targeted contact with markets.
    • Continue to pursue information/PR campaign
    • Establish and implement an advertising campaign
    • Continue target contacts with potential Biomass users/growers
    • Know and understand government agricultural incentives
    • Public relations in carbon trading field
    • Research all potential markets and devise strategies
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    • Organizational Development
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    • In addition to Earth Sense Energy USA’s more familiar role with transplants and crop systems, the Biomass Economy invites Earth Sense Energy USA to position itself as a strategic partner or buyer of emergent technologies.
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    • Organizational development tasks
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    • Create a position in Earth Sense Energy USA to investigate strategic alliances and acquisitions and investment options.
    • Create an internal information network that collects, shares, compiles and acts upon action upon all possible data in the Biomass Economy.
    • Create a Biomass Economy team that confers regularly.
    • An “Average” cellulosic ethanol plant needs 2000 tons of dry biomass per day. (KState Extension, Agronomy E updates, #69, Feb 16,2007)
    • Miscanthus yields 1500 gallons of ethanol per acre at today’s crop yields and conversion efficiencies. (15 tons x 100gpt) (MXG yields, Heaton & Long, UICU)
    • One mature acre of Miscanthus can yield enough transplants to plant 90-100 acres, or enough rhizomes for in field expansion to 20-30 acres. (Earth Sense Energy USA and BiCal)
    • Gallons per acre of various crops (www.swivel.com/graphs)
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    • U.S. Secretary of Energy Samuel Bodman has set a goal of making ethanol a practical and cost-competitive alternative by 2012 (at $1.07 a gallon) and displacing 30% of gasoline (60 billion gallons) by 2030.
    • Cellulosic biomass at $40 per ton equals crude oil at $13 a barrel (Lee Lynd, Dartmouth, RBAEF, Role of Biomass in America’s Energy Future, 2004)
    • European Carbon Trading data, Kjetil Røine, senior analyst at Point Carbon, Future Industry Magazine, May/June 2007
    • Current value of Miscanthus is $50 per dry ton, ECCI Report, June 2005. And others. Price partially determined by price of oil and coal.
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    • I 25x25 report
    • ii Khosla, Imagining the Future of Gasoline
    • iii Department of Environment, Food and Rural Affairs,
    • UK,Planting and Growing Miscanthus, Best practice
    • guidelines
    • iv Lynd, Transformative Biomass Energy Benefits,
    • January 2006
    • v ECCI, The Feasibility of Commercially Growing
    • Miscanthus to Produce Green Power in Illinois, June
    • 2005
    • vi Lynd Testimony before the US Senate, Farm and
    • Rural Energy Issues
    • vii Robbins, Economic model for Miscanthus as direct
    • combustion competitor to coal, June 2007
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    •