12th Annual Farmer Cooperatives Conference, November 9-10 in St. Paul, Minnesota.

1. 12th Annual Farmer Cooperatives Conference, November 9-10 in St. Paul, Minnesota. “Focus on Energy: Using Biomass for Fuel”

2. Making ethanol work for the world.™ Larry Johnson Business & Project Development

3. Biomass Business Development Collection Handling Storage

4. Market Opportunities & Drivers www.dsireusa.org • “Green Energy” Mandates WA: 15% by 2020* ME: 30% by 2000 New RE: 10% by 2017 VT: (1) RE meets any increase in retail sales by 2012; (2) 20% RE & CHP by 2017 MN: 25% by 2025 (Xcel: 30% by 2020) MT: 15% by 2015 • NH: 23.8% by 2025 ND: 10% by 2015 MI: 10% + 1,100 MW by 2015* • MA: 15% by 2020+1% annual increase(Class I Renewables) • OR: 25% by 2025(large utilities)* 5% - 10% by 2025 (smaller utilities) SD: 10% by 2015 WI: Varies by utility; 10% by 2015 goal • NY: 24% by 2013 RI: 16% by 2020 CT: 23% by 2020 • NV: 25% by 2025* IA: 105 MW • OH: 25% by 2025† • CO: 20% by 2020(IOUs) 10% by 2020 (co-ops & large munis)* • PA: 18% by 2020† WV: 25% by 2025*† • IL: 25% by 2025 • NJ: 22.5% by 2021 CA: 20% by 2010 UT: 20% by 2025* KS: 20% by 2020 VA: 15% by 2025* • MD: 20% by 2022 • MO: 15% by 2021 • AZ: 15% by 2025 • DE: 20% by 2019* • NC: 12.5% by 2021(IOUs) 10% by 2018 (co-ops & munis) • DC: 20% by 2020 • NM: 20% by 2020(IOUs) • 10% by 2020 (co-ops) TX: 5,880 MW by 2015 29 Stateshave an RPS 6 states have goals HI: 40% by 2030 State renewable portfolio standard Minimum solar or customer-sited requirement * State renewable portfolio goal Extra credit for solar or customer-sited renewables † Solar water heating eligible Includes non-renewable alternative resources

5. Market Opportunities & Drivers BioFuels Production and RFS2

6. Leading Cellulosic Company Projections

7. Development and consumption of biomass by DONG Energy starting from 1989.

8. Inbicon’s raw material know-how: DONG Energy’s 100% biomass-fired power plant.

9. “Billion Ton Study”(2005 USDA and DOE) • 368MMDT/Y - Forest Products • 998MMDY/Y - Agricultural • 1,368,000,000 Total Dry Tons Available • Potential for > 100 Billion Gallons of Ethanol

10. Available (Non-oil)Feedstocks • Woody Biomass • Designated Energy Crops • MSW and Industrial Wastes • Crop Residues

11. Woody Biomass • Lumber Harvest Residues • Milling Byproducts • Tree Plantations • Orchard Trimmings • Forest Management • Urban Green Wastes

12. Designated Energy Crops • Sorghum • Sugarcane • Miscanthus • Switchgrass • Poplars/Willows • Algae • Exotics

13. MSW and Industrial Wastes • Grain Processing Byproducts • Industrial Wastes • Consumer Wastes • Food and Beverage Byproducts

14. Crop Residues • Wheat and Barley Straw • Rice Straw • Corn Stover • Corn Cobs • Bagasse • Grasses

15. Power Generation Synergies Ethanol Inbicon Biomass Refinery 50MT/hr (20Mgpy) Straw/Stover/Cob C5 Molasses lignin Steam Power Energy Reduction of 50-100%+ On-Site CHP Plant Existing 100Mgpy Grain-based Ethanol Facility Steam Multi-fuel (as req’d) Power

16. 1,200 MT/day – 20Mgpy Inbicon Biomass Refinery™

17. Biomass Refinery: Kalundborg, DK

18. Baler from Krone capable of pressing 4’X4’X8’ bales weighing about 1300 lbs.

19. Moving and Stacking

20. Tarp Covering U.S.

21. Wheat Straw Storage: Stokervarme, DK

22. Corn Stover vs. Corn Cobs

23. Single-pass stover collection • Higher capital costs • Lower operating costs • Very clean product • Contains all the cobs • Reduced volume per acre • Less moisture control • Compliments farmers’ schedule

24. Multi-pass stover collection • Lower capital costs • Higher operating costs • May contain 10% dirt • Contains very few cobs • Greater volume per acre • More moisture control • Requires farmer scheduling

25. Roadsiding Corn Stover Bales

26. One Pass Stover Bale with Cobs

27. One Pass System

28. Inbicon Biomass Refinery™ 50MT/hr500,000 tons per year from field to plant. • 200,000 acres @ 2.5 tons/acre • 500 farmer contracts @400 acres/farmer • Each contract will have options/variables • $15 million in inventory @ $30/ton • 250 acres for storage sites

29. Inbicon Biomass Refinery™ 50MT/hr500,000 tons per year from field to plant. • 800,000 bales @ 13 pound density • 20,000 bales/day in a 40 day harvest season • 555 semi-loads per day @ 36 bales/load • 50 balers required @ 100 acres/day

30. Define Feedstock Specifications and Conversion Economics • What does the plant need? • Cob/stalk ratio • What will the plant accept? • Moisture content • What is the pricing formula? • Contract specifications

31. Define Feedstock Availability • Use GIS analysis and regional crop history • Coordinate radius with road delivery system • Estimate tons harvested per acre • Calculate % of total available acres needed

33. Defined 25 mile radius of selected plants

34. Tracking of biomass bales per field

35. Sequence of Activities • Feedstock Supply Analysis • Create Procurement Company • Develop Procurement Model • Initiate Procurement Contracts • Define Collection and Storage Logistics • Implement Program

36. Write Business Plan for Procurement Company • Procurement and delivery contracts • Define logistical and timing details • Credit-worthy feedstock supplier • Financing of procurement company • Staffing - personnel • Equipment requirements • Deposit on farmer contracts • feedstock payment • Fuel purchase and storage • Regional Storage Sites • Insurance

37. Create Procurement Company • Host plant subsidiary • Farmer owned cooperative • Independent company

38. Create Feedstock Procurement Model • Identify and contact growers • FCS office (USDA) • Host plant customers • Grain elevators • Farm groups and associations

39. Design data collection program • Local weather reporting system • GPS field locations • ID and quantify product at harvest • Match harvest with each contract • Identify and coordinate storage sites

40. Research and Apply for Grants • Federal (BCAP) • State (Economic Development) • Local (TIF – Utilities)

41. Implement Feedstock Procurement Model • Form a local advisory committee • Identify and contact growers • FCS office (USDA) • Host plant customers • Grain elevators • Farm groups and associations

42. Contract requirements and details • Negotiate harvest schedule with growers • Quality control and land use details • Incentives and penalties • Payment guarantees • On farm storage where applicable

43. Hire Project Manager and Staffing as Necessary Full time staffing activities • General Mgr. and CFO (1) • Office and clerical (1) • Acquire and service contracts (3) • Scheduling and coordinating harvest (1) • Staff hiring and training (1) • Manage harvest crews (1) • Equipment maintenance (2) • Fuel supply infrastructure (1) • Manage feedstock inventories (1)

44. Seasonal and Contract Employees • Part time staffing (harvest) • Harvest and collection (~50) • Trucking from field to storage (~45) • Manage fuel delivery (1) • Collect and coordinate data (~5) • Miscellaneous “Gofer” (1)

45. Implement Feedstock Procurement Program • Identify all growers within a plant radius • Conduct grower informational meetings • Negotiate and sign contracts for delivery

46. Equipment Procurement • Balers, semis, loaders, stackers, wagons, fuel trucks, choppers, windrowers • Purchase • Lease • Custom Contract

47. Fuel Depots and Fuel Demand • Harvesting: Balers, Tractors, Loaders • Trucking: To Plant and Regional Storage Sites • Stacking: Roadside and Regional Storage

48. Purchasing/Leasing of Storage Sites • Grading and Drainage • Road Access • Zoning and Permitting

49. Baling and Removal From Field • Roadside storage • Farmer storage • Tempering • Bale covering • Weighing and accounting

50. Collection of harvest data • Field location and harvest date • Bale count, moisture and density • Ownership recording and receipt • Reconciliation with Contract • Storage site destination