Cellulosic biofuel is in production in one major plant, and more are on their way. The progress may be just in the nick of time. As commodity prices have risen, the old food versus fuel debate has morphed into fuel versus food and feed.
When corn prices rose a few years ago, some in the corn ethanol industry demanded a grain reserve to protect ethanol producers. These days the industry is simply trying to hold on to the Renewable Fuel Standard (RFS) as fears of rising food prices provide fodder for a powerful triad of consumers, livestock feeders and anti-biofuel forces.
At the same time, the corn ethanol industry is in economic retreat as ethanol plants cut back and even close in the face of the recessionary impact on gasoline demand and negative margins due to high commodity prices. By contrast, cellulosic biofuel is a bright spot, one of several in the next generation of biofuels.
"Between now and 2017 we will see a number of companies deploy and build cellulosic biofuel plants," said Mike McAdams, president, Advanced Biofuels Association (ABF). "There is every type of technology coming at this thing with a lot of major companies with significant investments in research and development. Some have begun engineering and permitting, others are building, and some are already operating."
PRODUCING ETHANOL CHEAPER
One of the companies that is making the investment is Chemtex Global S.A. with its collaborative partner Novozymes North America. "Cellulosic technology is real, and it is here today," said Dennis Leong, executive vice president, marketing and business development, Chemtex Global S.A. "It is commercially attractive and commercially viable. We believe we can produce ethanol at a lower cost per gallon than with corn or sugar cane."
With one plant up and running in Italy and a second scheduled for North Carolina, Leong is confident of his claims. The company has been producing ethanol from cellulose at a pilot plant for four years. Both plants are designed to use biomass treated with enzymes from industry partner Novozyme. The enzymes turn the cellulose into sugar before it is fermented and ethanol is produced.
"We can use tree crops, and we may in the short term, but we'll be transitioning to dedicated energy crops grown on low quality land not suitable for crop production," said Leong. "We are trying to make something from nothing on land that is just lying there."
Kior, Inc. also will be making biofuel from cellulose, but it is a different breed of biofuel. By the time this article is in print, the company's new 11 million gallons per year plant in Mississippi should be producing what they call renewable crude, a drop-in hydrocarbon molecule that KiOR further processes to produce fungible gasoline and diesel components that drop-in to the existing petroleum transportation fuel infrastructure. While ethanol, regardless of its source, requires blender pumps and faces blending limits, gasoline and diesel from renewable crude has a host of potential homes and no limits. Kior isn't the first to make a drop-in biofuel commercially, though they will be the largest. What they won't be is the last.
"An overwhelming number of our 51 members are making drop-in molecules that don't require blender’s pumps," said McAdams. "These are hydrocarbon molecules that behave exactly as if they came from a barrel of oil. They are fungible biofuels that can be mutually exchanged in gasoline, diesel or jet fuel."
The efficacy of drop-in biofuels was recently demonstrated by the U.S. Navy off the coast of Hawaii. McAdams, representing the industry, was on board the USS Nimitz as a squadron of Navy jets took off, burning 50/50 biofuel based jet fuel.
"When they landed, the pilots were debriefed," recalled McAdams. "They told us the planes flew great, and they wouldn't be using the fuel if they didn't believe in it."
If the end product is equivalent to petroleum-based products, so, is the process for making it equivalent? Kior uses a proprietary process called Biomass Fluid Catalytic Cracking to convert biomass directly into a combination of renewable crude, water, light gasses and coke. Once separated, the renewable crude is refined into the desired product—gasoline, diesel, jet fuel or other. The gasses are burned to generate electricity.
The process is "feedstock flexible" and can utilize a wide range of biomass materials. However, the location of the Mississippi plant is intended to utilize woody biomass, in this case, Southern Yellow Pine. The USDA Forest Service estimates enough surplus pine exists, beyond what is harvested each day for other uses, to supply 35 Kior-style plants using 1,500 dry tons per day. Best of all, pine is unlike other energy sources, such as corn, sugar, soy oil and even crude oil, which have fluctuated wildly in price over the past 12 years. Instead, its price has risen only slightly in that time period, giving Kior a feedstock in wide cultivation and available at a long-term stable price.
ADJUSTING TO HIGH CORN PRICES
Finding a stabler priced source of feedstock is the goal of many in the grain-based ethanol industry. Although most are focusing on post harvest corn biomass or corn stover, one is focusing on fiber in the grain. Quad County Corn Processors (QCCP) plans to be producing cellulosic ethanol along with its starch-based ethanol by fall of 2013. The change is going to make adjusting to higher corn prices easier, initially for QCCP and eventually for other corn processors.
Thanks to a breakthrough in the fermentation process discovered by company engineer Travis Brotherson, ethanol production will increase by at least 6 percent and as much as 10 percent. Corn oil yield will more than triple from 0.5 lbs. per bushel to 1.6 lbs. per bushel.
The only downside is that co-product tonnage, today known as distiller grains, will decrease by about 15 percent. On the plus side, the new co-product becomes a high-protein, low-fiber feed product that can be used in ruminant diets and is expected to be much more digestible by pigs, poultry and other monogastric animals. Brotherson expects demand will rise for the new byproduct as livestock producers get experience with it, much as happened with distillers grains. He also expects demand to rise for the process.
"We will work on building the system here and letting people see the results," said Brotherson. "In the near time frame, we will be talking to other plants. Our plan is to commercialize it at other facilities in the future."
BANKING ON RFS
While cellulosic biofuel feedstocks and processing technologies differ across the board, one thing unites the advanced biofuels industry and the traditional grain-based industry. "The RFS is the keystone for where we are right now," said McAdams. "It is eminently important that it stay in place and that the federal government send a strong signal of support for it."
He pointed to the billions of dollars being invested by private industry, as well as the grants, loans and loan guarantees already made by the U.S. government. The American Recovery and Reinvestment Act funded $800 million for advanced biofuels. As a result of those funds, private investors and creative new technologies, McAdams suggested that the country is well on its way to greater energy security, though there is a considerable way to go.
"It's like we're in the second quarter of the game," said McAdams. "It's kind of hard if the rules are changed before we even reach the middle of the game."
Leong agreed with McAdams, even though he pointed out there is a differentiation between corn-based biofuel and other feedstock-based biofuels. "Our position and that of a lot of others is that it isn't appropriate to touch the RFS," said Leong. "It has served the country well, and it is a policy that is important to our industry."