Frugal Fuels: Top 12 ways to transform biofuels using materials already around us

REduce, REuse, REcycle. REnewable energy sometimes means REthinking, REfocusing.

Great ideas abound for new feedstocks, and novel infrastructure. We admire so many of them. Jatropha, carinata, switchgrass, sweet sorghum, blender pumps, systems-at-sea. And so much more.

But what about technologies that bolt-on a different processing unit, but keeps everything else the same. Or uses an abundant, odious and low cost feedstock?

That’s a frugal fuel. In these nefarious economic times, why not make do with what’s already in place?

Here are our Top 12 ways to transform biofuels using materials – usually waste by-products, or lower-value materials – already around us?

12. Glycerine.

There’s a small market for glycerin as a building block material, but it has been overwhelmed by the supply coming from some biodiesel operators who have been producing a pure enough glycerine for sale into the industrial glycerin market – many biodiesel operators haven’t been able to produce it at sufficient purity and it has been distributed at very little value into the feed market, or even landfilled.

Then, along come numerous technologies aimed at converting glycerine from a low-value product into a high-value target material, such as isoprene (the main ingredient in synthetic rubber).

In Spain, Universitat Juame researchers have developed a process to turn biodiesel waste into yet more valuable products.  Any industrial process produces waste – including biodiesel.  One such product is glycerine.  The UJI Organic Synthesis research group has demonstrated a process to turn glycerine into glycerol carbonate which is used for processes involved in a range of products from cosmetics to plastics.

Then, there’s GlycosBio – they’ve set up shop in Malaysia to produce Bio-SIM (Bio-based Synthetic Isoprene Monomer), a specialty chemical that is in short supply globally with cost and yield advantages over petroleum based Isoprene and Isoprene from sugar based feedstocks.

 

11. Milo and biogas.

Biogas is everywhere – biomethane is something that a lot of farmers are looking into using, after aggregating from animal wastes on the farm. But the value is low, if simply burned to generate power, and the economics are tough. Along come companies like Aemetis who have combined biogas with a switch from US corn to Argentine milo. As of Q4 2012, import costs for grain sorghum from Argentina – feasible for ethanol plants with access to deepwater ports – is running $0.90 per bushel less than corn.

A reference (100 million gallon) ethanol plant would require around 36 million bushels of sorghum, at full capacity. Savings vs corn? $33 million, or $0.33 per gallon.

To qualify as an advanced biofuel, fuels have to be made from qualifying feedstocks and achieve a 50% reduction in greenhouse gas emissions compared to conventional fuels. To date, with next-gen capacity just now being built, the winners in qualifying for Advanced Biofuels RIN’s have been biodiesel plants and imported Brazilian ethanol.

Now, those RINs are worth $0.40 each, compared to a nominal $0.03 for a corn ethanol RIN in a normal market (there’s been some disruption there in the past 8 months, but historically this has been the value). For a reference sized (100 million gallon) ethanol plant, the difference in value is around $37 million, or $0.37 per gallon. Now, biogas as we said isn’t cheap, but for the reference plant in our example, the net benefit is currently at $57 million per plant, per year — pure operating cash flow. Or $0.57 per gallon.

10. Using waste CO2 for bolt-on algae – BioProcess Algae

In the Digest’s Biorefinery Project of the Future series we wrote about why corn ethanol plants were great places to begin developing an advanced biofuels. We noted that “existing first-generation fermentation biofuels require no re-invention of feedstock systems, no exotic first-of-kind processing technology, no fuel certification or from-scratch market development. They are financeable.”

For that reason, we sure love a technology that can utilize waste CO2 streams from ethanol plants, Bringing us to the BioProcess Algae project, which is advancing from a small pilot system to a 5-acre demonstration including all components systems that lead from CO2 capture through algae growth, harvest, and extraction.

Two things are especially notable about the project. First, it has proven that it can successfully utilize excess CO2 and process heat from the Shenandoah ethanol plant to produce microalgae. Second, it has proven (at pilot scale) that its unique growth media can work – and this is an important breakthrough, because the company is growing microalgae out of solution, using a biofilm.

9. High FFA waste oils – REG

If there’s one key factor that drives value at Renewable Energy Group — the US leader in biodiesel production — it has been the way they embrace technology to open up additional feedstocks. That way, they can produce lower-cost biodiesel even when a given feedstock is in short supply or is available at ruinous costs (the biggest problem, often, with otherwise perfectly lovely soybean oils and rapeseed oils).

Look at some of the feedstocks that REG can use: algae, babassu, beef tallow, borage, camelina, canola, castor, choice white grease, coconut, coffee, distiller’s corn, Cuphea viscosissima, evening primrose, fish, hemp, high IV and low IV hepar, jatropha, jojoba, karanja, Lesquerella fendleri, linseed, Moringa oleifera, mustard, neem, palm, perilla seed, poultry fat, rice bran, soybean, stillingia, sunflower, tung, used cooking oil, and yellow grease.

Of all those, perhaps the most interesting are the fish extracts and yellow grease – often odious, and certainly difficult to work with materials – but using true wastes is truly frugal.

8. POET BPX – .1-.15 gallons per bushel

POET’s patented raw starch hydrolysis process, named BPX, converts starch to sugar with a proprietary blend of enzymes, while other ethanol producers use a jet cooker to break down starch with heat. BPX reduces energy use in the plant by 8 to 15% and increases yield by 0.10 to 0.15 gallons per bushel. The technology is now deployed in 24 of POET’s biorefineries. Net impact on costs is huge – but, also, think of how frugal the impact on corn usage. Why, across the entire US corn ethanol capacity that could add as much as 800 million gallons of production without using up another kernel of corn.

7. Corn oil extraction – EdeniQ, GreenShift

GreenShift in many ways pioneered this market – why not extract valuable corn oil before processing grain into ethanol – and sell the resulting oil into, for example, the biodiesel market.

Then there was Primafuel, and ultimately Edeniq purchased that technology. In recent months, Aemetis and Pacific Ethanol have been among those joining the Edeniq bandwagon. Both will install Edeniq’s proprietary Cellunators to boost ethanol yields, and will also deploy Edeniq’s patented OilPlus corn oil extraction process to increase corn oil recovery (Edeniq’s Cellunator technology produces sugars by milling corn and other plant materials into “right-sized” particles of feedstock that can be more easily converted – boosting yields in a different way that POET’s BPX technology, but in its own way just as interesting.)

6. E85 direct

Rather than changing the raw materials,m what about using the existing network of flex-fuel vehicles and E85 pumps to break down the US ethanol blend wall? Cost of E85 has been the major barrier.

We’ve been writing this week about a remarkable effort by Absolute Energy to offer E85 directly to retailers at $1.93 per gallon. Overall, it’s a savings of 11 cents per gallon (in true energy density terms) for straight unleaded gasoline compared to E85. For cars that require premium gasoline – for which E85 is a perfectly acceptable substitute as it provides 100 octane fuel – the savings will be, on average, some 32 cents per gallon higher.

Due to limited distribution of flex-fuel vehicles and pumps, E85 should be seen as a fuel option that extends the blend wall, rather than solving it. Even if every flex-fuel enabled car switched exclusively to E85 ethanol — and there are practical limits on the availability of pumps — the blend wall would be extended by 4.1 billion gallons (the difference between E10 and E85 ethanol gallonage, based on an average of 500 gallons per car per year). But offering better fuel economy, in cost per mile, will go a long ways towards making E85, at last, a reality.

5. Bolt-on cellulosic sugars

Low-cost sugars are the rage. Renmatix is hot, Proterro too.

Then there’s Sweetwater Energy, that is opening a side door into cellulosic ethanol. Costs you very little up front, payback is quick, and the risk is going to be generally borne by the cellulosic feedstock supplier. Who also assumes the responsibility for building, owning and operating the facility supplying feedstock to you. All you do is ferment cellulosic sugars mixed in with the corn mash, in blends (eventually) of up to 50 percent.

That’s the shape of the deal that emerged between Wisconsin’s Ace Ethanol and New York’s Sweetwater Energy. Sweetwater, for its part, will build, own and operate a cellulosic sugars facility dedicated to supplying cellulosic feedstock to Ace Ethanol. Ace will mix the sugars in with its corn mash, and produce ethanol.

The initial project delivers enough refined monomeric sugar for Ace to produce up to 3.6 million gallons of cellulosic ethanol per year. It’s a 16-year deal for this phase of the relationship, with a total deal value of up to $100 million – or around $1.73 per gallon of ethanol.

Advantages? Ace was buying corn from outside of its natural draw area from other elevators — that’s where corn prices spike into those $7 price ranges seen on CBOT screens. This technology makes it possible to replace expensive, last-bushel corn with cellulosics. Keep in mind, the cellulosic biofuel waiver credit ran $0.78 per gallon, a sharp increase over $0.05 corn ethanol RINs. Also, there’s the $1.01 per gallon cellulosic biofuels tax credit, just extended for 2013 – and may be available in 2014 and beyond.

4. Isobutanol from dextrose

If there’s one technology we’re all waiting for, it’s the arrival, at scale, of isobutanol – a higher value fuel and chemical blendstock made from the same feedstock and at the same locations as corn ethanol, if you’re using Butamax or Gevo technology. (There’s also n-butanol made from cellulosic feedstocks if you are teamed up with Cobalt or Green Biologics).

Gevo, Butamax, and Green Biologics are working on these opportunities – though Butamax and Gevo have been more active to date with the US corn ethanol fleet. The opportunity? Take the same corn ethanol feedstock stream, add a relatively low-impact unit for biobutanol production, and produce a $4 molecule instead of a $2 molecule. Payback, say the technology developers, can come within three years.

3. Carbon monoxide.

How about taking something not only odious but downright dangerous – carbon monoxide. Not something you might sequester, but a must-do. Now, make something of it.

That’s what LanzaTech and Baosteel are up to in China, where their jointly-owned 100,000 gallon per year (300 tons) demonstration plant, located at a Baosteel steel mills outside Shanghai, China has met and exceeded milestones – the companies are reporting that the plant achieved higher productivity than design. The Shanghai Baosteel LanzaTech New Energy Co., Ltd, established through a joint venture in March 2011, was created to commercialize LanzaTech’s technology in China. Unconditioned steel mill off gases, rich in carbon monoxide (CO) are channelled from the operating steel mill into a LanzaTech bioreactor, producing ethanol.

“Taking something like steel mills gas and converting to a usable product,” LanzaTech CEO Jennifer Holmgren told the Digest, “the bio guys out there look at our plant in shock and the steel mill guys out there do the same thing. Few ever really imagined this was possible and at 100,000 gallons – it is a big plant and looks the part.  New reactor, new microbe, new technology concept…  and it works!”

How much steel waste gas is there? According to LanzaTech, enough to make as much as 31 billion gallons of ethanol. Wow. More on LanzaTech here.

2. Sugarcane bagasse.

Bagasse has a lot going for it. For one, it’s already aggregated at the ethanol plant — used in a low-value way, now, burned to generate power for the ethanol operation and to sell into the grid. There’s going to be an awful lot of activity with bagasse as it becomes a feedstock in higher-value processing technologies that make fuels and chemicals.

How on the trail here? Think GranBio. They’ve just completed the financing round for Brazil’s first commercial scale second generation ethanol plant. The company’s subsidiary, Bioflex Agroindustrial, received a $149 million loan from BNDES, Brazil’s National Social and Economic Development Bank. The project will use Beta Renewables’s technology for the 22 mgy bagasse and sugarcane crop residue plant. The BNDES is funding this project with the PAISS program, which recently approved 2 billion reais for projects developing cellulosic ethanol and chemical products from sugarcane bagasse.

1. MSW – Enerkem, INEOS, Fulcrum, Solena

Whether it is landing a key military biofuels contract from the DoD, as Fulcrum did this week – or bringing energy freedom to Vero Beach, FL, as INEOS Bio is doing right now in commissioning their first plant there now. It’s all transformative, primarily because it is an already aggregated, must-get-rid-of, negative cost feedstock. Good old MSW. There are lots of players – here are four getting traction:

Fulcrum BioEnergy. Here’s Fulcrum BioEnergy: The Digest Interview. How they landed a big military contract to produce drop-in diesel and jet fuels to military spec.

INEOS Bio. How they are transforming the sleepy resort and agricultural town of Vero Beach, FL into something that no city in Florida has ever been before – a net exporter of transportation fuels. A little Saudi Arabia along the central Florida coast.

Enerkem. Or, what about Enerkem? The company’s first commercial plant in Edmonton is “progressing well”, with “prefabricated modules now being delivered, and 28 employees onsite full-time.” The 10 million gallon (per year) Edmonton plant is expected to be at full ethanol production capacity in 2015. And, two weeks ago, Enerkem revealed that the Canadian government will contribute $1.1 million to a project developing new catalytic processes for the conversion of waste into “drop-in” biofuels.

And then there’s jet fuel from Solena. Just last December, British Airways committed to a 10-year, $500 million offtake agreement with the GreenSky London facility, and permitting is now underway for construction in East London. GreenSky London — a joint development between British Airways and Solena — will convert around 500K tonnes of locally-sourced waste into 50,000 tonnes of sustainable aviation biofuel and 50,000 tonnes of bionaphtha and biodiesel. The facility will also have a renewable power generating capacity of 40 MW. More about that here.