Surface-to-air: How Vertimass might shatter conventional yields in alcohol-to-jet fuels

Saturated E10 ethanol markets; unmet demand in aviation biofuels: can Vertimass’ technology provide the bridge?

So there’s this idea in aviation biofuels called alcohol to jet, and it’s conceptually powerful.

Behind it is the idea that the E10 ethanol market in the US is right at the saturation point, there’s excess production capacity available — meanwhile there’s strong demand out of the aviation sector for an advanced biofuel. So, why not convert alcohols to jet fuel?

And, from a chemical point of view, there’s no reason why not. After all, if you dehydrate ethanol (that is, remove the water, H2O), what you have is ethylene, a hydrocarbon. And you are the road to a longer-chain range of molecules such as kerosene — and there are existing chemistries to make that transformation.

Byogy has been developing one of these — a four-step process of dehydration, oligomerization, and hydrogenation that has picked up some heavyweight airline interest.

Another technology has emerged in recent months. A catalytic process developed originally at Oak Ridge, that also dehydrates ethanol — but instead of producing pure ethylene, it converts ethanol in one step to a range of diesel and jet molecules, with only about 3% ethylene content in that step.

This is Vertimass.

Why’s that significant?

Well, here’s the problem of converting ethanol to jet. Most processes out there, we have been advised, require 2-2.5 ethanol molecules to produce a jet fuel molecule.

Ultimately, they’ve run into what Aemetis CEO Eric McAfee once described to me as the immutable “Natural Law of Alternative Commodity Markets”. NLACM states that “the value of any intermediate products produced in any process must be significantly exceeded by the value of the end product, or the end product will not be produced.” We looked at this in The Solyndra Effect, or why alcohol-to-jet fuel is a tough sell, here.

Consider the problem with ethanol. You produce 2.5 gallons worth $5.25 (assuming ethanol at $2.10 per gallon). You then convert ethanol molecules in a reaction that makes about 1 molecule of jet fuel, and you have $3.50 in value in the form of a gallon of jet fuel.

So, how it Vertimass different?

In this case, because they use a direct conversion process. Early-stage results out of the Vertimass labs and Oak Ridge suggest an average of 1.6 molecules of ethanol, to 1 molecule of diesel, jet or gasoline.

Let’s run that through the same math we used above to illustrate NLACM. You produce 1.6 gallons of ethanol worth $3.36 (assuming ethanol at $2.10 per gallon). You then convert ethanol molecules in a reaction that makes about 1 molecule of jet fuel, and you have $3.50 in value in the form of a gallon of jet fuel. In this case, the conversion adds value — as well as unlocking a market, which is the point with all ATJ fuels.

Why is Vertimass different?

CEO Charles Wyman explains: “The key is that the catalytic reaction removes water from the ethanol molecule to produce a variety of hydrocarbons that retain all the carbon plus the hydrogen not taken out with the water during the reaction without adding hydrogen.  Thus, in simple terms, we could view this as C2H4(H2O) > C2H4 + H2O.

“However, the catalyst forms very little ethylene (~3%) but instead converts most of the ethanol into a variety of aromatics, alkanes, and alkenes that give this overall stoichiometry.  As a result, the maximum mass yield of hydrocarbon fuels is 28/46 x100 = 60.9%.  The volume ratio of ethanol input to hydrocarbon output depends on the mass density of the product vs. ethanol but should be about 1.6 volumes of ethanol/volume of hydrocarbon fuel on average for diesel, gasoline, and jet.

“Although some may be concerned with the loss of volume, it is important to remember that because the reaction is only slightly exothermic, no hydrogen or other magic ingredients are added, and water has no heating value, the hydrocarbons produced contain most of the energy from the ethanol but in a more compact molecule better suited to jet and diesel applications.  This result is consistent with the first law of thermodynamics.  Furthermore, for fuels, the key objective is to preserve the energy of the reactants in the products, while loss of mass can enhance the energy density as is vital for jet and diesel.  Overall, I don’t believe that there is a lower cost process for making fungible hydrocarbon fuels from biomass.”

What are the differentiating factors?

According to the company. “The process benefits from 1) single step conversion of ethanol into a hydrocarbon blend stock with high yields, 2) no hydrogen addition, 3) production of minimal amounts of light gases, 4) operation at relatively low temperature and atmospheric pressure, 5) ability to process 5 to 100% ethanol concentrations, 6) product flexibility to respond to changing market demands, and 7) catalyst durability.”

Where did Vertimass come from?

Wyman explains: “Through a competitive process that was completed early this year, Vertimass obtained the exclusive worldwide license to novel catalyst technology developed at Oak Ridge National Laboratory through DOE support for simple one step conversion of ethanol into hydrocarbon blend stocks that are fungible with our current transportation fuel infrastructure without hydrogen addition.

The team

The team is led by Bill Shopoff (Chairman), Charles Wyman PhD (President and CEO), John Hannon PhD (COO), Tom Mullen (EVP), Chaitanya Narula PhD (catalyst chemist), Brian Davison PhD (technology development), Martin Keller PhD (board member), and Sandra Sciutto CPA (CFO), along with an experienced team of consultants with expertise in catalysis, ethanol production, fuels, and scale up.

Where is the company in the path to scale?

Early. They’re now now working with potential strategic partners, catalyst manufacturers, engineering and construction firms, markets, and others to develop a platform from which to launch commercialization within 2 years.

How does the technology relate to ethanol infrastructure?

It’s bolt-on. Here’s a diagram that shows the basic approach.

What’s going on now?

Well, there’s a process for a lab. Now, comes what BP Biofuels chief Phil New once called “the hard yards of commercialization,” and specifically in this stage is to accumulate enough data to support the commercial design process. Over the next 24 months, Vertimass is working with an (as yet undisclosed) “major” engineering firm toward this end.

What about catalyst failure? We’ve seen that elsewhere.

In these catalytic technologies, much of it comes down to the reactivity, selectivity and longevity of the catalyst. Where’s the company in that?

“With all catalysts, the proof is in the pudding,” said Wyman. “Oak Ridge has run it for long periods. The catalyst stands up and can regenerate.”

How is this different from other companies that have experienced problems with catalysts, specifically lifespan?

“When you are dealing with mixed liquid streams, the catalyst some times can’t take the abuse,” Wyman said. “In this process, you have a distillation column where you pull out impurities; there no solids or ash. It could go 6 months to a year before replacement.”

What about a go-to-market product?

Not easy these days to finance a plant at sufficient scale to make affordable jet fuel, diesel or gasoline, when the company is at early stage — even strategics can find it daunting.

“There’s a fair amount of BTX in there, and you can get pretty substantial value for those molecules. Plus, you have less of a stringent testing procedure than you have with, say, aviation fuels — because, as one executive put it in aviation, “if you have engine trouble you can’t park it on a cloud.”

Where’s Vertimass in its financing history?

Also early-stage. They’re out raising capital right now, in the $5-$8 million range, to fund the next 24 months of development.

The Digest’s Take

A long road top proving out the business case, but the appeal is obvious: opening up new markets with a cost-advantaged molecule and a process not in need of hydrogen, fossil or otherwise. Aimed at what is a virtually bottomless pool of demand from the aviation sector.

Virtually no feedstock risk, given the proven supply and the bolt-on approach; less policy risk, since aviation biofuels is demand-driven not mandate-driven. Adoption risk, if the economics work, is zero. Got a nice potential go-to market molecule complex in BTX. Nice alternatives in renewable gasoline and diesel. No hydrogen dependency.

There’s technology risk, no doubt about it — there’s no proof yet this will work at scale. Investors that are willing to take technology risk are required. There’s a low cost of discovery here. Interesting path that adds allure to the already intriguing ATJ sector.

More on the story.