Beta Renewables: Biofuels Digest’s 2015 5-Minute Guide

Beta Renewables — a subsidiary of Chemtex, and Grupo M&G — has developed and deployed a low-cost cellulosic biofuels technology, known as PROESA. Chemtex employs approximately 1000 staff located in key centers throughout the world – Tortona and Rivalta in Italy, Wilmington, NC and Sharon Center, OH in the USA, Shanghai and Beijing in China and Mumbai, Bangalore and Baroda in India.

Chemtex is a full service project solution provider that offers state-of-the-art technologies (licensed and own), technology development (from its R&D facilities in the USA and Italy) and a complete range of project management, engineering, strategic sourcing and construction services for its clients throughout the world.

Major Investors

Gruppo Mossi & Ghisolfi (“M&G”) is presently the world’s largest producer of PET for packaging applications with 1.7 million ton of capacity annually. M&G is also a technological leader in the polyester market. Group sales proceeds in 2008 were almost $2.6B. The group has manufacturing assets in Brazil, Italy, Mexico and USA and supports three R&D facilities in Rivalta, Italy; Sharon Center, Ohio; and in Poços de Caldas, Brazil.

Technology

Biomass pretreatment and hydrolysis, for which 11 patents applications have been filed, for transforming cellulosic feedstocks into sugar for conversion into ethanol and/or bio- based chemicals.

Feedstocks

PROESA technology has the capability to use a wide variety of feedstocks. Successful testing has been completed for a number of different energy crops (Arundo Donax, Miscanthus, Fiber Sorghum and Switchgrass) and biomasses including corn stover, rice husk and straw (wheat and barley).

Fuel Type

The PROESA platform includes an integrated solution for ethanol and power production. The sugars produced from the PROESA pretreatment and hydrolysis process can be also be converted to renewable diesel and a range of bio-based chemicals using the bio-technology of third parties.

Fuel Cost

Based on pilot plant results, and backed by extensive agronomic studies, the PROESA solution is expected to produce ethanol that is competitive to commercial grade fossil fuels based on an oil price of USD 50-70/bbl. For bio-based chemicals, the PROESA pretreatment technology is expected to be capable of producing fermentable sugars at approximately 50-60% of the cost of market sucrose.

Co-products: The PROESA ethanol platform can also provide power, based on the burning of lignin, as a co-product for national grids.

The Situation

Beta is getting down the road, taking a “first-mover” advantage stemming from getting its first commercial plant mechanically complete in 2012, and signing a large number of deals. It’s key advantages? One, that the number of “players” who have been able to construct a first commercial is small. Second, low capex.

How does low capex come about?

As CEO Guido Ghisolfi told The Digest: “One of the first consequential decisions that has to be made in a system is what is accepted in the feedstock. For example, bale size, You have round bales, square bale, even small bales. It costs an additional $15-$20 million to handle “any size of bale”. And there’s a cost in obtaining “good clean biomass”, too. Nothing that comes off an agricultural field is going to come in without rocks and dirt, so another decision is how much you wash, and how you do it. With cleaner biomass, you spend less energy processing rocks and dirt — so there’s a trade-off between investing more to clean it, or spending more later on to work with a less pure feedstock. We finally concluded that it was better to add a new intensive washing step, which we are implementing right now in Crescentino.

The next decision — and it changes the rest of the life of the plant, forever, is the decision to have pressure or no pressure in the process. Pressure costs. But you have to have something with which yo are attacking the biomass in the pretreatment. So, you generally have pressure, or you are adding chemicals. And that’s a serious decision. Do you use chemicals, or not? With chemicals, you can get higher yields. For example, there are competitive technologies available that use 4.3 – 4.4 tons of biomass to get a ton of ethanol. We have 5 tons of biomass to a ton of ethanol. But it is more than a question of yield. The question is do you get enough advantage in not running with chemicals to offset the advantages of the higher yield? It is a question of metallurgy — the kind of metals you can work with, the kind of steel you can have, the kind of design you need if you are using chemicals. Our conclusion was that it was better not to have chemicals.

Top Past Milestones

In November 2014, Brooke Renewables and Hock Lee Group presented a Letter of Intent to the Sarawak State Government marking their intention to invest in the 2G Bioethanol and Bio chemical plant as the first phase of the $1B, 5-year Sarawak Biomass Hub project.

The tri-party LOI signed is for the use of Beta Renewables’ Biomass Conversion Technology and Novozymes’ Exclusive Enzymes Solutions in the 1st 2G Bioethanol and Biochemical plant in Brooke Renewables’ proposed Sarawak Biomass Hub project. The LOI strengthens the execution of the proposed Biomass Hub project in Sarawak, as both foreign partners are global leaders that have proven commercial-scale facilities. Beta Renewables are owners for the world’s first commercial scale 2G Bioethanol Plant in Italy and Novozymes is the world’s largest enzyme solutions provider.

In October 2014, Biochemtex and Beta Renewables announced an agreement with Energochemica SE for the construction of a 16.5 million gallon (55,000 ton per year) cellulosic ethanol plant. The plant, which will be constructed in Strazske, Slovak Republic, will also generate power and steam. The project is commencing immediately and the start-up of the plant is anticipated for the first half of 2017. The plant will utilize non-food biomass as its feedstock and is expected to deliver “cost-competitive ethanol” according to the project sponsors.

In September 2014, GranBio initiated production at the first commercial-scale plant for second-generation ethanol in the Southern Hemisphere.  The Bioflex 1, unit built in São Miguel dos Campos, Alagoas, has an initial production capacity of 82 million liters of ethanol per year (21.6 million US gallons)

GranBio invested US$190 million to build the plant and US$75 million on the steam and electricity co-generation system, the latter investment along with the Carlos Lyra Group’s Caeté facility.  GranBio’s facility uses the PROESA pre-treatment technology from the Italian company BetaRenewables (a company in the M&G Group), enzymes from Novozymes in Denmark, and yeast from DSM in Holland.

In July 2014,  M&G Chemicals announced that its wholly owned subsidiary M&G International S.à.r.l has entered into a Sino-foreign joint venture with Anhui Guozhen CO, Ltd. The company – Anhui M&G Guozhen Green Refinery CO, Ltd – will employ PROESA technology licensed by Beta Renewables to convert 970,000-1,300,000 metric tons per year of agricultural residues into cellulosic ethanol, glycols and by-products such as lignin in Fuyang City (Anhui Province, PRC). The biomass will be supplied by Guozhen under a long term fixed price agreement, and the enzymes needed for the conversion of the biomass will be supplied by Novozymes as earlier announced.

In July 2013, Chemtex and Murphy Brown signed a long term agreement for the supply of purpose grown energy crops and residues to be used as cellulosic feedstock in Project Alpha, Chemtex’s Cellulosic Ethanol facility planned for Clinton, North Carolina. The agreement covers a number of feedstocks to be grown on approximately six thousand acres of land owned or controlled by Murphy Brown. The proposed crops will be grown on acreage that is not typically used for grain production and will represent the backbone of the supply chain for the planned Chemtex biorefinery. Final execution of the agreement is contingent upon achieving financial closure for the project. Project Alpha will produce twenty million gallons of environmentally friendlier cellulosic ethanol annually using Beta Renewables’ PROESA Technology.

In June 2013, In Italy, following the commissioning and start-up of its 20 million gallon per year cellulosic biofuels plant in Crescentino, Italy, Beta Renewables commenced shipping cellulosic ethanol in commercial quantities.

In Q4, 2012, the company started up at the 20 million gallon PROESA Demonstration Plant in Cresentino, Italy

Future Milestones

Start up of an integrated Biorefinery in the USA utilizing PROESA as the core technology.

Additional international project development agreements.

Business Model

Full project solutions (license and EPC services) to both ethanol producers (existing or new) and bio-based chemical producers and/or their licensees.

Competitive Edge

The PROESA solution is backed-up by extensive agronomic research into crop yields and crop management. Preferred biomasses (yielding up to 50 tons per hectare of usable feedstock on dry matter basis or 12 tons per hectare of ethanol) have been identified and tested and their associated logistic issues (harvesting, handling, etc.), are factored into the PROESA solution.

Key features of the technology include:

• Although yields may slightly differ, PROESA Technology has the capability to use a large variety of biomass as collected (without further processing).

• A unique pre-treatment and hydrolysis process that produces a high yield of quality and low cost sugar from cellulosic biomass for conversion to ethanol and/or bio-based chemicals.

• High efficiency in viscosity reduction enzymatic hydrolysis.

• Simultaneous fermentation of C5 and C6 sugars.

• Energy integration with high efficiency burning of lignin.

Distribution, Research, Marketing or Production Partnerships or Alliances.

Beta will be the provider of the technology and will implement projects for interested licensees of the technology.

Current alliances include the agreement to jointly market the PROESA technology and Novozymes enzymes.

In addition the company has an agreement with Amyris to integrate PROESA lignocellulosic technology into their platform to produce renewable fuels and chemicals.

Chemtex has also been awarded with substantial contributions (40 million USD) by European Institutions as co-sharing / support for the Research and Development program.

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