POET-DSM: Biofuels Digest’s 2015 5-Minute Guide

February 10, 2015 |

5-Minute-Guide-logoPOET-DSM Advanced Biofuels is a 50/50 joint venture between Royal DSM and POET, LLC. Based in Sioux Falls, South Dakota, the company is a cooperative effort of two innovators that provides a key to unlocking the opportunity of converting corn crop residue into cellulosic bio-ethanol. Built on the strengths of both companies, the joint venture has a critical mission: to make cellulosic bio-ethanol competitive with corn bio-ethanol, the most competitive renewable liquid transportation fuel on the US market today.

Drawing on the deep expertise and experience of POET and DSM in different areas of converting cellulosic biomass into bio-ethanol, POET–DSM Advanced Biofuels has its first commercial-scale plant co-located with POET Biorefining — Emmetsburg in Emmetsburg, Iowa. Based on this plant, the JV plans to globally license an integrated technology package for the conversion of corn crop residue to cellulosic bio-ethanol.

Rankings

50 Hottest Companies in Bioenergy, #7, 2014-15

Biofuels Digest Awards: 2013 Industrial Symbiosis

The Situation

Symbiosis — you might call it a “bolt-on” strategy, or “co-location”. Unlocking the power of symbiosis is what led us to conclude in our 10 Part Bioenergy project of the Future series: “First, start with an ethanol plant.”

That’s what POET-DSM has done in Emmetsburg, Iowa. It’s a traditional corn ethanol plant with a cellulosic bolt-on, that boosts overall capacity by 20 percent. Known as Project LIBERTY, it will produce 20 million gallons of cellulosic biofuel per year – later ramping up to 25 million gallons – from corn cobs, leaves, husk and some stalk. Commissioning for select parts of the process is scheduled to begin in January.

When it reaches full capacity and steady-state operations, the facility will accept 300,000 tons of biomass, which according to POET’s released figures could be sustainably harvested from a 468 square-mile area. By contrast, a 100 Mgy corn ethanol plant can be sustained by a 325 square-mile area using POET’s process.

“Removing approximately one ton of biomass out of the average 4.26 tons available per acre,” POET-DSM said in a release, “will not require any drastic changes in fertilizer management for producers choosing to participate in the program.

According to DSM, the joint venture is expected to be profitable in the first full year of production and to deliver substantial revenues with above-average EBITDA contribution in the medium/longer term.

Profiles

Profiled in: 12 Bellwether Biofuels Projects for 2013

Featured in: POET-DSM reports key technology, process purchase for commercial cellulosic bio-ethanol

Type of Technology: Cellulosic ethanol conversion (enzymatic hydrolysis), Grain ethanol conversion (raw starch hydrolysis – BPX cold-cook process)

Feedstocks: corn stover

Products: cellulosic ethanol, lignin

Offtake partners: Ethanol is marketed by POET Ethanol Products.

Past Milestones:

In February 2015, POET-DSM Advanced Biofuels announced that Dan Cummings was appinted as the JV’s first president. Cummings joins POET-DSM after serving as President and Director of INEOS New Planet BioEnergy, and as global Vice President of Commercial and External Affairs for INEOS Bio. Previously he held senior business, corporate and legal positions at INEOS and BP.

Cummings will oversee day-to-day operations of POET-DSM, represent the joint venture publicly, and coordinate functions between the parent companies. He will also act as the central point of contact for external relations, which includes all technology licensing activities for POET-DSM worldwide.

In December 2014, the Finnish government granted EUR30 million to Bioethanol Finland to support the development of the company’s 90 million liter per year cellulosic ethanol plant. The facility will produce fuel from straw. Poet-DSM Advanced Biofuels is collaborating with the plant to utilize the company’s technology. The government also granted Neste Oil EUR3.3 million for an add-on facility that will produce biofuel from tall oil pitch.

In September 2014, POET-DSM’s Emmetsburg commercial cellulosic bioethanol plant opened for business. Project LIBERTY will produce up to 20 million gallons. The project includes the refinery, and a 22-acre biomass stackyard.

In January 2012, Poet teamed with Royal DSM to create the 50/50 joint venture called Poet-DSM Advanced Biofuels that will produce cellulosic ethanol and license the technology to other plants in the U.S. and globally. DSM and POET will each hold a 50% share in the joint venture, which will be headquartered in Sioux Falls, South Dakota. The initial capital expenditure by the joint venture in Project Liberty will amount to about $250 million.

With the announcement of the new JV, POET said that it would not utilize the loan guarantee it was awarded by the U.S. Department of Energy (DOE). POET received a commitment for a $105 million loan guarantee to finance Project LIBERTY on September 23, 2011. Upon the closing of the joint venture, POET will officially decline the guarantee prior to drawing any funds.

In April 2010, POET outlined its plans to produce up to 3.5 billion gallons of cellulosic ethanol by 2022 in a presentation at the National Press Club. CEO Jeff Broin confirmed that the POET will break ground on its 25 Mgy cellulosic ethanol facility in Emmetsburg, Iowa, by year end. The POET’s plan divides into three parts: 1 billion gallons through added capacity at POET’s existing network of 26 corn ethanol plants; 1.4 billion gallons through licensing of the POET technology to other existing corn ethanol producers; 1.1 billion gallons based on new feedstocks sourced through POET Biomass and through joint ventures, using wheat straw, switchgrass and municipal waste as feedstocks. The proposed added capacity would account for 20 percent of the cellulosic ethanol required by 2022 in the Renewable Fuel Standard.

Future Milestones

The JV will first focus on Poet’s Project Liberty facility in Emmetsburg, Iowa and will later implement the technology in the 26 other ethanol facilities in the company’s network. The joint venture is now marketing its LIBERTY Technology package to third parties for continued energy development.

Business Model:  owner-operator and system licensor

Competitive Edge: Vertically integrated system, large network of plants provides shared knowledge of process efficiencies, millions spent annually on research leads to breakthroughs each year in every step of the process

www.poetdsm.com

Print Friendly, PDF & Email

Tags:

Category: 5-Minute Guide

Thank you for visting the Digest.