Shatter the Blend Wall with High Performance Bio-gasoline

June 14, 2015 |
David Gogerty

David Gogerty

By David Gogerty and Ronan Rocle, Global Bioenergies, special to The Digest

In March, when the inaugural ‘AgSummit’ was held in Des Moines, it was more than just tires that were spinning their wheels in the mud of the spring thaws. The ethanol industry, after a period of government inaction and perceived blend wall issues, didn’t seem to gain traction in this pep rally for potential 2016 presidential candidates, which showed that support for the RFS is hardly a given in this election cycle. Add in the recent drop in crude oil prices, and renewables in general are looking for the next innovation that will move this industry forward.

And there are indeed interesting developments: using new synthetic biology techniques, we can now target the best-of-the-best in gasoline molecules—isooctane. This high-performance fuel, which is expected to be produced by fermentation at less than 2.14 $/gal and would be cheaper than gasoline with a RIN credit (see below), has also large advantages: 100 octane number, low vapor pressure, the ability to be blended at nearly any ratio, and no infrastructure (e.g. car engine or pipeline) problems. Here’s how the story of renewable isooctane can play out.

The isooctane story

Ronan Rocle

Ronan Rocle

Isooctane is currently produced in the United States via isobutene at about one million tons per year, and it is mostly used as a premium gasoline component in small amounts due to its higher price than gasoline and alkylate. Isooctane is currently derived from the dimerization of isobutene followed by hydrogenation. The purification from naphtha steam cracking begins with an extracted crude C4 stream. Butadiene is extracted from this crude C4 stream to produce raffinate-1—a mixture of isobutene and linear butenes. This mixture can feed a dimerization unit to produce isooctane, but only the isobutene reacts, leaving linear butenes as a by-product.

Another method to produce isooctane would be alkylation of isobutene by isobutane. However, getting pure isobutene from a mix of olefins, such as raffinate-1, is very expensive since the most convenient way is to convert the mixed isobutene into MTBE, then revert to pure isobutene and methanol. Consequently, pure isobutene is dedicated to chemical applications, and most alkylation plants use mixed olefins (a mix of propylene and butenes) to produce a mix of isooctane and other alkanes, called alkylate, with lower properties than isooctane.

Each of these additional steps results in isooctane and alkylate products that are, on average, 25% and 15% more costly than gasoline, respectively, with the big driver in isooctane price being the requirement for isobutene as part of the production process. This is where bio can have a large added value—bio-engineered microbes are great at producing specific products such as isobutene. Direct production of isobutene by fermentation has been reported by the company Global Bioenergies that is operating a pilot plant in France. Isobutene evaporates from the fermentation broth, leading to no toxicity for the microbe, and is then directly recovered as a pure product. Due to the relative simplicity of this process, renewable isobutene can be produced cost competitively compared to fossil-based pure isobutene, based on five year averages.

One could then envision the production of isobutene and the dimerization of isobutene into isooctane (via isooctene) for a 100% bio-based, renewable molecule. This could come to fruition scientifically, but the renewable industry has heard one key message loud and clear—customers only want renewable/sustainable products that are at or below fossil prices. Thus, a renewable company would find it difficult in today’s market dynamic to compete on price with gasoline when it would have to make two very pure bio-isobutene molecules and saturate the isooctene product with hydrogen to produce the isooctane.

Taking a page from oil refining

Instead, the renewable industry must take a page from oil refineries and instead combine one high-purity bio-isobutene monomer with the very cheap refinery product, butane. The two combined create an isooctane molecule that competes on cost with conventional isooctane, and the benefits of this process would go far beyond the wholesale price of isooctane. The molecule itself would have 50% renewable content, thus qualifying for a pro-rated RIN price that will add additional benefits to its economic feasibility. Even more substantial is the fact that a cost competitive bio-isooctane will allow refiners to blend higher isooctane amounts into their gasoline products. In doing so, they receive the benefit of a 100 RON (octane) fuel component with a vapor pressure much lower than ethanol, gasoline, and even alkylate. This vapor pressure value is critical, because by adding isooctane with a vapor pressure of 1.8 psi, one can blend gasoline with cheaper butanes that have a decent octane value (92) but a difficult vapor pressure (54 psi).

Typical share in Gasoline
FCC gasoline 30-50
Reformate 20-40
Alkylate 10
Isomerate 5
Butanes 5
LSR gasoline 3

 

Ethanol Gasoline Alkylate Isooctane
Vapor pressure (psi) 22.8 8 4.5 1.8

If we blend just 5% isooctane into gasoline, we can benefit on cost without losing any of the energy content or performance of the fuel. That’s because when we add the 5% isooctane, we can replace costly alkylates with less expensive components of conventional gasoline. It’s even better in California, because of stricter vapor pressure and fuel regulations. There, isooctane is used more extensively and enjoys a blend value premium of 40% compared to the rest of the US.

Now picture a Global Bioenergies facility in the United States producing 100,000 tons per year of renewable isobutene and combining this with 100,000 tons/yr of isobutane to produce 200,000 tons/yr isooctane. Such a facility using current corn-derived sugar would be expected to produce isooctane below $2.14/gal with current feedstock price (May 2015). This $2.14/gal value would become even more attractive when you consider the possibility for this fuel to be eligible to D6 RIN. Isooctane is composed of 50% bio-based feedstock but has a higher energy density than ethanol, thus 1 gallon of ethanol could be eligible for 0.81 RIN or about $0.62/gal based on last D6 RIN. Discounting the RIN credit, bio-isooctane could be sold below $1.52/gal, cheaper than gasoline, even in the low crude oil price environment of today (Brent at 67$/bl at the time of publication). Even without RIN credit, bio-isooctane would still compete with alkylate. Since alkylate accounts for 10% of the gasoline pool, this is still a significant market. Also, bio-isooctane will allow the industry to move beyond the current blending wall using existing automobile and pipeline infrastructure and without changing gasoline specifications.

May 2015 Price1($/gal) Blend wall Energy Density(BTU/gal) Vapor pressure (psi)2 Avg D6 RIN ($/gal) Price with RIN discount ($/gal)
Bio-Ethanol $1.59 10% 73.3 22.8 $0.76 Partly in the price ?
Gasoline $2.04 8 $0 $2.04
Alkylate3 $2.21 4.5 $0 $2.21
Bio-isooctane < $2.14 none 119.4(50% bio) 1.8 $0.623 < $1.52
1Prices refer to the advanced bioeconomy dashboard published in May 3, 2015. Cost of bio-isooctane was computed from corn price and isobutane price for the same period.1Vapor pressure defines volatility level of fuels. Lower volatility is associated with lower hydrocarbon emissions to air and is a property of premium fuel components.3Estimate based on a 15% premium on alkylate compared to gasoline (in $/ton) but corrected by the lower density of alkylate

3RIN pricing is based here on bio-based energy density on a BTU basis versus ethanol. Bio-ethanol contains 73,330 BTU/gal whereas isooctane contains 119,388 BTU/gal (50% bio-based).

For consumers at the pump

We can already see some indication of what this means for consumers at the pump. They will have the opportunity to purchase a sustainable, domestically produced fuel with identical hydrocarbon qualities as gasoline and higher performance. Higher technical properties also mean that lower quantities of premium components are needed to match the same quality. With a lower share of such premium components, the fuel will likely be sold at a discount of several percent. It could be compared to what we saw with the recent switch in 2014 from refineries using an 87 octane base stock down to an 85 octane base from which to blend. This resulted in an increase in the cost of ethanol-free gasoline fuels due to the requirement to blend back in higher purity premium gasoline in order to reach the required octane level.

Will the incumbent refining industry be interested in such technology? The answer is likely yes. The advanced process would produce a product with higher demand that could utilize cheaper refinery products. Additionally, with the switch from naphtha to ethane crackers, there are now isobutene consumers that have to transport the monomer significant distances for their processes. A biobased, on-demand process would alleviate this constrained supply.

The bottom line is that synthetic biology is now giving us the tools to make better, cheaper, and more desirable renewable fuels and chemicals. Companies like Global Bioenergies are pioneering processes to provide cheaper, sustainable petrochemicals that can produce isooctane. Ethanol has been a good biofuel, and it will remain the base of our biofuel industry going forward. However, to break through the blend wall and achieve wide acceptance for biofuels, isooctane is clearly the fuel to gain traction and move this industry forward.

 

 

Category: Top Stories, Thought Leadership

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