Cellulosic Ethanol is Dead
Cellulosic Ethanol is Dead! Long Live Biomass Gasification!
My thunder has been stolen. I have been kicking around a post in my head for the past couple of weeks. I just haven’t had time to get around to it, with the move and all. But this has been nagging away at me for a long time. My thinking goes something like this.
Cellulosic ethanol, and by that I mean cellulosic ethanol in the traditional mold of what Iogen has been working on for years – will never be commercially viable. How can I be so sure? For one, I have covered the logistical challenges here and here. These are not going away, and are serious barriers to commercialization. In brief, the cellulose content of biomass is accompanied by a lot of lignin, inorganics, etc. that won’t get converted in a standard fermentation process. But you still have to haul all of this biomass to the plant, convert the cellulose (and get a low concentration of ethanol for your efforts), and then get rid of a sopping wet mess of waste biomass. Sure, it can be burned – if you spend a lot of energy drying it first. Because of the very nature of the process, I don’t believe this challenge will be solved. (I know, I know. I just have to BELIEVE….)
A recent report – brought to my attention by this story in Gristmill (and e-mailed to me by 4 different readers) – says the same thing (and stole my thunder!):
Here are some excerpts of comments by Tom Philpott at Gristmill:
A quiet consensus seems to be forming among people you’d think would know the facts on the ground: cellulosic ethanol, touted as five years away from viability for decades now, may never be viable.
Now we get a new study (PDF) from a trio of ag economists at Iowa State University. For the record, the authors are conventional ag scholars firmly entrenched within the corporate-dominated research world described so well by Nancy Scola in her recent “Monsanto U.” post.
So it’s surprising to see these mainstream economists deliver such a dismal forecast for cellulosic ethanol.
They start by calculating that without the latest round of goodies — i.e., the fat “Renewable Fuel Standard” of the 2007 Energy Act — cellulosic ethanol (and biodiesel, too) would have withered away. In that scenario, corn ethanol would keep ramping up from the current level of about 7 billion gallons, pushed by high oil prices and the $0.51/gallon tax credit that’s existed for years.
The authors seriously doubt the cellulosic target can even come close to being met. They reckon that the mandate can inspire “rational” farmers and investors to churn out 4.5 billion gallons of cellulosic ethanol by 2022 — but there’s a catch. In order to reach even that level, the government will have to significantly jack up the tax credit awarded to mixers — from the current 51 cents to $1.55.
Also some excerpts directly from the report:
Competition for land ensures that providing an incentive to just one crop will increase equilibrium prices of all. Also, at pre-EISA subsidy levels, neither biodiesel nor switchgrass ethanol is commercially viable in the long run. In order for switchgrass ethanol to be commercially viable, it must receive a differential subsidy over that awarded to corn-based ethanol.
Since switchgrass competes for the same acres as corn, and corn-based ethanol is less expensive to produce, corn-based ethanol will always have a comparative advantage over switchgrass ethanol in the absence of a differential subsidy.
Corn and soybeans compete for the same acreage, so when energy prices are such that corn-based ethanol is stimulated, then the price of soybeans must also increase if the farmer is to continue to allocate some land to soybeans.
We calculate the subsidies required to stimulate biofuel production to the levels required by the EISA RFS. We find that subsidy levels are needed in the range of $0.22 to $0.78 per gallon for corn ethanol, $1.97 to $2.90 per gallon for biodiesel, and $1.55 to $2.11 for cellulosic ethanol.
I can hear the ethanol and corn lobbyists scrambling for a response that involves a character assassination.
What Will Work
However, there are a couple of variations on this that I think will be viable. One is a gasification process. A number of people have taken to calling this process cellulosic ethanol, which to me is unfortunate and confusing. I have explained the differences in Cellulosic Ethanol versus Biomass Gasification. Long story short, cellulosic ethanol processes convert cellulose in a wet process. Biomass gasification converts all organic components in a thermal process. The yield for biomass gasification will be much higher, and the waste products much lower.
The other variation that I think will work is this project I have been working on for a while, but still haven’t been given the green light to talk about. Hopefully soon.
- For those who want an inside edge in the energy sector.
- Written by veteran energy analysts and insiders with a track record of accurately predicting trends.
- 100% FREE!
- And Much More...
Energy Investment Forum
June 10-11, 2013 - San Francisco, CA
A Case of Renewables versus Natural Resources
June 10-11, 2013 - San Francisco, CA