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By Robert Rapier on May 29, 2012 with 13 responses

The First Commercial Cellulosic Plant is NOT About to Open

House Ag Committee Holds Hearings on Energy

On May 18, 2012 the House Committee on Agriculture held hearings on retaining Energy Title funding in the 2012 Farm Bill. Written testimonies and the video of the hearing are available at Formulation of the 2012 Farm Bill: Energy and Forestry Programs.

The hearings were held as Congress prepares to write the next Farm Bill. The purpose of this particular hearing was to discuss the renewable energy development provisions of the current Farm Bill, whether particular programs are achieving the desired results, and whether specific programs should be continued.

There were some comments during the hearing that warrant further analysis.

During his initial testimony, Jim Greenwood, who is President and CEO of Biotechnology Industry Organization (BIO) made the following comment (15:55 mark of the testimony): “INEOS Bio and its joint venture partner New Planet Energy are preparing to open the Indian River County BioEnergy Center, near Vero Beach, Florida within the next few weeks. The biorefinery is a major landmark for this country. It’s the first commercial cellulosic refinery.”

This claim has been repeated many times over the past decade — that one company or another was going to be the first to open a commercial cellulosic ethanol plant — but it is inaccurate.

Below is a short history of cellulosic ethanol production, which I detailed in The First Commercial Cellulosic Ethanol Plant in the U.S. All of this can be confirmed by visiting the U.S. Department of Energy – Energy Efficiency and Renewable Energy (EERE) link that I provide in the references.

A Brief History of Cellulosic Ethanol Production

Almost 200 years ago, in 1819, French chemist Henri Braconnot first discovered how to unlock the sugars from cellulose by treating biomass with sulfuric acid (Braconnot 1819). The technique was later used by the Germans who were the first to commercialize cellulosic ethanol from wood in 1898 (EERE 2009).

So the world’s first commercialization of cellulosic ethanol took place 114 years ago. First commercialization in the U.S. took place in 1910 — 102 years ago. The Standard Alcohol Company built a cellulosic ethanol plant in Georgetown, South Carolina to process waste wood from a lumber mill (PDA 1910). Standard Alcohol later built a second plant in Fullteron, Louisiana. Each plant produced 5,000 to 7,000 gallons of cellulosic ethanol per day from wood waste, and both were in production for several years (Sherrard 1945). So actual production 100 years ago was up to about 2.5 million gallons of cellulosic ethanol per year. Planned production at the INEOS facility is 8 million gallons per year.

In the decades after Standard Alcohol closed their plants, there were attempts at commercialization in the 1940′s and 1950′s, the 1970′s, and then of course over the past decade. Commercialization attempts have been global, and many different processes have been attempted. Countries attempting to commercialize cellulosic ethanol production include the U.S., Germany, Japan, and Russia.

Why does that matter? It should be obvious. Paraphrasing George Santayana’s famous quote: “Those who cannot remember the past are condemned to repeat it.” If people don’t realize that we have already commercialized cellulosic ethanol only to see it ultimately fail — and numerous people have claimed that one effort or another will be the nation’s first commercial cellulosic ethanol facility — then they obviously don’t know why those efforts failed. Thus, they will make many of the same mistakes.

Building a Plant is Not the Issue

There was an interesting question by Republican Representative Glenn Thompson of Pennsylvania (2:12:26 mark of the testimony): “Obviously the initial goal of the Energy Title in the 2008 Farm Bill was to spur the development of commercially viable cellulosic ethanol and advanced biofuels. However I am not sure that a single gallon of commercial cellulosic ethanol has been blended into the fuel supply. So it’s a two-part question for the panel. What challenges need to be addressed in order to address that issue and does the current Energy Title provide the tools to move toward the advancement of commercially viable cellulosic ethanol.”

The first attempt at an answer was by Jim Greenwood. He first mentioned that the recession slowed things down, and then he referred back to his opening statement on Ineos. He said that the structure is completed, and that “they are going to be producing cellulosic ethanol literally within the next couple or three weeks. So we have demonstrated now that the science is there, I think we have demonstrated with the construction of this plant that you can build a commercial facility, and now being able to demonstrate that we can move those fuels into the fuel stream for motorized vehicles is the final step to prove the whole concept.”

Two comments on that statement. First, start-up issues are assured. Once they attempt to start up, it will be a while before they are actually producing commercial cellulosic ethanol. They won’t do that right from the start. Second, I don’t think anyone ever doubted that you can build a commercial facility. Range Fuels built a commercial facility. The challenge is actually operating that facility to produce fuel that is to the right specification and economically priced.

The Problem of Scale

But then Jerry Taylor, who is the co-founder of MFA Oil Biomass provided a follow-up answer: “It takes 1,000 acres even at 12 tons an acre that we produce to produce 1 million gallons of cellulosic ethanol based on the known conversion rates today.”

Taking his biomass yield assumptions of 12 tons an acre at face value (I doubt you can consistently get 12 dry tons per acre at large scale; commercial hay production is only around half that), we can do an interesting calculation. One million gallons of cellulosic ethanol has the same energy content as half a million gallons of crude oil. (Ethanol contains 2/3rds the energy of gasoline, but a barrel of crude also produces diesel, jet fuel, and fuel oil). U.S. oil production is presently 6.1 million barrels per day. That is 256 million gallons per day, 10.7 million gallons per hour, or 1 million gallons every 5.6 minutes.

Therefore, taking his yield assumptions at face value, 1,000 acres of land planted in Miscanthus giganteus over the course of a year could produce the energy equivalent of under 3 minutes of U.S. oil production. Of course U.S. oil production does not come close to meeting our needs, so to put it in terms of total U.S. oil demand of 18.7 million bpd, 1,000 acres of Miscanthus would cover 55 seconds of U.S. oil consumption. Since that doesn’t take into account the petroleum that will be required to produce the cellulosic ethanol (e.g., running trucks and tractors), the net number would be even lower.

That really puts it into perspective relative to the oil we consume. I have stated previously that I don’t believe cellulosic ethanol will ever be more than a niche fuel. I certainly do not believe we will see it scale up to billions of gallons of annual production. I believe the potential niches will utilize waste biomass and cheap energy inputs to produce fuel, but I don’t believe purpose grown biomass can be utilized to make competitively priced cellulosic ethanol (although I do believe it will be used for other energy purposes).

Conclusion

My previous prediction remains in place: Cellulosic ethanol as a scalable solution to our energy problems will never materialize. Companies will continue to attempt it on a small scale (with taxpayer help), but they will ultimately all end up where Iogen has ended up.

For those who don’t know, Iogen has produced cellulosic ethanol in Canada at a small scale since 2004. In 2011, they produced 98,000 gallons — 6.4 barrels per day. They probably understand the economics of cellulosic ethanol better than anyone in the business. They have announced many times their intention of building a large facility, but they have never done so. And they recently cancelled plans to build a larger facility. They know that despite all of the available subsidies, the economics of cellulosic ethanol are still poor.

References

Braconnot, H. Annalen der Physik. (1819) 63, 348.

EERE, U.S. DOE Energy Efficiency and Renewable Energy. (2009). Biomass Program. Retrieved May 26, 2012 from http://www1.eere.energy.gov/biomass/printable_versions/dilute_acid.html

PDA, Pennsylvania Department of Agriculture. (1910). 16th Annual Report.

Sherrard, E.C.; Kressman, F.W. “Review of Processes in the United States Prior to World War II.” Industrial and Engineering Chemistry, Vol 37, No. 1, 1945, pp 5-8.

Link to Original Article: The First Commercial Cellulosic Plant is NOT About to Open

By Robert Rapier

  1. By Walter Sobchak on May 29, 2012 at 3:40 pm

    At 102 years, cellulosic ethanol is a mere child compared to other exemplars of “renewable” energy such as corn ethanol, at least 1000 years, and windmills, 500 years of use in the Netherlands, keeping the place comfy and dry.

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  2. By Tom Harrington on May 29, 2012 at 10:03 pm

    Most evolving biomass economic plans do not even consider ethanol.. Why would one make ethanol out of such a valuable solid fuel?  Witness the millions of tons being burned in power plants in the UK.

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    • By JM on May 30, 2012 at 8:07 am

      I think it’s important to distinguish between the uses of solid and liquid fuels. Until such time as electric vehicles are widely adopted and the supporting infrastructure put in place, solid fuels won’t help us drive our cars, and thus liquid fuels will continue to be needed. 

      I often see people say things along the lines of “we should stop making ethanol and instead invest in solar/wind/biomass fired electric/etc” but those type suggestions ignore the fundamental fact that we need liquid fuel. If you prefer some other renewable energy source to ethanol that’s fine, but keep in mind the differing uses of liquid and solid fuels. 

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      • By Ed on May 30, 2012 at 10:09 am

        It is also important to distinguish between the relative utility and value of reliable, dispatchable electricity and intermittent, “source of opportunity” electricity.

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  3. By Bioblogger on May 30, 2012 at 11:08 am

    Cellulosic ethanol comes in two varieties based on feedstock source.

    The first variety is that which is produced from purpose-grown crops – like switchgrass, miscanthus, hybrid poplars, sorghum, etc. Purpose grown crops could require seeding, fertilizing, irrigation, harvesting, and delivery to the recipient enterprise (biorefinery) where it could cost $35/green ton. The “energy in” for EROIE has to include these energy inputs. It is a chicken/egg challenge for biorefineries to convince farmers and foresters to grow purpose grown crops where no biorefinery already exists and, conversely, for developers to find investors for biorefineries that don’t already have existing purpose grown feedstock sources. Genera, for instance, has had to guarantee markets for growing purpose-grown feedstock for their demonstration DDCE biorefinery in Tennessee.

    The second variety is that which is made from waste streams including corn stover, citrus rinds, green waste, hurricane knockdown, beetle killed trees,  municipal solid wastes, etc. Waste streams are not cultivated, they are coped with. The economics is quite different – if there aren’t conversion technologies to recover energy from them, they risk turning into methane (a potent greenhouse gas) as they rot in place. They need to be aggregated and delivered to landfills and conversion facilities where a “tipping fee” of perhaps $35/ton must be paid to the recipient enterprise. The “energy in” for aggregation and delivery is not included in the EROIE as far as I know.

    The INEOS/New Planet Energy JV is built upon a model for converting waste biomass contracted with surrounding area waste haulers. The target 8MMg/y volume constitutes a large demonstration facility that will be lucky to make money at that scale. A successful commissioning means that a two-module facility will be clearly profitable and worthy of widespread deployment wherever similar waste streams are available.

    Range Fuels did reveal the challenge of deploying new cellulosic ethanol technologies in the U.S. – equal parts technology, investment, government policy, and commissioning experience. It was overhyped and you were an early whistleblower. The INEOS/New Planet JV is under-hyped if anything. I support the parties involved in this enterprise as a one of the most promising alternatives to our dependence on fossil fuels. Time will tell whether it is a full stride forward or a lesson learned. Fortunately we won’t have to wait too long.

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    • By Robert Rapier on May 30, 2012 at 3:13 pm

      Two things. I am very skeptical that we will get large-scale purpose grown biomass at $35/ton when hay costs $100/ton. I have always believe biofuel developers have underestimated their costs for raw materials.

      Second, I am of course not denigrating the INEOS effort, but instead pointing out that it certainly is not the first commercialization of cellulosic ethanol. That’s been done many times already.

      RR

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    • By Bioblogger on May 30, 2012 at 7:30 pm

      Robert -

      I can be a skeptic, too, as in: I am skeptical that we can predict the consequent outcome or value of a given technology under development. I am just finishing “The Prize” and the 150 year history of oil is filled with innovation, unforeseen discoveries, and unanticipated circumstances at every turn. We owe our culture and quality of life to oil – and the world is totally addicted.

      Oil took a while to find its full market potential as an illuminant alternative to whale oil. Then that market application was threatened to be totally wiped out by the electric light bulb. Fortunately for oil the internal combustion engine suddenly appeared and provided an even bigger market potential for a byproduct of kerosene production – gasoline. When that plateau was reached chemists focused on expanding the volume of gasoline produced per barrel through thermal cracking. One opportunity or circumstance led to another innovation.

      My point is that there is no way to predict how innovations today may branch out and find new markets in the future. Sure ethanol, does not have the energy density of gasoline, but gasoline has a long lists of deficits compared to ethanol – some technical, some environmental, some economic, many political. Modifications of applications (i.e., engine designs) may exploit those those differences. Or maybe, politics over oil access will necessitate the change.

      We need “niche fuel” alternatives at whatever scale we can produce them so we have the raw materials for technological advancement. It was a niche fuel – 100 octane gas – that won the air Battle over Britain fueling Spitfires against the kluggier 87 octane Messerschmitt. We need to develop alternatives before we are forced to find them.

      Let’s push the envelope a little bit and fight to enable deployments that will help us progress and innovate. I don’t think we learned much from Range Fuels. Maybe Lanzatech – who won the auction for the Soperton facility – will turn the lemon into lemonade.

      INEOS may not be as efficient a producer of ethanol as anticipated after scale-up – even after all the due diligence by Katzen, Parsons, and INEOS at pilot scale. But maybe it will give us fresh insight into gasification, or synthetic fermentation, or become a great conversion technology for certain waste stream combinations.

      We can’t possibly computer model everything – especially when it comes to biology. Neither can we clearly foresee the business and political environment of our future.

      - Scott

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  4. By ben on May 30, 2012 at 4:20 pm

    As Ronald Reagan famously offered about Walter Mondale “There he goes again…..”    Rapier has the audacity to keep speaking the truth about the Wizards of contemporary renewable fuels.   In most cases the numbers don’t work on an energy efficiency basis and most of them simply won’t work on a sustainable financial basis.   

    The tipping fee dimension of EfW  business models lends itself to back-of-the-envelope analysis that suggests “this looks viable,”  but the numbers must prove themselves sustainable over the entire period of debt-service and many contract arrangements fall well short of this mark, as lenders (or their guarantors) are left holding the bag without assurances of cost-effective feedstocks in the years ahead.   Let’s face it, as current waste managers (public agency or private company) scrutinize the supply/demand of waste streams for energy production, they will be requiring much lower tipping fees and/or a piece of the upside; we have been witnessing this inclination in several negotiations as it bears on contract length/price point.   As this dynamic evolves, it will continue to pinch marginal projects while rendering some unprofitable.   

    The INEOS BIO project in Vero Beach with it’s $125M in subsidies ($50M in Sec. 932 grant funds and $75M in USDA loan guarantees) out of $13oM TDC should achive profitability with solid feedstock contracts, RFS2 mandates remaining in place for the ethanol and an adequate PPA for the surplus power (2MW).   Dr. Gaddy’s tech has proven itself at pilot scale while INEOS appears to be taking a calculated path toward wider applications (engineering licensing via AMEC as the most recent case in point). But I’m not sure they’re in need of any cheerleaders folks.   They certainly won’t find one in the author of this blog who continues to insist that project owner-developers ground the efficacy of their business models in the discipline of the marketplace and not the expedience of the public trough.   Of course, folks at K-P and their strap-hangers will continue to give early 21st century American Capitalism it’s richly deserved reputation as an economic system offering those without hedge fund/IPO cronies little more than broom handles to sweep the IOU confetti from Uncle Sam’s bioenergy party of the past couple of decades. Hey, but why break up the party just yet?  Why, we haven’t even got DOD and all those civic-minded contractors involved!   

    What remarkable leadership from a country that actually dares consider itself serious about our dangerously compromised circumstances let alone prospects for a more rational future.   Gosh, it’s enough to make one blush.   Nah, that just might signal that someone in Washington, on Wall Street or out on the West Coast really gives a rip about our collective security, competitiveness or freedom.   That really would take a leap of both logic and faith. 

    Ben

                        

     

           

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  5. By Jim Takchess on June 1, 2012 at 4:45 pm

    although off-topic . I thought your readers might find this piece on heat storage material interesting . http://nanopatentsandinnovations.blogspot.com/2012/06/compact-and-flexible-thermal-storage.html

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  6. By Engineer-Poet on July 4, 2012 at 9:10 pm

    My previous prediction remains in place: Cellulosic ethanol as a scalable solution to our energy problems will never materialize.

    Many have done the calculations and made the same prediction, yet Washington’s policy does not lose its aspects of fantasy.  WTF is going on here?

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  7. By jim shilling on August 17, 2012 at 3:11 pm

    interesting thread– I am not very knowledgeable about this industry or this process but I am doing some research on a local proposal to turn up to 10,000 tons per day of municipal garbage into ethanol to then be blended into gasoline

    Is the technology here today and is there a plant doing this on a commercial scale now?

    I appreciate your input

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  8. By reedbarnes on August 24, 2012 at 2:36 pm

    I think we are thinking incorrectly about this. Large scale ethanol production, totally not viable to replace fossil fuels. The land requirements wouldn’t be worth it. Electricity or hydrogen based economies are the two most viable.

     

    Now, is there an area where cellulosic ethanol could be useful? This I think we can use. Find methods to build small scale ethanol manufacturing systems based on cellulosic feedstock. Farmers currently have large amounts of organic waste, corn shafts, straw, etc etc. If an individual farmer could feed in their own feedstock into a machine that produces it on their land and pumps it to a storage tank for their use, we could switch tractors from diesel and gas to ethanol. They could essentially make their own fuel. No real need for transportation costs, and it is just an economic benefit for them. It should also help to lower costs of food because fuel prices really wouldn’t affect it. Unprocessed waste is viable as an organic matter content fertilizer as well.

     

    Now, the problems persist with what this system would look like, what would be input costs, as well as maintenance or possible material cost as with enzymes. Again, Iogen apparently can do 40 tonnes of wheat mass a day. Now, with farmers we would see one large input of organic matter after harvest. You would need large storage tanks large enough to last a farm till the next harvest.

     

    Of course all this is just speculation and is just a thought I have. I would love to hear what people think. Good idea, bad idea. Maybe not viable.  I want to know more about this.

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  9. By Kates gwama on August 29, 2012 at 11:36 pm

    I’m living in a rural metro Atlanta county and I have only recently become aware of Georgia’s push and obsession with producing biomass & biofuel.  Apparently back in 2007, Alternative Fuels Director Jill Stuckey with the Georgia Environmental Facilities Authority said “We’re hoping to be the next Saudi Arabia.  We think we can surpass the Texas oil fields with production of our own renewable fuels here in Georgia.” She predicted, by 2010, Ga would be “annually producing 400 million gallons of ethanol from pine trees”. http://www.accessnorthga.com/detail.php?n=91098

    And so multiple agencies in Georgia are all buddied (good ole boy’ed) up together and have been doing everything possible to increase the amount of timberland here.  There is an enormous push throughout the Southeast to “restore the Longleaf Forests” with lots of federal and state dollars poured into conservation projects.

    I find it interesting that Longleafs are one of the highest terpene producing pines, but of course all the propaganda (oops! I mean promotion) never mentions that.

    Where I have a problem is that these millions of acres of trees they are planting (after clearcutting and harvesting the loblolly, slash and hardwoods) are “fire dependent” and must be prescribe burned every 2-3 years with herbicide applications in between.

    The Georgia Forestry Commission in their Spring 2012 internal newsletter bragged that they had burned a record 1.7 millions acres in 2011. This is with the longleaf restoration project only in its infancy.

    There are major air quality issues involved with this, but they have that covered. After comparing NOAA Sat fire and smoke products, news and USDA/State Forest Service reports with the he Ga Department of Natural Resources/Environmental Protection Division daily ambient air monitoring data, I am positive that for at least 5 years, the DNR/EPD shuts the monitors off during smoke events (and the high ozone days that follow).  (And I’m fairly certain South Carolina and other states are doing it, too.)  DNR/EPD also shuts them off when Alabama is burning the Talladega National Forest (about 50 miles from where I live). And Alabama is restoring its Longleaf Forest, too.

    (Oh, I almost forgot! They are all so deeply concerned about the red cockaded woodpecker and the gopher tortoises who must have their frequently burned longleaf pine forests to survive.)

    I literally am now wearing a cartridge filter mask about 75% of the time I am outdoors, have my windows sealed up with plastic and run air purifiers 24/7 because I have developed reactive airways to any type of combustion.  (I’m a lifelong nonsmoker and am/was very physically active and outdoors a lot. For the past 10 years when I thought I had a lingering chest cold or  bronchitis it was really a reaction to smoke from forestry burns and wildfires.) (Also, an active little boy on my street was diagnosed with asthma triggered by smoke last year.)

    Ben,

    The DOD is already in on it. With the help of organizations like the Nature Conservancy and the Trust for Public Land,  they have been buying up land (esp. timberland)  around their bases and installations (with original owners like Rayonier Forest Products beside Ft Benning retaining “leases”).

    http://www.army.mil/article/50051/from-the-ground-up-tree-planting-encourages-growth-of-ecosystem/?ref=news-environment-title1

    http://www.army.mil/article/50534/buffer-enhances-quality-of-life-wildlife-restoration/

    Ft Stewart, Ga 2009  “They not only broke their own long standing record of acreage burned, but are thought to be the world’s first or second largest prescribed burning program”

    http://aec.army.mil/usaec/newsroom/update/win09/win0904.html

    “Natural resource managers at Camp Lejeune Marine Corps Base in North Carolina have realized that restoring longleaf pine forests and their associated native plant communities will help to meet this steadily increasing list of resource demands. “

    http://srs4158clemson.blogspot.com/2012/05/from-one-forest-to-another.html

    Woodpeckers

    http://www.army.mil/article/33369/fort-benning-spends-about-1-million-annually-to-safeguard-endangered-birds/

    (The pictures are what longleaf pine forests often look like. Ugh.)

    Of course, maybe I’m just paranoid and all this longleaf restoration has nothing at all to do with denser biomass and higher terpene for biofuel.  Maybe the DOD has changed and just loves trees and woodpeckers:P

    In case you are interested in the air monitoring and satellite fire products:

    Ga DNR AMP Query: http://www.georgiaair.org/amp/amp_query.html

    NOAA Fire products: http://www.osdpd.noaa.gov/ml/land/hms.html

    Emissions: ftp://satepsanone.nesdis.noaa.gov/EPA/GBBEP/PREVIOUS_DAYS/

    Sat smoke analysis viewer 6/3/11 to 7/30/12:http://maps.ngdc.noaa.gov/viewers/firedetects/#

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