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Cellulosic Biorefineries –

The race for cellulosic ethanol development is on. In the lead are six companies selected by the US Department of Energy (DOE) in February 2007 to construct demonstration “biorefineries” that will ultimately produce energy and fuels from biomass. These companies — Abengoa Bioenergy, Alico, Blue Fire Ethanol, Iogen, Poet and Range Fuels — have proposed various approaches to the production of cellulosic ethanol, that is, ethanol made from woody plants such as agricultural wastes, forest residues and wood.

So what made these companies winners for these grants? What technologies will they be using to produce bioenergy? What made the DOE double the anticipated funding? And what impact will these biorefineries have on the forest products industry? This article intends to explore these questions to better understand the process and potential implications it could have on the pulp and paper and related industries.

Surprisingly, the grants provided by the DOE will amount to $US 385 million in total funding, which more than doubles the scope initially targeted by the Department in their February 2006 biorefinery solicitation announcement. With the private sector sharing at least 60 % of project costs, the DOE’s funding leverages nearly $US 1 billion in total capital investments. In other words, the US intends to spend close to the combined capital expenditures of the top five leading Canadian pulp and paper companies as reported in 20061. Yet, from another perspective, this amount represents far less than the estimated $US 1.4 billion US drivers spend on gasoline and diesel fuels in a single day.

As shown in the accompanying table, the DOE awards target the development of three conversion technologies: acid hydrolysis, enzymatic hydrolysis and gasification. Broadly speaking these are the most well-known processes for producing ethanol from cellulose2. What is not known, however, is how well these processes will work, and at what cost.

Acid Hydrolysis

There are several approaches to producing ethanol from acid hydrolysis and the DOE has targeted both the dilute or concentrated acid processes. On the dilute acid hydrolysis side, Abengoa Bioenergy, the US subsidiary of Spain’s Abengoa S.A., intends to integrate production of both cellulosic and starch-based ethanol in a new hybrid plant that the company will build in Kolrich, KS at a reported cost of $US 300 million. The company is likely to use a “steam explosion” process for pre-treating corn stover and other agricultural wastes prior to enzymatic hydrolysis. In steam explosion, the biomass is exposed to elevated pressures and temperatures, typically up to 3 MPa and 200C, for a period of time in a steel vessel or “steam gun.” Following a certain time, the pressure of the steam gun is quickly released to atmospheric pressure causing the biomass to “explode.” The process is likened to making popcorn, but on a much larger scale. Sugars liberated from the cellulosic material following enzymatic hydrolysis will be fermented to produce ethanol. Further, residual cellulosic material will be gasified to produce power. Abengoa has announced that the plant will be in operation towards the end of 2010.

Blue Fire Ethanol will demonstrate the concentrated acid hydrolysis process using a technology the company has licensed from Arkenol. Blue Fire intends to use construction waste to produce 19 million gallons per year of ethanol. This approach is exciting in that concentrated acid hydrolysis is reported to have high sugar yields (> 90%) and can be easily adapted to a variety of biomass feedstocks. While acid recovery and handling have been viewed as barriers to widespread use of this process, Blue Fire believes that their Arkenol process successfully overcomes both of these.

Enzymatic Hydrolysis

With enzymatic hydrolysis, the biomass is treated with enzymes to convert hemicellulose and cellulose into fermentable sugars. However, high conversion yields require that the biofeedstock be pretreated in order to maximize exposure of the hemicellulose and cellulose active sites to the enzyme. In this regard, the challenge of enzymatic hydrolysis lies in both developing an efficient pretreatment technology and lowering the cost of the enzymes. The Department of Energy selected Poet and Iogen to demonstrate enzymatic hydrolysis on a commercial scale.

Poet, which recently changed its name from Broin Companies, is collaborating with DuPont to convert corn stover into ethanol at Poet’s corn-to-ethanol plant in Emmetsburg, IA. Poet will expand its existing starch-based ethanol production from 50 to just under 100 million gallons per year. The expanded plant will also have a capacity of 31.2 million gallons per year of cellulosic ethanol produced from corn fibre and corn stover. Poet has developed a proprietary fractionation process called BFrac’ that separates milled corn into fibre, germ and endosperm fractions. Poet claims that BFrac’ has improved the efficiency of corn-to-ethanol production since only the endosperm fraction is processed into ethanol. Presumably a portion of the fibre fraction will now be used to produce cellulosic ethanol. DuPont, which has been developing genetically modified strains of the bacteria Zymomonas mobilis for conversion of wood sugars, provides high-efficiency fermentation technologies in support of the Poet project.

Ottawa-based Iogen will also demonstrate enzymatic hydrolysis in their 18 million gallon per year cellulosic ethanol plant in Shelly, ID. Iogen, which boasts over 20 years experience in bio-ethanol research and development efforts, will use proprietary methods for both biomass pre-treatment, based on steam explosion technology, and enzymatic hydrolysis. Iogen also claims to have developed high efficiency enzymes for converting cellulosic substrates to fermentable sugars.

Gasification

Perhaps the most straightforward of the converting technologies is gasification of biomass, which relies on the production of a synthesis gas or “syngas” as an intermediate step to the generation of power or liquid fuel production. In power generation applications, the syngas is directed to either drive a turbine or fuel a boiler. The syngas can also be catalytically converted into a liquid fuel.

Range Fuels will use a combination of a novel gasification and catalytic conversion technologies to produce 40 million gallons of ethanol and 9 million gallons of methanol in a new facility located in Georgia. The company, formerly known as Kergy, intends to use both forest residues and energy crops in a “gas-to-liquids” or GTL conversion process similar to that used by South African chemical producer Sasol to produce liquid fuels from coal. Range believes that their process is simple as it does not rely on biological systems. However, biomass GTL technologies have yet to be commercially demonstrated and high capital costs have posed a barrier to GTL proliferation. Abengoa’s project will also include a gasifier to produce power.

Finally, citrus and sugarcane producer Alico Inc. will demonstrate the use of gasification/fermentation technologies developed by Bioengineering Resources Inc. (BRI). In the BRI process, hot syngas, which exits the gasifier at temperatures around 1200C, is cooled to 35C and then bubbled through a reactor containing proprietary strains of anaerobic bacteria that convert the syngas into ethanol. Waste heat from the process is used to produce high temperature steam and generate electric power.

Commercial impact

At the time of writing, the Renewable Fuels Association lists the number of commercial corn-to-ethanol plants in the US at 115 with annual capacity of 5.8 billion gallons: a more than 3-fold increase in production capacity since 20003. An additional 79 plants and seven plant expansions have been announced, bringing the total future capacity to just over 12 billion gallons per year.

What is creating this demand for ethanol? Escalating petroleum prices are an obvious driver. Bu
t more complex issues such as legislation banning the use of methyl-tertbutylether (MTBE) as a gasoline additive, geopolitical forces that are putting US oil supplies at risk, increasing evidence that androgenic carbon dioxide contributes to global warming, and growing consumer demand for environmentally-friendly energy solutions, have come together to create a “perfect storm” for ethanol demand.

Since nearly all of US ethanol plants are expected to run on corn, the expanded capacity is expected to place serious pressure on the US and global corn supply. In this regard, cellulosic biorefineries provide a means for satisfying demand for ethanol without further pressuring food supply. The DOE and private industry recognize that cellulosic ethanol represents the possibility of using “waste materials,” such as agriculture and forest residues, as a source of liquid fuels. Those in the forest products industry will want to pay close attention to these projects as they may create both opportunities for growth and significant disruptions to the forestry resource base.

While corn-based ethanol production can be considered a mature industry, cellulosic ethanol is at its early stages of development. In this regard, increased levels of government funding shows commitment to support the development of process technologies needed to produce alternative fuel supplies within the US. It also represents a serious commitment to rural development as all the projects will be located in rural communities located throughout the US.

From an investment standpoint, the cost of building a cellulosic ethanol plant is clearly an expensive proposition. Capital effectiveness, meaning the capital investment needed to produce one gallon of ethanol per year, for cellulosic ethanol is at least 2X as expensive as a typical corn-to-ethanol facility. Much of the added expense is due to the pretreatment technologies that are needed to process the cellulose. It is expected that capital effectiveness will improve with scale and with the greater efficiencies that come from technology advances. Of course, retrofitting an existing pulp and paper mill for the production of liquid fuels and bioenergy would lower capital requirements as key elements of the infrastructure needed to process biomass would already be in place. The challenge will be in developing the technologies and manufacturing practices that can utilize cellulose and produce bio-energy in a cost competitive way.

Forest products companies will want to pay attention to cellulosic ethanol and bioenergy development. The technologies that are being developed could be very complementary to the asset base of the industry, by providing both energy offsets and new revenue streams. In either case, the development of biofuel and bioenergy from wood will place pressure on a strategic industry resource. On the other hand, an emerging biofuels industry based on cellulose could shape a businesss model that redefines the very nature of our forest products industry.

Alexander A. Koukoulas, Ph.D. is a consultant for the pulp and paper and bioenergy industries and the principal of ANL Consultants, LLC. He can be reached at alex@ANLConsultants.com

1 Canada’s top five forest products companies combined capital expenditures of $US 403 million in 2006.

2 P.C. Badger, “Ethanol from cellulose: A general review”, in Trends in new crops and new uses, J. Janick and A. Whipkey (eds.), ASHS Press, Alexandria, VA. p. 17-21 (2002).

3 Renewable Fuels Association (2006).