POET seeks to develop next-generation ethanol products even as controversy swirls
Wade Robey hears the critics calling for an end, or at least a respite, from the federal mandate that fuel makers buy ethanol. As senior vice president for technology of POET, one of the nation's leading ethanol producers, he is sensitive to questions about the tremendous amounts of energy and water used to produce corn and ethanol.
Yet Robey steadfastly pushes his staff of 60 researchers to develop an exciting next generation of more efficient fuel products from biomass. Robey outlined many of the Sioux Falls, S.D.-based company’s advances at last week’s Future Farm Americas conference in San Francisco.
One of POET’s big new area of emphasis is cellulosic ethanol. The company plans to build one of the first commercial plants in the country in Emmetsburg, Iowa. (DuPont earlier this year said it will start work on a cellulosic ethanol plant in Nevada, Iowa as well. And a major plant is expected to be operational in Italy later this year.)
Dubbed Project Liberty, the POET project will be a joint venture with Royal DSM, a $12 billion Dutch-based company. DSM is developing traits engineered to make it easier to break down cellulose from corn stover (the leaves, stalks and cobs of corn) and reduce the cost of applying enzymes.
The new facility, slated to begin operations at the end of 2013, will build on the success of a pilot plant POET opened in 2008 at its Scotland, S.D.-based research facility. POET has been working there with farmers to bale and transport residue left in fields after harvest.
"POET brought a basic technology to the table for the cellulosic facility. DSM is now coming in with the source of enzymes and fermentation yeast that will be dropped into the technology box that POET has developed," Robey explained.
Robey believes cellulosic ethanol represents a huge opportunity. If the technology is deployed as planned at POET’s network of 27 existing corn ethanol plants, the company could produce up to 1 billion gallons of cellulosic ethanol per year. POET currently has the capacity to produce more than 1.6 billion gallons of ethanol, 9 million pounds of high-protein animal feed and thousands of pounds of bio-based oils and lubricants.
Federal law requires refiners and importers of gasoline and diesel fuel this year to use 500 million gallons of cellulosic ethanol in transportation fuel blends. That's not going to happen. The Environmental Protection Agency estimates that just 8 million gallons of cellulosic ethanol will be produced in 2012, and it will largely come from demonstration and pilot plants. The agency has said it will adjust the mandate to reality.
Energy experts have touted the potential of cellulosic ethanol for years. It can be made from a variety of non-grain sources, including agricultural residue, grain sorghum, wheat, barley and potatoes. The process produces a clean-burning, high-octane fuel that is the same as ethanol made from corn.
POET, which wants to be the leader in cellulosic ethanol, is testing many of those raw materials. It hopes to produce cellulosic ethanol everywhere it makes corn ethanol. "We think the way going forward is to co-locate [production]," Robey said, noting that in that way the operations can share power and POET can optimize infrastructure investments.
Robey said POET's new cellulosic plant will produce 25 million gallons a year, initially, and go from there. The plant already produces 55 million gallons of corn ethanol annually.
"POET hopes over the next decade to produce about 1 billion gallons of cellulosic ethanol, in addition to corn ethanol. We’ll do that by co-locating these facilities with our 27 other corn facilities around the Midwest. We then hope to license this technology to other providers in the industry," creating an additional 1 billion gallons.
"Then lastly, we’re looking at processing other feed stocks—bagasse in Brazil, wheat straw in Europe, possibly grasses in the West—to produce another 1 billion gallons. So POET alone believes we can produce about 3 billion gallons of cellulosic ethanol over the course of the next 10 years through this process," Robey said.
The federal government has set an ambitious goal of producing 16 billion gallons of cellulosic ethanol annually within 10 years.
POET researchers are also looking for ways to produce butanol from bio-mass. Butanol is produced with the same feedstocks as ethanol but with a different fermentation and distillation processes. "We think that’s a viable alternative. Our plants could be retrofitted easily....I could see us in the future having butanol production in some of our plants."
The company continues to expand the products it produces from corn. Earlier this year, POET announced that, after a successful test launch, it is producing Voila corn oil -- an industrial oil derived from the enthanol process -- at 14 of its plants. POET is on a pace to produce 600 million gallons of Voila each year that could go into animal feed and bio- diesel production. With processing, Robey said, it could even be used for human food.
In addition to ethanol, the company produces a distiller’s dried grain (DDG) called Dakota Gold that is used as animal feed. It captures carbon dioxide at five of its plants for sale to beverage producers and other users. It pulls fiber from corn kernels for use in human dietary products. And it makes zein, a low-nutrient protein found in corn, for use in adhesives, binders, paints and shellacs.
POET maintains that while the ethanol industry uses 40% of the corn produced it this country, it returns much of that in the form of animal feed. Robey said that accounting for the DDG’s produced by ethanol producers, the industry really only uses 16% of the corn crop for ethanol.
Meanwhile, Robey and his staff of researchers and technicians are working to reduce the water and energy required to produce corn ethanol. In the last decade, ethanol producers have made dramatic strides in producing more ethanol from a bushel of corn, even as academics point out that a better measure would include the water and energy used to farm and transport corn.
"We lead the industry, at 2.9 to 2.95 gallons per bushel, because we have some proprietary technology," said Robey. "But the whole industry has improved their yield of ethanol from a bushel of corn."
Producers have also dramatically decreased the natural gas and water they use to produce ethanol, he said. POET consumes less than 2.5 gallons of water to process a gallon of ethanol by recovering it. "It takes 44 gallons of water to process a gallon of oil," he said.
The size of the ethanol industry has tripled since 2005 and delivers 10% of the fuel into the gasoline market. Robey said that it reduces the price of gasoline by a dollar or more, depending on where you live. Under the Renewable Fuels Standard, U.S. fuel companies are required to blend 13.2 billion gallons of ethanol into gasoline in 2013, or about 10% of total gasoline usage, which requires converting some 40% of the U.S. corn crop into the biofuel.
"But there’s an obvious question that you have to think about – should we be using corn, food crops, for fuel?
Robey argued that moderately high corn prices in the U.S., in the $4 to $6 per bushel range, are necessary to stimulate production around the world and to prevent dumping on overseas markets by U.S. producers.
"There has been political pressure from livestock producers. They would like to see $2 corn, or $1 corn. It lowers their feed costs. I came out of that industry; I understand. Feed is about 55 to 65% of the cost of production of poultry."
Robey says there’s a tremendous amount of corn out there available for fuel use, especially if you are including the husks and other refuse. "This will be the eighth largest corn crop in us history."
Moreover, yields will increase around the world once technology used in the U.S. is exported and used. "A lot of technology is in play that will make corn abundant in the future," he said.
Here's a video of the press conference announcing the opening of Project Liberty: