Top Producer Editor
The corn ethanol industry has reached a new milestone in efficiency, according to a new University of Illinois at Chicago study of facilities that produce most of the nation's ethanol.
The study found that the energy needed to make a gallon of the corn-based fuel decreased on average by about 30% within the past decade. Ethanol yields per bushel processed also improved 5.3% since 2001, according to Steffen Mueller, principal research economist at UIC's Energy Resources Center, who surveyed the nation's 150 dry mill ethanol plants between November 2009 and January 2010.
Key findings of the research include:
- Thermal energy use was less than 26,000 BTU/gallon on average, a reduction of 28% compared to 2001 data
- Electricity use was reduced by 32% compared to 2001 data
- Total water use was 2.72 gallons per gallon of ethanol produced, down significantly from previous estimates
New plant efficiencies have helped ethanol production hit record levels this spring, up 32% year to year, according to the Energy Information Administration (EIA). Despite that record high, inventories remain under control at 827 million gallons, also a record high but not out of line given higher usage. Strong demand has absorbed the record level of production.
Back to black. Efficiency plays into a return to black for some larger ethanol producers like ADM, which reported its first ethanol profits since the summer of 2008. ADM credits "improved ethanol margins and higher sales volumes resulting from lower net corn costs, decreased manufacturing costs, and favorable gasoline blending economics". The company started production at its Columbus, Neb., ethanol dry mill in the third quarter and expects to finish construction at the ethanol dry mill in Cedar Rapids, Iowa, this summer.
At the same time there have been many casualties of inefficiency and oversupply. The 13-year-old Minnesota Energy Ethanol Plant in Buffalo Lake, MN, shut down indefinitely April 9, citing declining profit margins. As one of the state's smallest ethanol facilities, producing 17 million gallons per year, it was costing the Buffalo Lake facility at least 50 cents more per bushel of corn to make ethanol than most of the newer, larger plants in Minnesota. The plant was also hit with a $1.15-million penalty in November for alleged air-emission violations from 2006 to 2008.
Heading into summer, the ethanol industry is walking on eggshells as it balances huge supplies with the potential for a slower summer driving season. Ethanol prices are being held back by strong production, which has hit the so-called "blend wall" - the 10% limit that US authorities allow in mixtures of the biofuel with conventional gasoline. The industry is asking again the Environmental Protection Agency this summer to approve a boost in the blend wall to at least E12 to keep demand strong.