September 2012 Ethanol Producer Magazine

INSIDE: THE RIGHT HEAT EXHANGER MINIMIZES FOULING SEPTEMBER 2012

In Search of Lost Profit Scrubber Bottom Waters, Vapor Flows Offer Up Recovered Ethanol Page 38

ALSO

Harnessing Data for Optimal Production Page 32

New Yeast Cuts Costs, Boosts Yield Page 44 www.ethanolproducer.com

contents

September issue 2012 VOL. 18 ISSUE 9

features

DEPARTMENTS

38

6

Editor’s Note

Once Again, It's About Efficiency

By TOM BRYAN

7

Ad Index

10 The Way I See It

32 OPTIMIZATION

Optimal Yield: A Moving Target

Producers invest capital, harness data to raise production rates

By Holly Jessen

38 RECOVERY Stop Loss

Seeking solutions to ethanol loss in CO2 scrubber bottom waters

By Sue Retka Schill

Greening the Fleets

By MIKE BRYAN

11 Events Calendar

Upcoming Conferences & Trade Shows

12 View From the Hill

Building New Markets,

Protecting Those We Have By bob dinneen

14 Drive

Fighting the Good Fight

By TOM BUIS

16 Grassroots Voice The Fallible Pope

44 FERMENTATION Pinching Pennies

Engineered yeast product reduces enzyme requirements, increases yield

By Kris Bevill

By RON LAMBERTY

18 Europe Calling Food and Fuel:

Back on the Table

By Rob Vierhout

20 Business Matters JOBS Act Creates

Opportunities

By Gregory Lynch, Porter Martin and Jeff Barrett

22 Business Briefs 24 Commodities Report

CONTRIBUTIONS 50 ENERGY

Tapping into a Heat Recovery Opportunity to Reduce Energy Costs

Custom design addresses fouling issues with RTO heat recovery

By Tom Tucker

26 Distilled 58 Marketplace

54 ANTIMICROBIALS

INSIDE: THE RIGHT HEAT EXHANGER MINIMIZES FOULING SEPTEMBER 2012

Bacterial Inhibition Without Antibiotics

Combining technologies reduces infections, improves yeast nutrition

BY Sami Faour

In Search of Lost Profit Targeting Scrubber Bottom Waters, Vapor Flows for Ethanol Recovery Page 38

ALSO

Harnessing Data for Optimal Production Page 32

New Yeast Cuts Operating Costs, Increases Yield Page 44

www.ethanolproducer.com

Ethanol Producer Magazine: (USPS No. 023-974) September 2012, Vol. 18, Issue 9. Ethanol Producer Magazine is published monthly by BBI International.

Principal Office: 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. Periodicals Postage Paid at Grand Forks, North Dakota and additional mailing offices.

POSTMASTER: Send address changes to Ethanol Producer Magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, North Dakota 58203.

ON THE COVER

Adam Anderson, ICM product manager, is part of a team that sought to verify ethanol loss.

PHOTO: ICM INC.

4 | Ethanol Producer Magazine | September 2012

editor’s note

Tight margins probably have your plant back on a yield maximization quest. Producing “efficient gallons” is the name of the game this summer. However, that wasn’t the case in the fourth quarter of 2011 when your plant was probably running as hard as it could, regardless of yield, pushing out as many gallons as possible. The last eight months have illustrated how corn and ethanol price volatility require today’s ethanol plants to not just know how, but when, to pursue yield maximization.

As Holly Jessen’s page 32 feature, “Optimal Yield: A Moving Target,” points out, it is critical to have the best available tools, technology and data at your disposal when margins dictate efficiency over volume. Jessen’s piece explains how Illinois River Energy LLC has coupled smart equipment investments—from grind to distributive control—with advanced yield modeling and margin management techniques to improve its ability to time and implement its yield maximization campaigns. The result: seeing

Once Again, it's about efficiency

the 2012 ethanol glut before most plants did. “We knew right away when we started running the numbers that running max gallons in January made no sense from a financial point of view,” says Illinois River’s Neal Jakel. “We’ve been running for yield optimization since the first of the year, and still are today.”

Tom Bryan, PRESIDENT & EDITOR IN CHIEF tbryan@bbiinternational.com

But as we learn in this month’s cover story, even the most efficiently produced ethanol leaving your fermenters may not end up in your storage tanks. Sue Retka Schill’s page 39 feature, “Stop Loss,” sheds light on the longtime question of how much ethanol is lost in your facilities’ various process streams. The results are noteworthy, according to ICM, which conducted testing at six ethanol plants and discovered that ethanol losses are occurring at significant levels in the CO2 scrubber bottoms, cook water tanks and other places. The data is intriguing. According to ICM, about 1,600 gallons of ethanol are lost daily at an average 50 MMgy ethanol plant. Quickly doing the math on this newfound revenue loss category, ICM has developed an affordable process rerouting fix that’s worth a look.

Your fourth quarter production strategy probably looks much different than your pedal-to-the-metal approach of a year ago. There are times for efficiency-be-dammed gallons and times for precision and yield optimization. Now is the latter.

For industry news: www.ethanolproducer.com or Follow Us: 6 | Ethanol Producer Magazine | September 2012

twitter.com/EthanolMagazine

AdIndex

EDITORIAL PRESIDENT & EDITOR IN CHIEF Tom Bryan tbryan@bbiinternational.com

Vice President of Content & EXECUTIVE EDITOR Tim Portz tportz@bbiinternational.com

CONTRIBUTIONS EDITOR

62

2012 National Advanced Biofuels Conference & Expo

53

GEA Westfalia Separator

63

2013 International Fuel Ethanol Workshop & Expo

2

Growth Energy

61

2013 National Ethanol Conference

3

Himark bioGas

29

Aggreko

5

ICM, Inc.

19

Ashland Hercules Water Technologies

8-9

48

BBI Consulting Services

47

INTL FCStone Inc.

30-31

BetaTec Hop Products

13

Lallemand Ethanol Technology

27

BrownWinick Law Firm

41

Louis Dreyfus

26

Buckman

55

Nalco Company

34

CPM Roskamp Champion

57

Natwick Associates Appraisal Services

46

DuPont FermaSure

15

Pioneer Hi-Bred International

DuPont Industrial Biosciences

21

POET LLC

51

ETS Laboratories

35

Tower Performance, Inc.

28

Fagen Inc.

43

U.S. Water Services

37

Ferm Solutions

36

Vogelbusch USA, Inc.

49

Fermentis - Division of S.I. Lesaffre

56

Wabash Power Equip. Co.

40

Freez-it-Cleen

42

WCR Incorporated

52

Gamajet Cleaning Systems, Inc.

Susanne Retka Schill sretkaschill@bbiinternational.com

FEATURES EDITOR Holly Jessen hjessen@bbiinternational.com

NEWS EDITOR Erin Voegele evoegele@bbiinternational.com

COPY EDITOR Jan Tellmann jtellmann@bbiinternational.com

ART ART DIRECTOR Jaci Satterlund jsatterlund@bbiinternational.com

GRAPHIC DESIGNER Lindsey Noble lnoble@bbiinternational.com

PUBLISHING CHAIRMAN Mike Bryan mbryan@bbiinternational.com

Inbicon

CEO Joe Bryan jbryan@bbiinternational.com

SALES VICE PRESIDENT, SALES & MARKETING Matthew Spoor mspoor@bbiinternational.com

EXECUTIVE ACCOUNT MANAGER Howard Brockhouse hbrockhouse@bbiinternational.com

SENIOR ACCOUNT MANAGER Jeremy Hanson jhanson@bbiinternational.com

ACCOUNT MANAGERS Marty Steen msteen@bbiinternational.com Bob Brown bbrown@bbiinternational.com Andrea Anderson aanderson@bbiinternational.com Dave Austin daustin@bbiinternational.com

CIRCULATION MANAGER Jessica Beaudry jbeaudry@bbiinternational.com

ADVERTISING COORDINATOR Marla DeFoe mdefoe@bbiinternational.com

Senior Marketing Manager John Nelson jnelson@bbiinternational.com

17, 64

EDITORIAL BOARD Mike Jerke, Chippewa Valley Ethanol Co. LLLP Jeremy Wilhelm, Cilion Inc. Mick Henderson, Commonwealth Agri-Energy LLC Keith Kor, Pinal Energy LLC Walter Wendland, Golden Grain Energy LLC Neal Jakel Illinois River Energy LLC Bert Farrish Lifeline Foods LLC Eric Mosebey Lincolnland Agri-Energy LLC Steve Roe Little Sioux Corn Processors LP

Customer Service Please call 1-866-746-8385 or email us at service@bbiinternational.com.

Subscriptions to Ethanol Producer Magazine are free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside the United States, Canada and Mexico. To subscribe, visit www.EthanolProducer.com or you can send your mailing address and payment (checks made out to BBI International) to: Ethanol Producer Magazine Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to (701) 746-5367.

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Article reprints are also available for a fee. For more information, contact us at (866) 746-8385 or service@bbiinternational.com. Advertising Ethanol Producer Magazine provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about Ethanol Producer Magazine advertising opportunities, please contact us at (866) 746-8385 or service@bbiinternational.com. Letters to the Editor We welcome letters to the editor. Send to Ethanol Producer Magazine Letters to the Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or email to sretkashill@bbiinternational.com.

Please include your name, address and phone number. Letters may be edited for clarity and/ or space.

Please recycle this magazine and remove inserts or samples before recycling

COPYRIGHT Š 2012 by BBI International TM

September 2012 | Ethanol Producer Magazine | 7

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the way i see it

Greening the Fleets

By Mike Bryan

The greening of the U.S. Navy fleet has had ramifications Down Under as well. In 2014, the U.S. Navy will shore up its presence in Australia by moving ships into the Australian naval base at Darwin. As a result, the Australian navy announced that it would join the green fleet effort and issued the following press release:

10 | Ethanol Producer Magazine | September 2012

Navy Signs Biofuels Pact with US Friday, 20 July, 2012—The Royal Australian Navy has taken a major step towards “greening” its warships and aircraft with a new agreement that will give it access to technology being developed in the U.S. to enable the massive American fleets to run on biofuels by 2020.

The U.S. has set the target to ensure it can continue to use its armed forces globally as future fuel shortages start to bite and to reduce the military’s environmental footprint. Australian forces have acknowledged they will have to adapt quickly to use the same fuels as the U.S. military so they can continue to work with the Americans on joint operations.

A joint approach on fuels will also be vital as plans progress for increased visits to Australian bases by U.S. warships and aircraft.

The cooperation agreement was signed yesterday aboard the aircraft carrier USS Nimitz, off Hawaii, by the RAN’s fleet commander, Rear Admiral Tim Barrett, who is responsible for all navy surface ships, submarines and aircraft. The rear admiral is both a sailor and a pilot.

Rear Admiral Barrett said technological advances would flow from the navy and the Australian Defence Force generally to industry in Australia and the U.S., and Australian forces could benefit from advances made, for

example, in Australia’s aviation industry.

“That is a critical part. It may well be that the aviation industry allows us to share information on how they do it,” he said. “The U.S. is doing it for all the same reasons that Qantas is doing it.

Rear Admiral Barrett flew out to the U.S. carrier on an Australian navy helicopter, which was refuelled aboard the vessel with a biofuel blend. The aircraft was checked out and certified to use the green fuel.

The U.S. wants its forces to be using at least a 50-50 blended biofuel by 2020. Rear Admiral Barrett said the agreement was about being responsible into the future and being able to secure other, sustainable forms of fuel.

“We’re about research, learning what’s being done.” Ideally, Australia could be in the same position on biofuels as the U.S. in 2020, he said.

“We are here to learn what we need to do to remain interoperable with them.

We’d be mad not to be involved.”

Good on ya Australia!

That’s the way I see it.

Author: Mike Bryan Chairman, BBI International mbryan@bbiinternational.com

EVENTS CALENDAR

Algae Biomass Summit September 24-27, 2012 Sheraton Denver Downtown Hotel Denver, Colorado

Advancing Technologies and Markets Derived from Algae Organized by the Algae Biomass Organization and coproduced by BBI International, this event brings current and future producers of biobased products and energy together with algae crop growers, municipal leaders, technology providers, equipment manufacturers, project developers, investors and policy makers. It’s a true one-stop shop—the world’s premier educational and networking junction for the algae industry.

Houston to host National Advanced Biofuels Conference & Expo in November Produced by BBI International, the conference and expo will focus on domestic production of advanced biofuels and biobased chemicals The 2012 National Advanced Biofuels Conference & Expo will be held at the Hilton Americas in Houston, Nov. 27-29. The event will unite existing and future advanced biofuels producers with strategic petrochemical and agribusiness partners, government officials, investors and project finance professionals, technology and biomass supply-chain service companies.

The event was successfully launched in 2011 as the International Biorefining Conference & Trade Show. In consultation with sponsors and supporting organizations, BBI changed the name of the event to highlight its critical role in helping the U.S. bioenergy and refining industries meet America’s explicit advanced biofuels quest. “RFS2 requires 21 billion gallons of advanced biofuels to be blended into the U.S. transportation fuel supply by 2022,” says Joe Bryan, CEO of BBI International.

“We have now aligned the conference and expo with that national mission.”

The National Advanced Biofuels Conference & Expo will continue to focus on the scale-up, commercialization and market development of both advanced biofuels and biobased chemicals. Presentations will focus predominantly on domestic production, R&D, and project development. International industry issues, such as exports and imports, foreign biofuels production and policy, and feedstock issues, will be covered from a domestic viewpoint. The two-day agenda will answer critical questions facing the industry and will offer conference attendees an unparalleled opportunity to gain a broad understanding of where the U.S. advanced biofuels industry is, what challenges it faces, and where it is headed.

“This event will bring the entire industry together under one canopy,” says Matt Spoor, vice president of sales and marketing at BBI International. “The name change exemplifies the new direction of the program. It also speaks to the ‘all-of-the-above’ strategy that’s needed to meet our national advanced biofuels targets. Drop-in biofuels, advanced and cellulosic ethanol, biobased chemicals—we’re bringing it all together in Houston.”

(866)746-8385 | www.algaebiomasssummit.org

National Advanced Biofuels Conference & Expo November 27-29, 2012 Hilton Americas - Houston Houston, Texas

Next Generation Fuels and Chemicals Make plans to attend the 2012 National Advanced Biofuels Conference & Expo in Houston. Understand the latest techniques being developed in the industry and continue building relationships that last. Register by Oct. 16 to take advantage of early-bird registration rates.

(866)746-8385 | www.advancedbiofuelsconference.com

International Biomass Conference & Expo April 8-10, 2013 Minneapolis Convention Center Minneapolis, Minnesota

Building on Innovation Organized by BBI International and coproduced by Biomass Magazine, the International Biomass Conference & Expo program will include 30-plus panels and more than 100 speakers, including 90 technical presentations on topics ranging from anaerobic digestion and gasification to pyrolysis and combined heat and power. This dynamic event unites industry professionals from all sectors of the world’s interconnected biomass utilization industries—biobased power, thermal energy, fuels and chemicals.

(866)746-8385 | www.biomassconference.com

International Fuel Ethanol Workshop & Expo June 10-13, 2013 America’s Center St. Louis, Missouri

Where Producers Meet Now in its 29th year, the FEW provides the global ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-to-business environment. The FEW is the largest, longest running ethanol conference in the world—and the only event powered by Ethanol Producer Magazine.

(866)746-8385 | www.fuelethanolworkshop.com

September 2012 | Ethanol Producer Magazine | 11

view from the hill

Building New Markets, Protecting Those We Have

By Bob Dinneen

The Renewable Fuels Association was pleased to work with the Kansas Corn Commission, East Kansas AgriEnergy and fuel retailer Zarco 66 to open the nation’s first E15 station under the waiver granted by the U.S. EPA on July 10. Make

no mistake: this was a historic occasion, as it was the first new fuel blend the nation has seen in more than 30 years.

It was also significant for the choice it offers American drivers. At every pump Scott Zaremba has at his Zarco 66 “Oasis” in Lawrence, Kan., drivers have the option to choose E10, E15, E30 or E85. This blender pump configuration takes the choice away from petroleum companies and puts the decision firmly in the hands of consumers. Since debuting E15, drivers have chosen this new fuel blend between 16 and 26 percent of the time, on average.

With the successful introduction of E15, albeit on a localized scale, we now have concrete data demonstrating the desire of consumers to have more fuel options. We also have data that pours cold water on ethanol critics who have done all they can to scare consumers about E15.

The American Petroleum Institute and its Kansas affiliate went so far as to warn consumers against using E15. As the data from day to day usage shows, consumers are more than capable of choosing fuel for themselves without the “advice” of the oil industry.

12 | Ethanol Producer Magazine | September 2012

This industry must remain committed to expanding the market for ethanol because doing so will not come easy. It will require more than press releases and ad campaigns. It will take a concerted and coordinated effort to beat back challenges in Congress, in the courts and in commerce, while pushing forward a positive agenda that responsibly moves the market.

First, the industry must look for ways to address the summer time Reid vapor pressure (RVP) cap for gasoline. This cap of nine pounds per square inch makes offering E15 in most regions a nonstarter.

Without the one-pound RVP waiver that is granted to E10, retailers are hard pressed to find affordable gasoline stocks to blend with 15 percent ethanol. We must continue to work with EPA and other regulators to either afford E15 the same waiver or eliminate the waiver for all fuels. In either case, it opens the door for greater E15 use year-round.

Second, we must remain united in the face of headwinds from Capitol Hill aimed at preventing E15 from gaining a foothold in the market. That means working cohesively to address misinformation on the efficacy and safety of E15, while also pushing commonsense legislation that would ease retailer concerns over liability issues related to the partial nature of the waiver EPA granted. Successfully selling E15 in Lawrence will go a long way in dispelling those concerns.

Using scientifically and market-backed data, we must also push back on claims made by the oil industry, which is desperate to prevent ethanol and other biofuels from gaining any more market share than they have today. Hyperbole does not cancel out

hyperbole. We must stick to the facts and the science; they are on our side.

Of course, all of this occurs in the shadow of pending litigation, as I write this, and grave concerns about the nation’s corn crop and the renewable fuel standard (RFS). With the courts, there is little we can now do but make sure we take its decision and move forward in a constructive manner.

As for the RFS, we can and have been pushing back hard on those calling for a waiver or repeal. The market is working to ration demand. The RFS, with its built-in flexibility, is still working. Continued, but slower, ethanol production, ample ethanol gallons in storage and an excess of 2.5 billion renewable identification numbers (RINs) all provide sufficient opportunity for obligated parties to meet requirements under the RFS. The industry has made great strides in the three years since the E15 waiver was filed. Manufactured angst, artificial headwinds and unforeseen acts of nature are creating a perfect storm of sorts that threatens the progress we have made. The issues we face—expanding the market, accelerating innovation, defending the RFS—are too important to the nation and to this industry. In the end, we will carry the day.

Author: Bob Dinneen President and CEO, Renewable Fuels Association (202) 289-3835

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Ǥ Ǥ ̿ǡ Ǥ Ǥ Ǥ ©2012 LALLEMAND ETHANOL TECHNOLOGY. TRANSFERM IS A JOINT TRADEMARK OF LALLEMAND ETHANOL TECHNOLOGY AND MASCOMA CORPORATION.

DRIVE

Fighting the Good Fight

By Tom Buis

The ethanol industry fights an ongoing battle as we work to end our dependence on foreign oil and create jobs here at home that cannot be outsourced, while producing a fuel that is cleaner burning and better for our environment. Though it sometimes can be easy to lose sight, the increasing challenges we face are directly correlated to our achievements. In particular, with higher blends of ethanol in gasoline gaining greater acceptance, we are hitting OPEC and foreign oil where it hurts most—their pocketbooks.

We have always been a target of those aligned with foreign oil, but now we have broken through. Unlike the dog track races where the mechanical rabbit is never caught, we have caught the rabbit, and that has sent a reality shock to these critics. As a result, their attacks are more frequent and even more misleading. It is important to keep this in perspective as we persevere with corn ethanol and next-generation biofuels. Oil companies are threatened by our success—if we don’t need foreign oil, it’s a game changer.

The unyielding heat and drought have provided new fodder for negative press.

With critics making inaccurate claims that ethanol is the reason for increased food costs, we must continue to set the record

14 | Ethanol Producer Magazine | September 2012

straight. The folly of this argument can be traced back to 2008, when the Grocery Manufacturers Association concocted a campaign to blame ethanol for increased food prices. The myth continues, even though objective studies have shown no substantial connection.

Using these arguments, the critics are calling for a change in the renewable fuel standard (RFS). The RFS was enacted with flexibility in mind, however, and free market forces are taking effect. Ethanol production has decreased, with some plants even temporarily ceasing production due to market forces. Less corn was being ground and production slowed, reducing barrels per day by roughly 100,000 in July.

During the month of July, there was nearly a billion gallons of excess ethanol, as well as over 3 billion renewable identification numbers (RINs) available, creating several options to ensure that the volume goals of the RFS can be met, while also meeting the obligations of the corn crop for feed.

As rumors shifted into high gear this summer, USDA Secretary Tom Vilsack went on CNN to dispel them, saying, “What really drives food prices more significantly are energy costs.” Vilsack then went on to criticize the price-gougers who are manipulating the drought as a means to raise prices at grocery stores nationwide. Additionally, at the height of the drought, the United Nations along with the Organisation for Economic Cooperation and Development released an agricultural report on the correlation between oil and commodity prices, stating, “Global agriculture is increasingly linked to energy markets… These higher oil prices are a fundamental factor behind the higher agricultural commodity price projections…”

To put things in perspective, in 2011,

ethanol production used only 3 percent of the global grain supply. Simply put, corn is an industrial feedstock—caloric energy converted from solar energy to starch, protein and fiber. There are a number of uses for corn, most notably as livestock feed and in ethanol production. And, more than one-third of every bushel of corn used in ethanol production is returned to the food chain in the form of the highly valued, nutritious animal feed, distillers grains.

Increased food prices are directly attributed to higher oil prices—it costs more to harvest, transport, process, refrigerate and package the goods that show up at your grocery store. And this summer, the driving force for the increase in commodity prices and futures was an act of Mother Nature—a lack of rain.

Now that we have “caught the rabbit,” it falls upon us to ensure we communicate our message, dispel myths and distorted facts and educate consumers with the truth. If it is not a drought, our critics will continually use some other illogical and misleading argument to try to discredit us and stymie our success. Growth Energy is proud to represent America’s producers and supporters of ethanol and will continue our campaign to educate the American people about the benefits of producing a lowcarbon, cleaner-burning fuel that is creating economic opportunity while reducing our addiction to foreign oil.

America needs an “all of the above” strategy to eliminate our dependence on foreign oil, and not an “all of the above, except renewables,” as proposed by our critics.

Author: Tom Buis CEO, Growth Energy (202)545-4000 tbuis@growthenergy.org

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The Fallible Pope

By Ron Lamberty

Sometimes it’s difficult to decide on a topic for this column.

Other times, a guy like C. Larry Pope comes along, and says something so outrageous, dishonest, and so transparently politically opportunistic, that the column practically writes itself. Pope is CEO of Smithfield Foods, one of the largest processors of hogs in the nation, and he recently wrote a Wall Street Journal editorial, entitled “The Renewable Fuels Standard is Worse than the Drought.”

Now, in fairness, maybe Pope was just angry because his company made only a third of a billion dollars this year, as opposed to the half a billion it made the year before.

Maybe he was stressed out trying to figure out how to make the mortgage payments and put food on the table since his annual compensation dropped by seven million dollars this year—to only $13.2 million. Or maybe, since the “RFS is worse that the drought” line was the title of the article, that was a WSJ headline, and it wasn’t an accurate indication of Pope’s actual opinion.

But since he hasn’t made any follow-up statements or clarifications, he must feel the headline accurately reflects his views. Which, I guess, means that if you said, “Hey, Larry, you get to choose what happens in 2013.

Drought or RFS?”

16 | Ethanol Producer Magazine | September 2012

Larry would apparently say, “I want a drought!”

Me? I would choose to not have a drought.

In the article, Pope says the RFS “requires that a certain volume of ethanol (15.2 billion gallons in 2012, mainly derived from corn) be blended into gasoline.” Mainly, in this case, means 13.2 billion gallons of corn ethanol. Pope either doesn’t know or doesn’t mention that actual ethanol use this year could be reduced by 3 billion gallons without making a single change to the existing RFS, if refiners apply excess renewable identification numbers (RINs) for gallons purchased last year, or use extra credits they get for buying ethanol that isn’t made with corn (like sugar cane ethanol from Brazil). That 3 billion gallon reduction of the RFS translates to a billion bushels less corn, but still meets the requirements of the RFS. Pope writes, “Ironically, if the ethanol mandate did not exist, even this year's drought-depleted corn crop would have been more than enough to meet the requirements for livestock feed and food production at decent prices.” While I am not sure how Larry knows how large the crop “would have been,” the actual irony is that the RFS he complains about is the only reason “this year’s droughtdepleted corn crop” could be large enough to meet those requirements.

Since the RFS was enacted, the average annual corn crop has grown from about 9.5 billion bushels to more than 12.5 billion bushels a year. That additional corn

was grown because new demand created by ethanol has made growing corn profitable for farmers. There is absolutely zero chance farmers would grow as much corn if the RFS didn’t exist. While Pope speaks longingly about the days of $2 corn, he has to know that farmers wouldn’t have planted 96 million acres with a crop that would lose them money, doesn’t he?

There is a reason that Larry Pope has opted to scare Americans into changing the RFS by writing a horror story for the Wall Street Journal rather than going through the process that was designed into the legislation to deal with situations exactly like we see in the United States this year. He and others just like him aren’t interested in facts or truth.

They are interested only in cheap corn, and they will say anything, twist any statistic, and take advantage of any circumstance—no matter how dire—to take profitable markets away from corn farmers and improve Big Food’s bottom lines.

Author: Ron Lamberty Senior Vice President, American Coalition for Ethanol (605) 334-3381 rlamberty@ethanol.org

Europe Calling

Food and Fuel: Back on the Table

By Robert Vierhout

The record summer drought in the U.S.A. is not good for global grain prices, but is a godsend for biofuel critics. As in 2007 and 2008, we are blamed for causing high food prices, but those who know the dynamics of the soft commodity market know better.

The absolute champion for criticizing biofuel policy is the chairman of the largest world food producer. Nestle’s Peter Brabeck positions himself as morally concerned over high food prices as a result of biofuels.

His real concern is, of course, reduced profit margins if prices go up. He needs a scapegoat to tell the world that it is the fault of biofuels and nothing else.

His most recent attack was in a July 17 BBC interview where he argues that: “If no food was used for fuel, the prices would come down again—that is very clear.” Yes, obviously. If Nestlé stops producing cookies, prices will go down as well. But that is not the point. If Mr. Brabeck would put today’s commodity prices into a historical perspective, he would have to acknowledge that prices are not at all-time highs, they are relatively low. Low prices are not a good incentive to increase production. Whether a farm is based in Africa or America, the farmer needs to make a living.

It is undeniable that more demand will increase prices at first, followed by more supply, and it cannot be ignored that biofuel

18 | Ethanol Producer Magazine | September 2012

policy will have an upward impact on prices.

It is highly questionable, however, that an additional demand that represents less than 5 percent of all cereals consumed globally can be called a price-setter. There has been enough evidence that this is not the case. For Mr. Brabeck, telling the true story why he doesn’t like biofuels is too painful.

It wouldn’t go down well with the Nestlé shareholders.

The chairman of Cargill is quoted in the same interview. He’s not a great biofuel fan either, but at least he puts things into perspective and underlines what is really driving commodity prices, things such as growing urbanization, more wealthy people eating more and different food and a decrease in investment in agriculture.

He also reminds us that much arable land, especially in Africa, is not being used. And, we Europeans keep taking arable land out of production. Where is the logic?

Other favorite critics such as Oxfam also see the present situation as a new opportunity to slam the EU biofuel policy.

The head of the EU office crucifies the policy in a July 16 article for the Financial Times. She indirectly blames the EU biofuel policy for the recent impeachment of the Paraguay president. She links conflicts over redistribution of land to the production of soy for EU biodiesel production. Soybeans are exported from Paraguay to Argentina and the oil is shipped to Europe. Knowing that soyoil is a coproduct of soymeal, the causality seems farfetched. Closer to the truth, the EU is importing high volumes of meal to feed animals, that, by the way, can

be almost entirely replaced by distillers grains from EU-produced wheat ethanol.

So more EU ethanol means less need to import soy meal and, hence, less soy to grow in South America. It’s an easy way to reduce land use. But, to acknowledge this or address the issue of large soymeal imports is not the preferred political message. Suggesting there are good biofuels, and addressing eating habits, is a too slippery slope. So, let’s keep it simple, let’s blame it all on biofuel.

For me, such criticisms are a symptom of opportunism, hypocrisy and reaction. The problems cited above cannot be resolved by abolishing the EU biofuel policy; that would be pure political symbolism without any structural impact. What is needed is a set of policies that address the root causes of the volatility in commodity prices and alleviate its effects, including stricter urban planning and controlled urbanization, more investment in agriculture and innovative farming practices, and building strategic reserves of grain to keep prices in balance as is done with crude oil, to name just a few. Land abuse could be easily addressed, too. The mandatory use of biofuels in the EU resulted in a strict set of mandatory sustainability criteria. Why not add criteria that would make it impossible to import biofuels that have been produced at the expensive of land grabbing?

Author: Robert Vierhout Secretary-general, ePURE Vierhout@epure.org

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business matters

JOBS Act Creates Opportunities

By Gregory Lynch, Porter Martin and Jeff Barrett

The Jumpstart Our Business Startups Act, the JOBS Act, which was passed by Congress and signed into law by President Obama earlier this year, could have a significant impact on how many traditionally farmer-owned biofuels companies are structured.

Many of the biofuels companies formed in the Upper Midwest in the late 1990s and early 2000s were started by local agricultural producers and investors. While this distinctive structure had many advantages, including a natural hedge against commodity prices and access to a large base of knowledgeable investors, securities and tax laws created compliance burdens for companies conducting their equity drives. Companies responded in one of two ways: they either formed a limited liability company (LLC) and registered their equity offering with the Securities and Exchange Commission, or a cooperative, which was exempt from initial SEC registration.

Companies that organized as LLCs and publicly registered their securities realized the benefits of being able to conduct a public offering to a large number of investors. After a successful equity drive, however, these companies were subject to the costs of being a publicly reporting company, which included hundreds of thousands of dollars annually in compliance costs, in addition to greater management distraction, increased liability and a loss of confidentiality. Companies that organized as cooperatives were able to avoid most of the SEC compliance costs, but at the substantial cost of significantly limiting their flexibility in obtaining corn supplies 20 | Ethanol Producer Magazine | September 2012

without incurring significant tax burdens. As a result of these challenges, many LLCs with SEC-registered equity securities decided to reorganize and deregister from SEC registration, or “go dark.” Similarly, many cooperatives decided to convert to an LLC structure to avoid tax and operating restrictions.

The process for both was similar.

Companies formed multiple classes of LLC equity securities with different voting and/or economic rights and then reorganized their members into these various classes so that no class of equity securities had more than 500 record holders (300 record holders for any class of equity securities that was previously registered with the SEC). In order for this to be effective, the differences in equity securities needed to be significant. For example, a company could grant different voting rights to members based on voting versus nonvoting units, the right to elect directors, the right to amend charter documents such as operating agreements or the right to approve fundamental transactions such as dissolution, merger or conversion.

While this type of reorganization is successful in deregistering a class of equity securities with the SEC, it has the cost of taking away voting rights that members previously held. Many companies and their shareholders voted in favor of deregistering with the SEC, however, because the benefits outweighed these costs.

The recently passed JOBS Act makes it easier for biofuels companies to experience the tax benefits of operating as an LLC without the compliance costs associated with going public.

The act raises the threshold for mandatory

registration under the Securities Exchange Act of 1934, as amended, from 500 shareholders to the lesser of 2,000 total shareholders or 500 shareholders who are nonaccredited investors.

As a result, the necessity of forming multiple classes of LLC equity securities in order to avoid registering with the SEC has been minimized. It is important to note, however, that the JOBS Act did not affect the threshold of 300 shareholders of record for nonbank holding companies. Thus, biofuels companies that are currently publicly reporting companies must get below 300 record holders of a class of full voting equity securities to “go dark,” but may have up to 2,000 shareholders of record (or up to 500 unaccredited investors) for other classes of equity securities that have not been previously registered.

The JOBS Act makes it easier for biofuels companies that are currently subject to SEC reporting to “go dark” or deregister with the SEC. Further, for biofuels cooperatives looking for a more flexible organizational structure, the JOBS Act makes it easier to convert to an LLC without being subject to SEC reporting. As a result of these changes, now may be a good time to consult your legal, tax and accounting advisors to determine whether your current organizational structure is still the optimal one.

Authors: Gregory Lynch Attorney, Michael Best & Friedrich LLP (608).283-2240 gjlynch@michaelbest.com Porter Martin Attorney, Michael Best & Friedrich LLP pjmartin@michaelbest.com (608) 283-0116 Jeff Barrett Attorney, Michael Best & Friedrich LLP jmbarrett@michaelbest.com (414).225-8294

business briefs People, Partnerships & Deals

™

ERI Solutions Inc. recently gained certifications in API 510, API 570, and API 653. The certifications allow ERI Solutions to provide the ethanol industry with required testing and inspections services to achieve OSHA and EPA compliance. To accompany these certifications, ERI Solutions has also employed an ASNT NDT Level III technician and a seasoned field service team with vast ethanol experience.

Blue Sugars Corp., formerly KL Energy Corp., has successfully completed the first phase of work program established under the joint development agreement (JDA) that it signed with Petrobras America Inc. in August 2010. The project has met all technology milestones and ethanol production targets to date. As a result, the two companies have elected to extend the scope of the agreement. Under the terms of the extended JDA, KLE upgraded its demonstration plant, expanded production process validations and added on-site yeast production capabilities. The facility now represents the design of future commercial plants, at a scale of 10 percent capacity.

Pasadena, Calif.-based Protabit LLC was awarded a Small Business Innovative Research Phase I grant from the National Science Foundation. Protabit, a spin-off of the California Institute of Technology, will use the funding to engineer cellulase enzymes for use in the production of biofuels using corn stover feedstock. The company is the developer of Triad, a computational protein design software platform that is used to generate new enzymes for experimental evaluations. Protabit engineers proteins for industrial, agricultural and healthcare applications. Its platform technology is being developed via a strategic partnership with Monsanto Co.

The U.S. Grains Council has selected Thomas Sleight to serve as its president and CEO, replacing the retiring Thomas Dorr.

Sleight initially joined the council in 1983 and has served in mulUSGC Leader tiple capacities in both Tom Sleight has 18 years of working for the Washington, D.C., and U.S. Grains Council. abroad. After working He has worked in the field as well as with for other agricultural communications, organizations, he remembership and administrative functions. turned to the USGC in late 2010 as vice president of operations and membership. Sleight’s cumulative service with the council spans 18 years. Although Dorr is retiring from day-today administrative duties, he will continue to work with the USCG on a part-time basis as a consultant focusing on a number of longrange initiatives begun during his tenure.

The USDA made four awards under the Rural Energy for America Program in late June to support the installation of blender pumps and flex fuel pumps. Under the funding round, ATJ Corp. received $15,551 for a blender pump in Florida, Down to Earth Retail #1/Rick Huszagh received $29,927 to install a blender pump in Georgia, Hometown Fuel Inc. received $59,040 to install blender pumps in Missouri, and Martins Inc. was awarded $7,696 to install a flex fuel pump in South Dakota. The REAP program was authorized by the 2008 Farm Bill.

Blender pumps became available for REAP grants last year, when a total of 65 projects, consisting of 266 blender pump installations, received funding.

22 | Ethanol Producer Magazine | September 2012

Aemetis Inc. has acquired Cilion Inc., along with its 55 MMgy ethanol plant in Keyes, Calif. The company plans to continue operating the corn ethanol plant as it pursues the next stage of its cellulosic ethanol development project. The plant was built by Cilion, and began operations in 2008. The facility operated for four months before being idled. Aemetis, formerly AE Biofuels Inc., leased the plant in 2010 and began upgrading the facility. The plant has run continuously since April 2011. Aemetis plans to transform the plant into a biorefinery capable of producing both biofuels and specialty chemicals, such as isoprene.

Cleantech company KmX Corp. is developing a 1-ton pilot plant in Sarnia, Ontario to demonstrate how its membrane aided pathways to cellulosic ethanol, biobutanol and green chemicals can reduce operational costs and complexities for manufacturers of fermented fuel and chemical products. The pilot project will demonstrate how KmX’s hydrophobic and hydrophilic membranes can cost effectively capture and dehydrate post-fermented alcohol molecules in the fermentation broth. The pilot will also demonstrate the company’s novel acidic hydrolysis process and demonstrate how the hydrolyzed sugar can be taken to a pre-crystalline state using KmX’s sugar enrichment process.

Global engineering, construction and services company KBR Inc. was awarded a contract for engineering and procurement services for DuPont’s first cellulosic ethanol plant in Nevada, Iowa. KBR will provide front-end engineering, detailed engineering and procurement services to DuPont’s Industrial Biosciences Group for the first-of-a kind plant. The ethanol facility is designed to produce 27.5 MMgy of cellulosic ethanol from corn stover feedstock. Construction on the new plant is scheduled to begin during the second half of this year. Once groundbreaking begins, the facility is expected to be complete within 12 to 18 months.

BUSINESS BRIEFS Sponsored by

Adam Sieminski is now serving as the administrator of the U.S. Energy Information Administration. As the EIA’s eighth administrator, Sieminski is responsible for directing the nation’s primary energy statistical and analytical agency. He formerly served as chief energy economist for Deutsche Bank, where he worked in the bank’s global commodities research and trading units. In a prior position at the bank, he served as director and energy strategist for the global oil and gas equity team. He has also worked for the Energy and Natural Resources Program at the Center for Strategic and International Studies, the U.S. Association for Energy Economics, and the National Association of Petroleum Investment Analysts. From March through May, while awaiting confirmation as EIA administrator, Sieminski served as a senior director on the staff of the National Security Council.

AdvanceBio Systems LLC is supplying its SuPR2G Bench Scale Pretreatment Reactor to the National Renewable Energy Center of Spain, where it will be used to conduct basic research and development work related to the production of fermentable sugars from lignocellulose-rich biomass feedstock. The reactor is a small-scale, continuous-feed reactor that is designed to overcome the limitations that bench-scale batch reactors present to the research community.

The technology employed by the reactor is a scaled-down version of technology deployed on a commercial scale in the pulp and paper industry. In addition to supplying bench-scale reactors for research purposes, AdvanceBio Systems is also capable of supplying commercial-scale reactors that can take in up to 200,000 dry tons of feedstock per day.

Novozymes and the China-based Shengquan Group have signed an agreement under which the two entities will work together to produce cellulosic ethanol from waste material produced via Shengquan’s operations. Novozymes is supplying enzymes for the project, while Shengquan is investing $100 million in a new facility in China, which is scheduled to begin operations this summer. The Shengquan Group currently produces furfural from corncob xylose. Cellulose from the corncob was previously discarded as waste. Using Novozyme’s enzymes, the company will now ferment that waste into cellulosic ethanol that will be marked as an industrial solvent.

South American agricultural company Adecoagro S.A. has announced that its sugar, ethanol and energy production cluster in Mato Grosso do Sul, Brazil, has been certified under the Bonsucro Production Standard. The company is the 16th worldwide to achieve the certification. During the certification process, more than 33,000 hectares of sugarcane were audited. The Bonsucro Production Standard is a global multistakeholder, nonprofit initiative focused on improving the social, environmental and economic sustainability of sugar, ethanol and energy production from sugarcane. The certification will allow Adecoagro access to new markets and allow the company to expand its commercial opportunities.

Alfa Laval Inc. has appointed Jeff Sharbaugh senior vice president of the parts and service division. In his new role, Sharbaugh is responsible for driving consistent profitable growth and developing new

sales opportunities for the parts and service business of Alfa Laval in the U.S. His responsibilities include leading parts sales, reconditioning services, field services and technical support activities in all of the company’s market segments. Sharbaugh joined Alfa Laval in 1987 as a product engineer. Prior to joining the company, he was employed

by Babcock & Wilcox and pressure vessel manufacturing companies.

The U.S. DOE awarded a five-year, $12.1 million grant to researchers at the Donald Danforth Plant Science Center and their collaborators at the Carnegie Institution for Science; the University of Illinois, Urbana-Champaign; the University of Minnesota, and Washington State University to develop a new model plant system, Setaria viridis, to advance bioenergy grasses as a sustainable source of renewable fuels. To engineering bioenergy grasses with the desirable traits needed for large-scale production, it is necessary to develop model plant systems that are closely related to bioenergy feedstock, but which are more amenable to genetic analysis. Setaria viridis, is closely related to corn and Brachypodium, which has a genetic makeup similar to wheat. iDiverse has discovered a yeast gene that, when inserted into yeast and properly modulated, can increase ethanol production yield by up to 34 percent. The gene protects the yeast against some lethal stresses found in the bioproduction process, and allows yeast to produce more ethanol in conditions with high acetic acid concentrations and low pH. The gene could help increase efficiency in both first-generation and cellulosic ethanol operations.

Share your industry briefs To be included in Business Briefs, send information (including photos and logos if available) to: Business Briefs, Ethanol Producer Magazine, 308 Second Ave. N., Suite 304, Grand Forks ND 58203. You may also fax information to (701) 7468385, or email it to evoegele@bbiinternational.com. Please include your name and telephone number in all correspondence.

September 2012 | Ethanol Producer Magazine | 23

commodities Natural Gas Report

Natural gas prices back away from the abyss July 23—Commodity markets have an uncanny ability to self-correct. Just when all the experts are sure that prices will move to infinity, something happens to stem the rise. Similarly, when prices are unusually low, experts often find reason to assert that low prices are here to stay and the markets find ways to prove them wrong.

Natural gas is experiencing the latter.

As summer progressed, storage fields filled and producers faced either further price discounting or shutting production. It hasn’t happened. Instead, as the chart shows, prices bottomed out at $1.90 per million Btu on April 20, moving up to $3.09 by July 20, a 62 percent increase. What happened? The first contributing factor was we came out of the winter with low prices reflecting an

unusually warm winter and record inventory. Second, incremental demand kicked in as natural gas prices dropped below coal in many regions, causing electric generators to switch. Third, drilling activity slowed.

Last, for most of the summer, storage injections have been considerably below average, causing concern that we may be moving from excess supply to excess demand, hence, a 62 percent market rally.

Weekly storage injections serve as a proxy for supply/demand. In summer when there is excess supply, gas is injected into stor-

By Casey Whelan

age to be withdrawn by winter demand. My sense is that as long as we have weak injections, prices will continue to strengthen until incremental capital moves back into drilling.

Corn Report

Weather dominates all aspects of market July 24—Drought conditions and record-breaking heat flipped the market to bullish. With the sharp rally above 2008 highs, the corn market is factoring in a sub-136 yield with ideas of it further shrinking. The USDA lowered the July supply/demand report’s corn yield by 20 bushels, from 166 in June to 146, a record drop during this time frame. As crop progress deteriorates to 1988 levels, USDA is likely to lower it further. Harvested acres are expected to decline as well from the typical 92 percent rate. In 1988, 86 percent of planted acres were harvested for grain and in 2002’03 it was 88 percent. Demand destruction is underway. Ethanol and livestock margins are under pressure as the corn market and basis have escalated. Livestock end-users have turned elsewhere, although soybean products have risen too, positively impacting ethanol coproducts.

BY JASON SAGEBIEL

With crop prospects declining, rationing will occur, slightly increasing old crop carryout and shrinking world corn supplies. In June, the USDA placed world corn carryout at 155.74 million metric tons, dropping it to 134.09 in July. Next-year exports are projected at 1.6 billion bushels, a reduction of 300 million bushels. The summer will remain volatile and weather around the globe will impact prices, too. The grain and oilseed balance tables cannot afford adverse weather in South America this winter or Australia this fall.

24 | Ethanol Producer Magazine | September 2012

The accompanying chart reflects the increase in poor to very poor ratings for the national corn crop through July 23, comparing this year to 1988. What have genetics and seed technology done since 1988?

report

Regional Ethanol Prices Front Month Futures (AC) $2.705 REGION

SPOT

RACK

West Coast

$2.885

$2.870

Midwest

$2.690

$2.750

East Coast

$2.800

$2.574 SOURCE: DTN

Regional Gasoline Prices

DDGS Report

Interest in wet cake up as DDGS prices hit new levels BY SEAN BRODERICK July 23—With corn reaching otherworldly heights, DDGS prices are seeing all-time highs, too. It is tough for the cash distillers market to keep up with corn futures. For the past month, all we heard was how many plants were idling or slowing production. Now, with the corn basis breaking and ethanol prices rallying, we hear more of better margins and plants speeding up. We should see a change in DDGS supply in August.

Domestically, we are still seeing a very strong nearby—as in, next week—with few buyers looking ahead. But with the condition of the corn crop, and especially in areas where it looks to be a washout, buyers have been more aggressive about buying out ahead. Interest in wet- and modified wet-cake is way up, with some plants doing five times more wet than in the past. Soymeal prices have skyrocketed, preserving DDGS value as a protein source as well.

In exports, there is still robust demand from the Chicago container market.

Given the lead times needed for container shipments, we saw a lot more demand for first half and last half August exports than we did domestically. Container prices are not leading the market, as in past months, but the time frame is a lot further out. Bulk markets remain the same as last month with DDGS more expensive than Gulf corn, and Gulf corn much more expensive than Brazilian corn. We do not expect any bulk exports, other than maybe a fill-in hold here and there.

If plants continue to increase run times, the DDGS price will degrade as a percentage of corn. But it will hold value, if corn starts to slip. From experience, the market is slow to move up, and slow to move back down.

REGION

SPOT

RACK

West Coast

$2.926

$3.009

Midwest

$2.876

$3.092

East Coast

$2.822

$3.012 SOURCE: DTN

DDGS Prices ($/ton) location

SEP 2012

AUG 2012

Minnesota

290

218

190

Chicago

295

239

205

Ethanol prices try to keep up with corn market rally BY RICK KMENT $5.50 per bushel to a current all-time market high of $8.24 per bushel. This surge in the corn crop creates added concerns about the availability of supplies not only for ethanol production, but the other two major categories of feed demand and exports. Although the current weather pattern is not showing any signs of relief, some are starting to wonder if demand will start to quickly crumble at these higher prices.

SEP 2011

Buffalo, N.Y.

282

230

230

Central Calif.

344

275

253

Central Fla.

299

240

240 SOURCE: CHS Inc.

Corn Futures Prices Date

(Sept. Futures, $/bushel)

High

Low

Close

July 24, 2012

8.15 1/2

7.74

7.90

June 25, 2012

5.91 1/4

5.65 3/4

5.91 1/4

July 25, 2011

6.83 3/4

6.71 3/4

6.78 3/4 SOURCE: FCStone

Cash Sorghum Prices ($/bushel) LOCATION

Ethanol Report

July 23—Ethanol futures have skyrocketed higher over the past month with front month ethanol futures moving from $2.06 per gallon on June 21, to $2.70 per gallon as of July 20. This 64-cent rally is a direct result of none other than the corn market spike seen through the month of July due to drought conditions through most of the Corn Belt.

In the same time period, September corn futures contracts have moved from

Front Month Futures Price (RBOB) $2.943

JuL 20, 2012

Jun 22, 2012

Jul 29, 2011

Superior, Neb.

7.31

5.40

6.56

Beatrice, Neb.

7.65

5.56

6.26

Sublette, Kan.

8.11

5.73

6.16

Salina, Kan.

7.63

5.61

6.75

Triangle, Texas

8.24

5.93

6.13

Gulf, Texas

7.46

5.62

7.04

SOURCE: Sorghum Synergies

Natural Gas Prices

($/MMBtu)

LOCATION

JuL 20, 2012

Jul 1, 2012

Aug 1, 2011

NYMEX

3.09

2.77

4.37

NNG Ventura

3.00

2.88

4.22

CA Citygate

2.96

2.89

4.34

SOURCE: U.S. Energy Services Inc.

U.S. Ethanol Production

(1,000 barrels)

Per day

Month

End stocks

May 2012

894

27,718

21,851

Apr. 2012

879

26,368

22,370

May 2011

895

27,756

20,387

SOURCE: U.S. Energy Information Administration

September 2012 | Ethanol Producer Magazine | 25

distilled Industry generates first cellulosic ethanol RIN

Ethanol News & Trends

Retail station registers with EPA as E15 retailer

2012 RFS Volume Requirements

Rapid City, S.D.-based Blue Sugars Corp. made history this year when the U.S. EPA confirmed the company had generated the first reBillion Billion Million newable identification number (RIN) Gallons Gallons Gallons for cellulosic ethanol in the U.S. The ethanol was produced at Western BiomassAdvanced Cellulosic Biomass Energy LLC, the companyâ&#x20AC;&#x2122;s based diesel biofuels Fuels subsidiary demo plant, last year as part of its development agreement with Petrobras SA. Total Renewable Fuels The cellulosic ethanol was 15.2 Billion Gallons shipped to Brazil for testing and used during the Rio+20 Conference. with Petrobras to do further work on process Petrobras used the cellulosic ethanol to fuel optimization. a minivan fleet serving the United NationsBlue Sugars, formerly known as KL Ensponsored international meeting on sustainable ergy Corp., recently underwent a name change development. to reflect changes in the companyâ&#x20AC;&#x2122;s operations Collaboration is continuing, as Blue Sug- over the past two years, and its new business ars has extended its development agreement focus on sugars.

8.65

1

2

Scaling back costs.

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The challenge.

A Midwestern ethanol plant relied heavily on sulfuric acid to lower pH. Unfortunately, acid availability was tight, driving costs up significantly.

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The savings. s 3AVED ON PLANT SULFURIC ACID USAGE RESULTING IN NET SAVINGS OF TO YEAR s 4EN #)0 S PER YEAR WERE ELIMINATED SAVING LABOR DOWNTIME AND CHEMICAL COSTS FOR ACID WASH s (YDROBLASTING FREQUENCY AND TIME WAS REDUCED s /VERALL HEAT TRANSFER PERFORMANCE HAS BEEN IMPROVED WHICH PROVIDES ADDITIONAL mEXIBILITY TO optimize water balance and backset usage. s ! REDUCTION IN $$' SULFUR CONTENT WAS OBSERVED

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4O LEARN MORE ABOUT OUR "ULABÂŽ SCALE CONTROL PROGRAM FOR EVAPORATORS OR HEAT EXCHANGERS

contact your local Buckman representative. Let us give you a story worth telling.

Š2012 Buckman Laboratories International, Inc.

In July, the Zarco 66 Oasis station in Lawrence, Kan. became the first retail gas station in the U.S. to offer E15 under the U.S. EPA waiver.

One week after becoming the first station to register with the EPA as a E15 retailer, the station held a grand opening, where consumers could fill up with E15 for only $1.15 per gallon.

Although the gas station previously offered E15 and other ethanol blends via blender pump prior to the waiver, it is now marketing E15 to all light-duty vehicles build since 2001. According to station owner Scott Zaremba E15, which he refers to as â&#x20AC;&#x153;Americaâ&#x20AC;&#x2122;s new choice in fuel,â&#x20AC;? is selling well, making up 16 percent of sales on the first day. â&#x20AC;&#x153;The percentages are moving up every day, as we educate the consumer about what we are doing,â&#x20AC;? he said. The company is working to offer E15 at a second station, also in Kansas.

distilled

Sorghum offers a sweet transition to next-gen feedstock A group of university scientists have found that first-generation ethanol producers looking for ways to transition to advanced biofuel production might find an easy â&#x20AC;&#x153;inâ&#x20AC;? with sweet or biomass sorghum. The researchers examined how existing biofuels infrastructure could be used for second- and third-generation biofuel production. Sorghum was highlighted in the study as a bioenergy crop that is particularly well-suited for use in existing facilities.

The study suggests that sorghum could be transported by existing rail lines from harvest locations to collection points such as grain elevators. From there it could be densified before being transported to the biorefinery for further processing. The analysis also points out that farmers might be more willing to grow annual energy crops, such as sorghum, rather than a perennial crop.

Scientists from Purdue University, the

2012

6,210,000 acres

Total U.S. sorghum 2011 5,481,000 area acres planted

* Data sourced from USDA National Agricultural Statistics Service

University of Nebraska-Lincoln, the University of Illinois and Cornell University contributed to the study, which was published in the scientific journal Biofuels, Bioproducts & Biorefining.

Heat-tolerant bacteria could help degrade cellulose Key proteins identified in a family of bacteria may help microbes grab onto plant material in order to better degrade it. The discovery was made during the examination of eight species of bacteria in the genus Caldicellulosiruptor, which are known for their ability to work at high temperatures.

The work, led by the U.S. DOEâ&#x20AC;&#x2122;s BioEnergy Science Center, found that among the genus, some of the bacteria contain a previously uncharacterized group of proteins called adhesins, which helped researchers understand why certain bacteria were better at breaking down plan material than others.

The researchers assumed that the enzymes would stick by chance to cellulose or a piece of biomass, but are seeing that a lot of proteins are involved in maintaining the interface between the bacterium and cellulose.

distilled

Long-term study finds yields not impacted by prescribed residue removal Average corn grain yields as affected by stover harvest treatments

Conventional - no removal

3-year average yield (2008-2010) bu/acre

Recent soil data collected as part of Poet LLC’s Project Liberty continues to demonstrate that harvesting crop residue can be a responsible part of good farm management. As part of its development activities, Project Liberty has commissioned soil sustainability work from researchers in Iowa State University and the USDA for the past four years. They have studied six different harvest methods in an effort to provide area farmers with data to help them make decisions about biomass harvesting.

According to researchers leading the project, removing residues at the levels recommended by Poet-DSM Advanced Biofuels LLC does not reduce yields. In addition, the rates are well within the sustainability limits.

Poet-DSM contracts with participating farmers to supply approximately 1 ton of biomass per acre, or less than 25 percent of the available aboveground biomass. The company is contracting for 85,000 tons this year. Once operational, Project Liberty will require 285,000 tons of biomass per

Cob only

MOG - POET Method

Two-pass bailing

STS Low-cut

0

50

100

150

200

* Data sourced from POET-DSM Advanced Biofuels LLC

year. The plant is scheduled for completion in 2013.

28 | Ethanol Producer Magazine | September 2012

Gevo produces isobutanol, plans cellulsoic production Gevo Inc. has produced measurable amounts of biobased isobutanol at its first commercial-scale facility, a retrofitted corn ethanol plant in Luverne, Minn. “We’ve shown that we can successfully ferment isobutanol in 250,000 gallon commercial fermenters, isolate the product and get it into tanks and railcars,” Gevo CEO Patrick Gruber.

The plant will not immediately begin producing at nameplate capacity, however. Rather, Gevo expects to spend most of this year working out the kinks of the process.

Gevo has also signed a joint development agreement with Beta Renewables, a Chemtex and TPG joint venture, to develop an integrated process for the production of cellulosic isobutanol.

distilled

Ethanol production stagnant, but poised for growth The U.S. DOE’s Energy U.S. ethanol use in blended gasoline and Information Administration’s E85, 2000-2035 (billion gallons per year) Annual Energy Outlook 2012 History 2010 Projections 20 projects that E85 use will grow to represent a 37 percent share of domestic ethanol production by 2035. The 15 report examines the probable Blended ethanol impact of new corporate average fuel economy (CAFE) 10 standards as the nation’s lightduty vehicle fleet turns over to newer, more efficient models, 5 finding that flex-fuel vehicles E85 are expected to represent 17 percent of new vehicle sales.

0 That is the largest share of 2000 2005 2010 2015 2020 2025 2030 2035 all vehicles during the time * Data sourced from U.S. Energy Information Administration period.

The annual outlook also fuel standard, recent data shows that weekly shows biofuel production ethanol production is down compared with growing by 800,000 barrels (33.6 million galrecent year’s statistics. In July, the EIA estimatlons) per day from 2010 to 2035. Ethanol is ed that weekly ethanol production level had expected to account for 700,000 barrels of reached its lowest levels since the administrathat increase. tion started tracking ethanol production data While the Annual Energy Outlook 2012 in 2010. However, the U.S. ethanol industry is shows ethanol production increasing in the still on track to be a net exporter of ethanol in long term due to the impact of the renewable 2012, although at lower levels than last year.

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Dual microbe platform produces ethanol, biobased hydrogen In nature many types of bacteria work together to degrade cellulose. Researchers at Michigan State University are taking advantage of this synergistic type of system and culturing two bacteria within the same system to produce two fuels, ethanol and hydrogen. The first bacterium breaks down and ferments agricultural waste into ethanol, while the second removes waste fermentation byproducts while generating electricity. Electrons produced by the second type of bacteria are moved via a wire from the fermentation vessel into another chamber where pure hydrogen is produced.

The synergistic activities of the two bacteria increase the energy produced from the ethanol alone, which is about 56 percent of the total energy available in the substrate, to about 73 percent when the cogeneration of cathodic hydrogen is added.

The research team has evaluated the process on the bench scale to date, and intends to scale up operations in the future. In addition to industrial scale applications, the process might be feasible on a farm scale where agricultural wastes and waste waters could be used to power vehicles and hydrogen could be stored for fuel cells to power household and farmstead electrical needs.

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OPTIMIZATION

32 | Ethanol Producer Magazine | September 2012

OPTIMIZATION

Optimal

Yield: A Moving Target A relentless focus on yield requires vigilance and nimble decision making.

By Holly Jessen

Leading ethanol producers can wring out 2.8 gallons of ethanol from a bushel of corn. Others settle for reduced revenues due to lagging yield. What are the characteristics of the most effi-

cient ethanol producers, and what can producers on the other end of the spectrum learn from them?

Neal Jakel, general manager of Illinois River Energy LLC in Rochelle, Ill., is a firm believer that to make money, an ethanol producer must be willing to spend money. The company always has its eye on new technologies and has made multiple improvements to the plant since it was built. “You have to invest if you want to improve the process,” he says. “The base ethanol plant was a great entry level design. It was not well optimized and … to continue to push these plants you have to invest the capital.”

With minimum capital, the company has increased from 102 MMgy to 120 MMgy while also increasing yield from 2.77 gallons denatured ethanol per bushel

PHOTO: DUPONT, COPYRIGHT 2012, ALL RIGHTS RESERVED

September 2012 | Ethanol Producer Magazine | 33

OPTIMIZATION

‘We’ve been running for yield optimization Champion hammermills have become the standard in the dry-grind ethanol industry.

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since the first of the year, and still are today.’

-Neal Jakel, general manager of Illinois River Energy LLC

to 2.82 gallons, Jakel says. That includes additional hammer mill capacities for a better grind profile and beefed-up distributive control systems. “We can track every single flow meter and pump and all those details so we know exactly what is going on in the plant,” he says. “The key thing here is you’ve got to have the data to really make the correlation.”

The list continues with the addition of a custody transfer scale to accurately measure corn before it is ground up and mass flow meters to measure exactly what concentration of thin stillage is backset. Efforts to maximize energy and heat recovery have paid off too. “Even though we had 100 degree weather [in early August] we still were able to run 120 million gallon rate at our plant—we didn’t have to slow down at all,” he says. “And that’s another key to yield … making sure you don’t put your yeast to stress because you definitely inhibit the yield performance.”

Evaluating new technologies isn’t easy, adds Hans Foerster, director of marketing for grain processing for DuPont’s biorefineries business. He’s noticed that the best producers typically exchange ideas with their peers and ask questions. “By having a network of partners with whom you can assess ideas together, plants come to a better set of answers than they do merely relying on the folks that are trying to sell them something,” he says.

“That’s one of the things you will see among the folks that have been in the industry the longest.”

Constant Obsession

The quest to find an ethanol plant’s yield sweet spot isn’t about nailing down a magical number and then staying there. Forester tells EPM the best run ethanol plants have a constant obsession with improving their facilities. “Yield improvement—in a fermentation

Annual Undenatured Ethanol Yield 2.85 2.80 2.75 2.70 2.65

2.78 2.73

2.71

2.69

2.79

2.78

2.80

2.77

2.74

2.72 2.67

2.67

2.68

2.64

2.63

2.60 2.55 2.50 2007

2008 Average

Sales@CPMRoskamp.com

34 | Ethanol Producer Magazine | September 2012

SOURCE: CHRISTIANSON & ASSOCIATES

2009 Leaders

2010 Laggards

2011

OPTIMIZATION

The Cost of Lagging Behind Data on ethanol yield from Christianson & Associates PLLP puts average yield from a bushel of corn at 2.74 gallons of undenatured ethanol. Digging deeper, however, shows a gap of about 0.177 gallons between the producers with the highest and the lowest ethanol yield numbers. Of the 62 ethanol producers participating in Christianson & Associatesâ&#x20AC;&#x2122; benchmarking program in 2011, the top five plants with the highest ethanol yield produced an average of 2.847 gallons of ethanol.

In contrast, the plants in the bottom five had yields of 2.67 gallons, the company told EPM.

Minnesota and Indiana were the states with the highest average ethanol yield at 2.81 and 2.803 gallons per bushel.

Separating the top 25 percent and bottom 25 percent into leaders and laggards clearly illustrates the financial impact of lower yields. The leaders had a $2.28 million revenue benefit over the plants with average ethanol yield and the laggards had a $2.62 million disadvantage compared to the average.

This was calculated for a 60 MMgy ethanol plant with an average feedstock cost of $6.45 a bushel.

Undenatured Ethanol Yield Gallons/Bushel 2.85 2.80 2.75 2.70 2.65 2.60 2.55 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 08 08 08 08 09 09 09 09 10 10 10 10 11 11 11 11 Average

Leaders

Laggards

SOURCE: CHRISTIANSON & ASSOCIATES

September 2012 | Ethanol Producer Magazine | 35

OPTIMIZATION

process, in particular—it’s an ongoing process, frankly that never ends,” he says. Ethanol producers can’t afford to ignore this vital piece of the puzzle—especially in a tight margin environment. “It’s the difference between being able to continue to operate and shutting down,” he adds.

Another reason the sweet spot is a moving target is that conditions in the financial marketplace are constantly changing. Jakel, educated as a chemical engineer, makes a distinction between running for gallons and running for yield maximization. Contrasting the conditions at the end of 2011, when commodity margins spiked more than $1 per gallon, and the extremely tight margins of this year perfectly illustrates why producers need to have the ability to assess and adapt quickly. “We had record, record production fourth quarter— every plant was running as hard as they could,” he says. “Yield did not matter at that point, just pure gallons out the back end, regardless of your variable costs, regardless of your yield losses. The actual physical gallons out the door were the huge financial driver.”

When that situation shifted, the industry took about four months too long to adjust the plan of attack and just kept pushing out the gallons, Jakel tells EPM. That led to a major hangover with an oversupply of ethanol in the marketplace and collapsed commod-

ity margins, he said Illinois River Energy, on the other hand, used a financial model it had spent months developing to determine that it was time to cut production by about 7 percent and focus on maximizing the amount of ethanol it could get from a bushel of corn. “We knew right away when we started running the numbers that running max gallons in January made no sense from a financial point of view,” he says. “We’ve been running for yield optimization since the first of the year, and still are today.”

The Data Difference

Illinois River Energy recently ramped up efforts in data collection and analysis. In the past year, the company hired an intern with a background in statistics to analyze the data from every fermentation since the plant began operation—more than 5,000 in all. The information was entered into a newly purchased data historian program, less about 25 percent, which was thrown out due to incomplete data.

The goal, Jakel says, was to determine which of the dependent variables had the greatest correlation to yield. The answer wasn’t surprising but it has helped the ethanol plant make better decisions and bring in more money. “We now have a graphical equation, a line equation that basically tells us that the No. 1 dependent variable is solids loading,” he says. “We know

that as our solids loadings increase, our yield efficiencies go down.”

In mid-August, for example, the ethanol plant was running at 33 percent solids, with a yield of 2.82 denatured ethanol—about a 120 MMgy run rate. “If we start going too high, yeah, we’ll get more gallons out of the plant,” he says, “but they are going to be less efficient gallons so it will be more costly and the commodity margin isn’t there today.” If the plant drops to 32 percent solids, yield jumps slightly and production goes down. Having this information hasn’t meant constant changes. In fact, in eight months, the company adjusted solids levels only three times. “We don’t jerk it around, so to speak,” he says. “It takes probably two weeks to make a significant change, [so if] we want to change by 1 percent Data Driven Jack Rogers of solids it’s going to take Novozymes says the us two solid weeks to company has been working on several tools kind of get the water for yield optimization and everything baland will have more announcements soon. anced back together.”

Notably, the variable with the second highest correlation to yield is total fermentation time.

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OPTIMIZATION

The next step was integrating the yield data with a financial model that takes into account all the variables. That includes factors such as corn pricing, corn basis, natural gas prices and variable costs in chemicals and enzymes, depending on the yield strategy. “We wanted to generate a robust financial model based on this operational model that tells us—given a certain financial situation—where should we be running the plant,” Jakel says.

“This helped us hone in and really get down to within a half a penny on a commodity margin numbers to help us make better-informed financial decisions.”

Since it was developed, management has used the model to run various scenarios and make decisions a couple times a month, Jakel says. For example, the information helps Illinois River Energy decide what to do during any operational challenges, such temporary loss of its distillers grains dryer due to a broken conveyor. In the past, the ethanol plant would have continued production and simply turned out wet cake, despite the fact that the product is discounted compared to dried distillers grains. “Right now, given the tight market conditions and the premiums we see on distillers grains, if we have any operational challenges in our plant we will not make wet cake,” he says.

“We’d rather shut down and make less gallons currently.”

Novozymes agrees that data gathering has an important role in increasing yield. “In addition to our new product development efforts, where we see enzymes still having a lot of potential to further increase yield,” says Jack Rogers, Novozymes North America Inc.’s bioenergy marketing manager for the Americas, “we have put a lot of resources into the analytical side of measuring yield and then adjusting either enzyme usage or plant conditions in order to maximize the conditions you are getting.”

In the past year, Novozymes has been working on several new tools and services that have been used to increase yield by 1.5 percent or more. Specifically, Rogers outlined progress with three service-marked offerings— Insight into Dextriantion, known as InDex, Neural Network Model and Novo Golden Batch.

The first two help increase yield by optimizing enzyme dosing. InDex goes beyond looking at dextrose equivalent to measure liquefaction by quantifying the amount of starch going into the solution to optimize alpha-amylase dosing. The company recently launched this product by performing analysis for its customers and, in the future, hopes to provide producers with software so they can do it on their own, Rogers says.

The Neural Network Model, on the other hand, aims for glucoamylase optimization. This

predictive model aids in selecting the best type and amounts of glucoamylase, depending on unique plant parameters. “What we have seen is that just by adjusting the dosing scheme, we have been able to—for some of our customers—achieve yield increases greater than one percent,” he says. “So it’s not necessarily adding more or less glucoamylase, it could just be adjusting the timing of it going in.”

Finally, there’s the Novo Golden Batch, a statistical process control tool that uses a datadriven approach to increase yield. This offering may use the Neural Network Model as well as other statistical and mathematical modeling to identify and increase the number of highyield fermentation batches. It helps producers by developing control charts to monitor the process to single out events, such as stuck fermentation due to a temperature spike. “By using these control charts and knowing where the variation is, you can make changes in the process to eliminate the source of the variation,” he says. “The idea is that you are reducing or eliminating the source of poor batches, so you are getting more well performing batches, or golden batches, by this measurement process.”

Author: Holly Jessen Features Editor of Ethanol Producer Magazine (701) 738-4946 hjessen@bbiinternational.com

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rjones@ferm-solutions.com September 2012 | Ethanol Producer Magazine | 37

RECOVERY

Measuring Flows Adam Anderson, ICM product manager, prepares a monometer for taking a vapor flow reading.

PHOTO: ICM

38 | Ethanol Producer Magazine | September 2012

RECOVERY

Stop Loss Not all ethanol leaving the fermenters goes to the tank.

By Susanne Retka Schill

Ethanol yield is often judged by what ends up in the tank farm but there’s plenty of places in the corn-to-ethanol process where small amounts of ethanol can be lost. In a tight margin environment that’s worth going after.

For some time, ICM Inc. has fielded questions about whether the ethanol found in the CO2 scrubber bottom waters is actually recycled and recovered.

“ICM and part of the industry had the belief the ethanol in the CO2 scrubber recycles. So every plant has this continuous recycled flow that isn’t necessarily lost,” says Adam Anderson, product manager. The questions persisted, though.

“About a year and a half ago we took on the task to come up with a way to get a study done to quantify whether ethanol truly is lost.”

Indeed, they found some ethanol is lost in the recycling of process waters.

The question was also asked: just how much ethanol is being lost in venting process tanks? ICM process engineer Mareus Lopez helped design the tests to answer those questions. “We did a mass energy balance before and after the cook water tank,” she explains. They measured the ethanol flow going into the cook water tank and the ethanol in the water coming out, and also analyzed other relevant process streams.

Cook water is stored in a tank that receives all sorts of process water being recycled through the plant. Fresh water is added and mixed with ground corn in the slurry tank and enzymes are added for liquefaction and saccharification— turning corn starch to glucose, the food for yeast. As living cells, yeast consume glucose to make ethanol as well as a lot of CO2. Roughly one-third of the corn

September 2012 | Ethanol Producer Magazine | 39

RECOVERY

Ethanol In CO2 Scrubber Bottoms

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40 | Ethanol Producer Magazine | September 2012

becomes ethanol, one-third CO2 and onethird unconverted solids, the coproduct distillers grains. Ideally, all of the ethanol leaves the fermenter as a liquid and is purified in the distillation process, but in reality, ethanol remains in the other process streams, which is what ICM sought to quantify.

Fermentation gases are passed through the CO2 scrubber, a large, columnar vessel where water washes through a filter medium as the gas moves through, scrubbing the ethanol, and a small amount of other compounds, out of the CO2. The scrubber bottom waters are then sent to the cook watertank to be recycled through the process.

Other sources of ethanol come from the backset (water removed from the solids in the evaporators) and sidestripper bottoms from distillation. Six ethanol plants, ranging in size from 40 MMgy to 60 MMgy, cooperated with the ICM team to test the actual ethanol in the various process streams.

By far, the largest source of ethanol being recycled through the process comes from the CO2 scrubber bottoms. The average ethanol content in the scrubber bottom waters at the six plants was 2.7 percent by weight/volume. With every ethanol plant running a slightly different flow rate of water through the scrubbers, the accompanying chart shows the calculated ethanol flow in gallons per hour (gph) on the vertical axis in relationship to various CO2 scrubber water flow rates in gallons per minute (gpm) on the horizontal axis. â&#x20AC;&#x153;The chart is showing for a plant running 60 gpm water, a good estimate would be they would have about 90 gph of ethanol flow out of their CO2 scrubber,â&#x20AC;? Anderson points out. â&#x20AC;&#x153;This is not ethanol loss,â&#x20AC;? Anderson adds. â&#x20AC;&#x153;That water is going to flow to the cook water tank and on to slurry tank.â&#x20AC;? In theory, that ethanol would just move through the process and have another chance of being distilled off. But, the ICM mass energy balance tests of the ethanol going into and out of the cook water tank showed an ethanol loss of as little as 21.3 gph or as high as 82.2 gph, with an average of 49.1 gph loss in the six plants. â&#x20AC;&#x153;If not all the ethanol is coming out, where is it going?â&#x20AC;? Lopez asks, adding that it could be through the slurry vent or

RECOVERY LDCommodities.com

consumed by bacteria. In the end the conclusion was that the main cause of ethanol loss is due to bacteria.

Loss in the cook water tank was the easier one to calculate, Anderson adds. Far more complicated was devising a method to measure the ethanol content and possible losses from vents on the slurry and centrate tanks as well as the distillation vent. “Those were the much more difficult ones to verify,” he says. Both the slurry and distillation vents are routed to the top of the centrate tank where all three vapor flows move on to emissions control. It is in the thermal oxidizer or regenerative thermal oxidizer (RTO) that volatile organic compounds are burned off to eliminate dust and smelly emissions.

With a bit of experimentation, the ICM team devised a method to pull vapor samples, and quantify the sample and the flow in the pipe.

“We used a vacuum to pull a sample from pipes, running the samples through a water bath,” he says. Most of the ethanol loss from venting came from the distillation vent, with an average of 14.2 gph. The slurry vent was much smaller at 4 gph, putting total average centrate vent loss at 18.2 gph. The range for the six plants was from a 10.8 gph minimum to 26.3 gph maximum of ethanol in the vapor flows moving through the centrate vent.

To do the math, adding the 49.1 gph from the cook water tank loss to the 18.2 gph centrate loss results in about 1,600 gallons lost per day for every 50 MMgy produced at the six plants—about a 1 percent loss. “If you hear 1 percent, it doesn’t sound really bad,” Lopez says, “but if you take into account the revenues you get for a gallon of ethanol and talk about 67 gph, it is significant. If you figure per month or per year, it is alarming,” Lopez says.

Once the losses were quantified, the challenge for the ICM team was to see if they could devise a cost-effective solution. A rather simple piping change and rerouting of the CO2 scrubber bottoms water to enter into the cook water tank discharge eliminates the stream’s exposure to ethanol-eating bacteria. That still recycles the ethanol, though, so the team decided to see if they could find a way to economically recover it. With a two-year payback in mind, Anderson says they set $150,000 as the price point. “The potential loss

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Ethanol Loss Results / Data Summary • CO2 Scrubber Bo�oms Average = 2.7% ethanol by w/v • Cook Water Tank Average Loss = 49.1 GPH • Centrate Vent Average Loss = 18.2 GPH • Slurry Vent Average Loss = 4.0 GPH • Dis�lla�on Vent Average Loss = 14.2 GPH

Source: ICM

September 2012 | Ethanol Producer Magazine | 41

RECOVERY

Scrubber Solution Kansas Ethanol operations Thane Combs says after running the system for some time, the plant is recovering about 700 gallons more per day that was once recycling through the plant, or lost.

PHOTO: Kansas Ethanol

of the ethanol in the CO2 scrubber bottoms and the slurry vent are areas where plants are limited on operational or simple piping project options,” he explains. “We wanted to see what could be done for that amount of money and that eliminated some of the high price tag items such as an additional scrubber or something inappropriately more extravagant.” Instead, they route the scrubber bottoms water through a heat exchanger for preheating and introduce it into one of the distillation columns capable of handling the extra flow. The changes bring the cook water tank loss to zero and the slurry vent average from 4 gph to less than 0.5, thus dropping the centrate vent average loss down to around 14.5 gph.

Kansas Ethanol LLC is one of the six plants where the testing was done, and the first to install ICM’s recovery solution commercially. Down the road a little over an hour

Call

from ICM’s Colwich, Kan., headquarters, the 55 MMgy ethanol plant has frequently worked with ICM’s team on various projects, says operations manager, Thane Combs. “The goal here has always been to be as efficient as possible in every aspect of our plant,” he says, adding that the company consulted ICM about this issue, suspecting ethanol losses due to the tank environment.

It was calculated that the scrubber bottom discharge was roughly 2 to 2.5 percent ethanol, Combs says. With 50 gpm of water being sent to the CO2 scrubber, there is about 1 to 1.5 gpm of ethanol being washed out.

“Most plants are designed where that went to the cook water tank and then into the slurry at 185 degrees,” he points out. “So you are most likely flashing a pretty good portion of that off. Of course, that goes to the centrate blower and you’re just burning that up in the RTO.” There’s no doubt Kansas Ethanol’s RTO runs cooler since the system was installed.

Using natural gas to add to the heat generated from the burning emissions, the plant’s RTO is supposed to maintain 1,600 degrees Fahrenheit. “Before we put this system online, there were times that the gas would shut off to the RTO, when it was burning in excess of 1,600 degrees,” Combs says.

Anderson adds that when ICM reviewed the cost analysis for possible solutions, one of the factors considered was the energy contributed by ethanol vapor being oxidized in the RTO. “But ethanol is worth 10 times more than natural gas,” he says.

For Combs, the ethanol recovery project has been worth it. “It’s hard to measure and say [the loss] is zero,” Combs says. “We are seeing 700 gallons per day additional ethanol when it’s running compared to when it’s off.

If you run the numbers, there’s approximately 1,400 gallons that are in the scrubber bottom waters.” He adds that at first they saw more ethanol recovery, “but the longer you run it, the system balances out and you’ve got less recycled ethanol throughout the plant.”

Author: Susanne Retka Schill Contributions Editor, Ethanol Producer Magazine (701) 738-4922 sretkaschill@bbiinternational.com

42 | Ethanol Producer Magazine | September 2012

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FERMENTATION

44 | Ethanol Producer Magazine | September 2012

FERMENTATION

A new yeast product promises to save producers pennies per gallon when pennies count the most.

By Kris Bevill

In a margin environment with high corn prices, relatively low oil prices and stagnant consumer demand for gasoline, the ethanol industry has borne witness to razor thin margins. The crunch has caused everything from slowdowns to temporary full shutdowns as producers wait for prices to even out and attempt to pinpoint where they can squeeze even the smallest of profit increases out of each gallon of fuel they produce. It wasnâ&#x20AC;&#x2122;t always that way for the ethanol industry. A decade ago, ethanol producers may not have considered that type of incremental changes, but these days, a boost of even half a cent per gallon could make the difference between an operational or idled ethanol plant.

Enter Mascoma Corp. While widely known for its proposed cellulosic ethanol production plans, Mascoma is a technology development firm with a few more tricks up its sleeve. Its specialty is a proprietary consolidated bioprocessing (CBP) platform. CBP is a conversion process in which microorganisms are used to hydrolyze and ferment sugars in one step, as opposed to traditional processes, which require enzymes to hydrolyze sugars and separate microorganisms to carry out fermentation. By definition, CBP requires the use of engineered microor-

September 2012 | Ethanol Producer Magazine | 45

FERMENTATION

ganisms because natural organisms are not capable of simultaneously performing both functions, according to Mascoma.

As Mascoma developed its CBP process, it engineered a yeast that can be applied in corn ethanol plants and has been proven to cut operating costs by reducing the plant’s enzyme requirements. The Mascoma Grain Technology yeast product, commercially known as TransFerm, is the first commercial application of the company’s CBP technol-

ogy and is a drop-in, bioengineered substitute for conventional yeasts used in ethanol fermentation. Because the yeast itself expresses glucoamylase enzymes, it significantly reduces the amount of enzymes that would otherwise need to be purchased for ethanol production, according to the company. The reduced need for enzymes translates to a gross savings of 1 to 2 cents per gallon, says David Arkowitz, chief financial officer at Mascoma. “We’re replacing a significant amount of dollars that

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46 | Ethanol Producer Magazine | September 2012

it costs to produce ethanol because the yeast makes its own enzymes,” he says.

TransFerm was introduced to the market during the first quarter of this year but the product has already been used in more than 1,000 fermentations to produce more than 90 million gallons of ethanol at 15 ethanol plants, according to Mascoma estimates.

That total includes six commercial customers as well as additional potential customers who are conducting trial runs to test the product at their facilities. The yeast is manufactured and distributed by Lallemand Ethanol Technology, which entered into a multiyear partnership with Mascoma in December to commercialize the product. Mascoma and Lallemand jointly market and sell TransFerm. As part of the agreement, Lallemand pays Mascoma a technology license fee and receives a portion of the net sales based on the market price of conventional yeast, as well as ongoing incentive payments based on sales performance.

This is the first bioengineered yeast Lallemand Ethanol Technology has marketed at a commercial level, according to Craig Pilgrim, Global Marketing and Product Development Manager. “We’ve been involved in a lot of small incremental changes in the past,” he says. “You can only push biology so far and then you have to take the next step. For us, it’s great to see this product out there. It really is quite a step-change from what it was before in terms of savings and performance, so it’s very exciting for us to be involved, not only in partnership with Mascoma, but for the industry overall.”

Arkowitz says the product is still in the early days of availability, so it’s difficult to predict how many ethanol producers will be using the product by years end. For now, the companies are content to grow sales in a manageable fashion and continue to optimize the product. ICM Inc. signed on as Mascoma’s technology development partner in October and provided scale-up assistance and industry expertise to bring the product to market. Now that it has been introduced, the engineering firm is continuing to run lab tests and conduct other related work, Arkowitz says. The first few months of commercial operations have been positive, and the companies are very pleased with TransFerm’s

FERMENTATION

performance thus far. “We’ve seen significant interest in this product,” Pilgrim says. “Margins are very, very tight so any kind of savings—especially in the 1 to 2 cents per gallon range—is a pretty good deal for them.”

Valero Renewable Fuels Co. LLC, a Mascoma investor, was the first ethanol producer to sign up to use the engineered yeast product. The company signed a multiyear agreement with Mascoma in November that provides Valero with terms and pricing for TransFerm’s use at any or all of Valero’s 10 corn ethanol plants. Bill Day, Valero’s executive director of media relations, declined to elaborate on the specifics of the agreement but he confirmed that Valero has trialed the product at several of its facilities and will continue to work with Mascoma and others to optimize the results.

In March, Pacific Ethanol Inc. also signed an agreement to use TransFerm at its 40 MMgy Columbia plant in Boardman, Ore., with the option to extend that agreement to include the company’s three additional ethanol facilities. Paul Koehler, Pacific Ethanol vice president, says the Columbia plant has experienced positive operational and financial results in the months since incorporating the new yeast into its process. “It has lowered our ingredient costs for production and is consistent in its performance,” he says.

“Pacific Ethanol is pleased with the product and with the team from Mascoma and Lallemand.” Koehler says Pacific Ethanol does indeed plan to use the product at all of its facilities, pending trials at each plant to confirm the expected benefits.

change their processes. We mean it when we say ‘drop-in.’ They can just use it instead of using a conventional yeast.”

Mascoma intends to continue using its CBP technology platform to improve TransFerm as well as roll out additional products.

The next step will be to introduce MGT 1.1, which is designed to express glucoamylase enzymes as TransFerm does but with the additional capability of generating additional yield for corn ethanol producers, according

to Arkowitz. Mascoma is awaiting regulatory approval for MGT 1.1 and anticipates launching the product in the not too distant future, he says. In the meantime, Pilgrim assures there’s no need for producers to wait for the new and improved version to become available. “You could wait,” he says, “but you’d be leaving money on the table.”

Author: Kris Bevill Ethanol Producer Magazine (701) 746-8385 kbevill@bbiinternational.com

Operational Considerations

Bioengineered yeasts require users to complete a bit more paperwork as compared to natural yeasts and Mascoma needed to garner a favorable review from the U.S. Food and Drug Administration before distillers grains produced at facilities using the yeast product could be used as animal feed, but the actual production process is unchanged. The FDA gave the product a favorable review in February. “For use in trials or commercial use, the facility itself doesn’t have to do anything differently,” Arkowitz says. “They don’t have to invest in any capital equipment or September 2012 | Ethanol Producer Magazine | 47

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ENERGY

CONTRIBUTION

Holding Firm A steel structure was designed to support the addition of a custom-designed shell and tube heat exchanger in the RTO for Ace Ethanol.

PHOTO: KINERGETICS

Tapping into a Heat Recovery Opportunity to Reduce Energy Costs Customized design cost-effectively addresses fouling issues

By Tom Tucker

Behind corn, most ethanol distilleries rank natural gas as the highest input cost. Grain dryers consume a significant portion.

Recently, natural gas prices have come down.

But when, not if, prices rebound, finding costeffective ways to improve process efficiency will have a significant impact. One area many

The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Ethanol Producer Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).

50 | Ethanol Producer Magazine | September 2012

ethanol grain distillers, and also asphalt or beverage distillers, identify as a potential one for improvement is recovering heat from the dryers and regenerative thermal oxidizers (RTO).

This heat can be used to reduce process and dryer energy depending on the specific situation.

Ace Ethanol LLC in Stanley, Wis., has

ENERGY ETS SCORPIONS™ been actively improving the energy efficiency of its process operations since its first energy assessment in 2007. In 2010, management set out to reduce its dependence on natural gas by recovering heat from the RTO stack.

“As the ethanol industry ages, grows, and becomes more competitive, the focus must shift to cost savings and operating efficiency,” said Joe Fischer, Ace Ethanol’s plant manager.

“The only way to be successful long term will be to seek out and take advantage of opportunities to make the process better and more efficient.”

As the first large-scale plant to produce ethanol in Wisconsin, Ace Ethanol is on the leading edge. Built in 2002, Ace Ethanol operates nearly 24/7, producing more than 46 MMgy and 350 tons of DDGS per day.

When the plant began examining ways to recover heat from the RTO exhaust, natural gas prices hovered around $6 MMBtu. Fischer estimated that RTO heat recovery could reduce plant gas use by about 7 to 10 percent.

In Delta-T plant designs like Ace Ethanol, as well as others (ICM, Lurgi, Poet), an RTO is used to control emissions from the DDGS dryers. These dryers run around the clock, year round, and pump lots of heat energy to the atmosphere. Heat leaving an RTO at similar plants can range from 300-500 degrees Fahrenheit.

One of the challenges with RTO heat recovery, however, is the high fouling potential of the exhaust, apparently due to volatile organic compounds and particulates that can adhere to surfaces they contact. This appears to be a bigger concern as the exhaust is cooled below 240 F and has kept many distillers from fully exploring RTO heat recovery due to the issues with the fin-tube heat exchanger technology traditionally used.

The Traditional Approach

Traditional exhaust heat recovery systems center around fin-tube technology due to their simplicity and relatively low cost. A fin-tube exchanger is a series of narrowly spaced plates fixed to tubes. The hot exhaust passes directly through the spacing between the plates, allowing the heat to be recovered.

It acts much like a car radiator.

While generally considered cost effec-

tive, aka cheaper, the fin-tube is prone to fouling when deposits stick and plug the narrow gap between the plates. If left unattended, the deposits can bake into a hard material and the narrow gap makes effective cleaning very difficult, if not impossible. One ethanol plant that installed a fin-tube exchanger for RTO exhaust heat recovery resorted to bypassing the exchanger completely when it became irreparably fouled.

Seeing the significant potential cost benefits, Ace Ethanol wanted to recover the RTO exhaust heat, but was concerned about fouling, reliability and equipment life. Ace contracted with Madison, Wis.-based Kinergetics LLC, a process engineering and energy efficiency consulting firm, to explore options.

After considering the application, Kinergetics recommended a shell and tube design for the Ace application. The shell and tube was selected as the most promising option due its robustness and ability to be cleaned if fouling does occur, much like the evaporators already on site.

A shell and tube is one of the most common types of heat exchangers for heat transfer between liquids, but is much less common for heat transfer from a high volume exhaust, such as from the RTO. Because of heat transfer constraints when dealing with gases, a shell and tube has to be well-designed and optimized at critical points to keep the cost in check, otherwise, the exchanger becomes very large and expensive.

“For shell and tube exchangers to work properly and be cost-effective, they must be designed right. There is a lot of engineering and experience that goes into making sure the right dimensions, tube counts, components, materials, etc., are used. Even the shell side design becomes important in a cost-optimized approach,” Fischer explained.

Such tricky business is best left to a specialist. After talking with several vendors, it was determined that there were no suitable commercial units available that matched performance and economic requirements, thus, Ace Ethanol turned to Kinergetics for a custom-designed system. “We wanted the best compromise between efficiency and cost,” Fischer said. “Since we run a 24/7 operation, we needed something that could be counted

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September 2012 | Ethanol Producer Magazine | 51

ENERGY

on to be running and be efficient with little need for attention. We felt that this shell and tube design, designed specifically for our application, would give us the best reliability.”

Designing a Solution

Kinergetics has been supporting the ethanol industry since 2007 and was familiar with Ace Ethanol’s concerns. A commercially built heat exchanger that properly addresses the heat recovery duty is often a good answer, but when heat transfer, downtime risks, high fouling potential, pressure drop and cost must be considered together, rarely is an offthe-shelf solution the best fit. It is important to cost-effectively engineer approaches to minimize fouling, reduce process downtime and decrease maintenance.

“My biggest concerns were efficiency, tendency for fouling, and robustness (would it maintain integrity for many years),” Fischer said. “We felt comfortable in Kinergetic’s abilities and were confident they would consider all things and custom design the best possible exchanger. The cost of the completed system was found to be very competitive with a traditional fin-tube approach.”

Kinergetics custom engineered a shell and tube exchanger for the Ace application.

If fouling does occur, the exchanger can be cleaned much like the evaporators already

used onsite and there is very little risk of downtime since plugging is a minimal concern. The unique mechanical and thermal design of Ace’s RTO exchanger optimizes thermal performance and makes the unit smaller than normally expected for a standard shell and tube design. There are plants with a capacity similar to Ace whose budget proposals (from others) based on the fin-tube technology ranged from $750,000 to well over $1 million. The Kinergetics design needed to be very competitive with traditional fin tube approaches, without the risk of failure. Companies shouldn’t be scared away from doing the right thing environmentally. It’s not cheap, but it can be done cost-effectively. Kinergetics estimates the return on investment for Ace is only two years.

The Fix is In

Designing the custom shell and tube was only part of the process. Kinergetics selected and ordered specialized components, supervised fabrication, and on-site delivery to ensure proper handling on arrival. Kinergetics also provided support to address environmental questions related to the facility air permit. But these are only a part of the solution.

Because of space constraints, this exchanger was designed to be installed right in the RTO stack. Weight and wind considerations pre-

Lessons Learned

From early energy studies to bids and installation, Ace Ethanol underwent a thorough process to achieve energy savings with its custombuilt RTO heat recovery system. Plant Manager Joe Fischer offers these suggestions:  Custom design to fit your process since no two processes are identical. A cookie-cutter design may not give the best return.  Work with a knowledgeable and experienced engineer to make sure the design is done properly. It may cost slightly more upfront, but you will likely see more benefit and fewer headaches long-term. Most plant managers are probably not experts in heat exchanger design, and have a lot of other aspects of the business that need attention, so it makes sense to outsource a project like this.  Be open-minded to allowing outsiders to take a look at your processes and make recommendations. No one person can know all and see all opportunities for improvement.

52 | Ethanol Producer Magazine | September 2012

ENERGY

Plugged Tight An actual photo from an ethanol plant shows how badly a fin-tube heat exchanger can get fouled.

Author: Tom Tucker Principal, Kinergetics LLC (608) 442-5690 ttucker@kinergetics.net

Fielding Profitability from Biofuels If you are looking to catch yields and profits from biofuels production, look to team up with GEA Westfalia Separator.

Our over 20 years of experience in ethanol production have led to technologies that can score maximum profits and savings through the entire processing chain. Our stable of separating equipment, including standard decanters, gas-tight decanters, high g-force self-cleaning disc clarifiers and separators, is capable of handling the full range of feedstocks, like stillage, algae and cellulose. Plus, we offer separators for both by-product and wastewater processing.

To learn more about the services and equipment our team can provide, contact Keith Funsch at 201-784-4322 or email Keith.Funsch@gea.com.

GEA Mechanical Equipment US, Inc.

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engineering for a better world

1612T

sented challenges, among which were building a 75-foot tower to “hang” the stack, and support the 40,000-pound flooded weight while allowing for thermal expansion and dealing with Wisconsin’s winter weather.

While Kinergetics provided the process engineering and site supervision, outside experts balanced the process. Hercules Contractors and Engineers, a construction and engineering firm in business for more than 40 years, designed the structure and foundation for the support. Daniels General Contractors handled construction of the foundation, steel structure and exchanger installation.

“Kinergetics handled the design and contracting making it pretty much a ‘turn key’ project,” said Fischer. “And, they worked around our schedules and kept lines of communication very open, which made the whole process relatively painless. Once the project was complete, we pretty much just had to turn a few valves and were instantly saving energy.”

From design to delivery took approximately six months. Preparation of the site took one month, much of which was completed while the exchanger was being built. The actual installation, with dryers off, was only one and a half days and was coordinated with normal maintenance downtime. From the moment the system was started, it was clear that performance expectations were being met, and while the fouling concerns have proven to be real over time, the unit is very easy to clean and there has been no downtime.

ANTIMICROBIALS

CONTRIBUTION

Bacterial Inhibition Without Antibiotics A method for controlling infection and maximizing ethanol yields

By Sami Faour

Since the beginning of the year, the ethanol industry has been facing an ever-changing market environment of higher input costs and increased competition. During

periods of low-cost corn and high revenue, many operations overlook plant efficiency and focus on throughput. Now that the market dynamics have changed and the growth of the ethanol industry has slowed, and in order to

have long-term success, producers have shifted their focus to increased ethanol yield and efficiency.

Increasing the ethanol concentration in a fermenter can be pursued by a number of strategies: purchasing high-quality corn that possesses high-starch and low-moisture content, trialing new enzymes with better starchto-ethanol conversion or by trying a new yeast strain that is more robust than whatâ&#x20AC;&#x2122;s currently

The claims and statements made in this article belong exclusively to the author(s) and do not necessarily reflect the views of Ethanol Producer Magazine or its advertisers. All questions pertaining to this article should be directed to the author(s).

54 | Ethanol Producer Magazine | September 2012

available in the market. But using any or all of these strategies does not necessarily maximize yield.

Operators must also address controlling the infection level and its organic acid metabolites with the proper antimicrobial, and maintaining healthier and more viable yeast during the course of fermentation with proper nutrition. BetaTec Hop Products has addressed both of these issues with two technologies which, used together, deliver bacterial inhibition, enhanced yeast health, higher ethanol yield and improved fermentation kinetics.

ANTIMICROBIALS

Infection Potential

Growth of contaminating lactic acid bacteria is a major problem in industrial alcohol fermentations. These bacteria can grow under the conditions of yeast fermentation and reduce alcohol yields by consuming glucose that could have been used by yeast for ethanol production. The end products of metabolism of lactobacilli, lactic acid and acetic acid are detrimental to yeast growth and metabolism and, therefore, occur when propagations and/ or fermentations are allowed to continue under less-than-sufficient microbial control. As bacterial numbers increase so do the acids formed. The metabolism of these organisms varies from that of Saccharomyces yeast with substantial production of lactic acid and lesser amounts of acetic acid made. In addition to operating the plant under as sanitary conditions as possible, the most common strategy to control Lactobacillus contamination is by the addition of antibiotics. Concerns are rising, however, about the overuse of antibiotics for industrial applications that may contribute to the emergence of resistant pathogenic bacteria strains harmful to animals and humans. Additionally, the presence of antibiotics in saleable coproducts (distillers grains) can negatively impact their marketability.

The preservative properties of hop acids that have been used in the brewing industry for more than a millennium constitute a legitimate naturally derived alternative. BetaTecâ&#x20AC;&#x2122;s trademarked IsoStab, an aqueous solution of isomerized alpha acids, has been successfully used in dry mill and wet mill ethanol plants since 2004. By adding the minimum inhibitory concentration of IsoStab to the yeast propagation tank and/or to the fermentation vessel, one can inhibit the growth of lactic acid bacteria during the production of ethanol and entirely avoid the need for antibiotics.

The mode of action for hop acids is based on the fact that the undissociated form of the hop acid is toxic to bacteria. Decreasing the mash pH increases the concentration of the undissociated form of hop acid, which is permeable to the cell membrane. The latter form is soluble in the phospholipid of the membrane and diffuses passively into the cell.

Because of the higher pH inside the cell, the acid then dissociates and the liberated proton

acidifies the cytoplasm, and as a result dissipates the pH gradient across the cytoplasmic membrane. This leads to the inhibition of nutrient uptake and, eventually, the bacteria starves to death.

Enhancing Yeast Nutrition

The importance of yeast nutrition has been overlooked by the fuel ethanol industry.

Its relevance to bacterial spoilage, yeast bud-

ding, fermentable ethanol ceiling and the rate of fermentation is poorly understood. Depending upon the feedstock used and yeast cell growth during propagation, the fermentation can be negatively affected by nutrient deficiency, causing yeast stress and consequently lower ethanol yield. Bacteria contamination can also deplete the availability of nutrients and, hence, undermine yeast efficiency by scavenging essential nutrients away from the yeast. In prac-

September 2012 | Ethanol Producer Magazine | 55

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Source: BetaTec

tice, just adding nitrogen to the propagators and to the fermenters is sufficient to promote successful fermentations. However, fermentation difficulties arise from a progressive reduction in yeast viability, which is caused by the combined effect of several factors: • Loss of permeability in the cytoplasmic membrane of the yeast through insufficient synthesis of sterols.

• Adsorption of toxic fatty acids.

• An increase in the concentration of ethanol.

• Temperature fluctuation.

VitaHop Silver, a newly developed fermentation activator, is a proprietary formulation of dry cells of Saccharomyces cerevisiae, amino acids, vitamins and other ingredients designed to provide the yeast with the proper balance of nutrients for optimal growth and reproduction. In addition, VitaHop Silver increases yeast viability, particularly late in fermentation, resulting in ethanol yield enhancement.

Synergies in Combination

Laboratory research discovered that when both products, IsoStab and VitaHop Silver, are added simultaneously to a fermentation system, superior results in bacterial inhibition, ethanol yields, kinetics and yeast biomass and viability are achieved compared

56 | Ethanol Producer Magazine | September 2012

to when they are used individually or versus antibiotics. This suggested a complementary effect between the hop acid product and the proprietary yeast nutrient.

Those interesting findings prompted investigation of this combined performance at the commercial level. The key performance metrics examined in the case study were lactic and acetic acids, yeast cell count, yeast viability, ethanol yield and the kinetics ( rate of ethanol production).

A Midwestern ethanol plant was used to trial the IsoStab and VitaHop Silver combination. The plant was experiencing slightly elevated lactic acids and there was interest in comparing their current antibiotic program with other options in order to minimize infection and maximize ethanol production. The 50 MMgy plant utilized the BetaTec program and added both IsoStab and VitaHop Silver to the propagator. The plant continued to run at a steady state during the one-month trial.

Fermentation analysis of the plant data under this program showed positive results.

HPLC data showed a reduction of 44 percent in lactic acid concentration and a relative increase of 1.7 percent in ethanol yield, despite the drop in solids during the trial. Correcting it for solid loading, the relative increase in ethanol yield jumped to 2.7 percent (statistically significant as the data was processed at the 95 percent confidence level to ensure that

ANTIMICROBIALS

The Isostab & VitaHop Silver treated batches increased the Ethanol Yield by >2.0% vs. Antibiotics in spite of Solids Drop

The Specialist in Biofuels Plant Appraisals

*Ethanol yields are statistically different

*Ethanol yields are statistically different Source: BetaTec 18

the differences in the data are real). The rate of ethanol production (kinetics) followed a similar trend and the combination was able to increase the production rate by 5 percent at the height of fermentation.

A review of yeast data indicates that the IsoStab and VitaHop Silver combination had an 18 percent higher yeast cell count versus antibiotics. More substantial is the fact that viability in the propagator was increased by 5.5 percent, leading to healthier yeast in the fermenter. Although one might predict that excess yeast biomass will lead to reduced ethanol yield, accelerated trouble-free fermentations with higher ethanol concentration resulted. The nutrients and hop acids combined treatment lead to stronger yeast that diverted glucose destined for cell mass to ethanol production.

The magnitude of the ethanol-yield increase with the IsoStab and VitaHop Silver program is critical to the plant’s bottom line.

In this particular case, the average daily ethanol production was about 150,000 gallons of 200 proof. An increase of 2.7 percent in yield corresponds to 4,050 gallons of extra daily ethanol production. Assuming a price of $2 per gallon of ethanol, this will add a profit of $8,100 per day or $243,000 per month to the plant’s bottom line. The plant managers were so satisfied with the results that they continued on with the BetaTec program.

More than 20 plant trials have been conducted with the IsoStab and VitaHop combination technology with the following results: • An ethanol yield increase, ranging from1.50-3.2 percent (an increase that was statistically significant compared to the control).

• More consistent fermentations.

• Yeast cell counts increase, ranging from 15-30 percent.

• Yeast viability improvement, ranging from 2-5 percent.

• Faster fermentation kinetics, ranging from 2-5 percent.

Those improvements were observed against any type of antibiotic that these plants employed and affirm the complementary nature of these technologies. The combined technologies will boost the operational flexibility of a plant by allowing the producer to maximize the quantity of ethanol produced.

In addition, it constitutes the perfect alternative to antibiotics and would enable the industry to sell certified antibiotic-free DDGS to local and international markets where antibiotics are either banned or being discouraged.

Author: Sami Faour Technical Manager, North America, BetaTec Hop Products Sami.Faour@johnihaas.com (816) 509-0200

• • • •

Valuation for financing Establishing an asking price Expert witness testimony Partial interest valuation Few certified appraisers in the United States specialize in ethanol plant and related biofuels properties. The firm of Natwick Associates offers more than 50 years of worldwide experience. Your appraisal will be completed by a certified general appraiser and conform to all state and federal appraisal standards.

Call us for a free, no-obligation consulation today.

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September 2012 | Ethanol Producer Magazine | 57

EPM MARKETPLACE Ag Products & Services

Fans

Equipment

Hydro-Klean, Inc. 515-283-0500

Mole Master Services Corporation 740-374-6726

www.molemaster.com

Associations/Organizations Growth Energy 202-545-4000

www.hydro-klean.com

Premium Plant Services, Inc. 888-549-1869 www.premiumplantservices.com

Heat Exchanger

www.growthenergy.org

Chemicals Additives U.S. Water Services 866-663-7633 www.uswaterservices.com

Denaturant Viachem, LLC 631-752-8700

www.viacheminc.com

Enzymes CTE Global, Inc. 847-564-5770

www.cte-global.com

Nagase American Corporation 212-703-1364 www.nagaeamerica.com

Yeast Fermentis-Division of SI Lesaffre 800-558-7279

www.fermentis.com Lallemand Ethanol Technology 800-583-6484 www.EthanolTech.com Taurus Energy AB 952-926-0100

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Freez-It-Cleen 612-597-9337

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Seneca Companies 800-369-5500

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Scanjet, Inc. 281-480-4041

Hydro-Klean, Inc. 515-283-0500

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Premium Plant Services, Inc. 888-549-1869 www.premiumplantservices.com

Premium Plant Services, Inc. 888-549-1869 www.premiumplantservices.com MPS Group 515-953-5656

Seneca Companies 800-369-5500

Construction

Seneca Companies 800-369-5500

Fabrication

www.senecaco.com

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Agra Industries Inc. 715-536-9584

Evaporators Hydro-Klean, Inc. 515-283-0500

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Tank Cleaning Services

Dryer Systems

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Cloud/Sellers Cleaning Systems 800-234-5650

www.sellersclean.com Gamajet Cleaning Systems Inc. 877-GAMAJET www.gamajet.com

Hydro-Blasting

Cleaning Hydro-Klean, Inc. 515-283-0500

Tank Cleaning Equipment

www.hydro-klean.com

Premium Plant Services, Inc. 888-549-1869 www.premiumplantservices.com

58 | Ethanol Producer Magazine | September 2012

www.agraind.com

Grain Storage Hoffmann, Inc. 563-263-4733

www.hoffmanninc.com

EPM MARKETPLACE Plant Construction Agra Industries Inc. 715-536-9584

Fagen, Inc. 320-564-3324

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www.sekab.com

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Agitation Equipment

Stack Hoffmann, Inc. 563-263-4733

EKATO Corporation 201-825-4684, x217

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Air Pollution/Odor Control

Tanks Agra Industries Inc. 715-536-9584

Anguil Environmental Systems, Inc. 414-365-6400

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Bionomic Industries 201-529-1094 www.bionomicind.com

Consulting Auctions

Anaerobic Digesters

Maas Companies 507-285-1444 www.masscompanies.com

Himark bioGAS 780-770-5110

Business Plans BBI Consulting Services 866-746-8385 www.bbiinternational.com

Environmental Air Resource Specialists, Inc. 970-484-7941 www.air-resource.com ERI Solutions, Inc. 316-927-4294

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RTP Environmental Associates 516-333-4526

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Feasibility Studies BBI Consulting Services 866-746-8385 www.bbiinternational.com

SGS Group 41-0-22-739-91-11

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Safety Rail Safe Training 712-212-4145

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Employment Recruiting SearchPath of Chicago 815-261-4403 www.searchpathofchicago.com Strategic Resources 425-688-1151 www.strategicresources.com

Engineering

Your Solution. Advertise Today.

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Burns & McDonnell 816-333-9400

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ICM, Inc. 877-456-8588

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Mitsubishi Electric Automation, Inc. 763-381-9384 www.meau.com

Cooling Towers Tower Performance, Inc. 800-314-1695 www.coolingtowercomponents.com

ICM, Inc. 877-456-8588

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www.cellencor.com

Dryers-Other

Design/Build

ICM, Inc. 877-456-8588

Vecoplan, LLC 336-861-6070

Corn Oil Recovery

Biomass Energy

ADF Engineering 937-847-2700

Cellulosic Pretreatment

Kahler Automation Corp.

507-235-6648 www.kahlerautomation.com

Agra Industries Inc. 715-536-9584

Reach your customers

www.himarkbiogas.com

Control Systems www.railsafetraining.com

Wolf Material Handling Systems 763-576-9040 www.wolfmhs.com

Plant Optimization ICM, Inc. 877-456-8588

Quality Assurance

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Cellencor, Inc. 515-259-1122

Dryers-Rotary Drum ICM, Inc. 877-456-8588

www.icminc.com

Dryers-Rotary Steam Tube ICM, Inc. 877-456-8588

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Emissions Testing & Reduction ARI Environmental, Inc. 847-487-1580

www.arienv.com

www.preprocessinc.com September 2012 | Ethanol Producer Magazine | 59

EPM MARKETPLACE Fermentation Monitoring

Productivity Enhancements

Valves

ETS Laboratories 707-963-4806

ICM, Inc. 877-456-8588

Best Supply Company 316-262-8336 www.bestsupplycompany.net

www.etslabs.com

Cashco, Inc. 785-472-4461

Fermentors

Safety

Bioengineering, Inc. 781-672-2620 www.bioengineering-inc.com

ERI Solutions, Inc. 316-927-4294

Fractionation-Corn

Silo Cleaning

ICM, Inc. 877-456-8588

www.icminc.com

erisolutions.com

www.pickheaters.com

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Interra Global 847-292-8600

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Parts & Services

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Storage-DDGS Hoffmann, Inc. 563-263-4733

Molecular Sieves

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Structural Fabrication Agra Industries, Inc. 715-536-9584

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Tanks

Grant Writing Sustainable Energy Strategies, Inc. 703-543-6838

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Legal Services Attorneys

Vecoplan, LLC 336-861-6070

Millright

ICM, Inc. 877-456-8588

Finance

BBI Consulting Services 866-746-8385 www.bbiinternational.com

Membrane Dehydration Systems

Agra Industries, Inc. 715-536-9584

www.himarkbiogas.com

Louis Dreyfus Commodities 402-844-2680 www.LDCommodities.com

Heat Exchangers

ICM, Inc. 877-456-8588

Yield Enhancement

Existing Producers

www.agraind.com

PFT-Alexander, Inc. 1-800-696-1331

www.icminc.com

Ethanol Production

Grain Handling & Storage

Pick Heaters, Inc. 800-233-9030

Wastewater Treatment Services

Himark bioGAS 780-700-5110

LAI Ethanol Bio Tech Div, Langhauser Assoc.

217-412-1150 www.LanghauserAssociates.com

Agra Industries Inc. 715-536-9584

www.cashco.com

ICM, Inc. 877-456-8588

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Agra Industries, Inc. 715-536-9584

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Truck Receiving/Dumpers Airoflex Equipment 563-264-8066 www.airoflexequipment.com 60 | Ethanol Producer Magazine | September 2012

BrownWinick Law Firm 515-242-2414 johnson@brownwinick.com Greenwich Blackhawk Prof. Corp.

310-393-2200 www.greenwichblackhawk.com

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