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JULY 2017

ENHANCING EFFICIENCY New Dehydration Process Eliminates Mole Sieve Regen Page 48

Opening Markets Through Sustainable Certification Page 22

Environmentalism Upstream Page 28


Solar Solution for Carbon Intensity Page 32

Plant Optimization Phase 2

Page 40

Innovation Applied Proudly Serving Clients in the Ethanol Industry Rayeman Compression Dryer (RCD) • Ground-Breaking Patented Technology for DDGS • Lower Capex and Opex • Explosion/Fire Proof • Smaller Footprint/Lower VOCs • Preserves Highest Fat and/or Protein levels • Commands a Higher Price for your DDGS

Rayeman Bulk Densification Line • Bulk Densifies Materials up to 70% • Nearly Any Materials can be Processed • Opportunity to Diversify Revenue Streams • Improves and Expands Current Market Segments • Less than 2% Fines during Shipping and Handling • No Fillers or Binders • Highest Nutritional Value in Feed Supplements • May Add Vitamins and Minerals or Medication, if desired • Moisture Resistant

Rayeman Grain Cooling System • Preserves Highest Nutritional Value in the Grain • Eliminates Burning of Material • Creates Flowable Grain that Won’t Bridge • Extremely Controllable Temperatures • Can Directly Connect to Dryer • Can Be Implemented Directly off the Distillation Process • De-Clumps Dry Grain • Produces a Lighter Colored Grain • Levels of Moisture from 95% to 5% for Cooling

Rayeman Automated Tub Press System • Consumption Rate Controlled Solely through Density, Rather Than Limiters • 100% DDG or DDGS • No Fillers or Binders • 1-3 Pounds per head/per day Guaranteed • Possible to Dial in Other Feeding Rates • May Add Vitamins and Minerals or Medication, if desired • Specially Designed Tub ensures Billet Will Not Fall Out If the Tub is Kicked Over • Water/Rain resistant | 970-344-4776






Greener, On Our Own Accord By Tom Bryan







Summertime Relief at the Pump By Emily Skor


Tested. Proven. Driven. By Brian Jennings




Higher Ethanol Blends Key to Driving Farm Economy By Doug Sombke




OSHA Rescinds Union Walkaround Memo By Ryan Funk


Compliance with requirements opens opportunities overseas and improves efficiency. By Luke Geiver


Meeting Needs, Maximizing Benefits


As corn farming becomes more environmentally friendly, so does ethanol production. By Ann Bailey


Charged Up


Solar arrays lower a plant's carbon intensity and reduce electrical price volatility. By Patrick C. Miller


Winning the Battle Against Climate Change By Jim Grey



Sustainable Certification for the Ethanol Process

The Lowest-Cost, Cleanest Octane Boost for Boats By Bob Dinneen







Process Checkups


The ethanol industry enters phase 2 of debottlenecking and process polishing. By Susanne Retka Schill


Outfoxing Dehydration


London-based Whitefox Technologies has a success story in Iowa with its new process. By Tim Portz



Understanding API Tank Requirements ON THE COVER

Gillian Harrison is CEO of Whitefox Technologies Ltd., based in London. PHOTO: TIM PORTZ, BBI INTERNATIONAL

Ethanol Producer Magazine: (USPS No. 023-974) July 2017, Vol. 23, Issue 7. 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.

4 | Ethanol Producer Magazine | JULY 2017

Regular checkups are crucial, but can be complicated. By Cassandra Thomason


California LCFS Guides Advanced Biofuels Industry

With new certified pathways and recovered carbon credit prices, the program gets back on track. By Heather Zhang


How Not to Kill the Molecular Sieve

Proper care increases efficiency and lifespan of the system. By Mark J. Binns



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EDITORIAL President & Editor in Chief Tom Bryan Vice President of Content & Executive Editor Tim Portz Managing Editor Susanne Retka Schill News Editor Erin Voegele Copy Editor Jan Tellmann

ART Art Director Jaci Satterlund Graphic Designer Raquel Boushee

PUBLISHING Chairman Mike Bryan CEO Joe Bryan

SALES Vice President of Operations Matthew Spoor Sales & Marketing Director John Nelson Business Development Director Howard Brockhouse Senior Account Manager/Bioenergy Team Leader Chip Shereck Circulation Manager Jessica Tiller Marketing & Advertising Manager Marla DeFoe

EDITORIAL BOARD Ringneck Energy Walter Wendland Little Sioux Corn Processors Steve Roe Commonwealth Agri-Energy Mick Henderson Pinal Energy Keith Kor Aemetis Advanced Fuels Eric McAfee Western Plains Energy Derek Peine Corn Plus Mike Jerke

ADVERTISER INDEX 2017 International Fuel Ethanol Workshop & Expo 2018 International Fuel Ethanol Workshop & Expo AB Biotek AgCountry Farm Credit Services Agra Industries BetaTec Hop Products Biofuels Financial Conference Buckman CHS Renewable Fuels Marketing Cloud/Sellers Cleaning Systems D3MAX LLC DuPont Industrial Biosciences Edeniq, Inc. EISENMANN Corporation Fagen Inc. Fluid Quip Process Technologies, LLC Growth Energy Hengye Inc. Hydro-Klean LLC ICM, Inc. InfoSight Corporation Interra Global Corporation J.C. Ramsdell Enviro Services, Inc. Lallemand Biofuels & Distilled Spirits Leaf - Lesaffre Advanced Fermentations McC Inc. Mist Chemical & Supply Company Mole Master Services Corporation Nalco Water Novozymes Phibro Ethanol Performance Group POET LLC Premium Plant Services, Inc. R.S. Stover Rayeman Elements, Inc. RPMG, Inc. Solenis LLC Southeastern Illinois College StoneAge Syngenta: Enogen Terydon Inc. Thermal Refractory Trident Automation U.S. Water Services United Sorghum Checkoff Program Valicor Separation Technologies Victory Energy Operations, LLC Westmor Industries, LLC WINBCO

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6 | Ethanol Producer Magazine | JULY 2017


Greener, On Our Own Accord Time will tell how President Trump’s exit from the Paris Climate Accord will affect the U.S. ethanol industry, which is banking on foreign demand for its low-carbon, high-octane fuel to grow. At press time, rumors

Tom Bryan

President & Editor in Chief

circulated that the European Union might impose sanctions on American biomass— shipped to Europe for power—to penalize the U.S. for abandoning the alliance. No such threats have been made about ethanol, but leaving Paris via an anti-globalization dustup probably won’t help us sell more ethanol abroad. Then again, maybe it won’t hurt, because Europe and China already treat our ethanol unfairly. They restrict imports with tariffs and questionable sustainability rules. Other countries are following suit with similar hoops, but as Luke Geiver reports in “Sustainable Certification for the Ethanol Process,” on page 22, it won’t stop us. Nearly two dozen U.S. ethanol plants have pursued certifications that allow them to sell ethanol into environmentally persnickety markets around the world. Expect more to do the same. Sustainability certification often starts with feedstock verification, and there’s no question that not all crops are grown the same. As Ann Bailey reports in “Meeting Needs, Maximizing Benefits,” on page 28, many corn farmers are embracing a variety of sustainable agriculture production practices, including strip farming, planting cover crops and improving soil health, to reduce their environmental footprints. The exciting part is that farmers are doing this voluntarily, and mostly because it makes economic sense. Coincidentally, the economics of going green will also determine the viability of an idea to equip ethanol plants with solar panels, a concept explained by Patrick Miller in “Charged Up,” on page 32. The continuous improvement of ethanol plant efficiencies has been one of the great unsung stories in transportation fuels history, and its latest chapter is now unfolding. As Susanne Retka Schill reports in “Process Checkups,” on page 40, many U.S. ethanol plants are in the early stages of second-generation debottlenecking and optimization, building on what they accomplished over the past decade. Their earlier work focused on low-hanging fruit—upgrades, tweaks and add-ons—that pushed plants beyond nameplate capacity. Now, producers are engaging with process engineers and vendors on more capital-intensive upgrades, not just for added gallons, but greater efficiency and diversification. Finally, in “Outfoxing Dehydration,” on page 48, we learn how an ethanol plant in central Iowa is eliminating its molecular sieve regeneration cycles amidst a plant overhaul and major expansion. The story, by Tim Portz, explains how Pine Lake Corn Processors has worked with Whitefox Technologies to incorporate this promising new technology, which should yield more ethanol, more efficiently.


TWITTER.COM/ETHANOLMAGAZINE JULY 2017 | Ethanol Producer Magazine | 7


The Lowest-Cost, Cleanest Octane Boost for Boats By Bob Dinneen

It’s summer, when temperatures can soar into triple digits. One of the best ways to cool down is to head out on the water for fishing, skiing or other recreational sports. The U.S. has 12 million recreational boaters and I want to make sure they know about and can take advantage of ethanol’s benefits when fueling up. All watercraft is compatible with ethanol blends up to 10 percent and every marine engine manufacturer has approved the use of E10 for decades. To highlight ethanol’s benefits and use in marine applications, the Renewable Fuels Association is a cotitle sponsor of the Crappie Masters Tournament Trail this year. The tournament runs through early fall, but it already has helped educate boaters and consumers on ethanol’s benefits. Crappie Masters President Mike Vallentine says his organization has “worked hard over the past few years, dispelling the myths and mistruths regarding E10 fuel in outboard engines. … We aim to educate boaters and all outdoor lovers that ethanol is safe for your boat, safe for the water and fisheries, safe for the environment, safe for the future and the best choice all around, along with supporting America's farmers.” He also notes that every poll taken has shown tournament anglers are using E10 in their boats. Meanwhile, earlier this summer, RFA launched an ad campaign to further educate consumers on ethanol use in marine engines, with ads in Marina Dock Age, The Hill and Morning Consult. The ads highlight the numerous benefits to using ethanol, including: • With its 113 octane rating, ethanol is the highest performance fuel on the market.

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• Ethanol is the cleanest fuel on the market. It is the best tool available to reduce emissions that can be harmful to marine life. Ethanol also reduces greenhouse gas emissions by 43 percent compared to gasoline. • Ethanol is the lowest-cost fuel option available to boaters. A recent Morning Consult survey also found that three out of four recreational boat owners are comfortable using ethanol in their boats. But it is important to remember that while E10 is approved for use in all marine engines, higher ethanol blends, such as E15, are not. The U.S. EPA has approved the use of E15 in all 2001 and later model year vehicles, but only for on-road vehicles. Through more than four years of E15 sales, there has not been a single case of E15 misfueling in a marine engine. So while out enjoying a spin on local waterways, fuel up with 10 percent ethanol, the cleanest, lowest-cost and highest source of octane on the planet. Author: Bob Dinneen President and CEO Renewable Fuels Association 202-289-3835

EVENTS CALENDAR Christianson PLLP's Biofuels Financial Conference September 27-28, 2017 Radisson Blu Minneapolis Downtown Minneapolis, Minnesota Produced by Christianson PLLP and organized by BBI International, this year’s Biofuels Financial Conference is focused on the best ways to explore new options in today’s changing ethanol and biodiesel industries. By understanding risks associated with various technology and marketing initiatives, and by exploring various options for making the best use of capital and resources, attendees will learn how to create a well-managed plan for growth and change—a plan that maximizes profitability while ensuring future stability and meeting the expectations of all stakeholders. 866-746-8385 |

2018 International Fuel Ethanol Workshop & Expo June 11-13, 2018 CenturyLink Center Omaha Omaha, Nebraska

Relationship lending for all your financial needs

Focused solely on agriculture, the Agribusiness and Capital Markets department of AgCountry Farm Credit Services has the experience and expertise to be the complete solution for all your financing needs.

From its inception, the mission of this event has remained constant: The FEW delivers timely presentations with a strong focus on commercial-scale ethanol production— from quality control and yield maximization to regulatory compliance and fiscal management. The FEW is the ethanol industry’s premier forum for unveiling new technologies and research findings. The program covers cellulosic ethanol while remaining committed to optimizing existing grain ethanol operations. 866-746-8385 |

2018 National Advanced Biofuels Conference & Expo June 11-13, 2018 CenturyLink Center Omaha Omaha, Nebraska Colocated with the International Fuel Ethanol Workshop the National Advanced Biofuels Conference & Expo is tailored for industry professionals engaged in producing, developing and deploying advanced biofuels, including cellulosic ethanol, biobased platform chemicals, polymers and other renewable molecules that have the potential to meet or exceed the performance of petroleum-derived products. 866-746-8385 |

Please check our website for upcoming webinars

877-811-4073 •

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Proudly serving customers across all facets of agriculture JULY 2017 | Ethanol Producer Magazine | 9


Summertime Relief at the Pump By Emily Skor

Leading into the peak driving season, AAA predicted that the average cost for a gallon of fuel would climb by 40 cents this summer. For some, that’s

enough to put the brakes on vacation plans. For others, it’s enough to turn the daily commute into a major drain on the household budget. Interestingly, supply and demand are far from the only factors that drive this seasonal climb in gas prices. Federal fuel regulations play a major role. That’s because warm summer weather makes it tougher to hold down automotive emissions, so the U.S. EPA requires cleaner fuel blends from June 1 to Sept. 15. Cleaner fuels are often more expensive, but they don’t have to be. In 29 states, many retailers offer E15, a 15 percent ethanol blend that is approved for any passenger vehicle built since 2001. It tends to cost around 5 to 10 cents less per gallon. According to the Environmental and Energy Study Institute, E15 can also help “reduce harmful volatile organic compound (VOC) emissions, displace cancer causing emissions, and reduce smog-forming potential.” And ethanol reduces carbon emissions by 43 percent compared to gasoline. Given these facts, one would think demand for higher ethanol blends would skyrocket during the summer, both to protect our air and our wallets. But an arcane EPA standard is standing in the way. It’s called Reid vapor pressure (RVP) — a measure of how quickly fuel evaporates. The law hasn’t been updated since 1990, and it is hopelessly out of date. A key waiver that applies to fuels containing zero to 10 percent ethanol was never extended to E15, so many convenience stores are forced to relabel all of their E15 as flex-fuel only options, which is costly and a logistical headache. Others avoid selling E15 entirely, simply to avoid the seasonal confusion and cost of a switch that requires relabeling of all pumps carrying E15. For biofuel producers, this seemingly minor regulatory hurdle has become the single greatest barrier to market-driven growth. At the same time, our environment suffers needlessly, retailers carry an expensive

burden and consumers lose access to one of the most affordable, highperformance fuels on the market—exactly when gas prices are at their peak. That’s why Growth Energy has been leading the charge for more than three years to secure passage of legislation that would level the playing field for homegrown biofuels. The bipartisan Consumer and Fuel Retailer Choice Act (S.517) was introduced by Sens. Deb Fischer, R-Neb., Joe Donnelly, D-Ind., Chuck Grassley, R-Iowa, and 14 other bipartisan senators in March. This legislation adds two words to the 1990 law, extending the RVP waiver to fuel with 10 percent or more ethanol, allowing retailers across the country to offer more biofuel choices to customers year-round. The proposal has bipartisan support in both the House and Senate, and even EPA Administrator Scott Pruitt has expressed his hope for a fix. We’re also working with a broad coalition of allies to remind lawmakers that this legislation does more than lift restrictions on summertime ethanol sales. It creates a vital market for continued investment in the next generation of cellulosic biofuels produced from agricultural waste and other natural materials. And it guarantees our retail partners can continue to invest in the rapid expansion of E15 pumps across the country, giving motorists the opportunity to save millions of dollars each year. Thanks to our efforts with retail partners, the number of filling stations offering E15 increased by a staggering 500 percent in 2016. And, we’re just getting started. For example, our allies at Kwik Trip are working to add E15 at more than 500 locations in Iowa, Minnesota and Wisconsin alone. These numbers are just a sample of what we can accomplish once filling stations are free to offer E15 year-round without arbitrary restrictions. To help get this vital fix onto the president’s desk, I encourage everyone who cares about clean, homegrown energy to join us in urging lawmakers to support this historic opportunity to make summer a little brighter—and a lot more affordable—for everyone. Author: Emily Skor CEO, Growth Energy 202-545-4000

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Tested. Proven. Driven. By Brian Jennings

There’s still time to register for the American Coalition for Ethanol’s 30th anniversary conference Aug. 15 to 17 in Omaha, Nebraska. The agenda is focused

on what is being done to grow demand for ethanol here at home— through E15 and flex fuels—and around the world, based on ethanol’s octane and carbon-reduction value. Our conference theme is Tested. Proven. Driven. It describes not just our molecule, but also the people of the ethanol industry. Time and time again, our industry (and our product) rises above the many tests and hurdles in its path. We’re committed to the success of farmers, rural communities and to making ethanol the consumer fuel of choice. I want to draw your attention to a few of our general session topics of significant interest. Back by popular demand, Ron Lamberty will moderate a discussion with fuel marketers who have made the switch to E15 and flex fuels. This year, the discussion will feature Bob O’Connor, owner of JETZ Convenience Stores, and Charlie Bosselman, owner of Bosselman Enterprises. JETZ is a large retailer that has begun selling E15 in Milwaukee, and Bosselman dominates the Nebraska scene with 44 Pump & Pantry convenience stores, as well as 43 auto maintenance shops across the nation. O’Connor and Bosselman will share why their companies decided to offer customers higher ethanol blends and how it has affected their bottom lines. In a panel titled “Shifting to High-Octane Fuel,” we’ll showcase how ACE and others in the industry are helping automakers accelerate the transition of motor fuel to high-octane ethanol blends. Scott Negley from Wayne Fueling Systems will explain why Wayne differentiated itself as the first equipment manufacturer to exclusively offer dispensers UL-listed for E25 to gasoline retailers. Brian West from the U.S. DOE will discuss testing underway at Oak Ridge National Laboratory to demonstrate the benefits of high-octane fuel to automakers. Finally, Adam Gustafson, partner of Boyden Gray & Associates, will give an update on the regulatory pathways to get U.S. EPA approval of highoctane fuel.

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Given how vital export markets have become to the industry, we will have a presentation called “Global Tailwinds and Headwinds” featuring Jim Galvin, CEO and director of Lakeview Energy, who will discuss the factors driving (and restricting) global demand for ethanol and coproducts, and the implications of President Donald Trump’s administration’s trade policy reform on the U.S. ethanol industry. Galvin is the appointed leader of the U.S. Grains Council advisory team for ethanol. Talk of tax reform is heating up in Washington, D.C., so Donna Funk, principal with KCoe Isom, will explain how looming changes to the tax code could affect the profitability and competitiveness of ethanol producers. We also expect to hear from members of Congress, Trump administration officials, and Nebraska Gov. Pete Ricketts on public policies at the federal and state levels to increase demand for biofuels. Our breakout sessions will take a more in-depth look at certain subjects, and we are featuring two retail-focused sessions on supplying ethanol direct-to-retail and how to execute a successful retail promotion for E15 and E30. ACE also has created a breakout track specifically for ethanol plant boards of directors: “Roles and Responsibilities, Succession Planning and Retention, and Risk Management.” Finally, we will have breakout speakers showcase technologies that enable ethanol plants to truly diversify into new products and coproducts, as well as a discussion on trends in production efficiencies. To register for the ACE conference, or for more information about the speakers and topics, please visit conference. I strongly encourage ACE’s ethanol producers and voting members to join us in Omaha on Aug. 15 for our annual business meeting and review of strategic priorities for the year. We will kick things off with our annual meeting, followed by lunch and a member-level review of our strategic priorities on government relations and market development. I hope to see you in Omaha. Author: Brian Jennings Executive Vice President American Coalition for Ethanol 605-334-3381

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Winning the Battle Against Climate Change By Jim Grey

Ethanol producers can take heart: Governments in Canada appear poised to take the steps necessary to provoke further reductions in greenhouse gas (GHG) emissions, and Canada’s ethanol industry is likely to have a feature role in the policy response.

Canada’s transportation sector is the country’s second-largest GHG emitter, after manufacturing. But, the mandated use of ethanol and biodiesel already has proven to be a big part of the solution, resulting in the reduction of 4.2 megatons of GHG emissions each year. That’s the equivalent of 1 million cars taken off the road every year. The existing national volumetric requirement (5 percent ethanol) has yielded great results without placing any burden on consumers— no additional costs have been incurred and no changes in consumer behavior have been required. In the government’s broader battle to bring down GHG emissions, the renewable fuel mandates likely have proven to be the easiest and most effective tool. It is quite likely that recognition of these factors was a key consideration in Canada’s decision to exempt the biofuel portion of blended fuels from its recently announced carbon levy. In all our interactions with legislators and policymakers, Renewable Industries Canada recommends Canada raise the required volumes to 10 percent ethanol and 5 percent biomass-based diesel. If adopted, these changes would deliver additional GHG emission reductions of approximately 4.5 megatons per year. In recent meetings with parliamentarians and senior officials in Ottawa and at the provincial level, we also have stressed that renewable fuels offer not only the ability to reduce GHG emissions substantially, but also an opportunity to create new jobs and foster economic growth. Canada’s renewable fuels sector already has a significant place in the economy, generating CA $3.5 billion ($2.6 billion) worth of activity. To support the 2016 production of 1.7 billion liters (449 million gallons) of fuels at a value of CA $1.1 billion, 4.2 million metric tons (4.6 million tons), or CA $800 million worth, of feedstock was purchased, providing a significant and predictable revenue stream to thousands of Canadian farmers. Additionally, as a byproduct of ethanol production, a further $260 million of distillers grains were sold. As an industry, we are more than just talk. Canadian ethanol production is currently experiencing a growth phase. Many companies

14 | Ethanol Producer Magazine | JULY 2017

are already in the process of expanding production. It is an exciting time to be in the business. But increasing production capacity requires significant financing. IGPC Ethanol’s expansion that will double its capacity has required a $120 million investment. RICanada has conveyed to decision makers that any uncertainty around the future demand for biofuels will hinder investment and curtail production growth. Environment and Climate Change Canada is in the process of weighing options for the implementation of a new Clean Fuels Standard that would stipulate specific GHG emission reductions to be attained in the liquid fuels sector. RICanada has welcomed this initiative, but has recommended the retention of required volumes as a complementary measure. It is our view that any new policy must not leave behind the policy lever that has played such a critical role in fostering growth in renewable fuels and reductions in GHG emissions. In other words, if governments want to maximize GHG reductions, volumetric requirements must be retained. Valuable lessons can be learned from jurisdictions that have implemented policies similar to the proposed CFS. British Columbia, California and Oregon all introduced CFS-styled programs in conjunction with volumetric renewable fuel contents. As a result, each has achieved significant GHG reductions. On the other hand, when Germany followed a different approach—opting to abandon the volumetric program in favor of a carbon-intensity program—emissions rose. Germany’s approach resulted in a drop in the volume of renewable fuels used in 2015, and a corresponding—and predictable—increase in transport sector GHG emissions, proving that implementing a CFS without complementary volume requirements presents a very real risk of backsliding. The federal government, Ontario and Quebec are all developing policy related to the use of renewable fuels. As they do, they must be reminded of the risks of losing the economic and environmental gains that have been achieved under the existing ethanol and biodiesel mandates. Author: Jim Grey Chair, Renewable Industries Canada CEO, IGPC Ethanol Inc. 519-765-2575













Higher Ethanol Blends Key to Driving Farm Economy By Doug Sombke

On a beautiful Southern California day in late March, the National Farmers Union gathered for its 115th Anniversary Convention in San Diego and reaffirmed its support for not just ethanol, but a new era of ethanol use critical to rural America and the farm economy. This position was captured in a special order of business, or what some might call a resolution, in which we united in our call for an open market that will allow us to continue to supply the natural resources that produce clean-burning, American-made renewable ethanol. NFU was among the first organizations to support the Renewable Fuel Standard, which many saw as a reach that would draw too much fire from oil companies and policymakers. Even when many in our own industry urged caution and advised against rocking the boat, we knew that when opportunity knocked, we needed to answer. A decade later, the RFS is an unqualified success and has been critical in maintaining corn prices and the rural economy. But, as a demand driver, the RFS is done—it caps corn ethanol at 15 billion gallons per year and we have reached and exceeded that level. Future growth must meet true demand, and that demand is blocked by unnecessary, arbitrary and baseless regulations. But the good news is we have identified both the pathway to true demand and the regulatory roadblocks that need to be removed. And, we need to do it now. As was the case in 2002, when we first supported the concept of an RFS, we need to rock the boat and look beyond the limits imposed on us. All our members are painfully aware that we are in the midst of a prolonged period of commodity prices below the cost of production. The irony of the RFS is that it created such demand that our farmers responded with fantastic increases in yields and efficiencies, creating surpluses in corn that allow us to exceed all demands for food, feed and fuel. And what's the most underutilized of those markets? Fuel. Ten percent ethanol blends has a nice ring to it, until you put it in perspective: We still are captive to 90 percent gasoline. Sure, E15 is a step in the right direction, but we have the feedstock capacity in

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the form of corn to double that. Why don’t we? Well, that’s where our resolution from San Diego should serve as a rallying point for our members and, hopefully, all of American agriculture, summed up in this key passage: The more higher-blend ethanol fuel products Americans purchase, the more farmers, rural communities, our environment, and our state and national economies benefit. Now is the time for our nation to find and pursue bold and innovative strategies to dramatically expand the use of home-grown fuels from the farm. The evidence is mounting that a blend of 30 percent ethanol might be the true sweet spot to take advantage of octane, while reducing harmful emissions and meeting future efficiency requirements. Working with partners such as the Urban Air Initiative and our many state chapters, we are supporting E30 demonstrations that, to date, indicate conventional automobiles can use this high-octane fuel with great results. We are working with governors across the Midwest to use E30 in state vehicles to continue to compile the real-world, in-use data we need to finally break through the regulatory barriers. And to that end, NFU has expanded the Urban Air Initiative’s legal comments with the U.S. EPA, challenging the agency’s limit of ethanol blends above 10 to 15 percent to flex-fuel vehicles only. We argue that the EPA has misinterpreted a key provision of the Clean Air Act and should immediately reverse statements that indicate it is illegal to use higher blends in nonflex-fuel vehicles. Despite the current glut of oil and low gasoline prices, the global quest for efficiency and lower carbon emissions will require clean octane, which ethanol can supply at a competitive cost, providing energy and economic security in the process. NFU will continue to work on opening the fuel market to meet those objectives and we urge all of you to join us as we rock the boat. Author: Doug Sombke President, South Dakota Farmers Union


People, Partnerships & Projects


Branstad confirmed as ambassador to China, Reynolds to become Iowa governor On May 22, the U.S. Senate voted 82 to 13 to confirm Iowa Gov. Terry Branstad as the next U.S. ambassador to China. Branstad resigned as governor on May 24, replaced by Lt. Gov. Kim Reynolds. “Never in my wildest dreams did I think that a boy from a small farm in Leland would one day have the opportunity to represent the United States and Iowa on the world stage, working closely with one of the world’s most influential countries and one of America’s largest trading partners,” Branstad said.

Poet CEO Jeff Broin receives honorary doctorate from South Dakota State University Poet CEO Jeff Broin received an honorary doctorate of public service from South Dakota State University during its spring commencement ceremony. Broin built the company from a small 1 MMgy operation into the largest biofuels producer in the world, with 1.8 billion gallons of annual fuel production and 10 billion pounds of high-protein animal feed, among other products, according to Poet.

“Thirty years ago, I made a decision to move to Scotland, South Dakota, a place I had never been, and become general manager of a nearly bankrupt ethanol plant,” Broin said. “My dad put his farm on the line for this project, and I knew failure wasn’t an option. Our will, determination and faith were tested daily, but it was those values that helped get Poet to where it is today. I am incredibly humbled and honored by this recognition and will forever treasure this moment.” Daniel Scholl, interim dean of the SDSU College of Agriculture and Biological Sciences, said, “Mr. Broin epitomizes SDSU’s role to prepare people to innovate, to do things in new ways that add real value to the lives and well-being of our communities. It is a privilege for SDSU to recognize Jeff ’s contributions by this honorary doctorate degree.” Broin holds a degree in agricultural business from the University of Wisconsin-River Falls.


Didion achieves EPA efficient producer status In early May, the U.S. EPA approved an efficient producer pathway for Didion Ethanol LLC, allowing the facility to generate renewable identification numbers (RINs) under the Renewable Fuel Standard for nongrandfathered volumes of ethanol. The plant, located in Cambria, Wisconsin, has a nameplate capacity of 50 MMgy. Ethanol plants that have approved efficient producer pathways are able to generate RINs for production volumes above those grandfathered under current RFS regulations. According to documents published by the EPA, the Didion ethanol plant achieves a 20.5 percent greenhouse gas reduction from baseline gasoline levels. A typical natural gasfired dry mill ethanol plant that produces 100 percent dry distillers dried grains achieves a 16.8 percent GHG reduction when compared with the gasoline baseline.

Rayeman Elements sells drying system to Lincolnway Energy Rayeman Elements Inc., in conjunction with its partner Nationwide 5 LLC, has completed the sale of its second production unit to Lincolnway Energy of Nevada, Iowa. Rayeman Elements, based in Berthoud, Colorado, has developed, designed and manufactured a new, patented grain drying system. The Rayeman Compression Dryer uses heated screws to squeeze water out of wet grains. Lincolnway Energy is developing swine and poultry feed, branded as PureStream Protein.

Praj celebrates inauguration r of second-generation plant On May 7, Praj Industries Ltd. unveiled a demonstration-scale biorefinery near Pune, India, capable of producing 1 MMly of cellulosic ethanol. According to Praj, the facility can process a wide range of biomass feedstocks, including rice and wheat straw, cotton stalk, bagasse, cane trash and corn cobs and stover. The facility also features the companyâ&#x20AC;&#x2122;s proprietary platform technology, Enfinity, for the manufacture of ethanol from agricultural waste.



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for the Ethanol Process Access to additional markets and plant efficiencies give bottom-line significance and meaning to the often-generalized termâ&#x20AC;&#x201D;sustainability. By Luke Geiver

22 | Ethanol Producer Magazine | JULY 2017

For most industries—etha- understanding of how sustainnol production included—the ability can impact U.S. ethanol practice of sustainability is a producers. “The idea of sustainability is grey-area topic: It’s hard to de- always a good topic [for ethanol producers] be involved in,” DeLong says. “Producfine and even harder to put a val- to ers can play in a worldwide market if they ue on. Gary DeLong, an Urban- have the right certifications.” dale, Iowa-based, sustainability Although the current opportunity for consultant and auditor who has U.S. producers to export to Europe is limited traveled the world through his because of tariffs and the European Union’s Renewable Energy Directive requirements role at Degart Global, has a clear

on renewable energy sources and feedstocks, DeLong works with ethanol clients to help them understand the opportunities for exports into South American, Japanese or other overseas markets that require some form of sustainability certificate. He also works with ethanol clients focused on serving future markets that might open as soon as they are certified sustainable, including California’s. Based on DeLong’s experience and expertise on providing the appropriate certifications for the right markets all over JULY 2017 | Ethanol Producer Magazine | 23


Current and Former ISCC Certified U.S.-based Entities Plymouth Energy LLC, Merrill, Iowa

Lansing Ethanol Services LLC, Overland Park, Kansas

Green Plains Inc., Omaha, Nebraska

Poet Ethanol Products, Wichita, Kansas

Renewable Products Marketing Group, Shakopee, Minnesota

Petrobras America Inc., Houston, Texas

Lyondell Chemical Co., Houston, Texas Alcotra North America Inc., Houston, Texas Murex LLC Ltd., Texas City, Texas

Noble Americas Corp., Stamford, Connecticut Arkalon Ethanol LLC, Liberal, Kansas Lyondell Chemical Co., Houston, Texas

Astra Oil Co. LLC, Houston, Texas

International Corp., Long Lake, Minnesota

Arkalon Ethanol LLC, Liberal, Kansas

M-Pact BioFuels LLC, Chesterfield, Missouri

Cargill Inc., Wayzata, Minnesota

Central Indiana Ethanol LLC, Marion, Indiana

Central Indiana Ethanol LLC, Marion, Indiana

Platinum Ethanol LLC, Arthur, Iowa

Platinum Ethanol LLC, Arthur, Iowa

Chippewa Valley Ethanol Co. LLLP, Benson, Minnesota

24 | Ethanol Producer Magazine | JULY 2017

the world, he says for U.S.-based ethanol producers, the value of sustainability all starts with the International Sustainability and Carbon Certification process.

Earning A Sustainability Certificate

The ISCC is a set of sustainability certification criteria developed by Germany. The ISCC group is a nonprofit and was formed to address the EU’s Renewable Energy Directive requirements that call for a reduction in greenhouse gas (GHG) emissions and a verification system to ensure land use change has not occurred during the production of renewable energy. According to DeLong, there are currently more than 10,000 ISCC certification holders in the world and only two sets of other standards meet the same requirements of the ISCC. U.S. producers eyeing export markets in Europe have to become ISCC certified, and

U.S. producers eyeing export markets in Europe have to become ISCC certified, and Gary DeLong predicts those looking to serve the California market will, too. DeLong predicts those looking to serve the California market will, too. The California Air Resources Board held meetings with the ISCC earlier this year to discuss the possibility of adopting or finding compatibilities between ISCC’s standards and CARB’s. As a possible indication of things to come, the ISCC set up an office last year in San Francisco. Although the discussions are still ongoing, DeLong says the two entities are a good match. Some ethanol producers in the U.S. are certified already. DeLong has worked with more than 10 to perform the auditing and


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approval process. The ISCC’s objective has three main elements: The feedstock used to produce a biofuel must meet land use requirements; workers linked to the feedstock and fuel production process must be paid fairly; and the biofuel product must provide a 50 percent GHG reduction when compared to standard gasoline blends. During a three- to five-day period, a third-party auditor will visit the corn growers, the elevator or grain storage facilities and the ethanol production site. Farmers must sign a statement of conformity that signals their feedstock is in compliance


The Certification Process

Information used by the third-party auditor to certify feedstock traceability:

• Statements of conformity from farmers supplying feedstock. • Chain-of-custody verification of grain handling, conducted at the elevator or other first gathering point. • Chain-of-custody verification and grain evaluation, conducted at the ethanol plant.

26 | Ethanol Producer Magazine | JULY 2017

with the requirements of the certification protocol. The farmers are not paid any extra to go through the process. “Farmers are always happy to participate,” DeLong says. “They are participating in marketing of corn and ethanol by going through the process.” On average, nearly 90 percent of all feedstock providers participate in the process. After the auditor gains the statement of conformity from the farmers, the next step takes place at the first gathering point of the feedstock, typically an elevator or warehouse. At this point in the process, the auditor must certify the chain of custody and the type of grain that will be sent to the ethanol plant. Next, the auditor must visit the feedstock conversion facility, or the ethanol plant, to once again verify the chain of custody and type of grain received. The auditing process utilizes a mass balance system, so an ethanol plant doesn’t need to separate grain that can be used for the certification process from other grain not being used in the ISCC process. The goal throughout the process is to provide a certifiable traceability of the grain used that results in a certain finished ethanol blend. The ISCC’s final ethanol blend is drier than that of the U.S. ASTM’s standard. Following the conversion facility step, the auditor then meets with the biofuel supplier or marketer to certify the chain of custody of the biofuel once more. The supplier can then pass the certificate granted by the ISCC onto the buyer. “All along the way the idea is to keep track of the product before it arrives to places such as the Port of Rotterdam,” DeLong says. The third-party certification is required annually. Producers that have participated to date have done so to keep their market opportunities open in the future. “They need to keep informed on the markets due to the fact that some may open up,” he says. In many cases, some plant rework has to be performed. “Tooling and revamping was needed. You need a drier ethanol product,” DeLong says. In some cases, his clients had

to add molecular sieves to take more water out of ethanol product and give it a higher alcohol content. For producers yet to be certified but interested in the process, the first step is to become informed about sustainability and what it means to be certified sustainable in different markets, DeLong says. Next, producers should get an understanding of what their particular biofuel product’s lifecycle GHG thresholds would be. After that, a discussion with a consultant or certification body is necessary to help the producer understand if the work, time and investment into the process is worth it for the chance to have access to certain fuel markets, DeLong says. Currently, 22 U.S. ethanol-related entities are on the ISCC’s list of certificate holders.

More Than One Meaning

ISCC certification isn’t the only path to sustainability. Mark Marquis, CEO of Marquis Energy, says sustainability for his production entity is measured in carbon intensity, but it also is viewed as an economic driver used to push down production costs. “Marquis continually evaluates technology to remain on the cutting edge in ethanol production and our sustainable investments allow us to meet efficient producer pathway status within the Renewable Fuel Standard,” Marquis said. To date, the company has worked to reduce its carbon footprint by investing in CO2 scrubbing, efficient steam generation systems and plant automation. The plant’s automation system helps prevent errors and reduces the variability of process streams. Process automation also helps sustain production by preventing unforeseen downtime. “Reduced variability and increased operational efficiency improve our sustainability and bottom line,” Marquis says. Automation also is used to highlight how close the plant is to reaching key production indicators, he says. Although the Marquis team places a major emphasis on sustainability of production and feedstock used—the company’s website has its own tab devoted to

the topic of sustainability—the producer is not currently on the ISCC’s list. But, based on the goals of the Marquis team, certifications of sustainability such as the ISCC or others could be of interest in the future to Marquis or producers looking to expand. “We believe in moving from being an ethanol producer to being in a biorefining mode, which is aimed at dividing comingled streams into new sources of revenue,” he

says. “It’s our goal to have five sources of revenue (up from our current three) in the next five years.” Author: Luke Geiver BBI International Staff Editor 701-738-4944

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Meeting Needs, MAXIMIZING BENEFITS Farmers continuously implement new environmentally friendly techniques to raise their crops. By Ann Bailey

Corn farmers—and with them, the In Practice ethanol industry—are growing more Many sustainability-minded corn farmers are sustainable. using variable rate fertilizer technology, says Brent Farmers in corn states are embracing a variety of sustainable agriculture production practices, including strip farming, planting cover crops and improving soil health, to reduce their environmental footprints. The term sustainable agriculture has many definitions, but Kendall Lamkey, chair of the Iowa State University Department of Agronomy and a longtime sustainable agriculture expert, likes this one best: “Practices that meet current and future societal needs for food and fiber, for ecosystem services and for healthy lives, and that do so by maximizing the net benefit to society when all costs and benefits of the practices are considered.” Corn farmers in the U.S. already are the most environmentally friendly, efficient producers in the world, says Paul Bertels, vice president of production and sustainability for the National Corn Growers Association. “It’s not an endpoint,” he says. “It’s a journey. It’s a constant and continuous improvement. That’s what sustainability is really about. When you look at ethanol, when you look from either the greenhouse gas score or at overall sustainability, it all comes back to feedstock.” The better corn’s score, the better it is for the ethanol industry as a whole, Bertels says.

Hostetler, a Plains City, Ohio, farmer and member of the NCGA’s Stewardship Action Team. The variable rate technology allows farmers to pinpoint how much fertilizer needs to be applied to specific areas of the field, rather than applying the same amount across the entire acreage. And his area has seen an increase in cover crop acreage. Research shows cover crops can reduce nitrate leaching by an average of 30 percent, Lamkey says. The cover crops utilize water, which, in turn, reduces the amount of nitrogen that potentially could run off into waterways. “Then when those plants are burned down, over time, some of that nitrogen gets returned to the soil and it will be useful,” Lamkey says. “Cover crops are working.” A sustainable farming practice, which the Iowa State University Department of Agronomy encourages corn farmers to employ, is Science-Based Trials of Rowcrops Integrated with Prairie Strips (STRIPS), which involves planting strips of prairie in fields. Fields with moderate to severe slopes that are planted 10 percent to prairie strips show more than 90 percent reduction in soil loss, Lamkey says. The amount of nitrogen leaving the field is reduced by as much as 85 percent, the research shows. “It’s amazing,” Lamkey says. “Another thing a lot of producers

TAKE COVER: Research has shown that using cover crops can improve farm resiliency, boost yields and improve wildlife habitat. In Iowa, about 600,000 acres were planted with cover crops in 2016. PHOTO: IOWA STATE UNIVERSITY DEPARTMENT OF AGRONOMY

28 | Ethanol Producer Magazine | JULY 2017


like about it is they get to see a lot of wildlife returning to the landscape. I think that’s a cool thing, too—reintroducing diversity.” The NCGA also encourages its farmermembers to use sustainable production techniques such as strip farming and planting cover crops, Bertels says. “First and foremost is the Soil Health Partnership.” The program, launched about three years ago, encourages farmers to employ strip farming and then conducts research on how it can improve soil health. “We have about 100 demonstration farmers throughout the Midwest right now in this program and each of these farms in the fall have a field day, bring in their neighbors and talk to them about what they’ve done, what they’ve learned. In addition, they’ll give them scientific data that shows what’s actually happening in the soil.” A second program NCGA has underway addresses water quality and nutrient management. The program encourages corn farmers to adopt voluntary nutrient management programs, Bertels says. “The key thing here is fertilizer is expensive, let’s make sure we’re put-

ting it down and the plant is using it, that we’re not losing it to the environment.” The nutrient management programs are state-specific, Bertels notes. “What farmers in Minnesota are facing is different from farmers in Ohio. We want each state to tailor plans to regulations that are currently in place or may be coming along.” Another key NCGA sustainability program is the Life Cycle Analysis of corn, Bertels says. There have been at least 20 studies on various crops conducted over the years, but they have treated corn as monolithic practice, even though farmers vary their practices from farm to farm and even within fields, based on soil types. The University of Arkansas will conduct a life-cycle analysis on corn for the NCGA, Bertels says.

Individuals, Economics

It’s important that farmers in individual states have latitude to employ the nutrient management and water quality methods that are best for their farms, Lamkey says. “I think this idea that we’re going to run a monocul-

ture of a practice across the land and achieve sustainability is kind of a misnomer. It’s very complicated. One of the things that we’ve been trying to point out is that sustainability is not a single-dimensional thing.” He also says using sustainable practices should be voluntary for farmers. “I think regulations could make it worse. I think if we regulate nitrogen as a fertilizer, it’s going to end up causing more problems than it will solve.” Policymakers have opinions, but don’t know the right mechanisms to solve the problem, Lamkey says. “We’ve been working hard to get those mechanisms down. I’ve been involved in modeling. We have to model this as a system. It’s too complicated to understand as a onedimensional kind of plan. My goal in building a modeling group in this department is to be predictive. I tell people, ‘I get up every morning and look at the weather forecast and then I look outside to see what it actually is doing. If you merge those things together, you know how to dress that day. Farmers will do the same thing, when they can.’”

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Lamkey says modeling is important to production agriculture. “Right now farmers have to run experiments in their own fields, conduct on-farm trials to figure out how their management practices are going to work, and I think we can get some pretty good ideas to model before they get out there.” Another significant challenge is ensuring sustainable agriculture practices make economic sense, Lamkey says. “I don’t know any producers that don’t want to do things differently, but the question is, how do they do it and still make money?” Hostetler concurs. “Part of sustainability is making economic sense. That is key to sustainability. If I can’t be sustainable economically, I am not sustainable.” For example, planting a cover crop, while environmentally sustainable, isn’t always feasible, because in wet years, the cover crop holds in the water and delays spring planting, he says. But research will continue into sustainable methods that will help both farmers and the land they farm. “Keep tinkering with the mix, I think eventually they will figure it out.”

Changing the Landscape

Diversifying the landscape is important from an agronomy point of view, Lamkey says. “In states like Iowa, southern Minnesota and Illinois, in these big, organic-matter, tiledrained areas, we’re going to have to figure out how to put some of the land that’s leaching the most nitrogen back into perennials.” Although corn acres in those states have remained fairly consistent since the 1940s, soybean acres have dramatically increased and replaced pastureland and crops such as alfalfa and oats, Lamkey says. The switch changed the hydrology of the states because corn and soybeans are now the main water consumers during July and August. Conversely, most nitrogen is leached from March through June, when there are no crops on the fields. “What we are trying to figure out, and it’s very difficult, is what areas of the landscape do we return to perennials?” Lamkey says. “That would have a big impact on the leaching of nitrates into our water system. “I think we’ll figure it out, but I don’t know how farmers would be able to make a living from that, so we’re going to have to fig-

ure something out,” Lamkey says. “What I’d like to see us working on in a state like Iowa, with a large ethanol industry, is we need to take some key land out of production and I think we need to think about how to use that land to make money. I think there are a lot of ways that can happen.” If the land is going to be taken out of production, researchers will need to figure out how to boost corn yields, Lamkey says. “I think it’s imperative for us to understand what additional changes in the management system we need to make to get yields up so we can get corn yields without causing environmental issues.” Although sustainable agriculture continuously evolves, one thing is certain. “We know that our growers are doing the right thing and we’re getting better at it,” Bertels says. Author: Ann Bailey Freelance Journalist

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Charged Up Is it the right time for ethanol producers to consider going solar? By Patrick C. Miller

From an economic perspective, now might be the time for ethanol producers to consider installing a solar array to generate electricity for their operations. But from a technical perspective, producers also should be aware of the challenges. Nicholas Franco is the director of sustainability for the Kinect Energy Group in Plymouth, Minnesota. The company serves about 40 percent of the U.S. ethanol industry by assisting producers in obtaining electricity and natural gas at the lowest prices possible. Kinect Energy has conducted studies and financial modeling for some of its ethanol clients on how they could use adjacent land to build a solar array for electrical generation. Based on his company’s work, Franco sees a number of motivations for producers to take a serious look at solar energy, ranging from reduced solar equipment costs to regulatory changes to tax incentives to hedging against future power cost increases. “I don’t see anything on the horizon that’s a big negative for the ethanol industry for solar,” he says. “You can approach solar from a number of perspectives: It’s helping you lower your carbon intensity and it’s helping reduce your input price volatility on the electricity side. Prices are going to keep falling because it’s an international market, not a U.S. market in terms of the prices of the components that go into it.”

32 | Ethanol Producer Magazine | JULY 2017

JULY 2017 | Ethanol Producer Magazine | 33


“Over the past year or year and a half, we’ve had maybe five or six (ethanol) clients who have been serious in terms of investigating solar and paying us to do a study for them.” - Nicholas Franco Director of Sustainability, Kinect Energy Group Plymouth, Minnesota

Lyle Olson, a retired mechanical engineer in Le Sueur, Minnesota, has an MBA and more than 50 years of experience in helping industrial and commercial clients improve their manufacturing processes. He’s currently working as a consultant with a Minnesota ethanol producer studying whether solar energy makes sense for its plant. Olson believes ethanol producers should consider solar energy for another reason. “If you really believe in renewable energy, why aren’t you using renewable energy to make renewable energy?” he asks. “If you really want to have an environment for

future generations to live in, the ethanol industry should look at everything it does and ask whether we’re doing it the best way.” But Olson also firmly believes ethanol producers who want to incorporate solar energy into their operations should fully understand the technical issues involved and potential problems. They also need to understand the difference between what solar vendors want to sell and their plants’ needs, he says.

Economic Incentives

On the economic side of the equation, Franco says two regulatory standards

should make solar energy more attractive to ethanol producers. “California has a low-carbon fuel standard that’s based on the carbon intensity of the ethanol you produce,” he explains. “The lower the carbon intensity of your ethanol, the higher premium you can get for selling into that market.” For ethanol producers that want to sell in the California market, the financial incentive is to earn a lower carbon intensity score. Franco says the key questions are: how much does each megawatt of solar energy generated reduce a plant’s carbon intensity; and how does this translate in terms of a premium for ethanol sold in California? “Over the past year or year and a half, we’ve had maybe five or six clients who have been serious in terms of investigating solar and paying us to do a study for them,” he says. “We did some modeling for one about the carbon benefit. We showed them the payback just for power price and for the carbon reduction benefit, as well.”

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The other incentive is the Renewable Fuel Standard, which initially set a carbon intensity level while grandfathering in existing ethanol plants. Franco says that if those plants can use solar energy to show theyâ&#x20AC;&#x2122;ve reduced their carbon intensity to meet the current standard, they can produce RINs above their grandfathered levelâ&#x20AC;&#x201D;the renewable identification numbers used by obligated parties to demonstrate compliance with the RFS. â&#x20AC;&#x153;The difference between the two programs is that in California, itâ&#x20AC;&#x2122;s a sliding scale in terms of carbon intensity reductions,â&#x20AC;? he notes. â&#x20AC;&#x153;In the Renewable Fuels Standard, there are step reductions. If youâ&#x20AC;&#x2122;re 20 percent below the standard, thatâ&#x20AC;&#x2122;s the first step. The next (for advanced biofuels) is 30 percent and then 50 percent. You donâ&#x20AC;&#x2122;t get any benefit at being between 30 and 50 percent. If youâ&#x20AC;&#x2122;re 40 percent, you havenâ&#x20AC;&#x2122;t hit that next threshold and thereâ&#x20AC;&#x2122;s not a lot of financial value. You need to move those step changes to increase the value in terms of your product.â&#x20AC;? Ethanol producers also are looking at solar energy as a hedge against rising electricity prices because all the costs are upfront. â&#x20AC;&#x153;Once youâ&#x20AC;&#x2122;ve paid for it, there are ongoing [operation and maintenance] costs, but theyâ&#x20AC;&#x2122;re very small,â&#x20AC;?

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Franco explains. “You’re essentially generating electricity with no fuel cost. You’ve locked in a fixed price for your power now. As utility power prices increase, you have a hedge against those rising prices. You’re not experiencing as much volatility as you otherwise would.” Another economic factor Franco says producers should consider is the large federal tax incentive for solar energy, which is currently 30 percent until 2019. In 2020, it will drop to 26 percent, 22 percent in 2021 and then 10 percent in 2022.

“The other big incentive is accelerated depreciation,” Franco notes. “Solar’s a 25- to 30-year asset. Right now, you can depreciate it in five years. You can get a huge chunk of money back upfront with a 30 percent tax credit and that accelerated depreciation. In 2017, not only can you depreciate it over five years. There’s currently a bonus depreciation. You can write off 50 percent of that in the first year.” Because of international competition in the solar energy marketplace, Franco says the cost to install solar energy is fall-



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ing. “Technology is marching on and the panels themselves are about 40 percent of the cost,” he explains. “What’s been driving them down is just a huge oversupply of the market. China, at one point, had been subsidizing the development of their industry. A couple years ago, the statistic was that there’s three times as much manufacturing capacity as there was demand. With that kind of oversupply, you’re seeing incredible price pressure.” The payback time on the capital investment for solar energy is an aspect of concern to the ethanol industry, but Franco says the industry’s expectations are more reasonable than others. “Some of our manufacturing and commercial and industrial clients want to see paybacks in two years or a year and a half, which is really hard to do for almost anything,” he says. “Ethanol plants are usually okay with five, six or seven year paybacks.” But Olson says he has found payback and financing to be major issues. “Ethanol plants, if they’re well-managed, like to get their investment capital back in three years or less, and it’s pretty hard to do that with solar power,” he says. “It makes it a tougher sell.” Franco and Olson agree that when it comes to solar energy, one advantage the ethanol industry has is a plant’s electrical demand is relatively flat compared with other commercial and industrial operations. Solar’s ability to produce power during an ethanol plant’s peak electrical demand also makes it an attractive option. “I’ve done studies on a couple of ethanol plants that looked at their demand history,” Olson says. “There’s usually a peak sometime around midday, which is ideal for solar production. In the summertime, you can have solar production starting as early as 6 o’clock in the morning and go to as late as 8 at night. In wintertime, your solar production goes from 9 in the morning and to 3 or 4 in the afternoon. “Regardless of the time of year, the solar production should coincide with the peak consumption period,” he adds. “You have to confirm that to make sure you’re going to get the right benefit from solar.”

Integration Education

In advising ethanol plant managers, Olson says it’s important for them to understand in detail all aspects of their plant’s power consumption and the potential pitfalls of adding a new electrical source to their facility. He refers to it as an educational process. “Solar generation has to be looked at very specifically as to how it’s going to be connected into the plant without a disruption of the plant and a loss of production, and that’s not the way solar developers like to look at things,” he cautions. Before deciding to incorporate solar energy into their operations, Olson says ethanol plant managers should understand the difference between what they need and what solar vendors want to sell them. He compared it to buying a car. “You know what you want, but the sales person knows what he wants to sell you,” Olson laughs. “The car dealership’s philosophy is that we have to sell what we have to sell. My philosophy in doing 50-plus years of process modifications and changes is that I will buy what we know works best for us. “The experience I’ve had with solar generators is that they’ll say, ‘We’ll just plug it in.’ Well you just don’t plug it in,” he continues. “If you have a big solar array, you can’t generate a couple of megawatts of 480-volt power and find a place to connect it. That kind of connection requires the plant to be shut down for a day or two to make it happen.” Olson also understands that ethanol plants are designed to operate like finely tuned machines. Introducing a new element such as solar generation sometimes means the plant has to be re-tuned or it might create new problems. For example, there can be issues with software or with harmonics in the variable frequency drives (VFD) of large electric motors, causing them to overheat or short out. “What can solar generation do to harm harmonics?” Olson asks. “I’ve talked to electric professors and electrical engineers. Everybody has a guess and a comfort zone with what should happen, but we don’t know.”

For these reasons, Olson advocates starting small with solar power and scaling up to larger operations over time. “You don’t have to swim the English Channel to prove you can swim,” he notes. “There’s a certain amount of merit to looking at a small-scale installation. Let’s take the first step, learn from it and then we’ll be a lot smarter in planning the next steps.” In addition, Olson believes adding solar generation over a period of time can fit in with an ethanol plant’s normal operations. “A well-run plant has at least a fiveyear capital plan to keep updated,” Olson says. “As plants age, equipment needs to be replaced, but they also have to look for ways to reduce manufacturing costs or to get more product out for the same cost. Good business folks are going to buy what they need when they need it, see how it works out and see if they want to buy more.”

Olson is optimistic about the future of solar power in the ethanol industry, although he believes it could take years to realize its potential. “I think the solar field is where ethanol was years ago,” he explains. “Henry Ford once said, ‘You can have any car you want as long as it’s black and it’s one I make.’ Solar power is that way now. We’re getting into an interesting part of the learning curve. We need to see a few ethanol plants have some success with them and some good PR coming from them. Then the merits and the economics will prove themselves and people will be doing it.” Author: Patrick C. Miller BBI International Staff Writer 701-738-4923

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JULY 2017 | Ethanol Producer Magazine | 37

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Having captured the low-hanging fruit, debottlenecking and plant optimizations begin a second round. By Susanne Retka Schill By Luke Geiver

The ethanol plants built in the boom of the 2000s were well-designed, process engineers will tell you. In the decade since, op-

erators have found ways to fine tune and upgrade those original designs. The first round of those ethanol plant optimizations is coming to a close and a second round has begun. In the first round, most plant managers tapped into built-in surplus capacity—the engineering overdesign done to ensure plants met their production guarantees at startup. Since then, multiple small upgrades have been applied, many of which were trial-and-error tweaks. “They’ll increase the grind ever so slightly, then see where the equipment can’t handle more capacity,” says Rob Hormell, associate process engineer at Burns and McDonnell. “Early on there was an issue when you increased capacity; you couldn’t get the fermenters filled fast enough, so a lot of plants put in booster pumps.” PHOTO: ZACH KOBRINKSY

40 | Ethanol Producer Magazine | JULY 2017

“A lot of it is around good management—good practices in the plant on the operations side and mechanical side that improve plant uptime and reliability,” says Neal Jakel, vice president of strategy and technology at Fluid Quip Process Technologies. Some of the low-hanging fruit widely adopted by plants, he says, include improving heat exchanger recovery and cleanin-place practices to prevent infections and lost yields, along with better controls. “Things like running the process in a more steady state and running with higher uptime,” Jakel says. “Those are big improvements to the bottom line, in addition to getting more throughput and increased yields.” Greg Loest, principal with Integro Energy, says the first optimizations to be chased were around energy and heat recoveries, chemical optimizations and control schemes, not to forget fermentation itself. “When you are consistent within the slurry tank and you have very low variability in regards to solids, temperatures and en-


that puts a wave on how much alcohol you make, and a wave into distillation and into the dryers—into the whole plant. I’m talking about getting control points down to less than a tenth in variability on the front of the facility.”

Debottlenecking Strategies

BENCHMARKED YIELD: The gallons of ethanol produced per bushel of corn is steadily increasing. The difference between the high and low yields in the Christianson benchmarking program would amount to nearly $2.5 million for a 100 MMgy plant in 2016 at $1.50 ethanol. SOURCE: CHRISTIANSON

zyme additions on the front end, magically the back end of the facility runs extremely smooth,” he says. “That seems very straight-

forward and sounds like a simple process, but it’s not. When you get into the plant and you have 1 percent variability on dry solids,

Each of the process engineers cite multiple small and large projects that brought plant improvements in the first round of industry optimizations that is ongoing today. Some estimate as high as 40 percent of plants have first-round optimizations that can be made, even as the industry moves into the second round of more capital intensive upgrades. “What we’re finding is that these plant operators have tweaked and hot rodded their plants. They’re running them flat out and doing a great job,” says George Baskin, director of innovation projects at Burns and

McDonnell. The obvious improvements have been made at many plants, he says. But now process engineers are turning to more advanced tools to continue debottlenecking. And, vendors are offering innovative technologies as the next round of improvements. While the equipment providers are the experts on their equipment, Baskin says, the process engineers help with successful plant integration. â&#x20AC;&#x153;We realize we canâ&#x20AC;&#x2122;t do much more to these plants without spending large amounts of capital,â&#x20AC;? Hormell adds. â&#x20AC;&#x153;The engineering solution is to analyze the equipment, identify improvement opportunities and target projects. We analyze equipment in unit operationsâ&#x20AC;&#x201D;distillation, cook, evaporation, that type of thing. If evaporation is the limiting factor we identify, then we can talk about ideas to remedy that issue.â&#x20AC;? FQPT has a master list of more than 70 process improvement projectsâ&#x20AC;&#x201D;debottlenecking projects for every part of the plant,

DOWNTIME DIFFERENCE: Christianson benchmarking data also tracks reliability. Downtime is defined by the hours when distillation is down. Plants down for repairs exceeding 25 percent of available hours in a quarter are excluded. SOURCE: CHRISTIANSON

Jakel says. â&#x20AC;&#x153;We provide a service where we go through the entire plant from the front to the back end and we look for the pinch

points. A lot of times, we have simple projects to eliminate those pinch points, because weâ&#x20AC;&#x2122;ve dealt with them in other plants.








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Sample Debottlenecking Projects UNIT OPERATION



Beer Column

Mash carryover issues

Relocate feed control valve next to beer columnâ&#x20AC;&#x201D;reduces flashing and two-phase separation feeding column, reduces carryover within the column.

Fermentation Coolers

Insufficient heat exchange at higher flow rates

Maximize the number of plates within the exchanger frameâ&#x20AC;&#x201D;expands existing ferm coolers by 20 to 30 percent.

Beer Well

Improve chemical handling

Move sulfuric blending point to beer well pump suction and remove the in-line mixerâ&#x20AC;&#x201D;improves safety and pH control.

Elevator Conveyor Legs

Damaged buckets and downtime

Add bucket catcher on all elevator legs to prevent damage and downtime.

Mole Sieve Vaporizer

Steam limitation in heat exchanger

Utilize mole sieve vaporizer steam condensate to lower steam flow to vaporizer.

Slurry Tank

Ethanol flashing

Add a vent condenser to recapture any ethanol flashing in slurry tank.

PROJECT POTENTIAL: A short list of top debottlenecking projects from FQPT shows the range of tweaks possible in multiple systems to incrementally improve process flow. SOURCE: FQPT


- Technical Support - Startup Assistance - Proven Performance - In Stock

3$5.5,'*(,/_ 44 | Ethanol Producer Magazine | JULY 2017

Other times, we may find a new one and weâ&#x20AC;&#x2122;ll engineer a solution.â&#x20AC;? He recommends developing a mass and energy balance for all systems in a plant to establish how the plant is running. â&#x20AC;&#x153;That allows us to model potential future production rates and identify future bottlenecks that we can address today. It basically positions the plant to incrementally start producing more gallons going forward.â&#x20AC;? That sort of comprehensive planning goes a long way toward keeping capital costs down, Jakel says. A project to add 30 MMgy in one fell swoop can cost $1.50 to $2 per gallon. A more systematic approach identifying pinch points, examining mass and energy balance scenarios and implementing strategic improvements planned around scheduled maintenance downtimes can bring that cost down to 10 or 15 cents per gallon, although it may take two or three years to accomplish a capacity expansion. â&#x20AC;&#x153;Itâ&#x20AC;&#x2122;s a capital deployment plan that ties into the plant debottlenecking plan,â&#x20AC;? Jakel says. As Loest describes going back and forth with a plant considering a capital project, it begins to sound like a process engineer acts as a plant counselor. â&#x20AC;&#x153;We reviewed what they wanted to do, and started asking very specific questions about other areas of the facility that hadnâ&#x20AC;&#x2122;t been

addressed. Their idea wasnâ&#x20AC;&#x2122;t going to get them the bang for the buck they anticipated. They need to address a number of other areas that will make them more efficient and give them the flexibility so they can come back and do the project they want to do.â&#x20AC;? In the first round of process improvements, Loest says, â&#x20AC;&#x153;Everybody was fresh out of the gate. A lot of technologies that went into the plant were very straightforward, off-the-shelf, plug-and-play. As the plants have gotten further along and matured in how they operate their facilities and how their markets function, everything is becoming more custom.â&#x20AC;? Different plants have different bottlenecks, different capacity constraints, different mentalities, he says. â&#x20AC;&#x153;So while the core idea might fit, it still has to be tweaked every single time independently.â&#x20AC;?

Beyond Capacity

Just adding gallons is not the answer to future viability, the process engineers stress. While there are some economies of scale that benefit bigger companies, the cost of corn and sale price of ethanol and coproducts are the same for all. Small producers can remain in the game, if they keep up and strive to be low-cost producers.

Jakel points to the maxim that if you’re not growing, you’re dying. “So how am I growing the business? There’s organic growth, which is growth within—constant growth in production, in cost reduction, in efficiency and yield improvement, energy utilization. All those things continually help the bottom line. It makes a plant more cost-competitive in tight-margin environments.” Regardless of size, plant operators with a systematic approach to constant improvement, who are putting money in the right areas, are thriving, he says. “We’ve worked the gamut from small 30 MMgy plants with single owners to 100 MMgy big, corporate run with multiple plants. Multiple technologies, single technologies—we’ve seen it across the board. Honestly, it’s the well-disciplined, well-managed plants, the operations teams who have the technical skills, or know that they need to bring in the technical skills via third party, to optimize the plants. Those plants are the winners for yield and uptime.” Ethanol yield is one metric plants follow closely. The Minnesota-based accounting firm Christianson PLLP collects production and economic data from between 60 and 75 plants participating in its benchmarking program in the past five years. Plants compare metrics to see whether they are average, or land among the leaders or laggards. When it comes to ethanol yield—the gallons of ethanol produced per bushel of corn—the difference between the top and the bottom is significant. The difference of 0.16 gallons per bushel between the leaders and laggards in the 2016 benchmarking program would amount to roughly $2.5 million more in the bottom line for a 100 MMgy plant getting $1.50 per gallon for its ethanol. Connie Lindstrom, biofuels analyst for Christianson, says the plants participating in the benchmarking program are representative of the industry, comprised of large and small producers, as well as single and corporate ownership structures. “What we notice is that the laggards in ethanol yield tend to be the plants that have increased capacity,” she says.

Loest is not surprised. “There’s constant relearning,” he says. Every change in the plant creates a wave that affects every other part of the plant. He firmly believes that in the next round of process improvements, plants must do a better job of utilizing data on a daily and monthly basis. “[They need to] dive deep into the data historian and cross tie that over to the lab to find those little tweaks on efficiency improvement in temperatures and pressures front to back, proper dosing schemes and proper density and water-balance control, and things of that nature.” Loest suggests cost per gallon is a more important metric to track than yield. “Don’t tell me how many gallons you make, tell me what your cost per gallon is, or cost per bushel—that tells me how efficient you are.” There are plants netting 40 cents per gallon that have been innovators trying to set themselves up for the long run, he says, “versus plants that have hung onto their cash and don’t spend money to improve that are making 10 to 15 cents per gallon net. That’s a big spread.” He cautions that as the industry continues to expand production beyond the blend wall, finding markets for the additional ethanol and distillers grains becomes ever more critical and it is inevitable a margin squeeze is going to come. “Now is the time the plants need to be focusing on efficiency. They can’t just be focusing on gallons. They have to be efficient at what they’re doing.” Jakel agrees, “Plant efficiency improvements are the backbone of any good business.” Rather than adding sheer gallonage, he advocates the industry move toward product diversification. “Revenue growth through product diversification is key to shareholder return and long-term profitability,” he says. Author: Susanne Retka Schill Managing Editor, Ethanol Producer Magazine 701-738-4922

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Following a successful installation at Pine Lake Corn Processors in Iowa, Whitefox Technologies is poised to eliminate molecular sieve regeneration cycles from ethanol plants forever. By Tim Portz

Every day in the ethanol industry, millions of gallons of finished, dehydrated ethanol is combined with water and flushed through the process from which it just emerged, moving back one whole step. Producers do this be-

cause the dehydration process for their post-distillation water/ethanol mix requires it. The zeolite beads at the heart of the molecular sieve used for dehydration resemble frozen grey peas. These beads have a strong affinity for water, collecting it as the water/ethanol passes through them and leaving nearly pure ethanol. The challenge is that, like a sponge, zeolite beads have a finite capacity to attract and hold water, and must be periodically purged of accumulated water. This is accomplished by reversing the process and pushing ethanol back through the beads. The water and ethanol mix that emerges from that regeneration step is reintroduced to the plantâ&#x20AC;&#x2122;s distillation column and the distillation and dehydration process begins again. The ethanol required to purge the molecular sieves can be thought of as a plantâ&#x20AC;&#x2122;s dehydration parasitic load.

48 | Ethanol Producer Magazine | JULY 2017

A DEHYDRATION EVOLUTION: Pine Lake Corn Processors in Steamboat Rock, Iowa, uses Whitefox Technologies Ltd.â&#x20AC;&#x2122;s simplified dehydration process for ethanol production. The system could eliminate mole sieve regen altogether. PHOTO: TIM PORTZ, BBI INTERNATIONAL

JULY 2017 | Ethanol Producer Magazine | 49


“Plants often have between 20 to 30 percent of their production assets tied up in regeneration,” says Gillian Harrison, CEO of Whitefox Technologies Ltd., based in London. The volume of ethanol recycled through plant molecular sieves across the industry is approaching 10 million gallons per day. Harrison stresses that they are finished, saleable gallons that are returned to the process because of the limitations of the best-available technology, until now. “When we talk to producers and they start really thinking about the bottleneck their current molecular sieves create with the recycle streams, you sense that they get frustrated with this inefficiency,” she says. Harrison goes on to note that many of the process improvements being made upstream in ethanol plants are getting stuck behind this same bottleneck. “All those yield enhancements that are being deployed right now all go nowhere,” she says.

Continuous Dehydration

WORKING TOGETHER: The Whitefox Technologies Ltd. team frequently discusses its technology with plant operators at Pine Lake Corn Processors, identifying opportunities to enhance and perfect the process. From left: Whitefox Technologies’ Paul Kamp, vice president of Business Development, North America; Gillian Harrison, Whitefox CEO; and James Broghammer, CEO of Pine Lake Corn Processors. PHOTO: TIM PORTZ, BBI INTERNATIONAL

Whitefox Technologies’ integrated cartridge efficiency (ICE) technology requires no regeneration cycle, by virtue of its design and the specific attributes of its unique membrane. The technology relies on a collection of thousands of tiny tubes, about the diameter of angel hair pasta, made entirely of a hydrophilic membrane. As a mix


50 | Ethanol Producer Magazine | JULY 2017



of ethanol and water pass through these tubes, water is absorbed into the wall of the membrane and a slight vacuum pulls the water through. The ethanol in the mix is resistant to the membrane and exits the tube as an extremely dry ethanol. Harrison introduced a laboratory-scale cartridge to North American producers at the International Fuel Ethanol Workshop in 2014. When the stainless steel housing is opened, the mass of tube membranes resembles a bundle of electrical wires. In Harrison’s lab-scale model, about 50 tubes are bundled together. She says each module at Pine Lake Corn Processors has 50,000. “One of the first things people always offer when I tell them our approach is a membrane technology is that the surface area requirement would simply be too great to be practical at their scale,” says Paul Kamp, an ethanol industry veteran now working with Harrison to introduce the technology to the North American market. According to Kamp, this objection is right, but producers need only see the inside of the lab-scale model to understand that the tubes meet the surface area requirement without gobbling up precious plant real estate. “Bingo. Surface area problem solved,” says Kamp, gesturing to the lab scale’s neatly and tightly bound membrane tubes.

The Road to Steamboat Rock

Today, Whitefox Technologies’ membrane dehydration technologies have found a foothold at two facilities. In January 2016, Whitefox Technologies announced it had agreed with Pacific Ethanol to install its first U.S. commercial system in Madera, California. In February 2016, Whitefox announced it had landed its first customer in Iowa— Pine Lake Corn Processors just north of tiny Steamboat Rock in Hardin County. Before 2013, the technology was virtually unknown to North American ethanol producers. Originally developed by Stephan Blum in Germany, the technology was used to reclaim process solvents in the cosmetics industry. Blum appreciated the technology’s ability to separate water from ethanol and recognized it could have other, much larger applicability. Blum knew he needed to develop a turnkey solution. Initially, Whitefox took the technology to Brazil where harsh chemical treatments (benzene and cyclohexane) were used to separate water from ethanol. Blum and Whitefox went to work on learning the engineering realities of industrial-scale ethanol manufacturing. “A large-scale biofuels plant is completely different than a small facility making industrial fuel ethanol at much smaller volumes,” Harrison says. “Smaller systems

have more controls, higher levels of input purity, less issues in terms of mash. All of the things that simply come along with large-scale ethanol production, you just wouldn’t have to deal with at a small-scale facility.” The global financial crisis in 2008-’09 slowed commercialization progress for Whitefox, and with the subsequent economic collapse in Brazil, the company set its sights on the North American market. The team began talking to producers in 2012, and attended its first FEW in 2014. The initial reactions to the technology wasn’t surprising. “You inevitably would hear people talk about fragility of the membrane,” Kamp says. “Other objections were the amount of new piping that producers assumed would be required, or that the maintenance involved in keeping the system up and operational would simply cripple them. Honestly, those are all of the same thoughts I had when I first heard about the technology and why I continue to be drawn to it. These are all honestly nonissues. We find that operators seldom even inspect these modules, they just run and run and run.”

First Things First

At Pine Lake Corn Processors, Whitefox Technology finds itself in the middle of a complete plant overhaul and

JULY 2017 | Ethanol Producer Magazine | 51




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52 | Ethanol Producer Magazine | JULY 2017

TECHNOLOGY expansion. The original facility, designed by Delta-T and built in 2005, had an installed capacity of 35 million gallons. Today, the site at Pine Lake is loaded with contractor vehicles as another 40 million gallons of capacity is installed. The new facility, an ICM design, will be built around the existing facility and will incorporate the Whitefox ICE solutions to handle the side streams from the new molecular sieve units. In February, Whitefox Technologies announced the plant would expand the solution by one-third. Pine Lake Corn Processors CEO James Broghammer said in the news release, “The impact of the Whitefox ICE became evident almost immediately. Overall, I see a better-performing plant with increased capacity and lower steam consumption per gallon of ethanol produced, just by eliminating the mole sieve recycle stream to the rectifier.” With the success of the installation at Pine Lake, coupled with the expansion, is the team tempted to make the leap to complete dehydration by the ICE technology exclusively? “Quite a few producers are already thinking like that, and are asking about that,” Harrison says. “In Europe, this is how dehydration is done. For now, however, we’re all about the stepping-stone approach. It has always been the goal of Whitefox Technologies and Dr. Blum to establish operator comfort with the technology, which is what we are doing now and we’re still learning from this installation.” If the visitor’s log at Pine Lake is any indication, Whitefox Technologies is well on its way to achieving widespread operator familiarity with its technology. Harrison and Kamp are spending a good deal of time at the facility, talking to operators at the plant and welcoming curious visitors from other facilities. “At the end of the day, producers need to remove water from their produced ethanol and we believe this approach is the logical progression in the evolution of dehydration,” Kamp says. Other options are available to address this critical bottleneck, but none deliver the operational advantages the Whitefox ICE solution does, Kamp and Harrison say. With the other options, producers wanting to expand dehydration capacity would have to consider multiple approaches deployed together to achieve the same result. “Plants can always add more dehydration capacity,” Harrison says. “They might even add another molecular sieve bottle. The thing producers realize once they begin to think about molecular sieves is that any capacity they add with a traditional zeolite sieve also increases the amount of ethanol they’ve got to set aside for their bead recycle step.” Distillation columns can be tweaked and repacked if producers believe they are underperforming, she notes. Additionally, another boiler might be installed to address a steam bottleneck. “To get increased capacity, steam savings and cooling water benefits, you’d have to deploy multiple technologies, whereas the Whitefox ICE solution can deliver them in one solution,” Harrison says. “Furthermore, the ICE system completely eliminates the fluctuation that comes along with a recycle step. So long as a plant continues to utilize molecular sieves without the Whitefox system integrated into their operation, the flat, steady operational

state afforded by our system just won’t be possible.” For Pine Lake, the priority was increased capacity. “Initially, James and his team did consider simply adding another bottle of zeolite beads to remove this dehydration bottleneck,” Kamp says. “Interestingly, deploying the ICE system was actually cheaper than simply expanding the molecular sieve unit.” Pine Lake Corn Processors is sold on the new technology. In addition to the expansion of the ICE system it already has installed on its existing production platform, it will also use ICE with the new, additional 40 million gallons of production capacity. “The new plant that is being built was originally being described as 40 million new gallons of capacity, but now they are calling it 50, which makes sense,” Kamp says. Once the second production platform at Pine Lake is complete, the facility will be the largest deployment of the Whitefox ICE solution in the U.S. Kamp and Harrison hope the plant’s location in the heart of the industry means more producers will be tempted to visit. In Harrison’s mind, once operators realize the inefficiency of mole sieve regen, they cannot unlearn it. If the technology continues to perform at Pine Lake Corn Processors with the success it has shown already, the plant could serve as a pivot point in the evolution of ethanol dehydration. Author: Tim Portz Executive Editor, Ethanol Producer Magazine 701-738-4969

JULY 2017 | Ethanol Producer Magazine | 53

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Preventative care for tanks saves money and, potentially, lives. By Cassandra Thomason

Every 3,000 miles, the car goes into the shop for an oil change and tire rotation. At the biannual teeth cleaning visit with the dentist, X-rays or fillings may be called for. Parental worries that inevitably set in once a

newborn goes home from the hospital will be soothed by the confident words of her pediatrician at the first of many scheduled wellness exams. These checkups are all preventative procedures designed to catch a problem before it becomes more dangerous or ex-

pensive, or to pinpoint the cause of a malfunction. Ethanol storage tanks require such inspections to find points of weakness in a tank that could lead to leaks. Leaks that go unnoticed are dangerous and can lead to expensive cleanups and repairs.

CONTRIBUTION: 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).

56 | Ethanol Producer Magazine | JULY 2017

Rules for Inspection

Unlike regularly scheduled physicals or dentist appointments, inspection intervals followed for ethanol tanks are not always clear cut. Steel tanks that hold oil are built to standards set forth by the American Petroleum Instituteâ&#x20AC;&#x201D;API 653. The objective of these standards is to prolong the functional life of oil storage tanks and to ensure the safety of people and communities surrounding the tanks. API 653 covers the maintenance, inspection, alteration and repair of steel, field-erected aboveground storage tanks built to API 650 or API 12C standards. This standard contains the minimum requirements for ensuring the integrity of such tanks. When having an API tank inspection, it is paramount to hire a reputable tank company that offers certified API 653 inspections for bulk storage, petroleum and chemical storage tanks. API 653 inspections must be performed by a licensed API 653 inspector. These inspectors have completed the strenuous API 653 certification program, preparing them to provide thorough, code-specific tank inspections.

INSPECTION TIMING: In-service inspections by API certified inspectors should be done at least every five years. Out-of-service inspections are scheduled based on risk assessments. PHOTO: BBI INTERNATIONAL

Inspection Types

Ethanol producers are well-educated in the potential risks of ethanol storage and do not take the subject lightly. The safety of their employees and continued production are necessary for business. API 653 inspection requirements can get tricky. There are three mandatory API 653 inspectionsâ&#x20AC;&#x201D;the monthly visual, in-service, and out-of-service API 653 inspections are

separate inspections with separate intervals. While ensuring that all three of these types of inspections are completed and repeated throughout the tankâ&#x20AC;&#x2122;s life is the responsibility of the tank owner, only the visual inspection can be performed in-house by a noncertified inspector. The in-service and out-of-service inspections are a different story.

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In-service inspections should be done every five years at the least by a certified API 653 inspector. More frequent inspections might be mandated depending on several factors, including but not limited to, the nature of the product stored, corrosion of tank materials, location of tank, along with jurisdictional requirements. The in-service API 653 inspections should not be confused with the recommended routine monthly visual inspections performed by the ownerâ&#x20AC;&#x2122;s personnel, which are also done without taking the tank out of service. The monthly inspections do not need to be done by a certified API 653 inspector, but are still important to monitor the structural integrity of the tank. Out-of-service inspection intervals must be calculated using the risk-based inspection assessment or corrosion rate procedures. These inspections require the tank to be completely emptied and cleaned in order for the API 653 certified inspector to visually inspect the floor plates and lower tank shell courses. As with in-service inspections, more frequent inspections might be needed depending on the condition of the tank and what materials are being stored. The certified tank company providing the inspection is required to produce a detailed report for each tank inspected for both in-service and out-of-service inspections. These reports include a list of components inspected and conditions found, methods and tests used. Tests may include visual, ultrasonic, liquid penetrant, penetrating oil, magnetic particle, radiography, magnetic flux scan, vacuum box or tracer gas. The report also includes infographic data, photographs and all recommendations for repairs and monitoring necessary to comply with API 653.

Following Through

After the inspections are complete and reports are received, the preventative

58 | Ethanol Producer Magazine | JULY 2017

care work isnâ&#x20AC;&#x2122;t complete. Those recommendations for repairs are not mandatory, but they should be taken seriously and with action to remedy in a timely fashion. Imagine this. A patient shows his doctor a mole on his back. The doctor inspects it and sends a sample to the lab for testing. When the results come in, the doctor informs the patient that his mole is malignant and could spread to other parts of his body. He suggests a procedure that would remove the mole and eliminate the potential of the cancer spreading. The patient takes the paper with the results, thanks the doctor, and leaves the room. He goes home, puts the test results in his desk drawer, and doesnâ&#x20AC;&#x2122;t give them another thought. His doctor has the solution to his health problem, but the patient takes no action to remove the life-threatening mole. He takes his chances with the flaw that might cost him his life. Not addressing recommendations on API 653 tank inspection reports is risky business. A similar warning was given to Freedom Industries following an inspection completed by a certified corrosion engineer in 2013 on their tank. According to an article in Capitol Research published by The Council of State Governments, â&#x20AC;&#x153;West Virginia Chemical Spill Could Lead to Changes Nationwide,â&#x20AC;? the report read that the tank had been â&#x20AC;&#x153;maintained to some structural adequacy but not necessarily in full compliance with API 653 or EPA standards.â&#x20AC;? A 1-inch hole was found in the storage tank. Less than a year later, that tank leaked 7,500 gallons of chemicals into the Elk River. The 300,000 citizens reliant on the municipal water system of Charleston, West Virginia, went without safe, running water for three days. Aside from being a monumental inconvenience to the community, the financial repercussions for the company were devastating. Freedom Industries filed for bankruptcy after the spill.

MANDATORY INSPECTIONS: While monthly visual inspections can be managed in-house, periodic in-service and out-of-service inspections by certified individuals are required. PHOTO: BBI INTERNATIONAL

The chemical released in the Freedom Industries tank spill was MCHM (4-methylcyclohexanemethanol), which is not flammable. A flammable liquid leak, like ethanol, of this magnitude could have been much more catastrophic. Fires and explosions from flammable chemical leaks have the potential to seriously injure those people near the occurrence, as well as destroy the tank, the building it is in or near, and any other object nearby. As ignoring the doctor’s advice is irresponsible for one’s personal health, ignoring the recommendations of an API 653 inspection report is disregarding the safety of every living being that comes into close proximity of that tank with structural weaknesses. Being vigilant with maintaining the integrity of tanks holding ethanol is not a recommendation. It’s a standard that all API tank owners must abide by. A quality storage tank should last for decades if it undergoes timely inspections and proper maintenance, as a car should run longer with consistent intervals of tune ups. Certified API 653 inspectors

have the trained eye to identify issues with oil storage tanks and guide owners in the right direction to fix faults. Putting off these inspections is a gamble ethanol manufacturers shouldn’t be willing to take. Ignoring repair recommendations of an API 653 inspection report is even more of a gamble. Inspect it. Repair it. It’s the doctor’s orders. Author: Cassandra Thomason Director of Research Pittsburg Tank & Tower Group 270-869-9400

JULY 2017 | Ethanol Producer Magazine | 59

Ironically, the latest breakthrough in the field of energy, is a field. While most innovation begins with the seed of an idea, the greatest advance in the making of ethanol starts with a seed. The first corn seed technology specifically developed to increase the efficiency of ethanol production, Enogen® corn can reduce costs by up to 10% and helps generate more ethanol per bushel than any corn feedstock ever grown. Recently named AgriMarketing’s Product of the Year, Enogen is definitely making waves in the field of energy.

© 2016 Syngenta. Enogen ®, the Alliance Frame, the Purpose Icon, and the Syngenta logo are trademarks of a Syngenta Group Company. Syngenta Customer Center: 1-866-SYNGENT(A) (796-4368). MW 1ENG6003_8.5 x 10.875 1/16




ADVANCED BIOFUELS INDUSTRY Carbon credit prices recover and multiple new pathways are certified as the state’s program gets back on track. By Heather Zhang

California’s efforts to reduce carbon emissions from the transport sector are racing to make progress in the advanced biofuel industry, promising healthy growth in demand for sustainable low carbon transport fuel and offsetting any negative effects of pricing drops in the federal program. Developments

of advanced ethanol supply, in both domestic and international markets, have begun to inundate Californian minds as they consider the potential positive effects of a small ethanol feedstock percentage shift that would help fulfill the world’s most ambitious carbon cutting transport mandate—the state’s Low Carbon Fuel Standard. With the California Air Resource Board gradually completing the recertification of the ethanol pathway after the program was

readopted in September 2015, the average carbon intensity (CI) of ethanol has significantly dropped from 81.8 grams of CO2 per megajoule (CO2g/MJ) during the fourth quarter of 2015 to 70.36 CO2g/MJ during the fourth quarter of 2016. The reduction in average CI value has largely been driven by the improved carbon profile of corn ethanol, as well as the increased consumption of other types of ethanol produced from more advanced feedstocks. Compared to

CONTRIBUTION: 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).

62 | Ethanol Producer Magazine | JULY 2017

the more than 9 percent increase in cornbased ethanol use in 2016, consumption of ethanol produced from molasses, sorghum and waste beverages increased more than 114 percent from 2015 to 2016, to 128 million gallons. Brazilian sugarcane ethanol consumption saw an immediate growth when the industry gradually firmed the readoption of the LCFS program during the second half of 2015. LCFS credit prices that had dropped to $20 in early 2015 were driven back to the $90 level seen before the recertification announcement. Despite a shutdown of arbitrage opportunities in 2016 because of the high price of Brazilian anhydrous ethanol year-round, the northbound trade resumed during the first quarter of 2017, thanks to the workable LCFS credits and D5 and D6 RIN spread. RINs are the renewable identification numbers used for compliance with the federal Renewable Fuel Standard. D5 RINs cover advanced biofuels, including sugarcane-based ethanol, while D6 RINs are for conventional biofuels, such as corn-starch ethanol. In addition to the increased volume consumption in the program, the pathway recertification and new applications have built momentum in the advanced ethanol sector. Under CARBâ&#x20AC;&#x2122;s LCFS program, 34

Brazilian pathways have been certified as of May 2017, up from five pathways in June 2016. The average CI value of the 34 pathways was up just over 2 CI points to 46.5 CO2g/MJ, while the minimum CI remained at 38.98 CO2g/MJ. The pathways for sorghum-based ethanol from California, Texas and the Midwest increased to 18 from the 14 pathways last June, with the lowest CI value at 30.63 CO2g/MJ. A new Guatemalan pathway for molasses-based ethanol was approved in May, with CI being evaluated at the level of 40 CO2g/MJ. Besides the already certified pathways in South America, producers are also eyeing opportunities in Mexico to utilize any economic advantage of the local feedstocks.

Brazilian Arbitrage

In early February, the D5/D6 RIN spread stretched as high as 51 cents per RIN, helping breathe some air back into Brazilian ethanol prospects to the U.S. At that time, the arbitrage looked to be close to the breakeven point for Brazilian ethanol with a CI of around 33 versus U.S. ethanol with a CI of around 72. But flexibility by Brazilian ethanol players helped improve export chances, and achievable freight rates to the U.S. West Coast also improved arbitrage opportunities. This triggered the

first volume traded into U.S. in 2017. Since then, the arbitrage opportunities periodically opened based on the intraday RIN and LCFS prices. While D5 RINs were traded in a healthy volume compared with last year, the physical Brazilian ethanol trades also extended Februaryâ&#x20AC;&#x2122;s pace, with talks of several new reservations of Brazilian ethanol. The annual imported ethanol from Brazil to the U.S. is expected to grow from last yearâ&#x20AC;&#x2122;s 8 million gallons. At least two vessels carrying a total of around 20 million gallons of ethanol have been discovered so far this year, with cargos being reserved early and due to be delivered in the second quarter. In late May, sinking anhydrous ethanol prices in Brazil, paired with a midweek draw from inventories boosting U.S. ethanol prices, prompted the price gap between low-CI Brazilian ethanol and U.S. corn-based ethanol to tighten. The spread between D5 and D6 U.S. corn-based ethanol narrowed to under 30 cents because of the improved outlook of D6 RIN prices. U.S. ethanol remains the more cost-effective option on average in the California LCFS market. The forward curve of Brazilian ethanol is likely to see a flat market structure, while any rises in U.S. ethanol prices are likely to be the more uncertain factors affecting international trading opportunities.

JULY 2017 | Ethanol Producer Magazine | 63



Aemetis, California’s largest biofuel producer, plans to move its first-generation footprint to advanced biofuels via a $120 million cellulosic ethanol plant the firm sees as critical to meeting demand growth for clean, high-octane ethanol fuel. The firm expects cellulosic ethanol to achieve CI scores between 20 to 30 CO2g/MJ. At May’s LCFS monthly average price of $73, the cellulosic ethanol would generate incentives of 38 to 44 cents per gallon through LCFS tickets. An improving LCFS outlook is likely to enhance these incentives in the

64 | Ethanol Producer Magazine | JULY 2017

second half of 2017, if the LCFS resumes its uptick. Aemetis also is eyeing a long-planned strategy to improve margins by expanding its overall ethanol production footprint from 60 MMgy to 100 MMgy over the following year, including all conventional ethanol and cellulosic ethanol productions. The firm also plans to improve margins by increasing its share of cellulosic ethanol from zero to 25 to 35 percent. The multinational manufacturer of advanced fuels and chemicals says it expects continued RFS enforce-

ment going forward and positive impacts of driving demand under the LCFS program, creating a healthier supply and demand balance to support expanded investments in the biofuels industry. Propel Fuel, a leading California lowcarbon fuel retailer in 2016, announced its partnership with Pacific Ethanol, which operates low-carbon ethanol plants in Stockton and Madera, California. The partnership will bring locally produced and high-performance E85 to the California market, which can be consumed in flex-fuel vehicles. Propel serves 70 percent of California’s E85 market, which has expanded 600 percent in the past six years to exceed 12 million gallons in 2014. Meanwhile, Pacific Ethanol also received approval from the U.S. EPA to be eligible for cellulosic ethanol production at its Stockton plant, produced from corn kernel fiber. Pacific Ethanol estimates up to 1 MMgy of cellulosic ethanol will be produced at its Madera facility this year. The installation of a 5-megawatt solar photovoltaic (PV) power system at its Madera facility will displace more than 30 percent of the grid power consumed, which should cut utility costs by more than $1 million per year and improve its CI score. In March, CARB approved two production pathways

from the facility, including a corn ethanol pathway with a CI of 72.73 CO2g/MJ and a sorghum ethanol pathway with a CI of 80.51 CO2g/ MJ. LCFS prices in the first half of the year dropped from the high of $100 in late January to the $70 level by the end of May. During the first quarter of 2017, LCFS trades at OTC market saw a liquid session, with over 533,000 tons traded in Q1, up 104 percent from the same period last year, according to Prima data. The SOURCE: PRIMA MARKETS significant increase in trading volumes is largely a reLCFS market will stay tuned and wait for sult of market participants fulfilling the short-term demand during the first quarter, any possibility of uptick of the LCFS in the before they approach the April reporting second half of the year with more supports deadline. On the supply side, utility sector being gained from obligated parties, and auctions increased the short-term contribu- further price balances in the long term with tion of credits during the first quarter and the current banked credits gradually dropsome have argued the workable Brazilian ping down to breakeven level. Compared with last year, the LCFS is ethanol trades contributed additional supply. The actual volume increases, however, faced with less policy uncertainty, as SB32 may not be enough to help the industry and AB197 bills were passed last summer, meet the tougher mandates in 2017. The ensuring the continuation of the program

through 2020. The scoping plan released in late 2016 outlined a 10 percent CI reduction between 2020 and 2030 as the reference case and proposed alternative CI reductions of 25 and 18 percent. Author: Heather Zhang Research Analyst, Prima Markets 630-392-2844

Thermal Refractory Solutions & Maintenance Give the Thermal team a call today! 612-751-2010 We are your Ethanol Refractory Experts! We know your energy center and can provide superior results on your RTO, TO, Boiler, or Dryer. We have installers based from 3 different locations to provide a fast & cost effective solution for your plant. We understand the importance of your operation and will provide the results you need to be running smooth. JULY 2017 | Ethanol Producer Magazine | 65




Proper maintenance and operation of the dehydration process leads to longer system lifespan, higher efficiency. By Mark J. Binns

Molecular sieves are a critical part of the commercial ethanol production process. They allow etha-

nol to be dehydrated past 95 percent purity to nearly 99.9 percent, which is critical to meet the specifications for use as a fuel additive. Like all processes in an ethanol plant, careful attention is required in ethanol dehydration units to care for the molecular sieve (also referred to as mole sieve beads, desiccant or zeolite). Proper preventive maintenance, care during the actual operating process and awareness of what can cause long-term damage to the beads and vessel, or bed, are crucial. Proactively monitoring and maintaining sieve beads is imperative to

ensure a long, efficient lifespan of up to 10 years. Understanding the dehydration process and following a few simple rules can extend the lifespan of molecular sieve beads. Talk to a sieve professional—we’ve seen it all.

Don’t Wet the Bed

Great care should be taken to ensure the process stream reaches and remains in vapor phase when flowing into the vessel and during operation. If the vapor condenses back to liquid phase, it can severely affect the mass transfer dynamics of water into and out of the vessel, which leads to a reduced working capacity and possible damage to the beads. When a

process stream in liquid phase enters an ethanol dehydration bed, water can form a layer around each bead, essentially coating it with liquefied water because of water’s cohesive properties. Beads coated in liquid water slow or completely prevent the adsorption of vapor phase impurities (water) from the desired, pure ethanol product stream. To prevent the occurrence of liquid phase molecules during any point of the dehydration process, it is critical to achieve and maintain a feed stream at maximum pressure with 50 degrees Fahrenheit of superheat—50 F over the condensation temperature. The optimum superheat of 50 F offers a temperature high enough to prevent vapor from returning to liq-

CONTRIBUTION: 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).

66 | Ethanol Producer Magazine | JULY 2017

uid phase, while remaining low enough to not significantly reduce working capacity of the sieve beads inside the vessel. Working capacity directly correlates with operating temperature, as beads in high heat have a lower working capacity, thus too much heat during operation is not desirable either. Properly insulated vessels and pipes are also important to avoid cold spots or uncontrolled changes in temperature of the feed stream, especially during cold, winter months.

Donâ&#x20AC;&#x2122;t Bounce the Bed

sound resembling screaming or high-pitched whistling. Once critical velocity is exceeded, beads can shatter and crack, causing excess dust, an increased need for top-offs in lateral units and jeopardization of overall working capacity, and could eventually require a full change-out to restore productivity.

Pay Attention to pH

A three-angstrom (3A) molecular sieve, such as the EthaDry offered by Hengye Inc., is specifically designed to dehydrate ethanol,

with crystal pore openings measuring about three angstroms in diameter. This sieve is ideal for ethanol production because water molecules measure about 2.8 angstroms, while ethanol molecules are about 3.6 angstroms. Water can pass into 3A crystals and be trapped, while ethanol molecules are too large for adsorption and bounce off the crystals. If molecular sieve beads are exposed to pH that is too high, it can induce an ion exchange, changing 3A sieve crystals into 4A or larger sieve crystals, ultimately allowing ethanol

Proper velocity control inside the bed must be carefully monitored to ensure that the fluidization velocity is not exceeded, as specified by each unique system, to avoid Levi's expansion. Fluidization velocity is a function of bead size, flow rate, vapor density, vessel pressure and feed stream temperature. Levi's expansion occurs when the beads are lifted and suspended in the air on a cushion of vapor, a process known as fluidization. When fluidized, the beads can grind against one another, resulting in high attrition, dusting and possible cracking. In turn, cracked beads can lead to channeling of the mass transfer zone through the bed, causing an uneven, early breakthrough, a negative feedback loop and repeated damage each cycle. These sudden changes in pressure, caused by sticking valves or improper pressurization of the vessel, can cause instantaneous fluidization, or the literal bouncing of sieve beads inside of the vessel, sometimes referred to as popcorning. Consult with a sieve professional for assistance to better understand the capabilities of unique ethanol dehydration units. Routinely check valves to confirm proper function, hold team meetings, encourage continuing education on proper pressurizing conditions and teach the benefits of preventative maintenance to increase efficiency and successful operation.

Donâ&#x20AC;&#x2122;t Exceed Critical Velocity

Avoiding critical velocity is necessary to prevent damage to dehydration units and the sieve beads inside. Each piece of equipment in a system has a limitâ&#x20AC;&#x201D;a maximum pressure that can be handled without causing damage. When the vapor rate for a plant's unique configuration is too high, vapor velocity can exceed critical velocity levels, which causes a JULY 2017 | Ethanol Producer Magazine | 67

DEHYDRATION molecules to be adsorbed alongside the water, decreasing capacity. If exposed to a feed stream with pH too low, sieve beads will dissolve and fuse into clumps. An ideal feed stream should maintain a pH between 4.5 and 9.0 to prevent any ion exchanges or bead fusion. As a part of preventative maintenance, operators should pay extra attention to ensure clean-in-place chemicals, such as sulfuric acid or caustic soda (sodium hydroxide), are thoroughly washed away and not allowed to pass into sieve vessels.

Avoid Contamination

Low molecular weight carbohydrates, in the form of water soluble sugars, and fusel oils can cause significant changes to working capacity in ethanol dehydration units. The carbohydrates come from water soluble sugars that remain in the process stream along with other contaminates, in micellar compounds, which are passed into the beds. These contaminants attach to the outside of molecular sieve beads in a process referred to as coking, creating a layer of coke, or burned carbohydrates. Coke

begins to appear as dark spots and, over time, can create a complete layer around the surface of the beads, ultimately turning the beads black. The layer of coke prevents vapor from entering the microchannels within each bead that allow water to be adsorbed by the molecular sieve crystals, thus causing a drastic decrease in working capacity and loss of efficiency. The easiest method of reducing hydrocarbonsâ&#x20AC;&#x201D;sugars, fusels and other contaminantsâ&#x20AC;&#x201D;is to install demister pads or coalescing filters between the vaporizer and the dehydration unit. These filters essentially are packed layers of steel wool that trap contaminants and clean the vapor stream as it passes through. After installing these filters, preventative maintenance teams should check the drain on the bottom of the filter and replace them as needed to significantly reduce the occurrence of coke and preserve the working capacity and mass transfer rate within the vessels. Proper care for the molecular sieve in the dehydration unit is an important part of the ethanol production process. Operators should ensure that the process stream reaches and re-

mains in vapor phase, carefully monitor pressure changes, avoid reaching critical velocity, and prevent strong acids and bases, or contaminants that can cause coking, from entering the vessels. Any of these occurrences could cause damage to sieve beads, leading to decreased working capacity, issues with mass transfer rate and eventually total failure of the unit. Educating operatorsâ&#x20AC;&#x201D;including training on what not to doâ&#x20AC;&#x201D;and establishing regular preventative maintenance can increase the lifespan and efficiency of molecular sieve, creating long-term savings and increased profitability. Author: Mark Binns Technical Business Director, Hengye Inc. 502-232-5356

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OSHA Rescinds Union Walkaround Memo By Ryan Funk

Heralding a shift at the Occupational Safety and Health Administration, the U.S. Department of Labor has confirmed that an Obama administration OSHA memorandum permitting union or community organization representatives to take part in OSHA workplace walkthroughs of nonunion employers has been rescinded. Following the announcement, the National Federation of Independent Businesses voluntarily dismissed a legal challenge to the memorandum. The 2013 OSHA guidance memorandum interpreted Section 8(e) of the Occupational Safety and Health Act, which provides that “[s]ubject to the Secretary’s regulations, a representative of the employer and a representative authorized by his employees shall be given an opportunity to accompany the Secretary or his authorized representative during the physical inspection of any workplace … for the purpose of aiding such inspection.” Previously, OSHA had allowed only certain third-party specialists such as industrial hygienists and safety engineers to accompany the inspector, and only when their presence was reasonably necessary. The 2013 memorandum responded to questions posed to OSHA by the United Steelworkers International Union, including: “May workers at a worksite without a collective bargaining agreement designate a person affiliated with a union or a community organization to act on their behalf as a walkaround representative?” The agency found that a union representative could accompany an OSHA inspector, if the inspector thought the union representative would make a positive contribution to a more thorough and effective inspection. The memorandum suggested reasons the inspector might justify permitting a union representative to participate in the walkaround, including: • The union representative brings experience and skill, for example because of experience evaluating similar working conditions in a different plant. • Non-English speaking workers want a representative who is fluent in both their own language and English. • Workers may feel uncomfortable talking to an OSHA [inspector] without the trusted presence of a representative of their choosing. The memorandum did not illustrate any situations in which union representatives would not make a positive contribution to a 72 | Ethanol Producer Magazine | JULY 2017

more thorough and effective investigation. It also did not discuss the difficult subject of determining whether the union representative was authorized by the employees to serve as their representative. In practice, employees almost always disagree about whether they wish to be represented by a union. In another area of federal law, the National Labor Relations Board has an elaborate process and over 70 years of case law regarding how to determine employees’ wishes. Some commenters and employer groups decried the OSHA memorandum as nothing more than a gift to unions seeking access to employees they might seek to organize. That access could be especially valuable to a union when it is framed in the context of scrutinizing and commenting upon an employer’s safety practices and alleged safety conditions. In practice, OSHA walkarounds can result in the employer taking corrective action. Even if the walkaround would have had the same result without the union representative present, a union might use its involvement as a step in an organizing effort. The NFIB sued OSHA, claiming that: • The guidance unlawfully evaded the Administrative Procedure Act’s requirements that an agency give the public notice and the opportunity to comment on such a change. • OSHA exceeded the authority Congress had granted it. The U.S. District Court for the Northern District of Texas dismissed the second claim in an opinion issued Feb. 3. Despite its partial preliminary victory (and following the postelection change in administration), OSHA stopped trying to defend the memorandum. On April 27, the NFIB voluntarily dismissed its complaint, announcing to the court that OSHA had formally rescinded its 2013 memorandum. Even though OSHA’s 2013 memorandum has been rescinded, this development should serve as a reminder to employers that a union might see alleged OSHA violations as a means of trying to secure a foothold in an employer facility. Because employee concerns about OSHA can become both a reason and vehicle for union organizing, employers must have a plan for directing OSHA-type complaints into the proper channels, and a plan to view such complaints from both safety and labor-relations angles. Author: Ryan Funk Associate, Faegre Baker Daniels 317-237-1131 Contributing Author: Greg Dale Partner, Faegre Baker Daniels

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2017 July Ethanol Producer Magazine  

Sustainability Issue Plus: Plant and Yield Optimization

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