Driving Ethanol's Digital Transformation

For ethanol producers, everyday business is now all but paperless. From mobile apps to cloud-based data storage, the smart plants of the future are here. Even in this challenging time, adoption of new technologies focused on efficiency carries on.
By Susanne Retka Schill | June 10, 2020

Ethanol producers are no strangers to computers and automation. Distributed control systems (DCS) have been in use for decades to monitor and control fermentation and distillation. Indeed, the needs of the ethanol industry drove innovation in computerized truck receiving and weighing to speed up truck handling, says Tim Ciucci, vice president of sales and marketing at CompuWeigh.

The SmartTruck system, deployed at more than three dozen plants now, uses a cab-level terminal at the truck scale, outfitted with a touch screen, scanner and printer, so drivers never have to leave the cab. “Truckers use an outdoor SmartTouch terminal to enter their load number and answer the FSMA declaration questions,” Ciucci says. The system takes a photo of the driver for better traceability under the requirements of the Food Safety Modernization Act. All of the documentation required for accounting and regulatory purposes for each load is digital, reducing operator errors not only in the scale room, but in the back office accounting department as well.

Ethanol producers are now taking the system’s capabilities to the next level, Ciucci says. In addition to using RFID (radio frequency identification) cards to speed up paperwork processing, plants are recording RFID data at every point through the dumping or loading process, analyzing the time stamps to identify bottlenecks. “In the past, managers would make decisions based on their gut reactions on where the bottlenecks were,” he explains. “But once you can put metrics into it, they can see where the bottlenecks are, and if they should invest in a second scale or another dump pit.”

The increasing computerization and sophistication of truck receiving is just one example of the digital transformation spreading across the industry. Widely occurring in all sectors, the movement has several names, says Bruce Lichty, management systems lead for Christianson PLLP: The Internet of Things, Industry 4.0 or the 4th Industrial Revolution—the 1st being the machine age beginning in the 17th century, the 2nd the assembly line in the 20th century and the 3rd the introduction of computers a half century ago. 

The ethanol industry has experienced the first steps of many of the transformations to come, Lichty says. “Almost all our ethanol clients have several types of presence on the internet. They have a web portal that provides business information to their growers and customers about contracts and deliveries.” Increasingly, that information is accessible on mobile devices, and in recent years, producers are taking it up a notch. “We have clients that use a bid/offer system on the web, where if there’s a striking price on a bid and offer, it generates a contract automatically.” 

Subscription Power
Digital innovations also are changing the underlying hardware and software at plants, Lichty says. In the past year, two clients, both managing multiple ethanol plants, have moved their data storage to the cloud rather than replacing their in-house servers.

Not only are servers being replaced with cloud storage, software applications are moving to cloud-based subscription services. The benefit for businesses, Lichty says, will be in converting large capital investments into monthly fees. “Rather than purchasing an application and hardware to run it on, and purchasing a large data server farm, it will be more of a subscription service.” Plants will pay for the speed and bandwidth they need for storage in the cloud and they will subscribe to the business applications they use, adding modules as needed.

The move to cloud-based services also transfers upgrade and service requirements onto the provider, promising to keep applications up to date. For an ethanol producer, that will also reduce the hours needed to maintain an in-house system and free a person up for other tasks. For service providers such as Christianson, which offers accounting and management software, updates and changes will be done to a central application in the cloud rather than by performing separate revisions at individual clients’ workspaces.

For many, the digital transformation taking hold now is about moving information—invoices, orders, meter readings, documents— electronically, machine to machine, Lichty says. Nothing gets printed on paper nor manually entered into a spreadsheet. “Our customers love it, it saves time and accuracy. But it’s just the beginning.”

As more suppliers and buyers adopt new systems, Lichty says, it will require careful thought and planning. “It will be like playing catch. You can’t play alone, you need somebody else to catch the ball and throw it back.” The planning involves learning what everyone along the value chain is planning for future upgrades, he says, so plant managers make the right investments in new technology—with the goal being to increase productivity, improve accuracy and lower costs.

“You need to bring in a third-party advisor, so you don’t overlook something,” he adds, “a trusted advisor who attends your planning meetings to understand the thinking at your plant. Then, when everyone goes off to their daily operations, that advisor goes off to research and bring in the information required for the next steps.” These will be long-term planning sessions, Lichty says. “These revolutions last for a long time. You just want to be sure you’re equal to or greater than the competition, so you’re not put at a disadvantage because you’re left in the dust.”

Following trends to anticipate clients’ needs four or five years ahead has been Lichty’s role for years as a business software developer. He expects several trends to continue:

• Unmanned collection of data that is automatically processed and shared up and down the value chain—from the supplier or vendor to the end customer, and even the customer’s customers.

• 5G connectivity that enables greater processing capability in cellphones and tablets, making them more useful at greater distances from the plant office or control room.

• Robotics, smart sensors, artificial intelligence and machine learning finding new applications throughout the plant.

• Augmented reality for training, where new hires don smart glasses that immerse them in simulations, performing functions as they learn through virtual reality.

“All these pieces are slowly rolling out,” Lichty says. The challenge for individual companies will be to understand where their business partners are heading and developing a strategy to have the systems in place, so their companies are ready for the next innovative technology. 

Macro Opportunities
“I think there are going to be micro things the digital technology enables, such as better sensors to provide more data to make better decisions,” says Steele Lorenz, head of sustainable business with the Farmers Business Network. “But I think there also will be macro opportunities that can now be chased for the first time.”

One pilot project Lorenz has worked on with an ethanol producer taps into new digital technologies to collect farm-level data to plug into the GREET model to determine carbon intensity (CI). Currently, the Greenhouse Gases, Regulated Emissions and Energy Use in Transportation model uses national averages for yield and inputs such as fuel, fertilizer and pesticides to calculate corn ethanol’s upstream emissions from feedstock production. Developed by U.S. DOE’s Argonne National Laboratory, the GREET model is used by California and other states that have adopted low-carbon fuel standards.

“The point is to build the case that the CI score being claimed is accurate without boots on the ground, using everything from satellite imaging and weather data to receipts and the precision agriculture information collected by the equipment used,” Lorenz says. While the indicators available to farmers of what happened in the field are good, Lorenz adds, “they are probably not enough to build the kind of confidence the market would need to accept that CI rating.” The weather and satellite data are used to confirm a yield claim and artificial intelligence is used to spot errors and potential fraud.

The goal is to make it feasible for an ethanol producer to economically gather information from as many as 1,000 corn suppliers and claim lower-than-average farm-level greenhouse gas emissions, thus reducing the plant’s carbon intensity score. Such a program could also enable awarding carbon credits to farmers who lower their carbon intensity through conservation tillage or best fertilizer practices—a recommendation made in the recent white paper, A Clean Fuels Policy for the Midwest.

“We think market forces are going to be extremely important here, especially given what is facing the biofuel industry as a whole right now,” Lorenz adds, referring to the collapse of the oil market and COVID-19 demand destruction. In the near term, the adoption of new digital technologies is likely to focus on increasing efficiency and reducing costs, he says, but if markets or policies shift, “we could see rapid change.”

The challenge in difficult times is deciding just what steps should be taken to be ready for the future, Lorenz adds. “The folks who figure out how to make smart investments in new technology may have the advantage coming out of this.”

Author: Susanne Retka Schill
Freelance Journalist