Cellulose Goes Global

Cellulosic ethanol is gaining momentum worldwide as more and more governments and international companies begin to see the renewable fuel as the next inevitable step toward reducing fossil fuel consumption. This new technology has a bright future, but when—and where—will it develop first?
By Kory Wallen | March 01, 2006
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Consequent to President George W. Bush's buzz-inciting plug for ethanol produced from "stalks, wood chips" and "switchgrass," the Energy Policy Act of 2005 and its renewable fuels standard (RFS) just might become a global poster child for cellulose-to-ethanol legislation. The cellulosic provisions within the bill are trailblazing—the first of their kind put forward by any nation—and the stuff of truly gutsy, forward-thinking policymaking.

Aside from a few pilot-scale projects, that's where America's cellulosic ethanol bragging rights stop, though, and if key provisions of the energy bill are not fully funded and administered soon, some industry experts say Europe or Asia could steal America's biomass thunder. Various companies across the globe are simultaneously developing process technologies to make cellulose-to-ethanol commercially viable.

Canada-based Iogen Corp., perhaps the world's cellulosic ethanol frontrunner, and Spanish-based Abengoa, the largest ethanol producer in Europe and one of the largest in the world, are leading the global cellulosic charge with pilot- and demonstration-scale plants. Iogen built and operates the world's first demonstration-scale facility that converts biomass to cellulosic ethanol using proprietary technology. The process used at the facility, located in Ottawa, Ontario, is the culmination of 25 years of research and development funded by Iogen, private industry partners like Shell Oil Co. and the Canadian government. The plant uses wheat, oat and barley straw as feedstocks to produce as much as 1 MMgy (4 MMly) of cellulosic ethanol.

Iogen recently announced a major joint study with Shell and German-based Volkswagen AG to determine the feasibility of building a cellulosic ethanol plant in Germany. "Volkswagen looked around to see who they should collaborate with on this study," says Jeff Passmore, Iogen's executive vice president. "The fact that they chose Iogen shows we're a world leader in the field."

This joint venture has given Iogen a vote of confidence in its cellulosic technology and shows it is not only serious, but ready for commercialization. "Here is an automotive company that has said, ‘Look, we are going to have to figure out how to reduce our greenhouse gas emissions in the transport sector, and we think there should be an integration between fuels and vehicles to come up with the right solution,'" Passmore says, echoing a recent statement from Volkwagen CEO Bernd Pischetsrieder who has repeatedly declared the company's commitment to reducing the world's dependence on fossil fuels. The venture puts Germany back on the front burner and heightens Europe's interest in Iogen's cellulosic ethanol technology. The group hopes to have the feasibility study completed sometime this year, but no timetable has been released.

Iogen and Volkswagen believe the pressure to reduce emissions shouldn't be solely placed on the shoulders of automakers. "In some cases, there will be certain things you can do with a vehicle that will be more cost effective than cellulosic ethanol to reduce greenhouse emissions," Passmore says. "But cellulosic ethanol is the most cost-effective way to reduce carbon dioxide emissions today."

The investment of both Volkswagen and Abengoa in developing cellulosic ethanol stems from the European Union's objectives for reducing greenhouse gases to comply with the Kyoto Protocol. "The Kyoto Protocol is being taken very serious in Europe," says Javier Salgado, president and CEO of Abengoa. The Kyoto Protocol is an agreement under which industrialized countries will reduce their collective emissions of greenhouse gases by 5.2 percent compared to levels in 1990. A total of 156 countries have ratified the protocol, negotiated over eight years ago in Kyoto, Japan. "The reason why Europe is trying to get its emissions down is all Kyoto driven," Passmore says. "The problem is that emissions have come down in every sector of the economy in Europe except transport, where they are skyrocketing."

Abengoa currently has two pilot-scale cellulose-to-ethanol plants under construction. "We need to change the way we produce ethanol," Salgado says. Each plant is testing different technologies for extracting the lignocellulose from wheat straw. Abengoa's first plant is located in Salamanca, Spain, and will produce over 1 MMgy of cellulosic ethanol. "The ultimate objective of this plant is to develop cellulosic ethanol technologies that are economically competitive with gasoline," says Gerson Santos-Leon, research and development general for Abengoa. The plant will be integrated with a starch plant and use Toronto-based SunOpta's steam explosion process for cellulosic extraction. The company's second pilot cellulosic plant is located in York, Nebraska. The plant, also collocated with a grain-based ethanol facility, will test a fractionation process for breaking down biomass into ethanol. Both of Abengoa's plants are scheduled to start production by the end of the year.

How far out is the commercialization of cellulosic ethanol? If you would have asked that question to anyone 10 years ago, the answer—almost invariably—would have been "five years." That same question today gets the same response, "cellulosic ethanol will be viable in five years."

This time, however, they might be right.

As motivation in developing cellulosic technologies grows—and as the U.S. energy bill's provisions are rolled out—Iogen and Abengoa see the commercialization of cellulosic ethanol developing in this decade. Passmore believes the support for cellulosic ethanol is being provided by three factors. First, it provides a new source of income for farmers. "This is a great opportunity for farmers to sell their residue and put more money in their pockets," he tells EPM. Second, the alternative fuel has been proven to reduce greenhouse gas emissions. Third, cellulosic ethanol provides greater energy security for nations currently relying on foreign sources of oil. "Depending on what country you're in, these factors will vary in importance," Passmore says. "The U.S. will be interested in energy security, Canada will be interested in adding value to crops [and meeting the Kyoto Protocol], while Europe will see all three with equal importance."

Leading candidate countries where cellulosic ethanol will most likely develop first are Canada, Germany and the United States. Though versatile, the site selection for these plants still must follow some criteria to be economically feasible. Companies will have to look at feedstocks, government policy, infrastructure issues and ethanol markets before selecting a plant site.

When Abengoa and Iogen selected sites for their respective pilot- and demonstration-scale plants, feedstock considerations were of critical priority. The type, availability, cost and ease of collection are just some of the factors a developer must consider. In the United States, corn stover is perhaps the front-runner among near-term potential cellulosic feedstocks. "Corn stover is readily available and can have a low cost under the right conditions," Bob Perlack of Oak Ridge National Laboratory says. "But there are some issues in collecting it from the field." In Canada and Germany, wheat straw is rather bountiful and will most likely be the first feedstock developed into cellulosic ethanol. There are substantial quantities of wheat straw available in the Canadian providences of Manitoba, Saskatchewan and Alberta. If one-third of the annual crop was used to make cellulosic ethanol, it could replace 10 percent of the nation's gasoline usage. "We (Iogen) have been looking at Germany for a number of years, and we know there is a lot of wheat straw there, so feedstock isn't an issue there," Passmore says about the feasibility study going on with Volkswagen. Abengoa's pilot plant in Spain will also be using wheat straw, although the company has noted that today's equipment doesn't collect the biomass efficiently. "Some people are talking about "single-pass" technology where grain and biomass will be collected at the same time," Santos-Leon says. "I think that technology will be available within 10 years."

Another feedstock that will be closely looked at around the world will be switchgrass, a so-called dedicated energy crop. "Switchgrass has high yields per acre, up to 10 tons per acre," Perlack says. "Compared to corn yields of two tons per acre, switchgrass looks to be a good feedstock for cellulosic ethanol." The only disadvantage switchgrass has is the fact that it would take two growing seasons before it could be harvested. After the initial growing time, switchgrass can be harvested annually up to 10 years before replanting, Perlack adds.

The third viable crop for cellulose-to-ethanol production will be woody crops. Some cellulosic plant will utilize waste residues from sawmills, paper and pulp mills, and forestry waste. Planting fast-growing poplar and willow trees that can be harvested every six to 10 years may also prove to be economical, Perlack says. "The only downfall for woody feedstocks is that the technology is a little behind the rest of cellulosic technology," Perlack says.

The aggressive cellulosic provisions in the RFS have shown other countries that governmental support is going to be vital in creating any kind of cellulosic program. "Companies are going to need extensive support from state and federal governments," Salgado says. Both Abengoa and Iogen see the United States RFS being used as a model to develop legislation in other countries. "Germany recognizes, as the Americans do, that there is an issue about the commercialization of new technology without support from the government," Passmore says. "Using loan guarantees as an economic instrument to commercialize cellulosic ethanol is the key provision in the RFS that other countries will have to follow."

Salgado adds, "We estimate that $4 billion to $5 billion dollars are going to be invested in cellulosic plants in the next few years. That's why loan guarantees and other financial incentives will be important to establish."

In Europe, there is talk about getting a bill passed that would require 20 percent of gasoline and diesel be comprised of renewable fuel by 2020. "There are going to be huge advances in legislation the next few years in Europe," Salgado says.

Iogen and Abengoa are among the most well known companies with big stakes in cellulosic ethanol, but there are other international entities that are continuing to research and develop new technologies. A group of researchers at Kyoto University, for example, are working on extracting cellulose from wood through fluid technologies. Likewise, professor Claus Felby at the Danish Royal Veterinary and Agriculture University in Denmark has discovered a new and simple method of mixing biomass with enzymes that requires less water than existing methods. The professor is currently testing the new process in a test plant and has applied for a patent for the energy- and cost-saving process. Industry experts say these and other developments taking place worldwide should send a clear message to companies in the United States: Cellulosic ethanol is an emerging global phenomenon.

Kory Wallen is an Ethanol Producer Magazine staff writer. Reach him at [email protected] or (701) 746-8385.