How Big is Commercial Scale?

How big is a commercial-scale cellulosic ethanol plant, and will we know it when we see it?
By Ron Kotrba | January 10, 2008
Through the efforts of pure science, ethanol can be made a million different ways. Add the economic and efficiency constraints of the real world, however, and many of the more eccentric approaches fall by the wayside without significant, expensive advances. "And you're really talking about labs and toys and it's fun to experiment and it's fun to try these things at universities and maybe some companies are going to try them in their backyard," says the proud chief executive officer of Range Fuels Inc., which broke ground on its modular 20 MMgy thermochemical wood-to-ethanol refinery in November. The CEO's name is Mitch Mandich, and while his words out of context read like the ravings of a madman, they make perfect sense when properly framed. Mandich is talking about how the race to "be the first" has triggered the onset of frenzied discoveries and with it, overstated claims about novel and perhaps idealistic approaches to commercializing ethanol production from cellulose. He is not uninvolved in this race. In fact, Mandich like all the others is declaring himself the winner. "We asserted we would be the first in February 2007, when we were putting together our plant project, and again when we were one of the recipients of the [U.S.] DOE grant, and we asserted it again in front of colleagues, and then during our November groundbreaking we asserted it again," he says, tongue in cheek. Whether Range Fuels will be the first operating commercial-scale cellulose plant, who knows? Maybe.

Range Fuels and six other demonstration projects gained their legitimacy in the public's eye upon receiving news of their large DOE grant awards. Joining Range Fuels in this upper echelon of the cellulose cast is Abengoa Bioenergy Biomass of Kansas LLC, Alico Inc., BlueFire Ethanol Inc., Poet LLC and Iogen Biorefinery Partners LLC. The diversity of technologies represented in those six projects is great, but will they all pan out? They each displayed their respective "states of readiness" for the DOE. As for the projects that didn't receive DOE funding, can they build small and still be successful? There is a huge discrepancy between a beaker full of alcohol retrieved through some obscure process and producing 100 million gallons a year and turning a profit. Some technologies and approaches—and certainly feedstock choices—are fated to encounter problems during scale up.

Verenium Corp. formed in 2007 when enzyme company Diversa Corp. merged with Celunol Corp. (formerly BC International), taking on the new name to signify the green millennium. It lays claim to having broken ground on the first demonstration-scale cellulosic ethanol plant in the United States, sized at 1.4 MMgy. The company's chief executive officer, Carlos Riva, spoke at Infocast's Cellulosic Ethanol Summit in Washington, D.C., this fall, and said Verenium's plans to implement a 20-fold scale-up from the demonstration plant would encounter feedstock procurement issues using only bagasse from U.S. sugar mills. This is why specialty bred energy cane is planned to supplement the relatively limited availability of U.S. produced bagasse. The 1.4 MMgy demonstration plant will be complete in early 2008. Verenium is a public company and although it wasn't one of the six DOE grant recipients, its encompassing approach seems promising.

The energy department defines the ability to demonstrate commercially producible ethanol from cellulose if the process consumes 700 tons of biomass a day. Interestingly, there is no gallons-per-ton of ethanol stipulation. Mandich wouldn't disclose the gallons-per-ton ratio his plant achieves, saying, "We don't talk about that because, well, that's the Holy Grail, right? You've got the enzymatic guys going after this, and the acid hydrolysis guys, and we think we have a far superior approach but if you start getting into gallons per ton, all you're doing is giving away your secrets." An unconfirmed source claims Range Fuels can get 65 gallons of ethanol per ton, which, when multiplied by 700 tons per day, 365 days a year, comes to an unofficial tally of 16.5 MMgy. "I've talked with a number of constituents across the industry and if you can't get something to 10 MMgy, then it's just not commercial scale at all," Mandich says. "And even that is probably small for some processes."

Depending on the feedstock, the economic livelihood of a plant is constrained by its size—or vice versa. Some have it better than others. Poet, for example, was innovative enough to devise the fractionation of corn and use the fiber that's already there to supplement additional incoming corncobs, a dense and practical feedstock for delivery to its Emmetsburg, Iowa, dry-mill plant under conversion for its cellulosic ethanol development project. Conversely, if a company is looking at straws, stover or soybean stubble, this could equate to the collection of residues from millions of acres of land, for one large plant. Yields and hauling distances are important. But Mandich says, "In the end, it will be constrained by the productivity of the technology. If you can get more gallons per ton you can build a bigger plant with less of a geographic footprint." Ultimately, there are practical limits to how big most biomass refineries can be, but clearly on the other end there are issues with size (i.e. productive capacity) and how small a plant could get and still be considered a player in the commercial arena, right? But small plants cannot capture economies of scale, unless of course they are integrated into existing facilities, as some of the leading grant winners and self-starters are doing. EPM's sister publication, Biodiesel Magazine, classifies biodiesel plants producing at least 1 MMgy as commercial-scale and therefore creditable for placement on its popular proposed plant map printed twice a year. If biodiesel plants at 1 MMgy are commercial-scale but "demo" ethanol plants like the Jennings, La., plant aren't, how does this wash?

At the Cellulosic Ethanol Summit an audience member stood up during a question and answer session and somewhat admonished the experts in attendance for not recognizing that six alcohol plants using cellulose as feedstock are operational around the world today. There must be constraints on the bottom side of the size argument if six or more cellulosic pilot or demonstration plants are not classified as commercial. After the audience member's remark there was silence—no one responded. A key showman at the event, Auburn University Professor David Bransby, later retorted that the aforementioned plants were pilot and demonstration scale. "Shouldn't the decision on whether a cellulosic ethanol plant is commercial or not depend on whether it makes money?" Bransby asked. "Shouldn't it matter whether or not it can turn a profit? Can't small plants make money?" One potential factor limiting the profitability of small enzymatic hydrolysis conversion plants is the high transportation costs to deliver these enzyme cocktails, which at this stage of development require lots of water to remain useable.

While much of this exercise was done in fun, it's clear that confusion exists concerning what elements are needed for individual plants small and large to meet the threshold of commercialization. If cookie-cutter designs such as those used in the corn-ethanol industry are held in mind, then experts say forget it. So what is a commercial-scale cellulosic ethanol plant? Sure, it's one that can process at least 700 tons of biomass a day as the government defines it, or a minimum of 10 MMgy as Mandich says. In the end, it comes down to having a reproducible and robust conversion process; a long-term feedstock arrangement and the ability to efficiently get the material into the plant; access to abundant capital; keeping costs below sales; and at this point government subsidies. EP

Ron Kotrba is an Ethanol Producer Magazine senior writer. Reach him at [email protected] or (701) 738-4962.