August 2010 Ethanol Producer Magazine

AUGUST 2010

INSIDE: VILSACK BACKS ETHANOL VISION

WWW.ETHANOLPRODUCER.COM

2010FEW Review

Upbeat Mood in St. LouisPermeates Ethanol Showcase

EP

MA

ugust 2010

Enhancing biofuel design since 1977.

Finding the right alternative energy source can be challenging. It takes more than a one-size-fits-all, Band-Aid approach. Burns & McDonnell — with more than

30 years of biofuels experience — will engineer the right energy-efficient, sustainable solution for your facility with the follow-through and support you need.

E n g i n e e r i n g , A r c h i t e c t u r e , C o n s t r u c t i o n , E n v i r o n m e n t a l a n d C o n s u l t i n g S o l u t i o n s

For more information:Ron [email protected]

Comprehensive Services

Ethanol? Gas-to-Liquid? Biodiesel?

Need refueling? Build it better with Burns & McDonnell.

ETHANOL PRODUCER MAGAZINE August 2010 4

68

vol. 16 no. 8

46 EVENT 2010 FEW Review: An Upbeat St. Louis Hearing project updates and learning more about new technologies were highlights of the 26th International Fuel Ethanol Workshop & Expo.–By Holly Jessen, Luke Geiver, Susanne Retka Schill and Ron Kotrba

60 PROFILEAn Iowa Ethanol Booster in Washington Secretary of Agriculture Vilsack talks about the power of ethanol to boost rural economies.–By Holly Jessen

68 CANADA O’ Ethanol EPM takes a look at Canada’s industry as its national E5 mandate is about to take eff ect.–By Anna Austin

76 PROMOTIONThe New Face of Ethanol Current events and advertising campaigns provide an opportunity for ethanol to build a new image.–By Luke Geiver

82 WASTE-TO-ETHANOLHogwash Hog manure is being examined from two angles—using the cellulosic fraction for ethanol production and recycling waste water for ethanol.–By Holly Jessen

features

contents

Clarifi cations and Corrections: In the “Healthy Living: DDG’s New Function” feature in the June issue, sources point out that AgraMarke Quality Grains owns a 51 percent interest in Lifeline Foods LLC while ICM Inc. owns 49 percent. In the “Beating Bankruptcy” feature in the July issue, White Energy has not emerged from bankruptcy as of yet as stated, although it has resumed production and is working through the details to complete its reorganization plan.

Ethanol Producer Magazine: (USPS No. 023-974) August 2010, Vol. 16, Issue 8. Ethanol Producer Magazine is published monthly. Principal Of-fi ce: 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. Periodicals Postage Paid at Grand Forks, North Dakota and additional mailing offi ces. POSTMASTER: Send address changes to Ethanol Producer Magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, North Dakota 58203.

8 Editor’s Note The Aesthetics of Brewing By Susanne Retka Schill

9 Advertiser Index

10 Events Calendar

14 The Way I See It Resilience in the Face of Opposition By Mike Bryan

16 View From the Hill Weird Science By Bob Dinneen

18 Drive Ethanol: The Ever-Cleaner Alternative By Tom Buis

20 eBio Tell Me: What is Residue? By Rob Vierhoust

22 Taking Stalk The Potential for Sweet Sorghum Biofuels By Bill Greving

24 Business Matters Grandfathered Status in Healthcare Reform By Alice Eastman Helle

26 Business & People

30 Commodities

32 BIObytes

36 Industry News

110 Marketplace

departments

contents

6

contributions

88

92

96

88 SAFETY Creating, Auditing Equipment-Specifi c Lockout/Tagout Instructions Proper safety procedures guard against injuries from the silent danger posed by hazardous energy.–By David Ayers

92 DISTILLERS GRAINS DDGS, WDGS, Modifi ed—Which Makes More Money Today?Factors vary, but good modeling can help in making wet-to-dry ratio production decisions. –By Michael Tay

96 BOARD MANAGEMENT FEW Features Board Management StrategiesGiven current industry challenges, boards of directors must understand their responsibilities and potential liabilities.–By David A. Crass and Anna J. Wildeman

ETHANOL PRODUCER MAGAZINE August 2010

Let Novozymes

show you a

winning strategy

HIT THE JACKPOTIN ETHANOL PRODUCTION

Why take a

chance with lower

performance?

More ethanol means more profi t. Our new Spirizyme® Excel converts more starch than ever and can take your ethanol production to new heights. Designed to give consistent performance across variable mash conditions and production processes, this robust enzyme enables you to get the most from your corn.

Partner with us to stay ahead of the competition. As the industry leader in experience and expertise, we’re committed to providing you with advanced technologies and the customized support to make them work for you.Find out more at www.bioenergy.novozymes.com


The Aesthetics of Brewing

he International Fuel Ethanol Workshop & Expo in St. Louis was upbeat, with great speakers as always. You’ll read all about it in this issue. After taking in the special event

Wednesday night at St. Louis Anheuser Busch brew-ery, I want to tease our ethanol producer readers out there a little bit. You guys have to seriously spruce up your act. If it weren’t for a few steel columns poking up, there was barely a hint that AB (as I understand the locals affectionately call the century old institu-tion) is a brewery with its brick-walled buildings and manicured landscaping complete with fl ower gardens. Only once on the tour did we catch a tiny whiff of grain and beer smell.

Yes, AB is a showcase, hosting thousands of tour-ists each year (2,800 a day at the peak). There must be a tradition of well-appointed breweries, though. The family-held, 100-year-old Schell’s Brewery in New Ulm, Minn., also has wonderful old buildings with character and lovely landscaping to accommodate tourists at the functioning brewery. There may be a lesson here for ethanol producers. The following let-ter, sent via email and published here as is (spelling, capitalization and all), comes from an unhappy etha-nol plant neighbor:

i live a few blocks from your plant, and i can not for the life of understand why you were given the ok, to build where you did. the smell is unreal, the dust from the chemicals that lays in my house, car and lungs

is so bad that i now have more breathing problems, than i have ever had in my 57 years of life. But will you do anything about it or even let your neighbors know, heavens no, then that would that you would have to admit to doing something wrong. that like health and well being of others. you should have to pay all of us in eastend for having ruin our lives. sincerly, lks

We all have dealt with cranky neighbors who can’t be placated, but perhaps the long tradition of landscaped breweries arose for a reason. In the days before thermal oxidizers, nice buildings and landscap-ing would help a community take pride in the local brewery. Ethanol plants today are more like industrial sites, and I know from my tours of a handful of ethanol plants that great pains are taken to keep the buildings clean and expensive technologies maintained to mini-mize odors. Yet many plants are built on the edge of town. Would a bit of attention to aesthetics, in addition to cleanliness and good pollution control, pay off in community good will?

Susanne Retka Schill, [email protected]

few points regarding your July article “Etha-nol to Drink:”

You calculate that 2.8 per cent of all the ethanol produced in the U.S. is potable high-

grade. Therefore, only 2.8 percent of the existing fuel ethanol capacity could convert to high-grade. This would assume, of course, that the new high-grade plants capture all the business from existing suppliers. Also, the fl avor of high-grade ethanol is not a minor issue as each buyer has very specifi c demands. Look-ing at a market from the outside through rose colored glasses is fun, but may not lead to profi ts.

The American fuel ethanol industry has destroyed the distillers grains market by over producing over-

dried DDG’s with high sulfur and antibiotic content. Inconsistent quality has resulted in a product of ques-tionable value to cattle feeders. The American fuel eth-anol industry has also undermined the price of ethanol through unfettered new construction of poorly planned plants resulting in excess capacity. Converting those plants to over produce high-grade ethanol, as your story suggests, would only make the production of high-grade ethanol unprofi table as well.

Kind Regards,

Peter Sandfort, Business Development Manager

KATZEN International Inc

T

A

Susanne Retka Schill Editor's Note

letter to the editor

w w w . E t h a n o l P r o d u c e r . c o m

P U B L I S H I N G & S A L E S

Mike Bryan

Joe Bryan

Tom Bryan

Matthew Spoor

Howard Brockhouse

Jeremy Hanson

Marty Steen

Bob Brown

Gary Shields

Jessica Beaudry

Jason Smith

Marla DeFoe

[email protected]

[email protected]

Vice President [email protected]

Vice President, Sales & [email protected]

Executive Account [email protected]

Senior Account Manager [email protected]

Account Manager [email protected]

Account [email protected]

Account [email protected]

Subscriptions [email protected]

Subscriber Acquisition [email protected]

Advertising [email protected]

A R T

Jaci Satterlund

Sam Melquist

Elizabeth Burslie

Art [email protected]

Graphic [email protected]

Graphic [email protected]

E D I T O R I A L

Susanne Retka Schill

Holly Jessen

Luke Geiver

Jan Tellmann

[email protected]

Associate [email protected]

Associate [email protected]

Copy [email protected]

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

Select back issues are available for $3.95 each, plus shipping. To place an order, contact Subscriptions at (701) 746-8385 or [email protected]. Article reprints are also available for a fee.

For advertising rates and our editorial calendar, visit www.EthanolProducer.com or call (866) 746-8385.

We welcome letters to the editor. Send your letter to: Ethanol Producer Magazine Letters, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203 or e-mail to [email protected]. Letters should include the writer’s full name, address and telephone number, and may be edited for purposes of clarity and space.

SUBSCRIPTIONS

BACK ISSUES AND REPRINTS

ADVERTISING

LETTERS TO THE EDITOR

Please send correspondence to:Ethanol Producer Magazine308 Second Ave. N., Suite 304Grand Forks, ND USA 58203Phone: (701) 746-8385Fax: (701) 738-4927

Advertising information online:www.EthanolProducer.com

2010 Southeast BIOMASS Conference & Expo

2011 International Fuel Ethanol Workshop & Expo

2011 Pacifi c West BIOMASS Conference & Expo

Agra Industries Inc.

Anhydro Inc.

ATEC Steel

BetaTec Hop Products

BinMaster Level Controls

Biomass Magazine

BrownWinick Law Firm

Buckman Laboratories Inc.

Burns & McDonnell

Cereal Process Technologies

Check-All Valve Mfg. Co.

Church & Dwight Co. Inc.

Cloud/Sellers Cleaning Systems

CPM Roskamp Champion

Crown Iron Works Co.

EISENMANN Corp.

Fagen Inc.

FCStone, LLC

Ferm Solutions Inc.

Fermentis - Division of S.I. Lesaffre

Freez-it-Cleen

Gamajet Cleaning Systems Inc.

Gavilon

Genencor® - A Danisco Division

Gevo Inc.

Growth Energy

HEMCO Industries

HPD

Hydro-Klean Inc.

ICM, Inc.

Inbicon

Indeck Power Equipment Co.

Interstates Companies

Intersystems

Lallemand Ethanol Technology

Lindquist & Vennum PLLP

Marcus Construction Co.

Martrex Inc.

McC Inc.

Mist Chemical & Supply Co.

Nalco Co.

Natwick Associates Appraisal Services

North American Bioproducts Corp.

Novozymes

Phibro Ethanol Performance Group

Pioneer Hi-Bred International Inc.

Premium Plant Services Inc.

Pro-Environmental, Inc.

Renewable Fuels Association

Rev Tech LC

RSM McGladrey Inc.

SSEA Sweet Sorghum Ethanol Association

Tranter Phe

U.S. Tsubaki

Verenium

Victory Energy Operations, LLC

Vogelbusch USA, Inc.

Wabash Power Equipment Co.

WINBCO

75 & 105

74

106

62

3

78

51

85

104

45

44

2

86

84

65

73

63 & 87

50

89 & 97

25

48

39

11

91

90

94

15 & 21

19

108

95

29

49

5

12 & 13

42

52

98

34

53

40

54

64

55

72

80

107

7

17

23

66

93

59

41

99

70

35

79

67

71

38

81

43

AdIndex

COPYRIGHT © 2010 by BBI InternationalETHANOL PRODUCER MAGAZINE August 2010 9

E D I T O R I A L B O A R D

Mike Jerke

Jeremy Wilhelm

Mick Henderson

Keith Kor

Walter Wendland

Neal Jakel

Bert Farrish

Eric Mosebey

Steve Roe

Bernie Punt

Chippewa Valley Ethanol Co. LLLP

Cilion Inc.

Commonwealth Agri-Energy LLC

Corn Plus LLLP

Golden Grain Energy LLC

Illinois River Energy LLC

LifeLine Foods LLC

Lincolnland Agri-Energy LLC

Little Sioux Corn Processors LP

Siouxland Energy & Livestock Co-op


2010 International Fuel Ethanol Workshop & Expo

An Upbeat St. Louis The ethanol industry has toughed it out, things are looking better, and the mood was noticeably upbeat at the 26th annual FEW. A positive buzz permeated the event.

By Luke Geiver, Holly Jessen and Susanne Retka Schill


For three days, St. Louis America’s Center, site of the 2010 International Fuel Ethanol Workshop & Expo, was a noisy, busy place as more than 2,000 attendees from 46 states, the

District of Columbia and 25 nations, bustled between breakout sessions and the expo, learning about the lat-est developments in the ethanol industry from present-ers and exhibitors. “I think this conference is great in the sense that you can feel the good mood coming back to the industry,” said Poul Andersen, global director of Novozymes, following the ribbon cutting ceremony that kicked off the FEW. “Things are starting to come back and people are much more optimistic.”

International visitor Guillermo Parra Romero, with Paraguay ethanol producer Petropar, considers FEW to be the most important ethanol event of the year. Petropar owns the largest ethanol plant in Paraguay, producing 40 MMly (10.5 MMgy) of anhydrous ethanol. In all, the country produces 120 MMly of ethanol primarily from sugarcane, with 20 percent coming from corn. He comes to the FEW to network and learn about U.S. market trends and commercializa-tion, he said. “For me, it is important to get in contact with the American ethanol fuel industry.”

BBI International chairman Mike Bryan cited the FEW’s longevity and success as he introduced the leadership of Growth Energy who helped with the offi cial ribbon cutting ceremony that launched the 26th annual FEW confer-ence, reception and expo. Growth Ener-gy CEO Tom Buis seconded Bryan in his remarks. “This continues to grow. The in-dustry continues to grow. We reduce our dependence on foreign oil, we improve the environment and create jobs right here at home,” he said. Speaking later in the expo, Ret. Gen. Wesley Clark, co-chairman of Growth Energy, described the industry’s long-term out-look. “Great wars aren’t won in a single battle,” he said. “We are in this for the duration.” Clark outlined a theme that echoed throughout the conference, as speaker after speaker referred to the Gulf oil spill. “It’s about oil,” he said about the need for ethanol production and the rea-son behind America’s presence in Iraq and Afghanistan. “It’s about the money from oil.”

During the general session the following day, Bryan and Bob Dinneen, president and CEO of the Renew-able Fuels Association, amplifi ed the oil theme. “After all the saber rattling and desk pounding happening over this

Renewable Fuels GroupWest Des Moines, [email protected], ext. 3728

Environmental

FCStone EnvironmentalWest Des Moines, Iowa800.422.3087, ext. 3731


Guillermo Parra Romero Petrobar

oil spill is over, we will recover,” Bryan said. “What’s most important is to learn from this event. We need to maximize our domestic oil production and maxi-mize our alternative energy production, from all sources.” Delivering the keynote address, Dinneen told the audience that now is the time to break our dependence on foreign oil, adding, “Now, no one in

this room is naïve enough to believe that America is going to stop using oil today, tomor-row, or in the near future. But that should not deter us from aggressively proceeding with efforts to develop and deploy the wide range of ethanol technologies you in this room are developing.” Dinneen went on to summarize a num-ber of the policy initiatives and issues facing the ethanol industry.

With the industry facing new greenhouse gas (GHG) reduction targets in the re-newable fuels standard, the fi rst panel session of the event discussed corn ethanol’s im-proving carbon score. Steffen Mueller, research economist at the University of Illinois-Chicago, related the results of a survey of ethanol produc-ers showing marked improve-ment in effi ciency of ethanol yield, water use and power use over the past decade. Charles Hurburgh, professor of agri-cultural and biosystems engi-neering at Iowa State Univer-sity, noted that the expected corn yield improvement of 4 to 6 percent per year over the next decade will result in 350 to 500 million more bush-els of corn each year. There is plenty of corn to meet the needs of the various users, he said, and with the corn utiliza-

tion in traditional markets remaining rel-atively fl at, ethanol use of corn actually needs to expand to absorb the increase.

Pete Moss, vice president of mar-keting for Cereal Process Technologies, discussed some of the challenges that will be faced by grandfathered ethanol plants wanting to increase production levels. Every new gallon brought online

LEADERSHIP,

AT YOUR SERVICE!

24/7 Service

Dryer CleaningTank Cleaning

Bin Cleaning

Waste Transport/Disposal

Evaporator Tube Cleaning

Vacuum Services

Des Moines/Duluth

www.hydro-klean.com

Phone (515) 283-0500

R


John Gell, president of Gell Associates and director of GR Biofuels describes a proposed integrated project for New York in his presentation at the general session.

PH

OTO

: WH

ITN

EY

CU

RTI

S

after the passage of the 2007 Energy Se-curity and Independence Act that revised the renewable fuels standard must meet a 20 percent GHG reduction threshold if it is to receive a renewable identifi ca-tion number (RIN). To achieve that, etha-nol producers are going to have to select one or two of the technologies that sig-nifi cantly improve corn ethanol’s carbon footprint, such as fractionation, deoiling, combined heat and power (CHP), mem-brane separation, raw starch hydroly-

sis, and wet distillers grains. Raising the question of whether corn ethanol could ever reach a 50 percent GHG reduction and qualify as an advanced biofuel, Moss pointed out that EPA calculations show a dry grind, natural gas-powered plant that utilizes CHP, fractionation, membrane separation and raw starch hydrolysis for wet distillers grains would only make a 36 percent reduction in life-cycle GHG emis-sions. A dry grind biomass-powered plant utilizing the same technologies would

bump that number up to 46 percent, still short of the 50 percent goal. Moss suggested corn-ethanol plants that add fractionation and deoiling technologies should receive GHG credit for the ad-ditional coproducts. A modifi cation in the use of indirect land use impacts on GHG will ultimately be needed to im-prove corn ethanol’s GHG reduction score, although the biggest challenge is that EISA excluded corn-starch-based ethanol production from qualifying as an advanced biofuel.

The potential for industrial symbi-osis was covered in the second panel of the morning. Niels Henricksen, CEO of Denmark-based Inbicon, described the synergies achieved at Kalundborg, Denmark, where Inbicon’s demonstra-tion cellulosic ethanol plant came on-line in late 2009. Nine organizations at the industrial site have more than 30 agreements in place exchanging energy and recycling water and waste products among a power plant, oil re-

FRACTIONATION • EXTRACTION • OIL PROCESSING • BIODIESEL • CO2 EXTRACTION • PILOT PLANT

Additional offices in Argentina, Brazil, China, England, Honduras, India, Mexico, Russia and Ukraine.

CROWN IRON WORKS COMPANY2500 West County Road C • Roseville, MN 55113 • USA

Call today at 1.651.639.8900 or visit us online at www.crowniron.com

Adding Value to your Ethanol Process.

The Crown Fractionation system was designed to give the ethanol industrymeans to improve plant efficiency and provide more profitable co-products.

Crown Fractionation, Extraction and Oil Refining.

Crown's Extraction and Oil Refiningtechnologies convert the germ into premium products, animal feed and edible oil.


St. Louis Anheuser-Busch hosted a tour and networking reception following the close of the FEW educational sessions and expo. The following day included tours of Monsanto and the National Corn-to-Ethanol Research Cen-ter.

fi nery using lignin pellets and municipal solid waste for both cellulosic ethanol power and steam, according to Peter Ben-dorf, Integro Services Group.

In the panel presentations that fol-lowed the morning session, numerous other companies, technologies and re-search were covered in greater detail, chal-lenging FEW attendees to chose among one of fi ve concurrent tracks covering topics in production/operations, manage-ment/business, cellulosic ethanol, distill-

ers grains/coproducts, and energy/car-bon/environment. EP

Luke Geiver and Holly Jessen are associ-ate editors of Ethanol Producer Magazine. Reach Geiver at (701) 738-4944 or [email protected] and Jessen at (701) 738-4946 or [email protected]. Susanne Retka Schill is the editor of Etha-nol Producer Magazine. Reach her at (701) 738-4922 or [email protected].

fi nery, enzyme manufacturer, waste-water treatment facility, Inbicon and others. In the U.S., three projects are developing similar symbiotic relation-ships. Sandra Broekema, manager of business development for Great River Energy, described the existing syner-gies experienced by the co-location of Blue Flint Ethanol with the company’s western North Dakota Coal Creek Sta-tion power plant. GRE is now build-ing a 62-megawatt combined heat-and-power plant at Spiritwood, N.D., that will meet the steam requirements of the Cargill Malt plant next door and is seeking partners in a proposed 20 MMgy cellulosic ethanol plant.

John Gell described Genessee Re-gional Biofuels’ proposal to locate a 20 MMgy woody biomass-based cellulosic ethanol plant in the Eastman Business Park in Rochester, N.Y. In addition to water, power and steam, and good transportation logistics, the long-time chemical production site has “public support for development,” Gell said. A brownfi eld site at Alton, Ill., is being proposed as the location for an ethanol project involving a dry mill corn etha-nol plant using cutting edge technolo-gies integrated with an Inbicon biore-

With IsoStabTM naturally derived antimicrobial

Pump more profit per bushel…naturallyIsoStabTM is made from natural acids found in hops. It’s the naturally derived way to effectively control gram-positive bacteria in fermentation.

Eliminate antibiotics and harsh chemicals. Forget problems with resistant bacteria. Add value to your co-products with antibiotic-free DDGS. Plus, many have experienced yield increases using this naturally derived, thermally stable, pH tolerant antibiotic alternative.

Drive your plant to higher productivity with IsoStabTM. You’ll find your map to increased profits at: www.bthp.info

5185 MacArthur Blvd., Suite 300Washington, DC 20016-33441202-777-4827Fax: 202-777-4893


PH

OTO

: BB

I IN

TER

NAT

ION

AL,

SU

SA

NN

E R

ETK

A S

CH

ILL

“Is ethanol tapping too much water? ““Biofuels: The water problem” “Ethanol vs. water: Can both win?” “University report warns water con-

sumption for corn ethanol on the rise”When it comes to ethanol’s image and

water use issues, headlines matter, stressed Nandakishore Rajagopalan, associate direc-tor of the Illinois Sustainable Technology Center, in the FEW panel covering water issues. “We’ve all heard the negative propa-ganda about ethanol,” said Trevor Cassel, vice president and director of operations for Biodynamics Inc. “Just do a Google search and you’ll fi nd headline after head-line.” Rajagopalan and Cassel spoke during a panel titled “Wringing Water out of the Production Equation” as did Mike Mow-bray, marketing manager for U.S. Water Services, and Phil Bonneau from Ortman Ethanol Water Resources. Jon Cohen, vice president and technical director of H-O-H Water Technology, served as moderator.

Although there has been a 40 percent reduction in water use in the ethanol pro-duction process in the past 12 years, the typical ethanol plant still uses about three gallons of water to produce one gallon of ethanol, Cassel said, a gallon more wa-ter than used for gasoline production. As

several of the speakers pointed out, cutting back on water consumption or going to zero liquid discharge doesn’t exactly trans-

late into increased income. The yield in positive public opinion, however, just might make it worthwhile.

ELECTRICAL CONSTRUCTION • ELECTRICAL ENGINEERING • AUTOMATION • INSTRUMENTATION

1-800-827-1662 • www.interstates.com


Public Opinion Counts on Water

Corn ethanol's continuing progress to improve its environmental performance was featured in the open-ing general session panel pictured above as well as in many of the breakout panel sessions.

PH

OTO

: WH

ITN

EY

CU

RTI

S

In some cases, zero liquid discharge is the only way to comply with environmen-tal restrictions, which are getting stricter every year, Mowbray said. In addition, zero liquid discharge can result in a 20 to 30 percent decrease in water needs. There is no single design that works for every ethanol plant, he added. U.S. Water Ser-vices has four approaches: recycling water using cold lime softening, evaporation or crystallization of the discharge stream, and evaporation ponds, which only work in the Southwest. The method chosen must ensure that any water treatment chemicals used are acceptable to be sold as animal feed. “After all, that’s what you guys do, create ethanol and DDGs that are salable on the market,” he said. Mow-bray cited a retrofi t that reduced water us-age from about 3.5 gallons per gallon of ethanol, to 2.8 gallons with the addition of cold lime softening. Further conver-sion to zero liquid discharge decreased water use at the plant to just over 2 gal-lons of water per gallon of ethanol.

To grow the industry, Rajagopalan said, water usage at ethanol plants can and must be reduced through a number of methods. Water use could easily be reduced by 10 percent, or, with more

investment and work, by 25 percent, he said. “It depends how much you want to do and how aggressive you want to be.” One water reduction strategy is to focus on boiler water, which accounts for 12 percent of water use. Reusing fi lter water backwash can save about 4 million gallons of water a year in a 100 MMgy plant. The plant also could increase reverse osmosis recovery, with yearly potential savings of 17.6 million gallons of water. Minimizing cooling tower waste could save about 11 million gallons of water a year. In all, he said, there’s a potential to save approxi-mately 40 million gallons of water a year at a 100 MMgy plant.

Cassel talked about recycling thin stillage, resulting in valuable coproducts and energy savings. The average 50 MMgy ethanol plant yields 350 gallons of water per minute as thin stillage—currently sent to the evaporator and then the dryer, both costly and heat-intensive processes. The Biodynamics process uses traditional wastewater treatment processes to remove waste solids, corn oil and other fermenta-tion inhibitors. The water is then recycled to replace thin stillage backset and a frac-tion of the plant’s freshwater needs. Test-ing shows the process results in greater

or equal ethanol yields. The company is awaiting the results of an independent third party review to confi rm that, he said. In addition, the resulting distillers grains with solubles (DDGS) has a higher concentration of protein, fat and amino acids. On a dry basis, DDGS has 32 per-cent crude protein. With Biodynamics, it rises to 42 percent. Crude fat is increased from 8 to 10 percent to an adjustable 9.3 to 30.5 percent, and lysine content rises from 1.2 percent to 5 percent.

Bonneau discussed another angle on water—a failure in the system. Basic failures include electrical (a power surge, lightening or electrical shorts) and me-chanical (plugged pump or well, metal fatigue or piping failure). The hydrolo-gist recommended periodic maintenance inspections and suggested ethanol plants do testing to gather data. “You don’t have to wait until it’s an emergency,” he said.

—Holly Jessen

Known for getting the deal done right, we’ve been assisting with the development and fi nancing of renewable energy projects since 1996. The next time you need guidance with fi nancing, debt restructuring, tax and securities issues, contracts, government compliance, permitting, or general business plan advice, turn to the experienced attorneys that make up Lindquist & Vennum’s renewable energy groups.

Michael L. Weaver | (612) 371-3987 | [email protected]

Contact Mike or see our web site for a complete list of attorneys that practice renewable energy law.www.lindquist.com/biofuels



Project updates and technology devel-opments in cellulosic ethanol held the at-tention of those in the room throughout the FEW breakout sessions. In a panel presentation following the opening session, Larry Peckous, vice president of sales for EdeniQ, led a discussion on corn ethanol’s metamorphosis to cellulosic production. “Metamorphosis brings to mind the cater-pillar which doesn’t die, but emerges as a butterfl y. Our industry is ready to emerge,” he said. EdeniQ recently received U.S. DOE funding for a project to examine the corn-to-cellulose migration. For that migration’s success, Doug Rivers, director of research and development at ICM Inc., said the in-tegration of starch and cellulose platforms will provide opportunities for process syn-ergies. Other key areas for success will be the infrastructure for biomass handling, pretreatment and conversion strategies that are scalable and cost effective, Rivers added. Phil Madsen, CEO of Katzen International Inc., closed out the panel by questioning the assumption that ethanol was the best use for cellulose. “In Mother Nature’s plan, sugar is to eat today, starch is to store for to-morrow and cellulose is used to build your house and light fi res.” Cellulose to ethanol is not new, he argued, having been done in

the pulp and paper industry for decades. It has not proven economic, Madsen said, pointing to the former Soviet Union where only fi ve of the once 50-some cellulosic plants remain. He suggested it may be more fruitful to expand the use of multiple grain-based feedstocks, work on creating a high starch energy corn and design systems us-ing biomass power.

Several companies offered project up-dates in the cellulosic track. IneosBio is pro-posing an 8 MMgy cellulosic ethanol plant that would produce 1 to 2 megawatts of electricity from vegetative waste and munic-ipal solid waste (MSW), a joint venture with New Planet Energy at Vero Beach, Fla. In-eos, the EU’s largest ethanol producer, has operated a pilot plant for more than seven

Cellulosic Ethanol Viewed from All Angles

Cellulosic ethanol developers as well as those servicing the base corn-ethanol industry were among the exhibitors in the FEW expo.

PH

OTO

: WH

ITN

EY

CU

RTI

S

years using a gasifi er to produce synthesis gas that can be fermented into ethanol. Fi-beright is also targeting MSW, an outgrowth of CEO Craig Stuart-Paul’s experience in both the recycling and micro-brewery businesses. Fiberight purchased a fi rst gen-eration corn ethanol plant in Iowa that was running a fully integrated 24/7 process dur-ing the FEW. “We hope to have the fully in-tegrated system in robust production by the end of 2011,” Stuart-Paul said. Mick Sawka, vice president of commercial development at Qteros, described his company’s work to enhance a bacteria’s ability to produce its own enzymes and convert all fi ve sugars to ethanol in consolidated bioprocessing. The company hopes to integrate a non-geneti-cally modifi ed version of its microbe with corn ethanol production to convert stillage, wet distillers grains and syrup to ethanol, increasing overall ethanol yield by 20 per-cent and producing about half the distillers grains with higher protein content, requir-ing less energy overall.

In a panel presenting new ideas in pretreatment, Johan van Groenestijn from TNO, a Netherlands research organiza-tion, reported on work with a novel dilute acid pretreatment system allowing high solid concentrations and direct fermenta-

tion. Rajai Atalla, Cellulose Sciences International, said the notorious recal-citrance of cellulosic material is a reaction to pretreatment. The CSI understanding of the nanoporous characteristics of cel-lulosic material has resulted in a process using ambient con-ditions and inexpen-sive chemicals. “We expect with optimi-zation and further tuning to substrates, we can reduce enzymatic dosing by a fac-tor of 10,” Atalla said. Borregard/Ligno-Tech is taking a different approach in a new pretreatment process to maximize quality lignin production for performance chemi-cals, according to Gudbrand Rodsrud, mak-ing ethanol from C6 sugars and chemicals from C5 sugars. A pilot plant will start con-struction later this year.

Tim Eggeman, chief technology offi cer at ZeaChem, summarized the view of many in the 24 presentations that comprised the

cellulosic track. While fi rst generation corn ethanol produces enough fuel to run a ve-hicle 5,000 miles on an acre of land a year, he said, advanced biofuels and technologies will achieve 28,000 miles per acre. Combin-ing the advanced biofuel potential with bet-ter gas mileage performance could achieve 50,000 miles per acre of land. “I don’t think people see the power of what’s coming with cellulosic ethanol down the road,” he said.

—Susanne Retka Schill

Mike Bryan, BBI International chairman, and Tom Buis, CEO of Growth En-ergy, speak during the FEW's opening ceremonies.

PH

OTO

: WH

ITN

EY

CU

RTI

S


Extension of the Volumetric Excise Ethanol Tax Credit is the most important issue facing the industry today, said John Urbanchuk, technical director for Entrix Inc., one of many speakers at FEW who referenced the biodiesel industry’s struggles with the lapse of its tax credit. Urbanchuk, whose recent study shows 112,000 jobs will be lost should VEETC not be extended, also highlighted the main reason for the credit. “The RFS2 says you’ve got to use ethanol, it doesn’t say you have to produce ethanol.” The failure to extend the credit would allow foreign producers to provide us with a prod-uct we can already produce within our own borders, according to Urbanchuk. Because VEETC acts as a domestic fuel production incentive, he added, foreign investors may look elsewhere to start a production facil-ity without the incentive to produce in the U.S. If words weren’t enough, Urbanchuk also provided a number. “Without the ex-tension,” he said, “there will be an 86 per-cent decrease in industry profi tability.” A VEETC expiration would push the industry into survival mode.

Other speakers in the business/man-agement track presented varying views of the future. “You are either green or grow-ing or you are ripe and rotting,” said Britta Bergland, senior analyst for Merjent. Mark Lakers, president of Agribusiness & Food Associates LLC PLLP, summarized the possible paths an ethanol facility can take in 2011-'15 as either consolidation, getting out now, or survival. “Survival is not a plan at all,” he said.

Predicting what might happen is of-ten risky, but not preparing for the future is riskier still. Tom Wapp, commodity price risk manager from United Bioenergy, em-phasized that each plant must understand it has a unique fi ngerprint when planning risk management. A plant in Minnesota must deal with different variables than one in a different region, he said, naming fi ve key characteristics each plant should identify to reveal its fi ngerprint—goals and objectives, corn origination, ethanol marketing, distill-

ers marketing, and natural gas purchasing. “Avoid the temptation to compare yourself with other plants unless you know that their fi ngerprint is identical to your own,” Wapp said. He also noted the importance of set-ting goals and parameters for the manage-ment team, which is then given the green light to operate within those parameters, even within a quickly changing environ-ment. The best place to be is in a neutral position as an opportunistic margin hedg-er, he added, carrying short corn futures to offset cash purchases as needed. When margins opportunities do appear Wapp said, buy corn futures back and sell ethanol swaps. This may also include buying natural gas and selling distillers in the cash market, futures and/or OTC market. Ultimately Wapp said, a plant needs to “plan the work, and work the plan,” to be successful.

John Christianson, principal for Chris-tianson & Associates, agreed with Wapp’s

depiction of what makes a plant successful, reiterating that companies that have done well have a clear sense of direction and em-power the staff to head in that direction. “With all the uncertainty, we have to analyze where we want to go and what we want to do,” Christianson said. The place to be, he said, is where a plant can maximize grind margin components. The Minnesota-based company’s “Biofuels Benchmarking Re-port” compares many of these components by region.

Reports like Christianson’s and Ur-banchuk’s and the insights of industry in-siders are necessary for the success of the industry and will play a large role in the future, regardless of what happens this fall with VEETC. “I think we can tell the truth about the ethanol industry “and work for data that will help fi ght the battle,” Chris-tianson said.

—Luke Geiver

On Credits, Risk and the Future

Networking opportunities and educational sessions continue to draw participants from all sectors of the ethanol industry to the annual FEW.

PH

OTO

: WH

ITN

EY

CU

RTI

S


Panel speakers at the FEW discussed back-end coproduct optimization for ethanol plants, including extraction of post-fermenta-tion corn oil from stillage that has been fi nd-ing a home among biodiesel producers. The chief technology offi cer for Greenshift Corp., David Winsness, said only about 4 MMgy of post-ferm corn oil was being extracted from whole stillage at U.S. ethanol plants in May 2007. Two years later, that number grew to 33 MMgy and by May 2010 as much as 44 MMgy of post-ferm corn oil was removed and sold as biodiesel feedstock or for other uses. Win-sness said by 2022, it is expected that up to 680 MMgy of post-ferm corn oil will be siphoned from the back-end of U.S. ethanol plants.

Winsness said the earlier Greenshift ex-traction modules were able to secure up to 0.9 pounds per bushel (lbs/bu) of corn oil, but by applying the company’s latest advanced meth-od, up to 1.7 lbs/bu of post-ferm corn oil can be extracted. He said ethanol producers can make up to 7.9 cents per gallon of ethanol produced by selling their post-ferm corn oil. “This could mean $830 million of new mon-

ey to this industry.” While most corn fraction-ation processes involve front-end component separation after which the non-starch streams can be sold into various higher-value markets, Greenshift has trademarked the term Back-end Fractionation to represent the selective and effi cient removal of valuable components within the whole stillage. “It’s barbaric to use a hammer and chisel approach to separating corn components,” said Winsness of some front-end frac processes.

Ryan Heuer, with ICM Inc.’s business de-velopment unit, discussed Flottweg’s Tricanter technology, which is a three-phase separator isolating the solid “peanut butter-like mate-rial” from the two immiscible liquids with different densities, oil and water. Heuer said unlike competitors’ separation equipment, which use disk stack centrifugation similar to that used for skim milk production, Tricanter technology does not leave entrained solids in the extracted corn oil. He also said the down-time of Tricanter technology is signifi cantly less than with competing oil extraction units. “There’s a 40 to 60 second delay every six or

seven minutes,” Heuer said referring to disk stack units. “That equals a downtime of about 10 percent,” whereas Heuer said downtime for the Tricanter is only about 1.2 percent. He said the purity of the extracted oil product is comparable to yellow grease and actually trades at a premium to yellow grease.

Radhakrishnan Srinivasan, assistant re-search professor at Mississippi State Univer-sity, spoke on the so-called Eluseive process, whose name comes from combining elu-triation and sieving. Using the system, Srini-vasan said it is possible to make lower-fi ber, higher-protein/fat-enhanced distillers grains for chicken and poultry. The separated fi ber can be sold to ruminant feed markets. Using four sieve sizes, the DDGS are fi rst separated according to particle size. Air is then blown into each batch, effectively removing the fi ber for enhanced DDGS. A one-ton-per-hour Elusieve pilot plant is operating at University of Illinois-Urbana Champagne.

—Ron Kotrba

Enhancing Coproducts

Award WinnersJeff Broin, on the right, CEO of Poet LLC, was recognized for his pioneering vision, leadership and unstoppable pursuit of indus-try growth in receiving the 2010 FEW High Octane Award from BBI International Vice President Tom Bryan, far left, at the event’s opening session. Gunter Brodl, below, presi-dent of Vogelbusch USA Inc., received the Award of Excellence. In addition, two students were awarded the newly re-dedicated Kathy Bryan Memorial Scholarship. Mary Krull, the daughter of the plant manager at Valero Renewables-Albert City, Iowa, and Nicho-las Ballard, the son of a process operator at Big River Resources LLC, Galva, Ill., were the recipients.

Gunter Brodl


Advanced biofuels, with an empha-sis on those other than cellulosic ethanol, were featured in the one-day Advanced Biofuels Workshop co-located with the FEW and held, June 14. Michael McAd-ams, president of the Advanced Biofuels Association, called for better coopera-tion among those in the biofuels arena in order to meet the biofuel goals mandated by the U.S. in his keynote speech.

The industry should stop, step back and recognize what the first-generation ethanol industry has accomplished, said John Monks, business director for DSM. Many have a short attention span and have moved on from ethanol to other biofuels. There’s no reason, he said, to discount ethanol. “There’s a lot to be learned from that can-do attitude,” he said. DSM, which started as a mining company, be-lieves there are opportunities to retrofit existing corn-ethanol infrastructure to carry it forward into second-generation success. DSM has calculated that utiliz-ing corn fiber as a cellulosic feedstock could yield an additional billion gallons. “It’s not exactly a no brainer,” Monks said. “There’s going to have to be a lot

of work, investment to get it done.” In addition to renewable diesel and

biobutanol, drop-in biogasoline was dis-cussed by Gary Luce, CEO of Terrabon LLC. The company is partnering with Waste Management and Valero to pro-duce a drop in biofuel that can be used with existing infrastructure. The com-pany’s current focus is on municipal solid waste, but will eventually move to also in-vestigating multiple energy crops as well as algae.

—Holly Jessen

ABW Drills into Advanced Biofuels Pictured clockwise from the top: Martha Schlicher, Monsanto Bioenergy, Pete Moss, Cereal Process Technolgies, Tom Bryan, BBI International, Charles Hurburgh, Iowa State University, Dave Vander Griend, ICM Inc., Bob Dinneen, RFA.

Since 1981, the Renewable Fuels Association (RFA) has been the

authoritative voice of the ethanol industry. Our efforts have yielded an unequaled record of legislative and

regulatory victories. But we consider our track record just the beginning, and are expanding our efforts with a

focus on market development.

The RFA is a trusted source for reliable

the industry, policymakers, and media alike. The RFA is the leading expert on ethanol standards and guidelines

for safety. We are also the preeminent authority on E10 and E85.

The RFA is a member-centered, member-driven organization. Join

with us to help build a strong future for the industry. For more

information, visit www.ethanolrfa.org, or call (202) 289-3835.

Renewable Fuels Association, One Massachusetts Avenue NW - Suite 820 - Washington, DC 20001 - (202) 289-3835.

RFAThe voice of the ethanol industry.

PROFILE

Secretary of Agriculture Tom Vilsack selects questions from the audience at the Clean Energy Economy Forum-Rural Energy Opportunities held at the White House in May.

PHOTO: USDA


An Iowa Ethanol Booster in WashingtonSecretary of Agriculture Tom Vilsack hasn’t been shy about stating his fi rm support for the ethanol industry.

By Holly JessenPhotos By USDA


PROFILE

Secretary of Agriculture Tom Vilsack makes no bones about it. In an interview with EPM, he calls himself a strong pro-

ponent of biofuels and declares his boss, President Obama, is a strong pro-ponent as well. “We want a nationwide robust market for biofuels,” he says. It’s not the only time he’s pledged support for alternative fuels such as ethanol. Still, with the U.S. EPA announcing yet another delay on the E15 issue and no assurance of tax incentive extensions as of the end of June—some in the indus-try wonder if it’s all talk and no action.

Certainly a step in the right direc-tion, the USDA’s “Regional Roadmap to Meeting the Biofuels Goals of the Renewable Fuels Standard,” released June 23, acknowledges the role of corn starch ethanol by pointing out that the U.S. is already on its way to meeting the 15 billion gallon goal set by the renew-able fuels standard (RFS2). “I am confi -dent that we can meet the threshold of producing 36 billion gallons of biofuel

annually by 2022," Vilsack says. "The current ethanol industry provides a sol-id foundation to build upon and reach the 36 billion gallon goal.”

To generate the 21 billion gallons of advanced biofuels, the June USDA report says, an estimated 527 biorefi n-eries will need to be built, at a cost of $168 billion, assuming an average size of 40 MMgy for each plant. In addition, the report says that up to 50 percent of advanced biofuel production will come from the Southeast, due to a robust growing season that supports the high-est gallons per acre. Closely trailing the Southeast is the central east region, with a potential to produce 43.3 percent of the advanced biofuel production goal.

Beyond just building biorefi neries, the USDA recognizes that infrastruc-ture is needed so that biofuels can get from the plants producing them to con-sumers using them. One area where the department could immediately offer assistance is blender pumps, the report says. Although the bulk of fl ex-fuel ve-

PROFILE


Secretary of Agriculture Tom Vilsack testifi es before the House Committee on Agriculture in Washington, D.C.

hicles (FFV) are in the Midwest, there is a demand for ethanol elsewhere, with the primary targets for blender pumps and FFVs being California, Texas and Florida. In addition, infrastructure to distribute ethanol by rail or truck as well as blending terminals and storage facilities is needed.

The Future of an Industry After Vilsack’s April 28 visit to Ma-

con, Mo., where he accompanied the president on a tour of Poet Biorefi n-ing-Macon, EPM had an opportunity to interview the secretary. As stated in the regional roadmap, he stresses

that it won’t just take emergent biofuel technologies to fulfi ll the RFS2. It will take current technologies too, namely ethanol produced from corn. The presi-dent’s visit to a corn ethanol plant was an appropriate recognition of the fact that ethanol will be a permanent part of the U.S. fuel supply, he says. “I think it sends a good message to the biofuels industry.”

When asked about the negative publicity campaign waged by anti-eth-anol advocates, the head of the USDA downplays it. Don’t worry about that, he tells EPM. Some people just don’t realize the effi ciencies and improve-

PROFILE

800-232 -8444 | WATERLOO, IOWAWWW.CPM.NET/PARTS2

ARE YOU STOCKED?

When you need to perform mainte-nance, time wasted is money lost. Reduce downtime—make your spare parts

inventory THE prime directive of your main-

tenance department.

We will handle all of your hammermill spare

parts needs. Call our parts sales department

today for the professional service and expert

advice you have come to expect from

Roskamp Champion.

Preserve th e integrity of your mills.

Use original replacement parts.

Buy genuine Roskamp Champion parts.

Screens

Hammers

Regrind Chambers

Carriages

Rotors

Bearings


Agriculture Secretary Tom Vilsack makes remarks on his commitment to rural America at the 2010 Agriculture Outlook Forum held in Arlington, Va.

Developing a clean, green American economy, with a focus on renewable energy and biofuels, "creates the fi rst real opportunity to develop a holistic approach to revitalizing rural America."

Tom Vilsack, Secretary of Agriculture

ments made in the ethanol process over the years. “I think people are operating under the assumption that this is an ener-gy user and not energy saver.” The more important issue, he says, is moving the in-dustry forward. The goal is to enable the industry to fl ourish to take the pressure off fossil fuel and reduce the nation’s reli-ance on foreign oil. But it’s not just foreign oil that’s the bad guy here. As the oil spill in the Gulf of Mexico has shown, drill-ing off U.S. shores has risks with some very serious environmental consequences,

Vilsack points out, and biofuels are an es-sential part of what it will take to move away from petroleum.

To do that, the blend rate issue must be resolved. “I’m interested in ultimately getting to E15,” he tells EPM, adding that he’d like to see the EPA move as quickly as it can, with proper scientifi c justifi cation. He’s not willing to comment whether E15 would be approved for all vehicles or only newer models, saying only that it is cur-rently being researched. Vilsack says the administration must work with the auto

industry so fl ex-fuel vehicles continue to be built. What he doesn’t want to see, he says, is a situation in the market where a large majority of new vehicles aren’t built to utilize ethanol. In addi-tion, there must be a functioning fuel distribution system, so all consumers have easy access to the fuel they want and need. That means, whether it’s a standard vehicle, one that takes E85 or

PROFILE

McCormick Construction Company 7900 69th Avenue Greenfield, MN 55373

Phone: 763-477-4774 Fax: 763-477-5174

McCormick Construction Your Value-Driven Bio-Energy Contractor.

SERVICES WE PROVIDE:• Design Build• Project Management• Custom Fabrication• Steel Tanks• Concrete Slip-Form• Concrete Foundations & Slabs

• Pre Fab Metal Buildings• Crane Services• Equipment Installation• Millwright Services• Emergency Repair• Strategic Shut Down Planning

McCormick Construction has been involved in the construction of more than 45 bio-energy facilities. The value we bring to every project results in lower operating costs and greater plant productivity. Our objective is to always provide a safe working environment for all employees while delivering a high quality product backed with service and long term customer satisfaction.

Learn more about McC at our website: www.mcormickconstruction.com


During an interview with EPM, Secretary of Agriculture Tom Vilsack said both he and President Obama are enthusiastic proponents of biofuels.

Vilsack is no stranger to agriculture or issues facing rural areas. Obama ap-pointed the former Governor of Iowa to the Secretary of Agriculture spot 18 months ago. His goal for the clean energy forum, he says, was to put it in a very ru-ral perspective. “To my way of thinking, it’s really more than the obvious. It’s more than energy independence, it’s more than the commitment to the environment that this administration has made, it’s more than jobs. It is really a critical component to a strategy to rebuild a rural economy

that, for decades, has been in need of re-vitalization.”

Ninety percent of the counties with persistent poverty are rural. Those regions have aging populations, with 28 percent of farmers over the age of 65. In com-parison, he says, only about eight percent of the general workforce is over age 65. In addition, rural areas are hemorrhaging residents. A whopping 56 percent of rural counties saw population decreases in the 2000 census, and it’s very likely that trend will continue in the 2010 census fi gures.

an older model, the proper fuel should be available at every gas station. “That should be the goal,” he says.

Vilsack is also in favor of long-term extensions of the ethanol fi nan-cial incentives. Without incentives such as the blenders credit, or Volumetric Ethanol Excise Tax Credit, and the Cellulosic Biofuel Producer Tax Credit, it will be diffi cult to get investors inter-ested, he says.

Impact on Rural Areas In May, Vilsack hosted a clean ener-

gy economy forum at the White House, where speakers included USDA offi cials, the chairperson of the White House Council on Environmental Quality, the Union of Concerned Scientists and oth-ers. Also on hand were farmers, ranch-ers and producers. Held on the one year anniversary of Obama’s Biofuels Direc-tive, the group discussed renewable en-ergy opportunities for rural communi-ties and the administration's efforts to help rural America build a clean energy economy that creates jobs, reduces the nation’s dependence on foreign oil and enhances its position in the global econ-omy. "Renewable energy production is a key to sustainable economic develop-ment in rural America," Vilsack said at the forum. "We must rapidly escalate the production of biofuels to meet the 2022 federal renewable fuels standard goal, and much of this biofuel will come from feedstocks produced by America's farmers and ranchers.”

The week the clean energy forum was held, USDA announced that funds were available from the Biorefi nery Assistance Program, Repowering As-sistance Payments to Eligible Biorefi n-eries, Payments to Eligible Advanced Biofuel Producers, and the Rural En-ergy For America Program (REAP)—several key energy provisions of the Farm Bill. USDA is also implementing the Biomass Crop Assistance Program to provide matching payments to help encourage the development of biomass feedstocks.

PROFILE


Iowa is a classic example of what is facing rural areas, Vilsack says. In 1900, more people lived in Iowa than California and Florida combined and the state had

the representation of 13 members in Con-gress. Today, Iowa has skidded to 30th in population and is represented by only fi ve members of Congress—one of which

the state is likely to lose due to further population loss. Most of this country’s founding fathers were farmers rooted in a rural way of life. Today, only one-sixth of the population lives in a rural setting. Agriculture became more effi -cient, requiring fewer farmers, and the country failed to create a companion economy to agriculture to allow people to remain in the rural areas. “This dis-cussion, from my perspective, is really about the core values of the country,” Vilsack says. “It’s about revitalizing a very important part of that core.”

And biofuels are an integral part of that. Developing a clean, green American economy, with a focus on renewable energy and biofuels, he says, “creates the fi rst real opportunity to de-velop a holistic approach to revitalizing rural America.”

Building more biorefi neries to cre-ate jobs in rural economies will help improve the bottom line for farmers and landowners. It will help repopulate rural communities and help those who want to stay there fi nd good jobs. And not just jobs at ethanol plants—it stim-ulates jobs at companies that provide parts, equipment and software for the plants—to name just a few examples. “There are just a multitude of good news stories with that,” he says, giving moms and dads, grandpas and grand-mas the ability to say to youth that they have just as much opportunity for suc-cess in rural America as they would if they moved to a bigger city. EP

Holly Jessen is associate editor of Ethanol Producer Magazine. Reach her at (701) 738-4946 or [email protected].

PROFILE


Secretary of Agriculture Tom Vilsack illustrated the growing productivity of U.S. farmers with this chart.

The next generation alpha-amylase

Improve Ethanol YieldsReduce Sulfuric Acid Use

Improve Eth-anol YieldsReduce Sul-furic Acid Visit us at FEW, booth 1111, to learn more!

• Superior liquefaction and viscosity reduction

• Broad temperature and pH range allows for greater operational flexibility

• Performance at low pH can reduce sulfuric acid use and lower overall sulfur content in DDGS

• Lower residual sugars

Boost Ethanol Yields and Lower Sulfuric Acid Use

Verenium Corporation: 4955 Directors Place, San Diego, CA 92121 1.800.523.2990 Questions? e-mail: [email protected]

Verenium: A pioneer in cellulosic ethanol technology and a leader in high performance enzymes offers the next generation alpha-amylase discovered from the depths of the ocean floor. With a unique mode of ac-tion, Fuelzyme-LF provides:

0

300

600

900

1200

1500

15 min.10 min. 20 min.

Visco

sity (

BU)

Competitor A (20 MWU)Fuelzyme LF (10 MWU)

Competitor B (20 MWU)

Retention Time

GREATER MASH VISCOSITY REDUCTION WITH A LOWER DOSE

BROAD OPERATING RANGE

Competitors

Temperature ˚F (˚C)175 (79)

185(85)

195(91)

205(96)

212(100)

225(107)

Fuelzyme®-LF

Operating Range

Inactive

Competitors

pH

Fuelzyme®-LF4.0 4.5 5.0 5.5 6.0 6.5

®

CANADA


O’ EthanolWith Canada’s renewable fuels standard mandating E5 starting in September, EPM takes a look at the

Canadian ethanol industry.

By Anna Austin


CANADA

In stark contrast to its neighbor to the south, the Canadian etha-nol industry didn’t experience the sweet boom years that the U.S. in-

dustry did, but it also hasn’t suffered sour effects from a declining economy. In fact, it has likely learned a few lessons from its neighbors to mitigate such effects. Signif-icantly smaller than its U.S. counterpart, the Canadian industry hosts 15 commer-cial-scale fuel ethanol plants in operation or under construction, ranging from 12.5 million to 225 million liters per year to total nearly 1.8 billion liters (about 476 million gallons). That’s a small fraction of that of the U.S., which has an installed capacity of more than 13 billion gallons. Canadian producers also enjoy fewer in-centives and less federal assistance than U.S. producers historically have. Canada’s slow but steady progress, however, seems to be cementing a solid foundation for continued growth.

Canadian ethanol plants are concen-trated in Ontario and Saskatchewan, with a scattering in other provinces. Corn is the prevalent feedstock in eastern Cana-da, most of which is grown domestically with roughly 40 percent imported into eastern Ontario and Quebec, according to a recently completed biofuel economic impact assessment report commissioned by the Canadian Renewable Fuel Associa-tion.

Western Canadian plants typically use wheat, of which Canada is a net exporter, ranking sixth in the world among wheat growing countries. In 2008, Canada pro-duced more than 29 million metric tons, and according to the Western Canadian Wheat Growers Association, the seven commercial plants in that region annually require about 1.4 million metric tons of wheat or about 7 percent of the wheat grown in Western Canada.

Aside from corn and wheat, munici-pal solid waste (MSW) is being targeted as the feedstock for a planned facility in Edmonton, Alberta. Canadian etha-nol pioneer Greenfi eld Ethanol Inc. has teamed up with native cellulosic ethanol developer Enerkem Inc. to build a facil-ity that will gasify 100,000 metric tons

of MSW from the city into 40 million liters (10 MMgy) of ethanol.

While new projects such as these continue to build and strength-en the Canadian ethanol industry, the positive economic impact of the bio-fuel industy is infl u-encing the way government and the pub-lic view ethanol and renewable fuels.

Many Angles of Support It doesn’t seem as though Canada

is experiencing the aggressive ethanol smear tactics that the U.S. has, and re-cent polls show signifi cant public sup-port for ethanol and renewable fuels in general. Marie Labrie-Helene, chief of governmental affairs for Enerkem, points out that support seems to be increasing with each year, and companies such as Enerkem that are developing both etha-nol and next generation fuels are poised to benefi t from the increasing public and government support. According to a na-tional poll conducted last year by Praxicus Public Strategies, 69 percent of Canadi-ans support replacing some of the coun-try’s fossil fuels with renewable fuels—specifi cally ethanol and biodiesel—and 87 percent of Canadians support federal policies that would encourage the devel-opment of next generation biofuels. The study also found 74 percent of Canadians support the E5 mandate taking effect this summer, an 8 percent increase from a poll conducted in April 2008.

Canada's renewable fuels standard (RFS) takes effect Sept. 1, mandating E5 blends, though the Canadian Renewable Fuels Association and other groups are pushing for an increase to 10 percent. Until that happens, Canada may have diffi culty positioning itself as one of the global leaders in the biofuel industry, ac-cording to Labrie. “We will need addi-tional programs and incentives, as well as a higher RFS mandate of 10 percent, in

CANADA


Marie Labrie-Helenechief of governmental affairs, Enerkem

order to build the next phase of develop-ment in the biofuels sector and to com-mercialize next generation technologies,” she says.

Meanwhile, federal fi nancial sup-port continues, the most recent being the ecoENERGY for Biofuels Program launched in April 2008 by Natural Re-sources Canada, which will provide up to $1.5 billion over nine years to boost Canada’s production of renewable fu-els. So far, NRC has signed contribution agreements with 21 projects, earmark-ing $765 million for the majority that are ethanol. The program provides operating incentives to producers of renewable al-ternatives to gasoline and diesel, based on production levels and other factors. It seeks to make investment in biofuels more attractive by partially offsetting the risk associated with fl uctuating feed-stock and fuel prices. Recipients receive production incentives for up to seven consecutive years. This includes existing

producers, requests for volume increases from existing agreements and new pro-ducers that clearly demonstrated an ad-vanced state of readiness of their project before March 31. Financial incentives are provided for the number of liters of eth-anol produced in Canada, based on fi xed declining incentive rates established by the program and as agreed upon in each contribution agreement. In 2010, the in-centive payments start at 10 cents per liter for ethanol, and decline by one cent each year until 2017.

Other mandates and incentives vary from province to province. The Ontario government has a provincial mandate of 5 percent renewable fuels, while Manito-ba hosts an 8.5 percent ethanol mandate and Saskatchewan a 7.5 percent ethanol mandate. Alberta has recently extended its support for ethanol and biodiesel by prolonging its BioEnergy Producer Credit Program by fi ve years to 2016, presenting opportunities to build additional capacity

CANADA


Greenfi eld Ethanol's fi rst facility, pictured above, was built at Tiverton, Ontario, in 1989. P

HO

TO: G

RE

EN

FIE

LD E

THA

NO

L

in Alberta with a focus on the great poten-tial for second generation renewable fuels that use MSW and forestry and agricultural biomass feedstock.

Additionally, the governments of Sas-katchewan and Manitoba offer exemptions from road taxes for fuel ethanol produced and consumed in each province, and the governments of British Columbia and Que-bec have committed to exempt the ethanol portion of low-level ethanol blends from their road taxes, though there are no etha-nol plants in B.C. yet. As a result of federal

and provincial producer incentives, actual wholesale prices of ethanol have averaged just over 60 cents per liter so far in 2010. For comparison, in mid-June the national aver-age price of gasoline in Canada was $1.03 per liter.

Ethanol’s Economic Impact As is the case across the globe, next

generation biofuels are eagerly anticipated. From Enerkem’s point of view, however, traditional ethanol isn’t going away. In fact, they will likely grow alongside one another.

“From a feedstock perspective, fi rst and second generation ethanol are comple-mentary and they will both play a role in Canada’s energy future,” Labrie says, adding that Enerkem will build commu-nity-based plants in both urban and ru-ral areas in Canada. “The fl exibility of our technology will allow us to not only produce advanced biofuels from non-re-cyclable MSW but also from forest resi-dues, which are abundant in Canada.”

The communities fortunate enough to become homes of future ethanol or ad-vanced biofuel projects built by Enerkem and others may reap signifi cant benefi ts. According to the recent CRFA Biofuels Impact Report, the Canadian ethanol in-dustry has stimulated growth in new in-dustry sectors as well as exports.

One signifi cant change in the Ca-nadian ethanol industry in recent years is the increasing proportion of capital equipment that Canadian fi rms supply to the country’s ethanol and biodiesel plants. Displacing imported equipment has provided a major benefi t to the Ca-nadian economy, according to the report. It also fi nds that dried distillers grains is becoming a notable Canadian export; as much 50 percent is exported in west-ern Canada, primarily as animal feed for nearby regional U.S livestock. Even mak-ing allowance for the opportunity costs of alternate investments, and the oppor-tunity costs of alternate feedstock sales, renewable fuels plants in Canada repre-sent a positive net economic benefi t. To-gether with the operating biodiesel plants in the country, the 28 renewable fuels plants provide a total of 2.25 billion liters of renewable fuels annually, generating annual economic benefi ts of more than $2 billion to the Canadian economy. This includes more than 1,000 direct and indi-rect jobs, the report fi nds.

While fi rst generation ethanol pro-duction continues to build out, cellulosic ethanol companies and new projects have begun to spring up in Canada as well. Potentially, they will add greatly to the newly realized economic benefi ts of biofuel production in Canada.

CANADA

Environmental Sustainability,ro ess E ien y

3D TRASAR® technology – Detect conditions, Determine action, Deliver results…automatically.

847-452-4745e-mail: [email protected]

www.nalco.com/ethanol

You know Ethanol.We know Water.

Essential Expertise

for Water, Energy and Air

SM

TRASAR


to-ethanol/methanol plant in Westbury, Quebec, and is developing a U.S. DOE-backed waste-to-biofuels plant in Pontotoc, Miss. The $250 million project will recycle and convert approximately 60 percent, or 189,000 tons, of the MSW from the Three Rivers Landfi ll where the 20 MMgy facility will be built.

There several other ethanol plants are scattered across the country. Some of them are working on expansions, some are part-nering for additional projects, and others are simply focusing on optimizing current

operations. Keeping the ethanol industry ball rolling, Canada just may demonstrate that its slower and steadier technique wins the race. EP

Anna Austin is a Biomass Magazine asso-ciate editor. Reach her at 701-738-4968 or [email protected]

Glance at Producers On a much smaller scale, Green-

fi eld Ethanol is to Canada what Poet LLC or Archer Daniels Midland Co. are to the U.S. Initially known as Commer-cial Alcohols, the company made its fi rst deal for a commercial-scale fuel ethanol plant in 1996. It opened two years later in Chatham, Ontario, and is in full op-eration today. Greenfi eld now has four operating corn ethanol plants, and is planning two additional ones—a corn ethanol plant in Hensall, Ontario, and the joint project with Enerkem to produce cellulosic ethanol in Alberta.

Husky Energy, one of Canada's larg-est integrated oil and gas companies and Western Canada’s largest ethanol pro-ducer, has been manufacturing ethanol since 1981. The company has two plants, located in Lloydminster, Saskatchewan, and Minnedosa, Manitoba, that collec-tively produce 260 million of liters of grain ethanol per year.

Oil sands company Suncor Energy operates Canada's largest ethanol facility, the St. Clair Ethanol Plant in the Sarnia-Lambton region of Ontario. The plant opened in June 2006, and has an annual production capacity of 200 million liters per year, with a $120 million expansion project underway to double its capacity. According to the company, the plant cur-rently uses 20 million bushels of corn annually, or approximately 10 percent of Ontario's annual corn crop.

On the cellulosic side, Iogen Corp. has been around for the better part of a decade. Its demonstration facility in Ottawa, Ontario, opened in 2004, and is designed to process about 20 to 30 met-ric tons per day of ethanol from wheat straw. With an approximate daily capacity of 5,000 to 6,000 liters of cellulosic etha-nol, the fuel produced at the demonstra-tion facility is currently being purchased by Royal Dutch Shell, and together the companies have formed joint venture Io-gen Energy.

Aside from its project with Green-fi eld, Enerkem began operations in Janu-ary 2009 at its commercial-scale syngas-

CANADA

Jumbo™

Tankman™

Sellers 360

ROTATING WASH HEADS FOR ALL PROCESS VESSELS

Effi cient, Powerful, Dependable cleaning heads for tanks and fermenters up to 70 feet in diameter.

Unmatched versatility Low-maintenance operation Long-term reliability Industry specifi ed

Cloud/Sellers, 4120-A Horizon Lane, San Luis Obispo, CA 93401 USAPhone: 805-549-8093 Fax: 805-549-0131E-mail: [email protected] Web: www.cloudinc.com


November 2 - 4, 2010Hyatt Regency Atlanta

Atlanta, Georgia

www.biomassconference.com/southeast

Visit www.biomassconference.com/southeast and:View interactive exhibitor mapSee conference sponsors and review sponsor benefitsRegister to attendExplore conference agendaAnd much more!

PROMOTION

This print ad is one of several in the NCGA promotional campaign to support corn ethanol.


The New Face of Ethanol2010 has seen several ethanol-infused television commercials and an unprecedented U.S. oil spill, all of which are shaping the perception of the industry.

By Luke Geiver


PROMOTION

PROMOTION

Get Connected with the Unmatched Performance of ATEC Steel... The Industry Leaders in Field-Weld Tank & Specialty Steel Construction!

At ATEC Steel, we build precision in the shop and excellence in the field:

√ Unmatched API Tank Construction√ Pressure Vessels, Columns & Stacks√ Specialty Steel Fabrication√ Dry Bulk Silos & Hoppers√ Liquid Storage Terminals√ Tank Field Construction√ Tank Inspection, Maintenance & Repair

#1 in Knockdown Steel Tank Fabrication & Construction! www.AtecSteel.com PH: 877.457.5352

ATECAA STEEL – AN INDUSTRY LEADER IN FIELD-WELD,D SHOP-WELD, DSPECIALTLL Y STEEL FABRICATIONAA & FIELD CONSTRUCTION SERVICES!

America, backed by the most experienced TEAM in the industry!

Power IndustryOil & Gas

Chemical & PetrochemMinerals & Mining

Water & WastewaterDry Bulk Storage


A month before the gushing cloud of dark brown oil burst out of a broken pipe and the Deepwater Horizon tragedy

spilled onto our shores and our televi-sion screens, a Consumer Federation of America survey revealed what many Americans are thinking about energy. The survey, conducted by Opinion Research Corp., showed that of the 1,010 adults surveyed, 87 percent believe that it’s “im-portant” the U.S. reduce oil consumption. “Our survey data strongly suggests that the American public is getting very close to the point, if they’re not already there, where they are prepared to support radi-cal measures to break our nation’s depen-dence on oil and oil imports,” said Jack Gillis, CFA director of public affairs, in announcing the survey results.

The endless images associated with the greatest U.S. environmental disaster of all time—a fi shing boat dragging an orange boom to corral a slick of oil or a stained pelican drenched in a chocolate-colored residue from wing to wing—

certainly will infl uence public perception. Ethanol supporters hope those images will cast the debates surrounding biofuels in a new light. Luckily, several advertising campaigns were in the works before the oil spill. Visually and verbally, the cam-paigns are aimed at changing the Ameri-can public's perception of ethanol.

The VisualEven with a strong national presence

at the pump, the general appearance and perception of ethanol in the mainstream has mainly been provided by billboards, print advertisements and websites. Since April, however, television commercials created by prominent ethanol promoters have been airing on CNN, MSNBC, Fox and HLN networks. Supported by Poet LLC, Growth Energy, UNICA and the National Corn Growers Association , the ads are giving a new face to ethanol remi-niscent of the “Got Milk” presence.

The newest of these, from the NCGA, began airing June 28. Speaking over a series of images that starts with a

fl aming oil rig in the middle of an ocean, a voice declares, “It’s clear that events here at home and abroad demand a differ-ent solution to our energy needs.” NCGA coupled its TV commercial with a series of print ads featuring individual farmers and farm families with one person hold-ing a numbered sign, the number associ-ated with an important statistic. One ad states, “An acre of corn removes 8 tons of harmful greenhouse gas, more than that produced by your car.”

Ken Colombini, director of com-munications for the NCGA, says the ad campaign was developed to advance the success of the Renewable Fuels Reinvest-ment Act, and to assist with the inclusion of pro-corn ethanol provisions in the proposed energy bill. “Whatever the ve-hicle, NCGA supports energy legislation extending the Volumetric Ethanol Excise Tax Credit and the tariff on imported ethanol,” Colombini says. “If VEETC expires at the end of this year, U.S. etha-nol production capacity could decrease by 38 percent and impact rural communities

Driving Excellence In Your Operation

BIODIESEL

ETHANOL

OILSEEDS

More Selections More Solutions Tsubaki: The choice for chain

™

Nobody But Us.

www.ustsubaki.com/ethanol(800) 323-7790 2010 U.S. Tsubaki, Inc. All rights reserved.

most heavily. For corn farmers, this also could mean a 30 cent per bushel price drop.”

Darrin Ihnen, president of the NCGA, also cites the future energy bill in talking about NCGA’s investment of more than $1 million in the new cam-paign for ethanol. “Legislation is before Congress to continue much needed in-centives and there is a new energy bill on the horizon, making it an important and critical time to talk about ethanol’s many environmental and economic benefi ts to our country.”

As the NCGA commercial plays out on the screen, it makes the case that the answer to our energy needs are right here in the U.S. “One answer grows in our own backyard,” the commercial states,“turning American corn into America’s energy.” Pointing to a June 21 USDA study citing the improved effi ciency of corn ethanol production, Ihnen adds, “it’s no wonder we’re saying ‘Now is the time for etha-nol.’ The industry is making great prog-ress and corn growers have another re-

PROMOTION

Commuters on the Washington, D.C., metro are met with Growth Energy's campaign to present the facts on ethanol.

PH

OTO

: GR

OW

TH E

NE

RG

Y

cord crop in the fi eld so we can meet all needs.” Overlapping an image of a young farming family, the voice in the commercial adds, “We feed the world. We can fuel it, too.”

Poet’s television campaign, launched well before the oil spill, aims at telling the story of ethanol to a larger audi-ence, according to Greg Breukelman, Poet’s senior vice president of commu-nications. In three separate commercials featuring a plant manager, a farmer and a scientist, the camera zooms in on the person speaking freely amongst people bustling by, in a place where cornfi elds are miles away—New York City. The plant manager wearing a hard hat, a pair of khakis and holding a clipboard, starts his free verse poem, “American Dollar, a poem,” and goes on to say, “The dol-lar is still building the tallest buildings in the world. It just built one in Dubai. $250 billion a year for foreign oil will go a long way.” The commercial ends with

the speaker (a fi ctional character named Steve Ross) walking away into the crowd of people on a busy street. A phrase on the screen then comes into focus saying, “For every billion gallons of ethanol produced, we create 20,000 American jobs.” Similarly, Poet’s other two com-mercials also include a free verse poem on the subject of ethanol. The farmer spot shows a man dressed in a faded brown Carhart jacket with baseball cap in hand speaking about what his family can do for America: “Give me a little rain mixed with a little sun. I’ll give you plenty of food with fuel to boot. And I’ll do the same thing tomorrow.” And the commercial featuring a woman sci-entist dressed in a white lab coat tells the viewer, “I turn waste into fuel…and one day I’ll let you tell the Middle East where they can ship their tankers.”

It wasn’t just the U.S. industry reaching out to consumers. UNICA, the Brazilian Sugarcane Association aired

PROMOTION

1-800-279-4757

Call us for a free, no-obligationconsulation today.

Natwick Associates Appraisal Services1205 4th Ave. S., Fargo, ND 58103

[email protected]

The Specialistin Biofuels Plant

Appraisals• Valuation for financing

• Establishing an asking price

• Expert witness testimony

• Partial interest valuation

Few certified appraisers in the United States specialize in ethanol plant and relatedbiofuels properties. The firm of Natwick Associates offers more than 50 years of worldwide experience. Your appraisal will be completed by a certified general appraiser and conformto all state and federal appraisal standards.


This banner appearing in a D.C. Metro station is a compilation of the short pro-ethanol statements used in Growth Energy's pro-ethanol campaign.

PH

OTO

: GR

OW

TH E

NE

RG

Y

its commercial during the 99th edition of the Indianapolis 500. Several Indy car drivers including well-known driver Helio Castroneves, say in the spots, “I compete with sugarcane ethanol.” The commercials “seek to educate Ameri-can consumers about sugarcane ethanol and how it can benefi t their pockets, the environment and the market,” says Joel Velasco, UNICA’s chief representative in North America.

The Verbal

While plant managers reciting po-etry, family farmers holding signs or Indy 500 drivers promoting the fuel in their cars, all help shape a new face for ethanol on the television screen, there are other important, less visible mea-sures being taken. Following the gulf oil spill, the Renewable Fuels Associa-tion president and CEO Bob Dinneen wrote to President Obama, closing with the statement: “I encourage you to un-leash the ingenuity and productivity of American farmers and ethanol produc-ers to help end America’s dangerous ad-diction to petroleum.” The letter to the president is only one example of the group’s highly successful and informed pursuit to promote, educate and lobby for the use of ethanol. RFA has turned to using new media to spread the etha-nol message. Robert White, director of market development for the RFA, recently won an award for his role in using social media outlets such as Face-book and Twitter. “Robert is certainly a deserving recipient of this award,” said Dinneen. “His recognition is evidence of the commitment RFA has made to utilizing all available outlets to spread the word about the exciting evolution of America’s ethanol industry.”

Boiling the ethanol story down to a simple message was the goal of Growth Energy’s series of television ads that, by a stroke of luck considering they were developed well before the oil spill, in-clude the statement “No beaches have been closed due to ethanol spills.” In a combination of visual and verbal ele-ments, the Growth Energy spots feature

a single statement over a bright green background. Phrases such as “No wars have been fought over ETHANOL,” or “We won’t have to wait millions of years to replenish our ETHANOL re-serves,” linger on the screen before the Growth Energy logo appears. There is no alarming image, no actual face speaking, just a factual statement on a green screen. The advertisements fi rst appeared on television in April and the messages have been plastered across a Washington D.C. metro station. “There is no question as to ethanol’s benefi ts—we are just seeking to turn up the vol-ume and target our audience at a critical time,” says Chris Thorne, director of public affairs for Growth Energy.

Arguing that the nation is in a critical time following the Gulf spill, or that Americans want to move away from foreign fossil fuels, given the CFA survey answers, might seem easy. But, Brian Jennings, executive vice president of the American Coalition for Ethanol, points out that the industry needs to be respectful in the way it promotes itself in the aftermath of the tragedy. “We don’t have to choose to rely on oil,” Jennings he says. “We could pivot to the alternatives that are here now, which is primarily corn ethanol.”

That corn ethanol is a viable alter-native to oil won’t be the automatic con-clusion, however. Thus it is providential that multiple campaigns to boost the image of ethanol appeared just when an oil crisis erupted and anticipating another tough fi ght in Washington. In more than one recent report from or-ganizations pushing for investment in clean energy, a long list of worthy alter-natives is given—without a word about renewable fuels or biofuels, let alone the word ethanol. Going directly to the American public may be just what is needed. EP

Luke Geiver is an associate editor of Etha-nol Producer Magazine. Reach him at (701) 738-4944 or [email protected].

PROMOTION

••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••

•••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••••

•••••••

•••••••••••••••••••••••••••••

••••••••••••••••••••••••••••

•••••••••••••••••••••••••••••

BOILERSSELL•RENT•LEASE

IMMEDIATE DELIVERYCALL:800-704-2002

24 / 7 EMERGENCY SERVICE

wabash444 Carpenter Avenue, Wheeling, IL 60090

POWEREQUIPMENT CO.

10HP TO 250,000#/hr250,000#/hr Nebraska 750 psig 750OTTF

150,000#/hr Nebraska 1025 psig 900OTTF


150,000#/hr Nebraska 350 psig



80,000#/hr Erie City 2000 psig 800OTTF





20,000#/hr Erie City 200 psig

10-1000HP Firetube 15-600 psig

ALL PRESSURE AND TEMPERATURECOMBINATIONS SUPERHEATED

AND SATURATED

RENTAL FLEET OF MOBILETRAILER-MOUNTED BOILERS

75,000#/hr. Nebraska 350 psig

75,000#/hr. Optimus 750 psig 750°TTF





75-300HP Firetube 15-600 psig

ALL BOILERS ARE COMBINATION GAS/OIL

ENGINEERING • START-UP

FULL LINE OF BOILER AUXILIARYSUPPORT EQUIPMENT.

Electric Generators:• 50KW-30,000KW

WEB SITE: www.wabashpower.com847-541-5600 • FAX: 847-541-1279

E-mail: [email protected]


WASTE-TO-ETHANOL

HogwashCould hog manure be an environmentally friendly avenue for ethanol production? Meet some people who think the answer to that question is “yes.”

By Holly Jessen

PHOTO: NATIONAL PORK BOARD



WASTE-TO-ETHANOL

Of all the possible feedstocks for an ethanol plant, hog manure has to be one of the most aromatic. A Cana-

dian hog farmer and a group of research-ers in North Carolina are approaching hog waste from different angles—one targeting recycled water and the other looking directly at the cellulose fraction. What these projects have in common is converting what comes out of the poste-rior of a pig into ethanol.

Clean Water from WasteWill Kingma, owner of Kingdom

Farms, thinks that ethanol—as part of a bioenergy cluster—is the answer for his hog operation near Bentley, Alberta. Kingma envisions a future where his hog operation works synergistically with four elements: a water recycling system, an ethanol plant, ethanol coproducts for feed and biodigestion for power genera-tion.

Kingma’s 1,800 sows produce about 35,000 to 40,000 pigs a year that, in turn, produce about 18 million gallons of ma-

WASTE-TO-ETHANOL

SPEC IT AND FORGET IT.

www.checkall.comS i n c e 1 9 5 8

West Des Moines, Iowa USA

Check-All Valve is your

one-stop supplier for the

check valves you need in the

materials you require. Better

yet, every valve includes the

experience, engineering, and

application know-how you need

for “spec-it-and-forget-it” reliability.

After all, you have better things to

do, and check valves are all we do.

Call us at 515-224-2301 or e-mail us at [email protected].


The lagoon, shown at a hog operation in North Carolina, is a familiar site across North America.

PH

OTO

: BIO

RX

N

and transporting manure ranges from 90 cents to $1.50 a gallon while the LWR sys-tem costs about 25 to 40 cents per gallon of manure to operate. “Their pay-out will be less than two years,” Thurston says.

The next step for Kingdom Farms is a wheat-to-ethanol project. The 6.6 MMgy proposed ethanol plant is currently in the engineering, permitting and fi nanc-ing stage, with a projected construction start in the spring or fall of 2011, Kingma says. The plan is for recycled water from the LWR system to supply about 50 per-cent of the ethanol plant’s water needs. The ethanol plant will produce wet dis-tillers grains (WDG), half of which will be pumped directly to the barns and fed to the hogs on site. Currently, Kingdom Farms purchases WDG from the Per-molex International ethanol plant located about half an hour away. Producing WDG on site will save the hog operation another $10 to $12 a head.

The remaining WDG will go into a biodigester to produce methane gas for electrical generation. It would produce more than enough power for on-farm use and may also produce enough electricity to be sold to the grid, Kingma says. In addition, because there’s no need to dry the distillers grains, the plant won’t need centrifuges or dryers, which should save about one-third of the capital costs.

Zeroing in on CelluloseJeffrey Macdonald teaches biomedi-

cal engineering at the University of North Carolina. He’s also CEO of BioRxn, a startup company working to develop a cost-effective way to turn manure into electric power and ethanol while reduc-ing odor. Macdonald got the idea when driving through North Carolina, the state ranked second behind Iowa for hog pro-duction. Two North Carolina counties, Duplin and Sampson, have a population

nure. After getting complaints from the citizens of nearby Bentley, Kingma started looking for ways to reduce the odor. “We wanted to be able to pro-duce hogs in a neighborly fashion,” Kingma tells EPM. He was also look-ing for ways to bolster his business fi -nancially, due to the poor economics of hog farming.

After several years of searching, Kingma is partway to his goal. The fi rst step was installing a Livestock Water Recycling system, recovering 70 percent of the liquid in hog manure as potable water. The process reduces the original manure volume by 85 percent, resulting in a small amount of solids and an am-monium-rich fertilizer that can be sold or used on the farm. Its planned pro-cessing speed is 30 gallons of manure a minute, said Ross Thurston, president of LWR, the Calgary, Alberta, company that manufactures the system.

This is the fi rst system installed on a hog farm and several more are in the works, he says. The company has units that can handle varying amounts, from 10 million gallons of manure yearly, to two combined units processing up to 75 million. Kingma estimates the sav-ings alone from reducing the amount of material to be trucked away amounts to about $8 a head. LWR breaks it down this way: The current cost of handling

WASTE-TO-ETHANOL

www.binmaster.com800-278-4241402-434-9102

© 2010 Binmaster, 7201 N 98th St.Lincoln, Nebraska 68507 USALEVEL CONTROLS

VisitBooth 208at the ACE

EthanolConference

3DLevelScanner

Non-Contact, Dust-PenetratingBin Volume Measurement


Kingdom Farms Plan

-Recover 70 percent of water in manure (savings of $8 per head)-6.6 MMgy wheat-to-ethanol plant (half the water from recovered water)-Half the WDG to feed hogs (savings of $10 to $12 per head)-Half the WDG to biodigester for power generation (saving one- third the capital cost for the ethanol plant)

of about 50,000 each, more than 2 mil-lion hogs each and a big odor issue.

All the volatile aromatics in the air got him thinking. Why not take that problem and turn it into methane, CO2, recycled water and ethanol? Hogs, once they hit 200 pounds, excrete an amazing 2.2 gallons of waste a day, Macdonald says. That’s nearly 10 million gallons of manure daily from the more than 4 mil-lion hogs in Duplin and Sampson coun-ties alone. Macdonald calculates North Carolina hogs are currently wasting $900 million a year in unutilized power. He calculates that BioRxn technology could convert the waste from 1,000 hogs to 20 kilowatts of energy and re-ceive a premium of 18 cents per kilo-watt from a renewable energy credit.

At a typical hog operation in North Carolina, hog manure is moved from barn pits to lagoons and then spread over fi elds as fertilizer. The state has limits on how much manure can be spread as fertilizer, however, and opera-tors aren’t allowed to create any more lagoons than the ones already in use. Macdonald’s idea is to put a bioreactor between the hog barn and the lagoon, remove gasses and cellulose and send recycled water to the lagoon. “We don’t want to get rid of the lagoon, per se, we’ll just get rid of the stink,” he says. Another positive will be that by reduc-ing the nutrient load in the lagoons, hog operations could potentially expand since the land limitation for spreading waste due to overloading of nutrients would be mitigated.

Macdonald and Andrey Tikunov designed a bioreactor using tubes fi lled with water and bacteria for separation and anaerobic digestion of the hog ma-nure. The methane produced could be used for electric generation for use on the farm or to be sold to the grid.

To produce ethanol from hog waste, Macdonald says one avenue could be simple fermentation of the sugar fraction at the start of the pro-cess. In addition, the team has also sub-mitted a grant proposal to research the

WASTE-TO-ETHANOL


Jeffrey Macdonald and his partner Andrey Tikunov have designed a bioreactor they hope will make a big impact on the North Carolina hog industry.

PH

OTO

: BIO

RX

N

use of acetogenic bacteria in the fi nal stage of the BioRxn process to produce ethanol.

The next step in the bioreactor de-sign may be to separate the cellulosic fraction to be sold as feedstock to an ethanol plant. Hog feed is, after all, 80 percent corn, Macdonald says. Swine are not ruminates like cows, and instead of digesting cellulose, they concentrate it. So, the cellulose would be a high value feedstock, and unlike wood chips, it would be preprocessed and soluble. “What the market needs will dictate the direction that we take it,” says Michael Van Hoy, scientifi c and business advisor for BioRxn.

The intriguing thing about the BioRxn bioreactor is that as a gas lift multi-phase bioreactor it should be more effi cient than stirred bioreac-tors. Van Hoy compares a single-phase stirred tank to human digestion—if it was done using only the mouth. The multi-phase bioreactor, however, is like

using the whole human digestive sys-tem, the mouth, stomach and intestines. “We’re designed that way for a reason,” he says. “And for similar reasons, our multi-phase bioreactors should be more effi cient than a single phase stirred bio-reactor.”

At this point, Kingma’s idea of us-ing water recycled from hog manure for ethanol production is the closest to becoming a reality. BioRxn’s project is in the very early stages of development and the company is still working to scale up the bioreactor to handle about 20,000 gallons of hog waste a day and, possibly, isolate and degrade the cellu-lose into cellulosic ethanol, Macdonald says. If successful, these projects could turn the sour smell of hog manure into the sweet smell of opportunity. EP

Holly Jessen is associate editor of Ethanol Producer Magazine. Reach her at (701) 738-4946 or [email protected].

WASTE-TO-ETHANOL

STEP UPYOUR GRINDWITH CPMStop losing money on energy costs.

Increase your efficiency with a step

grinding solution from CPM.

Ethanol producers are turning to

CPM for step grinding solutions to

reduce operating costs and improve

particle size control.

For a free consultation,

call 800-336-2563.

800-366-2563 | WWW.CPM.NETWATERLOO, IOWA


Manure from pigs raised on slatted fl oors falls into pits and is transferred to lagoons. Two projects are exploring ways to recycle the waste into ethanol.

PH

OTO

: NAT

ION

AL

PO

RK

PR

OD

UC

ER

S C

OU

NC

IL


Countless injuries have been attributed to multiple hazardous energy inputs. The maintenance technician locks out the power but does not bleed off the stored energy in a charged line and block the chemical feed lines. Other

injuries can be attributed to a lack of labeling of hazardous energy inputs along with elec-trical panel labeling. Some in-juries happen when the facility is modifi ed but the equipment-specifi c lockout/tagout (LO/TO) procedure is not updated.

An LO/TO standard cov-ers the servicing and main-tenance of equipment where an unexpected energization or start up, or a release of stored energy could cause injury. Writing an LO/TO standard starts with tracing back and

labeling all inputs and crafting an equipment-specifi c proce-dure.

Implementing the safety program begins with thinking carefully about the role of em-ployees in three job classifi ca-tions:

Creating, Auditing Equipment-Specific Lockout/Tagout InstructionsHazardous energy is a silent killer. The power can be on, but there is no smell, taste or other indication that electrical, hydraulic, pneumatic, steam, mechanical or chemical power is present. Proper safety procedures require a methodical approach.

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

SAFETY. BY DAVID AYERS

Contribution

The bottom lock out is properly tagged while the top needs a tag attached.

PH

OTO

: AP

PLI

ED

SA

FETY

MA

NA

GE

ME

NT


Author ized—an employee who locks or tags out machines or equipment in order to perform servicing or maintenance or equip-ment.

A f f e c t e d — a n employee whose job re-quires him/her to oper-ate equipment or ser-vices on which servicing or maintenance is being performed under lockout or tagout, or places him/her in an area in which servicing or maintenance is being performed.

All others—Em-ployees not directly in-volved in authorizing or operating specific equip-ment must be trained to recognize LO/TO devic-es and tags and to not at-tempt to start a machine under LO/TO.

TrainingEmployee training

is very important for a fully functional lock-out/tagout program. All personnel should understand the duties of authorized, affected and other employees. It should be stressed that those not designated as authorized should not work on the equip-ment. Many employees have been injured be-cause they watched the machine being serviced, decided they could do it themselves and inadver-tently skipped a step or did not lockout/tagout

the equipment at all.

Equ ipment is to be locked out and tagged whenever a safety guard is removed or by-passed. LO/TO should be imple-mented whenev-er an employee is expected to place any part of their body into a danger zone during a machine operat-ing cycle. This applies to hazardous moving parts and hazardous energy sources.

Exempted Situations

Some pieces of equipment will not need an equipment-specific lockout/tagout pro-cedure. Examples in-clude hazardous energy that has a single energy source which can be eas-ily identified and isolat-ed, and machinery that is plugged into a socket where the technician has control of the plug, there is no potential or stored energy, and re-accumula-tion of hazardous energy cannot happen whether it be it electrical, hydrau-lic, pneumatic, steam or other.

There is also an ex-emption from creating equipment-specific lock-out/tagout procedures if the facility has had no accidents involving the

u n e x p e c t e d activation or re-energiza-tion of the e q u i p m e n t during ser-vicing. Don’t wait for an a c c i d e n t i n v o l v i n g h a z a r d o u s energy to oc-cur, however.

Be proactive and create equipment-specific lock-out/tagout procedures for potential hazards.

For those new to the field of facility man-agement or just starting to address equipment-specific lockout/tagout procedures, the project can seem like Mission Impossible.

There may be push-back from supervisors and managers who want to address the problem as the equipment or ma-chinery breaks. While this is a tempting argu-ment, when equipment or machinery break, the emphasis is to “hurry up and get it back on-line,” not to step back and write a safety procedure.

A step-by-step ap-proach will help in as-sessing the current situa-tion and addressing gaps in procedures. A best management practice is to form a team since this task is too large for one person. Garner sup-port from those techni-cians involved on a daily

David Ayersoccupational safety consultantApplied Safety Management


SAFETY. BY DAVID AYERS

basis—there will likely be site knowledge that has not been documented. A team also helps to build a sense of ownership instead of the attitude “it’s the facility manager’s job, let him do it.” The following five-step approach works well:

1. Ensure all valves, breakers, steam lines, chem-ical distribution lines, gas lines, etc. are properly la-beled and tagged. Add di-rectional arrows to lines containing steam, liquids (water or chemicals) and gases. A best management practice is to have labels every 10 feet from point of service to the equipment. Also place the labels on both sides where the ser-vices cross through a wall, floor or ceiling. Have the equipment technicians who service the equipment assist you. Brass tags work great for outside areas.

2. Ensure that all valves, breakers, etc. have the abil-ity to be locked out/tagged out. If you have an older fa-cility, you may have equip-ment or machinery that was designed and manufactured prior to the lockout/tagout standard. You will have to use tagout in this case and ensure it provides the same level of protection as if it were locked out. Survey the equipment to determine the type of lockout device along with the size. But-terfly valves come in many sizes and the lockout de-vices must be sized prop-

erly to lockout the valve. Also determine the number of locks that will be need-ed and be prepared for a worst-case scenario where multiple lockout operations occur simultaneously.

3. Check the facil-ity blueprints or modi-fied “as-builts” to make sure all information is up to date. It is not uncom-mon that when a facility is modified that services are abandoned in place. Docu-ment such abandonments both on the drawings and the service itself. There are several good software pack-ages in which to store and modify drawings. A best management practice for storage on compact discs is to copy the software used for the drawing along with the system requirements in case the CD is to be used for reference in the future. Regular backups need to be incorporated.

4. Write the equipment-specific LO/TO procedure, which can be integrated into existing maintenance documents and checklists. Have the technicians who perform the daily work help in writing the procedure. If they cannot identify all the lockout/tagout points, then they probably are not performing lockout/tagout correctly.

5. Review the proce-dure with the technician. Be specific and thorough. In particular, watch for vague statements such as

E-10 and rising!DON’T FALL BEHIND PRODUCTION WITH

INFERIOR TANK CLEANING

MACHINES.

No CloggingLow MaintenanceDurableSuperior Cleaning

If you have a tank to clean… we have a way to do it!

1-877-GAMAJET or Gamajet.com

Weighs under 15 lbs!


“lockout the valve”—most plants have hundreds of valves. Verify that what is written on paper matches the actu-al procedure and that it is easily un-derstood, and not just by the person writing the procedure or servicing the equipment. Test it by having an unas-sociated technician walk through the procedure. This is also a great tool for cross-training.

System MaintenanceOnce the procedures are writ-

ten and training is complete, consider how to maintain the system. Ongoing documentation is also very important so that equipment and site knowledge is not lost should the technician move on. Equipment-specific procedures must be kept up-to-date.

A best management practice is to review the procedure yearly when the piece of equipment has its annual preventive maintenance check. The technician can demonstrate the en-tire safety procedure and show his/her competence in locking out/tag-ging out the equipment to be serviced. This is a nice way to ensure the pe-riodic review is conducted while inte-grating it into an existing work flow plan. Ensure any modification or new

additions to the facility are input into your current blueprint system. When equipment or utility services are modi-fied, ask the equipment supplier to help with the equipment-specific lockout/tagout procedure. A great time to train your technicians, is when the equipment is initially installed in the facility, as the vendor is there and can help.

Creating equipment-specific lock-out/tagout procedures is very important in preventing accidents associated with servicing equipment with hazardous en-ergy. Equipment with multiple inputs of hazardous energy must be surveyed to ensure all forms of the hazardous en-ergy have been lockout/tagged out. Sur-vey the equipment to ensure you have enough equipment for a worst-case sce-nario of having to perform several lock-

out/tagouts at the same time. Creating equipment-specific lockout/tagout pro-cedures can be difficult, but if you get the help of the technicians who work on the equipment every day, it can be very fast and smooth.

A step-by-step-approach followed by verification works very well. This will help ensure you have no injuries attrib-uted to the inadequate control of haz-ardous energy. EP

David Ayers is the principle occupational safety consultant at Applied Safety Man-agement. Reach him at [email protected] or (443) 896-7540.

Creating equipment-specifi c lockout/tagout procedures can be diffi cult, but if you get the help of the technicians who work on the equipment every day, it can be very fast and smooth.


The cost to dry stillage, or any biomass, is generally calculated based on a straightforward linear assumption—the more biomass dried, the higher the cost. We live in a nonlinear world, however, where linear logic doesn’t always hold true. When it comes to pro-ducing biomass, this is often the case because the energy-related costs required to dry an extra ton of biomass depend on a number

of constantly shifting—and not necessarily linear—factors, in-cluding wet cake moisture levels, dryer loading and current drying effi ciency.

These fl uctuating variables present myriad challenges for commodity managers when pric-ing stillage to sell to a local market. Often the biggest hurdle is trying to identify the ideal amount of wet/local stillage to produce on a

given day. This is a diffi cult deci-sion to make when the manager doesn’t have an effective way to determine the market price “tip-ping point” that should change their decision about how much wet or dry stillage to produce that day.

A dryer/stillage management model project can help commod-ity managers overcome some of these challenges. Model-based

control is based on a mathemati-cal model designed to be opti-mized based on price. The model incorporates real-time costs of manufacturing, along with scenar-io optimization, and can tie this information to a browser page available to commodity and plant managers.

Producers can use this model to calculate the ideal busi-ness scenario based on varying

DDGS, WDGS, Modified—Which Makes More Money Today? Model-predictive control projects can help ethanol producers improve decision

making when pricing and producing distillers grains.


DISTILLERS GRAINS. BY MICHAEL TAY

Contribution


market pricing for ethanol plant coproducts. To maximize gross revenue, plant managers can use a dryer model (including auxiliary equipment tied to the production of dry or wet distillers grains) to gauge the amounts of dry distillers grain with solubles (DDGS) and wet distillers grain with solubles (WDGS) they should produce at specifi c prices. Alternately, they can determine what the market price for wet distillers grains needs to be in order to make produc-ing wet grain more attractive than producing dry stillage.

Laying Out the ProcessDry mill ethanol plants that

produce DDGS operate using a variety of process confi gurations with the most common industry layout using two rotary dryers in series. Other layouts may require fl ash- or steam-tube dryers. As a general rule, plants use from one to four dryers, depending on dryer and plant design and capacity.

In plants using two rotary dryers, producers have the ability to make from zero to 100 percent DDGS. The remaining distillers

grains will become wet or modi-fi ed product, where modifi ed is a combination of centrifuge wet-cake, concentrated stillage syrup and partially dried product. DDGS is comprised of 10 to 15 weight percent water, and WDGS is 45 to 55 weight percent water.

The percentage of grain a plant operator decides to dry is based on orders from the com-modity manager, who is selling both WDGS and DDGS. Order

volume is determined by both product demand and market pric-es.

Consider the following ex-ample. The key performance indi-cator calculation sheet (see graphs on page 94) shows the impact on revenue as operators adjust screw speeds for wet-cake, partially dried-cake and syrup on a wet-pad screen in order to increase or decrease the tons per hour of WDGS produced. The calcula-

tions show the plant manager his estimated production revenues (in tons per hour multiplied by dollars per ton) of WDGS, DDGS and ethanol. Net gross profi t (operat-ing margin) also is shown. This is calculated by subtracting ongoing production costs from corn, natu-ral gas, enzymes, water, electricity and other direct costs of produc-tion.

The graphs show that etha-nol production has remained fairly

Pro-Environmental, Inc.Thermal and Catalytic Oxidizers for VOC/HAPS Control Made In America

• Leading supplier of custom oxidation systems for control of VOC, HAPS and odorous emissions

• Our designs are based on the “best solution” for your application• Aftermarket services for parts, upgrades, rebuilds, testing and on-site service

Product Offerings Include:• Regenerative Thermal Oxidizers

(RTO)• Regenerative Catalytic Oxidizers

(RCO)• Recuperative Oxidizers• Direct Fired Oxidizers

Aftermarket Services:• Emissions Source Testing• Equipment Rebuilds/Upgrades• Field Service Technicians

Available 24/7• Spare Parts In Stock

Visit us online: www.pro-env.comE-mail: [email protected]

Pro Environmental, Inc.Rancho Cucamonga, CA909-989-3010

Beer Column

Whole Stillage

Centrifuge Feed Wet Cake Pad

Syrup Tank

Syrup Tank

Thin Stillage

Steamor

Vapor

A number of dryer confi gurations are used, with the most common in the U.S. industry being two rotary dryers in series. Other layouts may require fl ash- or steam-tube dryers. SOURCE: PAVILION TECHNOLOGIES


DISTILLERS GRAINS. BY MICHAEL TAY

Your Trusted Margin Management PartnerWith our long history spanning nearly a century in the agricultural and energy industry, Gavilon is a trusted partner when it comes to renewable fuels. We offer unparalleled scale, scope and capability in feedstock procurement, along with physical distribution and merchandising of agricultural and energy products. Backed by our fi nancial strength, industry expertise and robust economic research group, you can trust Gavilon to support your business. Let us simplify your complex risk management and logistical challenges with an integrated solution to help you maximize margins today.

L O G I S T I C S

M A R K E T I N G

M A R G I N M A N A G E M E N T

www.Gav i lon . com 402.889.4300

stable over this time. However, as the screw conveyor settings are shifted to make varying amounts of wet product, estimated WDGS and DDGS revenues also shift. In the short period trended in the example, the last third of the production is most notable. WDGS production is highest during this period, and as a result, net operating margin drops sig-nifi cantly. This decline indicates that rather than the cost savings intended by producing more wet product, the change in operation actually decreases overall gross margin.

The reasons for negative impact vary, but the ultimate cause is a pricing imbalance. Pricing for WDGS per ton, when compared to the equivalent DDGS that would have been made, minus the costs of drying this additional product, was unbalanced. In this case, the commodity manager priced the WDGS too low, so when the plant produced additional wet stillage, the producer lost money. The producer should have contin-ued to make dried product instead of wet.

Rotary Dryers: Fully LoadedAvoiding this problem sounds fairly

simple—either increase the price of WDGS compared to DDGS, or don’t sell the WDGS. But unfortunately, the effectiveness of the producer’s dryer performance adds a number of complexities that make the so-lution far from simple. In our example, the producer used rotary dryers. With this type of dryer, actual effectiveness of drying de-pends on a number of variables, including moisture content, air temperature, air hu-midity, air fl ow rates, feed water content and dryer loading (or bed level).

Looking at a single variable on its own—dryer loading, for example—showcases the complexity of building an accurate model to determine ideal production levels. In dryer loading, load level has a nonlinear impact on drying effi ciency, and producers should seek an ideal full load where solid stillage level fi lls the maximum fl ight angle with the best air/solids interaction. (See Keey, R. B., “Dry-ing of Loose and Particulate Matter,” 1992 Hemisphere Publishing.) At this angle, dry-ing air fully interacts with the maximum sur-

Real-time calculation of product revenues and operating margin per hour calculated as amounts of wet and dry distillers grain production is varied. SOURCE: PAVILLION TECHNOLOGIES


face area of the stillage, which maximizes the effectiveness of the dryer. If the full load is decreased, extra hot air bypasses the stillage, negatively impacting effectiveness. Similarly, increasing the full load increases the “to-be-dried” stillage level, but doesn’t add drying surface area, thus limiting effectiveness.

In the example case, there is an ideal load size, but there are two dryers in se-ries, so determining the ideal load becomes slightly more complex. Either one dryer is ideally loaded and the second less than op-timally loaded, vice versa, or some sub-op-timum loading level is averaged across the two dryers. When a dryer is sub-optimally loaded, the producer spends more money per ton of product dried. As a result, the relative costs to dry or not dry another ton of distillers grains vary any time the loading level is changed.

Each variable in the dryer performance model represents a new and different set of challenges, and dryer loading is only one such example. Despite the varied complexities, it’s possible to create a nonlinear dryer perfor-mance model that includes key parameters related to dryer performance.

An Added Complexity: RFS2So far dryer optimization is dependent

on two factors—developing a suffi ciently accurate model of available drying operating handles and equipment performance, and identifying current market pricing drivers for the business. The U.S. EPA’s revised renew-able fuel standard (RFS2) and other similar legislative drivers may add complexity by mandating GHG emissions regulation.

RFS2, for example, is anticipated to re-ward producers with renewable identifi cation number (RIN) credits who dry 50 percent or less of their distillers grains. Given the regulation, the pricing difference between WDGS and DDGS is one decision driver, but there is an added penalty consideration if the plant will be within bounds for RIN credits at 50 percent dried production and out of bounds at 51 percent.

Mathematically, there are two ways for producers to simplify the issue. The simple

way, and probably the easiest way from an an-ticipated reporting perspective, is to constrain or limit the economic optimizer at 50 percent, or at whatever the documented pathway or al-lowable operating limit is set. In this case, the optimizer would not violate the set limit, even when it may be temporarily opportunistic to make more DDGS.

Another more mathematically elegant solution that is more complex in terms of re-porting requirements is to add an additional economic penalty to the optimizer that is equal to the value of the RIN credits. With a penalty in place, the mathematics would allow the pro-ducer to decide when it makes economic sense to exceed a 50 percent limit—even though it may include the loss of prospective RIN cred-its on a fraction of production.

While the elegant solution is interesting from a mathematical and hypothetical perspec-

tive, the simpler solution makes more sense in the real world. The same model can be exer-cised within a variety of scenarios and used to determine when changes to permits and al-lowable operating conditions are needed.

However, in day-to-day plant operations, decisions regarding how to run on a given day are constrained within the capabilities of the plant’s current equipment and operating per-mits. Nevertheless, signifi cant savings—on the order of 3 to 5 percent increased operat-ing margins or more—may be realized using model-based optimization based on current economics to support operating decisions. EP

Michael Tay is manager sales engineering for Pa-vilion Technologies, a Rockwell Automation Com-pany. Reach him at [email protected] or (512) 438-1482.

877.854.2507 toll [email protected] · hemcoepm.com

2408 KarbachHouston, Texas 77092

GANGWAYS

ACCESS RAMPS

LOADING RACKS

LIFELINES

HOSE & LOADING ARMS

SAFE ACCESS FOR LOADING TRUCK AND RAIL CARS

Loading operators, project engineers, and plant management all know how important safety is to us at HEMCO. Our safety record proves they can rely on us for fall protection from accidents. Because we’ve been there for you since 1956, we’ll be there for you tomorrow.


The latest strategies for managing mar-gins, managing idled and distressed plants, and maximizing RINS were discussed by panelists and attendees during the Management/Busi-ness track sessions at the 26th Annual Fuel Ethanol Workshop and Expo held in St. Louis in June.

In a session titled “Boardroom Leader-

ship and Plant Strategies,” attendees heard in-dustry experts describe the latest strategies on managing staff, commodities and fi nancial risk to prevent balance sheet erosion, and received advice and guidance on how members of the board of directors can utilize these tools to discharge their obligations. The panelists’ pre-sentations were excellent and the audience was

engaged during the Q&A session. Most of the questions focused on the structure, workings and obligations of the board of directors.

In the ethanol industry, now more than ever, each producer must strive to be the low-est cost/most effi cient, employ strategies to protect margins, build favorable cash fl ow and protect balance sheets. Given price volatil-

FEW Features Board Management StrategiesFocusing on the bottom line and hiring good managment are only a few of the duties and obligations of a board of directors.


BOARD MANAGEMENT. BY DAVID A. CRASS AND ANNA J. WILDEMAN

Contribution


ity of both corn-based ethanol’s feedstock and products, there is in-credible competitive pressure to maximize operational effi ciency with feedstock, energy use, coproducts, person-nel, market partners and fi nancial planning. Op-erations that win will be those that minimize the cost of turnover, protect their balance sheets by actively deploying all the tools available for risk management (commodi-ty risk and fi nancial risk), stay abreast of evolving technologies and the opportunities that these technologies present, and take appropriate manage-ment and legal steps to minimize liabilities.

Given these indus-try challenges and op-

portunities, a brief summary of the board of directors’ duties is in order. The board’s purpose is to oversee the management of the company by:

Reviewing and monitoring the com-pany’s fi nancial and operating performance

Setting its vision and developing poli-cies and strategies to attain that vision

Hiring, setting goals for and evaluating the company’s chief executive offi cer

Overseeing risk management and fi -nancial management strategies

Developing and implementing suc-cession plans for both management and the board itself.

The division of power between the board and the management team will be defi ned in a company’s governing documents—articles of incorporation and bylaws. Regardless of the governance structure of a corporation, effective communication between the board and the management team is essential to ef-fectively manage legal and operational risk and evaluate the fi nancial and operational position of the company.

As a general matter, each board member has the following legal obligations:

Duty of Care or Diligence Directors must discharge their duties in good faith, with care that an ordinary prudent person in a like position would exercise under similar circum-stances, and in a manner reasonably believed to be in the best interests of the corporation.

Duty of Loyalty Directors must refrain from engaging in personal activities in such a manner as to injure, take advantage of or confl ict with the company. Many companies develop and implement an internal confl ict of interest policy to help defi ne the scope of this duty.

Duty of Compliance Directors must discharge their duties in compliance with the law and the articles of incorporation and bylaws. To discharge this obligation, a board must fully understand what law applies to its actions. The law governing a board’s actions

WASTE NOTHING

Environmental Systems

815.455.4100 EISENMANN.com/wastenothing

We can lower your cost per gallon, improve your plant operability and reduce your carbon footprint

As crude oil continues to spew from the bottom of the Gulf of Mexico and prosecutors begin to talk of criminal charges against corporate offi cials, members of boards of directors are reminded to take their role seriously.

David A. CrassAgribusiness, food processing and distribution group chairMichael Best & Friedrich

Anna J. Wildemanland, resources practice groupMichael Best & Friedrich


BOARD MANAGEMENT. BY DAVID A. CRASS AND ANNA J. WILDEMAN

should be identifi ed in the company’s articles of incorporation or bylaws, or will otherwise be defi ned by state law.

Duty of Disclosure Directors must dis-close to other directors and shareholders ma-terial facts within their knowledge. This dis-closure should be carefully coordinated with the management team and with legal counsel.

Fiduciary Duty In addition to all of the above, directors have a general fi duciary duty, which requires them to act in the best interests of the company. This duty requires directors to act in good faith on all occasions and give conscientious care and best business judgment to their tasks. A director’s special skills, background or expertise may affect the expected performance and degree of fi du-ciary duty of that particular director. For ex-ample, a director who is also an attorney or an accountant—even though they do not pro-vide professional services for the company—would likely be expected to identify potential legal issues or accounting concerns that arise

during the course of discharging their duties as a director.

Director LiabilityAs crude oil continues to spew from

the bottom of the Gulf of Mexico and prosecutors begin to talk of criminal charg-es against corporate offi cials, members of boards of directors are reminded to take their role seriously. The scope of board member liability can be defi ned by state law, as well as the company’s articles of incorpo-ration and bylaws. Typically, director liabil-ity will arise from breaches of any of the duties noted above, authorization of unlaw-ful dividends or distributions, or failure to comply with applicable federal and state laws, including Securities and Exchange Commission disclosure requirements.

When liability concerns arise, actions of the board as a whole are generally ana-lyzed. However, a director’s special knowl-edge may require liability to be determined

on an individual basis. For example, a di-rector who is also a securities analyst and investment portfolio manager should have a better understanding of a company’s in-trinsic value than most other directors. With such special knowledge, that director may be expected to review a proposed takeover price with greater scrutiny and counsel the board if the proposed price appears inad-equate.

Although directors can be held per-sonally liable for damages that result from breaches of their duty of care and loyalty, they can also be protected by the “business judgment rule,” which serves to reduce li-ability exposure of directors to claims for mismanagement and breach of their fi du-ciary duty of care. The business judgment rule creates a presumption that in making a business decision, the directors of a com-pany acted on an informed basis, in good faith and in the honest belief that the action taken was in the best interest of the compa-


ny. Courts generally do not review the quality of a board’s business decisions, only that required procedures were fol-lowed in reaching those decisions and that the board undertook a good-faith effort to inform itself and rely on facts, information and opinions generated during a reasonable business inquiry. Courts are more inclined to fi nd per-sonal liability when directors engage in gross negligence or obviously demon-strate a prolonged failure to participate diligently or to exercise oversight and supervision.

Additional liability protections may exist for directors, including state law limits on liability, indemnifi cation and insurance. A majority of states allow articles of incorporation to ex-pressly limit director liability in some circumstances. These limits typically apply only to monetary liabilities to the corporation and its shareholders, and not to injunctive relief or monetary liability to third parties. A majority of states also specify the circumstances when a company will be required, or permitted, to indemnify directors against liability. Mandatory indemnifi -cation typically arises when a director is wholly successful in defending its actions in court; permissive indemnifi -cation can arise if a director acted in good faith and with reasonable belief the actions were in the best interest of the corporation. Director and offi cer insurance policies are intended to cover a company for certain indemnifi cation payments required by law or by articles of incorporation.

Despite the potential limits on director liability, no protection is fool proof and directors must remain vigi-lant. The increased attention from the public on corporate activities and the increase of shareholder lawsuits against failing investments during this

economic downturn makes it more impor-tant now than ever for directors to ensure they are diligently discharging their obliga-tions, seeking out and obtaining the type of information and advice necessary to make decisions and are otherwise actively in-volved in developing the strategies that the management team can pursue to discharge the vision and mission of the company. EP

David A. Crass is chair of Michael Best & Friedrich’s Agribusiness, Food Processing and Distribution Group and a leader in the fi rm’s renewable energy practice. Reach him at (608) 257-3501 or [email protected]. Anna J. Wildeman is a member of the Land and Resources Prac-tice Group where she assists both buyers and sellers in assessing environmental issues. Reach her at (608) 283-0109 or [email protected]


EPM MARKETPLACE

Ag Products & ServicesEquipment

Associations/OrganizationsGrowth Energy202-545-4000 www.growthenergy.org

Red River Valley Clean Cities651-227-8014 www.CleanAirChoice.org

Clean Cities

Twin Cities Clean Cities Coalition651-223-9568 www.CleanAirChoice.org

ChemicalsAnti-Microbial

Ferm Solutions859-402-8707 www.ferm-solutions.com

Desiccant

Interra Global847-292-8600 www.interraglobal.com

Enzymes

CTE Global, Inc.847-564-5770 www.cte-global.com

Novozymes919-494-3101 www.novozymes.com

Yeast

Ferm Solutions859-402-8707 www.ferm-solutions.com

Martrex,Inc.952-933-5000 Ext 18 www.martrexinc.com

CleaningDryer Systems

Hydro-Klean, Inc.515-283-0500 www.hydro-klean.com

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

Seneca Companies800-369-5500 www.senecaco.com

Ductwork


Emergency Spill Response



Evaporators



Fans



Filter Media


Heat Exchanger



Hydro-Blasting


Industrial Cleaning

Done RightSpecialty line cleaning

Waste Transporation

Ultra-High Pressure Hydro-Blasting (40,000 psi)

Custom Designed Waste Reduction Programs

Zac [email protected]

313-841-5800 24-Hour Service: 800-992-9118

www.iisgllc.com

Reach your customers

Your Solution. Advertise Today.

EPM MARKETPLACE

EPM MARKETPLACE

With all contact information placed in one convenient location, Ethanol Producer Magazine not only contains top editorial content but also a useful directory in each publication. Whether a fi rst-time advertiser wanting to raise awareness of your business or a fre-quent display advertiser looking for added exposure, EPM Marketplace is the perfect solution.


EPM MARKETPLACE

Plate-Frame


Railcar Spill Response


Railcars


Scrubbers


Smoke Stack


Tank Cleaning Equipment

Cloud/Sellers Cleaning Systems800-234-5650 www.sellersclean.com

Gamajet Cleaning Systems Inc877-GAMAJET www.gamajet.com

Tank Cleaning Services



ConstructionFabrication

Agra Industries, Inc.715-536-9584 www.agraind.com

Andy J.Egan Co.616-791-9952 www.andyegan.com

Plant Construction


Railroad Tracks

Tanks

ATEC Steel620-856-3488 www.atecsteel.com


J.C. Ramsdell Enviro Services, Inc.877-658-5571 www.jcramsdell.com

Westmor Industries320-589-2100 www.westmor.biz

ConsultingEnvironmental

Aquaterra Environmental Solutions, Inc.877-913-8200 www.aquaterra-env.com

Cantley Inc.865-360-4080

Golden Specialty888-472-9898 www.goldenspecialty.com

ICM, Inc.877-456-8588 www.icminc.com


Feasibility Studies

Harris Group Inc.206-494-9422 www.harrisgroup.com

Management Services


Plant Optimization



Project Development


Safety

Rail Safe Training, Inc.712-212-4145 www.railsafetraining.com

EmploymentRecruiting

S.E Weinstein Company800-258-1701 www.seweinstein.com

SearchPath of Chicago815-261-4403, x100 www.searchpathofchicago.com

RenewableEnergy-Careers.com815-261-4480,x111 RenewableEnergy-Careers.com


EPM MARKETPLACE

EngineeringDesign/Build


Process Design

ADF Engineering Inc.937-847-2700 adfengineering.com


Process Design-Cellulose

Equipment & ServicesAnalytical Instruments

Perten Instruments, Inc.801-936-8165 www.perten.com

Biogas Scrubbers

Eco-Tec, Inc.905-427-0077 www.eco-tec.com

Blowers & Fans

FlaktWoods716-845-0900 www.fl aktwoods.com

Centrifuges

Aaron Equipment630-350-2200 www.aaronequipment.com

Control Systems



Kahler Automation Corp.507-235-6648 www.kahlerautomation.com

Conveyors–Drag

Intersystems800-228-1483 www.intersystems.net

Conveyors–Mechanical

Superior Industries320-589-2406 www.superior-ind.com

Cooling Towers

Delta Cooling Towers, Inc.800-BUY-DELTA www.deltacooling.com

Corn Oil Recovery


DDGS Diesel

Total-Yield Diesel from Distillers402-640-8925 www.total-yield.com

Distillation Equipment

SRS Engineering Corpration951-526-2239 www.srsbiodiesel.com

Dryers-Fluid Bed

Buhler Aeroglide919-851-2000 www.aeroglide.com

Dryers-Rotary Drum


Dryers-Rotary Steam Tube


Quality Kiln and Dryer Inc318-335-2001 www.qualitykilnanddryer.com

Fermentors

WINBCO Tank Company641-683-1855 www.winbco.com

Filtration Equipment

Fluid Engineering814-453-5014 www.fl uideng.com

Fractionation-Corn

Buhler Inc.763-847-9900 www.buhlergroup.com/us

Cereal Process Technologies217-779-2595 www.cerealprocess.com


Grain Handling & Storage


Instrumentation


Insulator

Miller Insulation Co., INC701-297-8813 www.millerinsulation.com

Laboratory-Equipment


Laboratory-Testing Services

Midwest Laboratories, Inc.402-829-9877 www.midwestlabs.com

Loading Equipment

Determan Brownie, Inc.800-835-6074 www.determan.com

Maintenance Software


Millwright


Industrial Services


Waste Transporation




313-841-5800 24-Hour Service: 800-992-9118

www.iisgllc.com

Custom Rotary Driers for DDGS & Biomass Feedstocks

With rotary drying technology by Ronning Engineering

www.aeroglide.com/ethanolor call +1 919-851-2000


EPM MARKETPLACE

Moisture Analyzers


Molecular Sieves

Grace Davison Renewable Technologies410-531-8731 www.gracebiofuels.com


Parts & Services


Process Control


Productivity Enhancements


Pumps

PeopleFlo Manufacturing847-929-4774 www.peoplefl o.com

QA Test Products


Structural Fabrication


Tanks

ATEC Steel620-856-3488 www.atecsteel.com


Spokane Industries Inc.509-921-8868 www.spokanemetalproducts.com

Thermal Oxidizers

Wastewater Treatment Services

ADI Systems Inc.1-506-452-7307 www.adisystemsinc.com



Water Treatment

H2O INNOVATION763-566-8961 www.H2OINNOVATION.com

FinanceAppraisals

Natwick Associates Appraisal Services800-279-4757 www.natwick.com

Due Diligence


Insurance

ERI Solutions, Inc.316-927-4294 erisolutions.com

Mergers & Acquisitions

Moglia Advisors847-884-8282 www.mogliaadvisors.com

Legal ServicesAttorneys

WOHLSIFER & ASSOCIATES, P.A.850-219-8888 www.wohlsifer.com

MarketingFuel Ethanol

CHS Renewable Fuels651-355-6271 www.chsinc.com

Market Data

Miscellaneous

Maas Companies507-424-2640 www.maascompanies.com

Research & DevelopmentEngine Testing

Roush Industries734-779-7736 www.roush.com

EPM MARKETPLACE

With all contact information placed in one convenient location, Ethanol Producer Magazine not only contains top editorial content but also a useful directory in each publication. Whether a fi rst-time advertiser wanting to raise awareness of your business or a fre-quent display advertiser looking for added exposure, EPM Marketplace is the perfect solution.

[email protected]

PROVENRELIABILITYfor VOC, CO & PM

ABATEMENT

EISENMANN CorporationCrystal Lake, Illinois

Industrial Safety


Waste Transporation




313-841-5800 24-Hour Service: 800-992-9118

www.iisgllc.com


EPM MARKETPLACE

www.ethanol-jobs.com www.ethanol-jobs.com www.ethanol-jobs.com www.ethanol-jobs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.co

m w

ww

.ethan

ol-jo

bs.com www.ethanol-jobs.com www.ethanol-jobs.com www.ethanol-jobs.com www.ethanol-jobs

.co

m w

ww

.eth

ano

l-jo

bs.

com

ww

w.e

than

ol-

job

s.co

m w

ww

.eth

ano

l-jo

bs.

com

ww

w.e

than

ol-

job

s.co

m

ww

w.e

than

ol-

job

s.co

m

ww

w.e

than

ol-

job

s.co

m w

ww

.eth

ano

l-jo

bs.

com

ww

w.e

than

ol-

job

s.co

m

Reach your customers

Your Solution. Advertise Today.

EPM MARKETPLACE

TransportationMarine

Odin Marine, Inc.203-969-3400 www.odingroup.com

Rail

Ameritrack RailRoad Contractors, Inc.765-659-2111 www.ameritrackrailroad.com

Rail Consulting

Rail Safe Training, Inc.712-212-4145 www.railsafetraining.com

Railcar Gate Openers

The Arnold Company800-245-7505 www.arnoldcompany.com

Biomass Magazine is a trade journal serving companies that use and/or produce power, fuels and chemical feedstocks derived from biomass. Collectively, these biomass utilization industries are positioned to replace nearly every product made from fossil fuels with those derived from plant or waste material. The publication covers a wide array of issues on the leading edge of biomass utilization technologies, from biorefining, dedicated energy crops and cellulosic ethanol to decentralized power, anaerobic digestion and gasification. It’s all here.

www.BiomassMagazine.com

For additional informationplease contact us at (701) 746-8385 or at [email protected].

Renewable Energy Solutions

November 2 - 4, 2010Hyatt Regency AtlantaAtlanta, Georgia

www.biomassconference.com/southeast

With an exclusive focus on biomass utilization in the Southeast – from the Virginias to the Gulf Coast – the Southeast Biomass Conference & Trade Show is a dynamic regional offshoot of Biomass Magazine’s International Biomass Conference & Expo, the largest event of it’s kind in the world.

www.biomassconference.com/[email protected]

ATTEND.EXHIBIT.SPONSOR.

PACIFIC WEST EVENT

January 10-12, 2011Sheraton Seattle HotelSeattle, Washington

EST

uarrato

Sea

T

12Ho

ngt

CIF

J , 2l

n

www.biomassconference.com/pacificwest

Date post:	29-Mar-2016
Category:	Documents
Upload:	bbi-international
View:	220 times
Download:	2 times

August 2010 Ethanol Producer Magazine

Documents