Biodiesel’s Cutting Edge

Biodiesel Magazine profiles nine companies whose process technologies, products and services are on the frontline of change in this industry.
By Ron Kotrba | December 28, 2018

Third Coast Commodities
Biodiesel feedstock trading is evolving, and Third Coast Commodities is one of the firms ushering in this change. “We view taking directional positions for clients or vendors—at either parties’ expense—as the past business model, one that’s going to ultimately fail,” says Nicholas Hoyt, head of risk management for Third Coast Commodities. “The word trading implies taking positions, but that’s not what we do.”

Hoyt says the focus of a feedstock service provider should include providing opportunities to mitigate risk and capture margins when they exist. “We want to dispel the whole notion of trading against price,” he says. “Much of the industry’s pricing mechanisms are backward-looking and nontransparent. ‘This index reports today that the price on used cooking oil last week was plus or minus this or that.’ The truth is that today’s price is today’s price—it’s what someone is willing to pay.” The only way to improve the pricing and contracting models, Hoyt says, is to bring transparency to the market.

One important aspect of effective risk management is leveraging historical data. Aggregating, and perhaps more importantly, understanding that data to help customers is critical in today’s environment. “We take all this information to make better decisions for our clients,” Hoyt says. “Our goal is to bring market price transparency to our clients so they can maximize their business margins and best execute logistics. We use the data to understand price relationships over time.”

Hoyt says when it comes down to it, there isn’t a single byproduct or coproduct for which any feedstock provider is going to slow down their core business operations. “Ultimately, they have to move these fats, oils and greases,” he says. “What we do is understand those trends and get the best price as of that day, as efficiently as possible to ensure maximizing revenue. Understanding historically where those price relationships are with supply and demand helps our vendors and customers capture the best prices, so they can focus on the daily challenges of execution.”

Hoyt says Third Coast Commodities is implementing a blockchain-type approach to the business. “What blockchain does is provide verification of what the product is, where it came from and where it ended up,” he says. “For us, it’s the process of verifying where in the value chain the product is at all times.” Third Coast Commodities is actively working to bring blockchain technology to the business through the Canadian startup Grain Discovery, which was scheduled to execute its first trades in coffee and soybeans in December. Examples are food companies using blockchain to ensure waste products are being disposed of in the proper way, source verification, chain of custody and more. “All forms of sustainability certifications in the biofuels industry use a basic form of blockchain technology,” he explains. “When we make a trade, we track all that data, tying invoices to product weight, FFA content—hundreds of data points per transaction. Then we clean up the data and put it in a usable form to help our clients.”

Another important aspect of the service Third Coast Commodities provides to its clients is working to control transportation costs and executing on-time deliveries. “Third Coast Commodities has worked with more than 300 trucking companies across North America,” Hoyt says. “We know those that run most efficiently and on time. We take all that information and use it to pair them appropriately with our individual client’s needs. The way this works is through steady communication and anticipating where the likely problems will arise. It’s another level of service we provide.” He adds that, in addition to trucking, the company will have moved more than 300 railcars in 2018. “We have recently added a storage and transload facility in Indiana,” he says. 

Transportation is Third Coast Commodities largest expense, and with the current driver shortage it makes servicing suppliers and customers a challenge on most days. “Transportation costs continue to increase, with customer service declining,” Hoyt says. “We recognized that we needed to respond by starting Ag Energy Transport, a specialized tanker company to not only service Third Coast Commodities, but to strategically utilize our long-term relationships with our suppliers and customers to help manage their transportation needs.” This will result in reducing empty miles and increasing profitability, becoming a value add to its customers. “Currently we are operating four tankers in the Midwest and southern states,” he says. “We anticipate layering another 12 tankers in 2019.”

Ultimately, Third Coast Commodities’ focus is on being a quality service provider and cost manager. “We’re all going to have costs,” Hoyt says. “But as we grow, we are aiming to provide more opportunities like risk management practices for our clients to ensure they can capture the best market price or margin available. We want to be that service provider in the middle, so everyone can better manage their business. We are about transparency and service, and executing logistics flawlessly. The best compliment our clients can give us is referrals. Our business is built around referrals, so our goal is to continue developing referral business. To this point, our business is built on the back of those compliments.”

Packaging the highly variable process of retrofitting disparate biodiesel facilities with unique operations into an executable program for the industry requires mastery gained over decades. This is precisely what Austria-based BDI-BioEnergy International GmbH has done with its RetroFit Program. BDI has performed dozens of retrofit projects around the world. “Each retrofit project is always unique,” says Hermann Stockinger, BDI’s vice president of global sales. Christine Riedl, BDI’s technical sales manager, says customers engage BDI for retrofits to increase profitability, capacity, energy efficiency, product quality and yield; and to modernize their process and utilize waste materials as feedstock. She says retrofits involve much more detailed discussions than greenfield builds. Safety standards, which vary by law and from one company to another, must also be considered early on.

BDI’s RetroFit Program comprises eight steps, beginning with an evaluation of the existing plant, customer requirements, a rough cost estimate, preliminary concept preparation and summary of results and recommendations. Next is pre-engineering, including feasibility and mass balance studies, layout planning, integration and interface management. Third, an offer is made with scope of work and detailed costs, followed by the authorization procedure, which includes data preparation for permitting, assistance and risk analyses such as HAZOP studies. Steps five through eight are engineering and delivery; implementation; commissioning; and aftersales service.

The customized optimization of BDI’s retrofits often involves integration of a proprietary pretreatment process to remove feedstock impurities and a biodiesel distillation column to meet stringent fuel specifications. In its RetroFit Program, BDI also offers a patented esterification process for high free fatty acid (FFA) feedstock, as well as glycerin distillation to achieve technical- or USP-grade glycerin. In many instances, BDI is approached to improve a facility’s energy efficiency, which begins with installation of an economizer. The return on investment (ROI) for energy efficiencies is measured in months while, for a complete retrofit, an ROI of two to three years is commonly requested, Stockinger says.

Another cornerstone of BDI’s biodiesel offerings is its multifeedstock technology, elements of which are utilized in its RetroFit Program. “We have different solutions for various processes,” Stockinger says. “Based on that, we take out separate units or technologies and select the right ones for our customer’s retrofit project. You need complex and comprehensive knowledge of biodiesel processes, in general, and quite a lot of experience in what to do in certain situations. What we provide our retrofit customers is based on that huge set of knowledge.” 

In addition to knowhow, what makes a project successful is brainstorming, communication and discussion from different expert points of view. “The North American market is quite interesting for us,” Stockinger says. “Our customers there are very open to discuss their requirements with us. We appreciate the level of experience they have.” Riedl says she enjoys working with North American customers because they are goal-oriented. “They focus on solving the main problems first, and afterwards discussing the ‘color of the pump’,” she says. U.S. customers want problems solved quickly and properly, Stockinger says. “It’s a good approach,” he says. “The challenge in the U.S. is the ROI must be quicker too.” 

Leem Filtration
Leem Filtration has been servicing the biodiesel industry for 10 years and has been in business since 1962. After supplying the corn sweetener, sugar, edible oils and used cooking oil industries with filters for decades, moving into the biodiesel space was a natural fit, says Bill Boyd, sales manager for Leem Filtration, who has been in the filtration business for 26 years. “We do a lot of business in biodiesel,” Boyd says, “and we do a lot of business in other industries whose products wind up in biodiesel plants.”

Filtration is often a coupling of physical filters with filter aids such as diatomaceous earth (DE), or other adsorbents. “The adsorbents are put into the product and our filters physically take the adsorbents and impurities out,” Boyd says.

The pressure leaf filter is a common fixture in biodiesel plants and it’s one in which Leem Filtration specializes. “We offer different styles of pressure leaf filters,” Boyd says. “The differences are based on size and orientation—vertical or horizontal—depending on throughput needs and what kind of footprint the plant can sustain.” Boyd says Leem Filtration’s vertical pressure leaf filter is the most popular application for biodiesel. “Many biodiesel producers used horizontal filters early on, but they later found vertical filters work better and take up less space,” he says.

Leem Filtration offers a range of filter sizes, from as small as 50 square feet up to 1,275 square feet for vertical filters, and from 300 square feet to 1,650 square feet for horizontal ones. Boyd says many plants run filters in tandem. “We just did a big project in Texas that used four big verticle filters,” he says. “Others I’ve worked on have run eight to 10 vertical filters stacked.” He says all of Leem Filtration’s filters feature 80-micron pore sizes, often which are then precoated with DE or another adsorbent to help filter down to 0.7 microns.

One particularly unique offering Leem Filtration provides is a welded design. “The standard pressure leaf filter portion that holds the precoat is riveted in five plies,” Boyd says. “A number of years ago we came up with a welded design that eliminates rivets, which reduces the chance of leaks. It uses a wedge wire core in the center so it doesn’t plug up in the center of the leaf. It works particularly well for animal fats and other products that tend to clog up the center of the leaf. No one makes this but us.” He says Leem Filtration is also a wedge wire company, so it makes its own core for this application. “To our knowledge, we’re the only one who can make that core,” he says.
In addition to filters, Leem Filtration also provides structural steel, walk-around platforms, precoat and feed tanks. “Previously, if we put in a filter system, the customer would have to buy the feed or precoat tank somewhere else,” Boyd says. “Instead of going to different places to get them, we can now provide them as one unit. It allows us to provide more of what our customers need.”

Jatro Renewables
In January 2018, Raj Mosali, co-founder and CEO of Jatrodiesel, reorganized his company and rechristened it Jatro Renewables Inc. to better fulfill his vision and adapt to the changing biofuels business model. “My vision is to be a full-service provider, not just a process technology provider,” Mosali says. “Due to our 15-plus years of experience in the biodiesel area, apart from our core competency in biodiesel and supercritical processes, we gained valuable expertise in other areas such as operations, feedstock procurement, product sales, process scaling and more.” Mosali says he would like to leverage this expertise in other related areas, including renewable diesel, higher-efficiency extractions and more. He highlights Jatro Renewables’ robust R&D and partnerships, and says he is working on commercializing newer technologies to be unveiled soon. “The biodiesel industry is fairly mature but also changing,” he says. “The demand is slowly climbing, but also the need for better and higher-efficiency extraction procedures is going up, which will eventually lead into relooking at alternative feedstocks or alternative ways to produce biofuels. We want to be at the forefront of this.”

Mosali is no stranger to being at the forefront of alternative technologies. In 2013, Patriot Renewable Fuels contracted Jatrodiesel to build a first-of-its-kind supercritical biodiesel plant scaled at 5 MMgy co-located with its 125 MMgy ethanol plant in Annawan, Illinois. Since then, CHS Inc. bought the complex and commissioned the plant in late 2015. The startup was a milestone but did not come without its problems.

“There were a few unanticipated and hard technical issues that we had to overcome,” Mosali says. “The relatively easier fixes were in the supercritical process itself. Working closely with CHS and Green Tech Solutions, our Japanese partner who owns the original patents on supercritical biodiesel, and tapping their expertise was helpful. CHS’s support and contribution to the effort have been priceless and went beyond a traditional vendor-customer relationship. I would term this as a success for both Jatro Renewables and CHS.” CHS is now operating the plant 24/7 in Annawan, Illinois.

Jatro Renewables’ supercritical technology is a single-stage, continuous process that puts no limit on free fatty acids. It cuts the cost of traditional biodiesel refining by 25 percent, Mosali says, in part by eliminating the need for catalysts. Complete conversion takes place in minutes with minimal yield loss, and water has no adverse effect on the process. Mosali says it is operationally efficient and less error-prone. “Operations are easier,” he says, adding that running a supercritical plant is relatively hands-off compared to even the most automated conventional plant. 

The market is looking for high-quality, efficiently produced biodiesel, Mosali says. “Also, the market’s looking for competitively priced product,” he says. “Due to economics, producers have to constantly look for the cheapest feedstock and keep producing high-quality biodiesel efficiently. Biodiesel is now a true commodity in terms of pricing and availability, and technology has to adapt to that.” He adds that the two biggest factors allowing supercritical producers to ride the waves of market uncertainty are the ability to process any feedstock and the lowest per-gallon operational costs. “The lowest-cost operator who is highly efficient will survive,” Mosali says. “Our supercritical technology offers that to the customer.”

PQ Corp.
PQ Corp. is a globally focused specialty chemical company involved in several markets, including oil and gas, food and beverage, and, of course, biodiesel. The company traces its roots to its founding more than 200 years ago in the Philadelphia, Pennsylvania, area where it operated privately for two centuries. In September 2017, PQ Corp. became a publicly traded company with its initial public offering of 29 million shares at $17.50 per share. PQ Corp.’s stock is traded under the ticker symbol “PQG.”

The firm is still headquartered in the greater Philadelphia area but services clients worldwide with a global team of sales, technical support personnel and research scientists. PQ Corp. also supplies its clients from regional manufacturing sites. For the biodiesel industry, PQ Corp. manufactures adsorbents in ISO-certified plants in the U.S., Brazil and the Netherlands and has additional silica manufacturing capabilities in Indonesia and the U.K. Research and development efforts as well as laboratory testing services are provided from both Europe and the U.S.

The company’s family of Sorbsil synthetic silicas are extremely high-purity adsorbents that target the removal of impurities such as soaps, phospholipids and trace metals. This is accomplished through the coupling of a high surface area adsorbent with controlled pore size to maximize the affinity for such polar compounds.

In conventional biodiesel applications, the use of PQ Corp.’s Sorbsil synthetic silicas allows for the processing of multiple, lower-quality feedstocks while extending catalyst life and maintaining, or even improving, glycerin quality. “PQ Corp. does a detailed process review with clients to ensure an optimal technical offering tailored to meet the customer’s specific needs and expectations,” emphasizes Arnd Oppermann, PQ Corp.’s global business director for specialty adsorbents.

John McNichol, PQ Corp.’s market development manager, says the company is extremely energized by the growth potential in biodiesel. “Demand is increasing globally due to both expanded mandates on the use of biodiesel, such as B20 requirements in some countries, as well as a general green movement,” McNichol says. “We have also recently expanded our research and development capability to provide customer support from the R&D center in Conshohocken, Pennsylvania, so as to better meet the needs of a changing market.” Customer service includes the ability to design and support client trials, recommending adsorbent dosages and evaluating product performance, final product quality and filtration characteristics. 

PQ Corp. has supported the biodiesel sector for a decade and is committed to helping the industry grow and prosper. “The industry has certainly grown over the past 10 years and the level of sophistication in processing has greatly increased,” McNichol says. “PQ Corp.’s recent expansion of services confirms our dedication to this dynamic market.”

McNichol notes that in addition to biodiesel, PQ Corp. is also focusing on servicing the renewable diesel industry. Renewable diesel is a diesel fuel substitute made from the hydrotreatment of fats, oils and greases. “The technology has become commercially viable,” he says.

Owned by the Petroleum Marketers and Convenience Stores of Iowa, RINAlliance is a national firm specializing in providing petroleum jobbers and marketers cost-effective solutions for tracking, reporting and managing RIN credits. The company’s proprietary software application assists blenders and RIN owners with reporting RINs to U.S. EPA, performing audits of RIN transactions, and trading RIN credits. “We also work with potential blenders to help them determine whether it makes sense to start blending,” says Reo Menning, executive vice president. “Whether it’s finding biodiesel suppliers, calculating profit margins, pointing out available tax incentives or getting companies registered with EPA, we make it easy to get started.”

When companies are ready to blend biodiesel, RINAlliance guides them through negotiation processes with biodiesel suppliers, ensuring they leverage current RIN prices and available tax incentives in their purchase agreements. “We help negotiate the best deal, looking at the potential for the biodiesel tax credit to return, current RIN prices, how much transportation costs, and whether it makes more sense to buy RINless,” she says. “We walk through all that.” 

RINAlliance recently upgraded its proprietary software to provide customized RIN tracking for business metrics. “Our new software builds in efficiencies for users,” Menning says. “Clients can process dozens to hundreds of blend and sell transactions at a time. They can use the fields to track RIN profitability as well as supply contracts and purchase agreements associated with specific RINs. EPA’s EMTS system doesn’t allow transactions on specific RINs—it picks them based on production date. Our system allows you to buy and sell specific RINs the way you want to.”

The RIN market has been adversely affected this year by small refinery exemptions, driving prices down. “That makes profitability tougher,” Menning says. “Prices have since stabilized a bit, which makes it easier to plan for the future, but we have helped our clients through this time as they transact RINs by getting them the best price out there.” RINAlliance also moves clients’ RIN sales close to the buy time. “That assists with profitability,” she says. “We move them fast. We’re constantly selling.” 

Some pending changes to the RFS program, such as the push for greater transparency in RIN trading, will help, Menning says. Other changes, such as the potential for marketers to sell RINs directly to obligated parties, will make it challenging for aggregators. “Obligated parties aren’t going to want to be RIN aggregators,” she says. “Several ideas have been put out there to consider. They will have to determine which makes sense. The RIN market is more efficient if we have aggregators.”

RINAlliance works with small and large companies alike. “What makes our services so valuable is that for those small companies selling lower volumes, we aggregate RINs and get them a better price,” Menning says. “And they don’t always have staff to do compliance work. For larger companies, our software provides operational efficiency that makes it easier to perform multiple blend-sale transactions at once.” She says RINAlliance’s software makes the entire process more cost-effective, profitable and accurate. “We have many checks and balances to ensure accuracy,” Menning says. “We take regulatory compliance very seriously.”

The keys to success for alternative biodiesel process technologies are widening a producer’s feedstock choices and lowering both capital and operational costs while achieving better product yields and quality compared to conventional techniques. Rahul Bobbili, president and chief technical officer for San Jose, California-based Renewable Process Solutions Inc., says Hybrid.T—a technology he developed combining supercritical and traditional biodiesel processing—can accomplish all this and more. The process builds on RPS’s experience developing a supercritical plant co-located with Calgren Renewables’ ethanol facility in Pixley, California, which is near completion.

With Hybrid.T, producers can process feedstock with up to 20 percent free fatty acids (FFAs). Feedstock is sent through a fat-stripping column and the FFAs are processed in a small supercritical reactor. The converted stream is then fed into a conventional transesterification reactor with the triglycerides. Bobbili says the advantages of Hybrid.T are lower processing and capital costs, lower methanol and sodium methylate usage, higher yields, and no salt deposits, corrosion or high maintenance common with sulfuric acid esterification.

“The crude glycerin is greater than 80 percent pure, and ASTM-spec biodiesel yield is greater than 99.5 percent,” Bobbili says. Acid catalysis puts limitations on FFA consumption, Bobbili says, so people are looking into Hybrid.T to process higher FFA levels at lower processing costs. “That’s key—to produce fuel at the lowest process cost compared to other producers,” he says. “This is where the interest is. When I pitch this to customers, the lower cost of supercritical esterification is always key. Reduced costs will add value to the process.”

Excluding tank storage, civil work and a loadout rack, Bobbili says RPS can supply a 5 MMgy Hybrid.T plant for $6.25 million with a return on investment (ROI) of slightly less than two years. A 10 MMgy plant has an even lower capital expense of $1 per gallon and a faster ROI, he says. RPS can offer greenfield builds, retrofits or co-located Hybrid.T plants. “We work with bolt-on upgrades for biodiesel producers, and we cater to ethanol producers who want bolt-on systems to produce biodiesel,” he says. “The advantage of a Hybrid.T retrofit for a transesterification facility processing pure soybean oil is, if the customer wants to process higher FFA, we can simply bolt on a frontend fat-stripping column and supercritical system that will operate in parallel to their transesterification process.”

RPS also offers prospective renewable diesel producers smaller-scale hydrotreatment technology coupled with a subcritical countercurrent hydrolysis pretreatment step to convert triglycerides to FFA before hydrotreatment. The process removes glycerin at 97 percent purity before hydrotreatment. In conventional renewable diesel production, the unwanted glycerin is converted to propane. RPS’s pretreatment process reduces hydrogen consumption by a third and extends catalyst life “substantially,” Bobbili says, by significantly reducing impurities in the feedstock.

Although a handful of ethanol producers have chosen to co-locate biodiesel processing on-site, Bobbili says many wrestle with the decision whether to install biodiesel or renewable diesel production. Fortunately for them, RPS’s technology suite covers both approaches.

The multinational company Imerys specializes in the production and processing of industrial and advanced minerals. Known throughout the biodiesel industry for its CynerSorb-branded adsorbents, for the past year Imerys has been developing cold filtration solutions for the biodiesel industry using its Harborlite-branded perlite. “Not all producers perform cold filtration,” says Chris Abrams, the commercial development manager for Imerys Filtration. “Some are using additives, others rely on distillation, and some are using multiple approaches. We noticed a trend that, without our knowledge, several biodiesel producers were using Imerys’ Harborlite for cold filtration that they bought from our product distributors.”

Many biodiesel producers doing cold filtration chill the biodiesel temperature to 50 to 55 degrees Fahrenheit and then filter it. “That’s where we are filling most of our perlite in the biodiesel industry,” Abrams says. “They put a base of perlite on the physical filter and run perlite throughout the day. It seems like the market determined on its own how good this product is for cold filtration, prior to us marketing it, so it led us to look into this further.”

Perlite is a mineral formed from volcanic glass and has the remarkable property of expanding up to 16 times its size when heated. Perlite has many uses, including cryogenics and low-temperature insulation. Imerys extracts the material from its U.S. perlite mining operations in Arizona and Colorado, where it is then expanded at one of many expansion plants located throughout the states. Once expanded, perlite has tremendous surface area and porosity, making it a great filtering agent to remove solid contaminants and insoluble impurities out of biodiesel that hinder cold flowability, such as sterol glucosides. Imerys offers multiple grades of expanded perlite under the Harborlite brand.

Synergies are seen when Harborlite perlite is used in conjunction with CynerSorb adsorbents, Abrams says. CynerSorb is a surface-functionalized diatomaceous earth. Conventional diatomaceous earth is used to remove solids. When combined with Imerys’ proprietary adsorbent, the two-in-one product can remove a host of impurities that either product alone would leave behind. “What we’ve found is that the use of CynerSorb in conjunction with Harborlite perlite is shown to improve cold filtration and filter rates in biodiesel,” Abrams says.

In addition, the use of perlite improves the overall production process, according to Abrams, by increasing throughput and decreasing filter downtime. “It does this by opening up the filter,” Abrams says. “Perlite has such a broad selection of permeabilities to fit the size, type and production rate of any filter process. It opens up the bed itself and increases capacity at final chill filtration. It can do that by 20 to 50 percent.” He says Harborlite also decreases filter downtime. “It does this by reducing the overall consumption of filter media,” Abrams says. “You add less and it does more. It can provide a 10 to 30 percent reduction in total solids. And it increases yield because you have less biodiesel going out with the filter cake. Ultimately, the economic value is uptime and increased production.”

Moreover, the use of Harborlite perlite improves the cold soak filtration test by 20 to 30 percent, Abrams says. “If your plant is currently doing cold filtration, independent of what you are using for primary cold flow improvement, you should look at Harborlite perlite for capacity increases, debottlenecking and reduction of overall filter media use in process,” Abrams says. “Every application in which we’ve done this exercise, the outcome has been improved.”

Imerys is interested in collaborating with producers to run trials of Harborlite perlite for cold filtration at their plants.

Smisson-Mathis Energy
A number of jurisdictions are pushing to eliminate the disposal of fats, oils and greases (FOG) in landfills. “Some jurisdictions have already banned land application of this material,” says Ken Brown, CEO of Smisson-Mathis Energy LLC. “And others are looking at capping how much can end up in landfills. Part of our mission is finding better solutions for this material.”

SME, a joint venture between Dublin, Georgia-based Tactical Fabrication LLC and Smisson Energy LLC of Macon, Georgia, is retrofitting an existing, idled biodiesel production facility in Laurens County, Georgia. The innovative process technology couples liquid enzymatic and resin technologies and patent-pending advanced distillation to reduce sulfur from hundreds of parts per million (ppm) in FOG-based biodiesel to near zero. The company is making headway financially and technologically toward its goal of debuting its unique business model and biodiesel process technology in a commercial-scale plant.

Government loan guarantees were more common in the mid- to late 2000s than today, but the failure of Solyndra in 2011 gave them a bad rap after sticking taxpayers with a bill of more than $500 million dollars. “The 9003 program is an arduous program,” Brown says. “It requires us to run a 120-day integrated demonstration unit under the scrutiny of an independent engineer before the loan guarantee is provided. It requires the approval, not only from USDA, but also from the Office of Management and Budget. The most challenging aspect of the process has been the time. It’s been a hard process—but that’s good. We’d like to know the government does the proper due diligence to understand the technology and economics behind these projects before committing its own funds.”

The loan guarantee works as the final backstop if the borrower cannot repay the lending institution. “All the normal collaterals are in place,” Brown says. “Land, personal guarantees—should all that fail, the government guarantees 90 percent of the loan. There has not been a willingness on the part of commercial banks to loan to the biofuel industry in a number of years. This is a mechanism to get back to standard commercial financing. For us, it allows us to use debt and preserve as much equity as we can.”

Brown says SME has raised the equity portion needed per the 9003 loan program requirements and the company is going through the final steps to close on the loan. “We already have a bank that has agreed to provide the funds, and we expect to close soon,” he says. “We have also used our own money to purchase the facility in East Dublin, Georgia. We own the land, building and a majority of the equipment needed to build this plant. We’ve already begun some construction, funding this out of our own pockets while we wait for the loan to close with the loan guarantee. In addition, we’ve already ordered a majority of the long-lead-time equipment. We plan to be operational in the second quarter of 2019.”

Frankie Mathis, the chief technology officer for SME and CEO of Tactical Fabrication, says while it takes money to implement the technology, there is much more to it. “There’s a lot of meeting of the minds that had to take place, ideas exchanged, to get where we are today,” he says. “Once we figured out how to have consistent reactions with brown grease, the next thing was working with suppliers to procure good material for biodiesel production. That was a challenge. Many brown grease collectors collect more than brown grease—and by that I mean impurities.” He says only 45 percent of some loads were convertible to biodiesel. “More than half the material was not a glyceride or free fatty acid,” Mathis says, adding that he has worked with brown grease suppliers from across the Southeast to find quality product. “The only consistency is its inconsistency.”

The next challenge, Mathis says, has been scaling the advanced distillation process from pilot to production scale. Given the data that has been obtained to date, SME is confident in moving forward and commercializing the technology.

Mathis says the use of enzymes in the process is what makes it all possible. “This is big for Novozymes for us to take FOG and brown grease and covert this to on-spec biodiesel,” he says. “Typical brown grease feedstock is 600 ppm sulfur. After conversion, the biodiesel is around 300 ppm sulfur and, after distillation, it’s effectively zero. Novozymes has been very good to work with.” 

Brown says SME is working directly with municipalities, utilities and counties to implement FOG harvesting and biodiesel production. “This is really the whole business model for our company,” he says. “We’re not just a biodiesel company but a waste management company with the intention of integrating ourselves within municipalities and wastewater treatment (WWT) plants to remove FOG from their waste streams. We can do that because we have a process that can take that material, convert it to biodiesel and meet all the ASTM requirements.” Mathis says, “We have a patented piece of equipment called the FOG Harvester. With it, we can reduce disposal costs by two-thirds.” He says the waste streams from WWT plants going to landfills are basically evenly distributed as water, organic solids and oil. “We’re decreasing disposal costs for them by two-thirds,” he says. “We are able to put the water back into the WWT facility, the solids or food particles remain landfilled, which are perfect for biodigesters, and we leave with the oil.”

“To keep it simple, municipalities are throwing BTUs away,” Brown says. “We are harvesting those BTUs as part of our integrated solution for reducing the volume of disposed material. We believe this technology has applications worldwide.” Furthermore, Brown says this model of biodiesel production is profitable without government incentives such as the tax credit or even the Renewable Fuel Standard.

Author: Ron Kotrba
Editor, Biodiesel Magazine

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