Traditional ethanol production technology is based on fermentation. The future of ethanol production is cutting-edge technology that will complement fermentation and expand into the cellulose arena. We must look at new technologies that represent the ultimate future of biomass-to-fuel conversion.

To date, the accepted path for cellulosic ethanol has been the enzymatic hydrolysis process. According to reports from the U.S. EPA and U.S. DOE, this technology is time consuming, labor intensive and costly to build with a high price tag and a long return on investment. Nevertheless, a number of firms are attempting to commercialize this approach. An alternative approach is the gas-to-liquids technologies that utilize patented nano-sized Molybdenum Sulfide Catalytic Reaction. Several entities, including national laboratories and major engineering firms, have evaluated this technology and found it to be viable, as well as cost effective.

The patented gas-to-liquids (alcohol) process is able to efficiently convert any biomass (e.g., grain, wheat straw, stover, wood, yard waste, manure, municipal solid waste, bagasse, etc.) into "mixed alcohol" for use in any number of markets, including transportation. The gas-to-liquid mixed alcohol product, trademarked Ecalene, is registered with the EPA for use in the transportation marketplace.

Given the high availability of cellulose feedstocks worldwide, gas-to-liquid cellulosic ethanol production offers a promising supplement to the corn-derived ethanol market. In fact, many experts believe gas-to-liquids via catalytic conversion will make the next generation of fuel for our nation and the world.

Power Energy Fuels Inc. (PEFI) of Denver, Colo. and its exclusive marketing representative to the ethanol industry, Midwest Power Energy LLC, are bringing this patented, cutting-edge technology to the market. The plants built by PEFI will be small, highly automated and modular in design. The PEFI plants are built, assembled and commissioned at the main facility in Denver prior to shipment for installation anywhere in the world. Once delivered, the plants will be reassembled, commissioned and ready for immediate operation.

Each PEFI plant can process an average of 300 dry tons of biomass per day, producing an average of 30,000 gallons of high-octane alcohol (124-plus) per day with little waste. The catalytic reaction process utilizes no natural gas and produces a significant amount of waste heat—which if located next to an existing ethanol fermentation plant—can be used to offset the fermentation plant's thermal needs. This would greatly reduce a sizeable portion of an ethanol plant's operating costs. The PEFI plants are designed to be self-supporting with an optional built-in generator using a portion of the syngas to power its operation.

Distillers Grains as Feedstock?
Midwest Power Energy is targeting the conversion of distillers grains to alcohols. Current market values of this biomass commodity show a downward trend. Additional ethanol production will continue to drive this product down in value as the laws of supply and demand take effect. Some industry analysts have anticipated that within two to three years, the market value of distillers grains may not cover handling costs.

Basic economics of distillers grains commodity prices compared with the value of ethanol shows that there could be a tremendous advantage to converting distillers grains to Ecalene. Assume a base value of $20 per ton of distillers dried grains (DDG), which is significantly lower than today's average market value. Then assume that the higher-octane Ecalene is valued at an equivalent ethanol price. For comparative purposes, assume ethanol is valued at $2.50 per gallon. The anticipated conversion ratio of 100 gallons per ton yields $250 in Ecalene sales. Hence, gas-to-liquids conversion via PEFI's patented system could potentially increase the DDG value from $20 per ton to $250 per ton. Even if distillers grains were $70 per ton, the economics of the technology are convincing.

A 45 MMgy ethanol plant will produce 125,000 tons of DDG based on a 360-day year. A conversion rate of 2.8 gallons per bushel shows a corn cost of $111,607 based on $2.50 corn, and 44,643 total bushels consumed. A PEFI system will use 300 tons of the daily DDG production, generating 30,000 gallons of Ecalene. Ecalene sales equate to $75,000 based on production volume and comparative pricing. Deducting the cost of DDG (at $20 per ton), the daily increase of sales is $69,000. Annualized, the value of Ecalene sales is roughly $25 million.

Modular System
The patented PEFI system works as a modular system attached to an ethanol production facility. DDG will be fed into a gasifier. The gasifier will produce a synthesis gas (or "syngas") having a ratio of 1:1.2, hydrogen to carbon. The syngas will then pass through the patented molybdenum sulfide catalyst, creating the mixed alcohols. The mixture of alcohols includes ethanol, methanol, propanol, butanol and pentanol. Laboratory analysis of this mixture shows an octane rating of 124-plus. These alcohols can be separated and sold into the chemicals industry, or left combined to be sold the fuels industry. The fuels industry in the United States, of course, is regulated by the EPA, and Ecalene has been registered for use by that agency.

As stated earlier, the technology uses a patented nano-sized catalyst. This is the key to highly efficient conversion. The advantage of this catalyst is that smaller-sized particles have larger surface volumes. The higher surface volumes cause a higher reaction rate. Conversion rate influences cost. The patented PEFI system has a high conversion rate and utilizes a one-pass process. Whatever gas that is not converted in the single pass will be sent to the combined-cycle electric generator system. This process allows the PEFI system to be energy self-sufficient and possibly provide a portion of a facility's power needs.

The PEFI system will also give off excess heat, which will be captured. The thermal energy will then be utilized in the ethanol production facility. This free thermal energy will be used to offset the consumption of natural gas or whatever fuel is used to satisfy the thermal load.

Novel Catalyst at Heart of System
Why is the PEFI system considered unique? The answer lies in the patented catalyst. No other company has access to this technology. Subsequently, having the catalyst with the highest conversion ratio enables PEFI to offer its customers an opportunity to be "low-cost producers." Low-cost production allows for the maximization of profits and the ability to be competitive if prices should drop and margins squeezed.

What type of feedstock is applicable for the PEFI system? The answer lies in looking at the needed syngas ratio: hydrogen to carbon, 1:1.2. There are a number of materials that can be gasified to create this syngas, including agricultural waste, energy crops and waste materials that are carbon-based. It is the waste material that needs to be seriously looked at by the fermentation ethanol industry. Waste material may be generated from such sources as waste coal (coal fines), separated municipal solid waste, industrial waste and items like wastewater treatment sludge.

Many of these waste products can be obtained at a negative cost. That negative cost creates an economic disadvantage to the distillation industry, which must pay for its grain source. The opportunity to turn a devaluing DDG product into a feedstock for gasification gives the producer of the fermentation coproduct an opportunity to reduce costs and create a competitively priced product.

If the United States is serious about energy independence, then the negative cost waste streams will be considered for future transportation fuels sources. Waste streams are plentiful and currently considered an environmental problem and a societal cost. Gas-to-liquids technology will change that landscape. As that concept takes hold, grain ethanol production plants will need to decrease costs and expenses, to determine where opportunity lies. Cost-competitive products and margin retention are key to the distillation ethanol producer's economic survival.

Our nation must reduce its reliance on imported oil to power our economy. Producing energy from wind and solar energy are steps in the right direction. Making better use of our natural resources is an additional step to take. Converting abundant biomass into fuel will take the United States further along the path to energy self-sufficiency.

Bob Fry is president of Mediapolis, Iowa-based Midwest Power Energy LLC. Reach him at midpowerenergy@yahoo.com or (319) 394-3180.