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July 3, 2023
By Cassidy
Walter
Expanding ethanol's legacy into new markets
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For decades the American ethanol industry has
supported farmers, created jobs in rural communities, and displaced
toxic chemicals in light-duty fuel tanks across the country. Today,
the changing landscape of transportation has the industry looking for
new opportunities in addition to the light-duty market to expand that
legacy.
“If we’re going to grow markets and grow demand for our products and
agriculture in general, we’re going to need to develop new markets
beyond the light-duty transportation sector,” says Monte Shaw,
executive director of the Iowa Renewable Fuels Association (IRFA).
Shaw says the ever-increasing efficiency of vehicles, the growing
demand for electric vehicles, and a cultural trend away from driving
in general, is leading to a long-term decline in fuel consumption. To
highlight new opportunities for ethanol, IRFA featured three emerging
markets earlier this year at the annual Iowa Renewable Fuels Summit in
Des Moines, Iowa.
“If we do this right, this is going to be a tremendous opportunity for
farmers, and we’re going to see increased demand for their products,”
he says.
Sustainable Aviation Fuel
Air travel is widely considered part of the “hard-to-electrify space”
where biofuels are critical to lowering the carbon footprint of the
industry.
Ethanol is one of several renewable products vying for market share in
the sustainable aviation fuel (SAF) market. SAF producer Gevo says
ethanol has the advantage of being the lowest-cost feedstock to
produce SAF.
“However, ethanol itself from a typical ethanol plant can’t get a low
enough carbon intensity reduction,” says Patrick Gruber, CEO of Gevo.
“The vast majority of the carbon footprint of ethanol is due to the
energy of production. So this is very much about infrastructure as
well. That’s what makes this difficult.”
Gruber says before ethanol can be used as a feedstock, several pieces
need to fall into place. First, the supplying plant must be capturing
and sequestering carbon, and powering the plant with renewable energy
sources. That will lower the carbon intensity (CI) score of the
ethanol enough that it can be used to produce SAF that meets the
specifications for the tax credit in the Inflation Reduction Act.
Second, he says it is important farmers get credit for their soil
health practices. Lastly, Argonne National Laboratory’s GREET model
must be used to calculate the CI scores.
The U.S. Department of Treasury is currently writ-ing regulations
around the SAF tax credit, including what model may be used. Emily
Skor, CEO of Growth Energy, a national ethanol trade association, says
the industry is working with the department to ensure ethanol is not
excluded as a feedstock.
“We want to be able to contribute in the hard-to-electrify spaces as
well as for light-duty vehicles, and these are fantastic
opportunities,” says Skor.
Despite current barriers to entry, Gruber says he is optimistic
ethanol will be used to create SAF, and it will be a significant
market for the ethanol industry. He says if the entire U.S. ethanol
production capacity of roughly 17 billion gallons was suddenly
diverted just to SAF production, it could fill the entire 10
billion-gallon SAF market.
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ClearFlame and Heavy-Duty Vehicles
While ethanol is traditionally used in gasoline engines, new
technology has made it possible for ethanol to run in diesel engines.
“When you integrate our technology, you enable the diesel engine to
become fuel agnostic,” says BJ Johnson, CEO and cofound-er of
ClearFlame Engine Technologies.
Johnson says ClearFlame gives diesel fleets the advantage of
maintaining the performance of diesel engines while saving money with
ethanol.
“That’s a huge market opportunity for ethanol. It’s also a longer-term
market opportunity for ethanol because the need for liquid fuels in
those hard-to-electrify sectors is not going anywhere anytime soon,”
he says.
Heavy-duty vehicles are considered hard to electrify, and other fuel
options such
as biodiesel and renewable diesel are also directed at reducing their
carbon footprint. Johnson says with the U.S. diesel market being
roughly 60 billion gallons, all solutions are needed.
“The value of these bio-based fuels is only going up and up and up,”
he says.
Still a relatively young company, ClearFlame is fulfilling its first
sales this year, working with fleets to retrofit engines. Down the
road, it hopes to collaborate with engine manufacturers to integrate
the technology.
Proteum Energy
The newest market opportunity the ethanol industry has its eye on is
Proteum Energy. Proteum aims to use ethanol to produce “clean
hydrogen,” which is hydrogen produced with a low carbon intensity.
Through its steam non-methane reforming process, Proteum plans to
crack low-carbon ethanol to produce hydrogen that has a negative
carbon intensity, initially for hydrogen fuel cells for heavy-duty
vehicles.
John Rosenfeld, Proteum vice president commercial/strategic, says
producing clean hydrogen from ethanol has several advantages over
other processes, including being less expensive and requiring less
water.
Furthermore, he says ethanol won’t have to compete for market share
like it has in the light-duty market against oil companies.
“This is an opportunity to come into the market very early and carve
out a much larger piece of that market based on ethanol’s advantages,”
Rosenfeld says.
However, carbon capture and sequestration (CCS) is key again. CCS is
estimated to reduce the carbon intensity of an ethanol plant by
roughly 30 points. Rosenfeld says this is why the CCS pipelines
proposed to crisscross the Midwest capturing carbon from ethanol
plants and sequestering it underground are vital for the future of
this market opportunity.
Proteum is building its first plant near an existing ethanol plant in
central California. It estimates it will be running using ethanol from
its neighbor by 2025.
“Hydrogen need not be in competition with ethanol,” says Rosenfeld.
“We’re actually right on the same page.”
Green Play Ammonia™, Yielder® NFuel Energy.
Spokane, Washington. 99212
www.exactrix.com
509 995 1879 cell, Pacific.
Nathan1@greenplayammonia.com
exactrix@exactrix.com
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