Harnessing Corn Oil Power
It’s no secret that revenue from corn oil extraction has been key in keeping many ethanol plants producing in recent times of tight margins. It accounts for an increasing portion of total revenue as the majority of ethanol plants have now adopted and optimized the technology to extract the coproduct, also known as distillers corn oil. Bernie Hoffman, vice president of business development and minority owner of WB Services LLC, says that, according to those in the know, by the end of the year or early next year it’s estimated that about 80 percent of U.S. ethanol plants will be recovering corn oil. That’s a big market.
Now, WB Services is offering ethanol producers a way to turn corn oil into high-value fuels on site. The company has two separate technologies, both commercially available now, that call for co-location of either a biodiesel or renewable diesel facility with an existing ethanol plant. “We think this just adds another arrow to the quiver for an ethanol plant as far as diversifying their product mix and insulating them against tough times,” Hoffman says. Rachel Overheul, engineering manager for WB Services, agrees. “It brings a lot of potential market value to the ethanol plant, as opposed to being dependent on the corn oil market,” she adds.
The company has built and is operating a 2 MMgy biodiesel plant and is in the process of completing construction on a 3 MMgy renewable diesel facility, both in Sedgwick, Kan. Although neither facility is co-located with an ethanol plant, both serve as a showpiece for potential customers interested in co-location. “They can come and see the technology at work, feel comfortable with the way they operate,” says Ron Beemiller, company president and CEO.
WB Services has two additional reasons for building the facilities, he adds. For one, they are commercially viable, even factoring in the cost of purchasing corn oil at market value and transporting it in from elsewhere. Co-locating also has many advantages, however, including on-site production of the feedstock, lowered capital expenditure and use of existing infrastructure. Although WB Services has talked to companies interested in building the facilities as stand-alone plants, its main focus is on working within the ethanol industry. “We think that the highest value location is co-located,’” Beemiller says.
The third, and possibly most important, purpose of the biodiesel and renewable diesel plants is continued research and development. Built next door to the WB Services office, the company’s engineering staff is continuing process development and process improvement projects. “That’s kind of perpetual around here,” he says. “That never stops.”
Although both facilities are designed specifically for corn oil as the feedstock, the technology is feedstock flexible. “You can use almost any organic oil or grease,” Beemiller says. “There are a few restrictions, but not many.” And, although the facility is designed to use 100 percent of the corn oil production at the co-located ethanol plant, the technology offers the flexibility needed so the company could choose to go to other feedstocks when corn oil values go up.
From construction to commissioning, the biodiesel facility takes about six to eight months to build. The renewable diesel facility, on the other hand, goes up in about 12 to 14 months. Although the economics are very attractive for both plants, Hoffman says the biodiesel facility has a lower per-gallon construction cost than the renewable diesel facility. The return on investment or payback period will vary, of course, depending on future commodity prices. However, WB Services estimates it’s about two years or less for both the biodiesel and renewable diesel facilities. “We would hope it would be quicker but in most people’s books, a two-year payback on a capital investment is pretty good,” Hoffman says. “If you improve on that, hallelujah.”
Beemiller purchased the business that is now WB Services in late 2006, after working at ICM Inc. for more than six years. The core business offers ethanol producers and other renewable industries a variety of plant and optimization services. Beemiller and Hoffman are former co-workers who started work at ICM in the same week. The two kept in touch after leaving ICM, working on a few projects together and, as corn oil extraction grew, comparing notes on technologies for biodiesel production from corn oil, Hoffman says, adding that he came on board at WB Services later, as the company grew. “We saw corn oil as a potential coproduct stream that, in the short term, was very profitable for the plants but we thought long term there were probably higher-value products that could be created,” Beemiller says.
The search for a good corn oil-to-biodiesel technology took several years. “We kissed a lot of the proverbial frogs,” Hoffman says. It was during that search that the renewable diesel technology was discovered. Then, through an existing relationship the company had with Novozymes, they learned about a project in Denmark, for which Novozymes was developing an enzymatic process for corn oil-to-biodiesel. The company was looking for a partner to take it from the laboratory to commercial application, he says, and ended up signing a commercialization agreement.
The biodiesel technology can run either as a traditional biodiesel plant, with the acid esterification and transesterification production steps, or the enzymatic process, Beemiller says. Unlike most other biodiesel technologies, which are limited in the amount of corn oil that can be processed, this technology was specifically designed around the higher free fatty acid content of corn oil and doesn’t have those limitations. “Typically most standalone biodiesel plants can run between 10 and 20 percent corn oil and the rest has to be some other, much lower FFA feedstock to blend it down,” he says, adding that the technology utilized by WB Services does not require pretreatment.
Integrating the bolt-on biodiesel plant with an ethanol plant is quite easy, Hoffman says. The facility is tied into the ethanol plant’s distributed control system and, to cut down on the need for spare parts, uses the same brand of pumps, valves, motors and other components. “It’s a very comfortable operation,” he says. “For an ethanol plant, it looks and feels a lot like making ethanol.”
Another benefit is that very few additional staff are needed to handle the biodiesel production facility. Existing operators and maintenance staff can run it with only the addition of a brew master, who is in charge of making sure the batches are completed properly. “We’re pretty confident that you can bolt on a biodiesel plant and probably only add one or two people,” Hoffman says.
The renewable diesel facility produces a true drop-in fuel that is molecularly identical to petroleum-based diesel. It meets the standard for ASTM D975 fuel. “The only way to tell the difference is to carbon date the fuel,” Beemiller says.
In contrast to the biodiesel facility, ethanol producers won’t be as familiar with the renewable diesel plant components or production process. “[It’s] a more complicated process, but the integration is more elegant,” Hoffman says.
The process is energy long, meaning it actually produces excess energy that can be used to power the facility in addition to the coproduct naphtha and a small amount of water. The fuel gas produced, a mix of propane and butane, can be used to displace natural gas use. For a facility producing between 2 and 2.5 MMgy of renewable diesel, an excess of 5 to 6 MMBtu per hour of fuel gas could be used for power generation, Overheul says. Production of naphtha, which can be used as a denaturant for ethanol, would range between 310,000 and 370,000 gallons a year. While neither the fuel gas nor naphtha production are enough to totally displace the plant’s natural gas or denaturant needs, integrating those coproducts into the ethanol plant would certainly save the facility money.
Which production facility an ethanol producer is interested in will depend on their needs and comfort level with new technology. “Honesty I think it’s a win, win whichever technology you choose,” Overheul says. “So it’s just which technology or capital expenditure you’re more comfortable with laying out. It’s a really great opportunity to take a byproduct, the corn oil, and turn it into something with much higher value.”
There are lots of benefits for ethanol producers that add either technology, Hoffman agrees. First, the facility will have an opportunity to generate D5 advanced biofuel renewable identification numbers, or RINs. In addition, both are considered very low-carbon intensity fuels, as it relates to the Low Carbon Fuel Standard. That’s likely only going to grow in relevancy as other states besides California are considering implementing a LCFS, Hoffman says. Finally, there’s the reality that ethanol producers are facing increasing criticism right now. “One of things we like about biodiesel and renewable diesel is there doesn’t seem to be the blending pushback,” he says. “The market seems more receptive to the diesel fuels than they do ethanol.”
Author: Holly Jessen
Ethanol Producer Magazine