Shining Light on Energy Efficiency
Ethanol plants run on loads of energy—both the power used in the process itself and in the time and effort expended by managers.Being energy efficient makes good sense both from an environmental standpoint, through reduction of plant emissions, and from an economic standpoint because it saves plants money.
“Energy comes in at our second largest cost,” says Darrell Birck, Flint Hills Resources vice president of operations. “It makes up approximately 10 percent of our entire cost structure.” About 80 percent of that 10 percent is the cost of natural gas used to run plant dryers and thermal oxidizers at its seven plants, Birck says. The remaining 20 percent of the total energy cost is electrical use.
Energy also is No. 2—after corn—on the list of expenses at Big River Resources and accounts for about 9 percent of the company’s operating costs at its four plants, says Ralph Peel, Big River Resources Galva plant manager.
At Green Plains, energy is a “significant expense” in terms of the profitability equation, says Jeff Briggs, chief operating officer. Company officials in Omaha, Nebraska, monitor the price of energy sources at its 17 plants and lock in prices similar to the way it locks in the price of corn, Briggs says. “We think of natural gas in terms of overall commodity exposure and do what we can to decrease costs on the operating side.”
At Pacific Ethanol, energy costs are “always there” when the company considers capitalizing projects, says Patrick McKenzie, director of engineering. “If it’s not No. 1, it’s in the top three.” Whenever Pacific Ethanol is considering a new project at one of its eight operating plants, company officials consider how much energy will be consumed per gallon of ethanol produced, McKenzie says. “So it’s always part of the equation.” The primary project goal may be yield improvement, he says, “but then No. 2 would be ‘What does it do to our energy platform?’ And it can kill a project—there’s no point in seeing a 1 or 2 percent improvement in yield, if you just took a 5 percent hit in energy. Your operating costs just squashed the project,” McKenzie says.
Saving energy can be considered the low-hanging fruit of cost reduction. “Energy is the biggest lever in our plants that we can actually pull,” Birck says. One way that Flint Hills reduces energy costs is to conduct periodic energy audits. “We’re tuning our boilers and dryers. We have people who are constantly taking a look to make sure we’re optimal as we can be.
Flint Hills is fortunate that its plants were designed to be energy efficient from the get-go, Birck says. “We’re in a good position because the plants we run are ICM-designed and they were designed to be very energy efficient. The energy that we use to dry the DDGS on the back end is the same energy we turn around to operate steam with, so we’re actually recovering heat, regenerating steam. We use the steam in other parts of our process, in our distillation and all.”
Meanwhile, Flint Hills managers continually screen new energy concepts to see if they can improve plant energy efficiency even more. “We screen products on a monthly basis,” Birck says. “We’re always looking at another energy opportunity, to find some way to reduce our costs.” Yeast and enzyme optimization is part of the equation as well. “We want to have the highest drop of ethanol we can, so that when we process it through, it’s not burning energy to drop water off because it didn’t get a good ethanol yield.”
Green Plains also is continually seeking ways to improve energy efficiency, Briggs says. “That can be done in a variety of ways. It can be done through better heat recovery processes in the plant so you have more efficient use of natural gas, or being more efficient at the process or dryer operations, or with variable speed pumps—anything we can do to use electricity more efficiently.
“The industry has really improved pretty significantly from a Btu-per-gallon standpoint. We’ve seen continuing improvements with different technologies, and even within the existing technologies, through upgrade projects we have done. We continue to focus on improving our efficiencies for natural gas and electricity. If we can produce more gallons, typically we see those efficiencies improve, as well, and that helps overall cost structure.”
Green Plains ethanol managers also monitor their plants’ boilers to make sure they are running efficiently. “We repair them and keep them up to speed,” Briggs says. “All of our plants have people who can work on the boilers and repair boilers, but we also use outside venders and experts. We’re not afraid to go out and find experts who have the knowledge and understanding to make sure the boilers are operating properly.”
At Pacific Ethanol, opportunities to improve energy efficiency have come with better design engineering, steam and electricity efficiency gains and as new technologies are integrated, McKenzie says. “You look for your best opportunity—what’s going to give us our largest return on investment? Some of them are very apparent. There are substantial projects with very fast pay-backs, sometimes less than a year.” Another key point is the ability to measure the gain, he says. “What do we look for? It has to be measurable so we can define it ahead of the project.” Once the capital improvements are installed, it’s important to measure the results and determine whether the plant received the intended benefit, Mc-Kenzie says.
Reading is a good way to find energy efficiency improvements, he says. “There are a lot of good articles in trade journals on energy.” Pumps and any piece of equipment that rotates are candidates for improved efficiency, McKenzie says. He suggests reading articles, for example, about variable frequency drives, and their application. “It’s a little more money and it takes more effort, so it didn’t lend itself well to initial construction, but it’s a perfect example of a retrofit you can do. A plant can see significant reduction in electricity demand.”
Pacific Ethanol also monitors key metrics on its energy consumption per gallon of ethanol produced, plant by plant, on a monthly basis. “That forces you to look at why one is better than another, and if you have poor performance, you figure out how to move that plant to be in line with the others. It’s like a competition.
“We have completed other audits in the ethanol process. Things like monitoring motor loads, thermal cycles, and thermal loading,” McKenzie says. “This is granular work where we get into the plant and gain understanding where most of our energy is consumed through the distillation and dehydration systems and are there means for us to use waste heat? That’s the progression, understanding it first so perhaps you can improve it. You can’t improve it until you understand it.”
Pacific Ethanol also screens products. “We call that the ‘shiny object’ program,” McKenzie says. It is important that plant managers listen to salespeople promoting their products. “The minute you hang up and not listen is the minute you may have walked away from an opportunity.”
Taking advantage of energy incentive programs, where available, can save plants money as well, notes Peel.
“There are a lot of incentive programs from utility companies to help you offset costs. Illinois has a natural gas energy efficiency self-direct program,” Peel says. “There is a requirement that you keep $400,000 on your books for gas efficiency reductions to reduce your natural gas usage, and you cannot spend that money on other projects. So you do a natural gas reducing project and then you submit your documentation to the state and they say ‘Yes, you can utilize funds for those.’” Available energy efficiency upgrades for ethanol plants include installing energy efficient boiler controls, boiler tune-ups, installation of high-energy burners on furnaces and insulating steam pipes, Peel says. “Anything that is going to help you reduce energy. There is a large list of things.”
Poet is expanding its use of combined heat and power (CHP), which vastly improves efficiency and reduces greenhouse gas emissions by using high-pressure steam to generate electricity to run the plant and recovering waste energy to meet additional energy demands in the ethanol process. Poet announced in October that six of its ethanol plants in Ohio and Indiana would be installing a new-generation CHP.
“This is very exciting for Poet and renewable fuels. We are already much better than gasoline in overall emissions. Finding ways to make additional uses of steam is a great opportunity to improve our environmental footprint even more,” Jeff Broin, Poet CEO, said in a prepared statement when the company announced the CHP initiative. Besides installing the CHP systems, Poet also reduces energy use in its plants through its patented BPX process, which uses enzymes instead of heat in the fermentation process, along with sharing heat between processes such as distillation and evaporation to get maximum production with minimum energy use.
Author: Ann Bailey
Associate Editor, Ethanol Producer Magazine
Sun Power for Ethanol
Low carbon intensity scores rule the market in California, providing an incentive for Pacific Ethanol to be the first U.S ethanol plant to get part of its power directly from the sun through a 5 MW solar photovoltaic (PV) system to be installed at its Madera, California, ethanol plant.
The solar PV system, designed and built by Borrego Solar Systems Inc., is expected to reduce Pacific Ethanol’s operating costs and improve its carbon score. Through the displacement of more than 30 percent of the grid electricity Pacific Ethanol uses, the company expects to reduce the annual utility costs at its Madera plant by more than $1 million and drive premium pricing on the ethanol produced due to improvements in its carbon intensity score. Meanwhile, the power system qualifies for the Energy Tax Investment Credit, further improving its investment profile.
The integration of solar power at Pacific Ethanol’s Madera plant highlights the company’s commitment to optimize its plant assets, reduce the carbon intensity of its ethanol and decrease operating costs, says Neil Koehler, Pacific Ethanol president and CEO. “We are proud to build the first-ever solar electricity system at a U.S. ethanol plant,” Koehler said in a news release announcing the project. “Pending the completion of interconnection agreements with our local utility, Pacific Gas & Electricity, we expect to being operating the PV system at full capacity in early 2018.”
Pacific Ethanol represents the new generation of fuel companies—low-carbon fuel production powered by zero carbon energy, says Chris Otness, Borrego Solar project developer. “This will be one of the largest single-site, net metered projects in PG&E territory. Historically, these types of projects were limited to a single megawatt, but given the recent CPUC NEM 2.0 ruling, large energy users now are able to go above that threshold and offset a significantly larger portion of their overall usage.” Meanwhile, Pacific Ethanol will retain ownership of the system from day one and capture the tax incentives afforded to solar system owners.
Pacific Ethanol financed $10 million of the expected $11 million cost of the solar PV power system through the CleanFund Solar PACE program for a 20-year term, enabling immediate net cost savings and positive cash flow from the project. CleanFund, based in Sausalito, California, provides long-term financing for energy efficiency, renewable energy, water conservation and seismic improvements to commercial, multifamily and other nonresidential purposes in the United States.
CleanFund CEO Greg Saunders said in the news release that his organization is honored that Pacific Ethanol selected his company as its capital partner program to provide long-term financing for a state-of-the-art solar system. “The demand for commercial PACE financing continues to grow rapidly because it represents a large-scale opportunity to provide cost-effective, long-term financing for renewable energy, energy efficiency and water conservation measures for most nonresidential properties.
“We are excited to partner with Pacific Ethanol as it leads the way in the deployment of renewable energy at its industrial facilities,” Saunders says.