RFS2 Advanced Technology—Traversing the Corn Maze

By Eric Triplett and Kenneth “Pete” Moss | March 11, 2011

The U.S. EPA continues to clarify and modify its regulations implementing the renewable fuels standards (RFS2) almost one year after first publishing its final rule. Significant questions still surround the technical and economic feasibility of the advanced technologies required to obtain renewable identification numbers (RINs) for the production of ethanol from new or expanded corn starch-based ethanol plants. 

The EPA based RFS2 RIN eligibility on the life-cycle greenhouse gas (GHG) emissions of each renewable fuel and mandated that ethanol produced from corn starch at new or expanded facilities must meet a 20 percent GHG reduction threshold by adopting specific production process requirements. For a dry mill facility, these requirements include the use of specified advanced technologies, unless it dries no more than 50 percent of the distillers grains with solubles (DGS) that it markets annually. If the facility dries between 50 to 65 percent, it must use at least one technology, and if it dries more than 65 percent, it must use two technologies. This requirement applies to all new facilities and, for existing facilities, to the ethanol volume produced beyond the grandfathered baseline volume (defined as 105 percent of the permitted volume, or if a permitted volume is unavailable, 105 percent of maximum annual volume). The advanced technologies allowed by EPA for use at new or expanded dry mill facilities are limited to the following:

•  Corn oil fractionation that is applied to at least 90 percent of the corn used to produce ethanol on a calendar year basis.
•  Corn oil extraction that is applied to the whole stillage and/or derivatives of whole stillage and results in recovery of corn oil at an annual average rate equal to or greater than 1.33 pounds oil per bushel of corn processed into ethanol.
•  Membrane separation in which at least 90 percent of ethanol dehydration is carried out using a hydrophilic membrane on a calendar year basis.
•  Raw starch hydrolysis that is used for at least 90 percent of starch hydrolysis used to produce ethanol instead of the traditional high-heat cooking process, calculated on a calendar year basis.
•  Combined heat and power (CHP) such that, on a calendar year basis, at least 90 percent of the thermal energy associated with ethanol production (including thermal energy produced at the facility and that which is derived from an off-site waste heat supplier), exclusive of any thermal energy used for the drying of DGS, is used to produce electricity prior to being used to meet the process heat requirements of the facility.

EPA made an important change to the corn oil extraction technology requirement in its December rule revisions, removing earlier language that limited extraction to thin stillage and DGS. EPA decided that “a more straightforward approach to specifying the required application of corn oil extraction in the regulations would be to identify the amount of oil that must be extracted.” This approach allows producers to apply corn oil extraction “as they see fit, providing only that the requisite quantity of oil is extracted.” Although it provides more flexibility to the producer using this technology to generate RINs, there is some question regarding its feasibility. 

Although corn oil extraction is perhaps the most attractive of the five technologies because of its relatively low cost, the 1.33 pounds-per-bushel minimum is not achievable at this time. In fact, the corn oil extraction requirement joins membrane separation and raw starch hydrolysis as technically unfeasible stand-alone options, leaving only CHP and fractionation as alternatives. Concerns exist, however, regarding the economic feasibility of CHP with one commenter informing EPA that the cost necessary to meet the CHP advanced technology standard would make it “commercially unviable.” In response, EPA noted that it did not consider cost in its considerations of applicable advanced technologies. Without considering cost or commercial availability (EPA focused on technology requirements that would be in place by 2022), dry mill facilities have few realistic compliance options. Fortunately, EPA recently confirmed that it would allow a plant to use fractionation and extraction together to meet the 1.33 pounds-per-bushel threshold to meet the advanced technology requirement. 

Dry mills should carefully review EPA’s December RFS2 revisions and evaluate how the advanced technology requirements may affect their ability to obtain RINs. Unfortunately, the rule provides little flexibility for dry mill facilities at this time given the technical and economic limitations of the advanced technologies identified by EPA.

Authors: Eric Triplett
Environmental Attorney, Faegre & Benson
etriplett@faegre.com

Kenneth “Pete” Moss
President, Frazier, Barnes & Assoc., Vice-President Cereal Process Technologies
pmoss@cerealprocess.com