Pellet Technology targets cellulosic ethanol producers

Nebraska-based Pellet Technology LLC is teaming up with CPM to offer second-generation biofuels producers a solution to the logistical issues surrounding the use of bulky biomass as feedstocks. Pellet Technology, which became commercially active just a few months ago, has developed a patented technology to produce pellets from corn stover and other energy crops. The pellets can be used to co-fire industrial boilers, but they can also be used as a feedstock for cellulosic ethanol production, according to Russ Zeeck, chief operating officer of Pellet Technology. This application has been tested commercially and will be used in several U.S. DOE-funded projects, including the EdeniQ Inc. pilot plant in California, he said. It’s also ready for use at commercial pellet mills, and the company is in talks with several liquid biofuels groups to construct mills in rural locations to service biofuels facilities, he said.

CPM, which is a major process equipment supplier to the biofuels industry already, has signed on to be the exclusive provider of equipment for the technology process. Jim Hughes, CPM general manager, said Pellet Technology is on the “cutting edge” of process development for renewable energy. Zeeck said CPM’s hammermills and pellet mills are the only pieces of equipment that have met his company’s quality standards, which is why it has the exclusive equipment rights. “No other pellet mills and no other grinders have been able to meet our quality parameters necessary for biomass customers,” he said.

About $12.5 million should cover the construction costs to build a pellet mill capable of processing 175,000 tons of corn stover annually, according to Zeeck. Pellet Technology’s business model includes licensing its technology to companies and cooperatives that will construct the mills in rural areas, similar to the model used currently for grain elevators. Each centrally-located pellet mill could then service multiple biofuel production facilities, Zeeck said. Approximately 75 gallons of ethanol can be produced from each ton of Pellet Technology’s pellets, which means a 20 MMgy ethanol plant would need access to about 265,000 tons of pellets.

Sustainability is a primary focus for Pellet Technology and Zeeck said they are willing to turn down farmers who offer to provide corn stover but may not be able to do so in the most sustainable fashion. Iowa would seem an obvious choice for any corn stover-related business, but Zeeck said that is not necessarily the case when sustainability is the first objective. “While Iowa is the largest corn-growing state, it’s not necessarily the largest sustainable harvester of biomass,” he said, adding that the pitch of fields contributes substantially to the amount of biomass that can be sustainably harvested. Pellet Technology is working on projects in Iowa, but it also working with groups in Nebraska, Indiana, Illinois, Michigan and Ohio.

Confidentiality agreements prevented Zeeck from sharing details regarding its pending commercial projects, but he said the first commercial mill should become operational next August. Pellet Technology is also constructing a research and development facility in Omaha, Neb., that will come online in December. There, the company will run trials to examine the use of corn stover pellets as a supplemental animal feed and will continue to tweak its design basis for liquid fuels and utility combustion groups use. Zeeck said the company will also experiment with enzyme additions to the biomass.

Many of the logistical issues related to the use of agricultural residues are related to the transport, storage and pre-processing of the biomass. Zeeck said those issues become non-issues when pelletized biomass is used. “The primary issue we’re dealing with is a lot of the groups we’re working with currently who are building numerous pilot plants have run into permitting issues and long-term storage of bales, bale handling and management,” he said. “Essentially it means you have to run a bale a minute for a lot of these facilities to run seven days a week, 365 days a year. With our pellets, that eliminates that problem.” Financial concerns from investors and banking institutions can also be alleviated through the use of the pellet technology, he said, adding that the biofuels groups working with Pellet Technology now were attracted to the projects in part because they are able to lock in a seven-year feedstock contract.