Catching the Sugar Wave

Not content to let Brazil hog all the glory, three development-stage companies eye sugar-based ethanol feedstocks
By Holly Jessen | July 20, 2011

Brazil has the sugar-to-ethanol process down pat. And why not? The country’s super hot climate makes it a perfect place to grow sugarcane. The U.S., on the other hand, has spent the past several decades focused on ethanol production from corn—which grows abundantly in the Midwest. Now, with the intense focus on advanced biofuels, U.S. companies are working to catch the sugar wave.

Brazilian Money for a U.S. Project 

If successful, California Ethanol & Power LLC will be the first ethanol production company bankrolled partially by Brazilian money, but built in the U.S. The company wants to construct, own and operate a 66 MMgy advanced ethanol plant, the first of a series of plants in California’s Imperial and Palo Verde valleys, says Dave Rubenstein, chief operating officer. To finance the first plant CE&P applied for a U.S. DOE loan guarantee, but later withdrew that application due to a mutual agreement with the DOE. Now, the company is working with Uni-Systems do Brazil LTDA, a Brazilian engineering and technology company, to secure funding from the Bank of Brazil. 

CE&P has been working toward ethanol production in California for about four years, Rubenstein says. The company plans to grow about 40,000 acres of sugarcane year-round and 30,000 acres of sweet sorghum seasonally. The crops would displace forage crops, much of which are currently exported today. “We think that we can build maybe five in the southern California region,” he said. “The reason we say five is there would be enough farmland to support it, without starting to use farmland that is used to grow food.”

The sugarcane and sweet sorghum will be converted into 66 MMgy low-carbon ethanol, 50 megawatts renewable electricity and 880 million cubic feet of biomethane. The company has secured a letter of agreement with an unnamed major international energy company that will purchase all CE&P ethanol under a five-year contract at premium pricing. The same energy company will purchase all the electricity and biomethane from an on-site anaerobic digester under 20-year fixed price contracts.

To get that first $450 million plant built, the company is hoping for financial closing by the first quarter of 2012 and groundbreaking by the second or third quarter of 2012. Fagen Inc. will be the lead construction company, integrating that company’s extensive ethanol know-how with the technology and equipment from Uni-Systems, which has engineered and installed numerous sugarcane ethanol plants in Brazil.

The Imperial and Palo Verde valleys, both located in southern California, include cropland with priority rights to ample irrigation water from the Colorado River. The area is well-suited for sugarcane with lots of sunlight, no rainy season and no inclement weather. Although the first question many ask is about water, Rubenstein says sugarcane will use only slightly more water than the crops already being grown in that area.

CE&P has partnerships with a group of third-generation farmers that have been growing sugarcane in the Imperial Valley for more than seven years.The company will own the sugarcane and sweet sorghum, and plant and harvest the crops itself. The land will be leased from the farmers at market rates and the company will contract with the farmers on a cost-plus, guaranteed profit basis. That will help the company mitigate risk in varying feedstock costs and offers farmers guaranteed income. Once sugarcane is established it can be harvested or cut five times over a five-year period. The plant will switch to sweet sorghum as a feedstock in the 100-plus degree summer when the “sugarcane is growing like crazy,” he adds.

The benefits to sugarcane ethanol are many, Rubenstein tells EPM. First, it will have 85 percent lower carbon intensity than gasoline and corn ethanol and about 70 percent lower carbon intensity than imported Brazilian ethanol. The company expects it to command a premium under California’s new Low Carbon Fuel Standard. Sugarcane also produces substantially more ethanol per acre than corn. An early analysis, which looked at 60,000 acres of sugarcane, and no sweet sorghum, showed the company would produce 22.19 gallons of ethanol from every ton of sugar cane, adding up to 860 gallons of ethanol per acre of sugarcane.

There’s also the transportation factor. Midwest plants use local crops to produce a fuel that is typically transported long distances. Companies like Pacific Ethanol Inc. bring feedstocks to California from the Midwest so it can produce a fuel used close by. CE&P, on the other hand, will use locally grown crops to produce a fuel that will be sold at blending racks in the area. “It’s no rail, strictly truck,” he says, adding that all deliveries will be within three hours of the plant.

Sweet Bacteria

Development-stage Proterro Inc. is working toward a day when the company can sell ethanol producers a fermentation-ready sugar feedstock dubbed Protose. The nonagriculture-based sugar is secreted from a modified cyanobacteria. In nature, if the organism is subjected to a high salt concentration it produces an equal amount of sugar to counteract the salt and keep itself from drying up, explains Kef Kasdin, CEO. Proterro has leveraged that natural response by identifying and genetically engineering those genes so that the organism no longer needs salt stress to make sugar. “It’s a very productive little machine,” she says.  

Cyanobacteria, like algae, are photosynthetic microorganisms needing sunlight and CO2 to thrive. Unlike algae, Proterro’s genetically modified organism simply secretes sugar and does not have to be harvested or further separated. While both algae and cyanobacteria are grown in photobioreactors, the Proterro system is significantly different from the algae systems used today. “We have a different idea of how to grow these bugs,” Kasdin says.

Algae is typically grown in a liquid photobioreactor, or a submerged culture. It can be quite a challenge to get light and CO2 to the algae in what is essentially a big vat of water, she says. The algae on the surface tend to thrive, while what’s on the inside is getting starved unless it’s circulated. To get around that, Proterro took a page from nature, mimicking the structure of a leaf. Basically the company has developed a solid-phase photobioreactor with layers of fabric to grow the organism and to transport water and nutrients to the photosynthetic cells. The design puts the cells on the surface, exposed to light and CO2, and producing efficiently.

Proterro has demonstrated it can grow its organisms on a fabric surface, which the company has scaled up from a Petri dish to a square foot and then again to a square meter. Using gravity, the vertical fabric panels transport small amounts of water and nutrients to the sugar-secreting organisms. “On one path you give the bugs what they need, and sugar and the fermentation-ready solution comes out the bottom,” she says. “There’s still more work to be done to prove out this bioreactor at a real industrial scale, but we have proven the basic concept that you can grow the organisms on this substrate, very productively, and they can make sugar.”

The feedstock could be used to produce ethanol at a dedicated facility or as an add-on technology at an existing corn-ethanol plant. The patent-pending process could boost an existing ethanol plant’s capacity by 20 to 25 percent using the CO2 produced by its own fermentation process.
Founded in 2008, the company is backed by Battelle Ventures and Braemar Energy Ventures. The cyanobacteria project has its roots in Battelle Memorial Institute, which manages or co-manages six of the U.S. DOE’s national laboratories. Battelle Ventures was formed to act as an independent venture capital firm, which primarily but not exclusively, helps commercialize the scientific breakthroughs developed in the national laboratories.

Biotechnologist John Aikens was the instigator for the compelling idea that sparked Proterro. “[He told me] ‘Maybe people are going about it the wrong way,’” Kasdin recalls. “‘If we could come up with a way to make sugar directly from a process that uses sunlight, CO2 and water and take out a lot of the steps that are being used to grow up sugarcane or corn or energy crops and then break them back down again into sugar, we should be able to get to a much cheaper sugar, which can then be used for a feedstock for a number of different biofuels processes.’”

The trick will be determining what total surface area the system will be able to support and connecting all the puzzle pieces. Scale-up, on the other hand, isn’t expected to be as significant an issue because the bioreactors are modular. And, though more funding is certainly needed, Proterro’s technology isn’t expected to be as capital intensive as many other novel technologies. Because it’s produced using only water, CO2 sunlight and nutrients, the sugar feedstock is projected to cost significantly less than other feedstocks, including Brazilian sugarcane.  “Overall, we believe this could be a much more capital efficient way to get to a much lower cost sugar for ethanol production than the alternatives people have been exploring,” she said.

Detour to Sorghum 

In 2008, Great Valley Energy wrapped up the permitting process for a corn-ethanol plant in California. Then the “bottom fell out of the U.S. economy”and the original plan was scrapped, says Brian Pellens, president. In the aftermath, the group began considering all kinds of feedstocks—just not corn. “We went back to the drawing board.” Eventually, the group zeroed in on sweet sorghum as the feedstock with the most potential in California. It has some great attributes, including low water requirements. In fact, it’s commonly said that sweet sorghum requires 50 percent less water than corn, he says. In addition, since it’s not a food crop, the crop can be irrigated with water that’s not suitable for other uses. Finally, much like sugarcane, ethanol produced from sweet sorghum has a great greenhouse gas footprint.

The puzzler was that the economics aren’t much different than corn, on average. Just crushing the stalks for juice to make ethanol and burning the stalks, sometimes called the crush-and-burn model, would leave a business open to feedstock risk. On top of that, it would mean risk without the promise of economic reward. “That doesn’t make much sense,” he says.

After some head scratching, Great Valley learned of a technology to split sugarcane stalks radially, resulting in chemically and physically distinct fractions. A Canadian company, KTC Tilby Ltd., designs and manufactures the cane separation system that is used on sugarcane but also works on sweet sorghum in trial runs.

The separation system produces sweet sorghum sugar juice, which can be used to produce ethanol, and plant material that could be used as inputs for building materials, pellet fuel or even cellulosic ethanol production. Another possible product is phenolic antioxidants, or other food-grade additives, using a separate food-separation technology. “We’ve got fuels and maybe a cure for cancer, we don’t know,” he says. While crushing results in just sugar and biomass, the KTC Tilby design offers other possibilities. “Having that up-front separation process is really the key to being able to extract those bioactive compounds economically,” he says.

The company is currently working on a feasibility study to determine exactly what those products might be. As part of that, three tons of California sweet sorghum were harvested last fall, separated using the KTC equipment and sent for testing to Great Valley’s partners, Lang Technologies in Australia. Although the company has identified bioactive compounds of interest in sweet sorghum testing in the past, it’s important to test with the specific variety of sweet sorghum Great Valley plans to work with in California due to possible differences in the crop. The results of that testing were still pending in late June.

Rather than build and operate its own sweet sorghum biorefineries, as was once the plan, Great Valley is aiming to be a mid-stream company, providing sugar juice and other sweet sorghum products for ethanol production and other industries. Another possibility is working with corn-ethanol plants to provide bolt-on or modular units for added ethanol production from sweet sorghum, he says.

Great Valley’s current goal is to build a pilot plant where it hopes to process sweet sorghum at the rate of one ton per hour. Part of the funding for that is coming from a nearly $2 million grant from the California Energy Commission, the same money it is using to conduct the feasibility study, says Ed Stahl, director of business development for Great Valley, which will also leverage funds from private backers and matching contributions from various development and technology stakeholders.

The pilot plant will be located near Hanford, Calif., the site of the originally planned corn-to-ethanol plant, Pellens says. Great Valley is working to get the pilot plant up and running in time for this year’s sweet sorghum harvest, in late summer. A year later, the company should be able to wrap up most of its data collection efforts. The next step would be to build a larger plant, which could process 10 to 50 tons of sweet sorghum an hour.

Great Valley is also working to increase the storage time of sweet sorghum, which currently has a short post-harvest shelf life. In California, that would extend the processing cycle beyond the current six-month harvest season.

Author: Holly Jessen
Associate Editor, Ethanol Producer Magazine
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