(Written by By Kerri Ebert, published by Midwest Producer)
MANHATTAN, Kan. – Renewable fuel goals established by the Energy Independence and Security Act of 2007 (EISA) will not be met by corn ethanol alone. That’s why provisions in EISA contain target production amounts for cellulosic ethanol and other types of biofuels.
Kansas State University agricultural economist David Lambert has been developing economic models focusing on how development of the cellulosic ethanol industry could help meet EISA targets of 16 billion gallons of cellulosic ethanol production by 2022 and how cellulosic production might affect corn and other crop producers.
Lambert uses modeling because there currently are no cellulosic ethanol plants operating in the Midwest. His modeling indicates there may be a merit to using crop residues (i.e. straw, corn stover, and corn cobs) for energy production, but there is also a need for further research.
Raw materials for cellulosic ethanol are plentiful in the Midwestern states where supplies of herbaceous and woody feedstocks as well as supplies of corn are greatest. Lambert sees potential for the development cellulosic ethanol production throughout the Midwest – in close proximity to production acres – but cautions gathering and delivering cellulosic fuel stocks will add costs, so producers must be careful to figure their breakeven point to determine if there is profit potential in their cellulosic feedstocks.
Because of its bulk collecting, storing, and transporting cellulosic feedstock to refineries will add expense. Yield, cost of harvesting, distance to the refinery, and pay price are factors that must be considered by producers. Lambert said best estimates indicate a ton of harvested crop residue will produce approximately 60-90 gallons of ethanol. That means a 100 million gallon per year ethanol plant will require delivery of between 1.1 and 1.7 million tons of feedstock annually.
His models, based on harvest of 33 percent of available residue, indicate winter wheat could yield approximately 1.9 tons of residue per acre; sorghum, 2.1 tons per acre, and corn, 5.7 tons per acre. Using a variety of scenarios modeled by Lambert using his data and data from other researchers that look at estimated herbaceous crop residue (HCR) yields, transportation costs, and alternative uses for HCR, he sees a hypothetical breakeven price of $1.22 per gallon of ethanol to be sufficient for development of a local ethanol production facility.
Lambert points out that since there are no cellulosic ethanol production facilities online, researchers can only estimate results.
Our Take:
There are things to like and things causing concern in the Lambert analysis. The glaring concern is that there are no commercial scale cellulosic ethanol plants, and no track record of actual production. However, in the space of about 12 years, from 1995 to 2007, we went from a small handful of dry grind ethanol plants to the full fledged boom that has brought us to the current capacity around 13 billion gallons a year. Where there is a will there is a way.
Lambert seems to be considering only stand alone cellulose ethanol plants, whereas the experts we are hearing from and the first actual cellulosic production under construction now is coming out of established grain ethanol operations that are building on front-end, or parallel processing. These existing plants will be in the best position to invest in the new process and weather the volatility that is bound to come with it. We urge public officials to make sure that any support programs of cellulosic ethanol do not hinder the adoption of the technology by existing grain ethanol companies.
Finally, we still have to urge public officials, on an ongoing basis, to reevaluate the mix of grain ethanol and cellulosic ethanol called for in EISA. To meet 36 billion gallons of biofuel production in the next 12 years, perhaps EISA needs to be reset, and allow 30 billion gallons of grain ethanol. We can still have an EISA that calls for 16 billion gallons of cellulose on top of that, but perhaps we need to give them more time to reach that goal. One study has found that eventually we could have 90 billion gallons of biofuel–most of it from cellulose process, replacing more than half of our oil consumption for transportation, and this could be done without major displacement of the supply for any consumers who need grain for feed, food or manufacturing.
What we like about the Lambert analysis is that he doesn’t leave the farmer out of the equation. He figures out how much biomass farmers can produce and sketches where the break-even point is going to be, though that will vary, perhaps from farmer to farmer. We also need to see in the real world what the right amount of biomass to take off the fields will be–leaving enough organic matter to regenerate soil fertility, while also offering enough feedstock for cellulose ethanol plants.
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