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MN2020 - Tuesday Talk Q&A: Beyond Fuel Ethanol
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Tuesday Talk Q&A: Beyond Fuel Ethanol

October 22, 2013 By Joe Sheeran, Communications Director

Minnesotans have strong feelings about ethanol, with some calling it a homegrown fossil fuel alternative that produced an economic boom for rural economies and others labeling bio-fuels as an inefficient use of farm land that artificially drives up food prices?

Regardless of your take on ethanol, industry experts say that new technology can be deployed to produce a variety of biobased chemicals and second generation biofuels. The future of the industry should involve diversifying to produce both biofuels from non-food materials, and higher value biobased chemicals that can replace petroleum-based plastics, lubricants, solvents, and other materials.

This morning between 8-9:30, Brendan Jordan, Program Director for Bioenergy and Transportation Programs at the Great Plains Institute, joins us to discuss moving beyond fuel ethanol.

What’s your take on expanding this industry? Will it help preserve farm land for growing food? 

 

Post your comments or questions in the box below, scroll down to see the ongoing conversation, and use "refresh" to see new comments. 

Thanks for participating! Commenting on this conversation is now closed.

36 Comments:

  • Rachel says:

    October 22, 2013 at 7:16 am

    Good morning! Brendan will join us at 8. In the meantime, share some of your initial thoughts on biofuels in Minnesota. If you can’t join us from 8-9:30, leave any questions here and Brenden will answer them when we get going at 8.

  • Jane says:

    October 22, 2013 at 8:05 am

    I love the idea of the new generation of biofuels use non-food materials.  I think that the use of non-food materials will help preserve farm land for growing food.

    • Brendan Jordan says:

      October 22, 2013 at 8:11 am

      Great point Jane. That’s what we generally refer to as “cellulosic” biofuels - or biofuels made from cellulosic materials. Another way to say that is biomass. It includes corn stalks, switchgrass, wood, and other non-food materials. This is a huge opportunity. And we’re much closer to having that technology up-and-running than many people think. Among biofuel circles, there has long been a saying that cellulosic biofuels will always be five years away (ha ha).

      But you can no longer say that. A 20 million gallon per year cellulosic ethanol plant just opened in Italy last week. In Florida, a plant using biomass in garbage opened this summer. In Mississippi a wood-based biofuel plant is operating. And in Iowa, a plant using corn stalks to make ethanol will open in Spring of 2014.

      The real question - how can we bring projects like this to Minnesota?

      • Lee Egerstrom says:

        October 22, 2013 at 8:25 am

        It appears to me that we are slowly moving in the cellulosic direction, and some of our Minnesota ethanol plants are taking lead positions. Chippewa Valley Ethanol at Benson, for instance, is into biomass generation to reduce it natural gas usage. While this doesn’t replace corn as a feedstock for ethanol, it is greatly reducing the plant’s “carbon footprint” in making the fuel.

        • Brendan Jordan says:

          October 22, 2013 at 8:45 am

          Completely agree with you Lee. Chippewa Valley was an early leader. I am a big proponent of moving towards cellulosic production, but I think its important to emphasize that huge efficiency and greenhouse gas improvements are possible (and happening) in corn ethanol plants. Corn ethanol from an “average” plant might have emissions 20% better than gasoline. The most efficient plant might be 50% or greater.

          I think Poet-DSM’s Project Liberty in Emmettsburg, IA is a very interesting model. It is a corn ethanol plant with a “bolt-on” cellulosic biofuel plant. Essentially they are adding the ability to take in corn stalks and process them into sugars, but they will still be producing corn ethanol. Co-location will result in many efficiencies. And the overall carbon footprint of all the ethanol will be much lower. It is cheaper to bolt a cellulosic plant onto an existing ethanol plant, than to simply build a stand-alone plent.

          My view is that it is important to think of the move towards cellulosic biofuels as a continuum where we continue investing in existing facilities, rather than a wholesale re-start.

  • Lee Egerstrom says:

    October 22, 2013 at 8:06 am

    This is a question for Brendan: Has research into new biofuels produced anything that might be a viable alternative to ethanol within the foreseeable future?

    • Brendan Jordan says:

      October 22, 2013 at 8:20 am

      See my response to Jane.

      I will answer that in two parts. What biofuel are you producing? And what are you making it out of?

      For starters, I don’t think we necessarily need an alternative to ethanol. Nearly every gallon of gasoline currently sold in the US is around 10% ethanol. There are designed to accomodate it. In fact, gasoline blenders depend on ethanol’s higher octane, and are able to produce lower octane gasoline “blendstock” to blend with it. Automakers have indicated they would actually like higher octane gasoline to be available to allow them to design smaller turbo-charged engines to help meet federal efficiency standards. That’s a few years off. The point is, you could easily design cars that handle much higher levels of ethanol without losing fuel efficiency. Currently so-called “flex fuel” vehicles that can use up to 85% ethanol blends do suffer from lower fuel efficiency when they use those blends - but that is simply because their engines are not optimized for the higher octane.

      There are other pathways to getting biofuel into the fuel system. One of them is butanol - a slightly longer-chain alcohol. We actually have three ethanol plants in MN that have converted (Gevo) or are considering converting (Butamax, Green Biologics) to produce butanol. Right now its still made from the same thing - corn grain - but it can be blended at a higher level with gasoline in a regular gasoline engine (no optimization needed).

      We should also diversify what we make biofuels out of - see my response to jane above.

  • Brendan Jordan says:

    October 22, 2013 at 8:06 am

    Good morning. This is Brendan Jordan. I am lead staff for the Bioeconomy Coalition of Minnesota - an industry-led partnership working to build the next generation of renewable chemical and advanced biofuel projects in Minnesota. There has been a lot of agonizing about biofuels in our political discourse. But the real question is: where do we go from here? Minnesota has been a national leader in using state policy to build an ethanol industry. Can we repeat that success to build an advanced biofuel industry (using non-food-grain feedstocks), and higher value renewable chemicals industry?

    Minnesota has all the pieces in place to do just that. But it will take policy leadership to get there.

    • Joe says:

      October 22, 2013 at 8:10 am

      Thanks for joining us Brendan. Are there any Minnesota examples where bio-based materials are being used for a higher value product than fuel? And if so, how much higher of a value?

      • Brendan Jordan says:

        October 22, 2013 at 8:33 am

        Higher value products create an opportunity for increased diversification. That means new products and higher revenue for Minnesota’s ethanol industry and forest products industries.

        In an oil refinery, only 3-5% of the output, by volume, is non-fuel products like plastics, chemicals, solvents, etc. But those products represent around 40% of the revenue! Why should biorefiners miss out on such a huge revenue opportunity.

        Minnesota is in the fortunate position of having a world-class innovation cluster of established and start-up high tech biobased chemical companies. The ultimate vision is to be able to produce anything that we now make from oil out of renewable feedstocks, and do make those things perform better. Companies in Minnesota include Natureworks, Segetis, BioAmber, Reluceo, XLTerra. They have different technologies and products, but they are all working towards the same goals.

        They challenge for our state is how to encourage production of those materials in Minnesota. We are competing with other jurisdictions around the world that are aggressively competing to attract production facilities - places like Brazil, Thailand, China, Canada, and Europe. Minnesota is doing a decent job of attract research and headquarter facilities. How can we make sure these companies continue to grow in Minnesota, and expand the economic impact to rural parts of the state?

        • Joe says:

          October 22, 2013 at 8:37 am

          What are some tangible steps (minus huge tax giveaways) Minnesota policymakers can take to grow this industry? It is a matter of taking advantage of our current resources and growing our own businesses or attracting outside companies to expand here? How do we do that?

          • Lee Egerstrom says:

            October 22, 2013 at 8:46 am

            As a follow to Joe’s question: How much of the research for higher-value product development is private, applied research by firms Brendan cited above? And are we doing enough public research through U of Mn and AURI, for example, to make Minnesota a leader in these fields?

            • Brendan Jordan says:

              October 22, 2013 at 9:09 am

              UM and AURI are doing great work in this area. There is also significant venture capital funding coming into MN to support early stage technology companies. The DOE and USDA have supported R&D in cellulosic biofuels, but offered more limited support for renewable chemicals. That could change if we pass a new farm bill - biobased chemicals may end up being added to some of the Farm Bill Energy Title research and development programs.

              Bottom line - yes, Minnesota could be doing more in research and development. But I think the priority now should be to support bringing technology to commercial scale. We have a number of technologies that are right on the cusp, and if we don’t act quickly as a state, we will lose our innovation cluster. This industry has the potential to be bigger than medical devices if we act.

          • Brendan Jordan says:

            October 22, 2013 at 8:52 am

            It will take investment by the state of Minnesota. It won’t happen otherwise. Minnesota is competing with other states and jurisdictions that are investing in making these projects happen.

            We support re-imagining the ethanol producer payment, and using a similar program to build a renewable chemicals and advanced biofuels industry. There are many advantages to this approach. With a production incentive, the state doesn’t pick projects, technologies, or companies - the simply reward success. There are no boondoggle projects - no money goes out the door until production occurs. But if we created this program, we would be the best place in the world to cite these projects.

            Minnesota should also consider other mechanisms, like loan guarantees, to support financing of capital intensive production facilities.

            Finally, Minnesota should redirect a small percentage of the $65 billion managed by the state Investment Board to make investments in Minnesota-based clean technology companies. They should pair up with other investors so the risk (and due diligence responsibility) is shared, and they should make multiple technology bets to manage risk. But there is no reason we can’t use some of our state government’s accumulated wealth to help grow innovative companies in the state.

            • Lee Egerstrom says:

              October 22, 2013 at 9:10 am

              You offer a good road map for action. I suspect the general public can see a need for change, and for future development, but it is less easy to see how we might get there.

              • Brendan Jordan says:

                October 22, 2013 at 9:25 am

                We’re out there making our case. I think we will have good legislative support for taking some action this session.

            • Jack Ray says:

              October 22, 2013 at 9:52 am

              Brendan, the devil is in the details as you know. I think we can get this done if we invite a broad coalition to the table from the beginning. To actually fare well in the global competition to be a successful center of innovation at a significant scale will take bold and decisive action uncharacteristic of Minnesota of late. If we can re-imagine the ethanol producer payment in a manner that supports a truely green, sustainable path forward, I think we could move it forward. It would need to be “deep green” and tied in with business development, employment and education disparities, and trade policy. I can imagine an expansive approach that gets at these together, but it will take some doing!

  • KJC says:

    October 22, 2013 at 8:41 am

    Originally I came from a farm background… many of my cousins still farm.  So I am not unsympathetic to rural concerns.  That being said, for society as a whole, it was never a good idea to put our energy needs into more competition with our food chain.  This is just the same-old story of lobbyists and tax breaks… and ethanol has gotten huge tax breaks, and high import tariffs to keep cheaper ethanol out.  Big Ag made out Big Time.
    There is possible progress in shifting the whole process off food crops like corn, and onto things like switchgrass, etc.  Perhaps technology can eventually take this situation out of the current one being: “probably a small net loss for all of society…but hugely lucrative for a few” category. 
    The latest ethanol industry push is to make gasoline fuel be 15% ethanol.  Unless you have a “flex fuel” car, that’s not a good idea.  The car makers are screaming because they know their will be problems… cars were not built for that fuel, and we will find-out all sorts of things like gaskets, etc are going to fail.  The ethanol lobbyists want to ensure a bigger market…. and they are NOT setting up a fund to pay for all the fuel system damage they are going to cause car-owners, that will be: On You.   
    I wish I had better news, and with lots of development funding, I think there’s the real possibility this could be a good thing.  The corporate lobbyists, feigning to be “for the farmers,” are clearly more interested in legislating to ensure immediate profits… and seem not at all interested in paying taxes (or putting in their own serious funding) for the basic research and development necessary to make this into: a long-term Common Good.

    • Brendan Jordan says:

      October 22, 2013 at 9:41 am

      -Ethanol no longer receives tax credits, although it did at one time. Actually the oil industry recieved the “blenders credit” to motivate them to buy ethanol. Again, this tax credit went away a couple years ago.
      -In general, new technology does not come into existence without government support. That is true with everything from aviation to the internet, from coal-fired power plants to wind power. The private sector just doesn’t have to ability to invest massive amounts of money in basic research. If you want to complain about biofuels, you should be complaining about your cell phone too.
      -Cars newer than 2001 are approved by the EPA to use E15. It is true that automakers are unhappy about the way E15 is being rolled out. It is also true that many automakers want to see an even HIGHER blend of ethanol introduced in the future - with higher octane, to help them design engines that achieve CAFE standards.

      I don’t know if you were pointing fingers are me - but I’m not a corporate lobbyist, and I don’t have a profit motivation behind my policy prescriptions. I say what I think, based on many years of studying these issues.

      • KJC says:

        October 22, 2013 at 11:38 am

        I’m pointing the finger at industry.  There are 10’s of millions of previous-to-2001 cars on the road, for example… what do you do when E15 causes fuel system problems for those?  (P.S. The big effort on the car front seems, near term, to be on natural gas, which “fracking” has made currently cheap…not on E85.)  Our problems are less about what-might-be-possible in this very important area, and more about not having the agenda captured by special interests, which remains an ongoing issue.  I find it more than slightly ironic that the effective answer for cellulosic appears to be a huge research and development effort, likely paid for by the government (taxpayers) and many energy industry people are the very same ones with the “smaller government” mantra constantly on their lips.  (They always mean for “somebody else.”)
        Energy cost gets into everything, and there is the whole climate change issue, too.  The public “conversation” is being driven by slick industry ads (by entities like the API, American Petroleum Institute) positing things like the Keystone XL pipeline as “good for our energy security.”  Except?  A genuine analysis suggests a resulting rise in gasoline cost here in the Midwest… of between 10-25 cents a gallon… as the pipeline now goes to an Ocean Port (instead of ending in Oklahoma, as it did previously) making the petroleum more exportable (to China, who spent $16 Billion getting control of the Tar Sands.)  I doubt most Americans would support the pipeline knowing that price increase was their “benefit,” to go with the inevitable spills.  But?  As long as the public is lead to think that “they” will be getting the oil, etc…. well, they won’t find out until it’s too late?  All progress starts with being honest about how things really are, now… and my posts are merely to point-out that a lot of what’s occurred in the ethanol/energy sector (and is occurring) doesn’t resemble rational choice for the long-term Common Good, it’s been driven by special interests.  It’s a highly complex issue, with so many possibilities and changing constraints…we will need vigilance and determination to go with our optimism.

        • Robert Moffitt says:

          October 22, 2013 at 4:28 pm

          Here in Minnesota, most of the natural gas vehicles are replacing older diesel vehicles. With more than 300,000 flex fuel vehicles registered in Minnesota, and more E85 stations than any other state, the ethanol-based fuel still has a role to play.

          • KJC says:

            October 22, 2013 at 4:42 pm

            My information suggests otherwise.  Companies as diverse as Audi and Chevrolet have recently announced cars, not trucks, that will be natural gas… some bi-fuel, to deal with “range anxiety.”  E85 is here, but I don’t hear anything new, no push for expansion.  This whole scene is moving so fast, it’s hard to keep up!

            • Robert Moffitt says:

              October 23, 2013 at 9:26 am

              Yes, I’ve heard about the plans to introduce the bi-fuel sedans in the U.S., and I think that’s a great idea.  Minnesotans bought something like 2 million gallons of E85 each month this summer. It may not make headlines, but it’s still a big deal.

  • Elaine Mayer says:

    October 22, 2013 at 8:51 am

    My concerns about ethanol are the use of potable water, and corn which is an annual (plant) that requires more ground and care than a perrenial. Water seems to be renewable, but we are using it much faster than the water cycle can restore it. We are creative people, so I look forward to better options for replacing non-renewables.

    • Brendan Jordan says:

      October 22, 2013 at 9:05 am

      These are valid concerns. We should strive for continuous improvement in water use. There are a number of areas where our water resources are being depleted in an unsustainable fashion.

      According to Poet (largest US ethanol producer) - their water use per gallon has decreased 80% since 1987, and energy use has decreased 35% in past 15 years.

      Remember, too, that alternative uses of corn (primarily animal feed) actually use a LOT more water than ethanol production. Also remember that oil production and refining uses a lot of water as well.

      I appreciate your comment that we are creative people and can look for better options. Corn ethanol is at best an imperfect fuel option. But there is no question in my mind that it offers benefits to society relative to oil, and can be a great platform for more improvement over time.

      As for perennials - we will get there, but it will take some time. First we need technology that can use biomass. Once there are cellulosic biofuel facilities buying biomass, then farmers will be more free to experiment with perennials. They will eventually look pretty good economically (and already look great environmentally).

      • Robert Moffitt says:

        October 22, 2013 at 4:21 pm

        “Also remember that oil production and refining uses a lot of water as well…”

        Good point. And few fuels are more carbon and water intensive than fuels refined from Tar Sands oil. That’s where most of Minnesota’s gasoline, diesel and aviation fuel come from.

  • Doug Root says:

    October 22, 2013 at 9:03 am

    The need for biofuels and biobased chemicals is largely driven by the increasing carbon dioxide content of our atmosphere.  If we can replace coal and petroleum with materials of recent biogenic origin, we might be able to make a small dent in the continuous increase in carbon dioxide.  I wonder whether Brendan and GPI have any information about the scale of fossil fuel replacement that would be required and the best case timeframe for any significant decrease in the amount of petroleum and coal extracted, refined, and consumed.  Of course, there are interesting issues around next generation transportation fuels and vehicle performance, which might also be of general interest and I would be happy to hear comments about what will come next and how that will be better than our current set of biofuels.

    • Brendan Jordan says:

      October 22, 2013 at 9:24 am

      You’re going to get me off topic here wink

      To have a chance of addressing climate change, we must reduce GHG emissions by at least 80-90% by mid-century. That will take a truly heroic effort by our society, and will mean making very rapid progress to scale up new technology in a variety of areas. It will take vast investments by public and private sources, major changes in public policy, and likely some major cultural shifts as well. This will not be easy.

      Looking just at transportation - clearly biofuels are only a part of the solution. The Department of Energy and US Department of Agriculture released something called the “billion ton study” - showing how a billion (I think 1.2 billion actually) of biomass could be sustainably produced in the US without significant impacts on other agricultural commodities. All the assumptions get vigorously debated. The study was revised once, and shows results in the same order of magnitude. A billion tons is enough to cover about 1/3 of transportation petroleum use at current levels.

      So what about the other 2/3?

      That will be a combination of the following:

      Lower carbon oil: Yes, that is a real thing. There is a widespread practice in the oil industry called “enhanced oil recovery”, where CO2 is injected into mature oil wells to get more oil out. Most of that CO2 stays in the ground. When you punch the numbers, that oil is lower carbon intensity than average oil. With the right policy, oil producers to inject even more CO2 per unit of oil production and have zero or negative carbon oil. Enhanced oil recovery is a real thing, happening now. We just need to do more of it, and figure out how to do it in areas like the Bakken in North Dakota.

      Electric vehicles: I include here both battery electric vehicles, and hydrogen fuel cell vehicles. They are both entering the market (battery electric vehicles are a bit ahead right now, but give it 5 years and you’ll see both).

      Vehicle efficiency: Driven by more stringent CAFE standards and a re-invented post-crisis auto industry, we are finally improving average vehicle efficiency. We will need to continue doing that.

      Driving less: The cheapest mile is the mile you don’t have to drive. We can reduce the need for vehicle trips by building more walkable and bikable cities, building more public transportation, encouraging more telecommuting, etc.

  • Joe says:

    October 22, 2013 at 9:13 am

    Brendan, I know there are a few reader questions you sill have to answer. When you have time, can you tell us a little about your work in reviving our northern timber industry through diversifying our bio-based industries?

    • Brendan Jordan says:

      October 22, 2013 at 9:31 am

      Glad you asked. Our timber industry is in crisis mode. There has been a wave of shutdowns - OSB mills, paper mills, etc. Part of this was the recession in housing construction, but part of it is structural - reduced global demand for paper for example.

      Timber and mining are some of the few major primary industries in Northeastern Minnesota. Many other industries (restaurants, schools, hospitals, etc) depend on them. They are skilled, relatively high wage jobs. But the timber industry is in decline - timber harvest is down about 50% from its peak. That impact filters down through many other industries - loggers, equipment manufacturers and retailers, etc.

      Biobased chemicals and advanced biofuels offer one of very few opportunities to revive this industry and increase the timber harvest back to historic levels.

  • Lee Egerstrom says:

    October 22, 2013 at 9:26 am

    I have really enjoyed Brendan’s comments and other participants’ comments and questions. This prompts me to make the following comment: Hunger never created a market for Minnesota’s or any other farmers’ crops. Public policy responses to hunger have filled the void between food needs and market forces. The threat of war by itself never built an arms economy for the military-industrial complex. Public policy responses to the threat of war built the industry. Going green, saving the planet and building high-value biomass industries will be helped by potential cost savings and other market forces. But it will take public policy responses in support of research and development, as Brendan proposes, to actually get the job done.

    • Brendan Jordan says:

      October 22, 2013 at 9:42 am

      Amen! Well put.

    • Elaine Mayer says:

      October 22, 2013 at 10:07 am

      Another industry that could help revive the area would be tourism, similar to the Bluff Country in SE MN. It could provide opportunities for school students to learn about the area’s timber and mining, and its unique beauty.

  • Brendan Jordan says:

    October 22, 2013 at 9:55 am

    Thanks everyone for a great discussion. I’m signing off now, but will check back in later to see if there are any stragglers.

  • Doug Root says:

    October 22, 2013 at 10:04 am

    Good comments from Brendan about the limited capacity of biofuels (even at one billion tons of biomass) to address the growing carbon dioxide content of our atmosphere.  Only one third of our transportation fuels can be replaced by sustainable biofuels.  Electric vehicles and hydrogen powered fuel cells still require some source of fuel to make the electricity and hydrogen, but they may be better than hydrocarbon powered vehicles.  The ‘miles we don’t drive’ may be a significant part of the solution and production of fuels and biobased materials from carbon dioxide are interesting areas of research, but have long time lines before implementation at a significant scale.  It seems to me that there is a bright future for renewable fuels and biobased materials, nearly unlimited opportunities, many challenges, and a tremendous need for new knowledge, businesses, and innovations.  I certainly agree that our policies, markets, and practices will continue to change as we try to build a better future.  Thanks for the forum.

    • Robert Moffitt says:

      October 22, 2013 at 4:24 pm

      Or, to put it another way, there is no “silver bullet” solutions, but a “silver buckshot” approach using several alternative fuels, vehicle technologies, mass transportation and conservation just might work.