Like most everyone in the Corn Belt, Eric Woodford heard for years that stalks, husks, and cobs someday would not be discarded as field waste, but valued as the stuff that makes fuel.
Rather than wait for that day, he set out to hasten its arrival.
In the late 1990s, Woodford was running a custom farming operation in Minnesota, collecting corn waste for livestock, feed, and stable bedding. He tinkered for a decade on the equipment to make it do the job faster. In 2008, he patented a device – the powered windguard – that baled husks at the rapid pace he suspected would be necessary to make farm-waste-to-ethanol a real industry.
"We've been excited about cellulosic for a long time," Woodford said. "It's always been a few years away."
Wednesday the wait ends for Woodford and some 450 farms around Emmetsburg, Iowa – customers for his specialized baling equipment. They are all suppliers to Project Liberty, the first large-scale commercial cellulosic ethanol plant in the Corn Belt, set to open Wednesday. A joint venture of corn ethanol giant POET and Dutch biotechnology corporation, DSM, it is the first of three big new cellulosic ethanol plants opening in the U.S. heartland in the coming weeks.
It's a pivotal moment in the quest for a biofuel that can achieve substantial cuts in greenhouse gases.
Better Environmental Profile
Biofuels come with plenty of environmental controversy – their demand for land and competition with food; agricultural water pollution; the risk of increased smog pollution in certain temperatures and conditions. But the scientific consensus is that biofuel is cleaner than petroleum gasoline, and that ethanol made from cellulosic material will have a better environmental profile than fuel alcohol fermented from corn.
The U.S. government's assessment is that lifecycle greenhouse gas emissions for cellulosic ethanol are 60 percent lower than gasoline, far in excess of the modest savings for fuel alcohol fermented from simple starch like corn.
High Price of Corn
The oil industry, emphasizing cellulosic's long struggle to get to market, has been leading a drive to repeal the ethanol mandate in transportation fuels, the so-called Renewable Fuels Standard. In its lobbying drive, it has gained support from the food industry and others concerned that fuel demand is keeping the price of corn high.
"For years, we've heard companies claim they will soon produce large qualities of cellulosic fuel, but these rosy forecasts haven't ever come true," said American Petroleum Institute spokesman Carlton Carroll in an email. "API supports the use of advanced biofuels, including cellulosic biofuels, once they are commercially viable and in demand by consumers. But EPA must end mandates for these fuels that don't even exist."
In fact, the EPA has eased the mandate while waiting for cellulosic to hit the market. This year's proposed cellulosic target – based entirely on the projected output of the three new cellulosic plants – is 17 million gallons, far short of the 1 billion gallons per year that Congress envisioned the industry would be producing by now when it passed the Energy Independence and Security Act in in 2007.
"Nature has spent millennia trying to make it impossible to break down cell walls," said Hugh Welsh, president of DSM North America. "Breaking down biomass requires a cocktail of enzymes that had to be specially designed."
"We've done it now. We can do it at scale, as this plant demonstrates," he added. "For many years this was something that was just over the horizon, but it's here now."
Big Players Involved
DSM, founded more than a century ago as the Netherlands' national coal mining company (Dutch State Mines), has over time divested its fossil fuel holdings and is now committed to a future in technologies that aid the so-called "bio-based economy." Its aim, Welsh said, is to recycle waste into useful products like renewable fuel. The launch of the cellulosic plant is seen as such a landmark event for DSM that King Willem-Alexander of the Netherlands is to attend the opening ceremony.
In Welsh's view, it's no coincidence that opposition to the U.S. renewable fuels policy has ramped up just as the three big cellulosic facilities – Project Liberty in Emmetsburg, Dupont's Nevada, Iowa plant and the Hugoton, Kan. facility built by Spanish multinational Abengoa – are to begin producing the fuel.
With big players involved, the stakes of the game have changed, he said. And so have the politics.
"It's not something that's being done by a small start-up company," said Welsh. "It's being done by extremely large, publicly traded, multi-billion-dollar companies … that have made significant investments. I think that's something that has the oil and gas industry a little bit concerned."
Competitive with Gasoline
Jeff Lautt, chief executive of POET, said that over the past six years, the company has been able to drive down the cost of making cellulosic ethanol from $6 a gallon to $3 a gallon. That's a key achievement in getting it competitive with gasoline.
"When we started our company 27 years ago with a bankrupt corn ethanol plant, there was the same question about that industry as there is about cellulosic: Would it ever be viable?" Lautt said. "We came in and showed the country and showed the world that corn ethanol is viable. We're essentially taking all of that knowledge and expertise and putting it into cellulosic."
Gasoline over Labor Day averaged $3.44 a gallon nationwide, according to AAA. The most concentrated ethanol on the U.S. market, E85 (a blend with gasoline that is 85 percent ethanol), was selling at $3.41 a gallon this spring, according to the most recent government tracking. But because ethanol has less energy content than gasoline – you have to burn more ethanol to go the same distance – ethanol is $4.82 per gallon on an energy-equivalent basis.
Shaving costs further will be important for cellulosic ethanol's viability. But far more important, many analysts and industry players say, are the incentives and mandates set by federal regulators.
'The blend wall'
U.S. gasoline consumption, now at about 369 million gallons per day, is down 6 percent from its peak in 2007. Since then, corn ethanol production has more than doubled to about 36.5 million gallons per day – meaning ethanol already is nearly 10 percent of U.S. fuel supply. Because higher blends of ethanol could cause problems for older cars, the 10 percent figure is known in policy circles as "the blend wall." The oil industry argues that it is impractical to add more ethanol to the U.S. fuel mix.
The ethanol industry maintains there are ways to put more renewable fuel into tanks. At least 20 million cars on U.S. roads are flex-fuel vehicles that can take far higher blends of ethanol, and automakers say that 10 percent is no longer a limitation for new vehicles. The problem is only 2 percent of the nation's filling stations, mostly in the Midwest, offer E85. For cellulosic to make its way onto the market, federal policy will need to do more to encourage distribution of higher blends of ethanol, the ethanol industry says.
But the EPA is being pushed in the other direction by oil interests. Congress in 2007 required that refiners blend 36 billion gallons of ethanol into fuel supply by 2022.That's a 157 percent jump from today's levels, which already are consuming 40 percent of U.S. corn production. Of course, Congress envisioned that 16 billion gallons of that ethanol would be from corn stover and other cellulosic material. Because cellulosic hasn't grown as quickly as projected, the oil industry insists the old goal is simply unworkable.
Jeremy Martin, senior scientist in the Union of Concerned Scientists' clean vehicles program, believes that the EPA will have to adjust the goal downward. But 1 billion gallons of cellulosic by 2020 is an achievable goal, he said, and if the United States is to meet its promises to cut greenhouse gas emissions, it must maintain a commitment to biofuels. The United States can cut oil use in half over the next two decades, UCS scientists say, only with a combination of improved fuel economy, electric cars, and advanced biofuels.
Matching Policy with the 'Real World'
"One of the real keys is going to be demonstrating that we can make this stuff," says Martin. "The promise is here. The opportunity is here. But policymakers are going to have to figure out how to adjust the details of the policy to match what is happening in the real world."
For Woodford, who moved his family from Minnesota to Iowa to sell equipment and work on Project Liberty, the focus is getting farmers and equipment company engineers ready for the biofuel boom.
"If I had invented a car that got twice as good fuel economy, that's something the masses would understand," he said. "Instead, I invented a device to make a baler get twice as good mileage.
"I always was interested in helping this planet last a little longer."
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