January Ethanol Producer Magazine

Page 1

INSIDE: INDUSTRY CLEARS HURDLES, PREPARES FOR NEW ONES JANUARY 2013

Protecting

Profitability In-house Laboratories Integral to Success Page 30

ALSO

Data-Driven Production Page 36

Contamination Prevention Page 38 www.ethanolproducer.com

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contents

JANUARY issue 2013 VOL. 19 ISSUE 1

features

DEPARTMENTS

30

30 QUALITY CONTROL

Measurable Success In-house laboratories can protect profits By Holly Jessen

6

Editor’s Note

Labs Look to Vendors and Each Other for Answers By TOM BRYAN

7

Ad Index

10 The Way I See It

Chin Up and Keep a Stiff Upper Lip By MIKE BRYAN

11 Events Calendar

36

36 Q&A

Keeping Corn Plus in the Sweet Spot Walking in a lab manager’s shoes By Tim Portz

Upcoming Conferences & Trade Shows

12 View From the Hill

The Year That Was

and Will Be By bob dinneen

14 Drive

Expanding Market Access

By TOM BUIS

16 Grassroots Voice

New Year Challenges

By BRIAN JENNINGS

18 Europe Calling

Setting the Example By Rob Vierhout

38

38 FERMENTATION Ferm Assurance

Hygiene is key to preventing contamination By Susanne Retka Schill

20 Business Matters

Co-location Plans

Impact Air Permit By Todd Palmer and Anna Wildeman

22 Business Briefs 24 Commodities Report 26 Distilled 44 Marketplace INSIDE: ASSESSING THE CHALLEGES OF THE YEAR AHEAD JANUARY 2013

CORRECTION Giancarlo Drennan’s name was misspelled in a story published in the December issue of EPM. We apologize for the error.

Protecting

Profitability In-house Laboratories Integral to Success Page 30

ALSO

A Day in the Lab

Page 36

Keeping Bacteria in Check Page 38 www.ethanolproducer.com

Ethanol Producer Magazine: (USPS No. 023-974) January 2013, Vol. 19, Issue 1. Ethanol Producer Magazine is published monthly by BBI International. Principal Office: 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. Periodicals Postage Paid at Grand Forks, North Dakota and additional mailing offices. POSTMASTER: Send address changes to Ethanol Producer Magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, North Dakota 58203.

4 | Ethanol Producer Magazine | JANUARY 2013

ON THE COVER

Sharon Kipp, lab technician, takes a sample at Homeland Energy Solutions LLC. PHOTO: JOHN C. THOMAS, FISHEYE

editor’s note

In the weeks leading up to the completion of this issue, our editors interviewed personnel at multiple U.S. ethanol plant labs, the National Corn-to-Ethanol Research Center and several laband data-focused service companies to deliver on this month’s important lab innovation theme.

LABS LOOK TO VENDORS AND EACH OTHER FOR ANSWERS Tom Bryan, PRESIDENT & EDITOR IN CHIEF tbryan@bbiinternational.com

Tim Portz, our executive editor, stepped inside the well-equipped laboratory at Corn Plus LLLP, in Winnebago, Minn., where he met lab manager Courtney Trask, the subject of this month’s Q&A. In “Keeping Corn Plus in the Sweet Spot,” on page 35, Trask says monitoring and adjusting the performance of an ethanol plant has become a truly data-driven process. She tells us that vendors such as HPLC software reps often guide lab personnel through routine troubleshooting and data analyses. And she verifies that the U.S. ethanol industry—if Corn Plus is typical—continues to make capital investments in new lab equipment, despite tight margins. In fact, Trask says, her biggest challenge right now is not a lack of new technology, but getting comfortable with all of the new equipment and practices in her laboratory. “Our situation is difficult right now because we have implemented so many new things at the plant in the past few months,” she tells Portz. Trask will, of course, lean on her vendors for support and guidance as she continues to master new gadgets and roll out new procedures in her space. Likewise, service providers like Efficient Green Energy are also helping lab personnel bridle new technology and harness better data. As Holly Jessen reports in her page-30 feature, “Measurable Success,” the Iowa-based company is enabling producers to capture and cleanse data, train personnel and benchmark their lab practices against competing facilities. NCERC’s Sabrina Trupia says successful ethanol plant labs are built around three intersecting components: “performance, understanding and communication.” Each component, especially the latter, must be methodical and unremitting. After all, even the best data integrity practices fall flat when internal communication breaks down. External communication is important, too. This is a competitive industry, yet metered collaboration between ethanol plant labs is tolerated, and even encouraged by some producers. In addition to Green Energy’s laboratory benchmarking program, companies like PhibroChem, through its Ethanol Performance Group, are engaging lab personnel in training programs that include analytical round robins between multiple facilities. It’s clear that, in today’s environment, datadriven performance strategies require lean producers to build support groups that include vendors, service providers and—now, more than ever—each other.

For industry news: www.ethanolproducer.com or Follow Us:

6 | Ethanol Producer Magazine | JANUARY 2013

twitter.com/EthanolMagazine

AdIndex

EDITORIAL PRESIDENT & EDITOR IN CHIEF Tom Bryan tbryan@bbiinternational.com

Vice President of Content & EXECUTIVE EDITOR Tim Portz tportz@bbiinternational.com

11 2013 International Biomass Conference & Expo

3 Hydro-Klean LLC

48 2013 International Fuel Ethanol Workshop & Expo

5 ICM, Inc.

CONTRIBUTIONS EDITOR Susanne Retka Schill sretkaschill@bbiinternational.com

FEATURES EDITOR Holly Jessen hjessen@bbiinternational.com

NEWS EDITOR Erin Voegele evoegele@bbiinternational.com

COPY EDITOR

47 2013 National Ethanol Conference

Jan Tellmann jtellmann@bbiinternational.com

ART

8-9 Inbicon

ART DIRECTOR Jaci Satterlund jsatterlund@bbiinternational.com

GRAPHIC DESIGNER Lindsey Noble lnoble@bbiinternational.com

45 BBI Consulting Services

42 INTL FCStone Inc.

13 BetaTec Hop Products

19 Lallemand Biofuels & Distilled Spirits

26 Buckman

29 Methes Energies

43 DuPont FermaSure

34 Nalco Company

35 DuPont Industrial Biosciences

15 Phibro Ethanol Performance Group

17 DuPont Pioneer

21 POET - DSM Advanced Biofuels

27 Fagen Inc.

46 Syngenta: Enogen

41 Gamajet Cleaning Systems, Inc.

22 Tower Performance, Inc.

PUBLISHING CHAIRMAN Mike Bryan mbryan@bbiinternational.com

CEO Joe Bryan jbryan@bbiinternational.com

SALES VICE PRESIDENT, SALES & MARKETING Matthew Spoor mspoor@bbiinternational.com

EXECUTIVE ACCOUNT MANAGER Howard Brockhouse hbrockhouse@bbiinternational.com

ACCOUNT MANAGERS Marty Steen msteen@bbiinternational.com Bob Brown bbrown@bbiinternational.com Andrea Anderson aanderson@bbiinternational.com

CIRCULATION MANAGER Jessica Beaudry jbeaudry@bbiinternational.com

ADVERTISING COORDINATOR Marla DeFoe mdefoe@bbiinternational.com

Senior Marketing Manager John Nelson jnelson@bbiinternational.com

EDITORIAL BOARD Mike Jerke, Chippewa Valley Ethanol Co. LLLP Jeremy Wilhelm, Cilion Inc. Mick Henderson, Commonwealth Agri-Energy LLC Keith Kor, Pinal Energy LLC Walter Wendland, Golden Grain Energy LLC Neal Jakel Illinois River Energy LLC Bert Farrish Lifeline Foods LLC Eric Mosebey Lincolnland Agri-Energy LLC Steve Roe Little Sioux Corn Processors LP

Customer Service Please call 1-866-746-8385 or email us at service@bbiinternational.com. Subscriptions to Ethanol Producer Magazine are free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside the United States, Canada and Mexico. To subscribe, visit www.EthanolProducer.com or you can send your mailing address and payment (checks made out to BBI International) to: Ethanol Producer Magazine Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to 701-746-5367. Back Issues, Reprints and Permissions Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at 866-746-8385 or service@bbiinternational.com. Advertising Ethanol Producer Magazine provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about Ethanol Producer Magazine advertising opportunities, please contact us at 866-746-8385 or service@bbiinternational.com. Letters to the Editor We welcome letters to the editor. Send to Ethanol Producer Magazine Letters to the Editor, 308 2nd Ave. N., Suite 304, Grand Forks, ND 58203 or email to sretkaschill@bbiinternational.com. Please include your name, address and phone number. Letters may be edited for clarity and/ or space.

Please recycle this magazine and remove inserts or samples before recycling

2 Growth Energy

28 Verenium - Ethanol

40 Henderson Auction

32 Vogelbusch USA, Inc.

33 Himark bioGas

23 Wabash Power Equip. Co.

COPYRIGHT Š 2012 by BBI International TM

JANUARY 2013 | Ethanol Producer Magazine | 7

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the way i see it

Chin Up and Keep a Stiff Upper Lip By Mike Bryan

First, let me say Happy New Year! I do hope that the coming year for each of you is very rewarding, both on a personal level and a business level.

The coming year will, of course, bring lots of new challenges for the ethanol industry, but, as we have in the past, I suspect we will prevail. I’m not sure if 2012 was our toughest year ever, but it has to rank right up there in the top two or three. But with the U.S. EPA’s decision not to grant a waiver to the renewable fuels standard (RFS), it at least ended on a bit of a high note. So, we press on, moving into the coming year with some trepidation, but at the same time, confident that we remain on the right side of the issue. There will no doubt be new challenges that will test our mettle, along with new opportunities to demonstrate the viability and importance of renewable energy. Hopefully, Congress is a bit more coordinated and supportive in 2013 than it was in 2012 on the issue of ethanol and renewable fuels in general. Of

10 | Ethanol Producer Magazine | JANUARY 2013

course, only time will tell whether the Obama administration will accomplish more with a still-divided Congress than in his first term or face the same recalcitrant challenges. As with all forms of energy, whether fossil or renewable, public policy is a crucial element in its success or failure. The elimination of the oil subsidies would be a good first step, to begin the process of leveling the playing field. We speak of high corn prices like it’s a bad thing. One of the original premises of the ethanol industry was to provide a mechanism that would support commodity prices while providing a cleaner and safer environment. That certainly has been accomplished. Unfortunately, anyone who knows agriculture, knows that the current high corn price rarely makes its way to the average corn farmer—a good price on the farm, perhaps, but $7.50 a bushel, likely not. So these high corn prices that directly affect the profitability of the ethanol industry, generally are not finding their way to the growers. Who actually gets the $7.50 per bushel? I’ll leave that for another column. So as we move into 2013 with corn prices close to an all-time high and oil prices at their lowest level in some time, it looks as though we are still in for a few months of tough sledding. Plants that have a high debt load are generally the first to fail or temporarily shut down, those with lower debt and cash reserves can ride out the market fluctuations.

But isn’t that true for most industries? When times are tough, low debt and cash on hand rule the day. Often, it’s a matter of timing more than bad financial planning. Timing in terms of when the plant was built, how quickly the debt could be paid down, whether the plant was under-capitalized and if there were unanticipated shifts in markets. So, as they say in merry old England, “chin up and keep a stiff upper lip.” 2013 will be interesting ride. That’s the way I see it.

Author: Mike Bryan Chairman, BBI International mbryan@bbiinternational.com

EVENTS CALENDAR National Ethanol Conference February 5 -7, 2013 Wynn Las Vegas Las Vegas, Nevada

Since 1996, the Renewable Fuel Association’s National Ethanol Conference has been recognized as the preeminent conference for delivering accurate, timely information on marketing, legislative and regulatory issues facing the ethanol industry. With numerous networking opportunities, more business meetings are conducted and contacts made at this conference than any other ethanol conference. 866-497-1232 | www..nationalethanolconference.com

International Biomass Conference & Expo April 8 -10, 2013 Minneapolis Convention Center Minneapolis, Minnesota

Building on Innovation Organized by BBI International and coproduced by Biomass Magazine, the International Biomass Conference & Expo program will include 30-plus panels and more than 100 speakers, including 90 technical presentations on topics ranging from anaerobic digestion and gasification to pyrolysis and combined heat and power. This dynamic event unites industry professionals from all sectors of the world’s interconnected biomass utilization industries—biobased power, thermal energy, fuels and chemicals. 866-746-8385 | www.biomassconference.com

International Fuel Ethanol Workshop & Expo June 10 -13, 2013 America’s Center St. Louis, Missouri

APRIL 8-10, 2013

Minneapolis, MN www.biomassconference.com

Make Plans to Attend REGISTER NOW Interested in Speaking? Presentation ideas and poster abstracts will be accepted through December 14, 2012. Submit in one of five tracks: Track 1: Pellets & Densified Biomass Track 2: Industrial & Commercial Thermal Energy Track 3: Biomass Power Track 4: Biogas & Landfill Gas Track 5: Advanced Biofuels & Biobased Chemicals

"The quality of business relationships built here are second to none." - Stephen S. Reidell, Eagle Innovations

Where Producers Meet Now in its 29th year, the FEW provides the global ethanol industry with cutting-edge content and unparalleled networking opportunities in a dynamic business-to-business environment. The FEW is the largest, longest-running ethanol conference in the world—and the only event powered by Ethanol Producer Magazine. Visit our website to reserve premium booth space now. 866-746-8385 | www.fuelethanolworkshop.com

Algae Biomass Summit September 30 - October 3, 2013 Hilton Orlando Orlando, Florida

This dynamic event unites professionals from all sectors of the world’s algae utilization industry including, but not limited to, financing, algal ecology, genetic systems, carbon partitioning, engineering and analysis, biofuels, animal feeds, fertilizers, bioplastics, supplements and foods. Organized by the Algae Biomass Organization and coproduced by BBI International, this event brings current and future producers of biobased products and energy together with algae crop growers, municipal leaders, technology providers, equipment manufacturers, project developers, investors and policy makers. The event is the world’s premier educational and networking junction for the algae industry. 866-746-8385 | www.algaebiomasssummit.org

866-746-8385 | service@bbiinternational.com |

#IBCE13 Follow Us: twitter.com/biomassmagazine JANUARY 2013 | Ethanol Producer Magazine | 11

view from the hill

The Year That Was and Will Be By Bob Dinneen

What a year 2012 has been. We’ve completed the hard work necessary to introduce E15 as a new fuel and now the rollout has begun. E15 is now for sale in Iowa,

Out

In

RFS Waiver Battle

RFS Legislative Battle

E15 Test Programs

E15 at the Pump

Kansas and Nebraska. We’ve also endured a historic drought that caused economic pain and emotional discomfort for farmers in the Midwest, livestock and poultry producers nationwide, and a 15 percent reduction in ethanol production resulting in a handful of plants shuttering until financial conditions improve. As if that weren’t enough, the fierce battle to protect the renewable fuel standard (RFS) is already underway. Fortunately, the facts proved once and for all that the RFS is working and flexible, thus no waivers were granted by the U.S. EPA this year. 2013 may have a rocky start for the industry, but there is also good news on the horizon, especially as we watch cellulosic companies move from the promising talk of the future to meaningful production of ethanol at market scale. As important as these innovations are and as serious as the challenges facing us are, it is always good to take time and reflect on the year that was and will be, with a certain amount of levity, of course.

RFA Chairman Woodside

RFA Chairman McKinstray

RIN Fraud

RIN Depletion

13.2 BGY RFS Ethanol Demand

13.8 BGY RFS Ethanol Demand

E15 Registration

RFA Misfueling Mitigation Plan (MMP)

API RFS “Revisions”

API RFS “Repeal”

Cellulose Demonstration

Commercial-Scale Cellulose Production

EU Countervailing Duty Case

EU Food Crop Biofuel Limitation

Energy Cmte Chairman Bingaman

Energy Cmte Chairman Wyden

Four-Gallon Minimum Purchase

E10 Dedicated Hose

Margo Oge

Chris Grundler

Carbon Accounting Debate

Carbon Tax Talk

UNICA’s Marcos Jank

UNICA’s Elizabeth Farina

Mad Cows

Angry Birds

E15 Auto Concerns

2013 E15 Auto Warranty Coverage

API RFS Lawsuits

More API RFS Lawsuits

South Dakota’s Suboctane Gas

Higher-Octane Fuel Nationwide

Big Oil Funding Campaigns

RFA PAC

As is tradition, I give you 2013’s In and Out list:

Food-Before-Fuel Campaign

Fuels America Campaign

12 | Ethanol Producer Magazine | JANUARY 2013

Author: Bob Dinneen President and CEO, Renewable Fuels Association 202-289-3835

Put BetaTecŽ natural hop extracts to work in your fermentation process to replace antibiotics and enhance yeast propagation. IsoStabŽ is the natural way to effectively control gram-positive bacteria while eliminating antibiotics and harsh chemicals. Plus, antibiotic-free DDGS adds value to your co-products. VitaHopŽ Silver yeast nutrient enhances yeast performance and vitality, inducing faster fermentations and larger yields. Combined with BetaTecŽ fermentation expertise and training, these technologies will significantly increase your plant’s efficiency. BetaTecŽ‌the natural hop to higher profits. For more information specific to fuel ethanol producers, visit www.bthp.info. 4HJ(Y[O\Y )S]K :\P[L >HZOPUN[VU +* ;! -! www.betatechopproducts.com

DRIVE

Expanding Market Access By Tom Buis

Happy New Year to all of you in the ethanol industry, who, in my opinion, are part of one of the greatest success stories in the history of America! While this past year has been one of the most challenging we have ever faced, and we certainly understand we will face more challenges in the new year, we have won every hurdle that Big Oil and Big Food have thrown at us, and we will continue that success this year. We won numerous legal battles against Big Oil and Big Food in 2012—we won the battle over the waiver of the renewable fuel standard (RFS) and we stopped them on the legislative front from dismantling the RFS. In 2013, we will see some of the greatest challenges and opportunities in history for our industry—and we are prepared for both. Big Oil and Big Food will again make an all-out assault on the RFS, we will continue to face unfair trade practices from Brazil, barriers to open trade to the European Union, a bizarre regulatory scheme in California, and every conceivable hurdle to get more market access for E15 and higher blends. And we will succeed.

14 | Ethanol Producer Magazine | JANUARY 2013

Our biggest challenge and opportunity in the New Year is market access. One of the reasons Growth Energy was formed was to anticipate and respond to what our industry needs to succeed. We recognized that one of the biggest obstacles for our industry was the impending blend wall. In March 2009, we filed the waiver to increase the ethanol blend up to 15 percent, recognizing that fuel consumption in America was declining and that our industry had the capacity to produce more than enough to meet the 10 percent regulatory cap. While our opponents have erected every regulatory and legal hurdle imaginary to prevent higher blends, we expect to overcome these hurdles this year. Our big focus will be working with retailers to get E15 and flex-fuel pumps into more retail establishments nationwide. We will continue to work with pump manufacturers to offer minimal cost retrofit kits for retailers. And, we will pursue regulatory changes to address the Reid vapor pressure problem, the minimum purchase requirement obstacle and all the other regulatory hurdles impeding the adoption of higher blends. This year we will have a new Congress and an Obama administration supportive of renewable fuels, creating an opportunity to further promote our industry. We cannot take things for granted, however, we need every one of you to engage with your members of Congress to ensure our industry’s future. Everyone recognizes what a tough year 2012 was. Our industry is a winner, and winners succeed, and we will succeed

because we have the facts on our side. Whether it’s food versus fuel, environmental benefits or savings to consumers, we are a great benefit to all Americans. But we cannot sit back and hope for success, we must stand up and fight for our industry. At Growth Energy, we will be leading the fight for our industry and urge you to do the same. American ethanol is a win for America. We have reduced our dependence on foreign oil. We are now 10 percent of America’s fuel supply. We have created more than 400,000 jobs in the U.S.—jobs that cannot be outsourced overseas. We generate more than $50 billion in gross domestic product. We have improved our nation’s air quality and our environment, revitalized our rural economy, and saved consumers money at the pump. Because of you, our industry is one of the greatest American success stories. Let’s continue to spread the message. On behalf of everyone at Growth Energy, we wish you a Happy New Year! Author: Tom Buis CEO, Growth Energy 202-545-4000 tbuis@growthenergy.org

Protect your productivity.

You know that bacterial contamination affects yield. A recent study shows that infections can decrease yield up to 27%*. LACTROL® from Phibro Ethanol Performance Group controls troublesome bugs. It keeps your plant running better and longer between CIP treatments. LACTROL is the proven solution to maximize yields and productivity. It keeps input costs down by helping you squeeze more ethanol out of every kernel of corn. No wonder LACTROL is used in more ethanol plants than any other antimicrobial. ® Prevent, protect, and produce. Take microbial control seriously; make sure your plant knows about LACTROL . Contact your Phibro Ethanol Performance Group Sales Specialist at 800-223-0434.

LACTROL

*5-year study by USDA-ARS National Center for Agricultural Research, Peoria, IL © 2010, Phibro Animal Health Corporation. LACTROL is a registered trademark of Phibro Animal Health Corporation and its affiliates.

GRASSROOTS vOICE

New Year Challenges By Brian Jennings

The new year rings in a number of daunting challenges for U.S. ethanol producers. Gasoline use continues to fall off and the blend wall remains at a standstill, so producers are selling into a market that is on the decline and artificially limits ethanol use. Otherwise, uneconomical imports from Brazil are flooding the U.S. due to biased trade policy and bizarre indirect land use change scoring by the U.S. EPA, adding to ethanol’s supply/ demand imbalance. Corn supplies are tight and margins are even tighter. If that weren’t enough, the battle over the renewable fuel standard (RFS) continues. Against this backdrop, producermembers of the American Coalition for Ethanol recently met to help determine the action plan that our grassroots advocacy needs to pursue in 2013. Among the many priorities identified by these members, a few rise to the top. Market access is clearly our industry’s top priority. ACE provides unmatched expertise in helping petroleum marketers understand the benefits of ethanol blends and blender pumps, so we will focus on expanding ethanol use by continuing to collaborate with petroleum marketers and automakers this year. E15 is the most important opportunity to expand ethanol use in the short-term. ACE will prioritize educating retailers about the benefits and

16 | Ethanol Producer Magazine | JANUARY 2013

availability of E15 and launch some new and creative ways to overcome the hurdles standing in the way of more E15 use. We are also working with automakers to identify the higher ethanol blends that will provide the valuable octane needed for future engine technologies. Developing the market for E15 in the short-term and higher ethanol and octane opportunities in the long-run depend upon the market access created by the RFS. That’s why another priority for ACE in 2013 will be to win the RFS battle to secure a place in the market for higher ethanol blends. It would be nice if free market principles cleared the path to more ethanol use. Let’s recall, however, what a truly free market does: it rewards low-cost alternatives, it promotes innovation, and a free market fosters competition. Despite the fact that ethanol is the low-cost alternative and ethanol producers are innovating and becoming more efficient, left to their own devices, oil companies—our customers— wouldn’t use as much ethanol as called for under the RFS because they control the market. An old saying about Capitol Hill applies to our industry’s relationship with oil companies: there’s no such thing as a permanent victory or permanent defeat, just permanent battles. Yes, oil companies are our customers. But make no mistake, in D.C., they are our fierce competitors. Winning the EPA decision over whether the RFS should be waived was anticlimactic because we knew the facts and law were on our side. But the battle continues as Big Oil and other opponents simply turn the page in their game plan to now seek repeal of the RFS in Congress. Given all the tax benefits and artificial market advantages enjoyed by

oil companies, the RFS is the only tool we have to try and level the playing field. As the first group to advocate for an RFS, ACE will be aggressive in drawing attention to its success. Our opponents will claim to Congress the RFS is broken and in need of “repair” (i.e. repeal). Our job will be to explain that the RFS is working and delivering important benefits to America. ACE will also continue to be active in mobilizing strong grassroots support for ethanol, taking steps to activate members to stand up and promote the benefits of ethanol in their communities, states and with federal policymakers. Several years ago we initiated the first ethanol industry fly-in to the nation’s capital; this grassroots event will be held again March 13 and 14. The facts are on our side, but if our opponents are louder and more visible in the halls of Congress, the alternative reality they are trying to create about ethanol becomes fact. We are also supporting the Fuels America campaign designed to go on offense and reframe the public conversation about ethanol, an effort that is long overdue. Our forward-looking action plan to expand market access alongside automakers, retailers and policymakers will only succeed with your support and involvement. That’s why it is critical to remain engaged. Join us in D.C. for the ACE fly-in. Take action in your communities. Be part of our grassroots team and take an active role in ACE’s mission of making American ethanol the consumer fuel of choice.

Author: Brian Jennings Executive Vice President, American Coalition for Ethanol 605-334-3381 bjennings@ethanol.org

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Europe Calling

Setting the Example By Robert Vierhout

The decision by the U.S. EPA to deny a waiver on the renewable fuel standard (RFS) was the right decision. With this statement I will

probably only echo what many colleagues in or related to the ethanol sector have said already. Clearly, the decision is good news for the American ethanol sector, but it should also be important for those who design policy and adopt laws at the other side of the pond in Europe. The EPA decision gave at least two clear messages to those who favored the waiver and to the rest of the world: First of all, the food/fuel issue was greatly exaggerated, and secondly, the RFS has an in-built flexibility that makes a waiver on the mandate unnecessary. The EPA officials were able to distinguish fact from fiction when they made their assessment on the impact of ethanol production on commodity prices, the food and the feed market. Hopefully, European regulators will take note of what has happened. If they are intellectually honest, they should acknowledge that if the U.S. biofuel policy has no real negative impact on the food/feed market, then surely the European policy cannot have any impact at all. Compared to the U.S. volumes, the European volumes are simply too small to have any significant impact. Even the estimated volumes for 2020 are small,

18 | Ethanol Producer Magazine | JANUARY 2013

comparable in size with today’s ethanol production in the U.S. Unfortunately, EU regulators seem to be under the spell of Big Food and the self-righteousness NGOs no one seems to question. I have always wondered why there is this anxiety in the EU around food. Europe has become the biggest food importer in the world since it reformed the European Common Agricultural Policy. This reform was partly the result of international trade agreements. Land the size of Germany (35 million hectares, or 86 million acres) is needed outside Europe to feed Europeans. The result is that Europe has taken arable land out of production year-onyear and we have created a huge protein deficit. It is not that we couldn’t produce these proteins ourselves, but we cannot do it competitively with soymeal. As the EU common agricultural policy no longer allows production support for farmers, we have no other option but to import protein, importing 35 million metric tons of soymeal annually to feed animals. We reduced arable land use in Europe for another reason. In 2006, under pressure of a World Trade Organization ruling, Europe reduced its sugar production by 6 million tons, equal to 700,000 hectares. A total of 83 sugar refineries had to be closed. Europe was restricted in its sugar exports and mainly Brazil is benefiting from this situation. This 700,000 hectares can be used for growing wheat or corn for ethanol production. It would not impact on land outside the EU, nor commodities for food use. According to the Food and Agriculture Organization of the United Nations, the EU

is taking 500,000 hectares of arable land out of production each year. Yet, it seems that this is not enough; another 7 million hectares should be taken out of production to boost green farming. At least that is what the European Commission proposed as part of another reform of Europe’s agricultural policy. All in all, Europe seems to have too much land. In any case, there certainly seems to be enough land to produce biofuels and at the same time reduce the protein deficit via distillers grains. These land facts, plus the EPA decision, should have an impact on European politicians who are gifted with common sense thinking. The EPA has set a clear example and the EU should follow. In any case, Europe’s plan to limit conventional biofuel, and even prevent its production beyond 2020, will not change America’s view on its biofuel policy. America’s ethanol is needed to reduce America’s addiction to oil and to become less dependent on the Middle East—considerations Europe doesn’t yet care about.

Author: Robert Vierhout Secretary-general, ePURE Vierhout@epure.org

business matters

Co-location Plans Impact Air Permit By Todd Palmer and Anna Wildeman

Given the state of the economy and the high price of corn, many ethanol producers are exploring cost-reduction strategies, including partnering and co-locating with innovative noncorn feedstock producers and grain storage facilities. These strategies may create excellent opportunities for consolidation and new growth, however, they may also have significant permitting implications pursuant to the federal Clean Air Act and stateimplemented air permit programs. For stationary sources that emit pollutants above certain thresholds, including most ethanol production facilities, the CAA requires permits be issued prior to construction and operation. Such permits are typically issued to an individual facility owner or operator and dictate very specific operational, pollution control and recordkeeping requirements. In the CAA, if certain factual criteria are met, two different stationary sources may be considered a single stationary source and regulated as such, requiring each to account for the others’ emissions, construction projects, modifications and compliance determinations. The test for determining if two facilities should be considered a single stationary source is well-defined in federal and state-delegated statutes and rules. For two facilities to be considered a single stationary source, they must: 1) be on contiguous or adjacent property, 2) belong to a single major industrial grouping, and 3) be under common control by the same entity. (CAA 20 | Ethanol Producer Magazine | JANUARY 2013

40 C.F.R. § 52.21(b)(6). In other words, two facilities must satisfy all three criteria before an agency can regulate them as a single stationary source. The first criteria is not always a straightforward analysis. If two facilities are physically located on contiguous or adjacent properties, then this criteria is satisfied. U.S. EPA guidance has broadened this concept, however, such that two facilities that are physically separated by several miles can nonetheless be considered a single source, if the two are functionally related. Courts have added uncertainty by challenging EPA on this broadened interpretation. Therefore, a source may want to consult with an attorney if two projects are to be separated by less than 20 miles. The second criteria, belonging to a single major industrial grouping, may appear straightforward, but as with most elements of the CAA, this analysis is complicated by EPA guidance. The Standard Industrial Classification code system classifies facilities to determine applicable federal and state regulatory programs. There are 10 divisions of SIC codes, each representing an industry sector, and within each division are multiple subsets called “Major Groups.” (See www. osha.gov/pls/imis/sic_manual.html for more information on the SIC code system.) A plain reading of the second criteria indicates that if two facilities operate under the same SIC code, the second criteria is satisfied; and if under different SIC codes, it is not. EPA has issued guidance, however, suggesting that the regulator can completely disregard the SIC codes, even if different, and require an

additional “support facility” analysis based on various criteria developed by EPA. Importantly, the “support facility” analysis and criteria have never been promulgated as a rule by EPA; rather, the concept is discussed in a preamble that has never been promulgated as a rule. The third criteria, common control, requires a more fact-intensive evaluation. To determine if two facilities would be considered under common control, EPA generally relies upon the Securities and Exchange Commission definition, which is “the possession, direct or indirect, of the power to direct or cause the direction of management and polices of a person, whether through the ownership or voting shares, by contract, or otherwise.” This criteria has been the subject of numerous administrative interpretations and judicial decisions, resulting in significant case precedent and EPA guidance. Because this criteria is highly fact-specific, facilities must carefully consider available guidance and should consult with an attorney prior to determining whether two facilities satisfy this criteria. In summary, ethanol producers considering new partnerships and colocations must be aware of potential air permitting implications, and resulting operational and management complications that can arise.

Authors: Todd Palmer Partner, Michael Best & Friedrich 608-283-4432 tepalmer@michaelbest.com

Anna Wildeman Associate, Michael Best & Friedrich 608-283-0109 ajwildeman@michaelbest.com

business briefs

People, Partnerships & Deals

RSB Services Foundation, the implementing entity of the Roundtable on Sustainable Biofuels, which has developed a Global Sustainability Standard and Certification System for Slade has worked as biofuel production, a scientist and held has added John Slade sales positions in North America, Asia, India and as regional director Australia. for business development in North America. Slade has nearly 20 years of experience in the biofuels industry in North America and Asia. He has spent most of his career in the enzyme business. Prior to joining the RSB, Slade served as a strategic consultant for DSM NV, and spent 17 years at Novozymes. He has also held positions at Cargill Inc. and currently holds two biotechnology application patents. Archer Daniels Midland Co. has named Gary Towne as vice president of ADM Corn Processing. Towne previously served as chairman of the management board of Alfred C. Towne joined ADM in 1997 and most Toepfer Internarecently led the ACTI tional G.m.b.H., a organization. global grain merchandising company that is 80 percent owned by ADM. He also previously served as ADM’s manager of Global Risk and Ethanol. In addition, ADM has named Domingo Lastra as chairman of the management board of ACTI. He previously served as president of ADM South America and as ADM’s vice president of Business Growth.

22 | Ethanol Producer Magazine | JANUARY 2013

Highwater Ethanol LLC has added Luke Schneider as its chief financial officer. Prior to joining Highwater Ethanol, Schneider served as chief financial officer for Heron Lake BioEnergy LLC., where he also held a variety of other positions, including senior accountant and staff accountant. The appointment became effective Dec. 3, and coincided with the resignation of Brian Kletscher from the position of interim chief financial officer. Kletscher will continue as the company’s CEO. Platts, a division of the McGraw-Hill Companies Inc., has completed its acquisition of Kingsman SA, a privately held, Switzerland-based provider of price information and analytics for the global sugar and biofuels markets. The acquisition will expand Platts’ capabilities in biofuels, provide an entry into the agriculture markets and add skills in fundamental market analysis. Kingsman offers a range of daily, weekly and monthly reports covering ethanol, biodiesel and sugar. As a unit of Platts’ new agricultural group, Kingsman will continue to offer its existing product portfolio under the Kingsman brand led by its founder, Jonathan Kingsman. Industrial enzyme producer Novozymes and cellulosic biofuel company Beta Renewables, part of Gruppo Mossi & Ghisolfi, have announced an agreement to jointly market, demonstrate and guarantee cellulosic biofuel solutions. As part of the agreement, Novozymes will acquire a 10 percent share in Beta Renewables, paying approximately $115 million for the equity, marketing fees, other intellectual property rights and milestone payments. The two companies will offer customers looking to produce biofuels from agricultural residues, energy crops and other cellulosic feedstocks a combination of Novozymes Cellic enzymes and Beta Renewables’ Proesa engineering and production technology.

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to: Business Briefs, Ethanol Producer Magazine, 308 Second Ave. N., Suite 304, Grand Forks ND 58203. You may also fax information to 701-746-8385, or email it to evoegele@bbiinternational.com. Please include your name and telephone number in all correspondence.

Evogene Ltd., a developer of improved plant traits for the food, feed and biofuel industries, has announced the launch of its Phenomix platform, which utilizes advanced proprietary technologies for the collection, storage and integrated analysis of vast amounts of phenotypic data directly from the field. Through the use of Phenomix, Evogene researchers can evaluate crop behavior in environments closely resembling growth conditions existing in commercial agriculture. The two key data types utilized by Evogene’s infrastructure for improving plant traits are phenotypic and phenotypic. Phenomix provides a direct field-to-computer research communication channel that constantly streams physiological, structural and environmental data inputs from the field. The platform was successfully validated in an 18 acre field trial of various wheat varieties. Atlas Commodity Markets has announced the promotion of Bob Shults to president of Atlas Commodity Holdings. Shults is a cofounder of the firm, and has been responsible for daily operations and development of its business since July 2006. In his new role, Shults will ensure strategic focus on new opportunities and manage the changing regulatory environment. Prior to founding Atlas, Shults served as managing direct of commercial services and a member of the executive management committee for APX Inc. He also served on the board of directors of the Environmental Markets Association. He has more than two decades of experience in the energy sector in trading, origination, risk management, technology, operations, accounting, regulatory, strategy, project management, and project development.

Green Plains Renewable Energy Inc. has entered into an asset purchase agreement to sell 12 grain elevators located in northwestern Iowa and western Tennessee to the Andersons Inc. The sale involves approximately 32.6 million bushels, or 83 percent, of its agribusiness storage capacity and all of its agronomy and retail petroleum operations. The estimated sales price for the facilities and certain related working capital is $133.1 million, including the assumption at closing of term debt of approximately $28.3 million. RC Fuels has announced the addition of Rex Roehl as its business development director. In his new position, Roehl will further develop the company’s growing portfolio of national and regional accounts for its Rich Yeast product portfolio. Prior to joining RC Fuels, Roehl served in business development and asset management roles at Indeck Energy Services. He has also served on the boards of several ethanol plants for Indeck, including Big River Resources and Highwater Ethanol. RC Fuels’ Rich Yeast is a proprietary product designed as a drop-in replacement for conventional yeast for fermentation that reduces the need for preprocess enzymes, reducing production costs for a typical plant. The U.S. Grains Council has announced the official approval of the Syngenta corn variety MIR 162 Agrisure Vipterra in the EU, opening the door for exports of U.S. distillers dried grains with solubles. The decision came after years of industry leadership and efforts, especially those partners of the USGC in the EU, including COCERAL, FEFAC and the Irish Feed Millers Association.

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commodities Natural Gas Report

2012 saw record low prices, increased demand Nov. 26—Two notable developments emerge, looking back at the year just closed. First, natural gas prices hit a 13-year low in the spring of 2012 with NYMEX prices under $2 per MMBtu. The price collapse was driven by a combination of record-high natural gas production volumes and anemic demand due to soft weather-related demand over the winter and continued lagging industrial demand. As the accompanying chart shows, the industry exited winter with storage inventory levels drastically higher than fiveyear average levels, fueling concerns that existing production would have to be curtailed by late summer if storage facilities filled and there was no place for natural gas production to go. This potential outcome is shown by the broken black line that assumed inventory builds would follow historic patterns. This

fear pushed prices down close to variable operating cost levels in anticipation of stranded supply. The second development is tied to the first. With low natural gas prices, demand was stimulated. Both industrial users and electric generators that had burned coal as a primary fuel source for years found that natural gas was now cheaper. As industrials and electric utilities switched to natural gas, demand picked up significantly. The chart shows that post-spring storage inventories built at a much slower rate than the five-year average fill rate due to higher de-

By Casey Whelan

mand. A supply crisis was avoided and natural gas prices rose during most of the summer season. Interestingly, natural gas prices are now roughly double the level experienced last spring.

Corn Report

Corn market vulnerable to South American developments Nov. 26—The corn market is trying to balance this year’s short supply with potentially big plantings next spring. Corn demand could be impacted by higher prices as the rationing began in earnest early this past summer. For example, corn exports sales this marketing year have been 470 million bushels compared to 860 million bushels last year at this time, with the USDA projecting export demand at 1.150 billion (bln) bushels. As a result, will the current corn carry-out of 647 million bushels increase as the marketing year continues? Overall the USDA has ethanol corn consumption at 4.50 bln bushels. Ethanol production in this corn marketing year can justify the current rate. Livestock feeding leaves corn demand at 4.15 bln bushels. Therefore, with total demand at 11.167 bln bushels, and a supply of 11.814 bln bushels, the U.S. corn carry is projected today at 647 million bushels.

BY JASON SAGEBIEL

Now with world carry-out sitting just Traders will be keeping an eye on the U.S. under 119 million metric tons compared and global economy while evaluating the to 132 mmt last year, one must understand potential wheat crop in the hard red winter the potential impact of Argentina and Bra- wheat areas. zil weather. Any production concerns will leave this market vulnerable to sharp US Corn Exports (million bushel) Source: USDA and violent price 2600 swings. The tight 2400 world soybean situation can easily im2200 pact corn direction 2000 during the Southern Hemisphere grow1800 ing season. 1600 In addition to the concerns above, 1400 U.S. producers have 1200 been slow to move corn into the pipe1000 83 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04 05 06 07 08 09 10 11 12 line after harvest.

24 | Ethanol Producer Magazine | JANUARY 2013

report

Regional Ethanol Prices Front Month Futures (AC) $2.392

($/gallon)

REGION

SPOT

RACK

West Coast

$2.535

$2.750

Midwest

$2.385

$2.700

East Coast

$2.485

$2.891 SOURCE: DTN

Regional Gasoline Prices

DDGS Report

DDGS supplies adequate on weak demand BY SEAN BRODERICK Nov. 26—Just before Thanksgiving, DDGS prices had dropped from the previous month. Export demand, particularly from the container market in Chicago, was down significantly, mostly due to DDGS prices being well above the price of delivered corn. As the weather gets colder and more cattle go into the feedlot, we normally start to see domestic demand start to pick up this time of year, which we are starting to see now. Feeding margins are mildly positive, a contrast to ethanol margins, which are negative to break-even. With most plants running at full production, it does not appear as though DDGS supply will be compressed. Looking ahead, several factors will af-

fect DDGS prices, corn supply being foremost. Water levels on the Mississippi that are near historic lows are likely to impact Gulf exports. Asian demand, especially from China, needs to pick up from what it is now. We are keeping our eye on their new mandate requiring U.S. ethanol plants to be registered, which has been an arduous process. South American shipment issues will need to improve, or we will be shipping more out of the U.S. Gulf, even if it is higher-priced, because we actually are able to do it efficiently. Overall, though, the market has, and will continue to be, dictated by the overall demand for export containers.

Front Month Futures Price (RBOB) $2.744

($/gallon)

REGION

SPOT

RACK

West Coast

$2.848

$2.968

Midwest

$2.770

$2.812

East Coast

$2.810

$3.216 SOURCE: DTN

DDGS Prices ($/ton) location

JAN 2013

DEC 2012

Minnesota

240

260

JAN 2012 195

Chicago

258

278

227

Buffalo, N.Y.

250

285

232

Central Calif.

312

324

260

Central Fla.

280

308

223 SOURCE: CHS Inc.

Corn Futures Prices Date

(Mar. Futures, $/bushel)

High

Low

Close

NOV 26, 2012

7.57

7.46

7.51 1/4

OCT 26, 2012

7.46 1/2

7.39

7.39 3/4

NOV 26, 2011

6.00 3/4

5.88 1/4

5.90 SOURCE: FCStone

Cash Sorghum Prices ($/bushel) LOCATION

Ethanol Report

Ethanol supplies move in wide ranges BY RICK KMENT

Nov. 26—The impact of Hurricane Sandy and winter storms in the Northeast created some wild and unexpected reactions in the ethanol market. The challenge of returning to normal for many in New York and surrounding states caused a swift and strong decrease in ethanol inventory levels through the first half of November. This also started a yo-yo effect through the market, creating additional build-up in overall supplies just before the Thanksgiving holiday, with total ethanol stocks 8.5 percent higher than last year. This could add challenges in the ethanol market through the first half of 2013 when demand for gasoline and ethanol starts out extremely sluggish across the country. The inability to significantly reduce inventory levels on a consistent

basis, even with total ethanol production trailing 2011 levels, may create additional long-term pressure on the industry and keep overall plant margins extremely thin, if positive at all. The corn market softened after harvest and it appears nearby prices will remain comfortable in a narrow-to-moderate range between $7.20 and $7.50 per bushel. This will likely keep ethanol plant margins either in the red or extremely narrow for the foreseeable future, and may continue to limit overall production levels. Unless a significant shift is seen before the end of the year, the industry is expected to carry large inventory levels and steady production into 2013. This may create the same concern over an “ethanol glut” that cast a shadow over the first half of 2012.

NOV 21, 2012

OCT 19, 2012

NOV 28, 2011

Superior, Neb.

7.14

7.27

5.77

Beatrice, Neb.

7.04

7.21

5.62

Sublette, Kan.

7.22

7.31

5.67

Salina, Kan.

7.21

7.39

5.99

Triangle, Texas

7.48

7.19

5.56

Gulf, Texas

7.36

7.24

6.70

SOURCE: Sorghum Synergies

Natural Gas Prices

($/MMBtu)

LOCATION

Nov 26, 2012

NOV 1, 2012

DEC 1, 2011

NYMEX

3.74

3.47

3.36

NNG Ventura

3.65

3.83

3.53

CA Citygate

3.68

3.81

3.81

SOURCE: U.S. Energy Services Inc.

U.S. Ethanol Production

(1,000 barrels)

Per day

Month

End stocks

817

24,511

20,044

AUG 2012

845

26,194

19,369

SEP 2011

886

26,588

18,465

SEP 2012

SOURCE: U.S. Energy Information Administration

JANUARY 2013 | Ethanol Producer Magazine | 25

distilled The global energy map is changing

Billion $250

Ethanol News & Trends

Global Renewable Energy Subsidies $1200 billion

$200

A new report pub$150 lished by the International Energy Agency predicts $2600 billion $100 drastic changes in the world energy market. The report, $50 titled “World Energy Out$960 billion look 2012,� indicates that 2011 2015 2020 2025 2030 2035 global energy demand will Biofuels *Data sourced from Electricity increase by more than oneInternational Energy Agency 2011-2035 2012-2035 Existing capacity third by 2035, with China, India and the Middle East global bioenergy resources are more than sufficient accounting for 60 percent of the increase. The report also noted that the U.S. to meet the world’s projected biofuel and biomass is on track to become the world’s largest oil produc- supply without competing with food production. Energy-related CO2 emissions are also expecter in the world, becoming a net exporter by 2030. ed to increase, from 31.2 gigatonnes in 2011 to 37 Regarding renewable energy, the IEA says that gigatonnes in 2035. In response to the report, the consumption of biofuels and biomass is expected Global Renewable Fuels Alliance pointed out that to increase four-fold, with increasing volumes beethanol production alone can reduce greenhouse ing traded internationally. The report also notes that gas emission by 100 million tons globally.

Scaling back costs. How a U.S. ethanol plant cut acid usage and evaporator cleaning frequency by switching to BulabÂŽ 8301 scale control from Buckman. The challenge. A Midwestern ethanol plant relied heavily on sulfuric acid to lower pH. Unfortunately, acid availability was tight, driving costs up significantly.

The solution. Buckman applied FDA-allowed BulabÂŽ 8301 just ahead of the first evaporator resulting in outstanding scale control and process pH control.

The savings. s 3AVED ON PLANT SULFURIC ACID USAGE RESULTING IN NET SAVINGS OF TO YEAR s 4EN #)0 S PER YEAR WERE ELIMINATED SAVING LABOR DOWNTIME AND CHEMICAL COSTS FOR ACID WASH s (YDROBLASTING FREQUENCY AND TIME WAS REDUCED s /VERALL HEAT TRANSFER PERFORMANCE HAS BEEN IMPROVED WHICH PROVIDES ADDITIONAL mEXIBILITY TO optimize water balance and backset usage. s ! REDUCTION IN $$' SULFUR CONTENT WAS OBSERVED

Find out more. 4O LEARN MORE ABOUT OUR "ULABÂŽ SCALE CONTROL PROGRAM FOR EVAPORATORS OR HEAT EXCHANGERS contact your local Buckman representative. Let us give you a story worth telling.

Š2012 Buckman Laboratories International, Inc.

New enzyme offers increased yields Novozymes has launched Avantec, a new enzyme for corn-ethanol production. The enzyme enables ethanol producers to increase yields by as much as 2.5 percent. According to Peder Holk, Novozymes executive vice president, his company has been working on the innovation for a significant period of time. With the use of Avanec, a typical 100 MMgy ethanol plant in the U.S. could reduce its corn input from 900,000 tons to 877,500 tons while maintaining its ethanol production level. The enzyme was tested during trials at ethanol plants, where yields increased from 0 to 4 percent, with an average increase of 2.5 percent. Holk specifies that the amount of residual starch that a plant can convert to ethanol with Avantec depends on the exact configuration of the plant and other factors.

distilled

Ontario demonstration plant begins operations

Researchers propose new carbon accounting method

Woodland Biofuels Inc. began commissioning of its Sarnia, Ontario, cellulosic demonstration facility in October. Located at the Bio Industrial Innovation Center, the facility is capable of handling 7.2 metric tons of wood waste per day, which equates to approximately 2,400 metric tons per year. Woodland Biofuels’ thermochemical process is based on its Catalyzed Pressure Reduction technology. Biomass enters a standard gasifier, where it is processed into syngas. The syngas is then passed through a series of catalyzed chemical reactions to convert it into ethanol. By late March, the company expects to have gathered enough data to support the development of a commercial-scale facility. Woodland Biofuels is initially targeting wood waste as a feedstock, and is looking in Ontario and the southeastern U.S. for the future site of its first commercial facility. “The forest industry in North America has seen better days,” said Greg Nuttall, CEO of Woodland Biofuels. “There are hundreds of potential sites.”

Estimated ILUC factors In a recent research 30 years annualization Baseline time accounting paper, Jesper Kløverpris (g CO2e/MJ) (g CO2e/MJ) of Novozymes A/S and Searchinger et al. (2008) Steffen Mueller from the Developing world 78 24 University of Illinois at Developed world 26 6 Chicago call for the use of Total 104 30 Hertel et al. (2010) a new method to calculate Developing world 3 1 land use change CO2 emisDeveloped world 24 10 sions. The new method is Total 27 11 referred to as baseline accounting. tion approach, which requires arbitrary proAccording to the researchers, indirect jections of future biofuel production. The land use change (ILUC) models that aim to researchers note that the land use emissions forecast the global warming impact of bioestimated using this method fail to incorpofuel production generally incorporate time rate actual land use dynamics. accounting in a simplistic way to allocate total The approach developed by Kløverpris carbon emitted from affected land to the voland Mueller provides ILUC researchers with ume of fuel that is produced. Kløverpris and the ability to isolate the climate impact of Mueller, alternatively, argue that the accuracy biofuel-related land use changes from other of accounting for time in this type of model land use changes. is severely limited by the use of the annualiza-

distilled

Scientists call for sustainable approach to bioenergy

Fallow Set aside

Productivity

An interdisciplinary team of 11 scientists from seven European countries and the U.S. recently published a paper reviewing food versus fuel and indirect land use change discussions in the international community. In the study, the authors say they are applying a critical view of the idea of cultivating feedstocks on surplus lands only, because environmental and socio-economic constraints that might restrict the availability and potential of surplus land are often not considered. They also note that there is a lack of a clear definition for surplus land, and uncertainties exist with regard to land availability assessments and bioenergy crop yields. The paper reviews discussions of classes of land considered to be surplus, nature conservation, indirect land use, water footprint, greenhouse gas emissions and loss of soil

Edeniq develops cellulosic demonstration

Abandoned

Marginal

Reclaimed Degraded Waste Need for land restoration *Chart sourced from “Bioenergy from ‘surplus’ land: environmental and socio-economic implications.”

carbon, as well as socio-economic factors. According to the authors, “if the constraints and their implications are assessed properly and accounted for, options for sustainable bioenergy production can be identified and developed.”

Edeniq Inc. has begun engineering and construction on a bagasse-to-sugars demonstrationscale facility in Brazil. The project is being completed in partnership with Usina Vale, a Brazilian sugar and ethanol producer. The new facility will be located with Usina Vale’s operations in the state of São Paulo. The demonstration plant will produce cellulosic sugars from bagasse feedstock. The extracted sugars will be converted into ethanol to demonstrate how sugarcane mills can increase ethanol production economically with Edeniq’s cellulosic technology. Once complete, the demonstration facility will be capable of talking in 20 tons of bagasse per day. The companies successfully completed a feasibility study to evaluate the economics of integrating Edeniq’s technology at the ethanol plant. Following the study, a collaboration agreement was signed, which applies to the joint funding of the demonstration facility. Edeniq also owns and operates a 2 ton per day pilot plant in Visalia, Calif.

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Exports Exchange calls DDGS a major success Tool helps determine the cost of feedstock More than 200 attendees from DDGS Price Table: Nov. 16, 2012 ($/MT) (Quantity, availability, payment and delivery terms vary) 30 countries attended the 2012 cultivation Delivery Point (Quality min. 35% Pro-fat combined) Dec. Jan. Feb. Export Exchange in Minneapolis. Barge CIF New Orleans

325

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Geoff Cooper, vice president of FOB Vessel Gulf 333 333 333 research and analysis at the RenewRail delivered PNW 339 341 342 able Fuels Association, was one of Rail delivered California 331 334 334 Mid-Bridge Laredo, Texas 317 321 321 several speakers to address distill40 ft. containers to South Korea (Busan) 351 351 357 ers grains at the event. For some, 40 ft. containers to Taiwan (Kaohsiung) 349 348 354 it’s all too easy to lose sight of the 40 ft. containers to Philippines (Manila) 365 366 372 significant contributions made by 40 ft. containers to Indonesia (Jakarta) 362 362 368 ethanol’s corn coproducts used as 40 ft. containers to Malaysia (Port Kelang) 362 362 368 40 ft. containers to Vietnam (HCMC) 363 363 370 feed ingredients, Cooper said. 40 ft. containers to Japan (Yokohama) 356 356 366 “The American ethanol indus40 ft. containers to Thailand (LCMB) 360 361 367 try produced nearly 39 million tons 40 ft. containers to Shanghai, China 348 349 354 of nutrient-dense animal feed in the KC & Elwood, Ill., railyard (delivered ramp) 290 397 299 2011-’12 marketing year, meaning *Data sourced from U.S. Grains Council the ethanol industry has surpassed the U.S. soybean crushing industry Ron Gray, secretary and treasurer of the U.S. in terms of feed production,” Cooper said. Due to Grains Council called distillers grains a “major sucthis year’s drought, corn production decreased. Less cess story,” noting that 25 percent of U.S. producdistillers grains will also be produced. tion has been exported in recent years.

A customizable calculator developed by University of Illinois agricultural economist Madhu Khanna is designed to help farmers accurately estimate the costs and benefits associated with switching from the cultivation of traditional crops to the cultivation of biomass energy crops. After selecting a baseline crop, the users provide specific information about expenses, yields and inputs to generate specific results. “It’s an information dissemination tool,” Khanna said. “The calculator allows farmers to put in their own parameters. They can customize the costs based on what their current farming operation looks like, what their current returns are on the land that they are thinking about converting, and learn what it would cost to grown an energy crop on it instead. They can decide at what price it might be feasible for them to produce an energy crop. What is the minimum price they would need in order to make it worthwhile?”

QUALITY CONTROL

30 | Ethanol Producer Magazine | JANUARY 2013

QUALITY CONTROL

Measurable

Success An in-house ethanol plant laboratory staffed with qualified, well-trained personnel is an indispensable edge in tough times. By Holly Jessen

From a square-footage point of view, a typical ethanol plant laboratory barely registers in the overall scheme of things. It’s a

Quest for Data Lindsay Kuhn, lab manager at Homeland Energy Solutions LLC, works in the 140 MMgy ethanol plant’s laboratory. PHOTO: JOHN C. THOMAS, FISHEYE

clear case of looks being deceiving, however, because its impact on the bottom line is anything but trivial. Kevin Howes, plant manager of Homeland Energy Solutions LLC, views the in-house laboratory at the Lawler, Iowa, ethanol plant as a crucial piece in the company’s success. “We view the lab as the third leg of the operational stool, the other two being maintenance and production,” he says. “All three are a necessity to have a functional operation. … If one is missing or broken you will fall.” Improving ethanol plant yield begins with data gathered in the lab, putting the lab manager and lab technician, who work full time at Homeland, in the front lines of protecting profitability. “At today’s corn prices, if you could improve your ethanol yield by 0.01 gallon of ethanol per bushel of corn ground, a 100 MMgy ethanol plant could positively impact their bottom line by $1 million,” he says. “Everything JANUARY 2013 | Ethanol Producer Magazine | 31

QUALITY CONTROL

it is a really knife edge where a plant makes it or breaks it, it’s even worse,� she says. Howes agrees, adding that, “In today’s environment of very tight crush margins, there is no room for error.� Susan Scherlinger, the lab coordinator at Show Me Ethanol LLC, a 55 MMgy plant in Carrolton, Mo., also talked about the lab’s role in holding the line on input costs and yield. Additionally, the lab provides checks and balances to ensure the company doesn’t send out off-spec product to its customers, she says. Having a quality control program in place is essential, says Wayne Sharon Kipp, lab technician, takes a sample at Homeland Energy Solutions LLC. Mattsfield, manager of analytical and microbiorecommends the use of data quality objectives, logical services for the Ethanol Performance Group, part of Phibro- a process in use by industries and government Chem. He spoke about the topic in October at organizations. It helps labs determine what’s the fifth annual Fuel Ethanol Laboratory Con- needed in data quality and the number of data ference, put on by Midland Scientific Inc. He samples, based on internal measurements of

PHOTO: JOHN C. THOMAS, FISHEYE

from a simple slurry pH measurement, to fermentation [high-performance liquid chromatography] HPLC readings, through moisture measurement in the final denatured ethanol can impact this number.� The way to get there is through data integrity or placing the utmost importance on quality control. “The lab must generate timely, accurate information in order for the right decisions to be made to maximize the plants profitability,� Howes says. Making sure lab instruments are calibrated correctly to give proper readings can have a big impact but is often overlooked, he added. Data integrity is crucial at a research facility like NCERC but it’s no less important at production plants, says Sabrina Trupia, assistant director of biological research at the National Corn-to-Ethanol Research Center. She makes the argument that the ethanol plant lab’s ability to positively influence profitability is linked to whether it is staffed with qualified and well-trained employees. That’s going to be the company’s first line of defense in keeping yield at optimal levels, Trupia says. For example, a lab that utilizes the right tests and recognizes a stuck fermentor early on won’t have to add additional antibiotics, yeast or enzymes, which can be costly. Not catching it on time could result in lower quality distillers grains as well as a loss of efficiency. “In this day and age, where

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tÄž žĂŏĞ Ä?Ĺ?ŽƚĞÄ?ĹšŜŽůŽĹ?LJ Ç Ĺ˝ĆŒĹŹ &Ĺ˝ĆŒ ĆŒÄžÄ‚ĹŻ Ć?ŽůƾĆšĹ?ŽŜĆ?Í• Ĺ?Ĺ˝ ƚŽ Ä‚ Ć‰ĆŒĹ˝Ç€ÄžĹś Ć?ƾƉƉůĹ?ÄžĆŒ ŽĨ ĞƚŚĂŜŽů ƚĞÄ?ĹšŜŽůŽĹ?LJ sĹ˝Ĺ?ĞůÄ?ĆľĆ?Ä?Ĺš h^ Í• /ĹśÄ?͘ Íť Ç Ç Ç Í˜Ç€Ä?ĆľĆ?Ă͘Ä?Žž Íť ͞ϳϭϯͿ ϰϲϭͲϳϯϳϰ 32 | Ethanol Producer Magazine | JANUARY 2013

QUALITY CONTROL

precision and accuracy. In some cases, the data might not need to be so precise, while other situations require careful accuracy. “If you don’t have a [quality control] program, there’s really no way to determine that—how good the data happens to be—and therefore, you may not be able to monitor processes well,” he said.

Beefing It Up

Ethanol producers searching for ways to improve their lab operations have a variety of options. NCERC, which is located 20 miles from downtown St. Louis, offers training for ethanol plant lab employees. Wherever training is completed, it is best accomplished in three stages, Trupia says. Initially, it’s about exposure to lab procedures, followed by active demonstration and, finally, hands-on training. She has identified three intersecting components for successful lab staff: performance, understanding and communication. Performance refers to their ability to put out reliable analysis and data with fewer samples needing to be re-run and less time spent on each test, Trupia says. “If they are qualified, they know how to do it, they know how to do it well, they make fewer mistakes and they know that the data is reliable,” she says. Understanding the process is another significant factor in ethanol plant lab success. To illustrate this, Trupia recounts working with interns at NCERC. Yes, they might be able to complete tasks in the laboratory after someone else sets everything up for them. But without understanding how the instrument works, what the data is used for and even the ethanol production process, they are at a disadvantage. “They can’t just push buttons,” she said, adding without understanding the process, a lab worker is unable to recognize or troubleshoot any problems that develop. Finally, lab staff must be able to communicate what’s discovered in the lab to operations. That means passing on the appropriate information, including more than just data values, she said. A past NCERC intern completed a master’s thesis on improving communication between the lab and the ethanol plant and concluded that in order to respond quickly to changes in plant conditions, communication must be constant.

Scherlinger agrees that training is very important. She has been working at Show Me Ethanol since the plant started up in 2008, and was promoted from within because she had previous lab experience. The company is very good about sending her to conferences and training sessions and makes it clear that lab is a vital part of its daily operations. “They come to you with a lot of questions,” she says. Iowa-based Efficient Green Energy also aims to help the ethanol industry improve lab operations. The startup company was launched in June, at the 2012 International Fuel Ethanol Workshop & Expo, on the premise that lab data is vital to improving yield. “We've seen a lot of variation in industry practice and firmly believe the companies who focus on the insight lab data provides are the ones who continue to succeed in our current operating environment,” says Brian Steenhard, president of the company.

The company sees a gap in the ethanol industry’s ability to harness lab data to make operational decisions. A crucial factor is the lab’s ability to capture accurate data. In fact, one of the first things done, when beginning work with a new ethanol plant, is to go through the facility’s records as far back as they exist, scrubbing it for errors. This helps identify meaningful relationships. “Without accurate data, it’s hard to make good, sound operational decisions,” he says, “so our first step in the process is just to make sure that the data is cleaned up and as accurate as possible.” Efficient Green Energy also provides training for lab staff. All lab staff, whether they are new employees or seasoned lab workers, can benefit from additional training, Steenhard says, adding that there’s a varied amount of expertise at work in ethanol plant labs. That can range from employing lab managers or technicians to simply utilizing operational staff, or

JANUARY 2013 | Ethanol Producer Magazine | 33

QUALITY CONTROL

‘We've seen a lot of variation in industry practice and firmly believe the companies who focus on the insight lab data provides are the ones who continue to succeed in our current operating environment.’ — Brian Steenhard, president of Efficient Green Energy

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some combination of all three. The company’s training program focuses on helping employees understand the theory behind various lab tests and the path to optimal yield improvement, not just how to complete the tests. On the data management side, Efficient Green Energy can offer ethanol production plants Ferm Up, its trademarked web-based data collection software. The company has also started a benchmarking program, specifically for ethanol plant labs. The ethanol industry is still evolving and it’s valuable to have the opportunity to talk to others in the industry about things such as chemical trials and recipe variations. “The industry needs those types of relationships, so that we can continue to promote ethanol as a viable alternative to gasoline,� he says. Mattsfield recommends that companies take advantage of training opportunities through local technical colleges or universities as well as attending relevant conferences and seminars. Like other companies, Phibro offers training at the plant or in the company’s St. Paul, Minn., location. He emphasizes the positives of participating in proficiency sample programs, which can help an ethanol plant lab identify areas for improvement. One example is a round robin, in which a sample is split up among several different participants. Each lab analyzes the sample and the data is pooled for statistical examination, which reveals to each participant how close they came to the statistical mean. Phibro recently started a HPLC round robin among ethanol producers. “It’s just another way for laboratories to check to see how they fare against another laboratory statistically,� he says. Overall, he’s impressed with the ethanol plant lab staff he has met. “They are always eager to expand their knowledge and improve their processes,� he says. The bottom line is that every lab should have an ongoing aim for advancement. “There is a place for improvement in any laboratory, whether it be a wellestablished laboratory in industry or governmental laboratory,� he said.

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34 | Ethanol Producer Magazine | JANUARY 2013

Author: Holly Jessen Features Editor, Ethanol Producer Magazine 701-738-4946 hjessen@bbiinternational.com

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Q&A

Keeping Corn Plus in the Sweet Spot Courtney Trask talks about the vital role her vendors play in maximizing plant yield and how she and her team manage a dizzying amount of daily operational data. INTERVIEW BY TIM PORTZ

Calculating the current ethanol yield at Corn Plus LLLP is Courtney Trask’s first duty when she reports to work at the 49 MMgy facility in Winnebago, Minn., each morning. As lab manager, Trask monitors pH and glucose levels, temperature and yeast health plantwide, all with an eye toward achieving maximum ethanol production. In her perpetual quest to optimize Corn Plus for ethanol, DDGS and corn-oil production while keeping bacterial infection at bay, the South Dakota State University graduate enlists the help of vendors, co-workers and peers she has met at industry events.

help decrease that overwhelming feeling. I attended several industry events right away and had the opportunity to create relationships with other lab managers in the industry. These relationships have also helped me become more familiar with the field and have allowed me to make more informed decisions.

When and where did your interest in science begin?

The ethanol process is monitored using a combination of high performance liquid chromatography (HPLC), pH, Brix, temperature, and yeast counts. Our fermentation process is also monitored every six hours, which means that each of the variables is different for each time during fermentation. Our vendors have been extremely helpful in sorting out which information is the most important to keep an eye on as well as what the numbers should look like at each hour. They have also been able to quickly analyze our data when our plant is struggling. Our HPLC rep has also been a huge help with assisting me in understanding our HPLC software to ensure we are getting accurate numbers. I also use my vendors when our plant is experiencing something that I haven’t seen before; their knowledge is vast because they work with so many plants.

What were your first days as a lab manager like? The learning curve was definitely steep. There is a lot to learn, and it can sometimes be overwhelming. I relied—and still do—heavily on my fellow employees, as well as vendors, to

36 | Ethanol Producer Magazine | JANUARY 2013

PHOTO: ELITE PORTRAIT DESIGN

Growing up on a cattle ranch in Western South Dakota gave me exposure to science at a young age. When we would treat our cattle or calves I was always a little curious about how the treatment actually worked. I knew as soon as I entered high school that I wanted to attend college to earn my doctorate degree in pharmacy. As my college career began, my plans didn’t quite work out so I decided to go with the next science-based degree that I had a strong interest in, which led me to receive my (bachelor of science) in microbiology. I had no idea that my interest in microbiology would lead me to the places that it has in my career.

Talk a little about the counsel your vendors provide and how you utilize it as you go about your day.

Q&A

In the sea of numbers you are constantly measuring and analyzing, what is the one number you look at first each morning? Ethanol is what we were built to do, so that is definitely the number that I look at first. If these numbers are lower than I like to see, I begin looking at the multiple variables that can cause a fermenter to not finish with the desired amount of ethanol. The first variable that I turn to is glucose. This number is important in judging how well the fermenter performed because yeast utilizes the glucose to produce ethanol. This means that if the glucose number is high, the yeast could have utilized more of the glucose to produce more ethanol. When this is the case, then I start looking into the multiple factors that could cause yeast stress. It is indeed a very data-driven process, and it’s an important part of my job to use the available data to make decisions about the performance of the plant.

How much variance do you experience in the data you measure each day? Do your yields fluctuate quite a bit? Our yield does fluctuate more than I would like to see. There are just so many variables that are involved, that it can sometimes be difficult to determine where the problem may be coming from. It isn’t uncommon to make several changes before you find the root cause of the problem. I do believe that as the plant becomes even more data-driven and as I become more comfortable with analyzing the data that the plant will begin to run more smoothly, and it will be easier to narrow down the source of the problem.

Do you see patterns emerging in the variations you see in the lab? Are there certain points in the process that end up on a short list of usual suspects? Patterns do tend to show up in the lab data. We like to say in this industry that “trends are your friends.” They often help to determine the source of the problem. There are definitely things that end up on a short list of usual suspects. These things are often verified by the trends that we see in the data.

What can you tell me about the samples pulled from the plant each day? We have nine fermenters here at Corn Plus. Currently seven of those fermenters are online, and being tested every six hours. This means there are roughly 15 to 20 fermentation samples per shift, which means there can be close to 40 fermentation samples every 24 hours. This is only our fermentation samples. There are also multiple samples that the lab as well as the operators take every few hours or at least once daily to ensure that the plant is running smoothly.

Can you explain what happens in a bacterial infection at an ethanol plant? Bacterial infections are most often caused by some type of dead leg in the process which is an area that cannot be properly cleaned. The corn mash can sit in this area, which just so happens to be the perfect pH, temp, and food source for bacteria growth to flourish. This can also be caused by improper cleaning, weak clean-

ing solution, or a multitude of other variables. From a microbiologist standpoint, I learned this piece of advice from a vendor just recently. If you have a pocket or dead leg of bacteria with a total cell count of 108, it only takes 1 gallon of that high bacterial contaminated mash into 1,000 gallons of clean mash to turn the clean mash into a 105 environment. In this industry, anything 105 or higher is considered an infection, so 1 gallon of infected mash can create a high risk environment early in fermentation.

It seems there is a sweet spot you are working to achieve and maintain from a production standpoint. Is this difficult to hold, or are you simply making minor adjustments to hold that position once it’s established? There is definitely a sweet spot that we would like to run and I feel that we will get to a point where we can make only minor adjustments to keep within the sweet spot parameters. Our situation is difficult right now because we have implemented so many new things at the plant in the past few months. I strongly believe that the more and more comfortable we get with the new equipment the easier it will be to maintain the sweet spot for good production. I also understand that stuff happens and there will more than likely always be a threat for a situation to occur. The best we can do is become knowledgeable about the decisions that we make, and above all make decisions based on data.

JANUARY 2013 | Ethanol Producer Magazine | 37

FERMENTATION

Polluted Sample A florescence microscope illuminates a sample of round yeast cells contaminated with rod-shaped bacteria. SOURCE: JOSEPH KALKWART, LALLEMAND

38 | Ethanol Producer Magazine | JANUARY 2013

FERMENTATION

Ferm

Assurance Keeping bacteria in check for quality fermentations requires close attention to hygiene. By SuSanne Retka Schill

An old-time plant manager once said he could tell there was trouble brewing by the smell when he arrived at the plant in the morning. A sudden contamination event causing that distinctly sour

smell is often a relatively straightforward problem to solve. “In a transient contamination, you might see something suddenly happen from one fermentation to the next, something suddenly dropped or changed and it’s raising alarm bells in the process control system,” explains Graeme Walker, scientific director of the Ethanol Institute and professor of zymology at the University of Abertay in Scotland. “That might point to some contaminated material coming in, or something that an operator has done by mistake, perhaps leaving some cleaning solution in the fermentor.”

JANUARY 2013 | Ethanol Producer Magazine | 39

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FERMENTATION

The bigger challenge to the quality control team at an ethanol plant is spotting a chronic contamination well before it becomes an issue. The root problem can be ingrained in the process, Walker suggests, most likely residual contaminants that have been there quite a while, resistant to normal cleaning routines. “That’s the chronic situation that can be more difficult to identify and do something about,� he explains. “A chronic contamination gradually builds, showing up in small incremental changes in the process. The chronic contaminations would be a buildup of biofilms of contaminant bacteria in pipework, for example. These are difficult to remove because they are in the nooks and crannies where automatic cleaning systems won’t remove them.� Biofilms are ubiquitous in industrial plants, he adds. “Most living micro-organisms in nature exist in biofilms attached to surfaces. Certainly in the human body, bacteria stick to tissues in the body in the form of biofilms,� he says. “And, keeping the medical analogy going, bacterial biofilms are notoriously difficult to treat with antibiotics and anti-infective drugs in a hospital environment. It’s a similar scenario in an industrial environment. If you

get a buildup of biofilms, you may occasionally kill just the upper surface of the biofilm cells but the ones that are deep-seated can be more resistant to antimicrobial agents.� Bacteria are a problem for ethanol producers because every molecule of acetic or lactic acid produced by a bacterium means there’s one less molecule of ethanol produced by yeast. Bacteria grow very quickly in the right environment, doubling every 15 minutes to an hour, Walker says. Thus, theoretically, a single cell can multiply to more than a million (1 x 106) cells in five hours and to 2.8 x 1014 cells in 12 hours. The single most important tool in an ethanol plant’s arsenal to limit that exponential growth is a microscope. “Even fairly rudimentary microbiological monitoring is helpful,� Walker says. “By that I mean you don’t have to have a PhD in microbiology working in your plant, but with relatively simple training you could get people to provide useful information.� Gram stains, slide cultures and direct microscopy can be used to detect bacteria in samples and, by using certain dyes, can provide additional information on viability, morphology and identity of bacterial contaminants. There are also a number

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40 | Ethanol Producer Magazine | JANUARY 2013

Looking Good An example of clean yeast is shown with a fluorescence microscope, equipment that offers ethanol plant laboratories some advantages. A single sample can be run in minutes and an entire ethanol plant’s worth of samples can be run in “just a couple of hours,� according to Joseph Kalkwart, technical sales representative with Lallemand Biofuels and Distilled Spirits. When special dyes are used, dead or living bacteria can be distinguished. SOURCE: JOSEPH KALKWART, LALLEMAND

PHOTO: CHRIS RICHARDS

FERMENTATION

Hidden Places Removing lines no longer in use reduces potential for contamination.

Contaminating Dead Legs

Ethanol plant quality control teams need to periodically inspect for dead legs and other places where bacteria can escape cleaning solutions. A rule of thumb is that the length of any pipe extension used for sampling or a tank connection should be limited to the diameter of the main pipe where the cleaning solution flows through, says Chris Richards of Lallemand Biofuels and Distilled Spirits, who conducts ethanol plant hygiene audits, among other duties. The turbulence during cleaning will effectively clean the connected pipe only that far.

of rapid tests, such as bioluminescence methods where swabs can be used to take samples from tank walls and quickly show contamination using the accompanying luminometer. Cleanliness is crucial to avoid contaminated fermentations, Walker stresses. “That means you’ve removed the vast majority of unwanted organisms.” But with ethanol plants providing the ideal environment for micro-organisms—ethanol-producing yeast being the good and bacteria the bad—monitoring the levels of residual bacteria becomes the goal. “Things to look out for include the consistency of alcohol production and yields from week-to-week and month-to-month,” he says. “If things are beginning to show a downward trend that might point the finger at the levels of hygienic cleanliness in the plant, and the fermentation vessel particularly.”

Spotting Incremental Change

In addition to watching for downward

trends, ethanol producers need to know their baseline numbers, stresses Chris Richards, global sales manager for Lallemand Biofuels and Distilled Spirits. He’s part of the Lallemand team troubleshooting fermentation issues and doing hygiene audits at ethanol plants. “You have to know what your plant normally does when it is running well,” he says, “so you can tell the difference when it is not.” There can be quite a variation from plant to plant in those baseline numbers. A plant’s quality control team can monitor ethanol yield trends as one baseline indicator. If yields begin to drift lower, it’s time to look for issues in plant systems that can include issues with grind, with enzyme dosing or distillation inefficiencies. For fermentation quality assurance, increasing organic acid levels are a prime indicator of increasing bacterial contamination. While the contamination may first be spotted in the fermentor—where any bacteria in the mash have many hours to multiply—the JANUARY 2013 | Ethanol Producer Magazine | 41

PHOTO: Chris Richards, Lallemand

FERMENTATION

Lurking Problems A blanked line on a fermentation outlet is an example of a dead leg where contaminants can hide.

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source may be elusive. “You can have a contamination from a fill line or heat exchanger that only shows in the fermentor because the mash only remains in the heat exchanger for a few seconds or minutes,� Richards explains. Multiple samples need to be gathered from as many places as possible and analyzed, using one of several methods, such as titrations, high-performance liquid chromatography (HPLC) or fluorescence microscopes. The samples need to be re-analyzed after several hours to determine if bacteria are growing. An increase in the organic acids, or other indicators being tested, indicates a possible source of contamination. Sometimes the sources of chronic contaminations are structural. Many plants were engineered for mechanics and cost effectiveness and not necessarily optimized for hygiene, Richards points out. Furthermore, when changes to a plant are proposed, the economic and process impacts are well studied, while the hygienic implications can sometimes be overlooked. He recommends that a plant’s quality control team systematically select areas of the plant to review in detail, looking at each line connection and valve. “Look at the product running through the branch or line and assess the risk to the process by looking at the type of product, frequency of cleaning and normal temperatures,� he says. Look for and eliminate dead legs—lines that are no longer in use, or perhaps used only occasionally—and make sure that there is no potential for bacterial contamination to move into the process. An ongoing project for every plant should be to optimize the pipework, he adds. Key things to look for include verifying internal weld surfaces are polished, making sure valves aren’t positioned too far from the T and finding any pipe runs with low points that are not drained. Each tank and all heat exchangers need scrutiny as well, using the same sort of logic as applied to pipework, Richards advises. While plants can’t change design easily, a good set of standard operating procedures can be designed to optimize hygiene. “Find key performance indicators that can be used to monitor effectiveness,� he says. Clean in place (CIP) procedures need to be reviewed to make sure the fluids are at the proper temperatures, the correct cleaners are used, the

FERMENTATION

cleaning head is matched to the CIP cycle time and that the head is rotating properly. It can be easy to install a new cleaning head and not remember to make the appropriate adjustments, he adds. A rotating head with off timing can result in a significant portion of a tank not being properly cleaned. Decisions to slow throughput could be problematic as well. A simplified example would be to slow the flow in the plant by 50 percent. “What are the implications of this from a hygienic point of view?” he asks. If the turbulence in the pipes and heat exchanges is reduced, particles are less likely to stay in suspension, he suggests, and deposits are more likely to form. Cleaning protocols may need to be adjusted to insure those deposits are flushed out.

contaminant microbes, the industry's only recourse might become cleaning and sanitation of all vessels and ancillary equipment prior to addition of almost sterile mash and the adding of culture yeasts with very few contaminating microbes,” Ingledew says. “This cleaning and sanitation technology is already used in the dairy and brewing industries, but is more expensive and would reduce profits significantly.” Dairies and breweries use things like caustic cleaning solutions, descalants, sodium

hypochlorite, iodophors and hydrogen peroxide to sanitize. “It will take such measures to eliminate the use of antibiotics, yet remove inherent contamination at decent cost,” he adds. “Serious microbial audits in the plant will become commonplace.” Author: Susanne Retka Schill Contributions Editor, Ethanol Producer Magazine 701-738-4922 sretkaschill@bbiinternational.com

What’s an Acceptable Loss?

So, if bacteria are ubiquitous and plant design sometimes works against thorough hygiene, how clean is clean enough? “We have to be realistic, alcohol plants are not pharmaceutical, they are not going to be sterile,” Walker says. “It’s a case of keeping an eye on the process and monitoring potential contaminating microorganisms. It’s going to be impossible to completely, 100 percent, remove them. As long as plant managers are able to live with what might be there, and it is not deleteriously affecting the yields and the process to a huge extent, that’s probably going to be okay.” Mike Ingledew, professor emeritus at the University of Saskatchewan who preceded Walker as the scientific director of The Alcohol School, suggests that even low, 1 to 4 percent losses in well-operated plants adds up to serious money. Running his calculations a year ago, with 209 plants in the U.S. producing 14.76 billion gallons, Ingledew figured a 1 to 4 percent loss amounted to between 147 MMgy to 588 MMgy for the industry as a whole. With ethanol at $2.20 per gallon, that would add up to an average loss per plant ranging between $1.5 million to $6.2 million per year, all at low infection levels. The move towards decreased antibiotic use has increased the chance for infections, Ingledew adds. “In my view, unless someone finds new antimicrobials that act at low concentrations to kill or prevent growth of

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JANUARY 2013 | Ethanol Producer Magazine | 43

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