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Wednesday, August 25, 2010

If A Cellulosic Ethanol Plant Were Built Nearby, What Would It Bid For Your Cornstalks?



 

Federal energy policy calls for it. Farmers are ready to haul corn stover and switchgrass into plants to make it. So when will cellulosic ethanol come about? Cellulosic ethanol apparently is not quite ready for prime time, since there may only be one commercially viable plant currently in operation, and researchers are feverishly working to perfect the process and make it economically successful.

Currently the US policy is for 16 billion gallons of cellulosic ethanol to be produced by 2022 to meet the federal biofuels mandate. It can come from dedicated energy crops, such as switchgrass, crop residues, such as corn stalks, or woody plant byproducts, such as wood chips from sawmills. While those feedstocks might be plentiful, an ethanol plant must be able to accept them. Currently, corn is about the only feedstock from which ethanol is made, but to increase the current level of production would be problematic, says Kansas State University economist David Lambert. His research agrees with others, who say that continuing to increase the production of corn based ethanol will have direct impacts on other corn users and will impact other crop supplies through land use changes. To achieve the national goal of 36 billion gallons of ethanol by 2022, would require 14 billion bushels of corn, which has yet to be achieved, and that leaves none for any other use.

In 2010, the total amount of advanced biofuels production, or cellulosic ethanol, is expected to be 10.1 million gallons, well short of the 2012 intermediate goal of 1 billion gallons. If the commercial capacity can be developed, Lambert says the cellulosic ethanol industry may be developed in several areas of the country. Corn ethanol plants are in the Midwest because corn is here. However, there may be cellulosic ethanol plants in the Northwest where there are woody feedstocks, as well as Midwestern plants where switchgrass, straw, or corn stover might be converted to ethanol. He says, “It is projected that approximately 60 to 90 gallons of ethanol can be produced from a ton of harvested crop residue. Thus, a 100 million gallon per year (MGY) ethanol plant would require delivery of between 1.1 and 1.7 million tons of feedstock per year. Assuming 17 ton truck capacities and year-round, 24 hour per day operation, truck deliveries would need to occur every 5-8 minutes.”

Lambert, a Kansas State economist, says a cellulosic ethanol plant in his state would require 2.2 million acres of wheat straw to make 100 million gallons of ethanol. Based on the 135 bushel corn yield in Kansas, it would take 747 thousand acres of corn stalks, and 2 million acres of sorghum to make those 100 million gallons of ethanol. However, he says the major cost may be the transportation to supply a plant from distant fields, and long term contracts would need to be arranged or plants may fail to have enough feedstock for its capacity. He cites a Minnesota study that estimated costs of recovering corn stalks and transporting them to range from $60 to $100 per ton, depending on the collection methods.

Lambert suggests that a cellulosic ethanol plant could be constructed that would produce 116.6 million gallons of ethanol annually for $1.22 per gallon. However for that to happen, the feedstock supply would have to be near perfect. It would require 1.8 million tons of crop residue, but the value of that feedstock falls the further away it is from the plant. Adjacent to the plant, farmers might be paid $26.64 per ton for corn stalks or switchgrass, since the feedstock did not have to be transported from more distant fields.

Summary:
Despite federal policies supporting cellulosic ethanol, very little is being produced, and the one billion gallon per year goal may not be achieved in 2012. High production costs are noted for the process of breaking down the biomass, and the biomass has to be harvested and hauled to the plant, which is a considerable cost for the producer, particularly if the plant is drawing from some distance away. Farmers will have to ensure that selling biomass is profitable.

Posted by Stu Ellis on 08/25 at 01:17 AM | Permalink

Comments

Stu; I agree 110% with your analogy of Cellulosic Ethanol West of US HY 81 their could never be built such a plant. The crop residue is just too valuable for the soil. The Food for Fuel misnomers that have been spread by the Oil and Food company's have become gospel to the naive and unknowing public. The cheap Food and fuel policy our country has known is now history. Anyone knowledgeable of the US farmer should know they can usually do the impossible. Hardly anyone believed we could competitively grow the corn to make the 13 MMgy of Corn Ethanol that is currently being manufactured. This Ethanol directly replaces Oil & $ to country's that hate and despise Americans and what we represent.

Posted by: Dick Sterrett at August 25, 2010 2:02PM

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