Have cellulosic biofuels arrived?

Nov 302012
 

“Our bugs are the best in the business,” Dean Kegler of ZeaChem declares proudly.

I’m touring one of the country’s first experiments in cellulosic biofuel production, a demonstration-scale refinery in the small industrial port town of Boardman, Oregon. The bugs in question are high-powered naturally occurring bacteria whose sole mission in life is to ferment sugar into acetic acid — on the way to becoming fuel-grade ethanol. The bugs’ sources of sugar: woody biomass from locally farmed poplar trees and wheat straw from area farms. The facility is expected to start production utilizing wood chips by the end of 2012. The fuel’s ultimate destination: passenger vehicles. I glance around the facility with curiosity, wonder, and a bit of skepticism. Am I looking at the future?

ZeaChem will use wood chips to create biofuel. Photo courtesy of ZeaChem.

Biofuels stand as one of the most promising, though controversial, alternatives to fossil fuels such as petroleum, coal and natural gas. The question of dependence on fossil fuels sits at the crossroads of environment, land use, and national security concerns. Everybody knows that the United States’s consumption of ever-greater quantities of fossil fuels for energy – in other words, our addiction to oil – is a major factor in global climate change. But our need for ever-growing volumes of imported fuels from politically unstable or totalitarian countries is also destabilizing: our purchases at the pump prop up unfriendly regimes with disastrous human rights records.

However, the potential for increased food-based ethanol production presents two important environmental and social challenges. First, the use of valuable agricultural land for fuel crops leads to the potential for increased food prices. Second, the land use conversions that arise from increased food-based ethanol production leaves open the possibility of increased international total greenhouse gas emissions, despite the lower emissions coming from vehicles’ tailpipes.

Cellulosic biofuels appear to be a different beast than those based on corn. Raw material for the fuel comes mostly from wood chips and agricultural waste, rather than from food sources. And the International Energy Agency (IEA) estimates that the fuel generates 70% to 90% emissions reductions compared to gasoline. However, the technology for refining wood and farm waste into energy has proven difficult to develop.

To make cellulosic ethanol, the cell walls in plants must first be untangled, and sugars must be extracted from the cellulose through a multi-stage fermentation process. Here’s where ZeaChem’s world-class bugs come in: the little guys are enlisted to ferment the sugars into acetic acid, an intermediate chemical, which can be converted into ethyl acetate and then into ethanol in the final step of the process.

Despite ample government grants, mandates, and loan guarantees, ZeaChem and its counterparts elsewhere in the country have yet to produce commercial scale fuel-grade cellulosic ethanol. But the company remains optimistic. “We will produce ethanol by the end of 2012,” Kegler told me on our tour earlier this fall. Standing in the midst of the factory’s elaborate array of production equipment, surrounded by the buzz of construction and the enthusiastic operating staff, it was difficult not to believe him. (Full disclosure: Ecotrust is a minority investor in ZeaChem.)

ZeaChem’s biorefinery in Boardman, Oregon. Courtesy of ZeaChem.

Still,there are some bigger questions that ZeaChem and the cellulosic ethanol sector have to answer on their march to independence from fossil fuel.

The first is stability of inputs. Will the feedstock supply be disrupted due to climate change, natural disasters such as droughts and hurricanes, or even economic fluctuations such as recessions?

Second, the question of scale arises: due to economies of scale in the refining process, the future of biofuels seems to lie in large-scale, relatively centralized production and distribution. Will the large-scale nature of the production process leave dreams of a widely distributed, autonomous energy system in the dust? In any case, what’s clear from the evidence – and my own experience at ZeaChem – is that the rapidly developing field of biofuel technology is worthy of any social change advocate’s rapt attention.

 

Carrie Atiyeh, ZeaChem’s Director of Public Affairs, responds:

On question #1: ZeaChem’s feedstock strategy focuses on risk mitigation, which reduces the dangers raised in the first question. ZeaChem’s refining process can use multiple types of feedstock, allowing the company to source biomass sustainably and locally, within a 25-50 mile radius of the refineries. This feature of the refining process keeps transportation costs low and thus makes production costs competitive. It also reduces the company’s exposure to price fluctuations: if the price of one feedstock spikes, we can switch to an alternative feedstock. Dedicated energy crops, such as poplar trees, will supply the majority of ZeaChem’s feedstock, with locally available agricultural waste acting as a supplement. ZeaChem has secured a long-term, fixed-price contract for its feedstock with GreenWood Resources, owner and operator of a local poplar tree farm. The contract will provide ZeaChem with feedstock through the demonstration scale and 1st commercial biorefineries in Boardman. ZeaChem’s long-term contract with GreenWood Resources will reduce the potential for disruptive price fluctuations to impact ZeaChem’s operations.

On question #2: Biorefineries will be located where there is market demand for the biofuel. A benefit of ZeaChem’s location for its demonstration and 1st commercial biorefinery in Boardman is that there are multiple transportation options for cellulosic ethanol to be transported to market. The sites at the Port of Morrow are located on the Columbia River and an existing ethanol barge load-out dock is already in place. Barge transportation is a very efficient and economical way to transport goods to market. From Boardman, ZeaChem’s cellulosic ethanol can go to refineries up and down the west coast to be blended into the gasoline pool. The sites are also located inside of a Union Pacific rail loop and Interstate I-84 passes just to the south.

Cooling the planet, clearing the air

Sep 212012
 

Expanding climate change mitigation approaches beyond greenhouse gases to also target related pollutants would have enormous public health benefits in the nation’s most disadvantaged communities, according to a report released today by E3 Network and the Joint Center for Political and Economic Studies.

Targeting power plants that produce high levels of pollutants would benefit both the climate and poor and minority communities.

The report, Cooling the Planet, Clearing the Air: Climate Policy, Carbon Pricing, and Co-Benefits, found that the same industrial facilities that emit carbon tend to generate other harmful pollutants, such as particulate matter and nitrogen oxides, that actually pose a more immediate and direct threat to the health of nearby residents.  Since these facilities are typically located in or near low-income and minority communities, adding these harmful “co-pollutants” to a climate change mitigation strategy would have an almost immediate positive health impact on the health of millions of poor and minority Americans.

The research showed that the benefits would be comparable in economic value to the benefits of the carbon reduction by itself.

The peer-reviewed report is the first national level study to take such a careful look at the potential to further reduce harmful air pollution as part of any strategy to lower greenhouse gas emissions and reverse climate change.

“Current climate proposals are missing out on an opportunity to achieve considerable health and equity gains through a common-sense approach that addresses co-pollutants such as soot and nitrogen oxides. And since the burden of these co-pollutants falls disproportionately on the poor and people of color, this is one of those opportunities for equity and efficiency to come together,” said report co-author, Manuel Pastor. “Cooling the planet and clearing the air can and should go hand in hand.”

With recommendations that strategically target specific industries, such as petroleum refineries and chemical manufacturing, as well as a small number of facilities that yield the highest emissions of air toxins, the report offers a fresh look at how carbon policies can be designed to be more equitable and efficient going forward.  “Climate change is real. So sooner or later, it will be back on the nation’s policy agenda,” said study co-author James Boyce. “The next time around, we think much more attention should be paid to the tremendous public health and air quality benefits we stand to gain by moving our economy away from fossil fuels.”

Kristen Sheeran, Director of the E3 Network, which commissioned the report commented, “This report highlights often overlooked issues of environmental justice. Take for example the recent explosion on August 6 at the Chevron Refinery in Richmond, California. This refinery is the single largest emitter of greenhouse gas emissions in the state of California, and over 85% of the residents who live within a three-mile radius of the plant live below the federal poverty line. We recognize an enormous risk—as well as an enormous opportunity—for public health and to address pollution where it is needed most.”

Read E3 Network’s executive summary or full report

Why the Columbia Biogas facility is a good idea

Mar 082012
 

Every day, all across the city, Portland’s famed restaurants and breweries throw money and energy literally down the drain. Waste from these establishments, a mix of fat, sugars and other byproducts, is pumped into the city’s sewer system or sent to landfills. In the case of larger breweries and beverage manufacturers, fees for waste disposal can cost tens of thousands of dollars per month.

A planned waste-to-energy facility by Columbia Biogas would turn this lost opportunity on its head. The plant, slated for Northeast Portland, would collect solid and liquid food waste from restaurants, grocery stores, processors and other commercial outfits around the city, unleash bacteria on the nutrient rich stew and create methane gas, fertilizer and purified water out the back end. The gas would produce enough electricity for 5,000 homes.

Putting food waste to work
(image courtesy of Columbia Biogas)

The project, which is seeking city credit support to build the facility, has unfairly been drawn into the controversy over prior questionable spending of sewer and water fees. The irony is that Columbia Biogas’ project actually benefits water and sewer users in the city.

Ecotrust has been closely involved in this project since 2010 as an advisor helping the company to access New Markets Tax Credit financing. (Full disclosure: a portion of our fees depends on the successful completion of full financing of the project.) We chose to support this project because it meets our criteria for the type of businesses that Portland and the Pacific Northwest needs. It creates long-term economic value, provides high-quality jobs and training, and produces renewable energy and other valuable products.

In the process, Columbia Biogas will reduce emissions associated with hauling waste to the landfill, reduce methane emissions in the landfill, and improve water quality in the region.

Biogas plants are built on proven technology; they’re not risky bets. More than 6,800 operate in Germany alone, supplying 3% of the country’s electricity and there over 100 here in the United States, in addition to the hundreds of municipal waste water treatment facilities that include anaerobic digestion as secondary treatment step.

After some 85 contractors work over a year to build the $55 million plant in Northeast Portland, 20 technicians and plant operators will take up jobs at the facility. Columbia Biogas has committed to training workers from Northeast Portland’s Cully Neighborhood, currently saddled with unemployment well above the national rate, to fill those jobs, and to providing assistance to help other low-income and disadvantaged people in the city secure and maintain jobs at the plant.  The company has forged such strong relationships with the neighborhood that the neighborhood association has actively encouraged the City of Portland to find a solution to the plants’ financing challenges.

In a changing energy landscape constrained by dwindling resources, with the climate morphing due to fossil fuel use, with the economy desperately in search of new ideas, we need to re-imagine energy creation and use. Thankfully, forward-thinking entrepreneurs and energy developers are working on innovative solutions. This project is everything we aspire for in a Portland business venture:  innovative, smart, deeply committed to the public good, and — best of all — the more successful the company is, the greater the environmental and social benefits for all of us.

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