WASHINGTON, August 5, 2015 – Construction is beginning on a Minnesota ethanol plant to repurpose it for the chemical n-butanol, often used in paint and coatings. Investors say the relatively small plant will be more profitable as a renewable chemical facility, and will serve as a model for future projects.
Green Biologics, a renewable chemicals company based in Gahanna, Ohio, acquired the assets of the Central MN Ethanol Cooperative LLC (CMEC) in late 2014. The facility, which will be renamed Central MN Renewables, will continue using corn feedstock after the 21 million-gallon per year ethanol plant is repurposed for n-butanol and acetone.
Timothy Staub, Green Biologics’ global vice president of business development, said during an interview with Agri-Pulse at the Biotechnology Industry Organization’s World Congress in Montreal last month, that the conversion “doesn’t make a difference for the farmer,” because the input material for the plant is the same.
CMEC purchases 7.5 million bushels of corn annually and Staub doesn’t expect that to significantly change, as both ethanol and n-butanol can be produced through fermentation of corn.
He said small ethanol plants, or those producing fewer than 50 million gallons per year, “are in trouble” due to larger and more efficient competitors, and need to find new purposes.
About a quarter of the more than 200 ethanol plants in the United States produce fewer than 50 million gallons per year, according to the U.S. Energy Information Administration. Minnesota has 25 ethanol plants, three of which produce more than 100 million gallons per year.
In CMEC’s case, employees are retained with the plant repurposing, as well as much of the equipment. “One of the biggest assets of this plant, and there are many, are the employees,” Staub said. The plant will continue to produce ethanol during its transition to renewable chemical production, which is expected to be complete in mid-2016.
Much of the equipment will be repurposed, including the fermenters, where Clostridia bacteria will replace the use of yeast. The company’s Clostridium fermentation platform converts a range of feedstocks into n-butanol and acetone. Through chemical synthesis, derivatives of the chemicals are used in a myriad of global consumer and industrial products, including paints, inks, moisturizers and fragrances. Staub said a majority of the plant’s production will wind up in paints and coatings, adding that more than 80 percent of the butanol molecule goes toward those products.
While n-butanol is similar to ethanol, its value as a chemical is more than three times the value of fuels, according to Central MN Ethanol. It has an immediate market valued at over $6 billion and downstream chemical intermediate markets valued at well over $40 billion. Global annual demand for n-butanol is more than 8 billion pounds with 4.4 percent yearly growth.
Joel Stone, Green Biologics’ president for North America and global vice president of engineering, said the “government policy in Minnesota has been extremely supportive,” as it is the first and only state to pass renewable chemical and bioproduct incentive program, administered by the Minnesota Department of Agriculture.
The program is structured to offer an annual payment to eligible facilities for a maximum of ten years. It goes into effect on July 1, facilities have until June 30, 2025 to come online, and the program sunsets June 30, 2035. The law is effective because it is “rewarding companies for location,” instead of enticing them with loans or grants, Stone noted.
In the meantime, Staub and his colleagues will seek buyers for the renewable chemicals soon to be produced at CMEC. “The challenge with this plant is it’s essentially a big bucket with ‘x’ amount of capacity and we have to manage the mixture of what goes into the bucket to build profitability,” Staub said.
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