White Paper on Ethanol
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What is Fuel Ethanol?
This clear liquid with an agreeable odor is known by different names; ethyl alcohol, grain alcohol, or Etoh, but it all means the same thing, ethanol, which is made by fermenting and distilling simple sugars. Ethanol is a fuel produced from crops such as corn, grain sorghum, wheat, sugarcane, and other agricultural feedstocks. Most fuel ethanol produced in the U.S. is derived from corn-latest figures indicate that 10% of the U.S. corn crop is dedicated to ethanol production. In Brazil, the world's top producer of ethanol, sugar is the primary feedstock. Because ethanol is produced from crops or plants that harness the power of the sun, it is a renewable fuel.
There are three major types of fuel ethanol: The 200 proof alcohol produced in an ethanol production facility, must be denatured so humans cannot consume it. While it can be used in vehicles designed to burn pure ethanol, most ethanol is currently blended at a rate of 10% with gasoline for resale in petroleum markets.
A mixture of 85 percent ethanol and 15 percent gasoline, E85 is a leading alternative fuel used in the U.S. Over 3.5 million autos are capable or running on E85 fuel, and it can be purchased at approximately 200 refueling sites in the U.S. When E85 is not available, these "flexible" fuel vehicles can operate on any blend of ethanol, unleaded gasoline, or any combination thereof.
The most common form of ethanol, E10 contains 10 percent ethanol and 90 percent gasoline. In 2004 more than 3 billion gallons of fuel ethanol will be consumed in the U.S., the vast majority of which is blended at a 10% rate. All automobile manufacturers in the U.S. approve the use of E10. Approximately 30% of all gasoline consumed in the United States will be blended with ethanol in 2004. Because the ethanol molecule contains oxygen, it allows a vehicle's engine to more completely combust fuel, resulting in fewer emissions. Fuel ethanol blends are successfully used in all types of vehicles and engines that require gasoline. Approval of ethanol blends is found in the owner's manuals under references to refueling or gasoline.
Source: American Coalition for Ethanol and Natural Resources Canada
Benefits to Our Air and Environment
The use of ethanol-blended fuel helps reduce the environmental impacts of gasoline consumption on our society.
Ten percent ethanol blends reduce carbon monoxide better than any other reformulated gasoline blend - by as much as 25%. Ethanol-blended fuel shows a 35-46% reduction in greenhouse gas emissions and a 50-60% reduction in fossil energy use.
Ethanol contains 35% oxygen by weight, making it burn more cleanly and completely than gasoline. E85 has the highest oxygen content of any fuel available, making it burn even more cleanly and even more completely than any other fuel.
Ethanol is used in oxygenated and reformulated gasoline (RFG) as set out in the Clean Air Act Amendments of 1990. This standard requires an oxygenate, like ethanol, to be added to gasoline to help it burn more completely. Reformulated gasoline or oxygenated gasoline is required in areas that violate carbon monoxide and/or ozone quality standards
Ethanol-blended fuels reduce vehicular emissions of carbon dioxide, methane, and other gases that contribute to global warming. Argonne National Laboratory has determined that for every gallon of gasoline replaced by ethanol, greenhouse gases are reduced by 30 percent. This reduction is due, in part, to the "carbon cycle," whereby much of the carbon dioxide released when ethanol-blended fuels are used is reabsorbed by biomass plants, like corn, during growth. These biomass plants provide the feedstocks for ethanol production.
The Department of Energy's Argonne National Laboratory reports that in 2003, ethanol use in the United States reduced the CO2-equivalent greenhouse gas emissions by approximately 5.7 million tons, equal to removing the annual emissions of more than 853,000 cars from the road!
Ethanol is highly biodegradable, making it safer for the environment. A report issued by the California Environmental Protection Agency in 1999 concluded "considering the relative toxicity of ethanol, MTBE and their degradation products suggests that the direct effects of ethanol (if any public exposure were to occur) would be substantially less severe than the effects of MTBE." (source: Potential Health Risks of Ethanol in Gasoline, Office of Environmental Health Hazard Assessment, California Environmental Protection Agency, December 1999)
The CalEPA report also concludes: "Predictions of ethanol dispersion and biodegradation in the environment indicate that ethanol is unlikely to occur in drinking water at levels having any toxicological significance." i.e. ethanol does not contaminate drinking water.
Sources: Argonne National Laboratory, CA Environmental Protection Agency, American Coalition for Ethanol
Benefits to the Economy
Ethanol use will cut the U.S. trade deficit by $34.1 billion through 2012. Doubling ethanol use in the U.S., as called for in the Renewable Fuels Standard, will create nearly 50,000 permanent jobs, with indirect employment totaling over 200,000 new jobs.
Ethanol production and use increases the price and demand for corn.
The local price of corn increases by an average of 5-10 cents per bushel, adding significantly to farm income in the general area surrounding an ethanol plant.
USDA projected that the increased demand for corn to support the additional ethanol production to replace MTBE will increase cash receipts for farmers by $2.3 billion between 2000 and 2004. (AUS Consultants, March 20, 2000)
USDA estimates that the Renewable Fuels Standard would double the demand for corn for ethanol production to 2 billion bushels per year by 2012.
USDA estimates the Renewable Fuels Standard would generate an additional $2 billion to $4 billion in net farm income by 2012.
Currently, 35 of the nation's 85 ethanol plants are farmer-owned. Taken as a whole, farmer-owned ethanol cooperatives represent the single largest producer of ethanol in the country with 40% of the nation's ethanol production.
In the March 2004 study "The Contribution of the Ethanol Industry to the American Economy in 2004", by LECG LLC found that:
The combination of spending for annual operations and capital spending for new ethanol plants under construction will add more than $15.3 billion to gross output in the American economy in 2004.
New jobs are created as a consequence of increased economic activity caused by ethanol production. The increase in gross output (final demand) resulting from ongoing production and construction of new capacity supports the creation of more than 143,350 jobs in all sectors of the economy this year.
Increased economic activity and new jobs result in higher levels of income for American households. The production of ethanol will put an additional $3.9 billion into the pockets of American consumers this year.
The full impact of the annual operations of the ethanol industry and spending for new construction will add $1.25 billion of tax revenue for the Federal government and $806 million for State and Local governments during 2004.
Source: American Coalition for Ethanol, LECG LLC
How is Ethanol Made?
Ethanol can be made by a dry mill process or a wet mill process. All of the new fuel ethanol plants in the U.S. use the dry mill method. The major steps in this process are:
Milling. The feedstock (corn, wheat, barley, etc.) passes through a hammer mill which grinds it into course flour called meal. The vast majority of ethanol in the U.S. is produced from corn.
Liquefaction. The meal is mixed with water and alpha-amylase enzyme to create a "mash" which is passed through cookers where the starch is liquefied. Heat is applied at this stage to enable liquefaction. Cookers with a high temperature stage (120-150 degrees Celsius) and a lower temperature holding period (95 degrees Celsius) are used. High temperatures reduce bacteria levels in the mash.
Saccharification. The mash from the cookers is cooled and the secondary enzyme (gluco-amylase) is added to convert the liquefied starch to fermentable sugars (dextrose).
Fermentation. Yeast is added to the mash to ferment the sugars to ethanol and carbon dioxide. Using a continuous process, the fermenting mash is allowed to flow through several fermenters until is it fully fermented and leaves the final tank. In a batch process, the mash stays in one fermenter for about 48 hours before it flows to the distillation process.
Distillation. The fermented mash, now called beer, contains about 15% alcohol plus all the non-fermentable solids from the corn and yeast cells. The beer is pumped to the continuous flow, multi-column distillation system where, using heat, the alcohol is removed from the solids and the water. In the final distillation column, the alcohol leaves the top of the final column at about 96% ethanol. The residue mash from the distillation process, called stillage, is transferred from the base of the first column to the co-product processing area.
Dehydration. The alcohol from the top of the last column passes through a dehydration system where the remaining water is removed. Most ethanol plants use a molecular sieve to capture the last bit of water in the ethanol. The alcohol product at this stage is called anhydrous ethanol (pure, without water) and is approximately 200 proof.
Denaturing. Ethanol that will be used for fuel is denatured, or made unfit for human consumption, with a small amount (2-5%) of gasoline at the facility which produces the ethanol.
Co-Products. There are two main co-products created in the production of ethanol: distillers grains and carbon dioxide. Distillers grains in either wet or dry form, is a valuable animal feed. Carbon dioxide is given off during fermentation and many ethanol plants collect, compress, and sell it for use in carbonated beverages, food processing and other industries.
Source: BBI International HYPERLINK "http://www.bbiethanol.com" http://www.bbiethanol.com and American Coalition for Ethanol
Air Emissions
Ethanol plants being built today with a distillers grain dryer also incorporate a Thermal Oxidizer (TO) to meet environmental regulations as well as to eliminate odors that sometimes created community opposition to ethanol plants. In the past, the largest source of emissions from an ethanol plant came from the distillers grain dryer. Today, use of a TO eliminates the dryer emissions and associated odors. Ethanol plants that do not dry the distillers grain do not have dryer emissions and do not require a TO.
Ethanol plant TO's and boilers use Ultra-Low NOx burners that reduce nitrous oxides emissions, eliminate 92%+ of particulate matter and 95%+ of the volatile organic compounds. They also virtually eliminate odors from the distillers grain dryers.
Thermal oxidizers have been around for a number of years and are used in the food and chemical industries to eliminate odors such as burnt coffee smells from large roasters and chemical vapors.
Wastewater Discharge
In order to reduce organic compounds in wastewater streams from ethanol plants, some technology providers have incorporated the use of anaerobic digesters. Wastewater streams are directed to an anaerobic (without oxygen) reactor that degrades the organic compounds. This process produces methane gas which can be used as an alternative energy source for the boiler or dryer.
This process allows full recycling of the process water, greatly reducing the amount of wastewater discharged. Plants now only discharge non-contact cooling water and water from the makeup water softener or reverse osmosis system. The balance of the water loss in the plant is through cooling tower evaporation and the water in the distillers grains.
Several major advantages come with this technology. First, anaerobic digester systems remove 85 to 95% of the organic compounds. The removal of these compounds improves yeast performance in the fermenter. Another advantage is that new plants can eliminate the traditional waste treatment process, which can often save $500,000 to $1,000,000 in capital equipment costs.
Finally, with processes adopting "zero process water discharge" operations, the need to connect to local wastewater treatment services is often not required, thus allowing for plants to be built in more rural locations nearer to the sources of raw materials.
Source: BBI International, http:www.bbiethanol.com
Ethanol's Past
In the year 1826, the first authentic internal combustion engine in America was developed by Samuel Morey. The engine, which ran on alcohol and turpentine, powered a small boat at eight miles per hour up the Connecticut River, but the invention never attracted investors. Another early developer of the internal combustion engine was German inventor Nicolaus August Otto, when in 1860, he used ethanol as a fuel in his four-stroke engine. Otto's fuel of choice was the widely available and untaxed alcohol used in spirit lamps throughout Europe.
Turn of the century Americans saw Henry Ford design his Model T as a flexible fuel vehicle able to run on ethanol, gasoline, or any combination of the two fuels. But as the country's ability to efficiently refine cheap and abundant crude oil into gasoline increased, ethanol use as a motor fuel waned.
In the 1960s, Brazil provided a major shift in the industry by adopting an energy policy mandating ethanol as a motor fuel. Brazil continues today as the leading producer of ethanol for automobiles, with over four billion gallons per year of ethanol production from sugarcane. The U.S. is close behind at three billion gallons.
Due to the Arab oil embargo of 1973, Congress began to see the need for a domestically produced renewable fuel like ethanol. In the early 1980s, President Jimmy Carter requested that Archer Daniels Midland (ADM) convert its new beverage alcohol plant into a fuel alcohol facility. The fuel alcohol plant was part of a wet milling plant producing fructose. ADM processed corn into ethanol for several years before other wet mills added alcohol finishing capacity to produce enough fuel ethanol volume to give the burgeoning industry some degree of validity in the eyes of the petroleum industry.
The emergence of the new generation cooperative and the farmer-owned ethanol plants of the mid-90s drastically increase the development of the ethanol industry. By the late 1990s, the LLC structure (which allows non-agricultural investors) became more common. The recent stabilization of the ethanol market coupled with the profit potential has rekindled interest in privately owned facilities. By the late 90s, plant production capacities moved into the 20 to 30 million-gallon range. As corn-to-ethanol conversions improved, plant sizes increased, further reducing operating costs and improving the overall bottom line profits. In addition, the increasing acceptance of distillers dried grains with solubles (DDGS) as a high-value animal feed supplement, helped boost revenue.
In part, this renewed interest has been spurred on by the development of new markets previously served by Methyl Tertiary Butyl Ether (MTBE), the only fuel oxygenate competitor that ethanol had. In 1997, the Environmental Protection Agency announced that significant levels of MTBE were detected in Lake Tahoe in California. Since that time, thousands of groundwater wells across the United States have been found to be polluted beyond use by MTBE. As of this writing, 18 states, including California and New York, have banned MTBE-laced gasoline. Many others have bills which are expected to be signed in the near future. Gasoline marketers have, in many states, voluntarily opted out of MTBE and switched to ethanol as the only practical fuel substitute.
Source: BBI International http://www.bbiethanol.com
The Present
Ethanol production in the U.S. has reached unprecedented levels. According to the Energy Information Administration, (the statistical branch of the U.S. Department of Energy), a record 2.81 billion gallons of ethanol was produced in 2003. 1980, the first year that ethanol production was tracked, there were fewer than ten ethanol facilities producing approximately 50 million gallons annually. Nowadays, many facilities are designed to produce over 50 million gallons of ethanol in annual production. More than 3.25 billion gallons of ethanol will be produced in the U.S. by the end of 2004. Why the huge increase? Consumer demand, the banning of methyl tertiary butyl ether (MTBE), and the number of production facilities set to begin operations.
There are currently 85 ethanol production facilities in the U.S., primarily centered throughout the Corn Belt, and nearly half of these plants are owned by farmers. While U.S. plants vary in capacity, most can produce between 20 million and 60 million gallons of ethanol per year. Many of these facilities are constructed with the engineering flexibility to double production in the event of an expansion. Cellulosic feedstocks such as municipal waste or recycled paper products, rice hulls, bagasse (fibrous residue from sugarcane), small diameter trees, wood chips, and switch grass may also be used to produce ethanol, but these products are not yet utilized on a commercial scale.
Source: BBI International http:www.bbiethanol.com
The Future
By 2005, the U.S. will have more than 80 ethanol plants on line. The ethanol industry has not taken its eye off its goal to add value to agriculture and economic viability to rural communities. Researchers in the industry continue to work on better raw materials and processes, investigate new feedstocks and envision new biorefinery concepts that incorporate multiple feedstocks and multiple products in one plant.
When Governor Davis announced in 1999 that California would phase out the use of MTBE in California's 14 billion gallon per year gasoline market, it ignited the explosive growth of the fuel ethanol industry that continues today. From 2001 to 2002 fuel ethanol production in the U.S. grew 21%, and in the following year production grew another 22%. In two years the industry grew from 1.9 billion gallons of production to 2.8 billion gallons. We expect annual production to grow another 14% in 2004 to more than 3.2 billion gallons. Past and projected future growth of the fuel ethanol industry is shown in the following graph.
There are several factors that will continue to drive the growth of the fuel ethanol industry for the next decade as shown in the above chart:
Phase out of MTBE
Ethanol price relative to crude oil (or gasoline)
Clean octane
Oxygenate for RFG program
Gasoline extender (refinery capacity)
Local economic development
Source: BBI International http://www.bbiethanol.com
Energy Independence
Renewable ethanol directly displaces the amount of crude oil we need to import, offering our country critically needed independence and security from foreign sources of energy.
Current U.S. ethanol production of 3 billion gallons per year can reduce gasoline imports by 35% and effectively extends gasoline supplies at a time when refining capacity is at its maximum. The 5 billion gallon ethanol production level contemplated in the "Renewable Fuels Standard" could reduce oil imports by nearly 350,000 barrels per day.
Ethanol is key to reducing our country's trade deficit in crude oil, a figure that has been steadily increasing.
U.S. Trade Deficit in Crude Oil
1987 $27 billion 1990 $43.7 billion 1999 $59.2 billion
2002 $100 billion 2003 $130 billion
Energy Independence Facts:
The U.S. imports about two-thirds of its oil, and some experts predict our dependence upon foreign crude could climb to 70% in the years to come
For every barrel of ethanol produced, 1.2 barrels of petroleum are displaced at the refinery.
Since 1980, U.S. ethanol production has replaced over 20 billion gallons of imported gasoline.
U.S. fuel consumption increased from 12 billion gallons per year in 1970, to 160 billion gallons in 2002.
The U.S. imports 37 million gallons of gasoline per day, an amount that has more than doubled in just the past three years.
Source: American Coalition for Ethanol
Just the FAQs
How much will the use of ethanol impact the price of corn?
There have been numerous studies done on this issue, and the consensus is that the price of corn will increase form 5 to 10 cents per bushel for every 100 million bushels of corn use. Price responses will vary according to crop projections, carry-over levels from previous years, and global supply and demand.
How does the use of ethanol reduce exhaust emissions?
Ethanol contains oxygen, so it contributes to a cleaner, more efficient burn of the gasoline with less CO and other toxic chemicals in the exhaust emissions. Ethanol is a simple chemical which, when burned, does not produce all the complex pollutants and aromatics formed by the many different chemicals contained in gasoline.
What is "oxygenated" fuel?
An oxygenated fuel is any fuel that contains oxygen and therefore does not need as much oxygen from the air to burn cleanly.
How much ethanol can we get from one bushel of corn?
A bushel of No. 2 yellow corn weighs 56 pounds. The industry average fuel ethanol yield is over 2.7 gallons per bushel. In addition, per bushel, the process can yield 17-18 pounds of high-protein livestock feed, and 16 pounds of carbon dioxide for beverage or refrigeration use.
Can ethanol only be made from corn?
No, ethanol can be made from products other than corn. Corn is the predominant feedstock in the U.S. today because of low prices and wide availability. Other grains, plus sugar beets, potato wastes and cheese whey are currently being used where available and competitively priced.
What is left of the corn kernel after the ethanol is removed?
In the dry mill process only the starch is removed for ethanol, so all the protein, vitamins, minerals, fiber, and some of the energy remains. This is a very nutritious food for cattle, poultry and swine.
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