One Kernel, Two Fuels: GS CleanTech Closes Another Corn Oil Extraction Technology Deal
18 September 2006
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| The Corn Oil Extraction System installed in an ethanol plant. |
GS CleanTech Corporation has executed a definitive agreement with an Illinois-based ethanol producer to extract about 12 million gallons per year of crude corn oil from the producer’s distillers dried grains for conversion into a biodiesel feedstock using GS CleanTech’s proprietary corn oil extraction technology.
Traditional ethanol processing converts each bushel of corn, which weighs about 54 pounds, into about 18 pounds of ethanol, 18 pounds of carbon dioxide, and 18 pounds of distillers dried grains (DDG), which contain about 2 pounds of fat. This corresponds to a corn to clean fuel conversion efficiency of about 33%, or about 2.8 gallons of clean fuel per bushel of corn. GS CleanTech is trying to increase this efficiency.
The corn oil extraction and biodiesel processing technologies convert the fat in the DDG into a high grade corn oil that can then be converted into biodiesel on close to a 1:1 volumetric basis. This increases the corn to clean fuel conversion efficiency to 36%, or about 3.0 gallons of clean fuel per bushel of corn.
GS CleanTech provides turn-key extraction systems for no up-front cost in return for long-term agreements to purchase the extracted corn oil based on a fixed discount to prevailing fuel prices. Under the terms of the new agreement, GS CleanTech will install its Corn Oil Extraction System on-site at two ethanol production facilities where GS CleanTech will generate between $14.0 million and $18.0 million in annualized revenues from the purchase and sale of the facilities’ extracted corn oil as a biodiesel feedstock.
The Corn Oil Extraction Systems extract about 3 million gallons of crude corn oil from a typical 50 million gallon ethanol production facility and enable the ethanol producer to increase their revenues by about 3.5%, or by as much as $4.7 million in new annualized sales.
To date, GS CleanTech has executed definitive agreements to extract about 22.5 million gallons of crude corn oil from a number of ethanol facilities. Once the systems are commissioned at each facility, GS CleanTech will purchase and sell the extracted oil as a biodiesel feedstock.
GS CleanTech will sell all of its extracted corn oil to GS AgriFuels Corporation, GS CleanTech’s sister company, for conversion into biodiesel.
I suspect that if ethanol didn't get a tax credit the corn would be used for something else or another crop would be planted. For example with oilseed rather than corn the whole process could be turned around by getting biodiesel first then fermenting the leftovers. This shows how selective taxes distort things.
Posted by: Aussie | 18 September 2006 at 02:14 PM
While it is promising for green technology to receive high funding for its development by companies like GS CleanTech, great strides are still required to come to an affordable, efficient, and completely clean alternative to fossil fuels. You mentioned that GS CleanTech is taking efforts to make ethanol production more efficient; however, I feel the scope of ethanol’s shortcomings is not completely addressed. The Energy Justice Network published statistics on ethanol production which maintain that corn ethanol actually requires twenty-nine percent more fossil fuel energy to manufacture than the clean energy it yields. The study also mentions the 52,000 tons of insecticides and 735,000 tons of herbicides used in profuse corn farming in addition to the topsoil degradation it causes. Another problem is the pollution ethanol refineries release. According to the network, the EPA concluded that “most, if not all” ethanol plants discharge much more pollutants than permitted. It is arguable that these drawbacks are of lesser consequence than those of fossil fuels, but it should be noted that methods of weaning ourselves off fossil fuel have a way to go.
Posted by: sweetpea | 18 September 2006 at 02:36 PM
"Energy Justice Network"
Not sure how reliable of a source that is....looks pretty biased to me. Most recent studies of ethanol that I've seen disprove much of what the Pimentel and Patzek claim. In fact, a more in-depth study from Patzek's own university disagreed with his results.
http://www.sciencemag.org/cgi/content/short/311/5760/506
Posted by: Angelo | 18 September 2006 at 03:36 PM
I'm surprised at the small size of the system. If ethanol plants are of a similar small size then making lots of them and putting them in many places should be possible. And by dispersing their operation and, hopefully, their ownership, the danger from natural disaster or manmade disruption is reduced.
While there may be studies that show problems with ethanol as a fuel, it starts the process of breaking the dependence on fossil fuels. I am confident that the entrepreneurial process will quickly improve the yield and reduce side effects of these systems or they will be replaced with something better.
Posted by: Ed | 18 September 2006 at 10:00 PM
entrepreneurial process fosters the most profitable enterprises not necessarily the best.
Posted by: Patrick | 18 September 2006 at 10:07 PM
An enterprise can make a profit only by giving its customers what they want. Thus, it is best for the customer according to his values.
Posted by: Freedom_First | 18 September 2006 at 11:52 PM
"I am confident that the entrepreneurial process will quickly improve the yield and reduce side effects of these systems or they will be replaced with something better."
Exactly. Whether that is adding cellulose (energy crops & waste) as inputs to the process, reducing the energy consumed during the conversion process, increasing the net energy of the outputs by using butanol, finding better uses of other by-products, or distributing more efficiently to consumers by using butanol, there are PLENTY of opportunities for improvements that bright business minds will take advantage of.
Posted by: Angelo | 19 September 2006 at 04:16 AM
The latest story on this site is a great example....
"The water input required by wet milling is reduced by 90%, according to Chen. Wastewater output is cut by 95%, and electricity use is reduced by 47%. The total operating cost of a Chen-Xu Method ethanol plant should be much less than that of a wet-milling plant, and total equipment investment is less than half. And with proper planning and management, total equipment investment should be less than that of a dry-milling plant."
Posted by: Angelo | 19 September 2006 at 04:39 AM
Thnx to all.
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