Ethanol Giant Poet Says It Has Slashed Cellulosic Ethanol Costs by More Than 50%
By John O'Dell November 20, 2009
There may be hope: Poet LLC, the world's largest producer of corn-based ethanol, says it has reduced the cost of making ethanol from corncobs instead of from the edible kernels to $2.35 a gallon and expects to get it to $2 by the time it opens a commercial plant in 2012.
The cost-cutting for cellulosic ethanol made from non-food waste material is critical in getting the stuff to market, and getting it to market is critical for meeting the federal renewable fuels standard and avoiding the many environmental and food-chain problems associated with corn and sugar-cane ethanols.
The new standard calls for the U.S. to be using 36 billion gallons of renewable fuels a year by 2020, much of it cellulosic ethanol - up from just 9 billion gallons a year now.
Poet CEO Jeff Broin (above), in an interview with the subscription-only E&E TV environmental news program, said his South Dakota-based company was logging a cost of $4.13 a gallon to make cellulosic ethanol just a few years ago.
At $2 a gallon, he said, cellulosic ethanol will be able to compete in the retail market with gasoline (although it still be will more expensive to produce than ethanol from food crops such as corn and sugar cane).
Broin didn't go there in his interview, but we expect his company is aiming at a cellulosic ethanol price that's a lot lower than $2 a gallon.
One of Poet's potential competitors, cellulosic start-up Coskata Inc., is targeting a $1 per gallon cost for its fuel, which it expects to begin producing in commercial quantities at the end of 2012.
Broin said that continued production efficiencies and cost-reducing breakthroughs in the production of the specialized enzymes needed to break down tough cellulose for fermentation into ethanol - or ethyl alcohol - have contributed to and will continue to positively impact the falling cost of cellulosic-ethanol production.
He also repeated the ethanol industry's call for Congress to open up the market by boosting the so-called ethanol blend wall - the permissible amount of ethanol, a corrosive liquid, that can be blended with gasoline without requiring modified pumps and vehicle fuel tanks - to 15 percent from the present maximum allowable blend of 10 percent ethanol and 90 percent gasoline.
In the following video prepared for Poet's in-house news service, Mark Stowers, senior vice president for science and technology, discusses some of Poet's most recent cost-cutting achievements:
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