• The Conference
  • Client Events
3 Questions with

What’s behind your interest in giving a presentation about biogas due diligence for project developers in the Biogas & Landfill gas track?
As an Independent Engineer, Luminate has performed due diligence in support of project finance for dozens of projects utilizing the other technologies represented at the conference, but the deal flow of biogas projects has historically been small by comparison. Recently, this has changed; we’ve seen increased interest from developers wishing to project finance their biogas projects, specifically anaerobic digestion of manure and substrate feedstocks. Unfortunately, many of these projects have struggled to get financed for one reason or another. I’m hoping to demystify the due diligence process and share some of my experiences to help biogas project developers get their projects across the finish line.

Why do you suspect that the biogas segment has struggled to obtain project financing as compared to other biomass technologies?
In North America, anaerobic digestion projects using the feedstocks I mentioned aren’t relatively prevalent. Additionally, most of the projects that exist were built by intelligent farmers using grants, ag financing, or on balance sheet; not third-party developers using project finance as a vehicle to obtain capital. As such, there’s limited experience for developers to draw from.

What is a practical first step for biogas developers hoping to avoid the unpleasant surprises sometimes uncovered during the due diligence process?
The way a project is structured to obtain limited recourse project financing varies significantly from a project financed by other means. To make sure you’re proceeding down the right path, involve your lender and the Independent Engineer early in the development process to learn about the nuances that differentiate bankable projects.

See Vyduna Speak On Tuesday, April 11 (1:30 pm - 3:00 pm)
De-Risking Biogas Projects to Put Investors at Ease and Get Vital Project Capital Flowing

3 Questions with

You are set to give a presentation at the International Biomass Conference & Expo April 10-12 in Minneapolis on a pathway to commercial biofuels and biochemicals from renewable crude. In your opinion, why might this model of producing renewable crude vs. manufacturing a finished advanced biofuel such as renewable diesel be better to pursue?
Converting raw lignocellulosic biomass to finished, market-ready fuels or chemicals usually requires a multistep process. Many of these multistep processes are based on an innovative front-end concept for converting biomass to a raw liquid or gaseous intermediate, which is then further converted to finished fuels or chemicals via backend processes based on commercially available separation, hydroprocessing and distillation technologies. Most of these backend processes are currently deployed in bought-and-paid-for petroleum refineries. By using innovative frontend technologies to convert biomass only as far as needed to yield renewable crudes acceptable as refinery feedstocks, technology developers are not required to devise and fund development of backend process integration methods; pursue funding, licensing and business arrangements for building plants encompassing complete multistep processes; or address finished product certification, regulatory, marketing and distribution requirements. Without these requirements, developers are free to concentrate their technical and economic resources on making their innovative biomass conversion technologies work.

Many times companies work to develop biofuel process approaches from womb-to-tomb, where they seek to unilaterally own and operate every step of a process from start to finish. Your approach to biofuels and biochemicals from biomass via the renewable crude pathway involves specialized partnerships and employs a unique division of labor. Can you explain this approach and why this could be beneficial?
Womb-to-tomb is great because it enables complete control—of intellectual property, production capacity and inventory, distribution, marketing, and profit—but it also requires complete responsibility for paying for everything and the necessary expertise to make everything happen. Some specialty refiners are interested today in renewable crudes that meet certain specifications, and it is likely that interest will increase in response to RIN program modifications that improve the economics of co-refining “bio-intermediates” to finished fuels.

The Energy & Environmental Research Center in Grand Forks, North Dakota, has engineered a unique gasifier to produce syngas from biomass, which will then be utilized in a Fischer-Tropsch process producing a form of renewable crude material for upgrading into fuels and chemicals. How does this gasifier work and what features make it unique?
The “Sandwich” gasifier is named for its design feature that results in an endothermic reduction zone sandwiched between high-temperature oxidation zones. This reaction zone configuration enables more precise temperature control in the reduction zone, thereby enabling more precise control of syngas composition and improved carbon conversion of even poorly reactive carbonaceous fuels.

See Aulich Speak On Tuesday, April 11 (1:30 pm - 3:00 pm)
Exploring the Evolving Science of Manufacturing Fuel and Chemical Intermediates

3 Questions with

For those who aren’t familiar, can you broadly explain what a wood chip standard is, and why it’s important?
Rural communities in forested regions of the U.S. spend billions of dollars on fossil heating fuels annually. At the same time, hundreds of millions of dollars are spent each year to thin public and private forests to improve health and reduce risk of wildfire. There is significant opportunity to expand the use of modern wood heating in the U.S. and develop a vital local market for low-grade and small-diameter wood sourced from forest stewardship activities. Despite the market growth potential, there remain issues regarding air emissions, boiler efficiency, boiler performance, and overall system reliability. These issues still hinder the expansion of the modern wood heating market. Wood fuel quality and consistency directly impacts how efficiently, reliably, and cleanly these systems burn.

With grant assistance from the USDA Forest Service, we have assembled a team of forestry, wood energy, fuel specification, and wood combustion experts who propose to establish and disseminate nationwide a long overdue fuel specification for woodchips used for thermal energy. The technical standard and companion guidance document will guide the production, transportation, storage, and use of woodchips in heating and combined heat and power applications. The standard will be established through a comprehensive outreach effort involving all impacted stakeholder interests. It will be promulgated through a stringent process overseen by the American Society of Agricultural and Biological Engineers. Adoption and utilization of the standard will be widely promoted throughout the United States. The adoption of such a standard is essential for the continued growth and mainstream adoption of wood heating for commercial and institutional applications.

This initiative has been in the making for quite some time. Aside from acquiring funding necessary to the effort, what’s been the most time-consuming or difficult part of the process?
The process of developing a standard consistent with internationally accepted procedures entails very thorough evaluation of input from the widest possible range of stakeholders. Our team is committed to ensuring that anyone who may have in interest in this standard, from whatever perspective, has the opportunity to comment on it and shape the final product. To be thorough takes time. However, we have the advantage of starting from an ISO standard that has already been developed, but needs to be adapted to the U.S. market.

You presented on this topic at least year’s International Biomass Conference & Expo. Can you tell us a little about progress made since then?
At last year’s IBCE we were introducing the project even before our funding was official and work had begun. This year, we will be presenting a draft standard and using the opportunity for interaction with hundreds of potential stakeholders at IBCE to gain valuable feedback on the draft. IBCE provides the most important national venue where such a wide range of interested parties will all be present. We look forward to everyone’s feedback.

See Niebling Speak On Tuesday, April 11 (1:30 pm - 3:00 pm)
Why On-Spec Feedstock is So Vital for Heat and Power Generation and the Efforts Underway to Ensure It Happens throughout the Industry

3 Questions with

Dane, your presentation is centered on bad decisions that have been made when choosing conveyor systems for wood pellet plants. What’s the most common problem that you see occur under these circumstances?
I think the greatest mistake is underestimating the importance of good conveyors. That mindset that all conveyors are equal allows people to buy on price, rather than value. Also, too often the material handling portion of the facility is thought of last in the plant design and as simply a connecting item. Conveying is not a stand-alone item, rather it is an integral part of the production system. The entire system must be designed together just as you would design all the parts of any machine – considering every parts interaction with the others.

What other kinds of issues can an inadequate conveying system cause?
Well, the first and most obvious one everyone thinks of is the downtime caused when inadequate units need repairs. An industrial pellet plant is a huge investment and having that entire asset hamstrung by one bad conveyor is just plain stupid. We have also seen people purposely sacrificing production volumes so they don’t overload their conveyors and break them. We’ve seen huge repair costs and additional parts inventory costs to support weak units. And then the biggest cost is replacing them with the proper units once they finally face the fact that they must do so.

Without giving out too much prior to your presentation at the International Biomass Conference & Expo, what’s the most important piece of advice that you have to give in regard to conveyor selection?
Allow the conveying to be designing in conjunction with the rest of the plant by people with “real world” wood handling experience. I’ve been doing this over 35 years, and we as a group have been perfecting our wood handling conveyors for over 15 years. Everyone tries to choose the best pellet mills and the best hammer mills. Why buy the cheapest conveyors to tie them together?

See Floyd Speak On Wednesday, April 12 (8:30 am - 10:00 am)
Innovative Operational Approaches Available to the Pellet Industry’s Early Adopters

3 Questions with

You have had a lengthy career in studying and managing combustible dust. Have regulations and methods of managing combustible dust at biomass facilities changed substantially over the past couple of decades?
The regulations have certainly evolved significantly in the past 30 years. The evolution of NFPA 68 (Deflagration Venting) from a guideline to a standard, with language that can now be referenced in fire codes, has had an impact. Major losses by facilities in the biomass industry has led to both greater awareness of explosion risk by facility designers and operators, as well as stricter enforcement regarding explosion prevention by OSHA and other agencies. Finally, the development and release of NFPA 652 (Fundamentals of Combustible Dust) is providing a template that biomass facilities can use to understand how to manage this everyday threat so that explosions do not occur under normal operating conditions, and that they can be mitigated, should an abnormal or upset condition occur.

Dust explosions can present major risks at a biomass facility. Where do explosions most commonly originate at a biomass plant?
Explosions can occur any place where there is sufficient combustible dust in suspension to exceed the minimum exposable concentration (MEC). All that is needed is an ignition source. Areas in biomass facilities subject to this risk include pellet coolers, particle size reduction equipment, air-material separators such as dust collectors and cyclones, mechanical conveying such as bucket elevators, and storage vessels like silos and hoppers.

In your presentation, you plan to talk about some proven ways to address the threat. Can you broadly touch on some of the methods you’ll discuss?
For process vessels, we will be discussing passive explosion protection, such as standard and flameless vents, as well as active explosion suppression for vessels where passive protection is not practical. Since secondary explosions due to explosion propagation is a major threat for a catastrophic multi-vessel explosion incident, we will also be covering both mechanical and chemical explosion isolation for decoupling the explosion.

See Grandaw Speak On Tuesday, April 11 (1:30 pm - 3:00 pm)
A Necessary Discipline: Best Practices in Dust Management and Fire Prevention

3 Questions with

The first D3MAX pilot plant to produce cellulosic ethanol from fiber and residual starch in distillers grains—the animal feed coproduct resulting from corn ethanol processing—is currently being installed at Ace Ethanol LLC in Stanley, Wisconsin. How does this technology work exactly, and what is unique about the process?
There are three key process steps in the D3MAX technology. The first is dilute acid pretreatment of the ethanol plant’s wet cake; wet cake is the high-solids stream from the ethanol plant decanters. Pretreatment of the wet cake begins the process of converting the cellulose and hemicellulose in the corn fiber to soluble sugars. The second step is enzymatic hydrolysis. In this step, enzymes complete the conversion of the cellulose and hemicellulose to sugars. The third step is the fermentation of the five- and six-carbon sugars that have been released in the two previous steps. In fermentation, a GMO yeast converts the sugars to ethanol.

One of the unique aspects of the patented D3MAX process is that we use wet cake for our feedstock. The corn fiber in wet cake has been “cooked” by the ethanol plant or “pre-pretreated” by the ethanol plant. The result is the cellulose and hemicellulose are easier to convert to fermentable sugars without creating fermentation inhibitors. The D3MAX pretreatment is done at low temperatures and pressures, reducing both equipment and energy costs, while avoiding fermentation inhibition. The simple fact that we use wet cake for our feedstock avoids many of the difficult technical issues faced by many other cellulosic ethanol companies.

The quality of the pretreatment impacts the downstream enzymatic hydrolysis and fermentation steps. If the pretreatment is done improperly, yields will suffer and there may be operational problems like plugging and fouling. Because D3MAX pretreats wet cake at low temperatures, negative impacts on downstream unit operations are avoided.

The high solids in wet cake also results in lower capital and operating costs for the D3MAX process. The D3MAX process is also a true “bolt-on” technology, which means very minor modifications to an ethanol plant are needed to use the D3MAX process.

What’s the typical range of how much residual starch vs. fiber is found in distillers grains, and would the ethanol produced from the residual starch via the D3MAX process qualify for D3 cellulosic RINs, or would only the volumes of fuel produced from the fiber qualify?
The D3MAX process is approved under RFS pathway K—the pathway for the production of ethanol from crop residues. Users of the D3MAX process will have to submit and receive EPA approval of a Quality Assurance Plan before cellulosic ethanol can be produced and D3 RINs generated.

Residual starch in wet cake runs about 2 to 3 percent of the wet cake solids. The D3MAX process converts the residual starch to ethanol, and that ethanol will qualify for D3 RINs. In July 2014, the U.S. EPA ruled that corn fiber is a crop residue and fuel derived from crop residues qualify as a cellulosic biofuel. Cellulosic biofuels generate D3 RINs.

In the same ruling, the EPA found that de minimis amounts of starch adhering to the corn fiber and converted to a biofuel would be considered a cellulosic biofuel. The de minimis determination only applies to starch adhering to corn kernel fiber that is being processed into ethanol separately from corn starch ethanol (as in the D3MAX process). Processes that convert corn starch and corn kernel fiber to ethanol in situ may not consider any portion of the corn starch to be de minimis. Details can be found in the July 18, 2014, Federal Register Vol. 79.

How much additional revenue could a 100 MMgy corn ethanol plant utilizing D3MAX technology add to its bottom line, and what’s the expected return on investment (ROI)?
The D3MAX process will increase an ethanol plant’s ethanol production by 8 to 10 percent. Corn oil recovery will also increase about 0.5 pound per bushel. The third revenue stream is the income from D3 RINs. Our projections show a 100 MMgy ethanol plant’s revenue increasing by $32 million per year with the D3MAX process. The volume of distillers grains will be reduced by about 20 percent and we assume the lower volume will be offset by the increased value of the high protein feed produced by the D3MAX process. Protein in the distillers grains will increase to almost 40 percent.

The ROI in the second year of operation of the D3MAX plant is 142 percent. This is with 60 percent debt financing and a 40 percent equity investment. Engineering and construction costs for the D3MAX process are estimated to be $30 million or $3.67 per gallon of installed capacity.

See Yancey Speak On Tuesday, April 11 (3:30 pm - 5:00 pm)
The Corn Platform: Launching Second Generation Bio-Product Innovation from a First Generation Giant

View Full Agenda   View Program Tracks   Register Now

Platinum Level Sponsors

Gold Level Sponsors

Supporting Organizations

Media Partner

Produced By