Integrated

Biorefineries
Thomas E. Gieskes
© Organic Fuels Holdings, Inc. - All rights reserved March 2008 1
 Organic Fuels

• Houston based producer of biofuels

• Operating 55 MM GPY biodiesel plant on Houston Ship Channel
since January 2006
• Projects in development for ethanol from biomass and sugarcane
• Biodiesel feedstock integration into palm, jatropha and algae
• For ethanol, focus is on integrated biorefineries

© Organic Fuels Holdings, Inc. - All rights reserved March 2008 2

 Renewable Fuels 101

Photosynthesis
• Approximate chemical reaction: n CO2 + n H2O + 7n photons + nutrients => CnH2nOnNxSy + n O2
• Solar Incidence is 4 to 7 kWh/m2, but only 47% is in the right frequency range for photosynthesis
• Other inefficiencies and plants’ internal energy usage make that less than 10% of available sunlight is actually
converted into usable biomass
• Green algae are the most efficient, converting 7 - 8% of total sunlight into usable biomass with a maximum
theoretical yield of 140 ton DM/acre/year of which 40% could be available as lipids (15,000 gallons/acre/year)
• By comparison, soy beans yield only 1.5 ton DM/acre/year containing only 20% oil (90 gallon/acre/year), while
sugarcane typically yields 15 ton DM/acre/year for 800 gallon/acre/year of ethanol

Converting CO2 into renewable fuels does not sequester much carbon, it just
slows down the continuing increase in atmospheric CO2 from burning fossil fuels
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 Importance of Efficiency

• Overall conversion efficiency of solar energy into

renewable fuels is overriding consideration
• Increases cost competitiveness with fossil fuels
• Reduces land use requirements and food versus fuels
arguments
• Ultimate replacement of all fossil fuels by renewables is only
feasible with large-scale, highly efficient operations
• Key consideration in efficiency and cost effectiveness
is integration of complimentary technologies and
processes
• Whole Hog approach
• Large scale allows effective use of by-product streams

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 Integrated Biorefineries
Process Selection
• Microscopic Green Algae are the most efficient converters of sunlight
to biomass
• Limiting factors in algae growth
• Sunlight (availability, penetration, day/night cycle, seasonality)
• Nutrients
• Environment (temperature, salinity, acidity)
• Carbon dioxide (low ambient air concentration, slow diffusion)
• Sunlight is a given, nutrients and environment can be easily adjusted
and managed: Carbon dioxide is in most cases the limiting factor
• Source of enhanced carbon dioxide supply can be fossil or
renewable
• Concept of Integrated Biorefinery as proposed here is an integration
of processes that combine the efficiency of algae cultivation with a
renewable source of carbon dioxide from a complementary
renewable fuels process

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 Integrated Biorefineries
Design Criteria
• Land & Water Use
• Ideal configuration is contiguous acreage with maximum
economical transport distance as radius
• Competition with food production is unavoidable, but can be
minimized by maximizing efficiencies
• Maximize CO2 conversion into usable fuels
• Combine fermentation and combustion with algae cultivation
• Increase effectiveness of algae cultivation up to the limit of
available sunlight
• Sustainability
• Systems requiring the availability of cheap labor in order to
be economically viable are not sustainable in the long-term
• Minimize undesirable extraneous inputs/outputs (i.e., fertilizer
in, waster water effluent out)

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 Example
Integrated Sugarcane Ethanol & Algae
190 MM GPY
15,000 acre Algal
Extraction Biodiesel
Solar Incidence Ponds Biomass
6 kWh/m2/d 4,800 t/d & Biodiesel 140 MM lbs/y
Glycerin
980,000 t/y
Carbon Dioxide Meal/Protein
1,000 t/d
200,000 acre
Sugar Ethanol 120 MM GPY
24,000 t/d Mill Juice
Green Cane Plant Fuel Ethanol

Leafy Trash Bagasse Filter Carbon Dioxide

Vinasse
4,000 t/d 5,600 t/d Cake 8,500 t/d

Storage & Biofuel Power 240 MW

Drying 5,800 t/d Generation Export power

Ash
Fertilizer
Plant

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 Sugarcane Ethanol & Algae - Capital

• Investment $MM
• Land 200,000 acres @ $500/acre 100
• Farm Equipment & Infrastructure 100
• Mill & Ethanol 220
• Power, fertilizer & utilities 80
Total Ethanol 500

• Ponds 15,000 acres @ $50,000/acre 750

• Water circulation and CO2 distribution 250
• Extraction Plant 60
• Biodiesel 190 MM GPY 100
• Offsites 40
Total Algae 1,200
Total Capital 1,700
• Petroleum Analogy
• Capital is equivalent to $35/bbl of “reserves” when taken over a 20 year “life of the
field”
• Capital includes equivalent of downstream as well as upstream
• Renewables have no exploration risk and field life is in principle unlimited
• Petroleum does not have same level of co-product benefits (meal/protein, power)

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 Sugarcane Ethanol & Algae - Margins

• Revenues $MM/y
• Biodiesel 190 MM GPY @ $3/gallon ($70/bbl WTI, $15/bbl refining, $1/gallon tax credit) 570
• Glycerin 140 MM lbs/y @ $0.10/lbs 14
• Meal/Protein 980,000 t/y @ $200/ton 196
• Ethanol 120 MM GPY @ $2/gallon ($70/bbl WTI, $15/bbl refining, no tax credit) 240
• Power 240 MW @ $80/MWh dispatched 8,200 h/y 160
Total Revenues 1,180

• Costs $MM/y
• Sugarcane production 8.2 MM ton @ $25/ton 200
• Ops & Maintenance cost Mill, Ethanol & Power 120
• Ops & Maintenance cost Algae & Biodiesel 180
• S, G & A 30
Total Costs 530

EBITDA 650
• Petroleum Analogy
• Overall gross margin $265/bbl versus petroleum $60 to 90/bbl upstream and $10 to
15/bbl downstream
• Even without excise tax credits for biodiesel, EBITDA of $460 MM will result in viable
project and gross margins of $184/bbl, better than petroleum

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 Other Integrated Biorefinery Options

• Sugarcane and biothermal ethanol with algae

• Sugarcane to ethanol through conventional fermentation
• Gasification of co-produced biomass (bagasse and leafy trash)
• Conversion of synthesis gas into additional ethanol through anaerobic
digestion
• Carbon dioxide from fermentation and tail gas from anaerobic
digestion to algae cultivation
• Application in environments with low power prices
• Cellulosic Ethanol & Algae
• Enzymatic hydrolysis of lignocellulosic biomass followed by
fermentation
• Remaining lignite combusted for heat and power
• CO2 from fermentation and combustion used for algae cultivation
• Algae with fermentation of meal & protein
• Extraction of oil in aqueous environment
• Meal and protein fermented to ethanol
• CO2 from fermentation recycled to algae culture
• Suitable for arid environments
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 Current Status

• Integration of biomass fermentation and algae cultivation is subject

of a patent held by Cargill (WO/2006/127512)
• NREL Aquatic Species program and other early studies also
explored integration options as a means for enhanced carbon
dioxide environments
• UT Auburn and several other institutions actively exploring process
options
• Problems are in the realm of cost effective engineering solutions
rather than fundamental science
• Capital intensity of large scale operations will make the first project
difficult to finance
• Likely path to commercialization through small to intermediate
scale algae projects piggybacking onto large scale proven
sugarcane technology

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 Conclusions

• Large Scale Integrated Biorefineries

• Are economically viable and can compete in a $70+/bbl crude
oil environment without tax credits or subsidies
• Can be designed to combine complimentary processes to yield
ethanol and biodiesel
• Can be designed to utilize carbon dioxide from renewable fuel
processes to cultivate algae up to the maximum limit of
available sunlight
• Can be designed to produce a product slate of ethanol and
biodiesel to fit the demand profile in the major fuel markets
• Can be commercialized using the strength of known
technologies such as sugarcane ethanol to support emerging
algae technologies

© Organic Fuels Holdings, Inc. - All rights reserved March 2008 12