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Biofuel industry innovating in production, finding new uses

Biofuel-research-United-Soybean-Board photo

Demand for biofuels has gotten back to levels seen before the COVID-19 pandemic hit in 2020, but that doesn’t mean a full recovery has happened in the industry.

“Demand is pretty close to what it was,” said Monte Shaw, executive director of the Iowa Renewable Fuels Association. “The fourth quarter of 2021 was very good for the ethanol industry, but that comes after three, four, five years that we were hanging on by our fingernails.”

Higher fuel prices have helped margins in the ethanol industry, Shaw said, but margins will always come and go. To keep sustained demand, refineries are always looking for more ways to create more product and find more places to use it.

In February, Oklahoma State University researcher Hasan Atiyeh received a patent for a new method that could increase biofuel yields while decreasing carbon dioxide emissions. The new process adds bacteria into the fermentation process used during biofuel production. That bacteria captures carbon dioxide to limit the environmental impact of production and used that CO2 to create more biofuels.

“The U.S. produces over 15 billion gallons of biofuel per year and is expected to increase that to 22 billion gallons per year,” Atiyeh said. “This process creates more environmental benefits, while increasing yield and profitability for refineries.”

Atiyeh estimates yields could increase by more than 15% using this new fermentation process. He said research has shown that using 2,000 dry metric tons of biomass per day in this process may increase revenue for a biofuel refinery by $33 million per year.

“More than 50% of the carbon in sugars is lost to production of hydrogen and carbon dioxide during traditional fermentation methods,” Atiyeh said.

The team at Oklahoma State is working on commercializing the method, and it initially will be marketed to the corn and cellulosic ethanol industries. They also note the impact could reach over into the jet fuel industry if the method is adopted on a large scale.

“The increased conversion efficiency of renewable raw materials to biofuels makes the process viable,” Atiyeh said.

Shaw said there hasn’t been much change in what kinds of demand biofuel byproducts have had over the past several years, but the industry is continuing to invest in new ventures.

He said higher protein distillers grains are a focus of many plants across the Midwest region, trying to achieve something on par with soybean meal. As that process grows, so will the market, but there may be plenty of soy meal competition.

“That is opening up new markets for the plants investing in those types of technologies,” Shaw said. “It will be interesting to see with all the new crush facilities going in, to generate more soybean oil for renewable diesel, that is going to put an awful lot of soybean meal on the market. So I think we are going to enter into an era of more affordable protein as long as the renewable diesel boom is going.”

He said plants are also looking to generate more corn oil lately and while that’s not necessarily a new use, the demand is rising. He said margins for corn oil have been high, with sale prices sitting between $64 and $70 as of the end of July.

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