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Biofuel booster has a point

TheStar.com - Mar 24, 2008

http://www.thestar.com/columnists/article/349953

Corn ethanol isn't sustainable. Corn ethanol is jacking up food prices. Corn ethanol isn't worth the energy that goes into producing it.

Okay, we get it already. Corn ethanol isn't a long-term path for making renewable fuels, but does that mean ethanol itself is a bad thing?

"I think there's a lot of disinformation out there," says Frank Dottori, founder and former CEO of Tembec Inc., the multibillion-dollar forest products company.

Dottori, a chemical engineer by training who describes himself as the "old retired guy," apparently has some unfinished work to do. Earlier this month he was announced as the new head of Greenfield Ethanol Inc.'s "cellulosic ethanol" division - that is, he's in charge of finding out how to make the renewable fuel out of wood chips, agricultural residues and municipal solid waste. Pretty much anything but a food crop like corn.

"I've been at this for 30-some years, looking at different ways of converting biomass into valuable chemicals and energy and fuels," says Dottori, explaining that after he retired in 2006 he was approached by Toronto-based Greenfield - the largest independent ethanol producer in Canada - about taking on the challenge.

"They wanted to move away from corn. They want to get into this cellulosic ethanol as the next step ... That's where the world has to go."

Right now, much of the ethanol world - at least in North America - is stuck on corn. Nobody would argue it's the perfect crop, and most would say it can't be relied on as the ethanol market grows. But Dottori also believes the current problems making headlines are being exaggerated.

"Corn is being blamed for the price of tortillas in Mexico, or driving up the price of food generally. But if you look at the price of oil, it's gone from $20 to $100, and everybody uses oil to do farming," he says. "I think that's a bigger part of the problem than ethanol."

He points to the fact that wheat prices hit a record high of $13.50 a bushel on Feb. 27. In the past year, wheat prices have jumped 180 per cent, much higher than the 31-per-cent hike seen with corn. We've seen a tripling of wheat prices in the past couple of years, and it's getting to the point where bakers are getting hammered with the high cost of flour sacks.

"Virtually no wheat goes into making fuel," says Dottori. "So I think there are people who rain on anything, and I don't think they've got their facts."

At the same time, most in the industry see the writing on the wall and view corn as merely a transition to a more sustainable approach. It's why Suncor Energy is working with Vancouver-based Lignol Energy Corp. to build a cellulosic ethanol pilot plant in Colorado. It's why Royal Dutch Shell has invested in Ottawa-based Iogen Corp., which is building an ethanol refinery in Saskatchewan and another in Idaho.

Both Lignol and Iogen use enzymes to break down the cellulose in biomass and access sugars that are converted into ethanol.

Greenfield, meanwhile, announced this month he is partnering with Montreal-based Enerkem Technologies Inc., which has a "gasification" process that turns biomass and other organic materials into a synthetic gas that is later converted into ethanol. No enzymes required.

The two companies plan to design, build and operate commercial-scale cellulosic ethanol plants as part of a joint venture. The first plant location has already been selected - though the companies aren't disclosing where - and a second plant is in development.

"We've had a pilot plant since 2003 that has operated more than 3,000 hours, with feedstock as diverse as municipal solid waste, spent plastics, power poles, dried sludge and forest biomass," says Vincent Chornet, chief executive officer of Enerkem.

The company is currently building an industrial-sized facility in Westbury, Quebec that will process old wooden power poles from Hydro-Quebec.

Dottori said the plants Greenfield and Enerkem want to build will be 10 to 15 times larger, and located in urban centres. "If the Westbury plant works then we'll say, let's go with a bigger one."

What all these plants will attempt to show is that ethanol can be made from non-food crops and "waste" materials in a way that's sustainable over the long term and economical, particularly as the price of a barrel of oil creeps up.

Currently, ethanol producers have to pay, and lately dearly, for corn. But the owner of a cellulosic ethanol plant may, down the line, get paid to take waste products off someone else's hands. It flips around the economics of producing ethanol, in that the zero or negative cost of feedstock offsets the higher initial capital cost of building a cellulosic ethanol plant.

For example, Greenfield could get paid by a city like Toronto to take the material collected from our municipal green bin program. The ethanol produced could then be used in local transportation. No impact on cattle feed prices. No rioting Mexicans worried about tortilla scarcity. And the benefit of reducing our dependence on land fills.

"The general public is misinformed," says Chornet, adding that talk of cellulosic ethanol being a distant dream is far from reality. "What you're seeing now is entrepreneurial groups working away secretly on getting to market. I don't think it's many years away. I think it's very close."

Dottori admits that the first couple of plants will be expensive experiments. "The question is how do you scale it up and make it viable commercially. I think it's doable."

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