The Trash Spread: Enerkem Heads for Scale, with Advanced Biofuels from MSW
by Jim Lane (Biofuels Digest) Breakthroughs in making consistent syngas from negative-cost municipal solid waste spells “big prospects” for Enerkem in biobased fuels and chemicals.
In oil we have the crack spread, corn ethanol and soy-based biodiesel we have the crush spread; with municipal solid waste, we should begin tracking the trash spread.
As with all of the traditional commodities, that’s the difference between the value of the raw materials and the product you propose to make. It’s the refiner’s margin.
How are the spreads today? Crack spread, 69 cents; corn ethanol, 83 cents (including ethanol and distillers grains). The trash spread? A whopping $2.65 for waste-to-ethanol – because its a negative cost feedstock (in the $0.12 per gallon range).
…(W)ith the caveat that the technology is new and companies are building out demonstrations and first commercial plants right now. INEOS Bio’s fist small commercial is in commissioning, Terrabon and Fulcrum are working towards first commercial, and Enerkem is building its first 10 million gallon commercial plant in Edmonton, Alberta right now.
Another reason is that investors and lenders have been irrationally inexhuberant about the sector. Why is that? Generally, uncertainties, of which there are three.
1. Will landfill tipping fees hold up? Can MSW remain a negative or zero-cost feedstock for long?
2. Will the market for ethanol continue to provide room for growth?
3. Do the processing technologies pass the SARA test – are they sustainable, affordable, reliable, and available? READ MORE