Availability Advantage: Ethanol's Opportunity

by Lisa Gibson (Ethanol Producer Magazine) As the sustainable aviation fuel industry in the U.S. takes shape, it’s becoming clear that an all-of-the-above approach to feedstock and technology will present the best chances of meeting aggressive domestic production goals. But existing supply constraints in lipid markets are raising concerns that ramping up the SAF industry will cannibalize feedstocks for other renewable fuels.

Ethanol’s current 17.7-billion-gallon industry has an enormous opportunity to occupy a share of the SAF feedstock pie and potentially help relieve pressure on global oilseed markets. Through the Inflation Reduction Act’s 40B and forthcoming 45Z structures, pathways that result in a 50% greenhouse gas (GHG) reduction over conventional jet fuel receive a $1.25 per gallon tax credit, with higher GHG cuts reaping as much as $1.75 per gallon. The U.S.’s SAF Grand Challenge outlines incremental goals, starting with 3 billion gallons in 2030 and increasing to 35 billion by 2050.

“The issue is that we’ve set these really lofty goals,” says Susan Stroud, analyst at No Bull Ag. “It’s not just the U.S.—it’s all of these increasing targets around the world. We’re ramping up and we’re going green in a big way, and that puts more pressure on all feedstocks.”

Renewable diesel, in particular, is experiencing dramatic growth, which is expected to continue through 2030.

“As we’ve seen production ramp up in an unprecedented way for RD, one of the big results is, as we see demand for those fat, lipid feedstocks grow, soybean oil wins as default because it [has been] the most widely available and the most relatively inexpensive,” Stroud says. “But the abundance of soybean oil that we’ve had is the reason we saw it take the largest piece of the pie for so long.”

She adds, “That’s going to be squeezed out eventually when SAF comes online.”

Total soybean crush capacity in the U.S. is expected to grow 23% in the next three years. But U.S. soybean oil demand is expected to grow from an estimated 27.45 billion pounds in the 2023/24 marketing year to a projected record of 28.8 billion pounds in 2024/25, Stroud says. One bushel of soybeans yields just 11 pounds of oil.

“Yes, I think you’ll see some of that renewable diesel capacity pivot to SAF,” says Jimmy Samartzis, chief executive officer and board director of LanzaJet, which operates an alcohol-to-jet fuel production facility in Georgia. “It will be a shift from one product to another product ... For ethanol, it’s a phenomenal opportunity to provide support for the aviation sector through technologies like ours.”

Samartzis also points to a LanzaTech technology under development that can convert the pure carbon dioxide from fermentation at ethanol plants into more ethanol. “So instead of sequestering it or shipping it out, you can actually make a really low carbon-intensity ethanol reusing that CO2 that gets created through the ethanol production process.”

With CI reduction, Stroud, Csonka and Samartzis all agree that ethanol can play a key role in SAF markets. Plenty of research even suggests the SAF Grand Challenge cannot be met without the help of ethanol. But demand will be crucial, too, and some states with airline hubs are setting up SAF incentives to encourage development and the economic benefit it would bring. READ MORE

Excerpt from North Dakota Monitor: The U.S. Environmental Protection Agency only reports the amount of carbon dioxide that ethanol plants emit from gas-powered processes. Seven million metric tons was the approximate sum of those emissions from the 57 Summit-partnered ethanol plants in 2022.

The EPA does not report the amount of corn-fermentation carbon dioxide emitted. That’s because fermentation emissions are considered cyclical. Corn pulls carbon dioxide out of the air as it grows in a cornfield. Then it releases carbon dioxide back to the atmosphere as it ferments in an ethanol plant. Finally, farmers plant more corn, and the cycle continues.

Summit declined to release amounts of CO2 emitted from corn fermentation at its 57 partner ethanol plants. Ben Nelson, Summit’s director of carbon programs, said a typical 100-million-gallon plant produces about 286,000 metric tons of fermentation CO2.

Sanchez, of California-Berkeley, said “modern and efficient” ethanol plants emit about 90,000 metric tons of fermentation CO2.

The diverging estimates mean the Summit pipeline and its 57 partner plants could capture anywhere from 5 million to 16 million metric tons of fermentation CO2 annually — both of which are within the pipeline’s proposed capacity of 18 million metric tons.

For comparison, approximately 1,300 power plants across the U.S. emitted about 1.5 billion metric tons of CO2 in 2022.

“This is both a giant pipeline project and a drop in the bucket,” Sanchez said.

Aiming for net-negative

Sanchez added that if an ethanol plant replaces its natural gas use with something sustainable, while also capturing and storing its fermentation CO2 emissions, it can pull more greenhouse gases out of the atmosphere than are released in the production lifecycle of ethanol associated with the plant.

Nelson pointed to a 2022 report for the Renewable Fuels Association that said ethanol production could reach net-negative emissions by 2040. The report indicates carbon sequestration at ethanol plants would make the biggest difference – a bigger difference than industry-wide implementation of farming practices that sequester more carbon in the soil, such as less disruptive tillage practices and planting cover crops.

Nelson said the average ethanol plant emits about 55 grams of CO2 per megajoule (a unit of energy) of ethanol produced, and Summit’s project would lower that to about 25 grams of CO2.

“Achieving net-negative emissions will also require other efforts such as climate-smart farming, using renewable natural gas, renewable electricity at ethanol plants, and improving plant efficiency,” Nelson said.

In South Dakota, some ethanol plants are already receiving what’s been coined “renewable natural gas” derived from landfill emissions, and a Brookings area utility company is sending the methane emitted from dairy livestock manure to be mixed into regional natural gas supplies. READ MORE