Biofuels Producer Launching Ethanol Replacement

Source: By Jared Anderson, AOL Energy • Posted: Thursday, May 3, 2012

In the race to commercialize the next generation of advanced biofuels created from inedible plant material, 50/50 BP-Dupont joint venture Butamax is pushing to make biobutanol the next big thing. The company is moving toward the commercial phase of its program to make biobutanol the US fuel blend of choice.

“We are very excited about this product – biobutanol is the highest value biofuel that can be made,” Butamax CEO Paul Beckwith recently told AOL Energy.

In 2003, Dupont was looking to leverage their work with industrial chemicals derived from biomass and approached BP to discuss the feasibility of entering the transportation fuel market. The companies spent the next several years addressing technical details and securing a large patent portfolio. The partners officially formed their joint venture in 2009.

Biobutanol is a four-carbon alcohol that can be produced from the same feedstocks currently used to make ethanol. The goal is to ultimately move toward cellulosic biobutanol in line with industry trends in this direction. Both BP and Dupont have cellulosic biofuel facilities under construction, said Beckwith.

The industrial alcohol provides increased efficiency to refiners when blending gasoline by allowing lighter components like pentane, ethane and butane to remain in the blend. When using biobutanol as a blend stock, refiners can produce a greater volume of gasoline from a barrel of crude oil.

Dethroning Ethanol as the Fuel Blend of Choice

The Butamax business model is to work with existing biofuels producers to make biobutanol by retrofitting ethanol plants in the US. Biobutanol is considered a “drop in fuel,” which means it can be dropped directly into existing fuel transportation and distribution infrastructure.

The economics of biobutanol are driven by feedstock costs, or the spread between oil prices and corn prices, at least until cellulosic technology becomes widespread. It costs about 25% more to produce a gallon of biobutanol than it does to produce an equivalent volume of ethanol, but biobutanol’s value to the market is greater, according to Beckwith.

Butamax is breaking ground on its first commercial plant in 2013 and expects to achieve initial production by late 2014. Ethanol producers are being approached with the prospect of becoming butanol producers, and Beckwith says his company has a pipeline of producers ready to retrofit their plants. In fact, Butamax announced last week its partnership with industrial contractor Fagen, a company that has constructed 60% of the ethanol production capacity in the US.

Butamax’s current goal is to bring its first commercial plant on stream, then scale up to 5 or 10 plants throughout the course of the decade.

“We will seek to match supply with demand,” said Beckwith.

Regulatory uncertainty is one of the larger challenges Butamax faces as it looks to grow its operation. As with other alternative energy technologies, a Renewable Fuel Standard in the US provides to momentum and stability around that policy is important to the firm. Any legislation that weakened RFS requirements would be a major setback for biobutanol commercialization.

Another challenge will be constructing new plants designed to process cellulosic feedstock. “Retrofits are no problem, but building new facilities will require a big effort,” Beckwith said.

Other companies committed to biobutanol commercialization include Gevo, Cathay Industrial Biotech and Cobalt Technologies.