The three major methods of pretreatment that allow the recovery of solid cellulose are based on physical, biological, and chemical technology (Hsu et al. 1996).

• Physical pretreatments. Physical pretreatment involves reducing the size of the biomass particles so cellulases have access to the cell wall materials with reduced interference from the lignin and hemicellulose. An example of this is dry ball milling of biomass, which is very energy intensive and not likely to become practical at large scale (Zhu et al. 2008). In physical pretreatment, most of the lignin, cellulose, and xylan remain in the solid phase.

• Biological pretreatments. Biological pretreatment uses enzymes or microorganisms to produce simple sugars from the carbohydrate polymers with minimal mechanical milling of the biomass. Although biological pretreatment is usually less energy intensive than chemical or mechanical pretreatment, it is still in the early stages of development (Sawada et al. 1995) . Bio-pulping, not yet economically competitive with traditional pulping methods, is one example of biological pretreatment. Depending on the enzymes or microorganisms used, cellulose and/or hemicellulose may be hydrolyzed and even metabolized by the pretreatment strain.

• Chemical pretreatment. Chemical pretreatment is the most widespread method currently in use. Biomass is pretreated using acid or base, usually in combination with high heat and/or pressure. Many pretreatment conditions and catalysts have been used in biomass conversion, including concentrated and dilute acid, steam explosion, alkali, organic sol­vents, and ammonia. Biomass pretreatment has also been reviewed earlier by Dale (1985).

Acid hydrolysis is the most common method, with sulfuric, hydrochloric, and phosphoric acid all being used (Hsu et al. 1996). Nitric and peracetic acid have also been used, but their method of action is not polysaccharide hydrolysis, but rather by fiber matrix degradation through lignin oxidation. Acid hydrolysis is typically carried out under conditions that maxi­mize hemicellulose hydrolysis and minimize cellulose degradation. The most widespread process is the use of dilute (less than 1% w/v) sulfuric acid in combination with heat and pressure. Dilute sulfuric acid is inexpensive and hydrolyzes the hemicellulose almost com­pletely, while degrading little of the cellulose. The drawbacks of this method are the demand for corrosion-resistant equipment and disposal of large amounts of gypsum generated during neutralization. Sulfuric acid pretreatment leaches toxic metal ions from the equipment and converts small amounts of glucose to hydroxymethyl furfural and xylose to furfural. Other inhibitors produced include oxidized phenolics from lignin degradation and acetic acid from xylan hydrolysis (van Walsum et al. 1996). Phosphoric acid is a weaker acid, causes few waste disposal problems, and can be used as a nutrient by yeast after neutralization with ammonia. However, phosphoric acid is about eight times as expensive as sulfuric acid.

Pretreatment with lime at elevated temperatures has recently been developed as an alterna­tive pretreatment. Chang and coworkers demonstrated that pretreating switchgrass with 0.1 g Ca(OH)2)g dry biomass at 100°C or 120°C for 2 hours removed 29% of the lignin while hydrolyzing only 10% of the cellulose and about 27% of the xylan (Chang et al. 1996). The xylan and cellulose contents of the original biomass were about 21% and 37% (w/w), respec­tively. Accounting for the loss of xylan in the pretreatment, the xylan hydrolysis was near 100% theoretical after treatment with commercial cellulase preparations. Xylan hydrolysis was probably enhanced through the alkaline deacetylation of the hemicellulose. Removing the ester-linked groups greatly enhances the digestibility of the xylan by exposing the xylan backbone to enzyme hydrolysis. Although lime pretreatment gave high yields and excellent digestibility, the sugar loss during the pretreatment process was significant, with 10% of the cellulose and 27% of the xylan lost to the liquid stream.

In addition to the already mentioned methods, other pretreatment methods have been used, including steam explosion, acid catalyzed steam explosion, ammonia fiber explosion, organic solvents, supercritical fluid, irradiation, oxidizing agents, alkali, liquid hot water, ammonia recycled percolation, and ammonia-hydrogen peroxide percolation (Iyer et al. 1996; Kim and Lee 1996).

Harvest and collection constitutes gathering and removing the biomass from field. The opera­tions depend upon the state of biomass on the field. This includes the type of biomass (grass, woody, or crop residue). The moisture content and the end use of biomass also affect the way biomass is collected. For crop residue, the operations need to be organized in companion with the grain harvest. In this section, we examined advanced systems that may be used to gather biomass residues.

Harvesting

For crop residues, grain harvest most probably will take the center stage. All other operations, such as residue management and collection, take place after grain is harvested. This situation may change in future but at the present time this is the case. Figures 7.2 and 7.3 show the present and future scenarios for harvesting crop residues. Future scenarios are highlighted in the larger boxes encompassing more than one unit operation In the case of corn, a combine takes a small portion of the corn stalks. The majority of the corn stalk left in the field is anchored to the ground. The stalks need to be shredded before a baler can pick them up. Figure 7.3 also shows the use of new stripper headers for harvesting grain. Stripper headers strip the grain from the stalk and leave the stalks standing in the field. The straw stalks are then cut and placed in a swath for baling.

Loafing is an attractive option, because collection, densification, and transport to the side of the farm can be done with a single equipment unit. Loafing of stover is practiced in Iowa but its performance with straw and dedicated crops is unknown. Corn stalk moisture is high especially early in the season. One option is to chop the high moisture stover and store it in a bunker silo as silage. This option is under investigation.

Cutting and Field Drying

In the case of straw the biomass is generally dry. For stover the leftover biomass after grain harvest may be dry or wet. In the case of switchgrass, depending on the time of harvest, the

biomass may be wet as much as 80% moisture content in the middle of summer to a low of 20% at the end of the growing season. A field shredder is used to cut the material to pieces and spread on the field for drying. For green switchgrass, mowing may be combined with conditioning, where the cut material passes through two or more rollers. The rollers break the green stems at several points along the stalk. The bruise and cut provide escape routes for the plant moisture to evaporate quickly. Various degrees of maceration or severe bruising and cutting (super conditioning) have been developed in recent years.

When switchgrass is dry and standing in the field, a mower would be adequate to cut the plant and place it in a swath for immediate baling. No conditioning or maceration is needed. This statement was validated by Venturi et al. (2004) who recommend mowing and condi­tioning during early season but only mowing late in the season as the moisture content of the plant decreases. But, they also found that round baling late in the season is difficult due to the toughness and lack of pliability of the straw.

For wheat, cutting is not required as the height of cut can be adjusted during combining. In stripper header combining, standing stalks are cut and windrowed for baling. For most cases, straw is of low moisture content at the time of grain harvest or immediately after grain harvest. Operations to expedite field drying of straw may not be needed.

For corn stover, grain and stalk are at different moisture content during harvest. Figure 7.4 is a plot of stover moisture content and grain moisture content after the kernel has matured to 40% moisture content (Sokhansanj et al. 2008). Stover moisture content initially at more than 75% (w. b.) drops to 10% toward the end of harvest season. Special operations are needed to deal with the variation in moisture content. Shredding the stover and spreading it with the combine accelerates field drying. The spread material then has to be raked into windrows for efficient baling. Many operations use a flail shredder to shred the broken stalks while gathering the shredded material in a windrow in a single operation.

Collection

Collection is defined as operations for collecting, packaging, and transporting biomass to a nearby site for temporary storage. The most conventional method for collecting biomass is baling. Bales are in the form of either rounds or squares. Round bales are popular on most U. S. farms (Cundiff 1995, 1996; Bransby and Downing 1996; Cundiff and Marsh 1996; Cundiff and Shapouri 1997; Cundiff et al. 2004). Limited experience with using round bales for biomass applications indicates that round bales are not suit­able for large scale biomass handling. Because of their round shape, round bales tend to deform under static loads in a stack. Bales that are not perfectly round cannot be loaded onto trucks to form a transportable load over open roads. Experience with switch — grass harvest at the Chariton Valley Co-Firing project in Iowa (CV—RC&D. Chariton Valley Biomass Project Design Package 2002; Miles 2006) showed that variations in the density of round bales were the cause of uneven cuts and erratic machine operation during the de — baling process.

Timothy C. Lindsey

Abstract

Basic corn-to-ethanol manufacturing processes have provided important first steps for bio­refining operations but have barely scratched the surface with respect to overall biorefining opportunities. Multiple options exist to modify or supplement existing processes to make these plants more productive and increase the types and quantities of valuable materials that they produce. Some low — value byproducts and wastes generated from these facilities can be converted into higher value products. Additionally, byproducts and wastes from other industries, such as food processing, landscaping, paper, and municipal solid waste facilities, could be substituted for crops as feedstocks and processed into ethanol. This chapter focuses on two incremental modifications that dry-mill ethanol plants could imple­ment that would enlarge their feedstock options and also expand the products and associated value of their output. The proposed modifications include (1) incorporation of cellulosic feedstocks into existing operations and (2) recovery of oil for sale as a value-added product. Modification of existing processes to accommodate cellulosic feedstocks could greatly improve the diversity and flexibility of feedstock options. Recovery of oil from by products such as germ, thin stillage syrup, or dried distillers ’ grains and solubles (DDGS) could expand greatly the quantities and value of products produced from dry-mill plants and also provide valuable feedstock options for biodiesel producers. Multiple other opportunities exist for expanding and diversifying dry-mill ethanol plant feedstocks, processes, and prod­ucts but are beyond the scope of this chapter. For instance, DDGS could be further frac­tionated to separate and pelletize high-protein/high-value components from lower value materials. Cogeneration systems could be implemented to burn lignin and other coproducts to simultaneously produce steam and electricity, thereby reducing electricity requirements from external sources and providing electrical power for additional biorefining operations. Ethanol is an important industrial ingredient and has widespread use as a base chemical for other organic compounds. These include ethyl halides, ethyl esters, diethyl ether, acetic acid, butadiene, and ethyl amines.

Biofuels from Agricultural Wastes and Byproducts Edited by Hans P. Blaschek, Thaddeus C. Ezeji and Ju rgen Scheffran 161 © 2010 Blackwell Publishing. ISBN: 978-0-813-80252-7

Introduction

Today ’s ethanol industry is frequently criticized for being resource intensive in terms of energy, water, grain, fertilizer, and other inputs required for production. While the ethanol produced at these facilities is a very valuable fuel, numerous opportunities exist to reduce waste and expand the diversity of both the inputs and the outputs associated with their opera­tions. Multiple options exist to modify or supplement existing processes to make these plants more productive and increase the types and quantities of valuable materials that they produce. Some low-value byproducts and wastes generated from these facilities can be converted into higher value products. Additionally, byproducts and wastes from other industries, such as food processing, landscaping, paper, and municipal solid waste facilities, could be substituted for crops as feedstocks and processed into ethanol. This would reduce the strain on food resources commonly associated with biofuels production.

Basic corn-to-ethanol manufacturing processes have provided important first steps for biorefining operations but have barely scratched the surface with respect to overall biorefining opportunities. This chapter focuses on two incremental modifications that dry-mill ethanol plants could implement that would enlarge their feedstock options and also expand the prod­ucts and associated value of their outputs. The proposed modifications include (1) incorpora­tion of cellulosic feedstocks into existing operations and (2) recovery of oil for sale as a value — added product.

The United States currently converts approximately 15 million tons of agricultural products into ethanol and biodiesel and discards approximately 270 million tons of agriculturally derived residues in the form of harvestable crop residues, animal manure forest residues, and the organic fraction of municipal solid wastes (Baker 2006). As of February 2006, the annual capacity of the U. S. ethanol sector stood at 4.4 billion gallons, and plants under construction or expansion are likely to add another 2.1 billion gallons to this number (Clements and Van Dyne 2006). According to the U. S. Department of Agriculture Agricultural Baseline Projections (released in February 2006), the share of ethanol in total corn use will rise from 12% in 2004-2005 to 23% in 2014-2015. A comparison of the 2006 Baseline with the 2005 Baseline suggests that much of the increased use by ethanol producers will be diverted from potential exports because the 2006 Baseline projects higher use for ethanol and lower exports than the 2005 Baseline.

With a corn-to-ethanol conversion rate of 2.7 gallons per bushel (a rate that many state-of — the-art facilities are already surpassing), the U. S. ethanol sector will need 2.6 billion bushels per year by 2010, which is 1.2 billion bushels more than it consumed in 2005 (U. S. Department of Agriculture, Economic Research Service 2006) Adaptation of the market to this increased demand is likely to be one of the major developments of the early 21st century in U. S. agriculture.

Lopez et al. (2004) isolated and identified new microorganisms for biological treatment of lignocellulosic hydrolysates. Several isolates with potential for abatement of inhibitors from complex fermentation substrates were obtained from soil by enrichment procedure, and selected according to their potential for depletion of toxic compounds from acid-pretreated hydrolysates. The selection was carried out in a defined mineral medium containing a mixture of ferulic acid, 5-hydroxymethylfurfural (5-HMF), and furfural as the carbon and energy sources, followed by an additional transfer into a corn stover hydrolysate (CSH) prepared using a dilute acid. Six isolates, including five bacteria related to Methylobacterium extorquens, Pseudomonas spp., Flavobacterium indologenes, Acinetobacter spp., Arthrobacter aurescens, and one fungus, C. ligniaria, were chosen based on stable growth on the above substrates. All six isolates depleted toxic compounds from the medium, but only C. ligniaria C8 (NRRL 30616) was effective at metabolizing furfural and 5-HMF as well as aromatic and aliphatic acids, and aldehydes (Lopez et al. 2004; Nichols et al. 2008- . This strain removed 78% of 5-HMF and 97% of furfural, while overliming only decreased 51% of the total furans (Martinez et al. 2001- . The possibility of including biological detoxification with C. ligniaria C8 in a biomass-to-ethanol conversion process with S. cerevisiae was tested at laboratory scale. The treatment of hydrolysate with C. ligniaria C8 also resulted in improved metabolism of pentoses by a recombinant bacterial strain, E. coli FBR5 (Nichols et al. 2008). The E. coli FBR5 has a native ability to ferment glucose, xylose, and arabinose, and carries recombinant genes for selective production of ethanol. All sugars in hydrolysates treated with C. ligniaria C8 were consumed more quickly by the E. coli FBR5 than sugars in untreated hydrolysates.

Animal Wastes on the Farm

Because animal wastes consist of high solid levels (e. g., 20-100 g volatile solids [VS]/L for swine waste [2%-10% VS]), anaerobic treatment of animal waste offers many advantages over aerobic treatment, such as low electricity requirements (no O2 addition is required), greater than 50% solids reduction, value-added biogas production, nutrient conservation, and odor reduction. However, post-treatment of anaerobic effluent may be necessary to convert, remove, and possibly recover nutrients. The liquid fraction of the treated animal waste from the digester must be recovered and applied to agricultural lands and this may cause odor, pathogen distribution in the environment (Collick et al. 2006), nitrogen pollution of ground water (Kross et al. 1993), nitrogen and phosphorus run off (Gerard-Marchant et al. 2005), and dissipation of antibiotic-resistant genes into the environment (Chee-Sanford et al. 2001; Aminov et al. 2002; Angenent et al. 2008).

Despite the need for further treatment to prevent environmental problems, the increasing size of confined animal feeding operations (CAFOs), encroaching urbanization, greenhouse gas emissions, heightened awareness of local air pollution (including odors and ammonia), and contamination of water have created strong incentives to develop long-term environmen­tally sound manure management practices and systems that include anaerobic digesters. The process of anaerobic digestion is not new and has been utilized for decades to manage animal wastes. More recently the opportunity to capture methane to develop a combined heat and power (CHP) system has attracted much attention in developed countries. The heat and elec­tricity generation on the farm (cogeneration) has led to increasing numbers of anaerobic digesters.

With the further development of net metering (i. e., selling to the electrical grid) for farm anaerobic digesters in many localities, the economic benefits of installing digesters are enhanced. However, researchers still look for other biogas utilization systems besides CHP because, from the perspective of simplicity of operation and thermodynamic efficiency, the most desirable and least expensive option is to use biogas in a boiler or other combustion process for heat generation. To benefit from this, however, a proximate demand for this heat must be available. An alternative option is to upgrade biogas (50%-60% methane) to pipeline natural gas quality (95%-98% methane). To upgrade biogas, a system that includes pres­surization and removal of contaminants (particularly hydrogen sulfide) and CO2 must be procured. Thus, this option is limited to large CAFOs, a community digester receiving wastes from numerous farms, or a gas pipeline connection fed by a number of farms.

The economic assessment of farm-based anaerobic digesters is complex because each farm digester system is specifically designed for that site. For example, the variations within New York State include farm systems that do not generate electricity, farms with microturbines for CHP, and farms with internal combustion engines. One study for the New York State Energy Research and Development Authority (NYSERDA) showed that the net predicted annual benefit per cow for five farms with digesters varied from -$106 to +$299 (Gooch et al. 2007). The negative or low benefit per cow was on farms with only dairy manure digestion while the farm showing a positive benefit was receiving food wastes (co-digestion), which increased biogas production and was paid a “tipping fee” to accept the wastes.

To begin our search for new and diverse enzymes relevant to the deconstruction of the plant cell wall and conversion of their polysaccharides to soluble sugars, the best resource today is the CAZy database (http://www. cazy. org/). At this website, the various glycoside hydro­lases and related CAZymes (notably the carbohydrate esterases and the pectate lyases) are categorized into families and listed with appropriate information and links. Tens of thou­sands of enzymes are catalogued, and vital details, both general and specific, are very easily accessible.

Figure 5.4. Continuum for discovery and optimization of carbohydrate-active enzymes.

In view of the fact that many aerobic fungal and bacterial free enzyme systems comprise only a few (six to ten) major endo — and exo-glucanases and similarly restricted numbers of hemicellulases, carbohydrate esterases, and pectate lyases, it is somewhat surprising that we could or would want to examine more than the known CAZymes for their applicability in conversion processes. How much more diversity do we need over and above the enzymes listed in the CAZy database? Surely, the natural enzyme systems, particularly those from a given microbial species, are most coordinated among themselves and have “learned through evolution” to interact in an optimized manner to achieve maximum degradation of the plant cell wall polysaccharide substrates.

Nevertheless, Mother Nature’s needs are different from ours, and the natural ecosystems are not necessarily attuned to the requirements of our human desires and our industrial pro­cesses designed to achieve them. Consequently, there is a current trend toward discovery of new enzymes and improvement of known enzymes for the purpose of conversion of large amounts of cellulosic biomass to their simple sugar constituents.

In this section, the state of the art of the existing technologies for supply of biomass from the farm to a biorefinery was analyzed. Several scenarios for potential technologies that will reduce the cost of supply were presented. The analysis shows that the following are key components to reduce costs:

• Reduce the number of passes through the field by amalgamating collection operations.

• Increase the bulk density of biomass.

• Work with reduced moisture content.

• Densification (pelletization or briquetting) is a viable option although the existing technology of densification is expensive.

• Trucking seems to be the most prevailing transport option but other modes of transport such as rail and pipeline may become attractive once the capital costs for these transport modes are reduced.

A biorefinery requires biomass in a form that could yield the maximum conversion prod­ucts. Among the desirable specifications is cleanliness of the biomass—to be free from dirt, stone, synthetic fibers, and oil. It is also desirable to have biomass at a uniform moisture content and particle size distribution. Further physical and chemical specifications will become important as conversion technologies advance. Biomass also has to be preprocessed to increase its bulk density and its flowability. A densely pelleted biomass takes much less space than a bulky fibrous biomass. The dense pelleted biomass can also flow easily. Biomass can be engineered to meet both the requirement of a biorefinery as well as its low-cost safe handling issues.

A view of the economics of converting cellulosic biomass to ethanol can provide a useful context for understanding the impact of feedstock cost and availability on competitiveness. However, it is vital to keep in mind that no cellulosic ethanol plant has yet been built, and

although various cost estimates have been published, all such analyses are just estimates (Wooley et al. 1999a; Aden et al. 2002). Thus, such information is primarily useful to help understand key cost drivers that can have a strong influence on costs, but accurate information will not be possible until several operational plants have accumulated enough of a learning curve to be reaching technology maturity. In addition, costs are highly dependent on the technology chosen for the design, and many low-cost approaches are not accessible as they are often protected as trade secrets and know-how. For this reason, this chapter will provide a basic outline of processing costs, and the reader is referred to other publications for detailed process designs and estimates while keeping in mind the approximate nature and other limita­tions of all of such analyses (U. S. DOE 1993; Wooley et al. 1999a, b; Aden et al. 2002).

A facility for processing a nominal 2000 dry tons per day of corn stover or 666,666 dry tons annually based on typical on — stream times is taken here to provide a perspective on the economics of converting agricultural residues into ethanol. In general terms, the process is based on use of dilute sulfuric acid for pretreatment and other features as outlined early in this chapter. Furthermore, the composition of corn stover is based on that reported in a coordinated study by the Biomass Refining Consortium for Applied Fundamentals and Innovation (CAFI), as summarized in Table 9.4 (Wyman et al. 2005b). This table also includes the maximum amount of ethanol that could be produced from these sugars at the theoretical limit.

Operating conditions for this analysis are as developed by Lloyd and Wyman as part of the CAFI study to achieve the highest total yields of glucose plus xylose from corn stover in a coordinated comparison to performance with other pretreatment options (Lloyd and Wyman 2005). For this approach, Table 9.5 outlines the operating conditions employed experimen­tally and the corresponding sugar yields. It is further assumed that these sugars can be fer­mented to ethanol with yields of about 92% of the theoretical maximum based on experience in industry and with the recombinant organisms employed for fermenting the five carbon sugars arabinose and xylose as well as galactose and mannose in addition to fermentation of glucose, and that 99.9% of the ethanol can be recovered in distillation and dehydration using proven technology. The lignin is burned to generate heat and power, and any extra left after heating streams and providing power in the process is exported for sale.

From this information, cash costs were estimated based on the assumed costs for feedstock, sulfuric acid, lime, nutrients, and labor outlined in Table 9.6. Enzyme costs were not included at this point because of the uncertainty in these values and will be considered later. Based on the yields reported by Lloyd and Wyman, the total estimated cost is about $0.785/gal prior to subtracting any coproduct credit for exported power. Because others have reported much lower yields based on less optimal performance data, a breakdown of operating costs are also included for lower overall ethanol yields of 82.6 and 73.6 gal/dry ton to give total costs estimates of $0.847 and $0.942/gal, respectively.

These estimates clearly show the importance of biomass costs in the economics as they dominate the overall cash costs. Thus, it is highly desirable to seek low-cost agricultural resi­dues that can dramatically cut these costs. However, several other points must be kept in mind for these rough estimates. First, they are at the plant gate and do not include transporta­tion, taxes, marketing, and a myriad of other costs that must be adsorbed before the fuel reaches the consumer. In addition, up to 50% of these totals could be added to compensate for the fact that ethanol contains about two-thirds the energy content of gasoline; however, ethanol can also be used more efficiently than gasoline in a properly optimized engine, which can make up for up to 50% of this difference (Bailey 1996). Although benefits are factored into the labor costs as 30% of wages and plant supervision and management are included, these costs do not include other overhead or manufacturing costs such as maintenance and administration or other costs that are typically factored off of capital estimates. First plants may also require more labor than assumed here.

A rough estimate of the income from sale of electricity is included in Table 9.6 based on a selling price of $0.05/kwh for power. In this analysis, about a third of the heat gener­ated by burning residues was calculated to be left for generating electricity at an assumed efficiency of 33%, that is, 1 Btu of electricity is assumed to be produced for every 3 Btu of heat available. These calculations take a penalty for the water in the lignin and other residuals by assuming somewhat more than half is water that must be vaporized during combustion. Furthermore, these values do not address the amount of electricity needed to run equipment because of the detail required for such estimates, but they also do not include any possibility of heat exchange or cascading to substantially reduce the amount of heat needed to bring the biomass feed up to pretreatment temperature or heat up the large fer­mentation beer stream to boiling for distillation. Thus, these values should be regarded as providing a rough idea of how much revenue could be gained from selling power, with the upper bound being about three times the value given and the lower bound being zero, the latter corresponding to either no power left to sell or no market into which to sell it. Of course, these values should be scaled proportionately if a higher or lower selling price is assumed for electricity.

Table 9.6 also includes a more mature performance case that obtains better yields for each step in the process, as outlined in Table 9.5 . Now, a cost of about $0.686/gal of ethanol is calculated for a feedstock cost of $60/dry ton, as outlined in this table. This estimate would drop to on the order of $0.64/gal after subtracting for sale of coproduct power, again subject to all of the caveats described above for other costs, capital recovery, and sale of power. Overall, the estimates show that high yields are beneficial, but that sale of power can some­what compensate by gaining value from the unutilized fraction. In addition, even the costs without including power and for low yields could be competitive with gasoline and ethanol from corn.

The cost estimates above do not include repaying for capital or the interest on debt to obtain that capital. However, estimating capital costs is extremely challenging, and as a result, most values can only be used as a rough guideline as to what to expect. For that reason, we will employ a guesstimate of $4.00/annual gallon for the 2000 tons/day base case to give a rough idea of the investment level required. This value is in line with estimates developed by NREL and others (Eggeman and Elander 2005; Wooley et al. 1999a). It is also consistent with the idea that a cellulosic ethanol facility combines the capital needs of a corn ethanol plant to make sugars and ferment them to ethanol with the capital demands of building a biomass power plant to burn the residual lignin and other unutilized portions of biomass to produce heat and power for the process with excess to export. In addition, we expect the ethanol facility to be somewhat more expensive than for a corn ethanol process because of the harsher condi­tions required for pretreatment and the longer times and more dilute solutions for sugar fer­mentation. Thus, about $4.00/gal appears in the right range. Yet, first projects can be more expensive than this estimate because of concerns about inexperience with the technology and resulting overdesign to ensure the project is successful. Learning curve experience will rapidly lower the cost once a facility is running through greater throughput with the extra equipment and improvements in operating conditions and biological catalysts (Goldemberg et al. 1993; Moreira and Goldemberg 1999).

Another aspect of capital costs is that they do not change linearly with scale of operation but scale as a fractional power of size. For example, employing the exponent of 0.67 often used as the norm would result in the capital cost increases by about 59% when the size of the operation is doubled instead of being 100% more expensive. Such economies of scale can be understood from the perspective that amounts of material and fabrication labor are proportional to surface area while capacity is proportional to volume of an equipment item. Furthermore, the surface to volume ratio of equipment drops with increasing size and does not increase linearly. Exponential scale factors vary with the type of equipment, as tabulated in several reference books and are almost always less than 1.0 (Peters et al. 2003). The result is that unit capital costs drop as the process throughput increases, leading engineers to favor larger-scale operations to minimize capital costs. Consequently, the assumed cost of $4.00/ annual gallon for cellulosic ethanol would drop to about $3.18/annual gallon if the capacity was doubled to 4000tons/day and the 0.67 exponent were applicable.

To counter the possibility of lower unit costs for larger facilities, it is often stated that economies of scale cannot be realized in biomass processing because of the low density of biomass crops. However, if we consider that, about 3.75 dry tons of corn stover/acre would result for a corn productivity of 150 bushels/acre given the virtual one-to-one ratio of above­ground plant to corn kernels. In addition, within the 50-mile radius typically considered to be reasonable for collecting corn and wood, this volume of corn stover production would amount to about 1.875 billion gallons of ethanol. Even if we assume that only 1.0dry tons/ acre on average can be accessed and/or removed sustainably from the field, the result would be about 500 million gallons of ethanol annually within the 50-mile radius. A few studies have clearly shown that even this low harvest rate favors conversion facilities of at least

10,0 dry tons per day, giving an annual ethanol production of about 250 million gallons (Wyman 1995). The primary limitation to building plants of this size is the high capital costs; for example, a 10,000 gallon per year operation would cost on the order of $3.0 billion or more. Although it may be possible to raise such large sums for a mature process, the risk of first applications is considered too great for most investors, and it is extremely unlikely that first projects would be this large.

A key question is how to annualize up-front capital costs over the life of the facility, and a useful approach is based on a projected cash flow coupled with an appropriate discounting formula (Wyman 1995; Wooley et al. 1999a). However, the challenge is the choice of appro­priate parameters in this analysis which are in turn tied to many other factors such as economic lifetime of the plant and expected rate of return by the financing entity. Furthermore, the interest rate and economic lifetime will depend on the stage of technology development as high rates of return are expected for first applications while much lower rates can be negoti­ated once a successful track record is firmly established. Thus, a first project may require payout in only a few years time while mature technology may be able to pay off capital over a period of 20-30 years. Unfortunately, this classical relationship between rate of return and risk presents a major chicken-and-egg dilemma for building first-of-a-kind cellulosic ethanol facilities in that coupling high rates of return demanded by investors with a capital-heavy design to ensure successful operation will almost surely result in overall costs that are too high for the commodity fuel market. In this regard, it is vital to remember that the competi­tion is gasoline which has benefitted from over a hundred years of learning curve advances, paid off capital, substantial subsidies to ensure stable supplies from hostile regions of the world, an established infrastructure, and no consideration for societal costs associated with its use.

Return on capital could result in virtually a 100% capital charge in the first year for new technology from investors demanding fast paybacks to as low as 10%—15% if project finance could be used similar to classical utility financing. Given that fuels are a commodity business, it is unrealistic to expect very rapid payback times. If we take a 20% annual charge as likely for reasonably mature technology, the total of cash cost plus capital charges would amount to something like $1.60/gal for the case based on laboratory data in Table 9.5 and a capital cost of $4.00/annual gallon. To this, additional costs need to be added for maintenance, overhead, and the other aspects mentioned before that were not included. The resulting cost could be promising compared to gasoline when oil prices are high but not when they are at lower levels. However, given their large contribution to the estimated costs, use of a low-cost residue could improve competitiveness significantly.

A key element left out of these estimates is the cost of enzyme. In many studies on enzy­matic hydrolysis of pretreated biomass, enzyme loadings of about 15FPU/g glucan were applied to realize good sugar yields from the pretreated solids. However, at a typical specific activity of about 0.5FPU/mg protein, these loadings amount to on the order of 0.251b of protein/gallon of ethanol produced including the ethanol made from the hemicellulose sugars that are often released during pretreatment. Reports have been made of advances in enzyme technology lowering the cost to about $0.10-0.20/gal (American Institute of Chemical Engineering 20041 American Chemical Society 2005) and such a price would bring the overall cost of ethanol in our simple analysis to something under $2.00/gal. Yet, this price would require protein costs of about $1.00/lb or less, but no offers are known to sell enzyme at such a price. Thus, it appears that enzymes are still very expensive, with costs of about $1.50/gal possible, and such high costs would prevent cellulosic ethanol from being competi­tive when using conventional enzymes.

Overall, this analysis shows that low-cost ethanol is possible from cellulosic biomass if we can bring enzyme costs down, and a particularly promising route to this end is through development of organisms that can both make enzymes and ferment the sugars released, as outlined at the beginning of this chapter. In addition to reducing process steps and capital and operating costs associated with separate enzyme production, the most important advan­tage to this approach called CBP is the anaerobic production of the enzymes needed to break down cellulose and hemicellulose to sugars. This feature overcomes a major barrier to current aerobic enzyme production methods that use huge amounts of energy to compress air and agitate the enzyme production vessels intensely to promote sufficient respiration by the organ­isms to grow and produce enzymes. Furthermore, such high-energy inputs also translate into major power drains on the facility and the need to provide very expensive cooling to remove all the heat generated by such intense aeration and agitation. Thus, unless enzymes are devel­oped with much higher specific activities than historically seen, the best course to low costs appears to be to follow a CBP strategy.

In closing this section, it is vital to point out that the economics of ethanol production are very site specific and for that reason hard to generalize. Such aspects as labor rates and skill levels, biomass type and availability, competing demands for feedstocks, access to raw mate­rials, transport of raw materials and finished products to and from the site, and access to markets can have a large effect on costs. In addition, while this rough analysis has been applied to corn stover because of its relatively large production, other agricultural residues may be more attractive due to cost, susceptibility to conversion, coproduct opportunities, and yields. Thus, one size does not fit all, and careful consideration should be given to regional factors before applying rigid economic evaluations.

In traditional ethanol fermentations S. cerevisiae has been used to produce this biofuel from either sugarcane or corn. These substrates contain glucose or sucrose (a disaccharide of glucose and fructose) and do not contain pentose sugars. Although a natural xylose-ferment­ing yeast, Pichia stipitis produces ethanol with comparatively good productivity (Hahn- Hagerdal et al. 2006- from pentose sugars; it is inhibited when biomass hydrolysates are employed. For this and other reasons, an ideal ethanol-producing culture should possess the following characteristics: should not be inhibited by inhibitors produced during biomass pretreatment as well as its own metabolic byproducts such as acetic and lactic acids; should be able to utilize hexose and pentose sugars; and should be able to produce and tolerate a high concentration of ethanol. Production of byproducts such as acetic acid reduces ethanol yield and arrests cell growth and the fermentation process. A large number of studies are

being focused toward this direction with the aim of developing suitable microbial strains; however, only limited success has been achieved to date. The recombinant strains of yeast and bacteria that have been developed include Escherichia coli (KO11 and FBR5; Ingram et al. 1987) , Klebsiella oxytoca, Zymomonas mobilis, and S. cerevisiae (424A [LNF-ST], TMB3006, TMB3400). So far only recombinant S. cerevisiae strains have been able to produce ethanol from xylose contained in non-detoxified hydrolysates. Some of these S. cerevisiae strains have been used in fed-batch systems in combination with extremely inhibi­tory softwood hydrolysates (Hahn-Hagerdal et al. 2006). Details of some of the fermentation parameters that resulted from the use of these xylose-utilizing strains have been listed in Table 2.1.

Even though on many farms increasing the temperature of vast quantities of cold influent streams to thermophilic (55°C) levels may not be feasible, thermophilic anaerobic digestion has been important for energy recovery from Danish agricultural wastes (Ahring et al. 1992; Angelidaki and Ahring 1992, 1993, 1994; Hansen et al. 1999; Ahring et al. 2001t. The advantage of thermophilic anaerobic digestion lies in the superior kinetic rates at higher temperatures because of improved hydrolysis rates and methane yields (Vandevoorde and Verstraete 1987; Mackie and Bryant 1995; Sung and Santha 2003). Therefore, thermophilic digesters have been found to improve solids destruction over mesophilic digesters (35-37°C; Angelidaki and Ahring 1994; Sung and Santha 2003 t. Thermophilic digestion of animal wastes would also allow for sufficient pathogen destruction and the generation of biosolids that can easily be dispersed into the environment (Han and Dague 1997; Welper et al. 1997). However, protein-rich wastewater treatment at thermophilic conditions has shown to be problematic. Because of digestion of proteins into the end-product ammonia, higher levels of free ammonia at thermophilic compared with mesophilic temperatures (with similar total ammonia concentrations) have inhibited methanogenesis and caused unstable performances (Zeeman et al. 1985; Angelidaki and Ahring 1993; Lettinga 1995; Zitomer et al. 2005; Bocher et al. 2008). Acetate oxidation at thermophilic conditions may alleviate these unstable conditions somewhat because thermophilic hydrogenotrophic methanogens can tolerate higher levels of ammonia than mesophilic hydrogenotrophic methanogens (Hendriksen and Ahring 1991) and we already know that in general the hydrogenotrophic methanogens can tolerate ammonia better than acetoclastic methanogens (Sprott and Patel 1986). Despite possible acetate oxidation, ammonia inhibition at thermophilic conditions remains a real problem. In Denmark, mixing carbon-rich waste streams with protein-rich animal wastes to “dilute” the concentrations of the fermentation end-product ammonia has solved this problem. A report by Lindorfer et al. (2008) investigated the increase in operating temperature beyond mesophilic temperatures by self-heating anaerobic digesters fed with energy crops. They found that short temperature pulses and addition of acclimated biomass can circumvent negative effects of high free ammonia concentrations to digester performance during periods of increasing temperatures.