Thinking outside the box: ethanol production in the next millennium
Chapter 1
Thinking outside the box
Ethanol production in the next millennium: processors
of raw materials, not just ethanol producers
T.P. Lyons
Alltech Inc., Nicholasville, Kentucky, USA
Shifting perspectives on our industry
As our industry moves into the next millennium,
it – like all industries - must make changes. The
21st century will not be business as usual, but
rather business at the speed of light. Enterprises,
whether they be distilleries or not, must be
capable of responding quickly to avail themselves
of new opportunities, new challenges and new
technology.
Few industries are as conservative or as
protective as the distilling industry. This is
exemplified by the rules dictating that only whisky
produced in Scotland is Scotch, or that tequila
can only be produced in certain areas of Mexico.
Even our whole approach to sugar extraction
and fermentation is conservative.
Distillers cling to the age-old processes for
good reasons where marketing is concerned,
but for poor reasons where technology and
processes are concerned. Many plants run 5-
10% ethanol in the fermenter, yet yeast can
tolerate as high as 23% ethanol. Most distillers
consider alcohol to be their primary product
rather than one of a number of products. The
future, however, will be for companies who think
‘outside the box’ and who look to changing their
business perspectives. They are processors of
grain, not alcohol producers. They must focus
on increasing yeast’s performance in the
1
fermenter, so it can produce ethanol at its
maximum rate. Antinutritional factors such as
phytic acid and mycotoxins must be considered.
Just because a process was designed around
certain levels of backset does not mean that it
remains the best system.
Thinking outside the box also means using
spreadsheets to objectively measure effects of
change on productivity and profitability. ‘What
if?’ should be the by-word. Whether we are using
molasses or grain, new uses of so-called by-
products must be found. It is not sufficient to
simply sell distillers grains as a commodity, nor
to accept spent molasses as a waste needing to
be got rid of. The future is for those who find or
develop new markets for these materials. We
must think of ourselves as processors of grain,
sugar beets, cane, etc., not just alcohol producers.
The potential for ethanol
All of this requires education of operators,
marketers and management as to the possibilities.
All of this will require more and more research.
It is disheartening to note how little research is
currently underway in our industry. When one
considers the growth of the industry over the
last few years we cannot but be impressed
(Figure 1). In the United States, ethanol prod-
2 T.P. Lyons
uction has grown to over 1.6 billion gallons
annually. In 1998, nearly 10 billion bushels of
corn were harvested (>250 million metric tons).
Over 5%, or 500 million bushels were converted
into ethanol. This is about the same percentage
of the nation’s corn crop used to produce high
fructose syrups (Andreas, 1999).
When one considers that the oxygenate
MTBE (methyl tertiary butyl ether) is expected
to be either substantially reduced or eliminated
from gasoline, then our industry has an excellent
future. In the United States demand for finished
motor fuel is around 120 billion gallons annually
(Miller, personal communication). If MTBE is
removed, then there will be a 4% shortfall to be
replaced. Ethanol, with an octane of 113
compared to the octane booster MTBE of 109,
is one of the few ways that a gasoline producer
can achieve this high octane rating. Furthermore,
high octane gasoline always commands a higher
price at the pump.
Furthermore, the US Clean Air Act insists that
an average of 2% oxygen be present in
reformulated gasoline (RFG), which represents
about 30% of the US gasoline market. Pure
ethanol, contributing 35% oxygen, could clearly
provide this 2% oxygen if it were used at 5% of
the RFG. However if that were to happen,
ethanol production would not be 1.4 billion
gallons, but rather 3-4 billion gallons (Miller,
personal communication).
Nor is alcohol production limited to the US.
In 1998 some 31 billion liters of ethanol were
Figure 1. Fuel ethanol production in the US 1980-1998 (from Energy Information Administration and Renewable
Fuels Association).
produced and the vast majority were produced
by fermentation - 93% or 29 billion liters (7.8
billion US gallons). The major feedstocks used
to product this alcohol were sugar crops such
as cane and beet sugars, accounting for 60% of
the major ethanol producers, i.e. Brazil, and corn
in the US and Europe (Table 1). The total ethanol
capacity of Russia is estimated to be 2.5 billion
liters with beverage alcohol accounting for 60%
of this. Political changes are also ocurring that
will alter these figure dramatically. In Brazil the
highest production of ethanol was in 1997 when
output topped 16 billion liters. While a surplus
existed in 1998, the government has now
introduced ‘green fleets’ and blending of
anhydrous alcohol (5%) into diesel fuel to take
care of this. In Europe there has been much
discussion about Bio-Ethanol; but only recently
have there been tangible results. The long-term
goal is a 12% share for renewable fuels with
biofuels playing a major role. Despite
concessions, progress has been slow. France has
been leading the way. A French law dating back
to 1987 allows the blending of 3-15% organic
oxygenated compounds (3% for ethanol, 15%
for ethers such as ETBE). In November of 1996,
a draft bill on clean air makes use of oxygenated
components mandatory by 2000; and the
powerful French farm lobby are pushing for
ethanol to be included in gasoline at 2%. This
would require almost 0.5 billion liters. Seven self-
contained distilleries with a combined capacity
of 82 million liters/day and 16 integrated sugar
 Thinking outside the box: ethanol production in the next millennium 3

and alcohol complexes will be easily able to types of spirits (Figure 2). In the first step starch-
supply that amount. containing raw materials must be liquefied so that
dextrins and subsequently fermentable sugars
Table 1. Geographic distribution of the majority of can be obtained. Other raw materials such as
fermentation alcohol (fuel, industrial and potable).1 molasses and whey have sugars pre-formed or
Country Production their extraction may be taken care of in the
(billion liters) Raw material ‘cooking’ process such as agave. The sugar will
Brazil 14.0 Sugarcane, beets
in all cases be passed over to the workhorse of
United States 5.3 Cereal grains all distilleries – yeast. This microorganism, the
(mostly corn) world’s most heavily used microbe, converts
Europe 4.3 Cereal grains, beets sugars to ethanol and caron dioxide. The ethanol
Russia 2.5 Cereal grains, beets content, which can be as much as 23% but in
Total world practice is 10-13, is then concentrated. At this
production 28.0 point the chemical engineer takes over from the
1
Berg, 1999. biochemist as the beer moves toward distillation.
Even with the disillation some classification of
The future of ethanol is thus very positive and spirits can be made. The rums and malt whiskies
does not depend on subsidies. A 1997 study by from pot stills; gin, vodka, fuel and industrial
Dr. Michael Evans of the prestigious Kellogg alcohol from continuous stills.
School of Management at Northwestern Further classifications of the process occur
University concluded that the net effect of when we decide whether to mature the distilled
ethanol production was a reduction in the US product. As noted in the chapter on American
federal budget deficit (Table 2). This is brought whisky, bourbon must by law be aged for a
about by increased tax revenues due to increases minimum of one year in charred white oak
in personal income from wages and salaries, barrels. This opens up an opportunity for the
higher farm income, more corporate tax revenue Scots and the Irish, and indeed for the rum
and declining unemployment compensation manufacturers, who use barrels that once carried
payments. bourbon and use them for a further three years
to store and mature their own Irish whiskey, malt
Table 2. Impact of ethanol production on the US whisky, or Scotch grain whisky. The rum and
federal budget1. tequila manufacturers, unlike the Irish and Scotch
whisky producers, also age their product in
Revenue source Million US$ barrels, but not for such a long period. Rum is
Personal income taxes from wages commonly matured for 1-2 years; although many
and salaries 532 fine rums are aged for up to 12 years. While the
Personal income taxes, farm income 675 bulk of the tequila sold is not aged; regulations
Social security taxes 1608 defining aged tequilas call for Reposado to be
Decline in unemployment benefits 561 aged at least one month while Añejo must be
Corporate income taxes 846 aged for at least 12 months.
Less the ethanol tax incentive -648
Net savings to the federal budget $3,574
1
(adapted from Evans, 1999) Recovery of by-products

As we review our overall process, it is obviously

The alcohol production process critical that we maximize utilization of by-products.
In the production of spirits, assuming the
The alcohol process has a number of steps that feedstock is corn, the major cost factors are the
enable us to differentiate among the various raw material, energy, enzymes, processing
4 T.P. Lyons
Figure 2. Beverage alcohol feedstocks and products.
chemical cost (water treatment, etc.) and labor.
Much of these costs can be offset with 17 lbs of
distillers grains coming from each bushel of corn;
but we must maximize the return on this essential
product. At the time this book was printed,
distillers grains were selling for around $80/ton
while corn, at under $2 per bushel, is at an all
time low – as is distillers grain. At 4 cents per lb
($80/ton), this 17 lbs of DDGS gives us a credit
of 68 cents. This 68 cents is set against the $2
bushel of corn or the 3-4 cents for enzymes. If
on the other hand, new or novel products could
be made from distillers grains, (i.e. improved
bypass proteins for cattle, pre-hydrolyzed DDGS
for fiber use in human applicatoins), the financial
impact would be substantial. The future will see
many new products built around DDGS. This is
the subject of a separate chapter in this volume.
Therefore, as we move forward to improve
the value of distillers grains and derived products,
a continual emphasis on yield (while still very
important), would not be as critical. Perhaps in
the future distillers grains and other derived
products will, and indeed should, be the single
most important raw material from a distillery.
After all, they are rich and valuable proteins, a
commodity in very short supply across the world.
The chapters in this book we hope will help
you realize the complexity and at the same time
the simplicity of the process of converting sugars
to ethanol. If we make your search for
information just a little easier, we will have
 Thinking outside the box: ethanol production in the next millennium
achieved our objective. If we can encourage
more research, then we will be well-rewarded.
References
Andreas, M. 1999. A global perspective. In: The
1999 International Fuel Ethanol Workshop
and Trade Show. Cedar Rapids, Iowa, June
22-25.
5
Berg, C. 1999. World ethanol production and
trade to 2000 and beyond. World Ethanol
Report.
Evans, M.K. 1997. The economic impact of of
the demand for ethanol. Report to
Midwestern Governors Conference. Lom-
bard, IL, February. (cited by the Renewable
Fuels Association).
6 T.P. Lyons