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Beyond corn ethanol: Minnesota's rural economy positioned for enormous gains

GROWING FUEL: Last of four articles

A shipment of corn arrives at the POET ethanol plant near Lake Crystal, Minn.
MinnPost photo by Jacob Valento
A shipment of corn arrives at the POET ethanol plant near Albert Lea, Minn.

Production of corn ethanol is rapidly expanding, but a "next generation" renewable fuel — ethanol made from grasses and "biomass" like wood and organics — is on the horizon. It's a potentially huge development for Minnesota's countryside that could continue an economic resurgence in rural areas fueled by ethanol.

Despite concerns about its effects, the corn ethanol industry is only hitting its stride. Energy legislation signed last month by President Bush mandates a doubling of ethanol made from corn, even though it already consumes 20 percent of the nation's corn crop and with the new law is estimated to rise to a third of the crop.

The energy law, passed with broad support in Congress, also mandates that by 2022 the United States produce 21 billion gallons of ethanol from grass cellulose and biomass from wood, animal waste and even garbage.

The ambitious goal is prompted by rising concerns about U.S. dependency on oil imports and the effects of burning oil whose carbon emissions are linked to climate change.

Meeting the non-corn ethanol goal is certain to induce still more rural economic growth that could surpass the explosive expansion of corn ethanol production in Minnesota and across the Great Plains.

Technology not ready
But questions loom over how much can be done and on what timetable.

Consider: it will have taken 30 years for U.S. corn ethanol production to attain the new goal of 15 billion gallons (with 7.2 billion gallons currently produced, it's about half there).

Corn has long been an established crop and distilling ethanol from it utilizes a centuries old liquor-making process. However, no cellulosic or biomass ethanol is currently being commercially produced. The technology to make it happen is years off, and cultivation processes to produce the grass feedstock is far from established.

Still, Congress has directed that non-corn ethanol production go from zero to 21 billion gallons in half the time it took the much simpler corn ethanol industry to mature.

"A lot of things have to go right within the space of only a few years," said Aaron Brady, an energy expert at Cambridge Energy Research Associates, an international energy consulting service headquartered in Massachusetts.

Minnesota is poised to gain enormously from "next generation" ethanol. The state has prairies where needed grasses can thrive, as they did before 30,000 square miles of sod was busted in the Great Plains to raise grain crops during pioneer settlement. Minnesota also has forests for wood biomass and a major urban center that generates copious organic wastes that now goes to landfills.

"We're in the bulls-eye of ethanol growth," said Don Arnosti, an agriculture and forestry expert with the Institute for Agriculture and Trade Policy of Minneapolis. Arnosti is a leader in a multi-pronged push by advocacy groups seeking legislative funding and policy support for alternative fuels.

Estimates vary on the value of a non-corn ethanol industry. However, economists generally peg a fully mature corn ethanol industry at about $7 billion annually with 25,000 jobs scattered across Minnesota's rural areas, helping reversing an economic decline that's been steady since World War II.

'Ready to fire'
A new ethanol industry likely would be valued at more than twice what corn ethanol has meant for the state's economy.

"We understand that the opportunities here are enormous," said Michael Bull, an assistant commissioner of the Minnesota Commerce Department and Gov. Tim Pawlenty's point person for energy policy.

State government is planning for "next generation" renewable fuels by supporting research and by working to amass a ready reserve of lands to grow prairie and other grasses. The state also is creating market pull for the fuel by becoming the nation's first to require refiners to blend gasoline with 20 percent ethanol (all that's needed is for the Environmental Protection Agency to designate E20 as a legal fuel, which is expected to happen).

"We're at the ready-aim point with renewable fuels," Bull said. "As it comes time we'll be ready to fire."

Unlike corn, native prairie grasses are low maintenance: they are perennials that obviate annual plowing, they require little added water and no chemical fertilizers, and they'll grow most anywhere on the prairie.

University of Minnesota ecologist Clarence Lehman says prairie grasses also provide quality habitat for varied wildlife populations that have suffered historical declines as the prairie was plowed and millions of wetland acres drained. Plus, the energy gain with cellulosic ethanol is more than eight times that of corn ethanol.

Lehman is part of a team of university researchers led by David Tillman who are conducting landmark studies on the value of prairie grass in ethanol production. Tillman, Lehman and Jason Hill published an article in Science last December that provoked worldwide discussion on grasses as an alternative to corn ethanol and helped generate public and political support for grasses as a fuel source.

But there are challenges:

· Breaking down complex polymers in cellulose to simple sugars for fermentation requires commercially affordable enzymes or a thermal-chemical process, and breakthroughs are at least three years away.

· For native grasses to again flourish on the prairie, seeds specific to each area need to be grown in large incubator plots. It could take a decade or more for sufficient seed stock to potentially plant up to 3,000 square miles of prairie grasses.

· Processing plants would have to be built or converted to distill cellulosic grasses or biomass, and that would be expensive.

· Farmers would need financial incentives to switch from high-profit corn to grass crops that take up to three years to mature.

"It will cost a lot of money, on a scale of the investment that was made for corn ethanol," said state Rep. Al Juhnke, DFL-Willmar, who chairs the House Agriculture Committee that this year may consider legislation that would pump $46 million into a plan to acquire prairie land to grow cellulosic grasses.

Ethanol production in general is enabled by billions of dollars in public subsidies. And for the nascent industry to flourish, government must require reluctant refiners to add ethanol to gasoline and require automakers to produce "flex fuel" engines capable of burning higher and higher ethanol blends.

Ethanol advocates point to Brazil as a country that has reduced oil dependency through ethanol.

Brazil's sugar cane-based ethanol has reduced the country's oil imports from 80 percent during the 1973 oil embargo to zero. All cars now sold in Brazil are "flex fuel" to burn any combination of gas and ethanol.

While corn ethanol is currently the renewable fuel of choice in the United States, it's encountered a chorus of concern about using a food staple for fuel, the negative environmental effects of growing all that corn, and the vast quantities of water used to process corn ethanol. (Combined, Minnesota ethanol plants annually consume as much water as the annual residential needs for 80,000 people.)

Industry changes
Responding to those concerns, there's stepped-up innovation in the industry to help drive down ethanol production costs and prepare for "next-generation" fuels.

For example, Central Minnesota Ethanol in Little Falls, Minn., tempers its need for natural gas by making fuel from wood-waste biomass; steam from the plant's distillery spins generators to offset a third of the plant's electricity.

Central Minnesota General Manager Kerry Nixon said he's next looking to produce ethanol from wood, which would vastly lower his plant's water requirements because the process utilizes the water in wood. Together, the innovations would increase energy output efficiency by using by-products to further replace natural gas.

At POET Biorefining's Glenville East plant near Albert Lea, Minn., ground soon will be broken for a 65-million gallon plant next to the 42-million plant currently operating there.

Plant manager Rick Mummert said the new facility is designed to switch to processing cellulosic or biomass ethanol as the technology becomes viable. Meantime, his staff is seeking to reduce water use through closed-loop recycling that recovers rather than discharges water and runs it back through the cooling system.

Mummert is also seeking to expand production of "co-products" such as nutrient-rich livestock feed, and even capture carbon dioxide that gurgles up in fermentation and sell it to the soft drink industry.

"Only a third of a corn kernel goes into ethanol production and the rest goes into other products, mostly livestock feed," Mummert said.

But a major question remains over how fast the ethanol industry can be shaped to meet the ambitions federal goal of producing 36 billion gallons by 2022.

"Obviously, there's a worldwide scramble to develop the technology to make this happen," Arnosti said.

Ron Way, a former reporter for several Midwest newspapers, covers the environment and energy issues. He can be reached at rway [at] minnpost [dot] com.

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Comments (5)


"Next generation" ethanol could be a major player in the alternative fuel race. While President Bush has single handedly thrown the corn industry the proverbial bone, ecologists are still displeased with ethanol, especially in terms of green house emissions, as it produces carbon dioxide the main culprit in global warming. Some suggest that the green house emissions are offset by the fact that corn absorbs carbon dioxide. I can't help but wonder how next generation ethanol will affect global warming. One huge positive that your article pointed out is that energy produced from next generation ethanol (ie.cellulosic ethanol) is more than 8 times that of corn ethanol. The lack of energy produced by corn ethanol has always been one of the big worries. It'll be interesting to see how this all goes down as the present republican administration seems set on making huge strides in corn ethanol production.

If you are at all interested in Corn Ethanol, you may want to check out a recent feature done at The feature is composed of insightful articles from around the blog-o-sphere.


The Issue |

The December 6th edition of The Economist contained a great article on the worldwide rise in food prices, and touched upon a number of the issues addressed in this wonderful series of articles here at Minnpost. I've included a link to the article in the economist.

The most statistic I found most telling: "According to the World Bank, the grain needed to fill up an SUV would feed a person for a year".

I learned more from this article and this series than I have from almost any other series on biofuels.
The first point is the "vaporware" aspect. As this part pointed out the technology for "fiber to hooch" is still at least three years off. I've read twenty year old articles that predicted the same time for a breakthrough. What exactly are the problems?

Logically, a processing/distillation plant should be built adjacent to large power plants since the distillation requires only a low level of heat. Also, the process can be delayed so more of the power plant's energy can be devoted to electricity during peak demaand periods. Also the big electric plants have good rail (and often barge) access so the grain can be shipped in by rail and the "mash feed" can be shipped out. (my father ran an electrical power plant so I understand all this).

This segment said "Only a third of a corn kernel goes into ethanol production and the rest goes into other products, mostly livestock feed," Mummert said.".

I recall maybe twenty years ago Jack Daniels whiskey was in court with farmers because demand for the hooch had declined, production declined, and there was less "mash" to sell to farmers.

As I understand it, the fermentation involves yeast using the sucrose or sugars to grow and multiply and alchohol is essentially a waste product to the yeast. The yeast is essentially a fungii or simple plant. The yeast is supposed to have high concentration of very high quality protein so it's very desireable as animal feed.

To make a crude comparison I buy only "skim" or "fat free" milk. They remove the butterfat but tend to add some dry milk solids so it has more protien, probably per gallon, than whole milk and defintiely a lot more protien per calorie. What is missing are the "fat" or "empty" calories.

Looks the same for the ethanol mash. It is supposed to be protein rich. In feeding Bessy, Porky, Tom Turkey or Mother Hen soybeans are typically used to enhance the protien in the food ration. It looks like the cooked/distilled yeast makes an excellent protien.

The point here is that if 20% of corn is used to make alchohol and two-thirds of this goes back as high protien feed then this feed will displace mostly corn and osybeans that would otherwise be used for this feed. If so the true "consumption" of corn by gasahol would be reduced by two-thirds. This would make the true consumption around 7% of crop. To use another crude analogy. let's say I replaced sugar coated corn flakes with corn flakes with no added sugar. That's essentially what the post distilation mash is.

The earlier ethanol development was hindered by low crude oil prices between 1990 and 2003. Money is extremely relavent here. On January 01, 2008 Crude Oil at least symbolically hit $100 a barrel. I tell people that if they are considering buying a new car figure gas at a minimum of $4 per gallon and "do the math". I base this mostly on the "Developing Countries" "developing". They will want cars and other "goodies" as they gain affluence.

There are a lot of factors at work but but I don't forsee crude oil under $75 per barrel if any significant time. I read a figures that the energy equivalent of hay was $15 per barrel of oil. This may be outdated but you get the idea. This give a great monetary incentive to develop a "fiber to hooch" technology. Comrades! the profit incentive is important!

The original Prarie grass might be "politically correct" but it appears any fiber will do in the short run. As for "flex fuels, I've read that in a typeical new vehicle the added cost of flex fuel is $100 and going down. Yeah! that seems like a good "hedge". Locally you might notice the Post Office is replacing the "boxmobiles" with Chev mid sized SUV's. These are "flex fuel". If you look carefully on the back you can see this.

Our Governor Palenty has proposed replacing midrange gasoline, which is only 6% of sales with E85. This is doable with a series of "nag screens" to stop people from inappropriately using E-85. Most people buy gas with credit cards. The credit cards could "learn" the vehicles. This is useful if you also have a non E85 vehicle.

You could use the same vehicle ID used for the "lexus/sane lane" billing to register your E85 vehicle so you don't get more than a one step nag when refueling from a multi-grade pump. This is relatively inexpensive equiptment to install. If you get in a bind you ca always work through the "nag screens" or buy regular gas.

if the "fiber to hooch" technology does develop it will be a huge. What is needed is more honest discussion of this. Most "greenies" don't understand the technological obstacles and fall for "vaporware" energy solutions. This does not help in the long run.

One thing that having more flex-fuel vehicles would do is demonstrate how bad E85 really is. As an owner of a flex-fuel vehicle I can testify that the reduced energy output of ethanol is real, and dramatic. I filled up on E85 at station in Iowa will on a trip a year or two ago, and was shocked at how bad the stuff really is. Virtually no power going up slight grades, the cruise control could not come close to maintaining speed on these grades.. [I am sure you are familiar with the steep grades of Iowa and Southern MN on I-35, or lack there of. Fuel economy was markedly lower, compared to the difference in price, especially considering I am paying for the subsidy for it too.

So in a short sentence.. Tried it once, never again.


As long as the RFS is not lowered like the EPA want's to do. This would have a detrimental effect on the MN economy and is not based on any scientific facts. Lowering it is simply wrong and is likely based on pressure from big oil. The ethanol detractors like to quote facts about ethanol's efficiency from 30 years ago and make a lot of stuff up.