Editorial Note: A very interesting development. POET-DSM Advanced Biofuels, LLC, a joint venture of Royal DSM and POET, LLC, opened its first commercial cellulosic ethanol plant in Emmetsburg, Iowa on Sept. 3. While still relying on subsidies and RFS support it does cross a threshold. With the RFS specifically, it implies moving beyond E10, which has not seen any significant traction in Washington. The total economics require a further look. Below is the company announcement. (Photo Source: POET-DSM Media Photo Archive)

POET-DSM Advanced Biofuels, LLC, a joint venture of Royal DSM and POET, LLC, today proved its revolutionary technology that converts agricultural residue into renewable fuel at the Grand Opening of its first commercial cellulosic ethanol plant in Emmetsburg, Iowa.

The plant, named “Project LIBERTY,” was formally opened in the presence of His Majesty Willem-Alexander, King of the Netherlands, U.S. Secretary of Agriculture Tom Vilsack, Deputy Under Secretary Michael Knotek of the Department of Energy, Governor Terry Branstad and Lieutenant Governor Kim Reynolds of Iowa, other dignitaries and thousands of guests.

Project LIBERTY converts baled corn cobs, leaves, husk and stalk into renewable fuel. The plant has now officially started up, processing its first batch of biomass into cellulosic ethanol and is moving forward toward continuous operation. At full capacity, it will convert 770 tons of biomass per day to produce ethanol at a rate of 20 million gallons per year, later ramping up to 25 million gallons per year.
“Some have called cellulosic ethanol a ‘fantasy fuel,’ but today it becomes a reality,” said Jeff Broin, POET Founder and Executive Chairman. “With access now to new sources for energy, Project LIBERTY can be the first step in transforming our economy, our environment and our national security.”

Feike Sijbesma, Chief Executive Officer and Chairman of the Managing Board of Royal DSM said: “This is an historical day in the development of plant-residue-based cellulosic ethanol as a viable, commercially attractive alternative to gasoline as we are moving from the fossil-age to the (bio-)renewable-age. For DSM this is a strategic investment, applying our proprietary technology to convert agricultural residue on a commercial scale, allowing it to be replicated at other facilities globally as we are ramping up our cellulosic ethanol licensing business.”

This first commercial-scale cellulosic ethanol facility marks a huge step forward in the wider adoption of biofuels, both in North America and elsewhere. It is also a victory for the Renewable Fuel Standard, which prompted increased investment into advanced biofuels that accelerated development of this new technology. The RFS is a critical tool in moving the U.S. beyond 10% ethanol use to allow this new technology to expand to other parts of the country.

Meanwhile, in other parts of the world the development of cellulosic ethanol is expected to be boosted as POET-DSM’s LIBERTY process and technology to effectively convert agricultural residue using a proprietary cocktail of enzymes and yeast becomes available via licensing.

The Departments of Energy and Agriculture and the State of Iowa have been important partners in bringing this technology to commercial scale. The DOE has awarded $100 million in grants to support the costs of engineering and construction, as well as biomass collection and infrastructure. The State of Iowa has taken a lead role in helping make Project LIBERTY a reality by contributing $20 million in grants for capital costs and feedstock logistics. USDA invested $2.6 million to support the delivery of more than 58,000 dry tons of corn crop residue, helping establish the feedstock logistics network.

Assuming continued support from the RFS program and depending on the adoption rate of cellulosic ethanol both in and outside the United States, POET-DSM Advanced Biofuels LLC has the potential to achieve net sales of about $250 million from bio-ethanol and license income by 2020 with EBITDA margins clearly above average.