A lesser-known pilot project in Mexico says it can produce biofuels at parity with $33 oil. Can this ultra-low cost project replicate its results at scale. Where is it deploying, and when?

Despite all the (laudable) excitement over the race for low-cost cellulosic sugars, industry insiders continue to whisper “syngas” when asked to name a platform that they think has strong upside potential for biofuels and renewable materials.

As any good cook knows, one way to alter biomass is to leave it out, and let microorganisms take it where they will – usually to something inedible – but the other way, and quicker, is to cook it. And the fastest way of all is to toss it into the microwave, with a casual “nuke it, baby.”

Cooking it up? Broadly speaking, that’s the route for fast pyrolysis and gasification strategies as a group, although this isn’t exactly Mom’s oven – temperatures can reach 20,000 degree in some technologies, and as a general rule a near-vacuum is involved.

With gasification technologies, the product is syngas – a not-too-friendly world of superheated hydrogen and carbon monoxide molecules. As they cool, fermenting microorganisms can ferment the gas as it liquefies, or the gas can be catalytically converted to a series of target fuels, chemicals or other products.

It’s a fast-acting technology – converting biomass in seconds to the requisite materials, and its the most feedstock-flexible process that we know. So why hasn’t it been the unchallenged Dominator of the biofuels landscape. In a word, economics – generally, the cost of energy inputs, or the lack of sufficient hydrogen output, among other pitfalls that has plagued the technology’s history.

Gasification and pyrolysis, as we have reported, are fast-changing technology platforms, and in recent years companies like ClearFuels, Rentech, LanzaTech, Coskata, ZeaChem, KiOR and INEOS Bio, among others, have been redefining the potential.

Plasma2Energy

But one of the most remarkable, if early-stage, set of data we have come across, hails from the little-known Plasma2Energy cellulose-to-energy system. A pilot project had operated for three years in a 10 ton per day trial down in Monterrey, Mexico and is now expected to head north shortly for commercialization in the US.

From corn stover, the team is projecting a yield of 145 gallons of ethanol, and 20 gallons of diesel, per ton of biomass. That’s remarkable – a lift of more than 30 percent over most conventional cellulosic ethanol yields (in total BTUs), and more than 10 percent ahead of the best-of-breed the Digest has yet tracked.

More interestingly, the company is able to work with post-sorted municipal solid waste (after the metals, silicates, soil, cements and concrete are removed), and is in finalizing a letter of intent with the city of McAllen in Texas to build the first U.S. plant. It is expected to be finalized before the end of September, for a project that will handle up to 500 tons per day of their MSW.

With waste, of course, comes the potential of extremely low-cost, or even zero or negative-cost feedstock. Some projects have been talking about goals to reach far below the standard parity with $80 oil that is generally table stakes these days in taking biofuels to scale.

Parity with $33 oil?

Plasma2Energy is projecting out that they will be producing at parity with $33 oil. As technologies that produce, primarily, ethanol – that’s down in the range that Joule Unlimited is seeing in its pilot. KiOR has been hitting some strikingly low numbers, too, and companies like Coskata and Qteros have been looking at the sub-$50 oil range too.

But not too many in the low 30s.

Let’s be cautionary about it – after all, Plasma2Energy is running a 10-ton per day pilot and is reporting data that has not been verified by an independent third-party. That’s 1/50th of the scale under discussion with the afore-mentioned Texas muni. So let’s keep this in perspective, even if the numbers are quite remarkable.

The technology? As the name suggests, its a gasification technology, one of a wave of interesting pyrolysis and gasification systems that have come forth in recent years with attractive economics and tolerance for a wide range of feedstocks. Unlike systems from Coskata, LanzaTech or INEOS Bio, however – and more conceptually like Enerkem, the system uses a catalyst, rather than fermentation, to convert syngas to targeted fuels.

The kicker: microwaves. To be specific, using microwave-induced plasma gasification.

“The main difference,” explains CEO Rodolpho Sanchez, “is that we microwaves to release and separate the and then react with H20 to create carbon monoxide and hydrogen. We don’t have to create a plasma and then gasification – and go directly to gasification through a fluid bed reactor, and no electric arc.”

And, a nice output of hydrogen – as much as 50-52 percent, which is a critical factor in making hydrocarbon fuels.

You can view a demo of the Plasma2Energy process here.

The system was initially examined for producing electricity from biomass, with yields of up to 2.2 MW per ton of biomass, compared to 0.8 to 0.9 MW per ton with conventional biomass power systems.

“We are exploring liquid fuels and more attractive uses of the gas in the syngas,” says Sanchez.”

Like many biomass gasification technologies, its a modular system with the basic full;-scale unit handling up to 300 tons of biomass per day (there are 10-150 ton smaller modules available). The 300 tons per day plant produces 15 million gallons of ethanol and 2 million gallons of diesel fuel, and costs $10.5 million to operate per year (inclusive of capital expenditure, amortized over 20 years). Hence the $32.60 per barrel of oil equivalent cost.

Where are they in scale-up?

Plasma2Energy is talking to project developers for waste to energy, and private investors both US and Mexico. It takes 12 months to start running, 6-8 months to build the TRU and the rest of time on feedstock prep. The offer to McAllen, TX 18 months and they plan to execute in 12 moths. The proposed McAllen contract? 15 year to 25 years and including tipping fees and other economic development incentives.

Bottom line

We’ve seen some remarkably low cost, high yield and fast-build systems coming out of the gasification side of the sector – the thermo-chemical crowd (or the Pyromaniax, as we have dubbed them from time to time).

For sure, this is the lowest cost system that we have so far seen. We will be keeping a very close eye on this to see if McAllen, TX closes the deal, and then to see if the numbers from the pilot hold up at scale.

If so, a real breakthrough on cost and yield, enough to call it a game-changer and a steep challenge for the fermentation-path technologies.