SW Minn. plant to switch from ethanol production to isobutanol

A big change is ahead for at least one of Minnesota's 21 ethanol plants. A Colorado company plans to convert a facility in the southwestern part of the state to another type of alcohol production, one which makes isobutanol.

Gevo will be the first company in the nation to make the product from a renewable source. Its main advantage over ethanol is that it can be sold for more uses.

At the noisy ethanol plant in Luverne, long stretches of pipes and stainless steel tanks are part of an industrial process that ferments corn into alcohol. After corn flour drops into a slurry tank, it is mixed with water and enzyme.

But in a year this plant will look different. Some new buildings will go up as the company switches over to produce isobutanol, which the company hopes to begin making in about a year.

"When we talk about Luverne, we talk about being a world class chemical plant," Gevo vice president Jack Huttner said.

The company will use a patented yeast to ferment corn sugars into isobutanol instead of ethanol.

While ethanol is used only as a gasoline additive, isobutanol is a more flexible material, Huttner said.

He said Gevo will market it first to help make rubber, paints and other products. A few years down the road, he said, the company can also sell it as fuel.

Currently there's very little isobutanol made from renewable ingredients. Most of the butanol sold is refined from oil.

Huttner said Gevo's main selling point is that the price of its main ingredient, corn, tends to change less rapidly than the price of its competitor, oil.

"This allows big users of butenes to have an alternate source that is less price volatile," he said. "And that has a value in the market."

The more stable prices should help Gevo sell the product. Since its isobutanol price should change less often than the oil-based product, the company can offer buyers a guaranteed price for longer periods of time, Huttner said. Clients like that because it helps them figure the future cost of their operation more accurately.

Gevo has another economic advantage in that it saved a lot of money launching the operation. It bought the 13-year-old Luverne plant for about half the price it would cost to build a similar sized facility from scratch.

HARD TIMES FOR ETHANOL

That, in part, reflects the state of the ethanol industry.

Five years ago, ethanol turned in robust profits, enough to attract Wall Street investment banks. Today, profit margins are thin, and that makes it a good time to buy a plant, said Andrew Soare, an analyst for LUX Research, a renewable energy consulting and information company.

"Corn-based and traditional ethanol is a weak industry," Soare said. "And they are selling off assets, and ramping down production and idling plants."

Gevo may face the same sort of criticisms made of ethanol producers, largely that they waste corn, a food, by turning it into something inedible, Soare said. Other critics may say that the process uses too much water.

There could be other hurdles to clear as well.

Kansas State University chemical engineering professor Peter Pfromm is interested in whether Gevo can fulfill its claims when actual isobutanol production starts. He said the company makes about a million gallons of isobutanol a year at a test plant in Missouri, and scaling up the system to make 18 million gallons in Luverne could be a challenge.

That's because genetically modified organisms, like Gevo's patented yeast, sometimes don't perform as well as advertised.

"What happens with a genetically modified organism, is that they're less vigorous than a natural or a non-modified organism," Pfromm said.

Scientists don't know exactly why that is, he said. That means Gevo must keep its tanks and pipes as sterile as possible, so that no other bugs grow and interfere with the yeast.

Those are problems which have always plagued the industry. Back in the 1930's, U.S. companies also made butanol from corn.

The oil industry though could make the product cheaper, and it forced the renewables out of business. With its space age technology, Gevo feels it has a better chance of carving out room for the farm-based product in round two.

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