By Katrina Cornish & Corinne Young
This is the sixth in a series of articles prepared by the experts at Lee Enterprises Consulting (LEC) who will be speaking at the ABLC 2018 conference in Washington DC, February 28 to March 2.
Challenges and solutions to scale up of unconventional but viable bioeconomy feedstocks
Bioenergy/biofuel/platform chemical biomasses, whether grown (crops) or collected (forestry waste and municipal wastes of various kinds), still struggle with commercial competitiveness against the low cost, enormous scale, and market barriers presented by mature fossil fuels juggernauts. The answer is obvious and clear – we need industrial crops that can produce diverse products, and support smart scale-up and deployment with high margin, low volume, chemicals and materials, that can cross into the subsidized larger volume-commodity products such as fuels. We need to be real, and learn from the hard knock lessons of the last decade.
So, where to start to compete with petroleum? How about with Natural Rubber crops? The History Channel, Modern Marvels series, deemed rubber the world’s fourth most important natural resource after air, water and petroleum.
In a free market economy, market pull is fundamental. The new “product” must be wanted by commercial enterprise. However, this is determined by price and product features. Is the new source more expensive? Does its utilization require retooling? What processing capacity is required? Can it be incorporated into an existing portfolio or manufacturing system? Most importantly, can it be scaled up using profits and profit secured bank loans?
The bottom line is to make the bioenergy/biofuel cost-competitive. So far the DOE goal of $3/gallon gasoline equivalents, or below, for biofuel has proven unattainable, even from waste feedstocks. Attempts using white biotechnology still face enormous technical and financial bottlenecks for competitive economics. Anaerobic digesters for biogas production from waste have the advantage of employing local feedstocks and serving local markets, yet are limited to locations with adequate concentration of feedstocks and will remain small scale pending leapfrog innovations. Lignocellulosic conversion faces a potentially insurmountable logistics challenge when focused solely on single use feedstocks. US corn and soy are mature industrial crops, can be highly densified and transported across long distances by rail at relatively low cost, to produce diverse products, from specialty high value/low volume, to commodity low value fuels. This is great, the model, right? Until incumbents squash them with Food v. Fuel, restricting the most logical, existing, US industrial BioEconomy crops.
So how can these conundrums be addressed and resolved so that sustainable production, business profitability, and current and/or improved standards of living are combined? What are the key obstacles – technical and business – and how can they be overcome in a business and bioeconomy setting?
A high value primary product is essential to the non-subsidized commercial viability of bioenergy/fuel/platform chemicals from bio-feedstocks. Pharmaceuticals, specialty chemicals and bioactives are generally small market niches that can seed scale-up to larger chemical markets and eventually to the associated economies of scale for transportation fuels. The balance of increasing scale with decreasing cost of goods must be maintained during scale up – and a single step from premium niche to commodity is not possible.
Alternative rubber crops present a viable opportunity, because they can progress from addressing un-met needs, through premium existing markets, mid-range and finally to commodity latex and rubber products. Also, the rubber commodity market is a well-known example of an existing commercially viable balance between biobased and fossil feedstock derived synthetic versions, and premium niche to low cost commodity applications. Rubber is an essential material, and natural rubber (NR) is a critical agricultural material. As petroleum prices fluctuate so do rubber prices and the percentage of the two forms can swing several percentage points in response. The relatively recent involvement of futures traders in rubber markets has led to unacceptable price volatility in both synthetic and natural rubber markets. Many recognize the need for domestic sources of natural rubber to stabilize global prices and protect US supply requirements. This is now imperative because of burgeoning global shortfalls. The United States imports ~1.4 million tonnes NR per year, for its manufacturing industries, as well as vast quantities of NR-containing finished goods, so any shortfalls are disturbing. Rubber shortfalls put the US, and other importing countries, at serious risk of high prices and even unavailability of this critical, agricultural, raw material.
There is currently no significant source of NR in the US although both guayule (Parthenium argentatum) for the semi-arid southwest and rubber dandelion (Taraxacum kok-saghyz) for the northern states are under development. While both have attracted considerable industrial support from global tire companies, their co-development as energy crops is in its infancy.
The challenges faced by natural rubber and their potential solutions provide a telling example of how biofuel production and scale-up can actually be addressed. Both alternate sources of rubber have been proven suitable for tires. Bridgestone Tire & Rubber Company operates a guayule pilot plant in Mesa AZ, and a small research farm (~100 Ha) in Eloy, AZ. EnergyEne’s proprietary breakthroughs allow guayule latex to be targeted to premium latex niche markets and unmet needs with high margin returns. Rubber dandelion development is supported by an academic industrial consortium led by the Ohio State University (with University of Nebraska, Oregon State University, Goodyear, Cooper and Ford), as well as the USDA-ARS.
Rubber dandelion NR is very similar to hevea NR in composition, macromolecular structure and properties and so is almost a drop-in material for existing manufacturing processes. Also, this crop be grown in a wide range of temperate environments. Its adaptability to an annual crop production system means that it can be incorporated into existing crop rotations, including with corn and soybean, with minimal impact on food production, and can rapidly adjust to changing market demands. Water-based extraction is used for this species, and the inulin and lignocellulose co-components of rubber dandelion roots can be readily converted to biofuels to address US advanced biofuel targets. Guayule, however, is a perennial semi-arid region shrub, which can be harvested multiple times and is suited to the southwestern US. This crop processes to rubber and latex, terpene resin and hard wood bagasse.
Grown on the scale needed to simply displace all imported natural rubber, rubber dandelion would co-produce over 1.25 billion gallons of sugar-based biofuel. Guayule, on a similar scale, using a combination of water extracted latex (EnergyEne process, not Bridgestone’s solvent extraction, which produces a much lower energy content bagasse) and pyrolysis (Piedmont Bioproducts process) would produce, annually, 2.25 billion gallons bio-oil (~420 TJ), 2 million tonnes of biochar, and 16 PJ of syngas. Thus, nearly 10% and 18% of the advanced biofuel required by the US biofuel mandate would be coproduced by rubber dandelion and guayule, respectively. The US can easily support 10x the acreage required for self-sustainability, thus meeting the mandate, without competing with food crops (although some free range beef production would likely be affected).
However, the problem of scale-up persists. If these crops, and associated processing infrastructure, were expanded to rubber self-sustainability scale without concomitant profits along the way to fund expansion, it would cost more than the US gross domestic product! Also, tires are large scale commodity products so even one line of tires requires large acreage, and multiple rounds of product testing are required over several years before new tires can be introduced to the market.
So how to get there?
High value niche markets are needed for initial small scale production and subsequent expansion of both alternate crops. Rubber dandelion NR does not appear to have unique property features, so small scale production requires manufacturers of premium products (such as sporting goods) to be willing to slightly increase retail prices to protect their margins, support a significantly higher raw material cost and market the “domestic” and “dandelion” features. Specialty sporting goods and fashion items suit this approach.
In contrast to rubber dandelion and hevea NR, guayule NR and latex have distinctly different properties. These allow development of new materials and products addressing unmet needs, and/or conferring competitive advantages to manufacturers, uniquely providing high margins. For example, a remarkably high polymer-filler interaction allows guayule NR to contain more filler than other elastomers. The guayule natural latex radiation attenuation medical glove, the first such natural medical glove, combines non-allergenic, high attenuating filler content and premium mechanical properties, and has a >3,000% profit margin. Unique guayule rubber cryomalleability can address other unmet needs in aerospace. These types of products, high margin and low volume, will allow commercial latex production on a pilot scale, generating sufficient profit to then scale to larger acreages and processing facilities allowing steady decreasing cost of goods and lower value products. Guayule biosynthesizes even more terpene resin than rubber, with interesting bioactives, which could be separately extracted and, on a large scale, used to make a diesel-type fuel. In contrast, solvent extracted rubber (Bridgestone, Panaridus) coproduces a tar-like resin (useful in asphalt) and lignocellulosic bagasse (similar to other hardwoods). Similar to rubber dandelion, residual guayule bagasse can also be hydrolyzed and the sugars used to produce fuels.
In conclusion, domestic production of alternative NR would allow the US to both become self-reliant and, potentially, a NR exporter. Although much larger amounts of fuel are imported than rubber, these could partially be displaced by biofuels produced as coproducts of alternate rubber producing crops. The product range of NR allows rubber crops to be profitable on a small scale and fund expansion to a scale appropriate for energy production.
About the Authors: Dr. Katrina Cornish and Corinne Young are both members of Lee Enterprises Consulting, the world’s premier bioeconomy consulting group, with more than 100 consultants and experts worldwide who collaborate on interdisciplinary projects, including the types discussed in this article. Dr. Cornish is the FAAAS Endowed Chair and Ohio Research Scholar, Bioemergent Materials, The Ohio State University and the CEO, EnergyEne Inc.. Corinne Young is theSpecial Advisor to EnergyEne & the CEO Corinne Young LLC. The opinions expressed herein are those of the authors, and do not necessarily express the views of Lee Enterprises Consulting. Katrina and Corinne will both be guest speakers at the ABLC 2018 Conference commencing on February 28, 2018.