Iowa Public Television


First Closed-Loop Ethanol Plant Opens

posted on July 27, 2007

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This week, one of the country's largest ethanol producers, VeraSun Energy, announced plans to acquire three ethanol plants. The plants, not yet online, will add about 330 million gallons of production capacity to the South Dakota-based company. With the company's other plants under construction plus its current production of 340 million gallons a year ... the acquisitions will bring the company closer to its goal of producing one billion gallons of ethanol annually by 2009.

Such investment by a single company – and the continual building of ethanol plants by other investors -- would seem to sideline concerns about profit margins being battered by the high price of corn. At the same time, commodity prices may just spur innovation – to make new plants more efficient or get more than just fuel from the operation.

A case in point, as producer David Miller reports, is a company that produces ethanol, and basically uses "everything but the squeal."


Dedicating an ethanol plant in the Midwest has become commonplace. Feeding wet distillers grains, or DG's, to cattle is not a new idea. Capturing the biogas from cattle manure as a power source has been done for years. But in eastern Nebraska, E3 BioFuels has been able to combine all three elements in a closed-loop.

According to Dennis Langley, E3's CEO, this is the only operating ethanol facility of its type anywhere in the world.

Dennis Langley, CEO, E3 BioFuels: "each concept was a very tried and true concept. It was simply linking them together so that you basically took the advantages and solved the disadvantages of each one. And so by putting them together and, you know, everybody comes along and figures out hey, why don't you do this or that and there's always got to be a first."

Langley, a former gas pipeline engineer and energy infrastructure owner, spent 10 years researching ideas to bring the three technologies together.

One of the keys to getting started was finding a ready source of manure for biogas production. With cattle being one of the best sources, the search was on for a feedlot. The most important factor in selecting the feedlot was finding manure that was uncontaminated by sand or soil. Langley's team located what they were looking for in Mead, Nebraska. Operating since 1969, the Mead Cattle Company had the one thing that would keep the manure clean-- slatted floors and a pit recovery system.

After an agreement was made with the Mead Cattle Company, construction on E3 BioFuels' Genesis plant began in 2005. Langley eventually purchased the feedlot in 2006.

Dennis Langley, CEO, E3 BioFuels: "I got some private banking financing and had to use my own personal financing initially. At this point now it's quite easy to attract capital once you've got the first one up and running and said look at it, here it is, it works and you get past that first stage."

Ultimately, $80 million was invested and the first ethanol began flowing in April of 2007. The operation now employs 90 people from the surrounding area.

Part of Langley's plan was to create a facility that was both economical to operate and environmentally friendly. The close proximity of each part of the production chain helps minimize expenses and allows for the most complete use of each co-product.

Currently, the Genesis plant is in the process of ramping up production. When the ethanol plant is operating at full capacity, E3 will purchase 20,000 bushels of corn per week and make approximately 25 million gallons of ethanol annually.

The wet distiller's grains from the ethanol fermentation process are trucked across the road, combined with some additional corn, and fed to the nearly 30,000 head of cattle in the feedlot. The short distance the DGs travel greatly reduces the freight charges for feed.

Manure from the feedlot, which will total approximately 300,000 tons every year, is pumped to the biogas digester. The slurry is combined with thin-stillage, a co-product of the ethanol process. This mixture spends about 15 days in two 4 million gallon storage tanks making biogas for the company's two boilers.

The steam created by the boilers is used in the ethanol plant as well as E3's nutrient recovery facility where the manure is further processed for co-products and the cycle begins again.

A two-step procedure separates the liquids from the solids. In the future, E3 hopes to sell the solids as fertilizer to either area farmers or garden centers. The remaining liquid is heated with steam from the biogas powered boilers to remove aqueous ammonia. This co-product is already being sold on contract.

And E3's engineers are studying the cost effectiveness of recovering the C02 from the fermentation process for food-grade applications but have yet to find an interested customer.

Water, one of the resources employed throughout the facility, is re-used as many times as possible. When it can no longer be used, the grey-water is held in two 55 million gallon rubber lined lagoons. From here, the water is then used for irrigation of crops grown on the 2200 acres surrounding facility.

Langley claims the patented closed-loop process can produce 46 units of energy for every single unit of energy used. According to USDA, a typical corn-based ethanol plant creates approximately 2.25 units of energy for every unit utilized. Though the actual cost of a gallon of ethanol at the Genesis plant is confidential, Langley says even with corn selling above $3 a bushel and ethanol trading near $2 a gallon the Genesis plant is a "low-cost provider."

Near the end of June, after several delays, the day finally arrived when the Genesis plant was officially dedicated.

Dennis Langley, CEO, E3 BioFuels: "For rural and small town America we watch 200 years of constant decay of populations and jobs. The studies tell us that most want to live in small town and rural America but live in urban America because they can't get good paying jobs in their mind. This is a reversal of that trend and a great look forward for America."

Various dignitaries were in attendance including the governor of Nebraska.

Governor Dave Heineman, R-Nebraska: "This is the kind of the innovation we need to continue to move the ethanol industry forward. Nebraska and Iowa particularly, our two states, have led the way when it comes to ethanol production. ...But from day one we thought this was a wave of the future and, again, we're excited about this ethanol industry in our state."

And Langley is not resting on his recent success. The reason the first plant was dubbed "Genesis" has to do with his plan to build 15 more closed-loop facilities just like this one across the Midwest.

Dennis Langley, CEO, E3 BioFuels: "...when we came across this type of an approach and figured out how to put these together it solved what I would consider the traditional criticisms and in my mind I view it as the second generation of ethanol and I am in no way critical of the first generation because but for the first generation there could have never been a second generation, we stand on their shoulders and we're proud to do that."

For Market to Market, I'm David Miller.


Tags: agriculture alternative energy biofuels ethanol Iowa manure news renewable fuels science technology