USDA – Turns Vinegar Into Wine and Dollars Into Manure

I was asked to comment on Zeachem a company that turns wood into ethanol.  I have often blogged that the idea of cellulosic ethanol is a waste but I was particularly interested in Zeachem’s approach.  They convert the cellulose and hemicellulose in wood into vinegar (Acetic Acid) using a naturally occurring bug that is present in termites.  They also convert the lignin in the wood into hydrogen.  In a traditional chemical plant they react the acetic acid to form ethyl ester and then use the hydrogen from the lignin to produce ethanol from the ethyl ester.  Lots of chemistry steps to yield the biofuel

The US DOE is done with wasting billions so now it is the USDA’s (Dept of Agriculture) turn to blow our money.  Ag Secretary Vilsack was happy to provide almost a quarter of a billion dollars of loan guarantees to Zeachem for a facility in the port of Morrow in Boardman Oregon that will use locally grown poplar trees for the source of wood

OK so the USDA wants to turn vinegar into wine in a place called tomorrow.   For argument sake let’s dream that the bugs derived from termites can effectively turn cellulose into acetic acid (no bloody way they will).  Why not just stop at selling biovinegar.  Acetic Acid has a value of approximately $500 a ton.  Acetic acid is heavier and denser than ethanol and there are yield losses through the multiple processing steps to get the ethanol.  Also the gasification of the lignin to hydrogen is expensive and wasteful of energy. 

Let’s assume 0.75 pounds of ethanol result from one pound of acetic acid, therefore the cost of only the acetic acid is $666 per ton of ethanol.  Adding labor, maintenance, capital recovery, catalysts, and other costs will probably double this cost to around $1,400 a ton of ethanol.   Also the lignin could simply be burned as a fuel and this should be charged as a cost to the production of the ethanol rounding out the ethanol cost at approximately $1,500 a ton.  At $2.50 a gallon a ton of ethanol sells for approximately $750 a ton.  Wow make it for $1,500 sell it for $750!!  This is called Obamanomics.

So why in heavens name would a sane person convert the acetic acid they claim they make into ethanol they claim they make when the bio acetic acid is a more “profitable” and less risky business.   Of course the answer is that President Obama and Secretary Vilsack cannot dole out a quarter of a billion dollars for biovinegar when it is much more “palatable” to dole out the money for biofuel.    You see Oregon is known for its award winning wines not for its balsamic.

The folly of making vinegar into wine only can play out with free money from the government.  In rainy dreary Oregon the foresters are happy as the sun will come out in Morrow to grow the poplar trees.  Who said government money does not grow on trees.