A coal powered ethanol plant and a test of the new RFS


In a little town in central Pennsylvania, a company called Sunnyside Ethanol, LLC (owned by Consus Ethanol, LLC) wants to build an 80 million gallon per year corn ethanol refinery that would get its heat and power from a waste coal boiler. The project would stand about 150 yards from the town's high school and a stone's throw from half a dozen houses. Waste coal, in case you don't know, is the stuff that's not good enough to burn in a regular coal plant. Needless to say, it's pretty nasty stuff.

This local news TV clip gives some good basics and introduces Pamela Sheeder, a local mother and leader of Citizens for a Clean Curwensville. (If you watch the video, take note that while the project has an air permit, it hasn't started construction. Also, what do you want to bet the borough council president doesn't have children at the high school.) These two articles introduce the only local councilman, Samuel Ettaro  who has stood up against the project to ask the important questions.

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Now those of you who have been reading my blog or the popular press may think, what a sec, are the lifecycle GHG standards in the new RFS supposed to stop this sort of a project? Others who read this recent Inside EPA article (subscription, but here's the first paragraph in case: [1]) about how most of the growth in the corn ethanol industry is grandfathered and thus exempt from these standards may think, so this is one of the projects that squeaked through. No disrespect, but both groups are wrong.

The RFS establishes criteria for fuel that can be used by the oil companies to comply with the standard. The law requires that all renewable corn-based ethanol used to comply with the RFS “produced from new facilities that commence construction after the date of enactment of this sentence, achieves at least a 20 percent reduction in lifecycle greenhouse gas emissions compared to baseline lifecycle greenhouse gas emissions.” In other words, if someone want to make substandard fuel, they're allowed, but you got to wonder who is going to buy it.

As to the grandfathering provision embedded in the language above, it exempts fuel produced at existing facilities and facilities that commenced construction on or before December 19th, 2007, from the 20% greenhouse gas reduction requirement. The US Environmental Protection Agency is responsible for implementing the RFS and has not promulgated a definition for “commenced construction” in this context. The definitions that EPA has used elsewhere when implementing air pollution regulations generally require a project to have all of its permits, and to either have made large, irrevocable, construction-related financial commitments or to have begun actual on-site construction.

The project in question doesn't have local land-use or building permits, reportedly doesn't have title to the land, may not even have all of its financing lined up, and certainly hasn't broken ground. In other words, there's no way under any existing regulatory definition of "commence construction" that this project is anything other than a new project. Therefore, its ethanol is going to have to meet the 20% reduction requirement gasoline to be considered “renewable fuel.”

Now a legal eagle among my loyal readers will point out that EPA is allowed to lower the 20% requirement to 10%. But this facility is using waste coal to convert corn into ethanol. Even under traditional lifecycle analyses this combination can't come close to a 10% reduction and the definition of lifecycle GHG emissions in the RFS goes beyond the traditional approaches in very important ways. While EPA is in the process of developing the regulation to implement the lifecycle definition, nevertheless, I find it extremely unlikely that ethanol from a facility that uses waste coal for process energy would be able to meet this lifecycle emissions requirement for the following two reasons:

  • · Traditional lifecycle analyses have estimated that ethanol refined at a facility using coal for process energy produces more greenhouse gas emissions than gasoline over both fuels’ lifecycles. NRDC’s internal calculations historically have suggested that using combined heat and power can improve this balance, but only to the point of making the ethanol just slightly better than gasoline. The figure below comes from a peer reviewed journal article authored by one of the foremost authorities on the lifecycle greenhouse gas emissions of ethanol, Michael Wang from Argonne National Laboratory. As this figure suggests, according to traditional lifecycle assessments, unless a coal-fire ethanol refinery is not drying its distiller grains, the ethanol produced would not comply with the minimum standards in the RFS.

  • -Studies published in Science earlier this year have shown that emissions from land-use changes caused direct and indirectly by the growing of crops in order to make biofuels can dominate the lifecycle emissions and have been either ignored or significantly under estimated in traditional lifecycle analyses. While the assessment of emissions from land-use changes caused indirectly by biofuels is at very early stages, the definition of lifecycle GHG emissions in the Energy Independence and Security Act explicitly requires EPA to include these emissions. Even if the values suggested in the Science articles prove to be off significantly, including emissions from land-use change will make it all but impossible for ethanol produced at a facility that uses coal for process energy to meet the standards in the RFS.

So if the project is not going to be exempted and will have to meet the GHG standards but by virtue of using waste coal doesn't have a chance in hell of complying with those standards, why is it being built? And just as interestingly, who is financing it and where's the due diligence? Or is there a market for substandard, uncertified ethanol? And if there is what does that say about the need for ethanol incentives? 

If you have any answer, I'm all ears. This is one project that no one should be interested in building or paying for. We have to wake up the financial community towns like Curwensville don't get stuck with half baked, fully polluting dinosaurs like Sunnyside Ethanol. 

[1] From Inside EPA article:

Despite draft modeling showing that coal-fired ethanol plants will exceed the energy law's lifecycle greenhouse gas (GHG) standard, agency officials say that few existing facilities will be subject to the GHG standard because facilities exempted from the standard by Congress will likely be able to provide almost all the fuel needed to meet the law's 15-billion gallon corn ethanol mandate.