When the housing market recovers and the demand for wood increases? The cost of anything made with wood will go up.
Just as the cost of any food product made with or fed corn has gone up with the food for fuel ethanol mandate.
Keep punishing the middle class and the poor that are just trying to stay alive and the elitist leading the sustainable movement, making all the profits from the higher cost of living, will see more than a little backlash.
A sample of Primus Green Energy's high-octane gasoline.
A start-up sited near the Jersey Shore could soon be producing even more energy than rowdy twentysomethings partying down at the boardwalk by converting tons of wood pellets and grasses into high-octane gasoline.
Primus Green Energy (PGE) is ramping up to build a plant that would turn out over 75 million gallons of biofuel per year. PGE’s facility would be profitable at $60 per barrel of oil, and would be a sustainable domestic source of gasoline, the company says.
75 million gallons is enough energy to keep 10,000 people driving 21 miles per day, said vice president of business development George Boyajian. Making that much biofuel would also involve accumulating 530 tons of biomass annually.
PGE chose wood pellets as its feedstock due to their high BTU content, consistency, and long-term availability, Boyajian said. The pellets would also be sourced domestically in the United States. It will eventually shift to using miscanthus grass.
European power companies are driving demand for wood pellets as a replacement for coal, and lumber mills are responding to slumping housing starts in the U.S by diversifying into the energy industry. There are currently 7 suppliers throughout several regions of the U.S., Boyajian noted.
The PGE biofuel process. (Image Credit: Primus Green Energy)
PGE’s process begins by taking wood pellet, or miscanthus grass, in their peptized form and introducing the feedstock into a gasifier (see the diagram to the right).
That step yields a syngas with higher than normal octane ratio, which is then treated in a commercial scrubber. The syngas is lastly synthesized into gasoline using an off the shelf catalyst. That process, however, is proprietary.
Other byproducts could include jet fuel and plastics, but fuel will build the company. Oil companies are buying up the biofuel to meet the U.S. government’s cellulosic ethanol requirement, Boyajian explained. They are currently being fined millions for not buying it as mandated under the 2007 Energy Independence and Security Act.
Uncle Sam will continue to collect - at least for the time being. PGE will require a $500M investment to scale to 75 million gallons annual capacity, and it would take a few years to build a plant. A plant could be online as soon as 2013.
PGE’s Boyajian noted that the Pearl GTL (gas to liquids) facility in Qatar has cost over $19 billion to build, and said that PGE’s process is a “drop in the bucket” in comparison.
In the near term, PGE will be opening a continuous demo facility in Q4. Its initial output will be 30L per hour, or a barrel of gasoline every five hours. Engineering giant Betchel is PGE’s contractor, and it has already broken ground.
Israel Corp.’s IC Green Energy had invested over US$40M into PGE, and PGE anticipates that it will take at least another $40M in its next round after its capital expenses are proven out, Boyajian said. It currently has 40 employees.
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