Enzyme Sugar-Ethanol Platform Project

1. National Renewable Energy Laboratory Operated for the U.S. Department of Energy by Midwest Research Institute • Battelle • Bechtel Enzyme Sugar-Ethanol Platform Project

2. Project Goal • Objective: Develop and demonstrate economical bioethanol technology based on enzymatic cellulose hydrolysis • Feedstock Constraint: Develop the technology for an abundant biomass resource that can support production of at least 3 billion gallons of ethanol per year

3. Approach • Select corn stover as feedstock • Most abundant, concentrated domestic biomass resource • Potential to leverage existing corn harvesting and processing (esp. to produce fuel ethanol) infrastructure and “bridge” industrial contacts • Utilize low cost enzymes now being developed • Genencor International and Novozymes Biotech Inc. are leading enzyme development work through cost-shared subcontracts from the USDOE. Lower cost enzymes are anticipated in 2003-2004. • Demonstrate compelling process economics • Validate improved process performance and identify potentially attractive commercialization scenarios.

4. Project Scope NREL-led Development Industry-led Commercialization Prelim. Studies Detailed Investigation Process Development Testing and Validation Commercial Launch Stage 1 Stage 2 Stage 3 Stage 4 Stage 5 Gov. & Univ. & Corp. R&D Industry-led deployment Increasing Cost & Industrial Involvement

5. Strategic Fit • The project demonstrates enabling technology for a lignocellulose-based biorefinery • The project focuses on the core steps needed to produce sugars, fractionated lignin, and ethanol • Industry is focusing on the application of this technology to make new products

6. External Drivers or Showstoppers • Price of Oil and Gasoline (Transportation Fuels) • Global supply and demand issue • Contingent on fuel standards and energy policy • Price and Availability of Starch (Grain) Ethanol • Existence of renewable fuel standard • Markets for starch ethanol co-products • Price and Availability of Corn Stover • How much canbe removed and what does it cost? • What infrastructure needed for collection, storage and delivery? • Are there alternative markets that will out compete ethanol? • Environmental Regulations and Policies • Greenhouse gas mitigation, carbon tax, etc.

7. Simplified Process Schematic Steam & Acid Enzyme Feed Handling Pretreatment Fermentation Corn Stover Hydrolyzate Broth Recycle Water Waste Water Recycle & Condensate Solids S/L Sep Liquor Conditioning Distillation & StillageTreatment Steam Waste Water Treatment Waste Water Waste Water Syrup Biogas & Sludge Ethanol S/L Sep Cake Steam Utilities Burner/Boiler Turbogenerator Storage Electricity

8. Relative Cost Contribution by Area Capital Recovery Charge Raw Materials Process Electricity Grid Electricity Total Plant Electricity Fixed Costs 33% Biomass Feedstock 5% Feed Handling 18% Pretreatment / Conditioning SSCF 12% (after ~10x cost reduction) 9% Cellulase Distillation and Solids 10% Recovery 4% Wastewater Treatment 4% Boiler/Turbogenerator Utilities 4% Storage 1% (0.30) (0.20) (0.10) - 0.10 0.20 0.30 0.40

9. Process Economics • Production costs dominated by • Feedstock • Enzymes - cellulases • Capital equipment throughout the plant • The focus of the project is to work closely with USDOE, ORNL, USDA, and others, to decrease these key cost factors.

10. Key Cost Reduction Strategies • Minimize feedstock cost • Work with ORNL, USDA, and others to reduce the cost of corn stover by developing policies and infrastructure for efficient collection, storage and delivery • Minimize enzyme cost • Exploit anticipated thermo-stability of lower cost enzymes being developed by Genencor and Novozymes to reduce enzyme and capital costs for process • Reduce processing plant capital cost • Demonstrate improved integrated process performance • Use process engineering techno-economic models to explore potential benefits of co-location and co-products

11. Market Goals • The project targets achieving a commercial production cost of $1.10 per gallon by 2010 • This target is based on a combination of technical conversion process performance goals and market considerations • The market for ethanol is driven by refinery demand for ethanol as a gasoline blend stock

12. Ethanol Value-Demand Curve • Oak Ridge National Lab’s linear programming model for a generic oil refinery used to estimate ethanol value as a function of demand (usage) • Results quantify how the value of ethanol decreases as more of it is used

13. Refiner Ethanol Demand Curve Reference conditions Higher ethanol demand scenario From G. Hadder (ORNL, 1999)

14. Demand Curve Findings • At $1.10 per gallon, refiners can afford to use 1-5 billion gallons per year of ethanol, depending on the future price of petroleum • This estimate does not include the effect of a tax incentives • If the tax incentive continues at $0.50 per gallon ethanol, refiners can afford to use 10-11 billion gallons per year

15. Possible ProcessScenario Feedstock Handling Pretreatment S/L Separation Steam & Acid Corn Stover Solids Liquor Lime Enzyme CO2 Ethanol Gypsum Steam Conditioning Saccharification & Fermentation Wastewater Treatment Distillation & Ethanol Purification Burner/Boiler Turbogenerator Lignin Residue Steam Electricity

16. Feedstock – Corn Stover * Composition is average of 5 stover pretreatment runs at NREL

17. Rationale for data: Feedstock Cost: Walsh, et.al. (ORNL) Demonstrated at Harlan, IA Feedstock Composition: Averaged stover data (NREL) Research underway to improve analysis methods and understand major sources of compositional variance Feedstock – Corn Stover

18. Feedstock – Corn Stover Large Cost Impact Feedstock Cost Impact $1.50 $1.48 $50 / BDT $1.28 $0.65/gal $35 / BDT $1.00 $0.83 Minimum Ethanol Selling Price ($/gal etoh) $0 / BDT $0.50 $0.00 Process Case

19. Feedstock Handling • Brings biomass into facility • Prepares biomass for pretreatment • Subcontract work to develop less expensive handling systems

20. Pretreatment - Example • Converts hemicellulose to monomeric sugars • Makes cellulose more susceptible to enzymatic hydrolysis

21. Pretreatment - Example • Converts hemicellulose to monomeric sugars • Makes cellulose more susceptible to enzymatic hydrolysis • Rationale for Data: • Corn stover steam gun expts • Hot wash process expts • Prior research on hardwood • feedstocks

22. Pretreatment - Example Reactor Solids Cost Impact: Prehydrolysis Solids Concentration Sensitivity $1.50 $1.45 $1.40 $1.35 Minimum Ethanol Selling Price ($/gal) $1.30 $1.25 $1.20 10% 15% 20% 25% 30% 35% 40% Prehydrolysis Solids Concentration inside Reactor

23. Pretreatment - Example Xylose Yield Cost Impact: Xylose Yield Cost Impact $1.50 $1.50 50% xylose $0.27/gal 85% xylose $1.28 $1.23 95% xylose $1.00 Minimum Ethanol Selling Price ($/gal etoh) $0.50 $0.00 Process Case

24. Solid/Liquid Separation • Separate pretreated solids from liquor • Countercurrent hot water wash increases enzymatic digestibility and solubilizes recoverable lignin

25. Rationale for Data: Lower acetylation of corn stover hemicellulose means IX not needed to reduce acetic acid levels Hot wash process expts Harris subcontract Working towards pilot scale demonstration at NREL Solid/Liquid Separation • Separation of pretreatment solids from liquor • Countercurrent hot water wash increases enzymatic digestibility and solubilizes recoverable lignin

26. Solid/Liquid Separation Cost Impact: Conditioning Sensitivity $1.50 $1.45 $1.40 Minimum Ethanol Selling Price ($/gal etoh) $1.35 $0.08 / gal $1.30 $1.25 $1.20 OL only IX / OL Process Case

27. Saccharification & Fermentation • Enzymatic hydrolysis of cellulose to glucose • Microbial conversion of sugars to ethanol

28. Saccharification & Fermentation • Enzymatic hydrolysis of cellulose to glucose • Microbial conversion of sugars to ethanol • Rationale for Data: • Enzyme Cost is 10x-reduction from Glassner-Hettenhaus parameters • 10x-reduction is goal of enzyme subcontracts • Hybrid design advantageous for more thermotolerant enzyme system

29. Saccharification & Fermentation • Enzymatic hydrolysis of cellulose to glucose • Microbial conversion of sugars to ethanol

30. Saccharification & Fermentation • Enzymatic hydrolysis of cellulose to glucose • Microbial conversion of sugars to ethanol • Rationale for Data: • Previous work based on conversion of hardwood hydrolyzates using Z. mobilis • Nutrients • Strain improvements • 2nd Gen. ethanologen projects at NREL • Literature search

31. Saccharification & Fermentation • Enzymatic hydrolysis of cellulose to glucose • Microbial conversion of sugars to ethanol

32. Saccharification & Fermentation • Enzymatic hydrolysis of cellulose to glucose • Microbial conversion of sugars to ethanol • Rationale for Data: • Initial work based on glucose and xylose cofermenting Z. mobilis • Improved strains constructed with broader pentose and hexose substrate ranges • rDNA yeast • Ingram et al. constructs

33. Saccharification & Fermentation Enzyme Cost Impacts: Enzyme Cost Impact $2.24 $1.07 / gal $2.00 $1.01/gal $.50 / gal $1.67 $1.50 $0.11 / gal $1.28 $1.23 Minimum Ethanol Selling Price ($/gal etoh) $0.06 / gal $1.00 $0.50 $0.00 Process Case

34. Saccharification & Fermentation Cost Impacts: Fermentation Residence Time Cost Impact $1.50 $1.45 $1.40 Minimum Ethanol Selling Price ($/gal etoh) $1.35 $1.32 7 days $1.30 $0.07/gal $1.28 3.5 days $1.25 $1.25 1 day $1.20 Process Case

35. Saccharification & Fermentation Cost Impacts: Fermentation Yield Cost Impact $2.40 70% $2.10 Minimum Ethanol Selling Price ($/gal) 92% $1.80 $1.50 95% $1.33 $1.28 $1.23 $1.20 glucose only add 85% xylose add 85% arabinose all other sugars 85%

36. Saccharification & Fermentation Cost Impact: Contamination 5%  7% equates to $0.02/gal increase Nutrient Cost $0.035/gal 89% CSL, 11% DAP

37. Distillation & Ethanol Purification • Separation of ethanol and CO2 from “beer”

38. Wastewater Treatment • Anaerobic and aerobic treatment • Reduce Biochemical Oxygen Demand (BOD) • Recycle water

39. Burner/Boiler/Turbogenerator • Biomass boiler generates steam from lignin residue • Excess electricity from generator sold to power grid ($0.04/kWh credit) • High capital cost area

40. Current Status • Completing Stage 2 • Compelling scenario identification • Technology selection • Stage 3 plan development • Next step: Gate 3 review • Planned for January 2002

41. Conversion-relatedCost Reduction Opportunities • Stage 2 technology selection focus • Is a better pretreatment technology available? • Higher yields, lower capital or operating costs • Is a better fermentation strain available? • Broader sugar utilization range, higher ethanol yields, better compatibility with enzyme • Stage 3 technology improvement focus • Are better cellulases available and how do they benefit integrated process economics?

42. Technology Selection • Tiered screening approach being applied to ensure best options will be studied in Stage 3 • 1st screen: Efficacy • 2nd screen: Readiness and availability • Stage 2 focus: • Pretreatment technology • Fermentation strain

43. Co-location-relatedCost Reduction Opportunities • Better feedstock price • Proximity to transportation • Farmer cooperative • Reduce capital cost • Utilize existing utilities and processing infrastructure within site constraints

44. Cost Reduction Strategies, cont. • Reduce conversion plant capital cost • co-locate into a dry mill expansion • co-locate with a coal-fired power plant • co-locate with both a dry mill and power plant • Reduce capital cost through better financing • Loan guarantee? • City/county/state/federal support or tax benefits?

45. Cost Reduction through Co-products • New process case potentially enables “sugar platform” and “lignin platform” co-products • Value-added co-products can increase upside of process commercialization and mitigate overall risk • While we can explore the possibilities, development of prospective co-products must be led by industry!

46. Potential Bioethanol Co-products Hemicellulose Hydrolyzate (Xylose) Process Residue Liquids Cell Mass, Enzymes (Protein, etc.) Cellulose Hydrolyzate (Glucose) Pretreatment Hemicellulose Hydrolysis 1o Enzymatic Cellulose Hydrolysis 2o Enzymatic Hydrolysis & Fermentation Ethanol Recovery & Purification EtOH Biomass Process Residue Solids Soluble Lignin (Low/Medium MW Phenolics) Insoluble Lignin (High MW Phenolics)

47. Sugar & Lignin Platform Biorefinery Lignin Product(s) Recovered Lignin Purification & Drying of Lignin Product(s) Catalyst Steam, Acid, Enzyme, etc.) Renewable Biomass Feedstock Water Steam Unrecovered Lignin Sugar Product(s) Sugar-rich Hydrolyzate Feedstock Handling Concentration & Purification of Sugar Product(s) Biomass Fractionation Water Steam Recycle Water Waste Water Unrecovered Sugars Hydrolyzate & Residual Solids Fuel Ethanol Ethanol Production & Recovery Waste Water Treatment Make-up Water Waste Water Biogas & Sludge Steam Residual Solids & Syrup Unrecovered Lignin Power Production (Turbogenerator) Electricity Steam Generation Steam