In the 20th century, Henry Ford envisioned a world powered by ethanol which is a colorless, water soluble, non-toxic and biodegradable liquid.  The most important use of ethanol is as a fuel which Henry Ford used to power his first car 100 years ago or fuel additive for automobiles as ethanol contains 35% oxygen which aids the combustion process. 

Over the next 100 years, however, ethanol and Ford's prescient views would of course be sidelined in favor of petroleum derived, non-renewable fuels i.e. gasoline (an inexpensive by-product of kerosene production) that dominates the liquid fuel market today.

Ethanol Fuel
Ethanol blended gasoline at a ratio of 10% ethanol (E10) reduces tailpipe emissions of CO, NOx, CO2 and Particulate Matter (PM by 50%) by up to 30% and does not require engine modifications or infrastructure upgrades in any brand of today’s automobiles.  According to Argonne National Laboratory, 10% ethanol blends reduce GHG emissions by 12% - 19%.  The potential markets for ethanol also include diesel fuel extension and as a hydrogen carrier for fuel cells.

Ethanol Fuel Industry
United States
In 1990, the United States passed the Clean Air Act, which required gasoline to contain 2.7% oxygen by weight.   This was achieved by adding oxygenates to the gasoline.  Methyl Tertiary Butyl Ether (MTBE) is the most widely used oxygenate with an annual consumption of over 4 billion gallons in the U.S. alone.  With concerns over the health and safety risks of MTBE contaminating water supplies, swift legislation bans in several states including California and New York are increasing ethanol usage substantially.  In 2006, the U.S. consumed approx. 5.2 billion gallons of ethanol while a legislated mandate sets target usage at 7.5 billion gallons by 2012.  Even larger targets of 35 billion gallons by 2017 are currently being debated.  This compelling growth continues as the U.S. needs to reduce its dependence on foreign sources of oil while addressing both economic and environmental concerns.

Brazil
Brazil’s long-term experiment with ethanol has been exceptionally successful by all accounts.  The country shares the title of largest producer in the world with the U.S., producing approx. 5 billion gallons a year.  In 2004, 22% of all vehicles sold in Brazil were flex-fuel variants capable of running on pure ethanol (typically derived from sugar cane) or ethanol/gasoline blends.  In 2005, the number jumped to 53% of vehicles sold while 2006 saw better than 80% of all vehicles sold being of the flex variety.

Canada
Canada plans to use 5% ethanol blended gasoline in all gasoline sold by 2010.  The 2003 demand of 235 million gallons is forecasted to increase by 110 million gallons each year until 2010, when demand is expected to be more than 1 billion gallons per year.  Ethanol will one day provide the government with much needed carbon credits in a future carbon trading scheme.

European Union
In the EU, legislation has been passed such that in 2005, 2% of all transportation fuels must come from renewable sources and 5.75% will be required in 2012.  This will increase ethanol usage from 760 million gallons in 2005 to 2.32 billion gallons in 2012.

Asia
Ethanol is expected to become an increasingly important fuel in much of Asia.  Japan has legislated 3% ethanol in fuel by 2008 and both China (the 3rd largest ethanol producer in the world) and India are considering similar legislation.  Feedstock for producing ethanol in China and India comes primarily from corn and sugar cane and Japan currently imports most of its ethanol.  All are increasingly aware of the limitations that food-derived ethanol harbors and China has gone so far as to ban further production of ethanol from these sources.

Ethanol Feedstock
Agricultural Residues
This source of biomass comes from the leftover organic material from crop harvesting.  corn stover, rice straw, and bagasse are all examples of agricultural residues.  Presently, some residues are used as animal feed, but there are still significant surpluses in many regions.  While using agricultural residues may present a logistical problem due to their seasonal availability, the quantities produced in many regions are large enough that supply problems are not expected.  For example, both Illinois and Iowa produce more than 20 million tons of residues annually.  

Wood Residues
These are the residues left from cutting logs at sawmills, the leftover branches and barks from logging.  Rough estimates indicate more than 70 million tons of residues are produced annually.   Though some of the residues are used for pulp and paper, fiberboard, heating or generation of electricity, much of the waste still has little economic use.

Animal Waste
Animal waste comes primarily from large-scale farming operations.  There are approximately 100 million dry tons (2005) of animal waste produced annually in the United States alone and large concentrations of hogs, poultry and cattle to support facilities in several areas of North America.  These sources are typically very inexpensive to obtain as they are a source of pollution in many regions. 

Landfill Gas
Because the amount of municipal solid waste is expected to increase in the future, this will be a ready source of biomass which can be exploited through tapping the gas from landfills.  A landfill gas resource generally has an expected reserve life without additional capital requirements of 25-40 years. Consequently, an ethanol facility will enjoy the benefit of long term production and market planning.  According to proprietary studies undertaken by Shell Oil, there are in excess of 3,000 active sanitary landfills in the United States.

Ethanol Production
Fermentation
At present, ethanol is largely produced through a fermentation process using food-chain feedstock such as corn, sugar cane, beet and grains.  Fermentation is currently subject to the high costs associated with grain feedstock as well as the year to year volatility of the grain market. The cost of grain based ethanol production at approx. US$1.50/gallon (2007).  Because of the cost and dependency on otherwise useful feedstock, there has been an ongoing search for a better process than grain fermentation.  There are currently a handful of alternative technologies for new ethanol production processes under research.  These processes are able to use low value feedstock like corn stover or wood wastes, but are still either more expensive than corn fermentation or still under research and development.

Catalytic Synthesis
This is the process that Syntec will use to produce ethanol.  Syngas can be derived from renewable sources either through reforming of digester gas or biomass gasification.  The syngas is then reacted into ethanol through a catalyst at approximately 300 degrees Celsius and 1100psi.  This process can use a wide variety of feedstock, but has yet to be demonstrated on a commercial scale.

Enzymatic Fermentation
This process adds an extra step to the fermentation process.  Enzymes are used to break cellulose and hemi-cellulose into sugars.  The sugars are then fermented into ethanol.  While this process can use some of the cellulosic feedstock, the additional processing required from using enzymes and the cost of enzymes add to the cost of production.

Dilute Acid Hydrolysis Fermentation
This process uses dilute acid in a two steps process to break down hemi-cellulose and cellulose under high temperature and pressure.  The additional acid treatment adds cost to the overall process and it tends to produce large amount of byproducts.

Concentrated Acid Hydrolysis Fermentation
It uses a concentrated acid solution to break down cellulose and hemi-cellulose into sugars.  The sugars are fermented as in a normal fermentation process.  Recycling of acid is required for economic reasons, an area where research is still ongoing.