Corn ethanol firm says it cut production costs

The nation’s largest producer of corn-based ethanol said it had slashed the cost of producing cellulosic ethanol from corncobs and that it would be able to compete with gasoline in two years.

Poet, which currently produces 1.5 billion gallons a year of ethanol from corn, said its 1-year-old pilot plant has reduced the cost of making ethanol from corncobs to $2.35 a gallon from $4.13 by cutting capital costs and using an improved “cocktail” of enzymes.

Moreover, the company said it could use a byproduct called lignin as fuel and that it would provide all the energy needed for the cellulosic plant as well as 80% of the energy that would be needed by a conventional corn-based distillery making twice the amount of ethanol.

“Two years ago I would have told you this was a long shot,” said Poet Chief Executive Jeff Broin. “Now I’ll tell you that we will produce cellulosic ethanol commercially in two years.”

Poet, of Sioux Falls, S.D., launched the cellulosic-ethanol pilot plant a year ago in Scotland, S.D., and Broin said the plant had figured out how to cut capital costs 40%, cut the amount of energy used in pre-treatment stages and lower enzyme costs.

He said farm equipment makers were designing, and in two cases selling, equipment to collect corncobs from fields.

For farmers, the advance could mean extra income. Broin said an acre of corn could produce 480 gallons a year of corn-based ethanol and 55 gallons more from processing cobs, leaves and husks.