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Friday, November 20, 2009

Poet Cuts Cellulosic Ethanol Production Costs 43%

Expect CE commercial competitiveness by 2011, says CEO Broin.

April was right: Jeff Broin's Poet Ethanol has achieved a cost breakthrough on cellulosic ethanol

POET announced today that cost reductions achieved over the past year of operating their cellulosic ethanol pilot plant have exceeded expectations in their drive to commercialize the process. Reductions in energy usage, enzyme costs, raw material requirements and capital expenses have reduced POET’s per gallon cost from $4.13 to $2.35 over the course of the past year, and the company’s goal is to be below $2 by commercial plant start-up ["On first anniversary of pilot plant start-up, POET announces cost reductions in cellulosic ethanol," press release, Poet, 2009.11.18].

Poet CEO Jeff Broin expects to get production costs down a commercially viable level below $2 a gallon by 2011, when it plans to open its 25-million-gallon/year cellulosic ethanol plant in Emmettsburg, Iowa (brought to you in part by $100 million dollars from Uncle Sam—you're welcome!).

Dr. Mark Stower, senior Poet sci-tech VP, explains it all:

Forget sending that federal money back; let's roast those corn cobs and start sending oil back to Saudi Arabia and Canada!


  1. Steve Sibson11/20/2009 8:40 PM

    What is the cost to process crude?

  2. I would suppose it depends on the type of crude. Tar sand muck would cost more to refine than light sweet Texas crude.

    There are also other costs to consider. Crude from the middle east requires massive military intervention to protect the shipping lanes to get it here. The tar sands of Canada don't require that military assistance but mining them does cause considerable environmental damage.

  3. Possible answers to Steve's very reasonable question (a question I'll bet is central to Mr. Broin's calculations):

    --These hybrid hippies say that dependence on foreign oil, complete with military expenditures, costs $11.35/gallon.

    --The feds put crude oil and refining costs at $1.63 per gallon in 2005. That was with oil at $50.23 per barrel.

    --Updated numbers from California put current crude oil and refining cost at $2.12 per gallon... which appears to be in the ballpark Broin would be looking at for competitiveness.

  4. Steve Sibson11/23/2009 6:22 AM

    Ok, so since ethanol can be competitive on its own, why have government subsidies?


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