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Cracking cellulose

Thirty miles inland from Fort Meyers, Florida, stretches a 112,000-acre farm and ranch, Alico, Inc. It's a flat expanse of fields, savannas, cabbage palm, and cypress bogs on the verge of a bio-fuels revolution.

The publicly traded land management firm in LaBelle, Florida, is diverse. Its cow herd was the nation's sixth largest until drought forced culling to 11,000 cows last year. It grows vegetables, 11,000 acres of citrus, 64 million start-up plants for commercial growers, and 14,000 acres of sugarcane. There is little its savvy owners don't sell, including hunting leases for deer, coyotes, and wild pigs. It even harvests alligators and their eggs.

Alico has something else -- enough biomass to produce 21 million gallons of ethanol a year. That's a reason its subsidiary, Alico Energy LLC, was the only farm among six companies picked by the Department of Energy for grants to jump-start cellulosic ethanol.

Cellulose is the green version of the atom, with huge potential for liquid energy. The stuff of cell walls in plants, it accounts for a third of all the earth's plant material. It's made up of sugars, but until recently it's been expensive to unlock them.

This year the race to crack cellulose is picking up. It began with KL Process Design Group becoming first to market cellulosic ethanol made from waste wood near the Black Hills. General Motors announced an investment in a high-tech cellulosic ethanol company, Coskata. Range Fuels is building a 20-million-gallon cellulosic ethanol plant in Soporton, Georgia, that also will use wood as a feedstock.

To John Alexander, the CEO of Alico, the decision to look into ethanol production was pragmatic. Alico management was looking for better profits from sugarcane.

"The prices have been stationary for about 20 years, and the cost of growing it has intersected the price," Alexander says over lunch at the ranch's headquarters.

At first, Alico considered the Brazilian method of fermenting ethanol from cane sugar. It soon discovered an environmental problem -- 10 gallons of liquid waste, or vinasse, for every gallon of ethanol. "They dispose of it in ways that we cannot," Alexander continues. U.S. clean water laws and local protections of the Florida Everglades bar Alico from dumping vinasse.

With the help of consultant Craig Evans, Alico decided to use a completely different technology -- gasification. That approach uses high heat to turn energy cane (or anything with carbon) into mainly carbon monoxide and hydrogen. Those syngases go into a fermenter where patented microbes turn them into ethanol.

Besides producing less waste, gasification offers the advantage of being able to use all of the energy cane. "Only one third of sugar cane goes to sugar," Evans says. The rest is leaves (currently burned off before cutting) and bagasse (what's left of cane after its sap is squeezed out).

Unlike other companies chosen for DOE cellulosic grants, Alico isn't a technology company. This spring it was in the last stages of licensing gasification technology from Bioengineering Resources, Inc. of Fayetteville, Arkansas. Alico sees itself as a source and a gatherer of biomass for that process. It may use yard waste, citrus peel, and other sources in addition to energy cane. Evans estimates that within 100 miles of Alico are enough yard and agricultural wastes to make 100 million gallons of ethanol.

Far from the warmth and perpetual green of Florida, Mark Stowers is working on other ways to turn cellulose into fuel. As vice president for research and development for POET in Sioux Falls, South Dakota, Stowers and a growing staff of researchers are looking for the best ways to break down corncobs and the fiber in corn kernels into fermentable sugars.

A screen saver on Stowers' office computer shows astronaut Neil Armstrong standing on the moon.

"It reminds me every day that the challenge of cellulosic ethanol is not too dissimilar to the challenge of putting a man on the moon," Stowers says.

He guides a visitor through labs and new labs under construction. In one, researchers Bill McDonald and Jason Kwiatkowski are doling out brownish-orange sludge from a thick metal container called a zipperclave. It has a faint sweet smell of molasses or silage. Stowers describes this as the crude oil of cellulosic ethanol. It's what you get after putting ground red corncobs into the zipperclave and treating them with pressure and chemicals. It's a mixture of sugars that can be fermented into ethanol with yeast or microbes.

POET is testing more chemicals and enzymes that break cellulose into sugars. It's testing microbes for fermentation. "We're leaving no rock unturned," Stowers says.

Even the way corncobs are stored and ground up can affect ethanol yield. So last fall, the company harvested 4,000 acres of cobs near Hurley, South Dakota, and carried out more than 100 storage experiments, says POET's CEO, Jeff Broin. "We need to understand how this affects the ethanol process."

Next year, the company will start building a 25-million-gallon cellulosic ethanol plant next to its 100-million-gallon corn ethanol plant at Emmetsburg, Iowa. Right now, the cost of making ethanol from corncobs and indigestible corn fiber is about $1 per gallon more than corn ethanol. By the time the company starts up its cellulosic plant in 2011, it hopes to erase that difference.

Unlike gasification, POET's use of chemicals and enzymes to make cellulosic ethanol does leave by-products. But those will provide energy for making grain ethanol, Stowers says. Merging cellulosic with grain ethanol makes both more efficient. With cellulose, POET expects to get 11% more ethanol from a bushel of corn and 27% more from an acre of corn while eliminating most of the fossil fuel used in the whole process.

Thirty miles inland from Fort Meyers, Florida, stretches a 112,000-acre farm and ranch, Alico, Inc. It's a flat expanse of fields, savannas, cabbage palm, and cypress bogs on the verge of a bio-fuels revolution.

Another sign of a surge in cellulose is General Motors' stake in Coskata, an ethanol firm with its own expanding labs in a suburban office park in Warrenville, Illinois, outside Chicago. Unlike Alico and POET, it didn't get a DOE grant. But it has deep-pocket backing from Vinod Khosla. The founder of Sun Microsystems is a venture capitalist to several bioenergy firms, including Range Fuels.

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