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Ethanol plant roll-out could go national

From small things: Coskata's bio-ethanol is set to be made by a new company, Flex Ethanol Australia, in Melbourne - and maybe other capital cities.

GM Holden hopes Melbourne ethanol plant could just be the first of several

8 Dec 2010

A NEW company founded by a consortium headed by GM Holden and Caltex to generate ethanol from rubbish will look to expand to all major capital cities in Australia if all goes well with an initial plant proposed for Melbourne by 2013.

Flex Ethanol Australia – announced by GM Holden chairman and managing director Mike Devereux in Melbourne today – formalises a consortium of companies that plan to introduce the breakthrough refining process to Australia to make ethanol to be blended with petrol for motor vehicles.

Mr Devereux said a plant to be built by the company in Victoria would be capable of turning up to a million tonnes of household rubbish and building waste into more than 200 million litres of ethanol a year.

“The plant here could potentially process hundreds of thousands of tyres a year which are currently a huge contributor to Australian landfill,” he said in a speech to the American Chamber of Commerce in Australia.

Holden’s energy and environment director Richard Marshall told GoAuto that rubbish produced by all major cities in Australia could potentially be used to generate ethanol for the fuel commonly known as E85.

“You have to start with one plant, obviously,” he said. “The whole view on this particular business model we have got is that you could easily support a couple of plants in each of the major capital cities.

“They are the ones that generate the most rubbish. If you look at the amount of rubbish that’s generated in Melbourne, it is something over three million tonnes a year.”

 center imageFrom top: Holden Commodore filling up with E85, bio-ethanol production, Holden director for energy and environment Richard Marshall.

While no figure has been put on the cost of the new Melbourne plant, $300 million was mooted when the project first went public in 2009.

The new company is believed to be the first outside North America to draw up firm plans to generate ethanol from rubbish using the Coskata method.

Invented by American biological renewable energy technology company Coskata Inc, the process uses proprietary microorganisms and patented bioreactor designs to break down almost any waste material made of carbon, including waste straight from household rubbish bins.

Holden declined to name the full list of companies that will partner it and Caltex in the new company until the final paperwork has been wrapped up in the next few weeks.

The original consortium announced in a memorandum of understanding in March this year included waste disposal company Veolia, diversified energy company Mitsui, Coskata and the Victorian government, as well as Holden and Caltex.

Mr Marshall said Coskata – which is financially backed by Holden parent company GM in the US – would be the technology provider to the new company, not an equity partner in Flex Ethanol Australia.

He said one of the first activities of the new company would be to trial Australian-style waste in the ethanol-making process at Coskata’s ‘lighthouse’ facility in Pittsburg, Pennsylvania.

“That is to prove our business model completely on the actual feedstocks we are going to use and the Melbourne specification of waste,” he said.

“This is one of the key things that hasn’t been done yet. People really want to know you can take the material you have got here and run it through the process, and that it goes straight into the lighthouse facility and gives you exactly the same result.

“That’s really the cornerstone of the proof out of the technology for this feedstock mix.” Mr Marshall said the second-generation process had shown that household rubbish could be tipped straight into the ethanol plant with minimal sorting.

“One of the key things we have been able to prove put of this technology now is that we will actually be able to take the trucks directly from picking up the kerbside wheelie bins and dump the material directly into the plant,” he said “You have to do some very preliminary sorting – nothing that much.

“It is not going to hurt the process to put a whole lot of cans and bottles and bricks through, but obviously you don’t want to gasify them if you don’t have to, so there needs to be some sorting.” Mr Marshall said it was too early to name potential sites for the first plant in Melbourne, but said the new company would do feasibility studies on a couple of potential sites that had been identified.

He said the land required for the plant itself was not large, but it would require a buffer zone.

Mr Marshall said the logistics and cost of getting rubbish to the plant would be a key consideration.

This suggests the plant might be sited closer to a rubbish disposal processing area than Caltex’s oil refinery at Altona.

Speaking at the American Chamber of Commerce in Australia meeting in Melbourne, Mr Devereux – who replaced fellow American Mark Reuss as boss of GM Holden in March – hinted that the motor industry expected the federal government to take a role in the introduction of bio fuels, which will be slugged with an excise, along with petrol and LPG, from July next year.

“Ultimately, what I want people to take away from this is that we’re not driving change for ethanol, rather ethanol is one of the means to achieve environmental and social benefits,” he said.

“We can achieve this through better waste management, more sustainable driving and great energy independence for Australia.

“That is something that certainly, in my role as president of the FCAI (Federal Chamber of Automotive Industries), I will be talking to the Gillard government about over the coming months.” Holden this year became the first Australian car-maker to introduce a locally built car capable of running on E85 when it launched is new VEII Commodore range in September.

Its partner in Flex Ethanol Australia, Caltex, offers E85 from 30 service stations across Australia, while some independent fuel retailers also offer the fuel.

Ethanol currently sold in Australia is made by one of two companies - CSR spin-off Sucrogen BioEthanol, which makes its ethanol in Queensland from sugar cane waste, and the Manildra Group which produces fuel ethanol from waste starch and grain at a facility near Nowra, NSW.

A 10 per cent ethanol-petrol blend, E10, is widely available, and will become the minimum standard in unleaded petrol in NSW from July 1 next year.

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