The production and consumption of ethanol has grown considerably in the last few years, mainly as a renewable fuel. The use of ethanol as a fuel now accounts for 80-90% of global consumption.
A growing use of ethanol is an additive in gasoline where it is used to boost octane levels, increase combustion efficiency and act as an oxygenate reducing automotive emissions. In the US, it has replaced the use of methyl tertiary butyl ether (MTBE) in gasoline. Some MTBE producers in Europe have switched production to ethyl tertiary butyl ether (ETBE) based on bio-ethanol. In some countries such as Brazil and the US, ethanol is also being used to replace gasoline in flexible fuel cars with concentrations of up to 85% ethanol/15% gasoline (E85).
Aviation grade ethanol (AGE-85) containing an 85% ethanol blended fuel is being considered for use in reciprocating engine aircraft. It can replace 100 octane low lead aviation gasoline (avgas) which is said to be a major contributor to lead in the atmosphere. AGE-85 is claimed to give improved performance, producing 12% more power and torque, as well as enabling engines to run cooler than with avgas and extending engine overhauls.
While fuel uses for ethanol now dominate consumption, its use in the industrial sector is still significant. Around 60% of industrial ethanol is used as a solvent in the manufacture of pharmaceuticals, paints and lacquers. However, it is facing environmental restrictions because it is classified as volatile organic compound (VOC) and so its long-term growth is flat.
Ethanol is also used as a carrier in medicines such as cough treatments and decongestants. Food products such as extracts and flavourings can contain ethanol.
A large user of industrial ethanol is the personal care products industry where it is used in products such as hairsprays, mouthwash, perfume, cologne and deodorants. In addition, it is used in medical wipes, hand sanitizers and other cleaning products at concentrations up to 70%. Ethanol is effective at killing organisms and demand has increased in hand sanitizers as a result of concerns from the swine flu outbreak.
Ethanol is used as an intermediate in the manufacture of other chemicals such as ethyl acrylate, ethylamines, acetic acid and ethyl acetate. In Brazil, there are a number of projects that plan to produce ethylene from ethanol made from sugar cane for the production of polymers. Dow Chemical and Braskem plan to build polyethylene plants that use ethylene derived from ethanol while Solvay will use this fermentation-based ethylene to make ethylene dichloride (EDC)/vinyl chloride monomer (VCM) for polyvinyl chloride (PVC) production.
Pure beverage ethanol is manufactured in the form of grain neutral spirits which is sold to bottlers or other distillers for blending into other products. For example, drinks such as vodka and flavoured alcoholic beverages use grain spirits.
Record ethanol production
The world ethanol industry produced a record 17.3bn gals (52m tonnes) of ethanol in 2008 and could produce up to 20.4bn gals in 2009, according to the US-based Renewable Fuels Association (RFA). The US was the largest producer in 2008 at 9.2bn gals followed by Brazil at 6.47bn gals. The European Union manufactured 734m gals in 2008 while China produced 502m gals.
The ability to provide long-term forecasts for global ethanol supply/demand can be problematical as actual growth depends on a number of economic and technical factors as well as changes in legislative and regulatory policy. Government mandates can be changed or waivers granted while resistance to mandates can force governments to change policies.
Ethanol demand in the US jumped by over 40% in 2008 to more than 9.5bn gals, calculates the RFA. Imports of ethanol into the US exceeded 500m gals, an increase of more than 100m gals in 2007, according to data from the International Trade Commission (ITC).
In 2008, ethanol capacity in the US grew by 2.7bn gal/year to reach 10.6bn gal/year in January 2009. This growth came from the completion of 31 ethanol plants. Ethanol is produced in 26 states with Iowa having the largest capacity at 3.1bn gal/year. At this time, a further 24 plants accounting for 2.1bn gal/year of ethanol capacity were under construction or being expanded.
However, a combination of the economic downturn and the overcapacity has resulted in some US plants being idled in the first half of 2009 with a number of producers in bankruptcy. The US ethanol industry is expected to undergo consolidation with a few larger players dominating the market. Analysts predict the industry will go through a transition period lasting 2-4 years.
With ethanol blending limit in gasoline set at 10% in the US, the RFA argues that the industry is hitting a ‘blend wall’ as nearly 80% of gasoline in the US now contains ethanol. It is arguing for the cap on ethanol blending to be increased as well as increased introduction of infrastructure and pumps for E85 fuel for flex-fuel vehicles. In early 2009, there were 1,900 stations offering E85 fuel in the US.
Updated: May 2009. Sources: ICB Chemical Profile, 25 May 2009; RFA 2009 Ethanol Industry Outlook.
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Ethanol was first produced thousands of years ago by fermentation of carbohydrates and in some countries large volumes are still produced by this method. Synthetic alcohol was first produced industrially in the 1930s by indirect catalytic hydration of ethylene but suffered from disadvantages such as corrosion from the large volumes of sulphuric acid handled and the energy required for concentration.
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