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Converting waste to energy: does trash stack up? (9 January 2019)

Research commissioned by CRDC has found the conversion of cotton gin trash to ethanol is scientifically achievable – but is it an economic reality?

Cotton gin trash is a waste by-product created in the cotton ginning process. It consists of leaf matter, stalks, dirt and cotton fibre. Trash is a voluminous, light substance which becomes a burden to store, sell or convert effectively into a form of organic fertiliser.

“It is generally considered a nuisance by cotton ginners,” says Janine Powell, who has analysed the economics of an ethanol production plant using gin trash in a CRDC-supported study.

Janine and Jon Welsh of AgEcon used a hypothetical case study of a gin trash to ethanol plant at Narrabri in NSW to determine the viability of conversion.

“A market for ethanol has been created by established biofuels policy in NSW and state government mandates in Queensland for inclusion of biofuels into petroleum based liquid fuel, prompting the research,” Janine said.

“As a renewable resource and waste by-product, converting gin trash to ethanol makes environmental sense.

“The economic investment analysis in this study has shown a modest yet positive return based on a hypothetical plant converting gin trash to ethanol situated in the Namoi Valley of NSW, due to accessibility and volumes of gin trash from gins in the region.

“The baseline analysis returned a positive net present value, payback in year 12 of 25 and an internal rate of return of nine percent.”

Compared to other ethanol feedstocks, gin trash is more competitive than grains and comparable to the lower-cost feedstock molasses, which is currently converted in an ethanol plant in Sarina, Queensland. The key differences between these feedstocks as suitable sources is the zero-feedstock market price of gin trash. Conversely, the variable costs to process gin trash are almost two-and-a-half times that of molasses, wheat and sorghum.

However, returns from higher capital costs such as improved processing technologies and sensitivity testing of higher feedstock costs also found considerable vulnerability in the model. Exposure to market risk on inputs and outputs can potentially be mitigated with long-term supply agreements. These would have to be carefully managed to recoup the significant capital outlay during the tardy investment payback period.

“The cost to build an ethanol plant producing three million litres per year did create a significant economic hurdle with fuel pricing at current levels coupled with the high-cost of moving the high-volume trash – even short distances on-site and between gins,” Janine said.

“Interestingly, there is some new technology underway in Asia allowing combustion (for electricity generation) of the large amounts of waste liquids from the distilling process, which could potentially improve the future investment bottom line.”

CRDC R&D Manager Allan Williams says while the variable nature and low density of gin trash makes it a challenging product to add value to, the availability of new technologies will likely provide new opportunities for turning gin trash into a valuable by-product of cotton growing. He said as well as looking at the viability of turning gin trash into energy, CRDC is also investigating the potential for using it as a feedstock for creating fine chemicals given its high cellulose content.

“There are increasing expectations that a sustainable supply chain is also a ‘closed loop’, that they produce minimal levels of waste at every stage, from raw material production through to consumption,” Allan told Spotlight.

“Turning gin trash into a valued commodity would increase the economic returns of cotton production and enhance the reputation of the Australian cotton industry for its commitment to innovation and sustainability.”

For more contact CRDC R&D Manager Allan Williams: allan.williams@crdc.com.au

Pictured: Steps in ethanol production from gin trash.