Closed-Loop Companies | Westworld
by: Lawrence Herzog
April 2010

At Big Rock Brewery, spent grain is used as cattle feed. Pictured here is brewmaster Paul Gautreau

Alberta may not always get an A-grade when it comes to the environment, but in some areas the province’s enterprises are on the leading edge. In industries from agriculture to forestry to beer, Alberta businesses are taking their own initiative to become closed-loop producers – that is, figuring out where waste happens and finding new uses for it.

Even the kind of waste that gets stuck on your boots: yep, we’re talking about grade-A Alberta cow poop. Powered by nearly 100-per-cent renewable energy made from feedlot cattle manure, Growing Power Hairy Hill L.P. (GPHH) will be Canada’s first Integrated bioRefinery(TM) when it goes on line next year. Located 120 kilometres northeast of Edmonton, the $125-million facility will produce electricity, fuel ethanol, fertilizer and even reusable water – all from one base ingredient: waste.

“Alberta has more than 70 per cent of Canada’s cattle feedlot capacity, and so the bioMass is right here,” explains Mike Kotelko, President of Highland Feeders Ltd.  and one of the partners in the venture.

That’s one big pile of manure, no matter which way you shovel it. One cow produces six times the waste of one human (1,200 kilograms per animal per year), and there are 5.7 million cattle in confined feeding operations in the province. Until recently, 95 per cent of all that manure ended up being applied to agricultural land as fertilizer, but dealing with the volumes has been challenging. Direct runoff can cause soil and water contamination, especially for those cattle farms next to watersheds. And peeee-yuwww: odour is a constant issue.

As operators of one of the largest feedlot operations in Canada, Mike and brother Bern Kotelko know these challenges well. They have partnered with a second brotherly duo, Evan and Shane Chrapko, who were part of the first generation of the tech boom. The Chrapkos sold their dot-com firm, DocSpace, for $811 million Cdn. in 1999, just weeks before the bubble burst. Now they’re investing in new and promising technologies that will benefit Alberta, including the venture with the Kotelkos, under the name Highmark Renewables Research L.P.

Their “waste equals opportunity” approach focuses on squeezing maximum benefit from the last and hardest of the so-called “Four Rs” – reduce, reuse, recycle and recover. The heart of the technology that converts poop to power at the Hairy Hill facility is a patented system called Integrated bioMass/waste Utilization System (IMUS(TM)). What goes in is high-solids, high-fibre organic wastes such as manure, food industry residues and municipal garbage. What comes out is bioGas, a 100-per-cent renewable substitute for natural gas comprising methane and carbon dioxide.

The bioGas is then used to generate electricity, steam and hot water to manufacture ethanol and a renewable bio-based fertilizer. At the end of the process, there is no waste. “It’s a great opportunity to close the loop by utilizing existing infrastructure and systems, and bridge to a new age of energy,” Mike Kotelko says.

None of it would have been possible without Dr. Xiaomei Li, a Chinese scientist who made Alberta her home in the 1990s. Dr. Li’s process is so revolutionary it can separate solids and liquids, and kill off pathogens, sufficiently to make the water contained in manure reusable.

Funded by a mix of more than 100 direct and indirect private investors and government support, the GPHH plant will also produce 40 million litres of fuel ethanol a year from four million bushels of locally grown, low-grade wheat. Ethanol has the advantage of being a renewable fuel and is mainly used as a bioFuel additive for gasoline. Between 2000 and 2007, global production of ethanol escalated from 17 billion to more than 52 billion litres, most of it from agriculture feedstocks such as corn and sugar cane.  [Editor's Note:  GPHH's ethanol has a near-zero CO-2 content compared to regular ethanol at 40-70 grams per MJ depending on the initial feedstock and power source; regular gasoline tips the scales at 90-93 grams of CO-2 per MJ]

“It has taken innovation, creative thinking and expertise to make this all possible,” Mike Kotelko says. “Alberta thinking at its best.”

Ten years ago, Fort McMurray-based Northland Forest Products started looking at the immense outflow of waste from their lumber processing operation as an opportunity lost. Today, the company is making money off their excess outputs – both from the woody biomass and the 30 million BTUs (British Thermal Units) of heat generated in processing at any one time.

That means exhaust from the plant is harnessed to heat its buildings and kilns; sawdust is sold to the oil patch for use in clean-up applications; shavings are sold to the agricultural sector for use in livestock bedding and wood waste from the mill (called hog fuel) is sold to the local municipality for use in sewage treatment.

“It’s an enormous shift,” observes Howard Ewashko, the company’s president. “The closer we can get to heat recovery and harnessing our waste stream, the more it helps the bottom line. We saw it as an opportunity to make a change, and when provincial funding became available, we decided to pursue it.”

With the help of a $2-million grant from the Alberta government, the company built an $8-million facility that uses an Austrian-devised thermo-chemical process that has the capability to generate both thermal and electrical power. “We have the ability to produce two megawatts of electricity at any given time should the market be there for it,” he says. That’s enough energy to power nearly 2,000 average Alberta households.

The funding was allocated through the Biorefining Commercialization and Market Development Program and the Bio-energy Infrastructure Development Program, part of the province’s plan to encourage the growth of a clean, renewable fuel industry in Alberta.

To see the potential benefits of waste-efficiency systems firsthand, Northland company representatives travelled to Europe and evaluated cutting-edge heat recovery technologies. “We made the trip before we built our heat plant and gasifier to look at what they were doing,” he says. “Europe has long contended with high fuel prices, and so the incentive to innovate to control costs is much stronger and has been around longer.”

Northland has also been in discussions with a Manitoba-based greenhouse company interested in harnessing the waste heat into a facility that would be built adjacent to the Fort McMurray plant. But the city’s tight labour pool has been a stumbling block, Ewashko says. Potential partners, such as the company from Manitoba, are worried about getting enough workers to staff their operations. “The fresh vegetables would have a ready market right here,” he says. “It’s a win-win situation, and we just need to find the right partner to make it happen.”

Recouping the investment for the facility will depend on the commodity markets and fuel prices. “What we get for our wood-waste stream fluctuates, but we could see the payback in as little as four years or as many as 12,” he says.

Alberta manufacturers are also increasingly focused on reducing waste and enhancing cost efficiency of their operations. Calgary’s Big Rock Brewery, for instance, buys its barley and wheat from Alberta farmers, then sells all of the spent grain from the brewing process back to Alberta farmers as cattle feed. It’s a way of closing the loop and making a lot of people happy all at the same time. 

In 2008, the brewery commissioned Conscious Brands to complete an environmental assessment of its operations. “One of the many recommendations from this assessment was that we implement a sustainability management team,” says Tara Nychkalo, the brewery’s communications manager. “This team has been created and tasked with reducing our environmental footprint through better energy management, smarter transportation and material consumption.”

By installing more efficient water management systems, the brewery has reduced wastewater volumes by 35 per cent, she says. Big Rock now captures, filters and reuses residual grey water for cooling and chilling, rinsing and maintenance around the brewery.

Prosit! That’s something to toast, and reason to celebrate both the environment and the bottom line.

Waste by the Numbers
• Province-wide, 40 per cent of all waste comes from industrial, commercial and institutional sectors; 33 per cent comes from residences; and 27 per cent is generated by construction and demolition.
• Alberta’s rate of municipal solid waste disposal averages about 900 kg per capita, the highest in Canada. Nova Scotia is lowest, at around 400 kg per capita.
• At least 80 per cent of material currently sent to municipal landfills can be recovered.
• About 40 per cent of municipal solid waste is organic material such as leaf and yard waste, vegetable processing wastes and table scraps.
• Cattle produce large amounts of manure, with bulls producing 42 kg/day, beef cows 37 kg/day, steers 26 kg/day, heifers 24 kg/day and calves 12 kg/day. Milk cows produce the most at 62 kg per day, about 10 per cent of their body weight.

Sources: Alberta Environment, Statistics Canada