Business Grads Offer Energy Solution With Ethanol
Few people would view hungry cows in rural Colorado and today’s energy crisis as the perfect business opportunity, but three GW alumni do.
Daron Coates, MBA ’96, Paul Orentas, MBA ’96, and Grant Hall, BS ’97, are cofounders and equal principals of LiquidMaize LLC, a biofuels company launched in 2004 to produce ethanol.
LiquidMaize is different from other ethanol producers. The company caters to small and medium-sized customers who can’t capture the attention of larger energy producers and are thus underserved. Rural America is their market niche.
While other companies typically produce more than 50 million gallons a year (Mmgy), LiquidMaize’s first plant, in Lamar, Colo., will only produce 11 Mmgy. Besides ethanol, the Lamar plant also will produce distillers grain for livestock. The plant is being built adjacent to a cattle feed lot housing up to 24,000 cattle and within trucking distance of area fuel terminals.
“The benefits of LiquidMaize depend on who you are,” Coates explains. “If you own a cattle feed lot, you have a dedicated supply of a high-protein product for your cattle.
“If you are a refiner, you get ethanol in areas that have more demand than fuel. This happens because most ethanol is shipped by rail, and railroads don’t always go to fuel terminals. We will truck the ethanol directly to the terminals. We can also store the ethanol at our plant and provide just-in-time delivery.”
The plant itself will be energy efficient—using Colorado’s abundant wind power. Even cow manure from the feed lot will play a role, generating heat and steam for the distillation process.
LiquidMaize efficiency extends to allocation of its founders’ talents. Coates is an expert in the real-world use of alternate and biofuel energy; he is adept at selling LiquidMaize concepts to decision makers and finance markets. Orentas is the scientist who knows how to exploit new and emerging energy technologies. Hall is the ranching expert and has a long family history in ranching.
The three men met while students at GW in the mid-1990s. Coates and Orentas were in the executive MBA program and Hall was earning a bachelor’s degree in international business when their paths crossed.
They began working together at Team Systems International, a company Coates formed in 1995 to provide consulting and development of energy-efficient projects. In 1998, as the alternate energy market grew, Orentas identified bioenergy as an opportunity. Their business model called for small, centralized generation of bioenergy for specific customers in specific areas. This led to the founding of LiquidMaize as a separate company.
Team Systems also evolved—becoming ThinkBox Group LLC. Coates, Orentas, and Hall serve respectively as principal/strategic planning, managing member/research and analysis, and principal/project development.
ThinkBox develops, builds and owns decentralized clean energy projects and serves as an energy management consulting group. One project is a strategic energy retrofit plan for the Washington, D.C., housing authority.
“We developed the concept, analyzed their 10,000 utility accounts—uncovering more than $4 million in billing errors along the way—then packaged the program documents to get HUD to approve its largest self-performing, energy-efficiency project,” Coates says. “The project was recently funded. The D.C. Housing Authority is doing the design, development, and construction in-house, and we are providing program management.”
ThinkBox also just completed a biofuel analysis for the Commonwealth of Virginia and is exploring the use of algae to treat municipal waste water and produce biofuel—a technology Coates says offers “massive” opportunities.
Back in Lamar, LiquidMaize is poised to build an ethanol plant that uses the entire corn kernel to produce ethanol and distillers grain more efficiently than earlier plants. Plant efficiency relates to current discussions about using corn for fuel, rather than food, says Orentas, LiquidMaize’s technology expert.
“In the 1970s and even into the 1990s, the efficiency of ethanol plants was very low,” Orentas explains. “Production efficiency is much higher today. A bushel of corn can yield a maximum of 2.8 gallons of ethanol. Modern plants today, like ours, produce 2.7 gallons per bushel.
“Many people also think corn used for ethanol is the kind used for human consumption—it’s not. Ethanol uses feed corn that is only fed to livestock. However, one byproduct of ethanol production is a highly nutritious food for livestock. Nothing from the corn is wasted.”
As ethanol technology matures, Orentas says LiquidMaize will embrace more efficient biofuel sources, such as from other plants, or even algae.
Until that day comes, LiquidMaize will ease America’s energy crunch by producing corn-based ethanol, and the cows in Colorado will get fat faster with cheaper feed.