Sustaining Momentum with Karen Hoskin
In this episode, we are talking about sustainability of distilleries including energy efficiency and utilizing sustainable materials. The interview is Karen Hoskin of Montanya Distillers in Crested Butte, Colorado and we talk about how she has been able to apply sustainable concepts to her distillery.
The easiest way to start off talking about sustainability is to look at water usage. This isn’t applicable to every part of the country for instance in places where water is abundant you will spend a lot more money on electricity to cool the water and move it around your distillery than you would by pulling it out of the ground and letting it run back to the river or stream. For the rest of the country, water is a precious resource and is quite expensive. Where that breakeven point depends on how expensive the water is and how expensive the power is as a good rule of thumb if your cost per kWh is less than 10 times the cost of your water and sewer cost per gallon then you are better off cooling and reusing your water.
An example of this comes from a distillery in the middle of the country. They are fairly large so they have a 5 MMBTU boiler and once they are done with their heat up they are using about 1 MMBTU/HR (about a 5,000 gallon still) to distill which requires about 850 MBTU of cooling through their condenser. To generate this cooling, we need about 22 GPM of ground temperature (50°F) water to enter the condenser so over the six hours they’ll be distilling they will use 7,920 gallons of water which is equivalent to a 70-ton chiller which would cost about $53K in their area. In order to see if recycling the water is efficient we need to evaluate their savings first off, the 7,920 gallons of water costs them $0.003 per gallon and sewer costs them $0.005 per gallon so the water usage will cost them $63.36/day. The energy to run the chiller is about $4.536/hour or about $0.06 per kW/hr (7.5x the water cost) so running the chiller saves them $6.024/hr or $36.37/distillation. In order to pay off the chiller with the savings, they will need to distill 1,466.35 times. This may seem like a lot but if you’re distilling once per day it will only take 4.36 years on the 20-year life of your chiller, if you are distilling three times per day it will only be 1.45 years.
Of course, that assumes that you can get the money for free which is never the case. If we assume 8% interest on that $53K then it will take us 6.44 (I said 8-1/3 years on the show for some reason) years to pay off the chiller and interest. This means that on a 20-year lifespan the chiller will earn the distillery $176K after paying for itself. I am discounting maintenance here but you get the picture. With three distillations per day, the payback period drops to 1.62 years and your profit on the investment increases to $698K which isn’t too bad on a $53K investment. If you are looking at an expansion it is worth looking at your water usage rates and determining if you can save some water and some money. There is, of course, the practical consideration of increasing you expansion costs by $53K and sometimes making money down the road doesn’t work if you can’t afford it today.
Thermal sustainability is a major concern in all distilleries. We spend a lot of time heating up things only to cool them back down. This is wasteful of the energy that we spend heating up the liquid and of the energy we spend cooling down the liquid and of course, that wasted energy in both directions is money wasted too. One of the easiest ways to conserve this energy is to use one batch that needs cooling to dump its heat into a batch that needs heating. Stillage coming out of the still needs to be cooled from 200 to 140 before it can be dumped down the drain while the incoming wash needs to be heated from 70 to 170 before distillation can begin or our mash needs to be cooled from 140 to 90 before we can filter it and we need to heat up the next mash’s water from 60 to 170 for our strike water. You can also see this in Cognac still where the lyne arm passes through the next batch of wash on its way to the condenser so you get some pre-cooling of the distillate and the wash charges the still at a higher temperature. There is always something that needs to be heated and something that needs to be cool in most distilleries even if it’s just water for CIP. Look at your distillery process and see what you can exchange with to make your process more efficient. In our wash stillage example above we have 83 MBTU that need to be added to our wash charge and 42 MBTU that needs to be removed from our stillage while we can only exchange heat until they are the same temperature we can generally meet in the middle and get our stillage down to 135 and have our wash ready to distill in half the time as normal which will also make the distillery more time efficient.
Like we talked about in out still design episode another way to be thermally efficient than transferring heat is to make sure that the heat we put into our vessels actually goes to heating what we want and not our rooms. An uninsulated copper still (200-gallon) can radiate 43 MBTU/hr during heat up or 30% of the energy that is being put into it. This is not only costing additional heat up time but additional cost for your product. Insulating your stills is important even when they are from major manufacturers and if you just hate the look the $0.16/hour you save can buy you a pretty copper jacket in three years.
One thing that is commonly pointed out to me if that all of the heat exchanges require either space to store the hot liquid that is being created or a continuous process. What are small distillers with a discontinuous process to do? My answer is to create a hot water loop. We can run a 1-2” loop of pipe around the distillery and insulate it. This loop should be insulated. It can then be used as the heat exchange medium for what ever processes you need. If the water is too hot because you’ve been dumping a lot of heat into the loop and not using much then it can be partially dumped and filled with hot water if on the other hand, it’s too cold to say pull from it as strike water we can run a heat exchanger off the boiler to get the water to the desired temperature. Due to the small size of the loop (19 gallons on my smallest one), not a lot of heat can be stored in there but there is very low cost for the equipment and some savings is better than none.
Recycling is another great source of sustainability for distilleries. The glass that is used in the tasting rooms of distilleries is a great place to start with recycling. This has the biggest impact on you low costs spirits. If your $20 rum is sold in a $3 bottle and it costs you $10 all in to make that vodka then saving 30% of your costs can really help your bottom line. Make sure that your servers are careful with the bottles after they are empty so that they don’t get broken or chipped and then the bottles need to be cleaned prior to adding back to your bottling line. We found that an industrial dish washer did a great job with our rum. Even if you spend $1 per bottle getting them back into shape and inspecting the bottles for any defects or cloudiness prior to cleaning this can be a great way buy less glass particularly if the tasting room is a major source of income. If you are unable to have a tasting room or it’s not practical to slow your servers down so the glass stays in good shape then another good source of recycling is a bottle buy back program. We offered $3 off a customer’s next purchase when they brought back their last bottle especially on our cheaper spirits this enabled us to be cost competitive with even major brands and helped us sell larger volumes while increasing or margin on those products. You’ll need to evaluate the discount specific to your distillery and then looks at the ratio of usable bottles that are returned and the cost of bringing them back into good enough shape to reuse to make the program work for you.
Barrels are another source of easy recycling since they are usable in one form or other until the end. For a distillery buying new barrels and using them once they can be sold to another distillery or reused internally once the barrels are done for you (typically 3-4 uses) then they can be sold to a brewery if they are still liquid tight, if not they can be cut in half and sold as planters or my favorite use is to break them into chips for BBQing a tri-tip or other smoking purposes. This also creates an alternative revenue stream for the distillery.
Another fun alternative revenue stream involves a second TTB license as an ethanol fuel distillery the good news is that beyond a second permit it doesn’t take more work. The heads that are produced in your operations make great fireplace fuel. So you can sell your heads to people who are looking for things to burn in their ethanol fireplace. If you don’t want to bother with the license you can also set up your tasting room with an ethanol fireplace and burn your heads there for some nice non-polluting ambiance. Ethanol/methanol burn very cleanly so they are a greener source of tasting room fire then wood and in fact don’t require a flue in most jurisdictions. If you are selling your heads the distilleries I’ve seen do it successfully also sold the ethanol fireplaces to build the market for their fuel just be careful that you keep demand for the heads lower than your production since you’ll make less money off of this then you would by selling good booze.
The last easy source of recycling for most distilleries is their spent grain, potatoes and fruit. Most distilleries try to give this away to their local farmers to use as feed and when that’s available it works really well. A more interesting use case, that isn’t applicable to everyone. Is creating biogas fuel. Basically, the spend grain in placed in a wet compost silo and then hooded so that the decomposition is gas tight. The mix of bacteria that east the grain the second time excrete methane instead of carbon dioxide. The methane can be pulled off of the top of the silo and then burned in a generator to create steam or electricity. Fairly large volumes of waste are needed and it needs to be consistent so that you don’t have to start the process over each time you have a batch of waste. Also, these need to be permitted through you local jurisdiction and typically power authority too particularly if you’re going to be selling back extra electricity generated. These are also not inexpensive to set up both due to creating the correct conditions in compost (mostly additional heat if the silo is buried) and creating a good generator set up. In the long term depending on how large your waste stream is your entire distillery could be off the grid or at least a net positive seller. There will also be a compost output from the silo that can be sold to farmers as well.
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Mentioned in this Episode:
Montanya Rum: www.montanyarum.com