1. Sunflower Integrated Bioenergy Center An Alliance between the Kansas Bioscience Authority, NISTAC, and Sunflower Electric Power Corporation SIBC

2. Kansas Bioscience Authority NISTAC (National Institute for Strategic Technology Acquisition and Commercialization) A Touchstone Energy  Cooperative Sunflower Electric Power Corporation

3. NISTAC l Founded in 1994 as a nonprofit under the auspices of Kansas State University and the Kansas Technology Enterprise Corporation (KTEC) l Commercialization of intellectual property from: – Kansas State University – Corporate patent portfolio l Promote business development in Kansas and around the nation through the use of technology SIBC

4. Kansas Bioscience Authority l Created in April 2004 under the Kansas Economic Growth Act l Independent entity of the state with the authority to invest $580 million in bioscience activities l Mission to make Kansas a national leader in bioscience development and commercialization SIBC

5. Sunflower Electric l Nonprofit corporation formed in 1957 by six rural electric distribution cooperatives l Services 34 western Kansas counties with over 61,000 meter points l Actively engaged in rural development activities throughout western Kansas for many years SIBC

6. Holcomb Station 2013 Artist’s Rendering

7. Holcomb Expansion Project Total installed cost of the three plants is expected to be $3.6 billion Over a 35-year period will exceed $8 billion Construction Impact (6 year period)  3,600 jobs created (direct and induced) in Kansas  Annual payroll of more than $116 million Continuing Impact (35-year study period)  More than 400 full-time jobs (direct and induced) created in Kansas  Annual payroll of more than $24 million Studies completed by Dr. Ralph Gamble, a noted Fort Hays State University Economics professor

8. Plant Design Features Each unit built to provide minimum generation capacity of 700 MW Environmental control systems will be Best Available Control Technology  BACT is an emission limitation based on the best degree of reduction for each regulated air pollutant emitted  Results in the emission rates that are achievable and is determined on a case-by-case basis, taking into account energy, environmental and economic impacts, and other costs. Construction on eastern unit is expected to begin in mid-2007  Construction period for each plant is 42-48 months  Total construction period of 63 months

9. Sunflower Integrated Bioenergy Center l Goal is to develop a bioenergy project that will integrate a number of commercial or near commercial renewable energy technologies with the coal-based power plant located at Holcomb Station SIBC

10. Global Energy Markets SIBC

11. Dairy Anaerobic Digester Sunflower Holcomb Power Plant Biodiesel Plant Ethanol Plant Algae Reactor EthanolBiodiesel Electricity Methane Reduced Waste Streams = CO 2, NOx, SOx, Nutrient Load (Nitrogen & Phosphorus), Heat, & Waste Water Energy Products Biogas Nutrients (Nitrogen & Phosphorus) & Water Electricity Flue Gas Water Algae Solids Algae Oil Biodiesel Ethanol Wet Distillers’ Grain Waste Water Corn/Grain Sorghum Tallow Livestock Processing Manure Other Oils (Soybean etc) Thin Stillage Ammonia Methanol (Converted from Methane) Glycerol Extracted Corn Oil CO 2 Sunflower Integrated Bioenergy Center 2006 Alliance with NISTAC SIBC Patent Pending

12. Anaerobic Digester Biodiesel Plant Ethanol Plant Methane Energy Products Biogas Waste Water Tallow Livestock Processing CO 2 Livestock Processing Subsystem l Processor waste water and manure are converted to methane in the anaerobic digester. l Beef tallow is used as an oil source for the biodiesel plant. l CO 2 from the ethanol plant can be converted to dry ice for refrigeration purposes. SIBC

13. Livestock Processing l Holcomb station is in close proximity to several large processing facilities. l A significant quantity of beef tallow is produced – one processor can supply enough oil for a large biodiesel plant. l Access to tallow allows for the immediate construction of the biodiesel plant while other oil sources are scaled up. Tallow is also a low cost feedstock. l Waste water from the processing plant can create value in the form of methane, reusable water, and a nutrient source for the algae system. l Processors currently purchase CO 2 (for dry ice refrigeration) which could be supplied from the ethanol plant. SIBC

14. Dairy Anaerobic Digester Ethanol Plant Algae Reactor Methane Energy Products Biogas Algae Solids Wet Distillers’ Grain Manure Dairy Subsystem l Dairy manure and waste water are converted to methane in the anaerobic digester. l Wet distillers grain from the ethanol process and algae solids (protein residue) are used for cattle feed. SIBC

15. Dairy l Southwest Kansas is home to a growing number of large dairy operations. l Access to land, water, feed (including distillers grain), and suitable climate conditions are driving this growth. All of those conditions are present in Holcomb. l Dairies must construct manure and waste water management systems – an anaerobic digester offers additional value. SIBC

16. Dairy Anaerobic Digester Sunflower Holcomb Power Plant Ethanol Plant Algae Reactor Methane Energy Products Biogas Nutrients (Nitrogen & Phosphorus) & Water Waste Water Livestock Processing Manure Thin Stillage Ammonia Glycerol Anaerobic Digester Subsystem Biodiesel Plant l Digester processes waste water and manure from the livestock facilities and potentially glycerol from the biodiesel plant. l Bacteria in the digester produces methane which can be used by the ethanol and power plant. l Digester ammonia, nutrients (nitrogen and phosphorus), and water are used in the algae reactor and power plant. SIBC

17. Anaerobic Digester l Anaerobic digesters have been used throughout the world for many decades to process waste water and provide biogas. l Recently digesters have gained popularity because of improved economics related to natural gas. l Several of the subsystems at the Holcomb site will require waste water management – the gas generated can supplement natural gas usage. l The digester also creates valuable products such as ammonia, nutrients for the algae (nitrogen and phosphorus) and eventually water for the power plant. SIBC

18. Methane SIBC

19. Anaerobic Digester Sunflower Holcomb Power Plant Algae Reactor Electricity Methane Energy Products BiogasElectricity Flue Gas Water Ammonia Coal-based Power Plant Subsystem l Flue gas emissions from the power plant are stripped as they flow through the algae reactor creating algae oil and solids. l Ammonia from the anaerobic digester can be used for the SCR in power plant and excess methane can replace some demand for natural gas. l Excess water from algae reactor can be cleaned for electricity production. SIBC

20. Coal-based Power Plant l Holcomb station offers several resources for an integrated bioenergy facility including access to CO 2 and NOx (flue gas), land, water, rail, natural gas, and economies of scale for other integrated systems. l The generation expansion at Holcomb is a tremendous regional economic opportunity and an integrated bioenergy facility affirms Sunflower’s commitment to community development and renewable energy. l Sunflower has negotiated large and complex power plant operation and integration agreements similar to the processes required for an integrated bioenergy facility. SIBC

21. Dairy Anaerobic Digester Sunflower Holcomb Power Plant Biodiesel Plant Ethanol Plant Algae Reactor Biodiesel Energy Products Nutrients (Nitrogen & Phosphorus) & Water Flue Gas Water Algae Solids Algae Oil Biodiesel Algae Subsystem Converts C02 emissions into renewable fuels l A significant portion of the Algae is harvested from the reactor daily and is separated into Algae oil, solids, and water. l Flue gas is introduced to the bioreactor, where algae utilize CO 2, NOx and suspended nutrients from the anaerobic digester to optimize the growth. l Algae solids are used as animal feed, starch for the ethanol plant, or burned directly in the coal unit. l Algae oils are a feedstock for the biodiesel plant. SIBC

22. Algae Reactor Converts C02 emissions into renewable fuels l Microalgae is the most primitive plant form - typically one or two cells. l This simple structure allows algae to be very efficient at converting sunlight, CO 2, and nutrients into oil (for biodiesel) and starch (for ethanol). l The algae reactor is capable of utilizing the waste CO 2 and NOx in flue gas and the nutrients from livestock/processing waste to create valuable energy products. l Algae systems have been research for decades including work by the National Renewable Energy Laboratory. Production was found to be viable but most work was done when fuel prices were half of what they are today. l No large scale algae reactor is in operation today but significant investment has been made recently in conjunction with higher global energy costs. SIBC

23. Algae Reactor l Flue gas is diverted from the power plant in a manner that does not disrupt normal generation operations. l CO 2 and NOx are consumed in the bioreactor by algae through photosynthesis and other biological processes. Algae are suspended in water with nutrients from the anaerobic digester. l Algae is harvested daily and is sent through a dewatering process which may utilize flue gas as a dryer. l Algae biomass is then separated into oil (60% by weight for some algae) and solids. Those solids can be fed to livestock, burned in the power plant, or the starch may be utilized by an ethanol plant. SIBC

24. Algae SIBC

25. Dairy Anaerobic Digester Biodiesel Plant Ethanol Plant Algae Reactor EthanolMethane Energy Products Algae Solids Ethanol Wet Distillers’ Grain Corn/Grain Sorghum Livestock Processing Thin Stillage Glycerol Extracted Corn Oil CO 2 Ethanol Subsystem l Ethanol plant will consume methane gas, grain, glycerol, and algae solids. l Ethanol plant will produce ethanol, distillers grains used by the dairy, thin stillage for the anaerobic digester and extracted corn oil that will be used in the biodiesel plant. SIBC

26. Ethanol Production l Ethanol is produced by converting carbohydrates found in grain into sugar which is then converted to ethanol through fermentation. l The ethanol industry has grown rapidly due to the renewable fuels standard, the ban on MTBE, and higher oil prices. l Ethanol plants require access to land, water, grain markets, and livestock facilities for use of distillers grain. All of these are key components of the Holcomb site. l Powering the ethanol plant on over 90% renewable fuels allows the facility to receive a substantially higher tax incentive. SIBC

27. Ethanol SIBC

28. Anaerobic Digester Biodiesel Plant Ethanol Plant Algae Reactor Biodiesel Energy Products Algae Oil Biodiesel Ethanol Tallow Livestock Processing Other Oils (Soybean etc) Methanol (Converted from Methane) Glycerol Extracted Corn Oil Biodiesel Subsystem l The biodiesel plant can utilize a number of oil sources including algae oil, tallow, recovered corn oil, and other vegetable oils such as soybean. l The biodiesel plant will produce Glycerol as a by-product which can be sold (ingredient in soap and cosmetics) or processed in the anaerobic digester. SIBC

29. Biodiesel Plant l Biodiesel is a fuel that has many of the same characteristics as normal petroleum diesel including similar energy content, improved lubricity and higher flash and cloud points. l Biodiesel is derived from “cutting” triglycerides found in vegetable oils and animal fat using simple alcohol in the presence of an alkali catalyst (transesterification). l The first diesel engines were designed to run on peanut oil so that developing countries could rely on agriculture infrastructure. l Growth in the biodiesel industry will be limited by the access/cost of oil sources. Many of the vegetable oils (soy, canola, etc.) used today take many acres to grow and have food value. Algae oil may offer improved yields. SIBC

30. Biodiesel SIBC

31. Expected Benefits l Efficiencies of integration –Improved economics over stand-alone system –Water re-use –Value from waste streams –Flue gas utilization l New job creation l Additional regional economic activity l Shared human resources SIBC

32. Current Status l Formation of founding partners company l Final technology and financial partner selection l Enhanced subsystem feasibility studies –Economic –Engineering for integration –Environmental / water l Ethanol plant construction 2007 SIBC

33. Dairy Anaerobic Digester Sunflower Holcomb Power Plant Biodiesel Plant Ethanol Plant Algae Reactor EthanolBiodiesel Electricity Methane Reduced Waste Streams = CO 2, NOx, SOx, Nutrient Load (Nitrogen & Phosphorus), Heat, & Waste Water Energy Products Biogas Nutrients (Nitrogen & Phosphorus) & Water Electricity Flue Gas Water Algae Solids Algae Oil Biodiesel Ethanol Wet Distillers’ Grain Waste Water Corn/Grain Sorghum Tallow Livestock Processing Manure Other Oils (Soybean etc) Thin Stillage Ammonia Methanol (Converted from Methane) Glycerol Extracted Corn Oil CO 2 Sunflower Integrated Bioenergy Center 2006 Alliance with NISTAC SIBC Patent Pending