A model of efficiency

When Ken Grossman founded Sierra Nevada Brewing Co. 28 years ago, he had one goal in mind: to produce the finest ales and lagers possible.

As the company’s success shows, he’s done that. Sierra Nevada, which began as a tiny microbrewery, is now the 10th-largest brewery in the United States, despite the fact that Grossman never advertises his products, relying instead on word of mouth about their quality.

Lately he’s expanded his initial goal somewhat. He still wants to produce the finest ales and lagers possible, but he also wants to do so in the most sustainable, energy-efficient way possible. He’s now taking his dedication to operating the brewery in environment-friendly ways a step further.

The technologies and systems Sierra Nevada has employed to make the brewery as efficient as possible are among the most comprehensive and innovative that can be found anywhere. Nowhere is that more evident than in the four 250-watt direct fuel cell power plants the company purchased on Dec. 15, following a year-long cooperative trial period. It is one of the largest fuel cell installations in the country, and the one megawatt of power it generates meets most of the brewery’s demand.

Fuel cells are complicated machines, and direct fuel cells even more so. During a recent phone interview, Grossman tried to explain the process in layman’s terms: “Gas contains hydrogen, which [gas] is acquired from our wastewater treatment system; the hydrogen is then turned into electricity. … Our goal is to feed fuel cells as much carbon-neutral gas as we can supply.”

The company’s Web site (www.sierranevada.com) carries a more detailed explanation: Sierra Nevada’s direct fuel cells are unlike most fuel cell generators in that they do not require that hydrogen gas be provided as a fuel source. Instead they separate hydrogen from either natural gas or the gas produced in wastewater treatment ("bio-gas"), then combine it with oxygen from the air to produce electricity, heat and water—and virtually no pollution. At the brewery, the heat is recovered and used to heat water for brewing.

Sierra Nevada for several years has had its own wastewater treatment plant that generates methane gas in the process. This gas is now being used to power the fuel cells.

The only drawback to fuel cell technology is its price, Grossman said. “It’s cutting-edge technology, so it’s still quite expensive.”

Sierra Nevada purchased the units for an estimated $5 million, including installation, said Joe Heinzmann, the Northern California sales rep for manufacturer FuelCell Energy, which is based in Danbury, Conn. But the deal came with a number of sweeteners, including a financial incentive established by the U.S. Energy Policy Act of 2005 that provides a tax credit of up to $1,000 per kilowatt of alternative power generated. For Sierra Nevada, that totals out to $1 million, reducing the $5 million cost to $4 million.

Heinzmann said there were additional incentives that further reduced the overall cost of the units but couldn’t specify the end cost because of policies prohibiting him from doing so.

In any event, the units are saving money every day by doubling the efficiency of the company’s power system. “Grossman’s system is running at 65 percent efficiency as compared to the 30 percent efficiency he would be running at if he depended on the power grid,” Heinzmann explained. “He’s also cutting greenhouse gasses in half by doing what he does at the brewery.”

“As you become a bigger company it is more economically viable to incorporate a technology such as this into operations,” Grossman said. “Every day there are more units installed in California because they are very efficient, but they’re expensive.”

Companies across the country have purchased FuelCell Energy units, including Gills Onions, in Oxnard, the largest year-round grower and processor of fresh-cut onions, Yale University and two Sheraton hotels in New Jersey.

“Basically, any business that has a day-round electrical and heat use can benefit from these systems,” Heinzmann said. “These fuel cells are emissions-free and very quiet, with no moving parts.”

The addition of the fuel cells builds on a tradition of sustainable stewardship at Sierra Nevada. For example, the company has long had an extensive recycling program and has received the Waste Reduction Awards Program, or WRAP, award every year since 2000. In 2005 it diverted 384,300 pounds of cardboard, 391,370 pounds of glass and 22,360 pounds of office paper.

It also recycles its spent brewing materials by providing feed for dairy and beef cows through Chico State University. Surplus spent yeast is used as a nutritional supplement for cows, and the compost from the cow manure is used as fertilizer for Sierra Nevada’s onsite 3-acre experimental hop field.

The company has also taken extensive steps to minimize energy usage (by retrofitting fixtures with electronic ballast lights and motion sensors, for example) and water use, which is now only half as much as most breweries. It was also one of the first regional breweries to install a vapor condenser to recover waste steam, and it utilizes plant heat exchangers to recover energy. It recently completed a modernization of its boiler systems to utilize cutting-edge technology with online oxygen sensors and variable-speed blowers to increase energy efficiency and minimize any air emissions. In addition, stack-heat recovery equipment has been installed.

The brewery is in the process of installing a system to recover the carbon dioxide produced during fermentation. The new system will allow it to recover and recycle most of this gas for use around the brewery and during the bottle-filling process.

There’s more: The company expects to break ground in early 2007 on a project that will cover three acres of land on the east side of the brewery with solar panels. The panels will produce 500 kilowatts of electricity, Grossman said.

“We’re also in discussion phases with Chico State and UC Davis to take the brewery’s waste yeast and produce a natural plastic,” he added.

Operating an ecologically clean and efficient brewery may not have been Grossman’s main focus in 1978, when he began building his brewery, but today it’s a central part of Sierra Nevada’s mission. Grossman said he wants nothing less than to ensure environmentally conscious actions in all aspects of the brewery’s operations.