Eamonn Byrne, a tillage and livestock farmer’s son from Wexford, and Jim Galvin, a suckler farmer’s son from Cork, are two men who are mixing it with some of the largest energy companies in the world.

In just a few years, Galvin and Byrne have built up their company, Lakeview Energy, into one of the main players in the ethanol business in both America and on the global stage.

Last month, the Irish Farmers Journal visited Lakeview’s ethanol plant in Cochoston, eastern Ohio, to learn more about a sector that continues to divide opinion on a range of topics, from energy efficiency to food security. The Ohioan plant is a recent acquisition, and is the second plant under the Lakeview umbrella. The other plant is located in Merrill, Iowa.

Byrne said the working relationship between the former college classmates is close, fruitful and familiar.

“We were in class together, we graduated together and now we work together,” he said. “We know each other pretty well at this stage. We’ve a few stories on each other which means we have to stay in business together!

“We have about 90 staff working in the two plants between admin, trading and management. We also have a base in Chicago, which is the base for commodity trading in America.”

Byrne moved to the United States in the late 1990s to work with Devenish in Minnesota and has been stationed that side of the Atlantic ever since. He is now a green card holder with an Irish wife and US-born children.

For Galvin, the move to the US came much more recently. He was working with construction company Fleming. Between 2006 and 2007, the company decided to enter the renewables space. Its first purchase was an ethanol pant in Iowa. Galvin, who was stationed in Ireland at the time, began working between home and the States developing the business.

However, with the collapse of the construction sector in Ireland, so too came the collapse of the Fleming enterprise. Galvin led a buyout of the renewables section of the business, which included the plant in Iowa as well as a wind farm in North Dakota.

Ever since the 1970s, the ethanol sector and farming have cohabited. The sector has grown and developed as America has moved to wanting to secure its fuel and energy future. Since 2005, America has become the largest producer of ethanol in the world.

Now the sector in America has just over 200 plants. Almost all have farmer shareholdings, and produce in the region of 14.5bn gallons (54.8bn litres) of ethanol for blending with gasoline (petrol) to run in cars.

The Energy Independence and Security Act of 2007, signed by former US president George W Bush, requires annual renewable fuel usage to increase to 36bn gallons (136bn litres) by 2022. However, with corn-based ethanol production having a capacity of 15bn gallons (56.7bn litres) as a result of the same legislation, the further production of ethanol will have to be derived from other forms, mainly cellulosic feedstock.

Galvin and Byrne buy corn directly from farmers or from larger traders known as elevators. The corn, through fermentation and distillation, is turned into ethanol fuel. The fuel they produce is transported to fuel companies to be added into petrol or sent by train to Texas for export.

Galvin and Byrne export fuel to South America, Canada and elsewhere. At one stage, they were the sixth-largest exporter of ethanol from America to Europe, but a 9% import levy on ethanol in Europe has restricted shipping to that continent.

Between their two plants in Ohio and Iowa, they produce 110m gallons of ethanol from 1m tonnes of corn. As well the ethanol, they also produce 300,000t of distillers’ grain and 5m gallons of corn oil. “It’s about adding value to every bushel of corn that comes into the yard,” Galvin explains. “If we were to solely rely on just making ethanol from corn, we’d be losing out. You have to diversify, you have to move to where the market is and what the market wants.”

Two bumper corn crops are aiding the sector, as it is able to use more corn. According to America’s department of agriculture, corn crop yields are expected to reach 14.4bn bushels (366m tonnes) with an average per acre yield of 171.7 bushels (4.28t). Current corn prices of $3.34/bushel (€102/t) are under half of what corn cost three years ago.

As corn is a traded commodity, it leaves the likes of Galvin and Byrne susceptible to spikes in prices, which has knock-on effects for their business. However, they both predict that the ethanol sector should remain lucrative for “at least five years”.

The ethanol business faces pressure from the oil industry. Big oil, while ironically being a growing shareholder in the sector, is pumping hundreds of millions of dollars into lobbying politicians on Capitol Hill in Washington DC to stem the growth of ethanol. A major fossil fuel company losing market share to ethanol would be bad for business and they are working hard to stop this happening.

Perceptions have developed, largely through messaging from anti-ethanol campaigners, that ethanol is harmful for cars and is not as efficient as petrol. Byrne admits that fighting against these can be tough but they believe in what they are doing. “We don’t have near their resources,” Byrne said. “We’re fighting, not only against them, but the perception that has been created that ethanol damages your car and stuff, but I think we’re getting there.”

So with the ethanol business winning an energy race against big oil, albeit slowly, and prices projected to remain strong for as long as five years, what keeps Byrne and Galvin awake at night?

“Corn prices,” they answer in unison. Galvin explains: “You always bring the phone with you to see how the markets are going, see what’s happening to the price. You’re not as much chained to the prices as much as you have to be. Even the slightest change or move in a trend can make a big difference. You’re always switched on.”

Indeed they are – the two plants are open 365 days a year.

What is ethanol fuel?

Ethanol, the same produce that is used in alcohol, is a growing player in the global fuel sector. Corn grown by farmers is brought to refinery plants where it is fermented and turned into carbon dioxide and ethanol.

The product is then transferred to petrol companies, where it is blended into the petrol. By law in America, every car must be able to use a 10% ethanol, 90% petrol mix, known as E10. A higher ethanol mix, known as E15, is currently cleared for use in just under 20 states, with the sector hoping it will spread.

Ethanol fuel is slightly less efficient than traditional petrol, but it is considerably cheaper, in some cases by $0.85 (€0.65) a gallon.