Ethanol Extraction: Explained

Why Ethanol Extraction is More Costly for Business When Scaling

Though ethanol is a common extraction method in the hemp industry, it is undoubtedly a costlier method for an extraction company to utilize. Even the direct cost of each solvent is drastically different. For example, a pound of food grade ethanol when purchased in bulk is $4.71/lb at current price whereas a pound of food grade CO₂ when purchased in bulk is about $0.04/lb at current price. Apart from this immediate cost, the overall process is shockingly more expensive as well.

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Ethanol extraction is an extraction process that is typically run at low temperatures. The ethanol is cooled to below -20 degrees celsius before it’s introduced to hemp biomass. Cooling the ethanol reduces the amount of extracted chlorophyll and waxes. Accounting for the energy required to cool down the ethanol to such low temperatures and then evaporate after use, the overall energy cost for ethanol extraction is nearly 3 to 6 times the price of using a CO₂ extraction process. Though this is a major factor in overall operating expenses, it is not the primary overhead cost of concern for a manufacturer who has chosen ethanol as their extraction method.

This extraction method requires an exorbitant amount of ethanol to be used for each pound of hemp. In reality, approximately 1 to 1.5 gallons of ethanol has to be used per pound of dry hemp biomass to extract the desired cannabinoids. Hemp is considered to be a very absorbent biomass material. Because of this, the ethanol used must saturate the plant material in order for an effective extraction to take place. For this reason a large volume of ethanol is needed to extract CBD out of hemp. With ethanol being $4.71/lb at current price, this creates a tremendous cost to extract with ethanol.

Solvent Recovery

Perhaps the key cost driver for ethanol extraction lies in solvent recovery. Though many ethanol extraction equipment businesses supply centrifuges or presses to get rid of the leftover ethanol in the biomass, even the best equipment will provide only a 90 to 95% recovery of their ethanol.

This creates a 5% to 10% loss in ethanol which is a massive cost driver for ethanol extraction. By way of example, suppose you wanted to process 1000 lb of hemp. If ethanol is your choice solvent for extraction, you will need 1000 gallons of ethanol to extract your desired cannabinoids. At a cost of roughly $16-$33/gallon of food grade ethanol, the upfront cost will range from $16,000 to $33,000. Even if you recovered 90% of the ethanol, the total loss will be $1,600 – $3,300 for each 1000 lbs extracted. If you are a manufacturer extracting 1000 lbs every day, this would be a daily operational cost for your business. In comparison, the same extraction method for the equivalent 1000 lbs of hemp using CO₂ as a solvent would only result in roughly $70 per day – thousands of dollars difference compared to ethanol solvent loss.

Other Hidden Costs

Aside from these drastic cost differences due to energy and solvent loss, there are numerous hidden costs when using an ethanolic extraction method including insurance, facilities, testing and solvent reuse costs. It is, by far, more financially viable to decrease or eliminate these costs by using a CO₂ extraction method instead.