Pannonia Ethanol's New Bioethanol Plant, Hungary

Ethanol Europe Renewables' subsidiary, Pannonia Ethanol, has constructed a €152m ($214m) corn to ethanol plant in Dunaföldvár town in central Hungary. The agro-grain plant site is located along the Danube river, approximately 50 miles (80.46km) south of Budapest.

The facility processes 575,000t of corn to produce approximately 240 million litres (50 million gallons) of bioethanol a year. It also produces roughly 175,000t of dried distillers grains with soluble (DDGS). DDGS is a rich protein feed for livestock and is a partial replacement for the soy bean meal.

Construction work at the site began in August 2010, and upon its completion in 2012 it was the first world-class ethanol facility in Hungary. The facility created 80 direct jobs and more than 600 indirect jobs. It also created more than 250 jobs during the construction phase.

The plant currently supports more than 2,000 direct and indirect jobs in the region.

Pannonia Ethanol announced further expansion of the plant in November 2016, in order to reduce costs and increase the production capacity. The expansion will be funded by a credit facility to be provided by a consortium of Hungarian banks, including the Budapest Bank, Hungarian Export-Import Bank, K&H Bank and Raiffeisen Bank.

Owners / financing

The project is developed and owned by Pannonia Ethanol, and was partially funded by the US Export-Import Bank (Ex-Im Bank), with approximately $60m also provided by the Overseas Private Investment Corporation (OPIC). In April 2011, Cordiant Capital issued $17m mezzanine funding towards completion of the plant construction.

"The plant is developed and owned by Pannonia Ethanol."

Design and construction of the bioethanol plant

The new facility is built on a 12ha greenfield site located on the west bank of the Danube river, and is the first ethanol producing facility of its kind in Hungary to use the latest technologies and processes. Cargill Hungary's technologically advanced grain storage facility is located adjacent to the site.

The site is also in close proximity to the grain growing region, with easy accessibility via roads for corn transport, a train station for ethanol delivery and river accessibility for DDGS loading to barges.

A dry mill plant and power co-generation plant are part of the facility. The co-generation plant produces 15GWh of electricity, which is approximately 40% of the site's total electricity requirement. The bioethanol plant consumes roughly 152,000m³ of natural gas a day.

The associated infrastructure includes storage facilities for 18.4 million litres of ethanol and 20 days storage capacity facilities for DDGS at the Dunaföldvár rail station. Rail transport is provided by Transpetrol.

The plant is designed to allow for further expansion and the eventual doubling of the production capacity.

Contractors involved

Ethanol Europe entered a turnkey fixed price construction agreement with Pannonia Ethanol part-owner Fagen in 2008.

Fagen was responsible for the overall design, engineering, procurement and construction (EPC) of the plant. ICM was the process technology provider and partner of Fagen.


Corn is sourced from within an approximately 100km vicinity of the plant, and delivered by rail and trucks in order to reduce the transportation costs. The 10,000t grain storage facility is operated by Cargill Hungary and transfers the shipped grains to the ethanol plant.

The large storage structures facilitate 10 days of operations. The feedstock is transferred to the ethanol plant by conveyor system.

Processing of corn to bioethanol

The grains are passed through hammer mills for preparing flour and mixed with enzymes and water in the slurry tanks. The mixture is then pumped and stored in the liquefaction tanks.

"In 2008, Ethanol Europe entered into a turnkey fixed-price construction agreement with Fagen."

Enzymes in the slurry break down the grain starch into fermentable sugars. The produced mash is added with yeast and allowed to ferment for a few hours. The fermentation process produces carbon dioxide, beer containing solids and alcohol.

The beer is pumped into three distillation columns. The distillation separates solid residues and ethanol from the beer, which is 190-proof. The residues are further processed to produce the co-product distillers grains.

The 5% water containing hydrous ethanol is dehydrated to produce 200-proof ethanol. It is added with small amount of gasoline and stored in the terminals for transport.

The water and distiller grains obtained from the distillation columns are separated by centrifugation. The produced thin slurry is further recycled to reduce the water consumption in the ethanol production process.

Wet distillers grains are passed through dryers for obtaining the livestock feed. Carbon dioxide produced during the fermentation process is also captured and marketed.


Hungary has high-quality resources of corn, which allowed the company to choose Dunaföldvár as the preferred location for the bioethanol project. The Hungarian government also provided Special State Supported Project status to the project for its environmental and economic benefits.

The project is expected to create a stable and long-term market to corn farmers in Hungary, and also increase the rural incomes.

The bioethanol produced from the plant reduces greenhouse gas emissions by 57%, when compared to fossil fuels according to 2017 statistics. This is in accordance to the EU Renewable Energy Directive, which aims to use at least 10% of the transpiration fuel produced from renewable sources by 2020.