Maximising sugar mill revenue in Mackay

Maximising sugar mill revenue in Mackay

Mackay Sugar has been making sugar for 130 years and generating electricity for about 100 years.

Key points
  • The sugar mills burn bagasse (waste sugarcane fibre) to produce steam and electricity, and turn molasses into ethanol.
  • Up to 6 million tonnes of cane is processed every year in Mackay. Of that, 1.8 million tonnes of bagasse fibre is left over from the milling process.
  • 150,000 tonnes of bagasse per year is enough to operate the Racecourse refinery for most of the non-crushing part of the year.

Milling sugar in Mackay and north Queensland

Mackay Sugar owns three sugar mills in the Mackay area, and the Mossman mill in North Queensland. Their factories have made sugar for 130 years and have generated electricity for about 100 years.Cane is delivered to the mill via cane railway (and some by road to rail points), and processed within 12 hours.

After the cane stalks are crushed and juice extracted, the juice is processed, crystallised, boiled and turned into sugar.

Up to 6 million tonnes of cane are processed every year in Mackay. 1.8 million tonnes of bagasse fibre is left over from the milling process.

Cane stalks are crushed and the juice extracted.

Burning waste fibre for steam and electricity

The fibre becomes the fuel to be burnt in the boilers to produce steam.Some of the steam goes to run the machinery and process the juice. Other steam goes to turbines in the powerhouse. Those turbines turn generators, which generate electricity. Some electricity is used on site and the rest goes out into the local grid.

This process is called cogeneration.

About 26 megawatts of electricity—a third of Mackay’s average needs—are exported to the grid continuously.

This earns Mackay Sugar some money as well as saving on electricity. The initial investment was $120 million and the build was completed this year.

The surplus of fibre from all Mackay Sugar mills is stockpiled for use later. Racecourse mill can store up to 100,000 tonnes, and Marian mill up to 44,000 tonnes.

150,000 tonnes of bagasse per year is sufficient to operate the Racecourse refinery for most of the non-crushing part of the year, and is relatively unique in the sugar industry.

Bagasse is burnt to produce steam in the boilers.

144,000 tonnes of bagasse can be stored at Racecourse Mill.

Bagasse is renewable, green energy

Mackay Sugar uses large amounts of energy producing sugar, most of which is steam energy (not electricity).“We are so fortunate that we have essentially free fuel that can provide that energy and it is renewable,” says John Hodgson, business development manager at the Racecourse mill.

The revenue from sugar essentially ‘picks up’ the costs of the growing and transport of the product to the mill, so the fuel is relatively low cost for cogeneration or feedstock for a biomass refinery.

John Hodgson, business development manager, Mackay Sugar

Other benefits of the cogeneration plant at Mackay Sugar are:

  • extra revenue for the company, which is a benefit to the shareholders
  • many extra jobs during construction
  • extra jobs during operation
  • important diversification to remain viable long term
  • abatement of approximately 180,000 tonnes of greenhouse gases a year via the displacement of fossil fuel–generated electricity in Queensland
  • significant contribution to Australia’s renewable energy target of 20% by 2020.

“Really, sugar cane is just like a big solar panel,” John says. “It is growing out there and it absorbs solar energy and carbon dioxide to make biomass, which we then use to produce sugar and electricity.”

“When we burn it, it releases carbon dioxide which is equivalent to the amount that’s absorbed by the crop that grows the following year, so it’s a neutral carbon cycle. And that’s why the electricity is considered green or renewable electricity.”

Historically there was no market for steam or other energy, so the mill was less efficient than it is now. However, John says that how steam and electricity are used in the mill is changing.

“I think that’s where the gains will be made: becoming more efficient with the way we use the energy in the factory, making more bagasse available for other products,” he says.

Making more bioenergy from sugar and bagasse

Apart from sugar and cogeneration, there are other bioenergy products that can be produced from sugar cane.This is important for Mackay Sugar, who are very interested in diversifying their business.“Most of the major competitors in Brazil, Thailand and India have diversified into other products. We believe that we have got to do the same to remain internationally competitive long term, and we have developed a 20-year diversification plan.”

The boiler
  • Mackay Sugar hosts the QUT Mackay Renewable Biocommodities Pilot Plant onsite. This facility tests the best way to turn plant material into ethanol and other products, from pre-treatment through to fermentation. The plant mostly uses bagasse from Racecourse mill. It’s quite leading edge technology, John says. “It is going to take quite a large research effort to get that to full commercial scale, but we want to be there when it happens.” If the technology becomes commercially viable, Mackay Sugar would direct a lot of bagasse to that process.
  • The University of Queensland are undertaking the Queensland Sustainable Aviation Fuel Initiative in partnership with Mackay Sugar and others to study the conversion of sugar to aviation fuel. It is an advanced technique and not proven as commercial viable yet, but holds opportunity, John says.
  • Molasses— cane impurities and sugar that cannot be recovered in crystal form—can also be fermented using a certain bacteria or yeast to produce ethanol. A large percentage of the 180,000 tonnes of molasses typically made in Mackay per year is converted to ethanol at Sarina. Much of that ethanol is typically blended and used in e10 fuel blends. “So when you fill up with an e10 blend, it could well be ethanol that has come from sugar cane in this area,” John says.

So how does Mackay Sugar decide what to go into? John describes looking at the resources available to decide what would fit best with the business. The resources include land, mill infrastructure, wastewater facilities, and steam and electricity energy.

“It’s all about long-term viability and maximising the revenue that we can get from the crop that comes into the mill,” says John.

“Sugar production will always be our core business, but we are happy to have the bio-refinery onsite and financially support research into that area. We don’t want be left behind.”

Infrastructure is vital for bioenergy operations.

Government support is key for renewable energy projects

In 2009, Mackay Sugar secured a grant through the Queensland renewable energy fund of $9 million, which was an important precursor for the $120 million cogeneration project.

They were also granted $9.1 million in 2012 from the Commonwealth Government through the Clean Technology Program for an efficiency project at Marian mill. That allowed Mackay Sugar to bring more bagasse to the Racecourse mill to reduce carbon emissions and improve the cogeneration project.

“I think government support for renewable energy projects is so important. It was crucial for getting these projects over the line,” John says.


John Hodgson, Business Development Manager, Mackay Sugar Limited
Phone: 07 4953 8382, 0427 538 286