The Company Nobody Wants to Admit they Call

The employees of Parallel Products have turned the old adage inside out. To them,  one man’s trash is another man’s… ethanol?

The Louisville, Ky-based company turns discarded beverages that didn’t quite work out — either in the co-packer’s facility or on-shelf — into the desired, industrial-grade ethanol by distillation.

Despite the whiff of failure that might accompany pouring of hundreds of gallons of a company’s beverage down the drain, Parallel Products’ CEO, Gene Kiesel insists the company is actually a boon to beverage companies.

“The beverage industry is always trying to avoid making mistakes,” says Kiesel.

Case in point: Four Loko, the “energy malternative” that spent last fall drawing fire from regulators and the media before it was ordered to reformulate its products minus the caffeine. As part of its new PR offensive, the company advertised its use of Parallel Products to destroy and recycle the old Four Loko before re-introducing its new, caffeine-free products.

For the beverage and cosmetics industries, Parallel Products is a trash man and a transformer. Somewhat ironically housed in old distilleries, Parallel Product’s facilities in Kentucky and California are the final resting place of many beverages, both alcohol and otherwise.

Unlike Four Loko, which made a point of showing the public it was getting rid of its old product, most beverage companies won’t tell you they are working with Parallel Products (After all, no beverage company has ever launched a bad line extension or had product go bad on-shelf, right?) But despite what the marketing team for a beverage company might tell you, those in charge of operations know when to call Parallel Products, whether their drinks are victims of a fickle market or are simply bad batches, if they were harmed in natural disasters, issued with labeling mistakes or went “off” due to poor inventory management.

Whatever the reason, the drinks are first transported to one of Parallel Product’s Kentucky and California facilities, where their packages are broken open. Employees then ferment the non-alcoholic beverages with yeast, and their sugars are turned into what is essentially 190 proof grain alcohol. That liquor isn’t for human consumption, however, and it’s further processed to a pure 200 proof (100 percent alcohol) for use as a gasoline additive.  By the time the company is done, all that is left of what was once a bottle of, say, a too-sweet iced tea, has been reduced to what is essentially alcohol and rPET (recycled PET).

Part of Parallel Products’ expertise is in taking different kinds of products and breaking them down. Since the drinks that arrive in the company’s facilities range from diet drinks to corn syrup-infused confections, the process must be reformulated for every batch.

Alcoholic beverages must also be put through the same distillation process to coax a purer alcohol from the mix via evaporation. The company also adds gasoline to the final product before it leaves the facility to make human consumption impossible.

“It can’t go off-site as a grain alcohol,” Kiesel says.

But it’s not just beverages Parallel Products re-uses. In the Northeast bottle bill states, empty beverage bottles are recycled as well.  Throughout the northeast PET bottles are brought to their Massachusetts facility to be sorted into different colors of plastic and then baled or flaked.

Parallel Products gets paid both for breaking down the old beverages – thereby saving its customers the cost of traditional disposal solutions, like landfills – and also for selling the ethanol and recycled packaging, both of which have the extra advantage of being re-used products that have been diverted from the waste stream.

“Parallel Products’ value is created by providing secure destruction and recycling services to the beverage, health and beauty and pharmaceutical industries,” Kiesel said. ” The materials we recover are diverted from the waste stream and used in products ranging from paper goods to advanced renewable biofuels.  These practices reduce a company’s overall waste generation and their potential environmental liabilities.  In most cases it also saves them money.”

While the prices of the commodities re-sold by Parallel Products fluctuates, the cost of the process by which they make the commodities does not. At times, when demand for gas or recycled plastic is low, Parallel Products has to be creative in how they stretch their money.  The company continually studies how to “add value” to the recovered commodity streams, according to Kiesel, who said the continuous improvement process has led to a number of innovations and an increased focus on the use of the company’s recycling capabilities.

“What we used to do is essentially bale it,” rather than try to sell the raw materials, Kiesel said. But in the end, Parallel Products’ success, like that of any recycling company, is tied to the overall economy.

“If the volume of material falls off, then I have to spread less over a fixed cost,” says Kiesel. “Consumers cut back, beverage companies cut back, then we have to cut back.”