Abstract: A system and process for producing ethanol and biogas. An incoming feedstock and water is directed to a preparation unit that frees sugar from the feedstock. The feedstock is directed to a fermenter that ferments the sugar to produce a beer that includes ethanol and feedstock. The beer is directed to a distillation unit which separates the ethanol from the feedstock and produces ethanol and whole stillage. The stillage derived is direct to an anaerobic membrane bioreactor unit. The stillage is subjected to anaerobic digestion in the anaerobic digester and this produces mixed liquor that includes suspended solids. Mixed liquor including the suspended solids is directed to the membrane separation unit which filters the suspended solids and produces a concentrated reject (retentate) stream and a backset permeate stream. The backset permeate stream is then mixed with the incoming feedstock.