Will Professor Plum do it in Brazil with a Magic Bug, or Miss Scarlet in India with a Magic Tree, or Colonel Mustard in Mississippi with a Magic Pyrolysis Machine?
In the family board game Clue, players spend their time guessing which suspect committed the fateful deed, in which room using which implement – and in the world of biofuels we do a lot of the same guessing about the strategic partners, feedstocks, products and locations.
The fateful deed in biofuels, today as always, is to make sustainable biofuels at scale and at commercially viable costs.
In years past, D1 Oils was going to do it in Africa with jatropha biodiesel. Poet was going to do it in South Dakota with corn stover ethanol. And so on. It seemed during 2009’s “summer of algae” that the entire western world was going to do it in a closed photobioreactor with high-yielding Nannochloropsis or Chlamydomonas.
At World Biofuels Markets 2011 in Rotterdam, the overwhelmingly remarkable impression is the ramp-up in the quality and quantity of strategic investment and off-take partners. Closely followed by the rise of renewable chemicals, and the background chatter over the best hotels in Sao Paulo. As Codexis’ Vonnie Estes put it in Rotterdam, “when you take a flight to Sao Paulo these days, you feel as if you know half the people on the plane.”
Chasing sugarfields and oilfields
What are they chasing? The sugarfields, of course, just as a hundred years ago the race was on (and remains so today) for oil and gas fields.
Which makes sense, since the global oil & gas exploration industry is really just a series of extractive raids on long-forgotten, naturally-occurring, underground biofuels tank farms.
Those biofuels tank farms are generally described as oil & gas reserves, because of our penchant for describing them in the fossil fuel industry for what they are, as opposed to the biofuels industry, where we describe them according to how they are made, or what from. In biofuels, we would describe a chocolate chip cookie as a flour and egg-based pyrolysis play.
But all that oil & gas? They are biofuels down there – just not the kind made by Amyris, Gevo or Solazyme.
Recently as a species, we have figured out that we are burning oil & gas a heck of a lot faster than Nature makes it. Consequently, we have one of three problems, depending on your point of view. We are running out, paying too much, or paying too much to the wrong people.
The exploration division dives into genetic code
So, onto modern biofuels, as opposed to ancient ones. In this case, we have launched a series of extractive raids on the heretofore-unknown, naturally-occurring, genetic codes of plants and living organisms.
Now, hard at work harvesting and optimizing those codes and metabolic pathways, to see if we can grow sugars and carbohydrates faster, and convert them to hydrocarbons a heck of a lot faster. And then refine them into the usual products for the usual companies at the usual prices.
In short, a slew of miracles designed to ensure business as usual. Ironic. We are transforming the sourcing of energy, in order to avoid transforming the society that uses them right back into the Middle Ages whencefrom we emerged via the wood-burning steam engine.
At World Biofuels Markets this week, the state-of-the-art in that race against our fate went on annual display, from vast industrial fermenters, to catalytic converters, to enzymes and one-celled bioreactors you can only see in a microscope.
Voices from the annual gathering of the biofuels tribe
Andrew Owens, CEO, Greenergy, said: “The biofuels industry suffers from overstimulation. The biofuels industry has emerged, out of government policy, about ten years faster than it would have emerged anyway. But with all the government stimulation since the mid-2000s, the industry suffers from overcapacity.”
Alan Shaw, CEO, Codexis, “There’s a lag, a dangerous lag, between the promises and the realities of biofuels technologies. The whole sector feel out of favor – look in Washington, where Secretary of Energy Steve Chu just wants to talk about electrons, because of promises about advanced technologies that were far from ready. Look at Range Fuels, for example, a huge embarrassment.”
Phil New, CEO, BP Biofuels: “In Brazilian market, provided investors are making a real contribution – those investors are welcome. The opportunity there is huge. But right now, expansion has halted. There’s an inability of many traditional investors to access capital, and a significant round of consolidation is occurring. The problem in Brazil is not overheating but underheating.
Segetis CEO Atul Thakrar (on his company’s line of renewable chemicals): “We’ve had 100 customer engagements in the past year, and we are moving into delivery mode.”
Jim Woodger, Honeywell’s UOP EU manager for renewable energy & chemicals: “With our renewable jet fuels, they are sexy and the interest is high. But with our power and fuels made from pyrolysis, we’re seeing even more altitude. It’s a fully commercial technology, with a sustainability strategy in place, the price is right, and anyone can take it on board. In the case of green power, we densify the wood, convert it to oil, and then that oil can be economically transported to where the power is needed, and generated via traditional technologies. It’s better than the grid for so many regions, it’s post-grid.”
The Temper at WBM
The temper? Generally bullish on technologies, commercial prospects. Finance continues to be uncertain for smaller players. Generally pessimistic about the possibilities for stable, technology-neutral government policy that will drive winners across the finish line, faster.
As for feedstocks? Pyrolysis – bullish, where renewable fuels and power mandates drive markets. Elsewhere, for unmandated markets? We hear an awful lot about journey to the actual Brazil, and the journey towards the prospective low-cost cellulosic sugars. With high sugar prices, that dictates slower growth for biofuels, but as Codexis’ Alan Shaw points out, “why all the rush to build out technologies, when all the elements aren’t quite there?”
Stimulation or over-stimulation. That’s a topic we may well hear a lot more about this year, as governments in the EU, US and elsewhere take aim at designing mandates that replace fossil fuels at the right pace – so that we can transform the energy platform so thoroughly that we can get right back to business as usual.