“The mindset is there, we need the technologies and to integrate them: the time is now”: Looking at Enerkem’s evolution and the rise of the circular economy

October 2, 2019 |

From Enerkem in Canada comes the news that the company has snagged outgoing Chief Technology Officer and Director of Sustainability at AkzoNobel Specialty Chemicals, Peter Nieuwenhuizen. AkzoNobel Specialty Chemicals spun out as Nouryon and now Nieuwenhuizen has spun out in to the world of emerging companies, after a 25-year run at Akzo. Nouryon, and Enerkem are currently both partners in Europe’s first advanced waste-to-chemicals facility in Rotterdam.

Why important, why important now?

Enerkem has been famed as a plaform for producing ethanol from municipal solid waste. Yet, there’s methanol as a platform. There’s also the possibility of moving from syngas to ethylene. There’s methanol to olefins, which opens up potential to go from mixed plastic waste to new plastic.

There’s a circularity in there.

Think of recycling plastic and recycling it come more. Eventually, after many uses, it can become degraded. That’s when the Enerkem process might break it into syngas and use it all over again by creating newly original plastic. And so on.

As Peter Nieuwenhuizen expressed it to the Digest, “ there’s no silver bullet, but there is a path to circularity, because we have to ask ourselves, with everything we see and hear around us, are we going to bet exclusively on oil and gas for the next 30 years, or should we be looking more at waste?”

“If you look major chemical companies like AkzoNobel,” Nieuwenhuizen added, “they are very good at a type of innovation, which is the incremental type, taking cost out. It happens that we also took out things that improved our carbon and environmental footprint, and the majors are much greener and environmentally sensisble than they were 20 years ago. But if you step into this new wave of innovation coming out of the start-ups, this wave is completely differenet and the mind-set is completely different, it’s more about leaps and bounds and risk taking than any major chemical company culture. Here at Enerkem we could be innovating at that [advanced pace] for the next 10 years.”

The transition

In short, it’s going to be difficult to make a major transition exclusively based on the major company’s culture, and the smaller companies expertise with scale. Hence, why this is an inflectino point for Enerkem, and perhaps the wider world.

For decades, the world has been hooked on cost and performance. Ethane is flowing for almost nothing and polyethylene is very cheap as a result, and Glad Warp does a very good job of being easy to use and effective as a barrier. You know the drill.

Is anything — really — changing? The world has not become disenthralled with cost or performance, but we are starting to see two mechanisms at work that have nothing to do with costs. Retailers are starting to say that they just cant be seen to be using petroleum, and governments are starting to act.

“People are screaming about the climate,” noted Nieuwenhuizen, “ and politicians and retailers really feel the pressure. You could 

feel it coming for a long time, and for some it has come too late, but you can see the inflection point, that wave. It’s important to transition to the scale of the major companies, and it is time for the start-ups to get ready. And it’s time for the majors to be ready, and over 20 years we have had time to get ready and, I know, at first it was tough. But now, at the majors, the mindset is there. Now we need the technologies and to integrate them, the the time is now

The Enerkem backstory

Enerkem produces advanced biofuels and renewable chemicals from waste. Its disruptive proprietary technology converts non-recyclable, non-compostable municipal solid waste into methanol, ethanol and other widely-used chemicals, and operates at full commercial scale in Alberta as well as an innovation centre in Quebec. 

We reported in April that Enerkem closed a new round of financing totalling C$76.3 million. The financing comes from Enerkem’s existing investors, as well as a new investor, Suncor Energy Inc. This injection of additional capital will help foster the company’s growth by continuing the development of its other projects, including in Varennes, Québec, and Rotterdam, Holland.

Suncor, one of Canada’s largest energy companies, is joining Enerkem’s shareholders, comprising Braemar Energy Ventures, Cycle Capital, Fondaction, Fonds de solidarité FTQ, Investissement Québec, National Bank of Canada, Rho Ventures, Sunkem, the Westly Group and Waste Management of Canada. In addition to its equity interest, Suncor will share technical resources to support acceleration of Enerkem’s growth.

Similarly, as part of this financing, the Government of Québec has increased its equity ownership in Enerkem by C$13.3 million through the Fonds du développement économique.

Enerkem closed another C$76.3 million in equity financing including Suncor Energy

Waste-to-chemicals project in Rotterdam: the complete story

It’s not just Enerkem and Nouryon: Shell and Air Liquide are in the mix. As we reported in March, the consortium, which has set up a dedicated joint venture company, has already undertaken extensive preparatory work, covering detailed engineering and the permitting process. It aims to take the final investment decision later in 2019 as it pursues the development work and finalizes the selection of an engineering and procurement contractor. The waste-to-chemicals project in Rotterdam will be the first of its kind in Europe to provide a sustainable solution for non-recyclable wastes, converting unrecoverable plastics and other mixed waste streams into new raw materials. The waste-to-chemicals project in Rotterdam is a prime example of how a true circular economy can be achieved by preventing the use of fossil sources for new materials, diversifying the energy mix and by making everyday products lower carbon while offering a smart, sustainable alternative to landfilling and incineration.

Shell joins Air Liquide, Nouryon in Enerkem waste-to-chemicals project in Rotterdam: the complete story

Reaction from the principals

“Peter is a seasoned leader who brings over 25 years of international experience in the chemical industry”, said Dominique Boies, Chief Executive Officer and Chief Financial Officer of Enerkem. “We are pleased to welcome him as we develop sustainable waste management processes, as well as the biofuels and green chemicals of the future.”

“I’m thrilled to be joining Enerkem at this time, and to contribute to develop its technology as a key competitive advantage at the forefront of the circular economy”, mentions Peter J. Nieuwenhuizen, Vice President, Technology Strategy & Deployment. “Enerkem’s technology has been many years in the making, and now all the lights are green to deploy the company’s technology to solve some of the world’s most pressing environmental issues, including a possible solution to plastic waste.”

 

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