Newsmaker interview: Mascoma president Colin South

Mascoma is having a pretty darn good week. Having secured a high-profile but undisclosed investment from General Motors last week, the company yesterday announced a $10 million third-round investment from Marathon Oil, bringing its third-round total to $61 million. The company has a “one-step” cellulosic ethanol process that has attracted investors such as Kleiner, Perkins and Khosla Ventures, as industry attention begins to turn from cellulosic experimentation to demonstration-scale and commercial-scale deployment. Mascoma president Colin South spoke to Biofuels Digest yesterday in a Newsmaker interview.

BD: Aside from the obvious financial benefits, tell what you feel the GM and Marathon Oil investments will mean for Mascoma?

South: It’s a good fit for us. First was GM, which was validation for us, and a validation of fuel ethanol that they are continuing to invest. With Marathon, there are lots of opportunities, because Marathon has a good a knowledge of ethanol distribution as it is possible to have. They are a premium player, with 1.2 billion gallons per year blending capability.

BD: GM is heavily invested in flex-fuel technology and E85, but the take-up has been slow. What do you see as the future there and how will Mascoma play in that space?

South: Ethanol is just a fraction of US gasoline supply, at 5 percent or so, and the demand drivers for E85 are relatively modest. It’s recognized that cellulosic ethanol is a part of

BD: A number of promising cellulosic technologies have run into problems in scale up. Are you concerned about a potential fall-off in yield as you scale-up from pilot scale?

South: We’re familiar with the challenges of scale up, and the challenges in particular in controlling both operating costs and capital costs. Our focus on a one-step process, we believe, means that we are more likely to have fewer capital cost issues and good economies of scale.

BD: Are you concerned that the food vs fuel debate will have an impact?

South: Naturally we’re concerned if the food vs fuel issue has a hangover effect on cellulosic ethanol development. We can see the reasons for public sentiment. It’s a complex topic, obviously. But the impact of ethanol is exceedingly positive.

BD: How do you see Mascoma expanding; is licensing in your future?

South: Ultimately, the value of the technology will be maximized by deploying it as rapidly as possible. So we would pursue both an ownership and licensing model, with a range of ownership and licensing options. But for now, we are keeping the company very focused on our expansion to demonstration-scale.

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