"The tax credit will help, but we could live without it": Genencor

May 24, 2011 |

Genencor CEO Tjerk de Ruiter says, “As long as they create a mandate, the tax credit will help, but we could live without it.”

Last week, Genencor released a foundational survey on consumer attitudes towards +bio-based products” and the “bio-based” moniker, and created the Genencor Household Sustainability Index.

The full report is online today via the Biofuels Digest Community, here.

This survey, which sampled approximately 2,000 Americans and 2,000 Canadians (18 years and over) in April 2011, aims to better understand the public recognition of “biobased” as it applies to household products.

We took the opportunity to check in with Genencor CEO Tjerk de Ruiter about the survey, the future and timelines for cellulosic ethanol, and also the upcoming merger between Dupont and Danisco, in which Danisco’s Genencor subsidiary is expected to play a starring role.

The Genencor Household Sustainability Index.

BD: The Index – what inspired you to undertake the work:

TdR: Internally we always we talk about bio-based products, and how they improve sustainability. But we wanted to make sure we were not living in our own little cocoon. What do consumers think when they think about “bio-based”?

BD: Highlights from the survey?

TdR: The consumer linked “bio-based” with “sustainable”, “green”. The new message
is better recognition than we expected, but there is some skepticism on these terms. We need to help to equip consumers with information on how these products are more sustainable, making sure we are backing up with LCA [life cycle analysis] data.

BD: How can these findings be put to work?

TdR: We ourselves will never have the marketing power to influence the broad consumer market. So the question is, how can we provide our customers the tools? Certified LCA is one of those ways.

BD: What about consumer labels – like the EnergyStar labeling from EPA that has helped with energy efficiency.

TdR: USDA did a good initiative with their biopreferred seal – that initiative could play such a role. A few products already are qualifying. But we have to watch that we don’t abuse the term.

Ethanol and biofuels

BD: How did ethanol and biofuels fare in the survey?

TdR: When we looked at the survey, ethanol is getting painted in corn, and the feedback is that ethanol as one of the first ones mentioned as “made from renewable materials,” but it is not mentioned in a negative context. We are so involved in the politics, but consumers are seeing it as a positive. And we have to make sure we keep winning the argument.

BD: Will positive feelings translate into buying?

TdR: For us it confirmed that bio-based is the place to, and our efforts to qualify these products are on the right track. The consumer is looking for more products – they are sending a strong message.

Dupont, Danisco and Genencor

BD: Speaking of buying, how is the Dupont-Danisco merger going to affect Genencor?

TdR: I believe the merger will boost the business even more. We had with Danisco a committed parent. Now we have a parent that completely stakes our future with us. In this industry, it takes patience and capital and Dupont has both.

Cellulosic ethanol – still five years away?

BD: Patience – that’s been a watchword with cellulosic ethanol. Is is still five years away? Novozymes has recently been slowing down its projected timelines.

TdR: It’s definitely not five years away, but lets be realistic , it’s at least 2 years away unless you are breaking ground today. In our venture with Dupont we are looking for a site in iowa right now. We believe we have the technology now in our pilot plant in Vonore.

BD: Key challenges from now until ground breaking?

TdR: Getting biomass at the right price at the gate, that’s what will determine how soon we get this built. It is looking very positive, as we move away from a technology play to a logistics and economics play. I feel positive about it.

Mandates and tax credits

BD: There’s a tremendous amount of policy instability in Washington right now. What are the policy keys for you?

TdR: We have very good legislation with RFS2 [the Renewable Fuel Standrad]. We have to make sure those mandates are adhered to. All the legislation is in place, it is all about maintaining. What is worrisome is when people start to take things away just as we are ready.

BD: Cellulosic ethanol mandates have been waived down – how does that affect you?

TdR: The waive down is disappointing, it would create more pressure if the mandates were adhered to. That would help.

BD: Many in Washington are frustrated that all these policy supports were given, and very few gallons have been delivered.

TdR: I understand we have disappointed people in not delivering earlier [on cellulosic ethanol], but it was a tremendous challenge.

BD: The tax credits – the VEETC ethanol tax credit – is that a must-have?

TdR: From our point of view, as long as they create a mandate, the tax credit will help, but we could live without it. Ultimately we did not include that in our plan.

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