Novozymes: Biofuels Digest’s 2014 5-Minute Guide

Novozymes is “the world leader in bioinnovation”. The company’s business is industrial enzymes, microorganisms, and biopharmaceutical ingredients. Our biological solutions help companies make more from less, as our solutions save energy and raw materials, and reduce waste. The result is higher quality, lower costs, lower CO2 emissions, and a better environment.

With over 700 products used in 130 countries, Novozymes’ bioinnovations improve industrial performance and safeguard the world’s resources by offering superior and sustainable solutions for tomorrow’s ever-changing marketplace. In 2013, Novozymes’ products globally reduced CO2 emissions by 52 million tons.

Novozymes offers the leading technology platform for biofuel production, and is the leading enzyme provider for ethanol enzymes in all regions where we operate.

Rankings

50 Hottest Companies in Bioenergy: #12, 2013/14
30 Hottest Companies in Renewable Chemicals: #10, 2013/14

Biofuels Digest Awards

2012 Best Project (Fermentation) Award: Beta Renewables — Crescentino, Italy

Major Investors

Novozymes A/S has two share classes: A shares and B shares. The B shares are listed on NASDAQ OMX Copenhagen under ticker code NZYM B and ID code/ISIN DK0010272129.

Type of Technologies

Novozymes’ core technology for the biofuels industry is enzymes that break down different types of feedstock into fermentable sugars for conversion into ethanol. Within this area, Novozymes develops solutions for two distinct types of ethanol technology: cellulosic ethanol and starch-based ethanol.

Novozymes cellulosic ethanol work is the largest endeavor the company has ever undertaken, with over 150 scientists dedicated to the effort. Not only is Novozymes’ developing and offering the leading enzyme solutions for cellulosic ethanol technology, but we have also expanded our research focus into optimizing the pretreatment, hydrolysis and fermentation process steps.

In 2010 Novozymes launched the first commercially viable enzyme for the cellulosic ethanol industry, Cellic Ctec2, and in February 2012 launched Cellic Ctec3 that performs 1.5X better than Ctec2.

As the world leader in bioinnovation, Novozymes produces enzymes that optimize the conversion of grains such as corn, barley, wheat and other starch raw materials into ethanol. Unrivalled in their performance and ease of use, our enzymes enable higher yields, faster throughput and lower processing costs. Our tailored solutions – including custom enzyme blends – match the specific needs of our customers’ processes for liquefaction, saccharification, fermentation enhancement, and viscosity reduction.Feedstocks:

Novozymes’ enzyme solutions provide robust performance on a wide variety of feedstocks. Cellulosic ethanol employs biomass feedstocks such as corn stover, wheat straw, sugarcane bagasse, woody residues, switchgrass, etc. For starch-based ethanol, the primary feedstocks are corn, barley, wheat, sugarcane, etc.

Products

The company’s enzyme solutions breakdown feedstock, such as corn and lignocellulosic material into sugars that can be used to produce: ethanol, biobutanol, renewable jet fuel, organic acids, biochemicals and bioplastics. These enzyme solutions include the following product families: Liquozyme, Spirizyme, Viscozyme, Provia and Cellic

Offtake partners

Some of the company’s partners in cellulosic ethanol include: Beta Renewables, Raízen, POET, ICM, GreenField Ethanol, Fiberight, Lignol, CTC, Petrobras, Inbicon, M&G, COFCO and Sinopec.

Past Milestones

In 2010, Novozymes launched Cellic CTec2, the first commercially viable enzyme for cellulosic ethanol production. A follow-up to our original Cellic CTec enzyme, CTec2 provides more than twice the performance of the original, driving the enzyme use cost down to as low as $.50 per gallon of ethanol produced.

Also in 2010, Novozymes launched Spirizyme Excel, an advanced saccharification solution that makes it possible to produce more ethanol from the same amount of corn. Spirizyme Excel converts the most difficult starch fractions, allowing producers to increase yields by more than one percent. Compared to other solutions, a typical ethanol plant can gain $1 million or more per year using the enzyme.

In 2010, Novozymes launched Cellic CTec, the company’s first commercially available enzyme that helped enable the transition from pilot to demo scale for our cellulosic ethanol partners In February 2012, the company launched Cellis Ctec3 with a 1.5X better performance than Ctec2.

In October 2012, Novozymes and Beta Renewables, a global leader in cellulosic biofuels and part of Gruppo Mossi & Ghisolfi, announced an agreement to jointly market, demonstrate and guarantee cellulosic biofuel solutions. As part of the agreement, Novozymes will acquire a 10% share in Beta Renewables, paying approximately $115 million cash for the equity, marketing fees, other intellectual property rights and milestone payments.

In June 2013, Novozymes announced the launch of new enzyme technology that can increase ethanol yield from corn by up to 5%. The technology also increases corn oil extraction by 13%, while saving 8% energy. The efficiency improvements can be achieved when two new enzymes, Spirizyme Achieve and Olexa, are used together with another Novozymes enzyme, Avantec.

Novozymes noted that the technology boosts average yields from 2.77 gallons per bushel to 2.92. By using Avantec, Olexa and Spirizyme Achieve, a standard 100 million gallon ethanol plant would save up to 1.8 million bushels (45,000 tons) of corn while maintaining the same ethanol output, and generating up to $5 million in additional profit. Despite the dip in corn usage, overall corn oil extraction would increase by 7% to 9000 tons for a standard plant, while DDGS production would dip to 282,000 tons based on lower corn inputs.

In September 2013, Novozymes announced that it has entered into a collaboration agreement with Brazil’s largest sugarcane crusher, Raízen Energia S/A. As part of the agreement, Novozymes will supply enzyme technology to Raízen’s first commercial-scale cellulosic ethanol plant in Brazil, scheduled to be operational by end 2014. The plant will be a bolt-on facility to Raízen’s Costa Pinto sugarcane mill in the state of São Paulo and will have the capacity to produce 40 million liters of cellulosic ethanol a year from sugarcane bagasse and straw. The agreement also provides for Novozymes to supply enzyme technology to Raízen’s second cellulosic ethanol plant, should such a plant be constructed.

In February 2014, Novozymes and Monsanto announced the completed closing of the The BioAg Alliance, as originally announced on December 10, 2013. Both companies will now focus on implementing the long-term strategic alliance.

The BioAg Alliance is unique in the industry, bringing together Novozymes’ commercial BioAg operations and capabilities within microbial discovery, development and production with Monsanto’s microbial discovery, advanced biology, field testing and commercial capabilities. The result will be a comprehensive research, development and commercial collaboration for sustainable microbial products to help farmers globally meet the challenge of producing more with less – for the benefit of agriculture, consumers, the environment and society at large.

Future Milestones

1) Deliver higher-performing cellulosic enzyme solutions to help ethanol plants make cellulosic ethanol cost competitive with starch based ethanol production; working with our partners in demonstrating their cellulosic ethanol technology is commercially viable.

2) Deliver the first million gallons of commercially-viable cellulosic ethanol to the world through our enzyme development and partnership efforts.

Business Model:

Novozymes supplies enzymes to the bioethanol production industry and is the global market leader. We provide the ethanol industry with the best use cost via higher performing enzymes that deliver greater yields and efficiencies to our customers’ operations as well outstanding customer service optimizing plants efficiencies. Novozymes spends 13-14 percent of its annual revenue on research and development of new innovative solutions for our customers and the industry.

For cellulosic ethanol, we have forged partnerships with the leading technology developers in the industry in order to help enable commercialization. We are well positioned to continue our legacy of being the leading enzyme supplier to this industry through our unmatched product performance and customer value offering.

Competitive Edge:

Novozymes has been the leader in starch based ethanol since the industry has taken off and we are positioned to the do the same for cellulosic based ethanol. We accomplish this through our commitment to R&D and always providing the highest performing enzymes coupled with the industry’s best technical services team. This winning combination enables our customers to have peace of mind that their plants are running optimally.

Research, or Manufacturing Partnerships or Alliances.
Novozymes is the market leader in all segments and partners with many of the industry leaders, such as POET, M&G, GreenField, ICM, Inbicon, COFCO, Sinopec, and Ceres to optimize their technology for ethanol production.

Stage 
For starch based ethanol, we are the industry leader in supplying the commercial scale bioethanol plants with enzymes. In cellulosic ethanol, we partner and supply our enzymes to several of the industry leaders who are currently at pilot and demo scale. One partner recently broke ground on the first large scale cellulosic plant, which is M&G/Chemtex. This plant was inaugurated in October 2013.

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