Saturday, March 27, 2010

Biofuels to Green Chemicals: Seeking Sustainable Profit

The technology is pretty straightforward. LS9 uses any sugar source (though initially it will use sugar cane due to the favorable economics and logistics of sugarcane compared to cellulosic sugars) and feeds genetically modified E. coli bacteria (the same kind found in our guts that helps digest sugars into energy) a combination of sugar, nutrients, methanol, and enzymes in a low-heat environment _Greentechmedia

LS9 is the south San Francisco bioenergy company that produces ASTM quality diesel from E. Coli. The company has made some progress in 2010 already that is worth looking at.

1. It closed a $25 million equity round with investor Chevron Ventures

2. It signed a memorandum of understanding with Proctor & Gamble to produce green surfactant chemicals

3. In February LS9 purchased a 10 acre demo production plant in Florida that is capable of producing  50,000 to 100,000 gallons of diesel (a year?) for a mere $2 million in a bankruptcy sale

4.  The demo plant is due to be up and running by mid 2010, and the company will be working to try to convert the plant to commercial scale by 2011, if feasible.

5.  There is a possibility that the company can scale up to a production of 10 to 12 million gallons of diesel per year by 2012, tentatively.

Source _ Greentechmedia

In summary, LS9 is hoping to reach commercial production levels within 2 years -- about 8 years sooner than Al Fin predicts that microbial fuels will begin to make an impact on energy markets.  Can  they do it?

LS9 is only one of dozens of well financed microbial fuels companies, racing to supply global fuel markets with commercial micro-biofuels.

LS9's foray into "green chemicals" may actually bring it its first real profits.  In fact, the green chemistry arena is receiving considerable interest and investment.
Genomatica, a company that scuttled biofuel ambitions in favor of full-time chemical production, has just raised $15 million in a third round of funding (PDF) to make the industrial chemical business at large more sustainable. It says this financing should be enough to build its own demonstration plant before breaking into full-scale commercial production.

Much like LS9, Synthetic Genomics, and Codexis — companies pursuing biofuel strategies in addition to chemicals — Genomatica’s core business is the microbe it engineered to convert sustainable feedstocks (corn, switchgrass, sugar cane, biomass) into fuels and chemicals. The company, which uses sugar as its primary feedstock, says its strain of e.coli has reached a level of efficiency and speed that makes production of green products cost competitive with petroleum.

Genomatica’s number one product, 1,4-butanediol (BDO), is incredibly versatile — a key ingredient in durable polymers used in clothing, cars and electronics, as well as solvents. The global BDO market, which hit 1.25 million tons last year, represents a $4 billion opportunity, the company says. Until now, all of this BDO has been produced using petroleum. It’s a ripe area for change. _GreenVentureBeat

The name of the game in business is making a profit. It you find that your first product is taking longer to get to market than you thought, try to find another product that you can get up and running sooner -- perhaps even at a greater profit than your first idea.

The Obama Pelosi regime is making the US a bad place to start a new business -- or to keep a pre-existing business running and employing people. Unless US voters start to wake up very soon, expect more of the "enterprises of the future" to begin sprouting up overseas.

Previously published at Al Fin

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