The organizers of the third national conference on New Ideas in Educating a Workforce in Renewable Energy and Energy Efficiency are pleased to announce that the preliminary program is now available.
China is planning a massive expansion of its renewable energy generation capacity, with a strategy to match Europe by 2020 by producing 20% of its total energy requirements from renewables.
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By John Addison. Scientists know how to make fuel from prairie grasses growing on marginal land. They know how to make fuel from fast growing trees with root systems that extend 25 feet into the ground, sequestering carbon emissions and enriching the soil. They even know how to make fuel from algae. They do all this in their labs every day. The problem is making cellulosic and algal fuel in large quantities at costs that compete with fuels from petroleum such as gasoline, diesel, and jet fuel.
This is my second article (previous article) from the 31st Symposium on Biotechnology for Fuels and Chemicals sponsored by NREL. 800 global bioscientists gathered in San Francisco to share their research and showcase their progress.
Their progress with biofuels from cellulosic sources is important. Some corn ethanol plants have closed. Once promising corporations, such as VeraSun, are now bankrupt. Lifecycle greenhouse gas emissions for fuel-from-food are being scrutinized. Industry would benefit from biomass that can be grown at much higher yields per acre than corn. Industries such as agriculture, wood, and paper would benefit from making money from waste and from having added revenue sources.
At the conference, Verenium (VRNM) shared their progress. In Jennings, Louisiana, they are producing 1.4 million gallons per year of cellulosic ethanol. The fuel can be mixed up to 10 percent with our current gasoline, saving us from needing almost 1.4 million gallons of foreign oil each year. Some might be delivered as E85. Instead of using corn, which requires high inputs of energy, nitrogen, fertilizer, and water to produce, Verenium is using a crop that produces eight times the energy required to process it – energy cane, a hybrid of sugar cane optimized as a fuel source not a food source.
Sugarcane and energy cane are part of Brazil’s energy independence, being the source of over 40 percent of their fuel. Now energy cane is being grown in some of the more tropical places in the United States. At a time when project financing is difficult, major partners are critical to financing larger commercial plants. In a joint-venture with BP, Verenium plans to build a 36 million gallon per year plant in Florida.
Dr. Stuart Thomas with DuPont Danisco Cellulosic Ethanol (DD, DNSCY.PK) outlined their plans to bring a 20 million gallon per year plant on line in 2012. They are evaluating non-food feedstocks with much higher yields per acre than corn, including switchgrass and sorghum. DuPont Danisco anticipates reaching parity with $60 to $100/barrel oil by 2015. The pilot plant will be in Tennessee which is providing $70 million of funding for ethanol from switchgrass.
The long-term potential for biofuels may not be in ethanol, but in renewable gasoline, biodiesel, bio-jet fuel, and biocrude. All contain more energy than ethanol, which only delivers 84,000 BTU/gallon. Gasoline delivers 114,000; biodiesel 120,000.
With better microbes and fewer process steps, Chief scientist Dr. Steve del Cardayre with LS9, presented plans to produce industry standard biodiesel from energy cane. The plant should be able to compete with oil at today’s prices by also producing other valuable outputs, such as chemicals which can be used to make detergents. Synthetic biology competitor, Amyris, is moving even faster in building process plants to convert energy cane into renewable hydrocarbons and bio-jet fuel.
Indeed, creating multiple products from a process plant is likely to be critical to having a profitable industry. Oil refining is profitable because fractional distillation creates many valuable products at one refiner:
· Naphtha which can be processed into chemicals and plastics
· Gasoline
· Jet fuel
· Diesel
· Heavy oils which can be processed into lubricants and asphalt
Gevo will build plants with mass efficiency of over 40 percent that can produce multiple products including:
· Bio-jet fuel
· Bio-diesel
· Isobutanol for other products
Gevo sees opportunities to buy existing moth-balled ethanol plants and retrofit for $30 million per plant, a fraction of building a cellulosic plant from scratch. Gevo’s yeast fermentation process produces heat and steam which would be valuable if co-located with industrial processes that benefit from combined heat and power.
By converting wood waste to next generation fuel, Mascoma has a significant potential to co-locate with existing paper mills and wood processing operations. The same is true for Range Fuels.
Enerkem is being paid to covert municipal solid waste into fuel as it targets 2011 to bring live a 9.6 million gallon per year plant in Edmonton, Canada, and a 20 million gallon per year plant in Pontotoc, Mississippi.
Beyond the cellulosic sources for fuel, covered in this article, is the potential for fuel from algae. A future article will examine the near-term challenges and long-term potential of algal fuel.
As this Symposium took place in California, in Copenhagen, Greenpeace protesters stopped all buses because they use biofuel from food sources. In the future, they may welcome biofuel from wood and waste sources as an alternative to gasoline from tar sands and jet fuel from coal.
This December, the leaders of the world will gather in Copenhagen, Denmark, to develop a framework for a more promising sustainable future. In Denmark they will be able to visit a new cellulosic ethanol plant developed by Inbicon. The feedstock will be an agricultural waste product – wheat straw. The plant will process 24 metric tons per day of wheat straw, ten times more than a demonstration plant that Inbicon only a few years ago. The plant will be more efficient and come closer to competing with refined oil because the operation will have three products creating three revenue streams:
1. 5.4 million liters ethanol year
2. 8,250 MT biofuel which will displace some coal used by a power plant
3. 11,250 MT of molasses which will be used to feed cattle
Can such operations displace all our need for petroleum? No, but in five years we will see commercial scale next generation biofuel operations. If oil is selling for $100 dollar per barrel, then cellulosic biofuels may lower our cost of fuel. In ten years, all such operations could displace 20 percent of our petroleum use and represent an important step towards energy independence.
Cellulosic ethanol is not the only sustainable solution that world leaders will see in Copenhagen. They will see at least 40 percent of the population commuting on bicycles, demonstrating an immediate and very cost-effective way to reduce our need for oil. Many delegates will ride on electric light-rail from the airport and notice the wind farms that deliver the electricity. Some will ride in electric cars that further demonstrate transportation that uses renewable energy.
Next generation biofuels promise to be part of a portfolio of solutions to our current climate and energy problems.
John Addison publishes the Clean Fleet Report and speaks at conferences. He is the author of the new book – Save Gas, Save the Planet – now selling at Amazon and other booksellers.
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I just spent an amazing year at the National Renewable Energy Laboratory (NREL), but have no start-ups to show for it (yet).
A year ago, I was asked by Kleiner Perkins to be the first Entrepreneur in Residence (EIR) at NREL. As a person who has been into energy and environmental technologies since gradeschool and as an early cleantech investor, it was an opportunity of a lifetime to become the first NREL EIR. It was a fantastic time spent with some of the best cleantech researchers in the world. I felt like a kid in a candy store. I tremendously added to my depth and breadth of cleantech history and knowledge.
The program itself was a grand experiment that I commend the Department of Energy for attempting. DOE’s calculus was that if they inserted a serial entrepreneur/investor backed by a brand-named VC firm into a lab that magic would happen and that an innovation would turn immediately into a company. At worst, DOE would learn a lot about what it and its labs need to do better to in order to accelerate ideas to market.
In the 11 months that I had the privilege to work inside NREL, I met with more than 300 researchers, identified around 30 promising technologies that I thought could reach commercial potential over the next several years, and honed in on 3 technologies that showed imminent promise. Unfortunately, the EIR program was timed too short to reach its full potential and to get the first one of these ideas set up as a company.
When building a new program into a research institution, timing is critically important. Based on my experience running the Austin Clean Energy Incubator at The University of Texas, it took almost 11 months to start my first company. In 18 months, I had helped start 5 companies. In total, these companies raised more than $200 million, but none surpassed KP’s investment hurdle.
When I agreed to become NREL’s EIR, I set the expectation with DOE, NREL, and KP that starting a company that KP would back within one year should not be expected. While there are a tremendous number of opportunities for commercialization at NREL, they need to temporally match a VC firm’s thesis, meet its perceived portfolio needs, or surpass its hurdle for innovation. Given enough time, many of the 30 technologies described above could be built into companies, but not necessarily into ones KP would fund over the period of the EIR Program.
A more reasonable expectation for all was to use this program to begin developing long-term relationships with VCs and start-ups that helped the lab and DOE develop better tools and processes. If successful, this could help NREL deliver more companies or successful collaborations for the entire industry. With this approach in mind, there were many things learned by all parties that could benefit the entire venture capital and start-up industry. Here is what I learned…
First, NREL truly is “The National Renewable Energy Lab”. There is more breadth and depth of renewable energy and energy efficiency knowledge at NREL than any other institution on the planet. This alone is worth the price of admission. Unfortunately, the admission price has never been posted and there have only been secret alley entrances with secured doors to gain access to the lab. The lesson here is that new interfaces need to be developed by the lab to better expose its collective knowledge and translate it to the marketplace more effectively (thus EIR and other programs).
Second, the value in NREL is not just in its innovation, but more importantly in the value it can deliver across the life cycle of a technology…
- Innovation – Yes, NREL has a great pool of researchers and ideas. They also have a network of other labs and universities they collaborate with (MIT, Stanford, University of Colorado, etc.). They will also soon be the hub of all DOE renewable energy intellectual property by managing DOE’s IP Portal.
- Acceleration – NREL’s experience allows them to solve critical issues for external technologies and companies. Success stories abound from NREL helping First Solar, Uni-Solar, Clipper Wind, and many others. Identifying new ways to open up NREL to solve critical issues in start-ups is critical to the VC industry.
- Analysis – NREL has a large division that does market, techno-economic, scaling, integration, policy, and plant design analysis. This primarily is developed for DOE and Congress (which really does not take advantage of this tremendous asset), but needs to be exposed to the financial services and venture capital sectors. I would encourage any thesis-driven VC firm or investment bank to review the work that has already been delivered by NREL.
- Testing / Validation – NREL provides the service of testing all flavors or renewable energy, storage, transportation, building, and energy efficiency technologies. They even integrate multiple technologies as systems and perform accelerated testing. NREL’s validation not only helps get products designed into projects, it also provides critical feedback for future development.
- Deployment – NREL has a cities and states program that helps advise on local policies, design parameters, and integrated solutions. NREL will increasingly be involved in regional test and implementation centers that will help scale technologies into cities and integrated pilot facilities.
Finally, NREL will only get better; now is the time to begin forging long-term relationships with them. With additional funding, increased DOE support, stronger linkage to national priorities, and new management focused on commercialization and market needs, NREL will deliver increasing value to the cleantech community. By becoming more intertwined with our imminent national priorities and community needs, the lab will increase its “NRELevance” in our nation’s day-to-day existence.
So, what next’s next for the NREL EIR? Over the short run, I will help deliver a national energy efficiency initiative focused on schools with the help of NREL. I will also continue supporting NREL as an entrepreneur/investor and as an advocate of the lab’s potential. I will also continue nurturing the many wonderful relationships I began forging through this program. And, yes, there will be start-ups forthcoming, unfortunately not within the short period of the EIR Program.
Thanks again to DOE, NREL, and KP for inviting me into this unique and invaluable experience. I hope that my time at NREL has made a difference there. If NREL is successful with its new management team and tools, then the entire cleantech community and nation will benefit.
Joel Serface served as NREL’s first Entrepreneur in Residence with Kleiner Perkins Caufield & Byers. As an investor and entrepreneur, Joel has planted cleantech seeds in Massachusetts, California, Texas, and now Colorado. Since 2000, Joel has started or invested into more than 20 cleantech companies with 5 liquidity events so far and has catalyzed the formation of numerous supporting cleantech institutions and regional and national policy initiatives.
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