Green Tech

Algae may ultimately be the preferred plant for making biofuels and other petrochemical replacements, but high costs have kept it from making a commercial impact to date.

Seattle-area start-up Bionavitas on Tuesday disclosed a technique, using pencil-shaped rods, to bring more light to algae to stimulate growth and, potentially, improve the economics of algae farming.

The Light Immersion Technology uses acrylic rods to bring light deeper into a pool of growing algae to maximize growth.

(Credit: Bionavitas)

The acrylic rods--called Light Immersion Technology--penetrate the surface of a pool of algae to bring light deeper into the pool. Bionavitas said the rod addresses one of the main barriers to algae as an all-purpose feedstock and boosts productivity 10 times compared to existing methods.

The 3-year-old company, which has been funded by angel investors until now, is in the process of negotiating to raise a series A round that CEO and co-founder Michael Weaver anticipates will be tens of millions of dollars. That money will be used to build a biorefinery and a pilot plant for making biofuel from algae, he said.

"There are a lot of companies developing processes for growing algae. But there's a fundamental flaw to all those. You quickly become light-constrained, which is why you don't have massive growth," he said. "So it's all well and good to modify genes or find a special strain, but if you can't grow a large mass, you got nothing."

For making biofuels in an outdoor pond, the rods float on the surface and bring sunlight in. The rods are shaped so that incoming light is reflected internally until it reaches the bottom and can penetrate out.

Bionavitas also intends to make algae oil for nutraceuticals, which offer higher margins than biofuels. Later this year, it's planning to build an indoor closed bioreactor in Redmond, Wash., which will use dozens of light rods on the surface of a vat of algae. Instead of sunlight, the company intends to use red and blue LED lights, which will flicker to save on energy costs, Weaver said.

Algae grower Bionavitas' Light Immersion Technology uses acrylic rods to reflect light into algae pools.

(Credit: Bionavitas)

In addition to biofuels and nutraceuticals, Bionavitas intends to sell equipment to use algae for bioremediation, such as removing toxic substances from waste water, Weaver said.

Challenges to commercialization
Weaver believes that Bionavitas' light rods address a challenge in extracting a high yield from algae strains. But there still remain significant technical and economic challenges to competitively priced algae biofuels.

Algae harvesting, which involves drying algae and recycling water, can be manual and expensive. In its first pilot project, algae farmer GreenFuel Technologies found that harvesting added to its costs substantially, leading to a product redesign.

Bionativas intends to license technology from other companies that are developing equipment specifically for harvesting.

Funding for pilot biofuel or manufacturing facilities has become particularly difficult as investors have exited the green-tech business or become more conservative in betting on new technologies.

In solar, for example, some companies have decided to focus more on selling equipment rather than building solar power generating facilities themselves.

Weaver said the strategy at Bionavitas is to build its own refineries and to sell equipment. The company, which already has customers, intends to sell its bioreactors for both nutraceuticals and bioremediation this year.

"I would much rather have someone with a stronger balance sheet than mine pay for the capital cost for a biofuels plant," he said. "That's why there are partnerships with established companies to go big."

Amyris Biotechnologies on Wednesday announced the opening of a pilot facility in Emeryville, Calif., that turns sugar cane into diesel fuel through genetically designed microbes.

The company is at the forefront of a commercial movement to use biotechnology to convert plants into fuels that resemble petroleum-based hydrocarbons.

Amyris' technique is to genetically engineer a yeast that can metabolize sugar into the desired molecules. Its first effort was to develop a malaria vaccine, which it continues to do, and it has since developed a focus on renewable fuels.

(Credit: Amyris Fuels)

"We're engineering the yeast, reprogramming it from making alcohols to making hydrocarbons," CEO John Melo said. "We started with E. coli (bacteria), which is what many other companies are doing, but we moved to yeast because we discovered that it was more scalable."

The company has also modified yeasts to produce chemicals; a sugar-derived jet fuel is planned for in about three years as well.

Through a partnership, Amyris plans are to produce biodiesel from sugar cane at commercial scale in Brazil by the middle of 2010. Brazil is one of the world's largest producers of ethanol, using sugar cane as a feedstock.

Amyris' biodiesel can be blended at up to 50 percent concentration with petroleum diesel, higher than most biodiesel today, which means that it can be pumped through existing pipelines. Environmentally, Amyris' "renewable diesel" has lower carbon emissions than petrodiesel and burns cleaner, Melo said.

Amyris has set up a distribution subsidiary and intends to sell its biodiesel to fleet operators, such as Wal-Mart Stores and FedEx.

Melo said the economic slowdown has forced the company to shelve its plans to go public next year.

It does expect to raise some form of capital in the next two years, either through venture funding or strategic partners, he said. The company expects revenue to increase rapidly next year, to more than $100 million, he added.

GreenFuel Technologies, a closely watched algae start-up, has hired a new CEO to place interim CEO Bob Metcalfe.

Simon Upfill-Brown will join the company in mid-July from Haltermann Custom Processing, where he was CEO of the chemical manufacturing firm. He was general manager of Haltermann Dow after Dow Chemical bought the company in 2001 until it was spun out this year as a separate company.

Incoming GreenFuel Technologies CEO Simon Upfill-Brown.

(Credit: GreenFuel Technologies)

In a statement, Upfill-Brown said "algae has come of age."

"By developing and scaling our algae farming technologies, we aim to play a huge role in solving the world's energy problems: mitigating CO2 emissions and producing renewable fuels, while adding to feed and food supplies rather than reducing them," he said.

GreenFuel Technologies is one of the first in a wave of companies trying to commercialize algae-based fuel.

It has bioreactors that use large amounts of carbon dioxide--from a power plant or other large emitter--and sunlight to grow algae. The algae is then harvested and then turned into liquid fuel, like biodiesel, or burned for electricity.

The company ran into troubles last year when its pilot test at utility Arizona Public Service did not produce fuel as cost-effectively as anticipated.

It trimmed down its staff and replaced its CEO, putting Ethernet co-inventor Metcalfe--now a partner at venture capital firm Polaris Ventures--in as interim CEO.

Last month, the company said it completed a C round of venture funding and has landed an undisclosed customer for its algae farming technology.

In an interview, Metcalfe said that GreenFuel has a few projects in the works, some of which could be announced in a few weeks.

"We are in project mode now. These are development and scaling projects with partners who want to have an algae farm next to a power plant, a cement plant, or an ethanol plant," he said.

One project in Europe is already under way, although its partner does not want it to be disclosed publicly yet.

One in Phoenix with Arizona Public Service would be much bigger and more serious than its initial demonstration facility, he said.

In addition, GreenFuel Technologies has developed a completely new design for its bioreactors that breaks with the glass tubes and plastic bags used in its tests, Metcalfe said.

Instead, the latest product resembles a green house. But because it's designed to be filled with flue gasses, it's closed off from people.

"We're hoping to quadruple the productivity per square meter," he said, adding that the glass tube design was too expensive and that harvesting algae from the second-generation bioreactor would be more automated.

Finally, Metcalfe made clear that biodiesel is not necessarily the end product of the company's algae farming technology.

Instead, its customers will be able to sell their algae for "feed, food, or fuel," he said.

Updated at 3:25 p.m. PDT following interview with Bob Metcalfe.

Tiny algae is ready for some long-haul trucking.

Solazyme, a South San Francisco, Calif.-based company that creates synthetic biological products, said Wednesday that its microalgae-derived fuel is the first renewable diesel to meet the American Society for Testing and Materials' D-975 specifications.

Here is algae being grown in dishes at Solazyme's labs. The oil produced by the algae can be used for fuels, chemical, or food oils.

(Credit: Solazyme)

The fuel is chemically the same as petroleum-derived diesel, Solazyme said, so it can be distributed using the existing infrastructure. But it burns cleaner than petroleum-derived diesel, with fewer particulates and sulfur levels.

A 100 percent blend of Solazyme's diesel has been road-tested in a 2005 Jeep Liberty with a diesel engine, the company said in a statement.

Solazyme's certification is a milestone in algae-based fuels, one of the hottest areas of biofuels.

Algae as a feedstock is more desirable than soy because it is not a food crop, yields more oil, and can grow on marginal land.

But, in general, the technology is still experimental and algae-based diesel has not been produced at commercial scale.

Solayzme's process differs from most algae farming in that the microalgae is grown without sunlight in a setting more akin to a brewery than an open pond.

In its fermentation process, the company puts large amounts of algae into a vat, mixes in sugar, and then controls the pressure and other environmental factors inside the vat to induce the algae to metabolize the sugar into oil.

The process can be used to make oils and chemicals from other forms of biomass, including wood chips, corn stover, and switchgrass.

Algae, it seems, is the new darling of the biofuels world. Aurora BioFuels on Tuesday announced that it has raised $20 million to build open-pond algae farms to make bio-oil.

It's one of several funding announcements from start-ups looking to make algae a commercially viable alternative to soy, canola, or fry grease to make fuel for diesel vehicles.

An algae farm.

(Credit: U.S. Department of Energy)

Aurora BioFuels, started by University of California at Berkeley students, has a process that it says can create biodiesel at yields that are 125 times higher and have 50 percent lower costs than today's production methods.

The company intends to commercialize technology developed at Berkeley by microbial biology professor and hydrogen fuel expert Tasios Melis who has developed bioreacators for hydrocarbon and hydrogen production from algae.

Aurora BioFuels' management has worked in pharmaceuticals, chemicals, and biofuels.

The $20 million series A round was led by Oak Investment Partners with previous investors Gabriel Venture Partners and Noventi participating.

If fry grease can run a Mercedes, why can't it power the restaurant it came from?

That's the idea behind Owl Power Company's Vegawatt power system, a machine that converts a restaurant's waste oil into electricity and hot water.

A concept drawing of the Vegawatt system that converts restaurant waste grease into 5 kilowatts of electricity.

(Credit: Owl Power Company)

Co-generation, where a fuel is burned to make electricity, is regularly done at landfill incinerators or industrial biomass generators. There are also home co-generators, such as the Freewatt from Climate Energy.

Owl Power's twist on co-generation is that it lets restaurants use what's normally a waste product as a fuel for themselves.

James Peret, the president and CEO of Owl Power Systems, is a mechanical engineer who started to work with a grease car, which uses vegetable oil to power a diesel engine. He realized that a lawnmower-size diesel engine could be used as a co-generator as well.

The company now has a prototype of the Vegawatt power system which it will begin beta testing with restaurants in the fall and release next year.

For restaurant owners, the generator shouldn't be a big change. They just dump their used fry grease into the Vegawatt system rather than their existing dumpsters.

Owl Power System intends to lease the machine, which is about 6 feet high and 2 feet deep, to restaurants for $400 a month. It's appropriate for restaurants that have two or three fryers--that covers a lot of McDonalds and donut shops, said Peret.

The electricity and hot water the machine generates won't cover all a restaurant's energy usage, but it could be used during peak times when electricity is most expensive.

Between 50 and 80 gallons of oil will cover about one-third of the electricity usage in a restaurant, Peret estimates. They also avoid paying hauling charges.

A leasing model, where Owl Power does the maintenance, means that companies don't need to purchase the machine.

"The minute restaurants hear about this, they say, 'When can I get it?'" said Chad Joshi, chief operating officer of the company.

Even though it is a waste product, fry grease has become more valuable to restaurant owners, particularly as rising soy prices have made biodiesel from soy uneconomical for producers. Enthusiasts collect it for making "grease cars" and there have even been reports of grease bandits.

The lowly soybean has found a calling higher than tofu and tamari sauce. It's being used to insulate equipment bringing electricity to millions of homes.

More than 100 utilities are using soy-based oil as a safer, eco-friendly alternative to petroleum coolants in electrical transformers, which convert high-voltage power from a plant to a lower voltage for consumers.

Supporters of soy instead of mineral oil for electrical transformers hope to prevent fires that happen almost daily around the United States.

(Credit: Coastal Electric Cooperative)

Fires occur nearly every day around the country due to problems with transformers, say proponents of soy oil. On May 2, flames leapt 15 feet above street level through a manhole in Cambridge, Mass, temporarily shutting down Harvard Square.

Soy oil is less flammable than those from petroleum and, if aflame, burns for less time.

"If you have a catastrophic failure from any source, from lightning or an explosion or whatever, you want this oil to be there," said Glenn Cannon, director of the Step Up coalition urging utilities to switch to soy. "Do you want to be the utility that has a toxic fire all over the place, or do you want to say, 'This is soybean food grade oil?'"

Soy oil also helps transformers to perform better and last twice as long as others, he said.

Cannon is a former manager of Iowa utility Waverly Light and Power and holds five patents on vegetable-based oils. He began exploring soy following a 1994 spill of 20 gallons of petroleum transformer oil that cost Waverly nearly $30,000 to clean up PCBs and other contaminants.

Annual U.S. consumption of transformer oils amounts to some 60 million gallons, he said. Electricity providers in Spain and Norway are big customers of soy oil, whose demand rose by 80 percent between 2006 and 2007, according to Cooper Power Systems, which makes high-voltage electrical hardware for utilities.

Agricultural giant Cargill provides soy-based Envirotemp FR3 fluid to Cooper Power Systems, which uses and sells it to other transformer manufacturers.

Spent soy transformer oil is recyclable for use in biofuel or for lubricants used in trucks, said Cannon.

Mineral-based transformer oil, on the other hand, contains cancer-linked ingredients and pollutes ecosystems when spilled. Every year, 250,000 gallons of the fluid leak from electrical equipment, according to Step Up. Thousands of gallons poured into the ground and waterways due to Hurricane Katrina, but the EPA didn't require utilities to report the mess because a national catastrophe was involved, Cannon said.

Long a staple of so-called health food stores, soy is increasingly called upon for mechanical and industrial applications. It's well known and controversial as an ingredient in biofuels.

Companies exploring alternatives to petroleum for other industrial oils include Green Earth Technologies, which sells 'green' motor oils for cars and boats that is made from waste animal fats.

Step Up stands for Safer Transformers, Environmental Protection, and Upgraded Performance.

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GreenFuel Technologies on Wednesday said that it has completed a round of funding to ramp up its algae-farming projects.

The company landed $13.9 million, which was led by Access Private Equity, Draper Fisher Jurvetson, and Polaris Venture Partners.

A portion of the money will retire debt the company borrowed following a corporate shakeup last year that put Bob Metcalfe in as interim-CEO. The remaining $7.6 million in new capital, which completes its series B round, will go to scale up technology projects.

Algae being grown at GreenFuel Technologies' test site at Arizona Public Service power plant.

(Credit: GreenFuel Technologies)

In a statement, Metcalfe said the company will announce a new CEO, a C round of funding, and signed customers for its technology.

GreenFuel also disclosed that one algae-growing project began in January but declined to provide details.

In March, news Web site Xconomy reported that GreenFuel had landed a customer in Europe that could be worth $92 million.

GreenFuel builds bioreactors that grow algae at sites that emit a lot of carbon dioxide. Its first pilot was at an Arizona power plant.

The algae is harvested and can be turned into biodiesel or other forms of biomass that can be converted into electricity or other liquid fuels.

A number of companies are developing algae technologies because of the rising cost of soybeans to make biodiesel and growing concern over growing food crops for fuels.