Monday, March 17, 2008

Area firms move ahead with plans for next-gen ethanol plants

By Efrain Viscarolasaga

As recent concerns have been raised about the production of ethanol and its effects on the national food supply, a handful of local companies have spent the past few years raising millions to build production plants using different ways to make the fossil-fuel alternative.

Cambridge-based Verenium Inc., for instance, is slated to be the first to get its facility on line. Verenium executives say the company expects to complete construction of its $50 million, 1.4 million gallon-per-year cellulosic ethanol demonstration plant in Louisiana by the end of the month. The site, which is located adjacent to the firm's pilot facility in Jennings, La., is on target to begin its first production of ethanol later in the spring.

If all goes according to plan, the opening of the Verenium facility would come before those of the company's local rivals, Boston-based Mascoma Corp. and Quincy-based BioEnergy International LLC. But John Howe, Verenium's vice president of public affairs, said that doesn't mean Verenium's competitors should pack up and go home.

"There are a lot of companies currently in the ethanol business and a few in the cellulosic ethanol business, and that's a good thing," said Howe. "With the passage last year of the Energy and Security Independence Act (which mandated the domestic use of 16 billion to 18 billion gallons of ethanol over 15 years) there is a huge demand that will require several successful companies to fulfill."

The others are also not far behind. Mascoma, which raised $50 million in equity and debt financing two weeks ago, expects to have its cellulosic facility in Rome, N.Y., up and running as early as June, said Justin van Rooyen, director of business development for Mascoma.

BioEnergy is breaking ground this week on a corn facility in Pennsylvania, and working toward building a cellulosic plant at the same site, scheduled to begin construction later this year.

While federal legislation and a general movement away from fossil fuels has shone a spotlight on ethanol, some studies and reports have questioned the viability of the biofuel as a sustainable alternative, claiming that using feedstock such as corn could have an negative impact on agriculture and the nation's food supply.

Verenium, Mascoma and BioEnergy, however, are part of a new generation of biotechnology engineering firms focused on generating ethanol from organic materials not used as food. For instance, Verenium's Louisiana plant plans to use a dry pulp waste from sugar cane, but also plans to experiment with wood products and switchgrass, which can grow in areas where food stock would not. Mascoma and BioEnergy are looking at similar systems, focusing on breaking down and fermenting cellulose, a part of all green plant cells, not just food stock.