Two Danish firms have announced some significant breakthroughs related to the production of cellulosic ethanol:
Danish enzyme makers claim biofuel breakthrough
By Andrew Ward in Stockholm
Financial Times
Published: February 16 2010 02:00 | Last updated: February 16 2010 02:00
Novozymes will today claim a breakthrough in efforts to produce biofuels from agricultural waste a day after rival Danisco made its own push for leadership of what could become a multi-billion dollar industry.
The two Danish enzyme makers have each poured tens of millions of dollars into development of technology to enable production of ethanol from non-edible plant leftovers, such as straw, corn cobs and sugar cane off-cuts.
Both are aiming to show that the investments are close to paying off as they unveil new enzymes designed to make so-called cellulosic ethanol commercially viable after years of unfulfilled promises.
Novozymes, spun off from Novo Nordisk, the Danish pharmaceutical group, a decade ago, will tell a biofuel conference in Florida today that it has created an enzyme capable of producing cellulosic ethanol at a cost of $2.25 a gallon - close to the price of petrol and conventional ethanol.
Danisco yesterday told the same conference that it too had made a technological advance with the launch of an enzyme that it predicted would become the industry standard "in terms of cost and performance".
Cellulosic ethanol has been the focus of intense research and development for years because of its potential to reduce greenhouse gases more sharply than conventional ethanol. Because it is made from non-edible waste, it also promises to ease the problem of corn-based ethanol driving up food prices.
President Barack Obama this month renewed the US commitment to increase the proportion of biofuels used in vehicles, with a goal for 16bn gallons a year to come from cellulosic ethanol by 2020.
Martin Sikorski, an analyst at Cheuvreux in Stockholm, says that, if met, the US target would imply annual enzyme sales of about $5bn, with Novozymes and Danisco in pole position to benefit.
"These two have been working for years on this technology," he said. "Novozymes is maybe in the best position but, ultimately, refiners are going to want more than one supplier, so there will be room for both."
Many analysts, however, are likely to remain sceptical of the breakthrough claims of both companies until commercial production gets under way after many false dawns in the past.
Steen Riisgaard, Novozymes chief executive, said full-scale production would start in 2011 when Poet, the big US biofuel producer, is scheduled to open the world's first commercial cellulosic ethanol facility.
Several other plants are also planned, including two in the US planned by BP, the UK-based in oil and gas group.
"Some people would claim that cellulosic biofuel is always another five years down the road.
"We've said for the past two years that we would have the technology ready by 2010 and we have," said Mr Riisgaard.
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