Cool Planet Energy to Further Develop Second Generation Biofuel Capability
News Oct 31, 2013
Cool Planet Energy currently develop cellulosic “drop-in” biofuels for use in motor vehicles and aeroplanes in the United States. These “second generation” biofuels are made from non-food sources of biomass like crop waste or forestry by-products, rather than relying on conventional food crops like corn or sugar cane.
The new investment will fund engineering design for the first of three commercial facilities, with the hope of producing 10 million gallons of high-octane cellulosic gasoline by the end of 2014. The new facility will also allow for the production of biochar, which can be returned to soil to improve water retention, crop productivity and plant health. This process is ‘carbon negative’, reversing the consequences of fossil fuels by removing up to 150 per cent of CO2 for every gallon used.
Second-generation fuels have the advantage of utilising biomass which would not otherwise have been used for human consumption. Crops like switchgrass or miscanthus can potentially be grown on lands that are not suitable for growing food crops, needing little or no fertilizers or irrigation, reducing nutrient and water requirements. They also put less pressure on worldwide food prices, as seen with corn-ethanol production in the United States.
So far, cellulosic technology has struggled to reach commercial viability, with costs of production relatively high in comparison to corn-based ethanol. However, a recent report by Bloomberg’s New Energy Finance (BNEF) found that second generation biofuels should become cost-competitive fuel solutions by 2016, with the costs of enzymes and processes associated with their production falling.
Cool Planet Energy’s technology is clearly providing investors with confidence about its long term viability, attracting some of the industry’s biggest names, including investors from Hong Kong, Singapore, the United Arab Emirates and Mexico. Cool Planet is hoping to extend its distribution network all over the world, developing partnerships with key players in international markets:
“While equity markets remain closed to most biofuel businesses, investors are seeing a differentiated opportunity in Cool Planet. Our drop-in cellulosic gasoline and biochar technology has global potential,” said Cool Planet CEO, Howard Janzen.
“A strong proof point for this potential is the impressive group of international investors who have participated in our equity raise, positioning the company for long-term growth globally,” he added.
As investment in second generation fuels grows, producers like Cool Planet Energy will see their relative costs of production fall, which will allow further investment in productive capacity. Cellulosic fuels will then likely rival traditional biofuels like ethanol as a cost-effective source of renewable fuel.