Ethanol from corn is yesterday's news, though you might not know it from the headlines and congressional hearings blaming the alternative fuel for rising food prices and disappearing rain forests.
Ethanol derived from other types of plant sugars, such as switch grass and plant waste, is already being produced in small pilot plants in the United States. This second generation of biofuels could be available in a few years, with Verenium, which has a large San Diego presence, poised to lead the pacack.
Meanwhile, a third generation of biofuels is being developed by Sapphire Energy, a San Diego startup company that is growing algae – your everyday pond scum – to create gasoline.
Interest in alternative fuels has exploded, with about $2.9 billion invested in 2006 by venture capital, industry and private markets.
The topic is commanding attention at this week's BIO International Convention at the San Diego Convention Center, the annual conference for the Biotechnology Industry Organization.
A summit focusing on biofuels and other clean technologies held yesterday allowed investors to share the latest technological advances and map future development.
Recent breakthroughs in biotechnology will aid in the production of new fuel sources that promise to supplement, and maybe one day replace, the fossil fuels used in the $2.8 trillion global petrochemical industry.
But expect it to be a long and complicated process, said Brent Erickson, executive vice president of BIO's Industrial & Environmental Section.
“The first kerosene distilled from oil was used in 1853 to replace whale oil to light American homes,” Erickson said. “It took 125 years for the oil industry to develop oil refineries to be what they are today – highly complex and technologically advanced enough to take a barrel of oil and turn it into myriad products.
“We need to think about biofuels in the same light: Ethanol from corn is just the beginning. The second-and third-generation biofuels are coming.”
Ethanol, a type of alcohol that is fermented by combining yeast with plant sugars just like good ol' hooch, is the core product in first-and second-generation biofuels.
Corn was the obvious initial fuel source because it gives up its sugars easily for the fermentation process.
However, scientists around the world realized a few years ago that using corn to produce ethanol as an alternative fuel source would not be the answer. Corn ethanol's biggest drawback is that the corn is grown on land that otherwise could be used to grow food, Erickson said.
“There are 6.5 billion people on this planet now and the population is expected to be 9 billion in another 45 years,” said Steve Kay, dean of the division of Biological Sciences at the University of California San Diego. “We are going to have to double our food production between now and then. And we are going to need more farmland to do it.”
Corn for ethanol also requires fertilizers, which are petrochemical products and therefore negate some of the environmental pluses for corn ethanol.
Recent complaints that corn ethanol is driving up food prices are overblown, Kay said. A study by Texas A&M University shows that fuel prices are the biggest contributor to driving up food prices: It costs more to fertilize the crops, run the equipment to harvest them and fuel the trucks that ship them.
Another big contributor to food cost is weather, such as the recent floods in Iowa. The use of corn for biofuel was fifth on the list, contributing to 10 percent of food-price increases, according to the study.
The Bush administration decided several years ago that developing ethanol from other fuel sources should be a priority. The administration made investment in that research a means for helping the country reach mandates to produce 36 billion gallons of fuel from renewable sources by 2022, Kay said. Sixteen billion gallons must be cellulosic ethanol, meaning it must come from a plant source.
Scientists agree that research into solving the energy crunch should proceed on a number of different biofuels.
In San Diego, scientists at Verenium, which used to be called Diversa, are developing methods to draw out the sugars from numerous plants and help ferment them into ethanol.
Plants don't give up their sugars easily because they are covered in a tarlike substance, said Justin Stege, Verenium's associate director of alternative fuels. So Verenium, which has its headquarters in Cambridge, Mass., looked at nature to see how animals and insects that digest plant matter turn it into sugar.
In Costa Rica, the company found termites that served as the genetic model for a new enzyme that it is commercializing for biofuel production, Stege said.
Verenium is already putting the enzymes to work in another division of the company: ethanol refineries in Jennings, La.
The company's 50,000-gallon-capacity pilot plant there has been operating for a year. It recently opened a larger plant to test its production process and prepare for the next stage: construction of commercial facilities.
Several other companies, some of which received federal grants, are following the path Verenium plowed. The competition is needed because of what scientists believe to be one of the biggest drawbacks to ethanol: It cannot be transported through the nation's $3 trillion energy infrastructure because it absorbs water and would rust the pipes.
As a result, it must be produced regionally. Each production facility will grow a fuel stock that thrives in that particular climate.
Ceres of Thousand Oaks and Mendal Energy of Hayward are developing switch grass and other biofuel stocks by genetically engineering the plants to improve yield per acre and use less water and fertilizer. These seeds will be sold to biofuel farmers around the world.
Meanwhile, large agriculture companies and the oil industry are also getting into biofuel. DuPont is collaborating with BP in the pursuit of biobutanol that can derived from plants and mixed with gasoline. Gevo, a Pasadena company, has licensed science from UCLA the uses E. coli bacteria to produce biobutanol.
Others are developing biodiesel, a fuel source for diesel engines derived from natural oils such as soybean. But this, too, has its problems. For instance, it has crystallization problems and cannot be stored in very low temperatures, including a car in winter, said Steve Briggs, a professor of biology at UCSD.
These fuels also use farmland, Kay said.
“From the middle of the country west, there's simply not enough water to grow the plants needed for these fuels,” he said. “While it will help meet the growing demand for fuel in the short term, it's just not going to be a sufficiently sustainable solution.”
Not to worry. San Diego's research talent may have the makings of the third-and fourth-generation of biofuels that could propel the region to be the “Green Houston,” he said.
Sapphire Energy, a La Jolla company that has announced it can produce 91-octane gasoline from algae, is leading the charge. The company, founded a year ago by Arch Venture Partners of San Francisco, is scaling up its process for pulling a green crude out of algae that could be pumped directly into the nation's gasoline pipelines.
“Algae has an advantage because it can be produced in really crummy environments, like desert, using saline aquifers or wastewater, sunshine and carbon dioxide. And it grows fast – 10 to 50 times faster than plants,” said Briggs, a Sapphire founder and a member of its advisory board.
This gasoline doesn't create greenhouse gases or benzene, he said. Its byproducts include oxygen and filtered water.
Sapphire hopes to make commercially available 10,000 barrels of green crude annually in three to five years, said Kristina Burow of Arch Venture Partners.
“We have this vision of what Sapphire can be . . . creating the equivalent of an oil field out of the desert or nonagricultural land that once it is built has an infinite supply of oil and you know exactly what you are getting,” Burow said. “Close your eyes and think about what this could be and I think it's really pretty incredible.”
Terri Somers: (619) 293-2028; terri.somers@unntrib.com
