Turning Waste into Fuel

By Unmesh Kher

When the hawks and greens of Washington's new anti-oil coalitions talk about ethanol fueling the future car, they aren't talking about the brew distilled from cornstarch. What they are referring to is a more fiscally and environmentally defensible alcohol, brewed from prairie grasses or agricultural waste, like straw. Trouble is, the technology required to commercialize bioethanol is in its infancy.

People like CEO Steen Riisgaard, a passionate environmentalist who went into business because he thought he could do good, are helping the technology mature. Novozymes, the $1 billion, Copenhagen-based company he leads, sells microbes and enzymes made from genetically engineered bugs that improve consumer products and make dirty industrial processes more environmentally friendly. But as the volume of ethanol brewed in the U.S. has doubled since 2001, to 3.4 billion gal., the farm-fuel business has become Novozymes' fastest-growing source of revenue.

Enzymes that help transform cornstarch into ethanol are fairly run-of-the-mill in biotech terms. The same can't be said of those needed to brew bioethanol from indigestible plant fibers. Making enzymes efficient and cheap enough for that has long been an obstacle to a viable bioethanol industry. Canada's Iogen is the only biotech firm to have shipped a batch of commercial bioethanol (see main story). But Novozymes is making waves as well. It announced in March that with $17 million in U.S. Department of Energy (DOE) funding, it had reduced the cost of enzymes for making booze from corn stover from $5 per gal. of ethanol in 2001 to a mere 10-c- to 18-c-.

"We are involved in this because we believe there is a market," says Riisgaard, though he thinks a large bioethanol industry is still years away. With more funds from the DOE, Novozymes will supply enzymes for a bioethanol plant to be built in Nebraska next year by a subsidiary of the Spanish firm Abengoa. More than a few people in Washington will be watching. --By Unmesh Kher. Reported by Ulla Plon/Copenhagen

With reporting by Reported by Ulla Plon/Copenhagen