GM BUYS INTO BIOFUELS

There is wisdom in the expression “If it sounds too good to be true, it probably isn’t true.” That might be what energy industry analyst Kevin Book was thinking when he commented on GM's breakthrough ethanol processing technology: "It would be an incredible story if it's true…This hits on the sweet spots."

Here’s the problem: Once an American powerhouse, it is now difficult to distinguish GM’s promise from its hype. It promised a plug-in hybrid Chevy Volt by 2009, or 2010, but now is claiming there are problems with the battery. (See GM CEO Waggoner Sows Doubt About Volt at Plugs and Cars)

No biological process for producing ethanol is considered viable at commercial scale and cost. This one would be the first. Cal-Tech Professor of Chemical Engineering and Biochemistry Frances Arnold recently explained that the bacteria convert the biomass to ethanol only to survive. Getting them to do it efficiently enough to produce commercially viable quantities at competitive prices is expected to require genetic engineering.

(From Professor Arnold's lecture slides -- click to enlarge)

Maybe Coskata’s academics have discovered a self-selected breed of bacteria. They claim their bugs are 90% efficient, can get 100 gallons of ethanol/ton of raw biomass (current best is 70 gallons/ton) and claim the cost will be about $1/gallon (half that of petroleum gasoline). The process requires 1 gallon of water/gallon of ethanol (corn uses 4 gallons of water to get a gallon of ethanol), releases 84% less emissions than corn ethanol processing and, unlike other cellulosic ethanol processes, requires no special preparations to immediately achieve commercial volumes.

This is where somebody usually says, “…and if you believe that, I’ve got a bridge in Brooklyn I can sell you.”

GM banking on a biofuel breakthrough
Justin Hyde, January 14, 2008 (Detroit Free Press)

WHO
Coskata Inc. (Bill Roe, CEO), General Motors Corp. (Rick Wagoner, CEO)

WHAT
Coskata has a biologically-based process by which biomass can be converted to better ethanol more efficiently in virtually unlimited volumes without undue water consumption than by any other known process.

Schematic of the Coskata process. (click to enlarge)

WHEN
- Coskata promises a 40,000-gallon-a-year pilot plant (undetermined location) fueling GM proving ground vehicles by the end of 2008. It will also break ground on a full-scale 100-million-gallon plant (undetermined location) this year that will open by 2010.
- The Bush administration-driven energy bill of 2007 mandated a 36 billion gallons/year biofuel production by 2022, of which 21 billion gallons/year must be other than corn ethanol.
- DOE did not predict any process achieving the Coskata cellulosic ethanol gallons/ton levels before 2020.

WHERE
- Coskata is based in the Chicago suburb of Warrensville, Illinois.
- The Coskata process was developed at the University of Oklahoma and Oklahoma State University.

One of the main reasons everybody wants into biofuels. (From Professor Arnold's slides -- click to enlarge)

WHY
- If all Detroit-built flex-fuel vehicles burned ethanol in 2012, U.S. oil demand would drop 18%. But only 1400 of 170,000 use stations sell ethanol. Only 6.2 billion gallons were produced in 2007. And yet that little production drove food prices up painfully.
- Coskata’s process depends on 5 varieties of “thoroughbred” bacteria discovered in lagoon muck uniquely efficient at turning syngas, a gas generated by the decay of any carbon-based biomass, into ethanol.
- Bacteria are grown on human hair-thin straws that act as a filter. Syngas from the biomass flows inside the straws. Water is pumped along the outside. The bacteria move through the straws, converting the gas to ethanol (keeping 10% to reproduce) which is carried away by the water for refining.

The complexities GM thinks Coskata has bypassed. (From Professor Arnold's slides -- click to enlarge)

QUOTES
- Bill Roe, Coskata CEO: "This is a speed to market play…It's ready today, and we are moving rapidly toward commercialization."
- Rick Waggoner, GM CEO: "Nothing else we can do gets even close to that kind of impact [cutting oil demand 18%] that soon…"
- Robert Wallace, biofuels production engineer, National Renewable Energy Laboratory: "You can have all the pieces to a car, but it doesn't mean you have a car…[new plants with new processes] have to get all the bugs out of running a plant that size before investors start investing."