BASIC Associates: First-Generation Ethanol Technology Continues to Move Forward

Thursday, October 28, 2010

First-Generation Ethanol Technology Continues to Move Forward

By Robin J. Johnson, Ph.D.

In 1996 the ethanol yield from corn was 2.5 gallons per bushel. Today, a dry mill corn ethanol plant can produce up to 2.8 gallons per bushel. In Brazil, the ethanol yield from sugarcane has risen from 375 gallons per acre per year in 1975 to 870 gallons per acre per year in 2006. Technological innovation leading to these yield improvements is a hallmark of the ethanol industry.

On October 26, 2010, a California company called iDiverse announced successful modification of ethanol-producing yeasts, allowing them to tolerate stresses that occur in fuel ethanol production. A visit to the iDiverse website (which appears to have been last updated in mid-2007) reveals that the company is working to commercialize genetic engineering technology developed at and licensed from the University of Nebraska - Lincoln. The technology can be used to strengthen stress tolerance not only in yeast, but in a variety of other types of cells as well. Their various genetic constructs protect plants against diseases and environmental stresses and protect yeasts against oxidative stress. The company states that technology is presently at the proof-of-concept stage and that the second-generation is in development.

When iDiverse's technology becomes ready-for-prime-time, it could increase ethanol yield from each bushel of corn processed. In the mean time, other technological improvements may have an even larger impact on the efficiency of ethanol production. Technological innovations such as improved enzymes, corn varieties optimized for ethanol production, feedstock fractionation, and low heat fermentation are all being examined in order to increase ethanol yield. Another California company, EdeniQ, uses three-pronged approach to increasing corn ethanol yields that includes an improved yeast, a better milling device, and improved enzymes.

What does this mean for the fuel ethanol industry? Increased yield from a bushel of corn or hectare of sugarcane naturally increases the profitability of an ethanol plant. It also means that less of the world's arable land will be needed to grow fuel feedstocks, and that is a very good thing.

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About BASIC

Unlike other investor services, BASIC Associates focuses not on the financials, but on the science behind various R&D initiatives in bioproducts. Sound science, after all, is the ultimate driver of profitability in the industry. We believe that a superior understanding of the science behind the business model reduces uncertainty and risk and allows for better decision-making by investors and stakeholders.

The principals at BASIC Associates use their doctoral training, coupled with years of experience researching and writing about biofuels, biochemicals, and other bioproducts, to provide an accessible science-oriented analysis of companies and projects in this growing market.

Meet the Principals

Robin J. Johnson, Ph.D.

Dr. Johnson is a cofounder of BASIC Associates. She previously worked as a curator for Garbrook Knowledge Resources, which she joined in March of 2007. Prior to joining Garbrook, she was a Scientist at Genstruct, a systems biology company that creates computer models of biological pathways, and a curator/editor at Incyte and later Biobase, working on the Proteome BiKnowledge Library. (Proteome was a successful knowledge company that provided comprehensive annotation of the proteomes of a variety of organisms, including humans.) As an assistant Professor of Biochemistry at Boston University School of Medicine from 1985-2003, Dr. Johnson taught Medical School and did research in the field of cellular neurobiology. She has numerous publications to her credit. Dr. Johnson received her B.S. in Biology from the State University of New York at Stony Brook and her Ph.D. in Anatomy from Boston University. Her postdoctoral studies of viral infection in the nervous system were performed at Yale University School of Medicine Section of Cell Biology.

Daniela Sciaky, Ph.D.

Dr. Sciaky, a cofounder of BASIC Associates, is a scientific expert in plant biotechnology and biofuels and bioproduct processes. From 2006 to 2010, she was the senior content expert at Garbrook Knowledge Resources, where she contributed her expertise to the gathering and organization of biofuels and bioproduct information. From 1998 to 2006, she curated the scientific literature on a wide variety of topics, including plant and yeast molecular biology, helping to develop content for the Proteome databases. She has also held research positions with Children's Hospital of Cincinnati and Albany Medical College and faculty and research positions at the University of Cincinnati and Brookhaven National Laboratory. During the course of her career, Dr. Sciaky has served as a peer reviewer for the US Department of Agriculture, the National Science Foundation, and the US Department of Energy, in addition to reviewing papers for the The Plant Cell, Biochemistry, Planta, Nucleic Acids Research, Plasmid, Bio/Technology and BioScience journals.

Dr. Sciaky received her M.S. and Ph.D. in Genetics from Washington State University and her B.S. in Biology from the State University of New York at Stony Brook. She did post-doctoral research at the Cold Spring Harbor Laboratory, NY. She has presented at numerous scientific conferences and is well published in plant disease and natural systems as well as other fields.

Henrique Oliveira, MBA

Henrique, a cofounder of BASIC Associates, worked as a curator for Garbrook Knowledge Resources from 2008 to 2010. A citizen of both Brazil and the United States, he received his MBA in Finance in 2008 from the Stephen M. Ross School of Business at the University of Michigan in Ann Arbor, where he was awarded a fellowship by the University’s William Davidson Institute to conduct research on Brazil’s 35-year experience with biofuels. As a Fellow of the Institute, Henrique spent several months in 2007 touring biofuel facilities in Brazil with Tom MacDonald, a senior researcher with the California Energy Commission and the head of MacDonald Associates, a boutique consulting firm specializing in alcohol transportation fuel.

Prior to joining Garbrook, Henrique worked as a consultant for Hart Energy’s Global Biofuels Center. He has extensive business experience in Brazil and has authored a number of reports on the country's biofuels industry, which, because of its size and depth, impacts alternative energy initiatives worldwide. Henrique has also written editorials on the Brazilian ethanol and sugar industry for various publications.