BASIC Associates: Ethanol, Why Brazil and Not the United States ….Yet?

Wednesday, November 3, 2010

Ethanol, Why Brazil and Not the United States ….Yet?

By Daniela Sciaky, Ph.D.

Ethanol as a transportation fuel can be a dirty word in the United States when it comes to fuel efficiency. The energy content of ethanol is less than gasoline resulting in lower gas mileage. However ethanol has a higher octane rating than gasoline and if engines are tuned to use ethanol then much better performance is delivered by the use of ethanol.

What technology is available to take into account ethanol’s advantage? Sturman Industries hosted a technology summit in late October that brought the renewable fuel industry together with engine designers. Sturman proposed to replace the camshaft-controlled valves traditionally found in internal combustion engines with computer-controlled valves whose performance can be adjusted on the fly. This technology results in maximizing the performance of any fuel used by the engine.

Scania, a European engine and vehicle manufacturer, has pioneered many efforts to develop engines for ethanol and other renewable fuel powered vehicles. In October the company was awarded a 3.3 million EUR grant by the Strategic Vehicle Research and Innovation Initiative in Sweden to develop an engine for heavy commercial vehicles capable of running on biofuels. The company will focus on developing technology for both alcohol and methane gas-based fuels.

However, in case people haven’t noticed Kia Motors just unveiled the Kia Soul Flex, a car that can run on 100% ethanol, 100% gasoline or an ethanol-gasoline mixture. According to Kia the Soul Flex exhibits a 44% improvement in fuel efficiency. Power and torque are also improved compared to the existing gasoline model. The Soul Flex has a newly adapted fuel injection and catalyst system as well as a fuel tank assistance system that aids engine ignition at low temperatures. Unfortunately for the US, the car is only being introduced to Brazil.

Acceptance of ethanol in the US is still a long way off. Brazil, because of its adoption of alternative fuels has become a magnet for the adoption of new technologies that are still in the proposal/testing stages in the US. Ethanol will fail to reach its full potential in the US unless these innovative technologies are also adopted in the US.

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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.