Posted 09.01.2010

Cleantech trends

It's happening now, and it's happening here

By Eric Peterson

Critical mass. Turning point. Widespread adoption.

These are the terms we hear in relation to many emerging clean technologies: They are seemingly continually on the cusp of hitting the mass market in a big way, any day now. But hype sometimes overshadows reality.

The times, however are a-changin': Market dynamics for four prime clean-tech categories - biofuels and bio-based chemicals, solar, wind and electric vehicles - are not just theoretically on the cusp any more. They are visibly on the cusp. Cleantech is happening now, and it's happening here: Colorado is emerging as an industry hub, with local players grabbing national headlines.

And it's not just hype. "I think it's reality," says Alexandra Tune, director at Deloitte & Touche's Denver office. "There are a lot of cleantech companies in Colorado and a lot of cleantech companies are relocating here." She points to the federal government - largely in the form of the National Renewable Energy Laboratory in Golden - as well as the state's mandate that 30 percent of electricity come from renewable sources by 2020. Plus, there's a highly educated work force and numerous cleantech-relevant programs and initiatives at the University of Colorado, Colorado State University, and the Colorado School of Mines.

"It's a culture here," says Tune.

So can Colorado capitalize on its current position and leap to the head of the cleantech class as an international center? Citing state-led and municipal recruitment and messaging efforts as well as the Colorado Cleantech Industry Association's in-progress "road map" to such an endpoint, Tune says, "There's no reason it can't."

BIOFUELS AND BIO-BASED CHEMICALS

"Many companies that were focused on biofuels are beginning to say they're more interested in bio-based chemicals," says Charles "Chas" Eggert, CEO of Boulder-based OPX Biotechnologies. Why? "Specialty chemicals have higher prices, so they can have higher manufacturing costs. The initial commercial plant size for a bio-based chemical can be significantly smaller than a plant for a biofuel."

OPX engineers microbes to efficiently produce bioacrylic and biofuels, and the former has been the company's primary push since its 2006 founding. Biofuels will come next: Because of the market dynamics, small-scale ethanol production can't compete with the oil industry and its vast extant infrastructure, says Eggert. He sees biofuels moving from such inputs as corn and cane sugar - both of which he is quick to label as viable - to cellulose, but innovation is necessary.

"For biofuels, the key trigger is further commercialization of using cellulose, and not corn or cane sugar, to make ethanol," he says. "That is the key that unlocks the value chain for the manufacturing model." Another trigger would be a shift in policy, not a jump in innovation: increasing the "blend wall" - i .e. the amount of ethanol in gasoline - from 10 percent to 15 or 20 percent.

Eggert is quick to point out that bio-based chemicals are nothing new, used by the pharmaceutical industry and others for decades. "There are plenty of examples of successful bio-based chemical companies already," he says. "The questions are, how well can you engineer your microbe and how well can you engineer the process? That's what we at OPX think is our best advantage."
To be sure, 2010 is turning out to be a banner year for OPX Biotechnologies, making it 95 percent of the way toward its target of making bioacrylic for 50 cents per pound, which Eggert says is the target commercial cost. "That's lower than producing it with petroleum."

While the company's biofuels push is slightly behind the bioacrylic's current pilot-stage status, the timeline was accelerated in April when OPX landed a $6 million research grant from the U.S. Department of Energy. With the money, "We're hiring and building out the lab in Boulder to do the work."

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