From the Scientific World:
http://www.thescientificworld.com/NewsLab/newslab_details.asp?uid=&bid=&id=656§ionId=2

Can organic waste become the nation's next big power source?

In theory, using cellulosic biomass makes a lot of sense. Take what would otherwise be waste or animal feed--agricultural and forestry residues, recycled paper, and other organic waste--treat them with acid and the right enzymes, and create relatively clean-burning ethanol and other byproducts. In doing so, there would be less landfill, pollution, and a reduced national dependence on oil, more than 55 percent of which comes from overseas.

In reality, while the apparent energy crisis has made so-called cellulosic biomass technologies more attractive, the industry, like that of other renewable fuels, including wind and solar power, continues to face scientific, political, and economic hurdles--as it has for years. "We're still treated as a marginal industry," says Katherine Hamilton, co-director of the industry advocacy group the American Bioenergy Association, referring to all renewables. "We're not at the table with coal and oil and gas and nukes. We're a way to make [legislators] look good, but not really do anything."

As with researchers and advocates in other renewable fuels areas, those involved in cellulosic biomass have gotten mixed signals from the federal government, whose research and processing-plant startup funds are crucial if cellulose-derived ethanol is to replace gasoline to any significant degree. The Department of Energy (DOE) and companies engaged in cellulosic biomass research hope that scientific advances will soon make cellulose-to-ethanol fuels both viable and profitable. But legislators, while showing some support for basic research, have not yet shown a willingness to rely on a power source other than oil.1 An established cellulosic biomass industry will also have to find a way to complement, and not compete with, the more mature, corn starch-derived ethanol industry.

Corn vs. Corn Stalk The U.S. will produce about two billion gallons of ethanol this year. Most of it is blended with gasoline in an approximately 90 percent gasoline-10 percent ethanol combination; the blend has slightly less energy than straight gasoline. According to the National Ethanol Vehicle Coalition, 1.5 million vehicles in the United States have actually been outfitted to run on an 85 percent ethanol blend. However, the ethanol currently produced comes strictly from starch in the corn itself, which makes up 70­75 percent of a bushel of corn. To make ethanol production efficient enough to be an independent, viable energy alternative, researchers are looking for ways to derive ethanol from the plant's remaining parts, as well as from other organic waste such as rice straw, switchgrass, and discarded paper products. In the case of corn, the parts unused in traditional ethanol production include corn fiber, corn stover, cob, stalk, and silk--all of which are primarily composed of cellulose.

But all biomass materials have a common problem: cellulose, their primary component, which is not easily broken down into fermentable sugars such as glucose. Another major component, hemicellulose, a polymer of five carbon sugars called pentoses, will only ferment into ethanol if researchers use genetically engineered yeast or bacteria. Between 30 and 40 percent of the sugar extracted from biomass is glucose from cellulose; another 35 percent is a sugar called xylose, which is derived from the hemicellulosic fraction of the biomass. Fermenting the xylose to ethanol is crucial if scientists are to make the production of ethanol cost-effective and competitive with that of fossil fuel.

To break down the cellulose, work is continuing on better, cheaper cellulase enzymes--what, Gerson Santos-Leon, DOE's ethanol project manager in the office of fuels development, calls the main technical barrier to making cost-effective ethanol from cellulosic biomass. Enzyme research is a big part of the recently passed Biomass Research and Development Act of 2000. The act, sponsored by U.S. Sen. Richard Lugar (R-Ind.), authorized $49 million per year, over six years, to be spent on biomass research by DOE and the U.S. Department of Agriculture. No money was appropriated, however. And, according to Santos-Leon, no money was appropriated to USDA for 2001. DOE received $18 million for applied R&D, most of which has a private sector component.

DOE's National Renewable Energy Laboratory (NREL) recently challenged Genencor Inc. of Palo Alto, Calif., and Novozymes Biotech Inc. of Davis, Calif., to reduce high enzyme costs by as much as 10-fold. Earlier this year, NREL awarded Genencor $17 million over three years, and awarded Novozymes $14.8 million over three years. According to Santos-Leon, DOE estimates that biomass enzymes purchased from industry cost 50 to 70 cents per gallon. To make the process viable, their cost will have to be brought down to the 5 to 10 cents range, says Santos-Leon. Based on what he's seen so far, Santos-Leon believes the DOE's goals are within reach.

Also in line with the Biomass act, DOE's biofuels program will also research and attempt to increase the efficiency of pretreatment systems that break down hemicellulose, a crucial, potentially cost-cutting hydrolysis step done before the addition of the enzymes and fermentation organisms. Researchers are looking for better enzymes and better ways to use strong and weak acids to break down the hemicellulose into xylose.

To actually convert xylose into ethanol, scientists have tried incorporating enzymes into recombinant microbes like the yeast Saccharomyces cerevisiae, the bacterium Zymomonas mobilis, or the common bacteria Escherichia coli--the focus of projects that are also part of the Biomass Act. Scientists are still working on perfecting these organisms, though there have been significant improvements. "These projects will be profitable," says Santos-Leon. "That's why the private sector is willing to take the risk."

In 1998, Purdue molecular geneticist Nancy Ho reported engineering S. cerevisiae that can metabolize xylose to ethanol. "Scientifically, it can be used now," says Ho. "You can put all of this technology together, [and] it can produce ethanol reasonably well." She is currently working to develop this technology on a large scale, with help from one company that she declined to identify, and Indiana-based SWAN Biomass, which is working on converting wheat straw. Ho says that the yeast can produce ethanol together with other products to make ethanol production more cost-effective.

University of Florida microbiologist Lonnie Ingram, who received some DOE support, has genetically engineered an apparently harmless strain of E. coli called K011 to produce high-yield ethanol from xylose and other biomass sugars.2 The Dedham, Mass.-based BC International Corp. holds exclusive rights to Ingram's technology and plans to have its first large-scale plant, located in Jennings, La., operational by 2002.

Promise and Progress But despite the promise of such research, and despite the money authorized by the Biomass Act, the federal funding request for biomass programs for the next fiscal year was actually reduced 6 percent, and renewable programs in general actually received a 40­50 percent reduction in funding. President George W. Bush's National Energy Policy report, released in May (www.whitehouse.gov/energy/ National-Energy-Policy.pdf), makes overtures toward biomass R&D, but according to American Bioenergy Association's Hamilton, calls for a few unexpected measures. These include an ethanol tax credit for electricity produced using renewable technologies, such as biomass and biomass co-fired with coal, which had already been approved through 2007; and a re-evaluation of private access to federal lands for more biomass retrieval.

Hamilton likes the proposed idea of opening up former waste sites, known as brownfields, to the possible development of renewable fuels plants. But, referring to the White House report, she would have liked to see a renewable-fuels, field-production minimum standard, requiring that transportation fuel contain a base amount of renewable fuels. Senators Lugar and Tom Daschle (D-S.D.), the new majority leader, have introduced a bill that would do precisely that. According to Hamilton, such a policy would enable the tripling of ethanol production in the United States by 2010, at least one-third of which would be derived from biomass. Hamilton referred to a May 23 Congressional energy policy hearing as a "lovefest" for renewables--at least 30 congressmen were there--and she does expect funding to increase. "Every year we win a fight on the floor of the House and on the floor of the Senate for restoring funding," she says. "It's hard for people to vote against this stuff."

Thus far, scientific advances, largely as a result of DOE-funded research, haven't been enough to make large-scale cellulosic biomass plants a reality. "The problem is, in the United States, the model for funding these types of plants doesn't exist," says Arnold Klann, president of Arkenol, in Mission Viejo, Calif. This company is focusing on using concentrated acid hydrolysis technology along with a benign variant of Z. mobilis that's produced by NREL. Arkenol has a pilot plant in Orange County, Calif., but has looked overseas to take the next step. They're working on a joint venture with the Japanese government and the JGC Corp. in Japan to build a semi-works plant starting in September. Arkenol has been researching Z. mobilis for several years with help from the NREL. "To date," says Klann, "the U.S. government has come [up] short on bringing the kind of incentives to get these plants built."

Clinton Norris, executive vice president of BC International Corp., agrees, though he claims his company's U.S.-based plant is "on a path" toward securing funding for its cellulosic biomass plant in Jennings, La. Norris, who was encouraged that the Bush administration plan devoted a whole chapter to biomass, says that BCI has agreements with several financial institutions and expects to have several more. The $90 million facility will derive ethanol from materials including sugarcane residues, rice hulls, and forestry wastes using Ingram's engineered E. coli. BCI also hopes to build a plant in California where farmers, who once burned rice straw, are dealing with stricter regulations on air quality standards and the increased threat of accidental forest fires. A California ban on the petroleum-based gasoline additive oxygenate methyl tertiary-butyl ether (MTBE), known to contaminate groundwater, also makes cellulosic biomass ethanol more attractive as a gasoline additive. The Masada Corp. also plans to break ground on a facility this summer in Hamilton, N.Y., assuming it can secure financing. The plant uses acid hydrolysis and a proprietary combination of microorganisms to break down all types of organic municipal waste, from newspapers to apple cores.

Klann notes that several investment bankers in this country and abroad have approached Arkenol about financing commercial cellulosic biomass plants once the technology is proven viable on a large scale, but too few investors will risk spending the money before that happens. Says Norris, "An awful lot of people would love to be the first to be second."

Eugene Russo can be contacted at erusso@the-scientist.com. References 1. R.G. Lugar, R.J. Woolsey, "The new petroleum," Foreign Affairs, 78:88­102, 1999.

2. N.W.Y. Ho et al., "Genetically engineered Saccharomyces yeast capable of effective cofermentation of glucose and xylose," Applied and Environmental Microbiology, 64:1852­9, 1998.

3. A. Asghari et al., "Ethanol production from hemicellulose hydrolysates of agricultural residues using genetically engineered Escherichia coli strain KO11," Journal of Industrial Microbiology, 16:42­7, 1996.