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New Zealand firm receives $12 million grant for pilot-scale production of biofuel from carbon monoxide

July 15, 2008

In New Zealand, LanzaTech received a $12 million grant to research the biofuel potential of a process that uses bacteria to produce ethanol from carbon monoxide. The company will construct a pilot-scale plant that will be complete next year. The company said that its fuel could be used in blends up to 90 percent without adverse impact on engine performance. The New Zealand government also awarded a major grant to a university-based team that will research the production of syngas and renewable diesel from wood and agricultural residues.

New Zealand background

A parliamentary select committee recently reduced the Government’s 2012 biofuel target from 3.5 to 2.5 percent, citing environmental concerns. The opposition National Party opposes the bill, saying it will cost consumers $240 million. The target was reduced after projections for New Zealand corn production were lowered. The bill does not include a sustainability standard.

Pure Power said that it will make cuttings of Salix, a varietal of willow, available to farmers in 2009 who will grow the crop as feedstock for Pure Power’s cellulosic ethanol production facility. Pure Power said that it has embarked on an extensive education effort related to breeding, breeding and propagation of Salix, plantation establishment, plantation management, harvesting and pest and disease control for the feedstock. Pure Power entered the cellulosic ethanol sector with its acquisition on BioJoule last December.

The Parliamentary Commissioner for the Environment said in April that the Biofuel Bill should be rejected on the grounds that biofuels may be worse for the environment than fossil fuels. The Biofuels Bill called for a 1 percent blending mandate starting in 2008, and rising to 3.4 percent by 2012.

BP testified earlier this month that biofuel requirements proposed to take effect July 1st would result in a price increase of 27 cents per gallon or more, for diesel and gasoline.

The oil refiner said that the cost increase, on a target of 0.53 percent biofuels content in 2008, rising to 3.4 percent in 2012, would come as a result of infrastructure requirements to move and store the fuels, primarily the building of storage and blending facilities in multiple terminals. Oil companies face a fine of as much as $20 million for missing their obligations, rising to $30 million by 2012

New Zealand’s Prime Minister Helen Clark has committed the government to use B10 blends or electric power for 80 percent of its fleet by 2015, and the country has a 3.4 percent biofuel mandate target for 2012.

In August, a 10 percent ethanol blend went on sale in New Zealand, prompting strong public support from the Green Party while the Director of New Zealand’s Advanced Energy and Material Systems Lab called biofuels a “waste of time and money”.

Seven NZ-based companies have formed the Biofuel Manufacturers Association to oppose entry of US biodiesel into the market. The manufacturers said that the introduction of subsidized US biodiesel into Europe caused massive shutdowns and capacity reductions among European biodiesel manufacturers.

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    Written by Jim Lane · Filed Under International 

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