Company Claims Potential Magnification In Bio Fuel Production

duanes1967 writes "A company called Joule Biotech claims to have a breakthrough in biofuel production. Their process can create 20,000 gallons of fuel per acre per year at a cost of about $50 per barrel. 'Algae-based biofuels come closest to Joule's technology, with potential yields of 2,000 to 6,000 gallons per acre; yet even so, the new process would represent an order of magnitude improvement. What's more, for the best current algae fuels technologies to be competitive with fossil fuels, crude oil would have to cost over $800 a barrel says Philip Pienkos, a researcher at the National Renewable Energy Laboratory in Golden, CO. Joule claims that its process will be competitive with crude oil at $50 a barrel. In recent weeks, oil has sold for $60 to $70 a barrel.'"

Comments

It's always a startup...

[EmagGeek]

... begging for money that comes up with these "revolutionary" breakthroughs. Did we not learn anything from the tech boom/bust?

Whenever there is a lot of government money flowing into an industry, there is never a shortage of snake-oil salesmen lining up to grab a piece of it. There really isn't a limit to what they will say they can do.

Re:It's always a startup...

[Andr T.]

Nah, say whatever you want, skeptic. When my ORBO arrives, I'll be the one laughing!

Re:It's always a startup...

[interkin3tic]

... begging for money that comes up with these "revolutionary" breakthroughs. Did we not learn anything from the tech boom/bust?

Are you saying we were supposed to learn that revolutionary breakthroughs are ALWAYS snake-oil?

Why not save all the time and confusion

[jeffmeden]

Just brand this as "$50/barrel oil derived from harvesting common, readily available snakes and processing them in a revolutionary (and certainly patent-pending) way".

Uhh, Heavily Bought Into By Oil Industry

[eldavojohn]

... begging for money that comes up with these "revolutionary" breakthroughs. Did we not learn anything from the tech boom/bust?

Whenever there is a lot of government money flowing into an industry, there is never a shortage of snake-oil salesmen lining up to grab a piece of it. There really isn't a limit to what they will say they can do.

You may want to inform Exxon Mobil that their recent six hundred million dollar investment is snake oil.

Big oil's investing in this, I wouldn't write it off as snake oil:

• ExxonMobil - Venter, Synthetic Genomics
• BP - just announced a partnership with DuPont to develop butanol; Qteros, Verenium, Synthetic Genomics
• Valero - purchased seven VeraSun plants out of bankruptcy earlier this year; Qteros, ZeaChem, Solix
• Marathon - Mascoma (also backed by GM)
• Shell - Iogen
• Total - Gevo

Re:Uhh, Heavily Bought Into By Oil Industry

[amRadioHed]

Biofuels solve two major problems, they are carbon neutral and they are not dependent on the middle east. Are the problems they create worse than those?

Re:Bullshit

[Bombula]

Oops, my bad, I read 40,000, not 20,000. So their actually at 10% efficiency, which while unlikely at least has the merit of not being theoretically impossible.

If this works

[xs650]

we should name a unit of energy after the company

big oil is not stupidly evil

[OrangeTide]

They are greedy. they are in a for-profit business. Once we realize that green investments by most of the big oil companies is not some show to appear green, and really a strategy for them to continue operating refineries it all starts to make sense. If the big oil companies have to buy unprocessed biofuels from New Mexico and Arizona instead of shipping it from the Gulf of Mexico and the Middle East, who cares. As long as the fuel is good and cheap they can build or convert refineries to process it. Ultimately the big oil companies are in the business of refining matter to make it usable in an internal combustion engine.

Given the assumption that big oil wants to survive (and thrive) and continue profiting. The myth that big oil wants to suppress innovation because they have some sort of warped ideology where they hate the Earth and the environment. (sorry, capitalists are nothing like the villains on the Captain Planet cartoon from the 1990s)

While I have no proof, I think an argument could be made where big oil does suppress, or at least has motive to suppress, innovation that makes it easy for any individual or small start up to transport people and materials without the the use of products from big oil's refineries. This sort of conspiracy at least fits big oil serving their own self interests. The other conspiracies where big oil spends a billion dollars on "green" investments as a PR stunt seems far less likely, because it uses money so inefficiently.

Re:big oil is not stupidly evil

[Bruiser80]

If that is true, why are wells with lots of available oil across the country not being pumped? If it were true that they weren't looking towards the future, they would not consider this "easy" oil an asset for future use. It would be cheaper to pump that oil now than to pay $70/bbl from the mid-east. However, in the future, that oil could be pumped when the mid-east is charging $200/bbl.

If they perceive a shortage of oil, which would lead to inflated prices, it would be in their best interests to determine a way of getting oil. If one path leads to profits now, but bankruptcy in 10 years, that's not good business. The most profitable path is the one that is sustainable for the company.

Re:big oil is not stupidly evil

[tsotha]

There is no commitment to "future shareholders", only current ones, so no the company has little incentive to do anything aside from very short term "investment".

This is just silly. And wrong. If oil companies only cared about profits in the next quarter, how do you explain expenditures of hundreds of millions of dollars on a new oil field? It takes at lest three or four years to bring a new field online, not counting exploration. And how do you explain drug companies researching drugs that won't hit the market for almost twenty years, if ever?

Companies have a commitment to future shareholders in the sense that what people think a stock will be worth in the future is the major determiner for what it's worth today. That's why Intel builds new fabs, drug companies research drugs, and oil companies spend money trying to insure they'll have a product to sell when they start running out of oil.

Let's do the math...

[rayharris]

Assumptions:
- They can actually generate 20,000 gallons per acre per year
- 1 gallon of biofuel will get you the same mileage as 1 gallon of gasoline

US gasoline usage = 378,000,000 gallons/day = 137,970,000,000 gallons/year
Source: http://www.eia.doe.gov/basics/quickoil.html

Area needed: 137,970,000,000 gallons/year / 20,000 gallons/acre/year = 6,898,500 acres = 10,779 sq.mi.

Comparative area: Massachusetts is 10,555 sq.mi.

So, we'd need an area slightly larger than MA to generate the needed biofuel. This may seem like alot, but...

Farmland in US: 922,095,840 acres = 1,440,774 sq. mi.
Source: http://www.ers.usda.gov/StateFacts/US.htm

Percent farmland to convert to biofuel: 10,555 sq. mi. / 1,440,774 sq. mi. = 0.73%

This isn't much, if you ask me.

Now, for the financial incentive to do so:

Value of 20,000 gallons of biofuel at $50/barrel: 20,000 gallons = 476 barrels * $50/barrel = $23,000

Corn yield of one acre: 162 bushels/acres (Iowa)
Source: http://www.extension.iastate.edu/agdm/crops/pdf/a1-14.pdf

Value of 162 bushels of corn: 162 bushels * $4.77/bushel (Estimated 2008 Calendar Year Average) = $772.74
Source: http://www.extension.iastate.edu/agdm/crops/pdf/a2-11.pdf

So, converting one acre of corn farmland to one acre of biofuel farmland will increase the revenue from $773 to $23,000, a nearly 30-fold increase.

So, this looks like it might be worth it depending on the cost of conversion and cost versus revenue. It'll certainly be interesting to watch.