From a greenhouse-gas perspective, the emission reductions aren’t massive — up to 25 per cent reduction — but the real gains here are in the reduction of smog-causing pollutants. Nitrogen oxides and diesel particulate matter are reduced by 90 per cent. Over time, it leaves open the possibility of using renewable natural gas, sourced from landfill gas and municipal wastewater biogas, to displace its fossil fuel cousin. The city of Surrey, B.C., is already heading in this direction. It now requires that natural gas-powered trucks be used for its municipal waste collection, a service being performed by BFI Canada, which has purchased 75 trucks that run on CNG. At the same time, it is launching an organics collection program for Surrey’s 470,000 residents and businesses that will see the household waste converted into biogas that will be cleaned, conditioned and used in BFI trucks. Surrey hopes the new biogas facility will begin operation in 2014.

Toronto was supposed to head in this direction as well, but from what I understand the plan has unraveled under the administration of Mayor Rob Ford.

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By Tyler Hamilton

About seven million tonnes of grain corn was grown in Ontario in 2011, and by year’s end roughly 30 per cent of that is expected to go toward ethanol fuel production.

Let’s ignore for the moment the whole food-versus-fuel debate, and assume that devoting nearly a third of Ontario corn production to making renewable fuel doesn’t help drive up global food prices, or for that matter, reduce our capacity to feed the world.

Let’s focus instead on the use of corn as part of a greenhouse-gas reduction strategy that returns more economic value per harvested bushel. Through this lens, is biofuel production the best use of a renewable but also land-limited resource?

Corn, after all, doesn’t have to be made into ethanol and burned in the gas tanks of our cars to reduce our dependence on fossil fuels. It can also be used to make a variety of “green” chemicals that form the basis of a wide variety of products currently made from petroleum-based chemicals.

Let’s take, for example, Burlington, Ont.-based EcoSynthetix, which takes starch from corn to make certain biopolymers. These biodegradable biopolymers can displace petroleum-based ingredients used to make coatings for packaging and cardboard, adhesives, carpet backing, building materials and a wide range of other products.

John van Leeuwen, chairman and chief executive of EcoSynthetix, which had a successful initial public offering on the Toronto Stock Exchange in August, says he can make $35 worth of biolatex for every bushel of corn the company consumes in its process.

Ethanol, by comparison, fetches about $10 for every bushel of corn, he says. Indeed, the amount of corn that’s consumed annually by 10 large ethanol production plants – out of about 200 in North America—could probably supply enough starch for the entire emulsion polymer market worldwide if it were to switch to 100 per cent biopolymers.

More than that, EcoSynthetix’s biopolymer can compete head on with petroleum-based polymers that currently dominate the marketplace, unlike the heavily-subsidized ethanol industry. “We don’t need subsidies. We can actually go into a deal and offer a discount against petroleum-based products to win business,” says van Leeuwen.

Asked about the growing volume of corn consumed by the ethanol industry, van Leeuwen, without pointing fingers, responds sensibly. “We really need to be thoughtful as an industry to make sure what we make derives maximum value from our agricultural feedstocks.”

Such wise advice could be directed to Canada’s bioproducts sector as a whole, which as I wrote in August has been shrinking when it should be flourishing. That was the conclusion of a report by the Richard Ivey School of Business, which called Canada’s performance on the global stage “disappointing.”

In that report, ethanol represented more than two-thirds of Canada’s bio-products market, while higher-value polymers accounted for just 2 per cent and organic chemicals 12 per cent. In the area of green chemicals, Canada’s landscape was described as “stagnant.”

This isn’t just about corn; it’s also about how we choose to use agricultural residues, municipal organic waste, wood waste, algae biomass, and non-food crops.

Does it make sense to just burn this material for energy, or convert it into fuel so it can be burned? Or, should we be doing a better job of targeting niche markets with high-value “green” products that are just as effective at reducing our dependence on fossil fuels?

“There is an overemphasis on biomaterials as a source for energy,” says Dr. Rui Resendes, executive director of Kingston-based GreenCentre Canada, which helps commercialize green chemistry innovations coming out of Canadian universities.

And that energy isn’t as green as often claimed. After all, Resendes points out, the fertilizers used to grow crops are petroleum-based, as are many other products consumed along the supply chain.

“Just because you pluck it out of farmer’s field doesn’t mean it’s sustainable,” he says, adding that the entire value chain has to be considered. This is where green chemistry and the products it supports play a crucial role. “I’m a firm believer in technologies that are addressing niche markets where volumes are much smaller and margins are much higher.”

Green chemicals may be a broad category, but it’s one that serves highly targeted markets where petroleum-based products currently dominate, including the manufacture of fertilizers, polymers, and lubricants, to name a few.

And, as EcoSynthetix is demonstrating, you can be competitive and aim for profitability without relying on subsidies.

This isn’t to suggest we abandon biofuels. Renewable jet fuel, for instance, is emerging as an attractive subcategory of green fuels and fulfills a role that electricity, while an alternative source of energy for consumer vehicles, simply can’t based on current-day technology.

But certainly Canada can have a much more balanced portfolio, and that means doing a better job of nurturing our green chemistry sector, and – in the particular case of corn – getting more pop per kernel.

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies.

Mad Like Tesla: Underdog Inventors and Their Relentless Pursuit of Clean Energy was launched this month and has been well-received. The reviews so far have been positive, and awareness of the book is slowly building. But not fast enough. I want to take this moment to ask my readers, many of whom have already purchased the book (thank you!), to help spread the word. Share this link or the Mad Like Tesla website (www.madliketesla.com) on social media sites such as Facebook and Twitter. Refer to it when commenting on the various blogs you might follow. And for my media friends out there — whether in the mainstream press or the blogosphere — please consider a review, or alternatively, I’m happy to chat about the many odd and inspiring stories in this book. Please see press release here.

Thank you all for your ongoing interest and support. BTW: Many have asked, so I’m happy to report that the e-book version of Mad Like Tesla is now available at Amazon.com.

What’s going on? Well, for one the bulk of bioproducts made in Canada are first-generation biofuels, such as corn ethanol, or other forms of bioenergy. We don’t give enough support to biochemistry research and product development, or higher value non-fuel markets such as alternative plastics, which in my view are much more exportable down the road. We are throwing money at corn ethanol and not doing enough to support and help commercialize next-generation biofuels produced from algae or cellulosic conversion technologies.

I’m pasting my column below, though before you read there are some caveats here. The data analyzed doesn’t cover the past two years, so there may be some positive signs not accounted for in this report. Also, Ontario appears to be doing much better than the rest of Canada, though this is not to suggest there’s enough being done in Ontario. Anyway, I think this report is an important wake-up call for Canada. Sure, we’re blessed with forestry and agricultural resources, but are we satisfied just growing and selling commodities? Are we going to continue down the path of selling our raw natural resources to other countries, only to purchase it all back in the form of higher-value products? Once again, Canada lacks a vision and has no real plan to lead the world on bioproduct development, even though it has the capacity to do so. Click below to read the full column:

Tyler Hamilton

Canada — and Ontario specifically — has a number of innovative companies that are turning agricultural and forestry biomass into new products, and in doing so reducing our dependence on petroleum.

Ottawa-based Ensyn has developed a system that converts wood waste into a form of renewable oil used to make transportation fuels and food products. GreenCore Composites of Toronto creates “biocomposite” materials out of wood residue and agricultural fibres, such as hemp and flax, to make everything from automotive parts to patio furniture.

GreenField Ethanol of Toronto has grown to become the largest independent corn ethanol producer in the country and leading developer of cellulosic systems that make ethanol from agricultural and wood waste. California firm Rentech, meanwhile, has chosen Ontario to open a new plant that will turn forest residue into green jet fuel.

The list goes on. Mikro-Tek of Timmons can make trees grow faster, and therefore store more carbon, by inoculating the roots of seedlings with naturally occurring fungi. EcoSynthetix of Burlington makes a “biolatex” product out of corn and potatoes that is a direct replacement for oil-based latex, such as plastic coatings used on consumer product packaging.

These companies are all part of an emerging sector with huge potential, given Canada’s immense natural resources. Unfortunately, the sector is shrinking, not growing, and has been for several years.

It’s a worrisome trend against a backdrop of global growth, one that a trio of researcher led by David Sparling, chair of agri-food innovation and regulation at the Richard Ivey School of Business, highlighted in a recent report titled Not Enough Green in Canada’s Bioproduct Industry.

Taking data from Statistics Canada collected between 2003 and 2009, Sparling and colleagues found that the number of companies in the sector dropped to 208 from 239, revenues from bioproducts fell by more than 60 per cent, export revenues plunged, and R&D spending dropped by nearly half.

“The significant declines in bioproduct revenue, exports and R&D present a disconcerting counter-point to the general perception that Canada is moving rapidly toward a new bioeconomy,” according to the report.

It gets worse. In 2003 the sector employed nearly 8,000 people. Six years later that number dropped to near 3,000 workers. Firms in the sector were also starved of capital, raising barely 60 per cent of what they needed to execute on growth strategies.

So something is clearly wrong. “The survey results to 2009 can only be described as disappointing and suggest that somehow Canada is missing its potential in bioproducts,” Sparling and colleagues wrote.

They pointed out that the bulk of Canadian activity – slightly more than two-thirds – came from ethanol production. This dependence on a single product suggests we are neglecting the huge global potential of the bio-based chemical market.

“The current estimate of worldwide market potential for these chemicals is $164 billion (U.S.),” they wrote. “Yet, as the global industry begins to take shape, making strategic investments in technologies, companies and locations, the landscape in Canada remains stagnant.”

One possible reason is that we have failed to create market demand within our own borders, even with respect to next-generation biofuels – that is, the stuff not made from corn.

This week, for example, it was reported that the U.S. Department of Energy and Department of Agriculture, in partnership with the U.S. Navy, would invest half a billion dollars over the next three years to speed up production of biofuels made from non-food inputs, such as algae.

But this deal is more than just stimulating supply. As part of the deal, the Navy would be the customer. The White House is basically saying “Build it and we will come; make it and we will buy it.”

Canada has made no significant efforts to stimulate such demand. Our own armed forces, potentially one of the largest buyers of Canadian biofuels, are missing in action. So, too, is the federal government when it comes generally to bioproducts.

As Sparling concluded, Canada has failed to turn its natural advantages into a successful industry because it lacks a vision and a plan. “This lack of vision leaves Canada vulnerable to others who can move quickly to seize its natural resources and turn them into value-added commodities and products that Canadians will ultimately buy as foreign-made good.”

There is a silver lining, however. Ontario isn’t doing as badly as the rest of the country. The number of firms producing bioproducts has actually grown, and Ontario firms continue to increase patent filings, creating a base of intellectual property from which to exploit.

It’s something to build on.

Tyler Hamilton, author of Mad Like Tesla, writes weekly about green energy and clean technologies.

Why Mad Like Tesla? That’s explained in the introduction, but in a nutshell Serbian-American engineer Nikola Tesla invented many important technologies in his lifetime. yet he faced constant struggle against naysayers and skeptics who couldn’t, at first, grasp the significance of what he was sharing with the world. Many dismissed Tesla as a mad scientist, and yet his inventions shaped the world largely for the better. So, in my view, if someone today is mad like Tesla, that’s not necessarily a bad thing. It’s quite a good thing, actually — we need more of these people, for the changes necessary in our world will not come from the kind of cautious, incremental steps being taken today.

I have a website for the book in the works, but it won’t be ready until end of August.

Thanks for your support!

It’s an interesting question: Would you, as a consumer, be more likely to purchase a product in a retail store if you knew the energy used to produce it could be guaranteed as zero- or low-carbon?

I know I buy unbleached coffee filters, low-salt cans of tuna and organic veggies because it matters to me, so it follows that some people would be swayed by carbon content. They might not pay more for it, but price being equal, it could give one product a competitive edge over another. On the other hand, is there really any room on product labels to fit this information? How would it be presented in a simple way that doesn’t confuse people? What standards are used to measure the carbon content of energy inputs? Can such a label be exact enough to matter?

BTW: Why the “cows” reference in the headline? That’s because I open the piece with a look inside the operations of Delft Blue, a veal farming company in Ontario that turns cow manure into electricity and heat. So, in a sense, Delft is supplying the market with low-carbon veal. It’s doing so because the capital investment lowers the cost of its farming operation and achieves payback in five or so years. However, its customers — Walmart, Loblaws, etc. — could choose to market the veal as low-carbon if they chose. At the moment, they don’t.

Enerkem is proving to be a Canadian waste-to-energy success story. It has several projects under construction and in the pipeline and it has managed to attract top-tier strategic investors and VCs. Valero is a good catch. It has 10 ethanol refineries across the United States, making it the largest supplier of ethanol in the country. It also has made several investments in next-gen ethanol technology companies, including Mascoma, Zeachem, Terrabon, Solix Biofuels — and now Enerkem. “With Valero joining Waste Management as a strategic investor, Enerkem becomes one of the very few renewable products companies that is aligned with industry leaders from both upstream and downstream parts of the business,” said Vincent Chornet, president and chief executive officer of Enerkem, in a press release.

A good sign that more will happen was the announcement yesterday that Anaergia, which operates in Europe under the name UTS Biogas, has chosen Ontario as the location for its $70-million global headquarters, which will include R&D and manufacturing. The company expects to hire 200 people, and it plans to support and drive growth in biogas systems across Ontario and presumably the rest of Canada and northeastern parts of the United States. “The industry, in my view, is still in its infancy,” Andrew Benedek, company CEO, told the Toronto Star. “It has not evolved technologically. I really see an opportunity to become far away the leader of the world.” Benedek, a Canadian citizen, has a track record for running successful cleantech businesses. He was previously founder of Zenon Environmental, the Ontario-based water treatment company that went on to be purchased by General Electric in 2006 for about $700 million.

This is another healthy sign that the Green Energy Act and FIT program, despite their fixable problems and Hudak-spun controversy, are luring future-looking investments and jobs to the province.

Rentech’s approach is to gasify the biomass, condition the resulting synthesis gas (syngas), then convert it into jet fuel and naphtha using a Fischer-Tropsch process. The plant, called the Olympiad Project, is being designed to produce approximately 85 million litres (23
million gallons) annually of renewable and certified low-carbon jet fuel. Rentech will get its biomass from Ontario crown land through a deal with the province. In total, Rentech will have access to up to 1.1 million cubic metres (1.3 million U.S. tons) of Crown timber per year. The company has applied to receive up to $200 million in funding from Sustainable Development Technology Canada’s NextGen Biofuels Fund. That amount is expected to be paid back over time from project cash flow.

The ultimate impact of this fuel on the environment, according to Rentech, will be a reduction of 600,000 metric tonnes per year of CO2-equivalent emissions. “This equates to removing more than 100,000 passenger cars from the road,” the company says. The green jet fuel is “virtually” free of sulfur and aromatics. It has lower particulate matter, NOX and  SOX compared to conventional jet fuel (kerosene). The fuel is certified and was tested in 2010, though as a mix that contained 40 per cent conventional Jet-A fuel.

Anyone who has read this blog knows that I’m a big supporter of developing biofuels specifically for aviation purposes and adopting an electrification strategy for light-duty vehicles. We can’t electrify commercial airliners or military jets, so greening up those fleets will require some sort of biofuel solution. The bonus is that distributing this green jet fuel to airports is much easier than delivering to the thousands and thousands of gas stations across North America. Rentech, for instance, could do a deal with CN rail, which delivers jet fuel directly to Pearson International Airport in Toronto.

I plan to chat with Rentech’s CEO this afternoon to get more detail about where the company plans to sell its green jet fuel and related products. Also, next Tuesday, there will be a panel on bio-jet fuel innovation at BIO World Congress in Toronto. I plan to attend and will report back.