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.

Wan and his team created a tabletop algae pond in their lab — in this case, a raceway pond design — and monitored the growth of a type of algae called Chlorella kessleri under certain light and temperature conditions. They then replicated the setup, only this time they circulated the algae in the pond through an area that was exposed to low-level static magnetic fields. An electromagnet was used in this experiment, though Wan says they could have also used a permanent magnet no stronger than a typical fridge magnet.

So what did they observe? Seems algae thrive under a certain level and length of exposure to magnetic fields. Wan’s team, in fact, found a level of optimum exposure that led to a quadrupling of growth of the biomass, the oil inside the algae and in-cell antioxidants, such as Astaxanthin. Wan believes the approach could be used to help boost algae production for both biofuel production and the production of food supplements based on the antioxidant nutrients found in algae.

Actually, while this is a potential benefit for biofuels, Wan sees a much larger opportunity to use magnetism to boost growth for the production of high-value products — i.e. chemicals and nutrients (such as Astaxanthin) that can fetch much more in the market than biofuels. His research is expected to appear later this year in the peer-reviewed journal Bioelectromagnetics.

Wan isn’t the first to observe this phenomenon. Researchers have been exploring the effects of both magnetism and low-level frequencies on simple-cell organisms such as algae and bacteria for a few years now, and in most cases they have observed growth stimulation. This study provides a good overview of that earlier research.

The Canada-Wide Science Fair was recently held and, as usual, there were some terrific projects from some terrific young minds. One in particular was a project by Grade 9 Havergal student Mikaela Preston called “A Population Dynamics Study in Algal Bioreactors.” Preston, working with Dr. Brad Bass at the University of Toronto and representing Ontario (York Region) in the fair, won the platinum award. She had learned that most research on algae as a possible source of biofuel is based on the study of specific strains or monocultures. But would algae growth benefit by mixing strains? That’s what Preston wanted to find out, so she went ahead and grew two different types together and found that, yes, the different algae strains grew better together than apart, suggesting that mixing strains may be a better and ultimately more economic approach to producing biofuels from algae.

Congrats Mikaela, let’s hope 10 years from now you’re leading research in this important area. We need kids like you that are engaged in their energy future.

Team Ontario walked away with the fair’s top prizes, including “Best in Fair,” platinum awards in each of the junior, intermediate and senior levels, and 13 Gold Awards.

Also, I had a chance to attend a panel at the BIO World Congress conference in Toronto this week on the challenges of producing renewable jet fuel. The panellists all agreed that producing low-carbon jet fuel from algae, jatropha, camelina and wood was not only technically doable but could be done economically. The potential problem, as one panellist pointed out, is that producers may opt first to make higher value products, such as green chemicals and nutriceuticals, which can fetch a much higher price per litre and, by association, a higher profit. In other words, we can make the green jet fuel, but will we use it as jet fuel?

So far, that’s Rentech’s intention — but will it change its mind? Either way, from a climate perspective, the end product will still presumably displace petroleum-based feedstocks, so it would seem all good in the end.

I had the opportunity this week to visit a St. Marys Cement plant in the small and scenic town of St. Marys, Ontario. A subsidiary of Brazilian cement giant Votorantim Cimentos, the company is working with Toronto-based Pond Biofuels on a project that turns smokestack emissions from the plant into algae. The algae, based on a strain taken from the local Thames River, gobble up CO2, SOx, NOx and other pollutants that are piped into special algae photobioreactors, two of which are housed in a pilot facility located beside the plant. The algae are harvested and can be dried using low-grade waste heat from the cement plant’s kilns. The dried algae can then be burned in the plant’s kilns instead of petroleum coke, helping to reduce the plant’s CO2 emissions. Alternatively — and if the economics justify it — the algae can be processed into biodiesel and other green fuels/chemicals.

I decided, for the first time, to take a video camera with me and film a walkthrough of the pilot facility to give my readers a better sense of how this all works. I’m new to this whole video and movie editing game, but I did manage to put something decent together, which I post here as a YouTube upload. It’s nearly 10 minutes long, but if you’re interested in the process you may find it worth watching. Like I said, it’s my first time doing this — I would appreciate any constructive feedback.

The column begins with a look at a company in Halifax, Nova Scotia, called Ocean Nutrition Canada. Its core business is making Omega-3 fatty acid supplements, and its the largest supplier of this product in the world. But recently company scientists stumbled upon an interesting form of algae after screening hundreds of ocean microorganisms. They discovered a heterotrophic algae, in reality a protist, that is 60 times more productive at making oils than other types of algae that rely on sunlight and CO2. Heterotrophs, like humans, grow by eating carbon-based materials. Ocean Nutrition Canada, which has patented the unique organism — called ONC T18 B — was approached by some folks in the biofuel industry and encouraged to lead a project consortium funded by Sustainable Development Technology Canada and which includes the National Research Council and Lockheed Martin. They plan to demonstrate they can grow the algae on a large scale using a waste stream feedstock. Project partner Honeywell UOP will convert the algae oil into jet fuel.

Honeywell UOP is also involved with another SDTC project aimed at producing jet fuel, this one based on camelina oil. Targeted Growth Canada of Saskatchewan is heading that consortium, which includes Bombardier and Pratt & Whitney Canada. Early next year, the first test of that fuel will take place in a Porter Airlines Bombardier Q400 turboprop, which typically fly out of Toronto’s island airport.

But let’s assume, a decade out, that all the promise of CCS pans out. Let’s assume it takes hold, that a vast network of pipelines is built, that we’re certain sequestration sites won’t leak, and that the percentage of CO2 we can capture from coal plants and industrial sites continues to improve. Let’s assume that two decades out we start to see a number of acquifers and old oil fields filled to capacity with CO2 and, finally, capped shut.

Think those storage sites will be forever permanent? Think again.

I was talking recently with someone heading up a government algae-based carbon recycling program. The goal of this program is to come up with an economic way to divert CO2-rich flue gases from industrial sites and coal plants to nearby enclosed algae farms. The algae would “eat” the CO2, grow quickly, and then be harvested to make a combination of products, from biodiesel and ethanol to protein feed for livestock. I’m probably not telling you anything new — there are dozens of companies out there trying to do the same thing.

But then this person, who shall remain nameless, says something that caught my attention. He called all those storage sites “gold mines of the future.” At first I didn’t get what he was saying, then I realized the significance of that comment. He was basically saying that, down the road, algae farms could be created right on top of CO2 storage sites. The farms could be designed to pump this CO2 back to the surface, giving them a predictable stream of relatively pure algae food. An earlier scenario would be to build these algae farms at CO2 pipeline hubs. Either way, it would be much more economical than building an algae farm/processing plant next to each and every coal plant or aluminum smelter.

There’s a part of me that loves this idea, and there’s a part that asks: Shouldn’t we leave this stuff alone? Sure, the biodiesel and ethanol and other chemical products made from this algae will presumably displace the use of oil down the road. But given that, long term, we’re going to need an 80 per cent reduction in CO2 emissions globally, developing infrastructure for this would seem to undermine this target.

It made me realize that short- and medium-term ideas, despite there merit, need to be considered as part of a larger long-term picture. CO2 stored, assuming we can ever make it work to the scale that’s necessary, is probably best if capped shut and left alone.

Air New Zealand has been making some serious progress on that front with its partners Boeing, Rolls-Royce and UOP (Honeywell). A team led by Rolls-Royce is putting a jatropha-based jet fuel through rigorous tests to further validate what preliminary data has so far shown: that the fuel meets all required specifications for commercial aviation. Once testing is completed later this fall, and assuming all conditions are met, the new fuel will be tested on an Air New Zealand Boeing 747-400 sometime in December. The jetliner will be powered by four Rolls-Royce engines, one of which will run on the Jatropha-based jet fuel.

Jatropha plants grow about three metres high and produce seeds that contain an inedible oil. The oil can make up 40 per cent of a seed’s mass. The reason Jatropha is considered ideal for biofuel production is that it’s hardy, resistant to drought and pests, and can be grown on land that generally isn’t good enough for food crops. Seriously — this stuff can grow in sand, gravel, even rock crevices.

The partners in the Air New Zealand project have set high standards for the fuel they’re using in an effort to avoid the kind of criticism that has been aimed at corn-based ethanol. “Firstly, the fuel source must be environmentally sustainable and not compete with existing food resources,” according to an airline press release. “Secondly, the fuel must be a drop-in replacement for traditional jet fuel and technically be at least as good as the product used today.  Finally, it should be cost competitive with existing fuel supplies and be readily available.” Air New Zealand has said that 10 per cent of its jet fuel will come from jatropha-based biofuel by 2013.

Meanwhile, Wired’s Autotopia cites a Boeing executive saying that green jet fuel could start powering commercial jetliners as early as 2011 — much faster than most experts have suggested. Algae is also being developed as a feedstock for jet-fuel production, and companies such as Solazyme are leading in this area. But Boeing believes jatropha-based jet fuel will be the first to fly. Joe Romm, commenting on the Wired article at Climate Progress, said jet biofuel will need to be competitive with oil at $100 to $150 a barrel, “if we are going to start to see significant market penetration, I think, though a very serious carbon price would certainly help — assuming that such a carbon price was applied to the airline industry, which is far from certain anytime soon.”

Last year J.P. Morgan & Chase estimated that a barrel of jatropha-based jet fuel could be produced for $43. I think airlines around the world will be watching Air New Zealand closely in December when it makes that three-hour test flight.