[social_buttons] Ceres, Inc. supports the prediction that we could grow more than 30% of US transportation fuel with dedicated energy crops. This is no pipe dream: planting starts next spring.
Ceres, Inc., the self-described “energy crop company,” is engineering plants that could play a big role in the future of sustainable biofuels. In stark contrast to food crops, what Ceres is in the business of creating are “dedicated energy crops”—like switchgrass, sorghum, and miscanthus—that are ideally suited for fuel production.
While the global “food vs. fuel” debate rages on, a few companies like Ceres are quietly moving forward with next generation technology that challenges many of the current assumptions about growing fuel. In their view, it’s time to move the conversation on from corn-based controversy to second-generation, non-food based sources of ethanol.
What Ceres is Doing
Ceres is a biotechnology company using genetic engineering and standard plant breeding techniques to create the most efficient and productive biofuel feedstocks possible. Basically, they’re using techniques developed and applied in the Human Genome Project to sequence and manipulate plant DNA.
According to material provided by Ceres (see video of the presentation at GMNext.com), the company is one of the world’s leading plant genomics firms with a proprietary collection of more than 70,000 genes from numerous plant species. You may have heard the company’s name before, since Monsanto has been paying for Ceres’ technology for years.
But Ceres is now looking to capitalize on the potential of biofuel crops by producing species that grow bigger, faster, and more cheaply. They’re trying to maximize the number one criteria for any fuel crop—how much plant it produces on an acre of land—while minimizing the need for fertilizer and other inputs, and optimizing the ease in which the crop can actually be converted into ethanol.
Unlike growing an ear of corn, Ceres doesn’t care about increasing the number or size of starch-containing kernels. They’re interested in biomass: the leaves and stalks of the plant that contain everything else. (For more information, see previous post describing how cellulosic ethanol is produced from biomass.)
The Business Plan
If you thought cellulosic ethanol was just another pipe dream, note this: Ceres will be selling switchgrass seeds to farmers this year for the spring 2009 planting season. Besides a number of varieties of switchgrass, they’ll also be selling sorghum and miscanthus, all under the brand name Blade.
To plant an acre of switchgrass, a farmer will need about 5 lbs of seed for a total cost of about $100 per acre. But a perennial crop like switchgrass is only planted once every 5-10 years, since it grows back from the same root system over and over.
So how will Ceres make money?
Taking a brief look at their business materials, it’s clear that Ceres already has a diverse portfolio of available plant seeds for sale, combined with a virtually untapped and potentially explosive market for next-generation biofuels (not to mention the proprietary genetic information they already own).
The better question then, is not “will Ceres make money,” but, “will Ceres become the Monsanto of biofuel crops?”
There’s no question that Ceres faces large obstacles in getting their seeds to market. The big catch for farmers planting a perennial energy crop is that it takes two years to establish a productive stand. Unlike annual corn crops, which put down a relatively shallow root system, switchgrass grows down into the ground before it establishes the biomass needed for ethanol production. This is a very big deal for farmers, most of whom are technically bankrupt at the end of each growing season and can’t afford to wait two or three years to see a return on their investment.
There’s also no prior knowledge for growing a crop like switchgrass, which is one step removed from the wild, so Ceres will also have to be instrumental in helping farms make the transition.
Fortunately, there’s a little help in the form of the 2008 Farm Bill. The Farm Bill instituted the Biomass Crop Assistance Program (BCAP), which helps farmers transition to dedicated energy crops by covering large percentages of the transition cost. BCAP will also pay growers yearly until the biorefinery they supply can pay them, and puts in place a capped dollar matching program for harvest and transportation costs. Getting over the initial investment hump is also a big deal for ethanol production facilities too, and the BCAP allocates funds for up to 30% of the cost of developing demonstration-scale ethanol plants.
What is the potential of one of these energy crops, switchgrass?
The U.S. uses 390 million gallons of gasoline for motor vehicle transport per day. That’s a bit over 142 billion gallons of gasoline each year. Using a back of the envelop calculation, if we took just 5% of rangeland in the U.S. (30 million acres), and converted it to switchgrass production, assuming we could produce 100 gallons of fuel from every dry ton, that’s 30 billion gallons of fuel, or 21% of U.S. gasoline consumption.
And that’s assuming no advancement in the productivity of switchgrass, which is extremely unlikely (see the USDA switchgrass study for more).
Switchgrass is particularly well-suited for use as a fuel crop, since it’s:
- A native plant and high yielding.
- A perennial with strong net energy balance (more energy comes out than you put in).
- Currently produces up to 10 tons per acre (dry).
- Requires low inputs. Nitrogen (N) as low as 50 lbs per acre.
- Often, no phosphorous (P) or potassium (K) is required.
- Weeds aren’t a problem after stand establishment.
- During senescence, the plant puts nutrients back into the soil and roots sequester carbon.
- Disease or pest problems are not a major concern because it’s well adapted to US.
While it took centuries to turn corn into a staple of the American diet, Ceres hopes to condense the normal process of plant selection into just a few years, and facilitate the introduction of these plants into the marketplace.
The at-the-pump cost of cellulosic ethanol produced from dedicated energy crops will largely depend on the technology used by production facilities, and that’s where companies like Mascoma, Coskata, and BlueFire Ethanol come in. These three companies tend to quote about $1-1.50 per gallon for their final product.
This information comes from last week’s GM backgrounder on cellulosic ethanol feedstocks, which was a detailed look at some of the frontrunners in this arena. For more information, see the following posts.
Or, want to duke this out in the discussion forums?
“Do Biofuels Suck?”
More Posts on Switchgrass and Cellulosic Ethanol:
- Switchgrass Could Displace 30% of US Petroleum Usage With 94% GHG
- First Cellulosic Ethanol Plant Goes Online, Makes Fuel From Wood Waste
- GM Announces Biofuel Partnership with Coskata: Cheap, Green Ethanol
- GM Announces New Cellulosic Ethanol Partnership with Mascoma Corp
- Mascoma Update: Cellulosic Ethanol Company Adds $10 Million From Marathon Oil
- World’s First Commercially Viable Cellulosic Ethanol Plant Online 2009
- Cellulosic Ethanol Sugar Diverted to Algae Biodiesel Production
- Genetic Engineering for Cheaper Cellulosic Ethanol?
- Prototype Ford Escape Plug-in Hybrid: 88 MPG on 85% Ethanol
Photo Credit: Ceres, Inc.