Algenol Biofuels

COMMERCIAL ADVANTAGE

We Grow the World’s Cheapest Energy TM

DIRECT TO ETHANOL® technology is globally competitive with any other biofuel processes. Ethanol produced with our technology competes with oil at $50 per barrel.

LOW PRODUCTION COSTS

The low-cost, low-carbon-footprint DIRECT TO ETHANOL® process can produce ethanol with operating cost of less than $1.00 per gallon. This operating cost assumes the purchase of carbon dioxide feedstock for $35 per metric tonne. As the DIRECT TO ETHANOL® process yields nearly 4 units of energy for every unit of energy input, the energy costs for the process are modest.

Capital costs to construct a DIRECT TO ETHANOL® facility will range between $4.00 and $6.00 per annual gallon of capacity. These costs will depend on specific locations and the productivity of our enhanced algae strain. We are targeting a productivity of 6,000 gallons of ethanol per acre-year, much more than that for corn (400 gallons per acre-year) and that for sugar cane (800 gallons per acre-year). We are working to increase the productivity of our enhanced algae above 6,000 gallons per acre-year, a potentially huge economic benefit.

The costs to produce ethanol from corn are driven by grain prices. When volatile corn prices were recently at $7 per bushel, the cost of the corn contained within a gallon of ethanol was approximately $2.50. While the co-product value from distiller’s dry grains (DDG) and corn oil will mitigate these costs somewhat, costs for energy and labor are incurred as well.

Ethanol production from sugar cane also depends on the supply of low-cost raw material. With rising demand for sugar as food, the cost of this raw material is increasing. A sugar cane ethanol producer can be competitive if it can purchase sugar cane for $20 per metric tonne and can sell electric power as a co-product. The recent importation of US-based corn ethanol into Brazil is a reflection of much higher world sugar prices.

Production costs of ethanol from cellulosic feedstocks or biodiesel from more conventional algae-based processes similarly are highly dependent on how efficiently these processes use raw materials and what value can be realized for co-products. Both cellulosic and algal biodiesel production capacity require high capital expenditures. Unlike the DIRECT TO ETHANOL® process, algae-based biodiesel processes require energy-intensive harvesting and dewatering of algae and extraction and treatment of the biofuel product.

The following chart summarizes Algenol’s view of the production costs of some selected biofuel technologies.

 

MODULAR SYSTEMS

Production costs can be further reduced with increasing scale of a DIRECT TO ETHANOL® project. Algenol’s technology translates well into a modular system, which provides greater scalability. A DIRECT TO ETHANOL® project benefits greatly from this scalability, which enables competitive ethanol production at energy industry scale anywhere in the world with suitable quantities of carbon dioxide, sunlight and non-arable land.

NATURAL RESOURCE CONSUMPTION

A DIRECT TO ETHANOL® project can consume hundreds of thousands of tonnes of industrial CO2 a year. In fact, CO2 is the largest raw material for a project, and the potential for a carbon tax or carbon credit in specific markets would further reduce the production costs.

The DIRECT TO ETHANOL® production process does not use food crop (e.g., corn or sugar cane) as a feedstock, farmland or other arable land, nor is fresh water required for production. Other fuel production processes use large amounts of fresh water resources:

  • gasoline: 2-2.5 gallons of fresh water consumed per gallon of gasoline produced;
  • cellulosic ethanol: 2-6 gallons of fresh water consumed per gallon ofethanol produced;
  • corn-based ethanol (excluding irrigation), 2-4 gallons of fresh waterconsumed per gallon of ethanol produced;
  • corn-based ethanol (including irrigation where used), 5-17 gallons of fresh water consumed per gallon of ethanol produced.

Algenol’s DIRECT TO ETHANOL® production process can be designed to provide fresh water.