It was the spring of 2008, and Dr. John Pierce was describing the “green” breakthrough technology developed by his team at DuPont to a reporter from the New York Times. Today that breakthrough, Bio-PDO, is just one of many “green chemicals” with lower environmental footprints than petroleum-based chemicals.
In fact, the bioeconomy is everywhere, in your refrigerator, your pantry, your living room, and your medicine chest. Simply put, the bioeconomy is commerce related to living things – all the products derived from plants, animals and microbes.
Food, forest products, and natural textiles like cotton and wool represent the material commodities of the traditional bioeconomy. Beer, wine, cheese, and naturopathic medicines can be considered early biotechnology components, leveraged by scientists to build the modern bioeconomy.
A growing market
The modern bioeconomy, largely based on advances in biotechnology, has two main goals: replacing fossil-fuel based fuels, chemicals and materials with products made from renewable biomass, and bringing new products with novel properties to the table.
These products run the gamut from bio-medicines (with low market volumes and high value) to fuels (with high market volumes and low value). In the first group, the market opportunities are limited by the creativity of the products’ uses (applications) and consumer choices related to performance and cost.
The traditional bioeconomy is still big business. In 2012 the U.N.’s Food and Agriculture Organization valued agricultural products at nearly four trillion US dollars. Forest products contribute an additional quarter of a trillion dollars to the global economy
Advances in biotechnology have improved medicines, crops, food, fuels, and chemicals, broadening the reach of the bioeconomy.
In 1983, at the beginning of the biotech revolution, the sale of biotechnology products including biofuels, food additives, enzymes, lubricants, detergents, and nutraceuticals (vitamins and dietary supplements) was only $13 billion.
By 2010, the value of biotechnology-derived products in the bioeconomy would exceed $500 billion, contributing roughly 2 percent of the GDP in the U.S. The global enzyme market alone was worth $3.3 billion. The biofuel market value had grown to $87 billion, and revenues for genetically modified crops approached $100 billion.
Meanwhile, the market for health-related bio-based products skyrocketed. The so-called “biologics” -- including therapies such as ZmAb, the monoclonal antibody recently used to cure two Ebola patients at Emory University --were valued at $149 billion in 2010; by 2015, the market for biologics is expected to near $239 billion. The global biobased nutraceutical market was $142 billion in 2011 and is expected to nearly double, hitting $205 billion by 2017.
The biotransformation of chemical manufacturing
Stunning advances in genomics and microbial metabolic engineering have allowed scientists to construct new, “greener” pathways to make specific chemicals and the tools to scale-up the production.
An iconic example is the development of bio-based propane-diol at DuPont, a chemical used to make synthetic polymers, cosmetics, adhesives, detergent, and antifreeze. It represents not only a pioneering technical feat, but a change in thinking among the corporate giants of industrial chemistry.
In both his former role as Vice-President for Technology at DuPont and his current role as Chief Bioscientist at BP, Dr. John Pierce has helped steward bio-based initiatives, including efforts to develop bioplastics and cellulosic ethanol.
“If the end-goal is to add technical innovation to marketplaces – which you can do with modern biotechnology – you need two things: Some freedom around the basic science of discovery, and the ability to find or create market opportunities for what you find,” he says. “Those efforts need vision, talent, luck, and a fairly long-term commitment to the endeavor.”
According to Pierce, the bio-based program in DuPont -- now a flagship of the company -- was really the product of such freedom and market opportunities, combined with a long-term basic science tradition. “You really can think of DuPont as a market-driven science company,” says Pierce.
Pierce joined DuPont in the early-1980s, when the program for bioproducts was concentrated mainly on exploring applications to agriculture and medicine. The company was already shifting towards more environmentally sustainable practices. There was even a small effort to develop bio-derived monomers and polymers, including poly-lactic acid (PLA), a biodegradable plastic made from sugar discovered at DuPont in 1932.
It was early days It was early days for modern bio-based chemicals and achieving the performance of modern bio-based chemicals was challenging. Despite its environmental benefits, PLA had inferior strength, flexibility, and melt stability compared to petroleum-based plastics. Several companies explored producing the polymer but only Cargill moved forward, entertaining a short-lived joint venture with Dow Chemical Company from 2000 to 2005. DuPont would come back to PLA in 2006 when its researchers dusted off Biomax Strong, an additive to improve PLA performance. Also that year, DuPont’s joint venture with Tate & Lyle would began commercial production of bio-1,3-propanediol (Bio-PDO).
The molecule, made in a modified bacterium, could be used directly in products from cosmetics to de-icers and could substitute for a petroleum-based pathway to make Sorona™, a linear aromatic polyester used in textiles from spandex to carpet. According to the company, the bio-process required 40 percent less energy (the equivalent of 10 million gallons of gasoline each year) while reducing costs and greenhouse gas emissions – a win-win for economics and environmental stewardship.
“You can’t just have a cool discovery,” says Pierce. “You need to be able to monetize your research investment. Sometimes that just takes getting the creative juices flowing and fostering some sideways thinking. Modern biotechnology has really changed the equation. The engineers toss up a potential process and the biologists, can now say, ‘Hey, we can do that.”
Of course, getting a bioprocess to work economically at commercial scale isn’t necessarily easy. Bio-PDO took years of innovation and technology development.
“When we started in the mid-90’s, there was just a lot about microbial metabolism we didn’t know. By today’s standards, our tools were still pretty crude,” says Pierce. By 2003, after hundreds of mutations and the convergence of several independent work streams, the team had developed a strain of E. coli fit for commercial production. “The learning during that time period was really amazing, he recalls.”
Other biobased chemicals would follow. By 2010 bio-based chemicals would constitute an estimated 5-10 percent of total global chemical sales. In spring of 2011, DuPont Tate & Lyle BioProducts signed a partnership agreement with Genomatica to demonstrate fermentation of sugars from corn milling to 1,4-butanediol (BDO), a sustainable precursor chemical with a $4 billion dollar market potential for use in plastics, elastic fibers, and solvents. Building on the learning and infrastructure from bio-PDO, the BDO process was at commercial scale by February 2013, only five years later.
That same year, BASF, who was also pursuing bio-BDO, announced the fruits of a long-term investment in producing bio-acrylate in partnership with Cargill and Novozymes. Rather than using a petroleum-based process, their route would involve fermentation with an engineered microbe to make 3-hydroxyproprionic acid which can then be dehydrated to form acrylic acid. The prize: a piece of the $10 billion dollar acrylate market, consisting of diapers, coatings, adhesives, textiles, and detergents, and populated with companies like Kimberly-Clark, Unilever, Glidden, Sherwin-Williams and Valspar, all looking to use greener materials in their products.
The question of the green premium
By 2013, bio-acrylate would be one of nearly 900 individual products registered with the USDA bio-preferred program.
Which raises a big question: Are people willing to pay more for renewables?
The quick answer is yes -- but not much. There certainly are consumers that prefer products from renewable sources. A survey of consumers in the U.S. and the E.U. found that nearly 80 percent were willing to pay an additional 5 percent for renewable content. But fewer than 10 percent of consumers would pay a 25 percent “green premium.”
Even so, companies may have other motivations, including leveraging sustainability goals to boost their corporate image and build brand loyalty.
Take Coca-Cola as an example. In 2010, after years of criticism for using unsustainable plastics for bottled water, the company’s Dasani brand got a new “Plant Bottle”. In 2013 Coca-Cola partnered with Ford Motor Company to use the PlantBottle Technology™ as material for upholstery fabric on seat cushions, seat backs, head restraints, door panel inserts and headliners in the Ford Fusion Energi. The effort was enough to win the 2014 Sustainable Bio Award Industry Champion of the Year, an accomplishment Henry Ford himself would have loved to see.
Ford was an early champion of the bioeconomy. Along with Thomas Edison and George Washington Carver, Ford was a supporter of the early “chemurgy” movement dedicated to expanding the use of agricultural products for materials, chemicals and fuels. Besides running his model T on ethanol in the U.S. and Brazil, Ford wore suits made of soybean polyester. In 1941, Ford and Carver unveiled a prototype of the world’s first car made from “agricultural plastic”. Unfortunately, the car fell victim to challenging economics and disruption in car manufacturing during World War II.
Fueling the bioeconomy
Ford’s vision for the bioeconomy means that bio-based alternatives for both chemicals and fuels must be at scale. So, can the revolution in commodity chemicals extend to the lower margin fuel market?
According to Kes McCormick of Lund University’s International Institute for Industrial Environmental Economics in Sweden, transportation biofuels are “the most visible output of the bioeconomy at present.” He further suggests that the mix of bio-products from biorefineries is “expected to underpin the shift towards an advanced bioeconomy”.
This is certainly true in the policy realm. Several countries including the United States, Finland, Sweden, Germany, and India have national bioeconomy strategies or roadmaps. Others, such as Canada, have adopted more regional approaches to growing the bioeconomy. All have significantly large contributions by bioenergy.
Pricing carbon emissions and thus creating markets for carbon offsets – as British Columbia, California, and others are trying to do – will further expand the value of the bioeconomy. Green energy is already partially monetized through feed-in tariffs in some countries and regions. If favorable government policies remain in place, standards, mandates, and markets for renewable fuel credits will also stabilize investment in cellulosic and advanced biofuel technologies.
Heat and power from biomass, an often overlooked sector of the bioeconomy, is the largest currently used source of renewable energy next to hydropower. Electricity from wood, municipal waste and even biogas from manure can power homes, industry and the electric vehicle fleet.
Because the margins for fuel are so slim, co-producing bio-products is one way to spur biofuel development. For example, the Beta-Renewables cellulosic ethanol plant in Crescentino, Italy produces biomethane and bioelectricity, which both earn renewable energy credits. This “residual energy” can be substantial. In 2012, sugarcane mills provided 15.4 percent of Brazil’s total energy in 2012 from bagasse, the dried stalks leftover from juicing the cane. In the U.S., the corn ethanol industry provides high-protein animal feed in the form of distillers grains to the pork, poultry, dairy and cattle industries.
While many algae companies include the possibility of supplying feed for aquaculture as part of their economic equations, Solazyme, a company producing oils from sugars with microalgae, has embraced the high-value cosmetic and personal care market.
Originally funded by the Department of Energy and venture capital to produce advanced algal biodiesel, the company has been raising cash with alternative bio-products made from algal oil.
Other companies would like to do the same, but navigating the price points of low-volume markets can be tricky. High-value markets such as personal care, nutraceuticals, and fine chemicals are relatively small. Flooding a market with co-product can substantially lower the price -- and the profit.
That’s exactly what happened in 2006 with the “glycerin glut.” Glycerin, used in soaps, epoxy resins and other materials, is a byproduct of conventional biodiesel production.
Increased global production of biodiesel sent a lot of glycerin into the market – about 10 pounds for every 100 pounds of fuel – resulting in a drop in glycerin price from 25 cents a pound to 5 cents. But importantly for the bio-economy, the new low-cost feedstock spurred new research efforts to use glycerin for higher value bio-based chemicals.
While many early products of the modern bio-economy are derived from feed crops, researchers have renewed their focus on technologies to expand use of lignocellulosic biomass, or biomass from parts of plants indigestible to humans. Overall, the synergies between biofuels and other bio-based chemicals are extremely strong. Using biotechnology to replace the ‘whole barrel’ by providing fuels and chemicals from biomass, including lignocellulose, is crucial to reaching long-term sustainability and breaking the dependency on fossil fuels.
“The move to the bioeconomy and away from fossil fuels is inevitable,” says Dr. David Zilberman, a professor of agriculture and resource economics at UC Berkeley and principal investigator at the Energy Biosciences Institute. “The modern era brought us technologies that improved the human condition, but many are not sustainable. The addiction to non-renewable resources cannot last forever. Sooner or later we need to move to a renewable economy, and the bioeconomy is driving that.”