Novozymes Additive Pushes Biofuel Closer to $2 Per Gallon

Novozymes A/S, the world’s biggest maker of enzymes for biofuels, has produced an additive that may lower the price of producing ethanol from natural waste products, a company vice president said.

The enzyme, Cellic CTec3, is more concentrated than its predecessor and will save biomass-ethanol makers 5 to 10 percent in total production costs, Poul Reuben Andersen, vice president for bioenergy at the Bagsvaerd, Denmark-based company, said in an interview yesterday.

“You now get more horsepower per enzyme, which for the companies will lower cost per use,” Andersen said at Bloomberg’s headquarters in New York.

A U.S. law signed in 2007 mandates the nation use 36 billion gallons of renewable fuels by 2022, with 16 billion being cellulosic ethanol. Ethanol produced from biomass may eventually supplant as much as 25 percent of the gasoline currently consumed in the U.S., Andersen said. “We envision further improvements still can be made.”

The enzymes are added to the pulp of wheat straw, corn stalks, switchgrass and household waste to form sugar and ferment into fuel and chemicals.

Fiberight LLC, which on Jan. 20 was conditionally approved by the U.S. Department of Agriculture for a $25 million loan guarantee for a cellulosic-ethanol plant in Iowa, will open a plant later this year in Lawrenceville, Virginia, that will use CTec3 enzymes to produce about 6 million gallons annually.

The U.S. consumed 12.6 billion gallons of ethanol last year, compared with 5 billion gallons in Brazil, 2.7 billion in the European Union and 590 million gallons in China, according to Bloomberg New Energy Finance.

Denatured ethanol for March delivery fell 1.4 percent to $2.184 a gallon yesterday on the Chicago Board of Trade.