Sweetwater Energy Inc., a closely held company that supplies systems that extract fermentable sugars from non-food plants, received $9 million to develop its technology for biofuel and biochemical refiners.
Chief Executive Officer Arunas Chesonis was among the 35 investors, including Riverhorse Investments Inc., Cranberry Capital and other “wealthy family offices,” Chief Financial Officer Keith Wilson said today by telephone. Funding will be used to design and build sugar processing facilities for initial customers, Sweetwater said today in a statement on its website.
“In 2013, we expect to have somewhere between two and four operational,” Wilson said. Each machine will process about 100 tons of biomass a day, using a combination of acids and enzymes to produce 24,000 tons of sugars annually, he said.
That amount would be enough to produce about 3.4 million gallons of ethanol a year, Wilson said. The facilities are modular and some customers may purchase many, or use the sugars to make biochemicals or bioplastics, he added.
“You can use it effectively as a replacement for petroleum,” he said.
Oil companies in the U.S. are mandated to blend 36 billion gallons (136 billion liters) of biofuel with their fuel products by 2022, including 16 billion gallons made from so-called non-food cellulosic feedstocks.
No commercial volumes of cellulosic biofuels are produced currently in the U.S., according to the U.S. Environmental Protection Agency. Conventional corn ethanol producers may incorporate Sweetwater’s systems to produce next-generation fuels at their plants, according to Wilson.
“We can be a component of the first generation ethanol folks, and we’re working with folks who are looking at moving into the second generation on a pure basis,” Wilson said.
The company, based in Rochester, New York, began operating a pilot facility in March and expects to start up a demonstration unit in the fourth quarter. Sweetwater in April announced a partnership with BioGasol ApS, a Danish biotechnology company, to incorporate its biomass pretreatment processes with Sweetwater’s systems.
“We will build the facility, we will manage the feedstock, and we will deliver to the end user the industrial sugars,” Wilson said. “The goal is to put them as close to the feedstock and the end user as possible,” he said.
The Series A financing follows Sweetwater’s $1.2 million seed funding round, which was provided primarily from Chesonis and President and Chief Operating Officer Jack Baron in February 2010, according to the statement.