| RESEARCH |
Novozymes and NREL report further progress in biomass-to-ethanol project 26. April 2004 Combining technology developed by the National Renewable Energy Laboratory (NREL) and Novozymes, the enzyme costs of converting cellulosic biomass into sugars for fuel ethanol production have now been reduced approximately twenty-fold. Furthermore, Novozymes has been granted a one-year extension of its collaborative subcontract with NREL and will receive USD 2.3 million in research funding. In January 2001, using funding from the US Department of Energy (DOE), NREL and Novozymes entered into a USD 14.8 million three-year collaborative research subcontract. During the course of the contract, Novozymes applied its proprietary biotech research platform to increase enzyme activity and fermentation yield, and to reduce production costs for enzymes used to convert cellulosic biomass into sugars for production of fuel ethanol and other valuable products. Fuel ethanol is currently produced based on enzyme-driven conversion of corn starch and other agricultural products, whereas production based on cellulosic biomass such as corn leaves and stalks has the potential to augment the feedstocks in existing industry and become the technology of the future for fuel ethanol production. In February 2004, Novozymes reported a twelve-fold enzyme cost reduction exceeding the ten-fold goal. Based on the latest achievements of NREL in the pre-treatment of cellulosic biomass materials and combining the improved treatment process with the advances already made in enzyme technology by Novozymes, the two partners have been able to reduce the costs of the enzyme part of the biomass-to-ethanol conversion from above 5 US dollars to below 30 US cents per gallon of ethanol. Douglas Kaempf, Program Manager for the Office of Biomass Program at the US Department of Energy, stated, "Combining Novozymes' advances in enzyme technology with the advances made by NREL in the pre-treatment of corn stover, we have gained important synergies between performance and costs. This achievement was possible through the strong partnership between Novozymes and DOE. The Department looks forward to continued reduction in enzyme costs obtainable from the extended support of this research team." To continue the significant advances already made, Novozymes has thus been granted a one-year extension to its three-year subcontract with NREL and receives USD 2.3 million over a year. The aim of the extension is to ensure a further cost reduction to a level of approximately 10 US cents per gallon of ethanol for the enzyme part of the biomass-to-ethanol conversion. If this goal is achieved, the new process is getting closer to becoming commercially competitive with current starch-based fuel ethanol production. Glenn Nedwin, President of Novozymes in Davis, California, where the majority of the research has been carried out, was very pleased with the recent achievements: "This is yet another step towards a more economically-viable biomass utilization process and further highlights the potential of industrial biotechnology. Although there is still some way to go before the fuel ethanol industry starts applying this new technology, it proves the quality of Novozymes' unique biotechnology capabilities and shows our commitment to ensure long-term business growth". Novozymes already provides various enzymes for producers of corn-based fuel ethanol and commands a significant market share. In 2003, US production of fuel ethanol increased by approximately 30%, among other things due to the extensive displacement of the non-biodegradable octane booster MTBE in gasoline. Financial implications The extension of the research subcontract and the subsequent USD 2.3 million research funding will have a slightly positive impact on operating profit for 2004 compared to the financial guidance provided in the annual financial statement of 29 January 2004. |
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