Thursday, September 29, 2011

Australias backyard teaming on Algae Biotechnology-Algae Biofuels!

Companies, operating in Outback Australia, personify promise and hardiness in the microalgae corner of industrial biotech
The birth, life and death of a global micro-algae industry has been written so many times that it must seem to many readers like a microscopic version of Buddhist reincarnation, the lifecycle of the phoenix, or out-takes from the motion picture Groundhog Day.
It has all the elements of classic literature. Promising strains plucked from obscurity by sometimes mysterious benefactors, like the stories of Oliver Twist or Pip; tales of prodigal powers of growth, presumed fortune and mis-spent youth, out of the chronicles of young Prince Hal and Falstaff; and lost opportunity and regret straight out of Sentimental Education.
Gumption and Darwinian times
But out of all literature, it is the qualities that Margaret Mitchell essayed in Gone With the Wind that most closely apply to the entrepreneurs, renowned investors, gold-diggers, celebrated scientists, quacks, loyal supporters and camp followers who have tackled the development of micro-algae, plankton and cyanobacteria as an alternative to fossil oil and gas. We live not in Dickensian times, but in Darwinian days.
“What qualities are in those who fight their way through triumphantly that are lacking in those who go under?” Mitchell wrote. “I only know that the survivors used to call that quality ‘gumption.’ So I wrote about the people who had gumption and the people who didn’t.”
Of the approximately one zillion people, companies, science-based organizations, governments, or lunatics out for an airing that have taken up the development of micro-algae, the survivors share one thing in common with the microcellular strains they have found or enhanced – and that is a remarkable level of gumption indeed. They live in Darwinian conditions indeed.
Three ventures, with operations located in Australia, personify those qualities of gumption as well as any three in the world: MBD Energy, Muradel and Aurora Algae.
For sure, there are numerous other ventures utilizing micro-algae as a platform technology or as the end product – Martek, Aquatic Energy, Solazyme, Aquaflow Bionomic, Phycal, Cellana, Sapphire Energy, Solazyme, Solix, and AlgaeTec just to name an impressive few out of the many that have been profiled over the years in Biofuels Digest. Not to mention an array of research institutions and consortia working on DOE, DARPA or other governmental and private research projects.
Out in the Never-Never
But there’s something so highly appealing about these three companies, operating in the “Never-Never” of outback Australia. They have as hardy a tale of survival in the wilderness as the celebrated novel We of the Never-Never, that in 1908 first popularized the “survival against the odds” genre of outback Australia tale-telling.
Where are they? MBD, developing in South-Eastern Queensland in the shadow of the coal-fired Tarong Power Station about 200 kilometers northwest of Brisbane; and two, Muradel and Aurora, along the forbidding northwest Australian coastline at Karratha, in Western Australia.
Australia’s prized economic success stories, its massive coal and iron mining industries, are the source of the CO2 for all three ventures, though Aurora Algae and Muradel are working with open-pond systems, while MBD is working with carbon capture strategy to grab CO2 from power station flue gas. Flat, open land and plenty of sunshine – well, Australia is long-renowned for having plenty of both.
The water? In the case of the closed systems of MBD, the water source is less critical in nature, but in any case Queensland is the wettest state in the country, and as well known for its floods as other parts of the country are known for searing drought. In the case of Muradel and Aurora Algae, they are focused on saline algae, and have the (essentially unlimited) source of the Indian Ocean near to hand.
Muradel is remarkable, in a world fitfully awash in cash-laden algal research operations, for having constructed their first micro-pilot on a budget of $2,000, cobbled together out of the resources of the University of Adelaide and Mudroch University (hence, “Muradel”). $3.3 million in funding subsequently arrived for a full-scale pilot, which was constructed up in Karratha, and Muradel Pty Ltd was incorporated in December 2010 as a joint venture between Murdoch University, Adelaide Research, Innovation Pty Ltd and SQC. The company is now going through the process of raising cash for a demonstration of its technology.
“We have achieved production rates of 50 tonnes per hectare per year,” Project Leader Professor Michael Borowitzka from Murdoch University told the Adelaidean last year, “over half of which is converted to oil. These high production rates are expected to increase at the new pilot plant due to the even better climatic conditions in Karratha.” Head engineer David Lewis, of the University of Adelaide, confirmed at the Alternative Fuels Summit that the project’s pilot is fully operational and meeting project goals. Last year, Muradel indicated that it had brought biofuels production costs to under $4 per kilo.
Aurora Algae
Aurora Algae recently completed the raising of another $22 million, bringing its total fund raise to $72 million so far. The company has moved away from being a biofuels pure play to focusing on nutraceuticals. The newest funding round will go towards the building of its first commercial scale plant in Australia.
Aurora Algae announced that it has awarded the initial engineering contract for design and construction for the Company’s commercial facility in Maitland, Western Australia.
Recently, the company announced an option agreement on over 1,500 acres of land located near its demonstration facility in Karratha. With the award of the initial engineering contract, Aurora Algae is one step closer to constructing a full-scale commercial facility equipped to manufacture thousands of tonnes of algae-based biomass annually.
The Aurora process is expected to produce 15 tonnes of biomass per month in the demonstration plant from 6 one-acre ponds, suggesting that volumes could increase to 37,500 tonnes of algal biomass per month at a maxed-out commercial facility. At 25 percent oil content, that could provide up to 33 million gallons of algal oil in addition protein and feed biomass. By contrast, 15,000 acres of soybeans would generally provide less than 1 million gallons of vegetable oil.
MBD Energy
Last year, the Queensland state government announced a $1 million investment for a trial which uses algae to soak up carbon emissions from a coal fire power station. Premier Anna Bligh said Tarong Power Station near Kingaroy will be the first coal-fired power station in Australia to try the technology as part of the $5 million MBD Energy Limited Tarong trial.
Ms Bligh said that as part of the trial MBD Energy would start construction on a one hectare algal biomass display plant beside Tarong Power Station, 180km north-west of Brisbane, in December.
Premier Bligh said MBD Energy had also agreed to build facilities next to power stations in Victoria (Loy Yang A) and New South Wales (Eraring Energy), with construction underway first at Tarong.
The Tarong Power Station test plant, once fully built, is expected to capture about 700 tonnes per annum of CO2, produce one tonne of algal biomass per day, 120 tonnes per annum of algal oil and 240 tonnes per annum of algal meal by 2012. Ultimately, MBD expects to expand the facility to 80 hectares by 2013, producing 3 Mgy of algal based fuel and up to 25,000 tons of algal meal.
The closely-watched algal technology developer OriginOil is a strategic partner and supplier to the MBD Project. OriginOil announced in January that it received its first commercial order to deploy its algae oil extraction system in an industrial setting. MBD Energy (MBD) recently committed to purchase an initial OriginOil extraction unit for piloting at one of Australia’s three largest coal-fired power plants. MBD Energy expects OriginOil technology to support a pilot Bio-CCS (Bio-based Carbon Capture and Storage) algal synthesizer system at Queensland’s Tarong Power Station.
Separation technologies, bioreactors and more: special microalgae features
Investing in Innovation, and betting against it
The progress of these three companies, out in the Never-Never, not to mention the persistent innovation n the space represented by the technical artucles we are publishing today, brings us to the “never, never”so often uttered by investors, declining participation in the latest algal project submissions from developers around the world.
Is “No” a safe answer? Isn’t “No” a bet on the future of technology, just as much as check invested in a venture is a bet. – only is is a bet against algae as a fuels, chemicals, feed, nutraceuticals or food platform.
It is a bet against gumption itself and, as we have seen in the case of Solazyme (where the Seties B investors – the $8 million round that is not unlike Muradel’s needs, in scope, bought in for $1.01 per share, for a stock selling for $14 today), there is a lot more non-buyers remorse going around than buyer’s remorse.

Thursday, September 22, 2011

Do we need the RSPO?

Do we need the RSPO?

Oil palm growers may have done the wrong thing when they let the Roundtable on Sustainable Palm Oil decide what kind of palm oil is sustainable
IN April 2008, Unilever, one of the world's single largest consumers of vegetable oil, came under attack. Its UK offices came under siege from orang utans, or rather Greenpeace activists dressed as those adorable, cuddly creatures.
Eight of them managed to climb on to a balcony at one of the Unilever buildings and their antics in orange furry suits and monkey masks to make them resemble those “people of the forest” got coverage around the world. A great gimmick.
Greenpeace's beef, which is not entirely correct: Forests, the orang utan's habitat, are being cleared in Borneo to be replanted with oil palm and that Unilever is a large purchaser of the resultant palm oil.
Basically the non-governmental organisation or NGO was lobbying consumers to boycott a range of consumer products from Unilever and indirectly putting pressure on all palm oil growers worldwide by asking whether they produce “sustainable” palm oil or not.
The Roundtable on Sustainable Palm Oil or RSPO was formed in 2004 out of similar pressure over years. Basically it is a grouping of oil palm growers, users and interested parties which has now agreed on certification as to what constitutes sustainable palm oil.
That's a long list but at the top of that is one condition that palm oil should not be produced from the clearing of forests. Others include social criteria such as treating employees well, not displacing indigenous people etc.
Malaysia has officially stopped clearing virgin forests and apparently that has resulted in Malaysian producers considering themselves as having an advantage relative to Indonesian producers. Hence, some of them believed they could get a competitive advantage over Indonesian producers if they go the RSPO way and get their palm oil certified as sustainable.
But they may have shot themselves in the foot. Increasingly, they may be finding that some of the conditions imposed are onerous and difficult in terms of implementation and that the RSPO is being controlled by other interests and they have little say in what it does.
For instance, how does one ensure that all production going into a mill or a refinery is from certified sources and can one get enough input even then? If supply is “contaminated” with a bit of uncertified oil palm or palm oil, does the entire batch become uncertified?
And who are these people who certify the oil?
That oil palm growers have allowed themselves to be pressured and seduced to believe that RSPO-certified palm oil is the key to their survival may turn out to be one of their bigger mistakes in life, something they may have cause to regret unless they do something about it.
The RSPO is comprised of a whole lot of members other than growers. The growers do not exert significant influence over the body and have instead relinquished this to a body of people who may not be that independent, especially in terms of their stance towards deforestation and issues affecting oil palm growers.
According to the RSPO website, Malaysia has 95 members and Indonesia 79 out of 495 members. That's 37% in total but European members total 280, accounting for 57%.
Indonesia and Malaysia produce some nine tenths of the world's palm oil but their members in the RSPO total less than half that.
Or take composition by category. Oil palm growers have just 87 members, a mere 18% but palm oil processors and traders have 191 members or 39% while consumer goods manufacturers and retailers have 186 members or 38%. Again, growers are swamped.
Perhaps there are executive board provisions for growers, but no. It looks bad, real bad. They have four allocations, the same as for NGOs, with two for environmental ones and two for social ones. Palm oil processors, consumer goods manufacturers, retailers, and bankers and investors have two each, again swamping growers.
That means oil palm growers are overwhelmed three to one by others on the executive board. The current secretary general in fact was a representative of WWF International on the executive board from 2007 to 2009. Can growers expect their interests to be well-represented under such circumstances? No, not at all.
How growers have allowed themselves to be so weakly represented on the RSPO to the extent that they have much less say than others is impossible to understand. At the least, they should have had an equal representation it's their product which is being certified.
A look at two videos on the RSPO website indicate the bias towards deforestation and the obsession with orang utans, the primary marketing tool of NGOs in their fight against use of palm oil in developed countries.
One is by the WWF, an organisation which routinely raises funds by alleging that many animals, including the orang utan, are near extinction. Predictably, the orang utan is again showcased in this video and the message is forests cannot be cleared. Many Malaysians will challenge the view that orang utans are an endangered species in Malaysia.
How forest resources are used is a sovereign right and others are entitled to object if the clearing is done in an improper manner. The RSPO cannot be the final arbiter of how the forests should be used which needs to balance the development needs of the country and the need to maintain eco biodiversity. Even RSPO's own video rolls out the orang utan yet again although the message is not so strident in terms of forest clearing and makes some admission of oil palm's advantages over other crops.
Growers have one thing going for them and it may be more important than any other economics. The demand for vegetable oil is skyrocketing from year to year as demand from China and India and other developing countries increases rapidly. Certification won't matter in scarcity.
Palm oil growers have put themselves in a tough spot but it is quite easy to get out of it. Malaysia and Indonesia produce nine tenths of the world's palm oil. If both these countries don't participate in RSPO there is no RSPO. Period.
Managing editor P Gunasegaram wonders why there can't be roundtables on sustainable production for a whole lot of other goods and services such as laptops, notebooks and tablets, cars, trucks, trains and planes, Hollywood movies, TV serials and singing stars, subprime mortgages, Wall Street bonuses and derivatives the list can go on and on

Tuesday, September 13, 2011

Breaking news: Australia's $23/ton carbon pollution tax announced!

The Australian Prime Minister Julia Gillard and woken up mightily to tax the polluters and pay the forest keepers allowances.

Ms Gillard said the Parliament had been debating climate change for decades and most Australians now agreed the world was warming.
That was caused by carbon pollution, she said, and the best way to make the polluters pay was to put a price on carbon.
"Today we move from words to deeds," the Prime Minister told Parliament today.
The package of bills will establish a fixed $23-a-tonne price on carbon pollution from mid-2012.
An emissions trading scheme with a floating price will begin three years later.
There will be compensation for most households and big business to help them adjust.
A separate piece of legislation will support steel workers through a $300 million transformation plan.
The Government today will also refer its carbon price legislation to a joint parliamentary inquiry which is scheduled to report back by early October.
Labor expects both houses to have passed the bills by mid-November.
The Government received more than 300 submissions on its draft legislation.
"I firmly believe that no stone remains unturned, no voice unheard, so this is the plan for Australia's carbon price," Ms Gillard said.
The Government had taken "a modern policy approach with efficient allocation and incentive to innovate".
It will start with a fixed price then move to "a well-designed market".
Other features include assistance for emissions-intensive trade exposed industries, abatement at lowest economic costs and links to international markets.
The Prime Minister said this was "all adding up to a new bottom line where polluters pay".
Ms Gillard said about 500 polluters would pay carbon tax.
Those included entities that emitted 25,000 tonnes or more of carbon pollution a year and large users of natural gas.
Ms Gillard said natural gas suppliers, such as retailers, would pay a carbon price on emissions that arose from the use of natural gas by smaller customers.
"Around 500 entities will have mandatory liability under the carbon pricing mechanism - around 500 polluters will pay," she said.
Ms Gillard said the fixed price, set out in legislation, provided business with certainty and allowed for a manageable transition to carbon pricing.
After three years the scheme automatically moves to a fully flexible cap and trade emissions trading scheme.
"From this time on, a cap will be placed on national emissions and the carbon price will be determined by the market," she said.
Ms Gillard said in the first three years of the floating price period there would be a price cap and a price floor to limit market volatility and reduce risk for business as they gain experience of the new regime.
The Prime Minister reiterated that Australia aimed to reduce emissions by five per cent on 2000 levels by 2020 and 80 per cent by 2050.
"Achieving this target will take more than 17 billion tonnes of carbon pollution out of the atmosphere between now and 2050," Ms Gillard said.
That will mean in four decades' time nine out of 10 tonnes of pollution that would otherwise have been spewed into the atmosphere won't be produced.
Ms Gillard said Australia's carbon price regime would be linked to international schemes so businesses could more cheaply offset their liabilities overseas.
But they'll be limited to using offshore credits for half their obligation.
Ms Gillard said to determine liability under the carbon price mechanism, information would be drawn from the national greenhouse and energy reporting system.
The greenhouse gas pollution measurement system was developed under the Howard government, and started in September 2007.
The carbon pricing mechanism would not apply to agricultural emissions, legacy emissions from landfill facilities and emissions from landfill facilities that close before July 1, 2011.
The legislation recognised the different ways businesses structured their affairs, and deals specifically with joint ventures that were a common feature of resources and energy projects .
It also allowed businesses to transfer liability under the mechanism within their corporate group.
Ms Gillard said the Government would seek to close around 2000 megawatts of highly-polluting generating capacity by 2020.
"Closing down some of our high pollution coal-fired capacity makes room for investment in low-pollution plant and starts the transformation of our energy sector in a responsible way," she said.
The carbon pricing arrangements would be supported by robust and independent governance arrangements.
The Clean Energy Bill 2011 set out the core provisions, architecture and review arrangements.
Consequential amendments will be made to a range of other laws dealing with climate change, economic regulation and taxation.
Ms Gillard said 40 per cent of the revenue raised by the climate price would be used to support emissions-intensive, trade-exposed industries.
The Productivity Commission will regularly review a jobs and competitiveness program.
"(This) will ensure that our industries are in the best position possible to manage a smooth transition to a clean energy future," Ms Gillard said.
The Government will also support energy suppliers to maintain supply during their transition to clean energy.
Ms Gillard said the price impact of the carbon tax would be modest on families but she understood family budgets were tight.
As a result, most of the money raised from the carbon tax would be used to fund tax cuts, pension increases and higher family payments.
"Every older Australian who relies solely on the pension will be among the four million Australian households who get a buffer for the budget, with the extra payments being 20 per cent higher than their average extra costs," she said.
Tax reform was also on the agenda, with the tax-free threshold tripled.
Ms Gillard said 450,000 people - earning between $16,000 and $20,500 a year - would pay no tax at all.
"A tax reform which rewards work - which builds on our budget changes to lift workforce participation and spread the benefits and dignity of work to every Australian," she said.
Ms Gillard threw down the gauntlet to the Opposition, saying the coalition would be judged by history if it voted against the legislation.
"There is a reason these matters are decided in an open vote," she said.
"It is so every member in this place can be judged.
"Judged on the decisions they make here, judged on where they stand on the great issues of our national debate."
Ms Gillard said politicians would be judged by Australians now and in the future.
The final test was not whether you were on the right side of the short-term politics or polls.
"The final test is this: are you on the right side of history?
"And in my experience the judgment of history has a way of speaking sooner than we expect."
The prime minister finished by harking back to the "It's time" election campaign of former Labor great Gough Whitlam.
"It's time to deliver the action on climate change we need," she said.
"To do what is best for Australian families, what is best for future generations, what is best for this country.
"I know we can get there."

Wednesday, September 7, 2011

Giving the forest stewards rewards-KEEPING THE FOREST-REDD+ way forward!

The Copenhagen climate change conference had shaped up on the potential REDD+ clarifications and its working mechanism. A binding final agreement was not achieved due to lack of international consensus. The two most important obstructions that stand in the way were reduction targets and financing. A successful REDD+ will depend on successful conclusions on these two issues. Such successful conclusions need good REDD+ programs and devoted international support. REDD can move but without these important support/promotion, a true conclusion is sluggish.
However, negotiators have reached some consensus on some vital key points, these issues are likely going to be part of the REDD agreements reached. The negotiators at the-fifteen conference of the parties ( COP15) meeting used the REDD+ scope instead of REDD so to cover forest operations that that do more good as well as those that do less good. However, conservation should be limited to and excludes food plantation such as oil palm,coffee,tea, reference to UN declaration of right to the indigenous people(UNDRIP) and finally must have full participation of the local people in the planning/implementation and projects benefits.
The following keys have yet to be discussed are such as REDD+ financing and benefit sharing mechanism, its methodologies for the monitoring ,reporting and verification, scale and strategy for implementation.
On the 10th December 2010, Cancun, Mexico was the UN climate Change Conference, it was here that 194 delegates from every country meet to make progress towards the change for the better to improve mitigation and adaptation to climate change, although the bindings are not much stronger, the hopes are higher that the delegates have at least come to meaningful negotiations on important decisions- and so have had achieved something the forest stewards can be enhanced to protect wild life for next couple of decades or even further sustaining the climate change at large.
Since that countries worldwide have in one way or the other gathered together policy makers, scientist, NGOs, private and even large media-wide campaign and awareness on climate change. Policy makers winding up control ,monitoring guidelines, experts draw up technical assistance and governments even making known new taxes-Carbon tax. These are development to fine tune for mass conservation programs worldwide- which will come one day and is mandatory!
In summary, the world has taken so much from the environment without giving anything in return ever since beginning of civilization or industrial revolution. The writer believes that protecting the wild life, conserving and preserving even if it costly is worthy. REDD+ is a way forward, villagers and forest owners direly wait to see quicker developments on REDD/REDD+.