Making diesel from bacteria and sugar cane

Silicon Valley startup LS9 hopes to sell diesel made from bacteria and sugar cane commercially next year.

A Silicon Valley startup, LS9, has figured out how to genetically engineer bacteria so they can turn fermented sugar cane directly into diesel fuel, without creating intermediate chemicals that have to be separated out.

LS9 won an award this week from the EPA -- the Presidential Green Chemistry Challenge Award -- for producing fuel that the company says will compete on cost with $50-per-barrel, petroleum-based diesel, but without the benzene, sulfur and heavy metals that diesel usually contains.

This new "UltraClean" diesel meets standards set by the American Society for Testing and Materials, which means vehicles can run on it without breaking down, and it produces only 15% as much of petroleum-based diesel's greenhouse gas.

As Xconomy has noted, it's "put up or shut up" time for LS9, which is five years old. The company bought a production plant in Okeechobee, Florida, this year, which it is retrofitting, and it plans to produce up to 100,000 gallons of diesel by the middle of next year. If all goes well, LS9 would then start producing its diesel commercially.

Other feedstocks -- wood chips, for instance -- are also being tested, and LS9 is looking at making a wide variety of other products. Watch for jet fuel, gasoline, alcohols, lubricants, resins, soaps and several other chemicals, each produced by its own patented, genetically engineered bacteria.

Here's an interview at peHUB with Noubar Afeyan of Flagship Ventures, the first venture capitalist to back LS9. So far the company has raised about $45 million, but rather than raise more, it's forming partnerships -- with Chevron and Procter & Gamble, so far -- to get its products to market.

(P&G is a supplier to Wal-Mart, which has put its suppliers on notice that they'll be making their products greener if they want to keep selling them at Wal-Mart).

LS9 should also be able to use the infrastructure that already exists -- gas stations, for instance -- to sell its fuel. For a clean tech company, that's a big head start.

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