European Biofuels Travelblog

Instead of "Cellular Lipo-Sculpting Eye Gel", this time the transcontinental party favor was "Relaxing Yuan Zhi Pulse Point Balm".  Thank you British Airways.  The chocolate mousse was mighty tasty, though.  Almost as good as on Air France.  Almost.

Thankfully, the continental leg of the trip was canceled.  Due to security at Heathrow and intense weather across the U.K., I can't say I was disappointed.  Audiences in London and Edinburgh were at least as attentive as those we presented to in Asia, and I suspect this due in part to real concerns about carbon emissions throughout Europe.  In Asia, biofuels seemed to be thought of as more a business opportunity, with carbon emissions as a complication.  In the U.K., in addition to the basic economic concerns, the questions about carbon were more along the lines of trying to understand which fuels and which technologies actually reduce emissions.

Crazy moment of the trip: who should we bump into in the lobby of our hotel in London but John Melo, CEO of Amyris Biotechnologies.  Small world.

China and Future Resource Demands

It isn't news that China has a huge and still growing population, nor that the economy is growing rapidly in the context of an enormous trade surplus.  But looking at what China is today importing, and extending a few trends out into the future a decade or two, gives an interesting slant to food and energy markets that everyone should be thinking about.

I've been digging into these issues as part of Bio-era's consulting practices on biofuels and emerging biotechnologies.  What follows are some notes on trends to watch.

Arable Land:  China is actively moving farmers off the land in an attempt to slow desertification:

The relocation program is part of a larger plan to rein in China's expanding deserts, which now cover one-third of the country and continue to grow because of overgrazing, deforestation, urban sprawl and droughts.

The shifting sands have swallowed thousands of Chinese villages along the fabled Silk Road and sparked a sharp increase in sandstorms; dust from China clouds the skies of South Korea and has been linked to respiratory problems in California.

Since 2001, China has spent nearly US$9 billion planting billions of trees, converting marginal farmland to forest and grasslands and enforcing logging and grazing bans.

The policy is driven in part by concerns over food, as farmland yields not only to the deserts but also to pollution and economic development. China has less than 7 percent of the world's arable land with which to feed 1.3 billion people -- more than 20 percent of the world's population. By comparison, the United States has 20 percent of the world's arable land to feed 5 percent of the population.

...The battle against deserts is playing out across much of western China. Desertification has caused as much as US$7 billion in annual economic losses, the China Daily reported.

Over the past decade, Chinese deserts expanded at a rate of 950 square miles (2,460 square kilometers) a year, according to Wang Tao of the Chinese Academy of Sciences in Lanzhou.

...Global warming also threatens to make a huge dent in grain production, which has already slipped from 432 million tons in 1998 to 422 million tons in 2006 because of desertification. At the same time, grain consumption has risen about 4.4 million tons a year to 418 million tons, in part because of rising demand for beef, chicken and pork.

The production declines have forced China to draw down its grain stocks, and eventually it will need to buy a massive 30-50 million tons a year on the world market, Brown said.

Fresh Water Supplies:  According to an article at Yellow River Conservancy Commission, evidently a Chinese government endeavor:

China has been a production marvel when it comes to labor costs, but not for water costs. To produce a unit of GDP, China uses approximately six times more water than the Republic of Korea and ten times more than Japan, according to Zhai Haohui, vice minister of water resources.

...The water shortage nationwide will reach 50 billion cubic meters by 2030 -- up from the current 6 billion cubic meters, according to the Ministry of Water Resources.

A recent article in the Independent claims that glaciers in the Tibetan plateau, which provide freshwater to much of the country, are now melting at 7% annually.  I've seen that number as high as 13% elsewhere.

Commodities Imports:  The USDA simply says, "China's Demand for Commodities Outpacing Supply".  Demand for corn has exceeded supply in recent years, and I've read that this is the first year they might wind up importing corn.  China already imports enormous amounts of soy; just before I went to Asia in June, the quarterly Chinese buying trip to the U.S. purchased four times as much soy as markets were expecting, $3 billion in one week. 

Meat Consumption: A recent report from the UN FAO, "Livestock's Long Shadow", points out the repercussions from increasing meat consumption around the world: inefficient use of grains, massive consumption of fresh water, increased pollution and greenhouse gas emissions.  Here is a summary from the FAO magazine, carrying the title "Livestock impacts on the environment", which has a link to the full report at the bottom of the page.

Among the most remarkable tidbits from the report, and a key part of the analysis Bio-era is giving to investors in Asia, the U.S., and Europe about the future of commodities usage in regards to biofuels, is related to future Chinese meat consumption.  If China maintains the historical relationship between per capita income and meat consumption (See figure 1.4, page 9 of the FAO report.), by the time it reaches average European income levels supplying all that meat will require 40% of world grain supplies.  40%. 

This is one of those numbers that makes you wonder where and when the current system will break down.  China today has ~15% of world population, and will probably max out at about 18%, with only ~7% of the globe's arable land.  And yet supplying them with mean could consume 40% of the world's production of grain.  Either very strong cultural practices related to meat consumption will have to change (a hard thing to do), or China will be importing a huge fraction of the world's commodities.  Is that the future use of China's massive foreign currency holdings?

Fuel Mix:  According to the USDA FIA "China Bio-Fuels Annual 2007" (PDF), diesel dominates the fuel market in China.  In 2006, 120,000,000 MT of diesel and 40,000,000 MT of gasoline were used across the country (see figure on pg. 8).  Gasoline consumption appears to have leveled off, while gasohol usage has jumped considerably over the last 4 years.

Biofuel Use: The government has put a moratorium on using corn to make ethanol, and may in fact ban that use of corn altogether, but the USDA predicts, "China Fuel Ethanol Production Projected to Increase 12% in 2007":

A report from the US Department of Agriculture Foreign Agricultural Services (USDA FAS) estimates that the production of fuel ethanol in China will reach 1.45 million tonnes (484 million gallons US) in 2007, up 12% from 1.3 million tonnes in 2006. Official production of fuel ethanol in China began in 2004.

...Now, according to the FAS report, plans are to increase ethanol feedstocks from non-arable lands making the use of tuber crops and sweet sorghum. Given the new constraints, a realistic 2010 target appears to be between 3 and 4 million tonnes (1 billion and 1.33 billion gallons US).

...Diesel is the primary fuel used in China. In 2006, China consumed 120 million tonnes of diesel and 40 million tonnes of unblended gasoline. A rise in the use of E10 has caused gasoline consumption to plateau over the last four years. During this time, automobile use in China has increased on average 11.8% annually.

A story at Green Car Congress speculates that, compared the US, cellulose to ethanol may move faster in China because of labor costs.  It's interesting as well that, "China Oil and Food Corporation (COFCO), the country’s largest oil and food importer and exporter, is partnering with Novozymes on the production of cellulosic ethanol."

Offshore Land Deals:  Early this year, Chinese companies signed deals worth US$ 4.9 billion to secure growing rights on 1.2 million hectares (~3 million acres) (Here's the version from Bloomberg, via the IHT).  A similar deal was signed between China National Offshore Oil Corp (CNOOC) and Indonesia, to the tune of US$ 5.5 billion for land to grow crops for ethanol and biodiesel and for processing plants (U of Alberta China Institute,  Biopact).

Finally, China recently announced an increase of planned biofuels use to 20 MMT by 2020.  This is absolutely enormous, as a story at Biopact notes:

The total production of biomass energy from non-grain crops will grow to 500 million tons of coal equivalent, worth some 3 trillion yuan [€290/$385 billion], which will account for 24 percent of the nation's total energy consumption.

In the end, given the shortage of water, the decrease in land suitable for crops, the increase in meat consumption, etc., it just isn't clear where all the biomass is going to come from.  Clearly a great deal of it will be imported, and we can now see where some of China's foreign currency reserves are going to go over the next couple of decades.  Commodities markets are going to get tighter worldwide as a result.

More Amyris and Biofuels News

Amyris Biotechnologies today announced new additions to their Board of Directors, all of whom are formerly associated with BP.  As I have suggested before, Amyris is presently the company to watch in the race for direct microbial production of biofuels (see "The Need for Biofuels Produced Using Synthetic Biology").

Note that, in the "About Amyris Biotechnologies" blurb at the end of the release, biofuels now dominate the stated goals of the company.  I wonder if this might eventually squeeze out the original focus on inexpensive malaria drugs:

   Amyris Biotechnologies (www.amyrisbiotech.com) combines break-through technology and unique insights in the transportation fuels sector to bring environmentally friendly fuels to market. Amyris believes its microbial technology will allow it to reduce the production cost of artemisinin-based anti-malarial treatment to a fraction of its current cost. Amyris is leveraging its technology platform to provide a cost-competitive bio-gasoline, a bio-diesel, and a bio-jet solution that works in current engines and distribution infrastructure without compromising fuel performance. All Amyris biofuels are designed to provide consumers and end users uncompromising alternatives to petroleum-based fuels. Amyris is a privately-held venture-backed company whose investors include Khosla Ventures, Kleiner Perkins Caufield & Byers (KPCB), and TPG Ventures.

The Need for Fuels Produced Using Synthetic Biology

Among the most promising short term applications of Synthetic Biology is biological production of liquid fuels.  But beyond the technical and economic attraction of the project, the reasons we require progress in this area are manifest; diversification of fuel sources thereby reducing dependency on imports, improving air quality, reducing greenhouse gas and particulate emissions that contribute to climate change, eliminating the present coupling between biofuels and food crops, and carbon sequestration.

Bio-era is in the middle of scheduled briefings in Asia, the U.S., and Europe describing the present state of biofuels markets and associated technologies, and these trips, along with recent headlines concerning commodities prices and future fuel demands, have helped clarify the story in my mind.  Below I outline some of the factors in play:

Carbon and other Greenhouse Gas Emissions: The amount of water coming off Antarctica and Greenland scares the crap out of me.  It's true that this isn't my professional specialty, but I have been following the literature on polar ice mass and movement for a decade.  The news is just getting worse.

The present coupling between biofuels and food crops creates upward pressure on food price inflation and reduces (or eliminates) the economic incentive to produce biofuels: Ethanol demand has pushed up the price of corn, and in the U.S. politically motivated trade barriers to Brazilian ethanol derived from sugar cane threaten to keep corn prices high.  Palm oil is presently trading at historic highs, and at a ~30-40% premium to finished diesel, but this is actually driven by food demand, primarily from India and China.  I am a simple physicist by training, rather than a sophisticated economist, but given the increase in food demand I don't see the price coming down even with increased supply.  This puts anybody planning to refine palm oil into biodiesel completely underwater for the foreseeable future. 

China (and India) will require increasing resources over the coming decades: More on this in posts to come.  The numbers are mind boggling.

Ethanol is by no means an advanced biofuel; from both a technical and an economic perspective ethanol is a backwards biofuel: The future is all about producing biofuels that are high energy content (not ethanol), are not water soluble (not ethanol), can be easily integrated into the existing gasoline and diesel distribution infrastructure (not ethanol), and require minimal, if any, initial changes in engine technology (not ethanol).  The average age of an automobile in the U.S. is now at least 10 years (depending on who is counting, and how), which means engine technology turns over very slowly here.  It is faster in other countries (2-3 years in Japan, if memory serves), but this dramatically influences the speed with which new fuels can enter the market.

You don't want to be long on petroleum in ten years:

First, despite a greater than 10% annual growth in auto sales in China, petroleum demand has evidently plateaued due to increased biofuel blending.  I'm not sure I completely believe this yet, but it is an interesting assertion.

Second, three companies are already out in front with funding to use both traditional metabolic engineering and synthetic biology to produce microbes that churn out biofuels:

LS9 is "Developing Renewable Petroleum biofuels: new, clean, and sustainable fuels that fulfill our long and short term energy needs. Derived from diverse agricultural feedstocks, these high energy liquid fuels are renewable and compatible with current distribution and consumer infrastructure."

Synthetic Genomics, Craig Venter's shop, just announced a partnership with BP aimed at using organisms and genes found in subsurface hydrocarbon deposits to develop "cleaner energy production and improved recovery rates".

Amyris Biotechnologies recently received $20 million to develop direct microbial production of liquid biofuels.  Amyris, in particular, is well positioned to make some serious headway.  The company website suggests they are well on their way to making both butanol and biodiesel  (or more likely a precursor to diesel?) in microbes.  In an article in Technology Review, the new CEO, John Melo, says the company has already developed a metabolic pathway to produce a fuel equivalent to Jet-A.  This is particularly interesting given the recent announcement by the U.S. Air Force that it will replace at least 50% of its petroleum use with synthetic fuels by 2010.  In an article by Don Phillips, The New York Times is reporting that, "The United States Air Force has decided to push development of a new type of fuel to power its bombers and fighters, mixing conventional jet fuel with fuels from nonpetroleum sources that could eventually limit military dependence on imported oil."  At the moment, the immediate plan appears to utilize a synthetic fuel produced using natural gas, but anybody who can crack the aviation biofuel nut has immediate access to a 3.2 billion gallon per year market in the Air Force alone.

So how long is this all going to take?  Amyris CEO Melo mentions they hope, "To make a Jet-A equivalent with better properties on energy and freezing point with a $40 barrel cost equivalent by 2010 or 2011".  That's faster than I was expecting, but I find the time scale highly credible.  Below is a figure with data drawn from Jay Keasling's recent presentation to the UC Berkeley faculty senate on BP's investment in the Energy  Biosciences Institute.

The data represents a roughly billion-fold improvement in yield over 6 years.  (I've called this "pre-synthetic biology improvements" because the data is the result of applying fairly traditional metabolic engineering techniques, rather than the combination of Biobricks.  This is by no means a critique of Jay Keasling or his teams at UC Berkeley or Amyris, but rather a simple contrast of methodology.)

You would be hard pressed to find examples of that magnitude of improvement in any human industrial process over any 6 year period, but that is exactly what is possible when you turn to biology.  Moreover, the complexity of the isoprenoid pathway is probably about the same as you would expect for producing biobutanol or a Jet-A equivalent.  This is why John Melo is bullish about making progress on biofuels.  Given that Amyris is evidently already on the path towards butanol, diesel, and aviation fuel, five years is by no means an overly optimistic estimate of reaching commercial viability.  Note that this doesn't mean Amyris takes over the liquid fuels market overnight.  It can take decades for new technologies to make progress against existing infrastructure and investment.

But assuming Amyris, or any other company, is successful in these projects, it is worth considering first the resulting impact on the liquid fuels market, then more generally the effects on structure of the economy as a whole.

The economic considerations of scaling up direct microbial producing of biofuels are fundamentally and radically different than those of traditional petroleum production and refining.  The costs associated with finding a new oil field and bringing it into full production are considerable, but are also so variable, depending on location, quality, and local government stability, that they are a poor metric.  But a very clean measure of increasing gasoline and diesel supplies is the fractional cost of adding refining capacity, presently somewhere between US$ 1 and 10 billion dollars for a new petro-cracking plant, plus the five or so years it takes for construction and tuning the facility for maximum throughput.

In contrast, the incremental cost of doubling direct microbial production of a biofuel is more akin to setting up a brewery, or at worst case a pharmaceutical grade cell culture facility, which puts the cost between about US$ 10,000 and 100,000,000.  Pinning down the cost of a biofuel production facility is presently an exercise in educated speculation, but it is more likely to be on the low end of the scale suggested above, particularly for a fuel like butanol, which, unlike, ethanol, is not soluble in water and therefore does not require distillation; it can simply be pumped or skimmed off the top of the tank in a continuous process.  Beer brewing presently occurs at scales from garage operations bottling a few liters at a time to commercial operations running fermenters processing thousands to many millions of liters per year.  Thus, once in possession of the relevant strain of microbe, increasing production of a biofuel may well be feasible at the local level, thereby matched to fluctuations in demand.  Microbial biofuels could therefore be an excellent initial demonstration of distributed biological production (PDF warning).

In the end, the scalability of microbial production of biofuels depends in part on what materials are used as feedstocks, where those feedstocks come from, and how they are delivered to the site of production.  Whereas petroleum products are a primary feedstock of today’s economy, both as a raw material for fabrication and for the energy they deliver, it may eventually be possible to treat biomass or waste material as feedstocks for microbes producing more than just fuels.  But as I observed above, any biological production process  for biofuels that relies on a sugar or starch crop also used in food production will be subject to the same skewed market dynamics now playing out between food and conventional biofuels.

There are clear challenges to overcome in the years ahead, but given the progress already demonstrated I am comfortable we will find solutions with continued effort.

A Synthetic Enzymatic Pathway for Hydrogen Production from Starch

Zhang, et al., demonstrate a synthetic pathway consisting of 13 enzymes that turns starch into hydrogen.  The paper, at PLoSone, makes clear how important it is to ensure that the definition of Synthetic Biology, if there is a definition yet, includes not just new circuits in cells and new organisms but also cell free systems.  The article (High-Yield Hydrogen Production from Starch and Water by a Synthetic Enzymatic Pathway) is open access, so I won't bother to quote from it extensively.

But the details are pretty cool.  The authors used 11 off-the-shelf enzymes (from spinach, rabbit, E. coli, and yeast) ordered from Sigma, and two they purified themselves (from coli, and P. furiosus).  I imagine it won't be too long before those last two are also available commercially. Here is a paragraph that sums up the context of what the authors accomplished and where they will look for performance improvements:

This robust synthetic enzymatic pathway that does not function in nature was assembled by 12 mesophilic enzymes from animal, plant, bacterial, and yeast sources, plus an archaeal hyperthermophilic hydrogenase. The performance (e.g., reaction rate and enzyme stability) is anticipated to be improved by several orders of magnitude by using the combination of (a) enzyme component optimization via metabolic engineering modeling, (b) interchangeable substitution of mesophilic enzymes by recombinant thermophilic or even hyperthermophilic enzymes, (c) protein engineering technologies, and (d) higher concentrations of enzymes and substrates. ... This research approach will naturally benefit from on-going improvements by others in synthetic biology systems that are addressing cofactor stability, enzyme stability by additives, and co-immobilization, and development of minimal microorganisms that can be built upon to create an in vivo enzyme system that produces H2 in high yields.

What I think is most interesting about all this is that Zhang and colleagues have effectively just put a whole bunch of new Biobricks on the table.  Moreover, those new parts for producing biofuels are reasonably well characterized, at least in vitro.  A cursory search of the Registry of Standard Biological Parts doesn't turn up any of these enzymes, but since the gene sequences are either already in Genbank or are relatively easy to generate, this gap points to an area of expansion for Biobricks in general and the International Genetically Engineered Machines Competition (iGEM) in particular.

I suggest it is time to expand the horizons of iGEM beyond demonstration projects to start tackling real world problems.  The student teams have made fantastic progress over the past few years, with some projects winding up on the cover of high-profile journals.  I would like to see this year's iGEM participants take on biological production of fuels and materials, bioremediation, and biological carbon sequestration.  Even if popular attention has yet to come round, the problems we presently face are enormous (see my post "It's Time to Invest in Water Wings"), and through the combination of enthusiasm and creativity iGEM participants could start developing solutions today.

It's Time to Invest in Water Wings

Waterfront property in Puget Sound and the San Juan Islands is advertised in units of "no-", "low-", "medium-", and "high-bank".  Whenever I dream about a place to watch the sunset from, and to launch my kayak, some sort of beach usually plays a staring role.  But James Hansen and his colleagues say anybody with no- to medium-bank waterfront property could be in trouble fairly soon.

In a paper just published in Philosophical Transactions of the Royal Society, Hansen, the director of NASA's Goddard Institute for Space Sciences, and five eminent colleagues bluntly suggest: "...Civilization developed, and constructed extensive infrastructure, during a period of unusual climate stability, the Holocene, now almost 12,000 years in duration. That period is about to end."

Although the paper carries the rather prosaic title, “Climate change and trace gases”, The Independent leads off its coverage with, "The Earth today stands in imminent peril".  It isn't so surprising that The Independent would start slinging end-of-the-world rhetoric around at the drop of a hat an iceberg,  but in this case (in this case!) I think they are actually getting the story right.

Relying primarily on data, rather than upon climate models as does the IPCC, Hansen, et al., draw very different conclusions about what is happening at the poles of the planet than the recent international consensus report.  As other coverage has noted, the Hansen paper looks closely at what is happening as ice coverage is replaced by water, thereby dramatically lowering the albedo of the earth's surface, concomitantly increasing the amount of solar radiation absorbed at the surface of the planet.

GreenCarCongress notes that:

The authors explicitly disagree with the conclusions of the IPCC, which forsees little or no contribution to 21st century sea-level rise from Greenland and Antarctica. The paper’s authors argue that the IPCC analysis does not account well for the nonlinear physics of wet ice sheet disintegration, ice streams and eroding ice shelves, and point out that the IPCC conclusions are not consistent with the palaeoclimate evidence.

There is significant melting at the poles an on Greenland, and ignoring these phenomena just doesn't seem very smart.  The paper, in short, argues that we must rapidly move beyond even just limiting carbon emissions to agressively sequestering CO2 from the atmosphere.  The best way I can see to do that is with biology.

Consolidation in Biological Tech Sector

Continuing the fine tradition of innovation by acquisition characteristic of many large tech companies, Roche just bought NimbleGen for $272.5 million.

Here are some tidbits from the article:

"This acquisition represents a further milestone in our strategy to strengthen our position as a major player and complete solution provider in the genomics research market," Severin Schwan, the head of Roche Diagnostics, said in a statement.

Roche said the global market for microarray systems was worth about $600 million and grew by 10 percent in 2006.

...NimbleGen's revenues have been growing strongly, from $4.5 million in 2004, to $9.5 million in 2005 and $13.5 million in 2006, but it has accumulated a total loss of $44.5 million as of the end of 2006, including losses of $8.3 million in 2004, $5.2 million in 2005 and $6.8 million in 2006, according to its IPO filing.

Asia Biofuels Travelblog, Pt. 2

If this is Wednesday, it must be Singapore.  No, wait -- the signs all say Hong Kong.  I barely remember Monday.  The schedule says we were in Kuala Lumpur, and so do my photos of the Petronas Towers, but it took 10 minutes of brainstorming with Jim to remember where we had lunch on that day.

In the end, it was the push back on European criticisms of Malaysian palm oil that brought it back for us.  Let me explain: As I wrote about a few weeks ago, there is recent concern that clearing jungle and peat bogs to plant oil palms has been contributing 8-10% of global emissions of carbon dioxide in recent years.  When cleared, the soil and peat release somewhere between ten and fifty thousand years worth of fossil carbon dioxide into the atmosphere.  Such an immense pulse of greenhouse gas into the atmosphere completely overwhelms the benefits of planting this land with any crop destined for refining into biodiesel.  If it is true, we are talking about thousands of years worth of deficit – we are better off, by far, burning petrodiesel.

As a result of this sort of criticism, palm-to-biodiesel investment in Europe has crashed, and The Netherlands has recently banned the import of oil from land that has recently been peat bog.  Granted, the Holland is not the biggest market in Europe by any means, but they have a clear interest in keeping all their reclaimed land dry, which increased carbon emissions threaten via sea level rise.  (I wonder if in Holland you can hear the thunder sounds made by the icecap on Greenland as it melts?)  It is worth considering whether the rest of the EU will follow suit, given the stated policy of reducing carbon emissions by 20% compared with 1990 levels.  Some of the people listening to our presentations about biofuels here are in fact investors in palm plantations, and they were decidedly of the opinion that, at least in Malaysia, no virgin jungle or wetlands are being cleared form growing oil palm.  We were even invited out into the bush to check it out for ourselves.

Perhaps on the next trip.

As a result of the hubbub caused by accusations about carbon release from land cleaning in SE Asia, Malaysia and Indonesia this week sent a delegation to Europe to explain that all is in fact well.  Indonesia is claiming that it has 18 million hectares of degraded land it can use for planting oil palm -- land cleared illegally for timber harvest and now left to rot, as it were.  The word down here is that Indonesia has really cracked down on illegal logging, and the people on the ground seem to think this is credible.  But having just flown over large sections of Borneo, with all the rows of neatly planted oil palm, literally as far as the eye can see from 30,000 feet, I am led to wonder where the truth is.

More news on the topic this week.  From Bloomberg, via The Business Times (6 June, 1007):  According to the story, Indonesia “ups efforts to protect primary forests,” and “won’t allow oil palm growers to cut primary forests for establishing plantations”.  Rachmat Witoelar, Minister for Environment, claims that, “They will be planted in lots already empty.  There are plenty of these, 18 million hectares of them.”  The article goes on to say that Indonesia plans to add seven million ha of plantations by 2011, thereby roughly doubling the global supply of palm oil.

Palm oil has nearly doubled in price in recently, despite the almost quadrupling of supply in recent years.  The price appears to be supported almost entirely by food use of the oil in Asia (primarily India and China), and is presently at a 20-30% premium over the price of petrodiesel.  That means, for the time being, converting palm oil to biodiesel is way underwater.  The only palm oil flowing into gas tanks is due to mandates by national governments for blending, which happens regardless of price.  But that volume is small compared to food use.

Naturally, this leads to a discussion about whether palm oil will stay this high, or whether economic forces will somehow come into play and restore prices to the historical range.  I’m just a simple physicist, but I can’t see prices falling, and my guess is you don’t want to be short on palm oil.

If Indonesia indeed plants all that additional palm, because palm takes a few years to start producing oil, the land will gradually come into production over something like eight years.  This will be completely absorbed by a mere annual ~9% increase in demand, which is less than we have seen in recent years.  The economies of China and India are growing at 8-12% per year, depending on who is doing the accounting.  This suggests anyone who was planning on cheap palm oil for biodiesel is out of luck and needs to find a new feedstock.

But the connection to food markets is a general problem for biofuels these days.  There is already plenty of talk about price pressures on corn due to ethanol demands, and in general biofuels are putting significant pressure on food prices around the world.  And it doesn't look to be the case that we actually have enough arable land or water to simply start cultivating dedicated energy crops at large scale.  There is some hope for jatropha, but it takes a long time to mature and the number of trees presently in production is so small that assertions of it's commercial role are simply guesses.  China is evidently planning on planting 13 million hectares in jatropha -- an area the size of England -- but it just isn't clear what sort of oil production those trees will provide.

All this comes back to Synthetic Biology because in the medium to long term, breaking the connection between biofuels and food crops will only come from building new fuel production pathways in plants and microbes.

More on this in the coming days.

Rob and Jim's Ridiculous Adventure, Or Asia Biofuels Travelblog Pt. 1

(Saturday, 2 June)  Just moments ago, I was annoyed that my e-ticket had been rebooked as a paper ticket, requiring me to carry (and keep safe) 12 boarding passes for my flights over the next 10 days.  But I’ve just discovered a bonus.

Here I sit, not in business class, not in even in first class, but in a “super first class” seat on the top deck of a 747, shortly headed to Taipei and then to Kuala Lumpur along with Jim Newcomb, my colleague from bio-era.  The seat is courtesy of a client, who probably only paid for business class.  I have more legroom here than I do in my living room.  I have to stand up and take a few steps just to see what goodies are stocked in the seat-back pocket in front of me.  When I finally reach the row ahead of me, and retrieve the overnight kit, I find Cellular Day Cream, Cellular Hand Cream, Creamy Moisturizing Lip Balm, and finally, Cellular Lipo-Sculpting Eye Gel.

Jim is stuck back in cattle, err, business class, and I wonder how he is enjoying his Cellular Lipo-Sculpting Eye Gel.  He is that kind of guy.  Formerly of the CIA and various CEO and strategy jobs.  The perfect market for Lipo-Sculpting Eye Gel.  Ah, I know, I’ll regift him my tube of the stuff in order to make up for his lack of legroom.

Let me be clear: I don’t mind the luxury treatment one bit, and I plan to enjoy it.  Because the flight is leaving at 2 AM local and in the next 10 days we will visit 6 Asian financial capitals while giving 5-6 presentations a day, all day, every day.

It’s a tad ironic, then, that these presentations -- and all the associated frequent flier miles -- are in the service of describing the future of the biofuels market in Asia and Europe, which is closely coupled to the desire to reduce carbon emissions.  I’ve been cramming my head full of information about the carbon costs of various biofuels and the effects of carbon regulation on fuels markets.  I’m flying ~20,000 miles in the next 10 days, which, as Jamais Cascio might say, is a hell of a lot of cheeseburgers.

Hmmm…I wonder what the carbon cost is of toting all this Cellular Lipo-Sculpting Eye Gel back and forth across the Pacific at 35,000 feet?  Any thoughts, Jamais?

Changes Afoot

I've now moved on from the University of Washington to spend more time with bio-era and to get my start-up out of my garage.  The transition has left me little time to blog, but I hope to get back to writing more as things calm down a bit.

I'm writing this from the Shangri-La Hotel in Kuala Lumpur, where I am on a trip for bio-era.  More on this in posts yet to come.

The raindrops outside are enormous and copious.