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have capacity to generate 250,000 gallons of cellulosic ethanol per year, Verser says.
But that’s still just a drop in the bucket. If ZeaChem can show in Boardman that it can really put all the pieces of this puzzle together, and run an efficient demonstration plant, then it will be in position to talk about big time production. A full-scale commercial plant, which could produce 100 million gallons of cellulosic ethanol per year, is estimated to cost about $400 million. ZeaChem expects to talk with big chemical or oil companies with pockets deep enough to take on a project that big, Verser says. It will be 2013 or 2014 at the earliest before the company could be in a position to make ethanol at commercial scale, he says.
But ZeaChem is seeking to hedge its bets ever so slightly, to make its business about more than just ethanol. Its process can also be used to make chemical intermediates that go into latex paints and adhesives. The company also isn’t wedded completely to poplar trees, saying its process is “feedstock agnostic” and that it should work on other cheap sources of biomass like sugarcane, switchgrass, or corn stalks and leaves.
There are plenty of competitors in the ethanol race, like Lebanon, NH-based Mascoma, Marlborough, MA-based Qteros, Cambridge, MA-based Verenium (NASDAQ: VRNM), Broomfield, CO-based Range Fuels and others. Some, if not all, of them are sure to flame out. But if anyone proves that cellulosic ethanol can be mass produced, the market is potentially a big one. The Renewable Fuel Standard calls for 36 billion gallons of renewable fuel to be produced in the U.S. by 2022. Even a small slice of that market share could yield sizable returns for a startup like ZeaChem, with a little more than 30 employees, and $40 million of venture capital investment.
“The number of plants is huge, there could be hundreds of facilities,” Verser says. “There’s a lot of space there if all this happens on a time frame and a pace people expect.”
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