International chemical firm and major energy customer BASF has invested $30 million in biomass technology firm Renmatix as companies around the world continue to ramp up research and development of alternative bio-based fuels and chemicals for industrial purposes.
Renmatix’ technology allows for the production of industrial sugar from wood, cane trash or straw, the American firm said in announcing the new investment. The privately-held firm already operates a facility in Georgia, where it has the capacity to turn three tons of cellulosic biomass into sugar daily. The BASF investment will allow Renmatix to boost production to industrial scale and become more efficient, Renmatix CEO Mike Hamilton said.
Using cellulosic biomass allows Renmatix to sidestep the food-versus-fuel debate that has dogged production of corn and sugar-based ethanol, and its focus on producing a basic ingredient in many chemical processes allows it to also avoid many of the image problems that have limited broader uptake of biomass fuel in the US as an electric generation fuel. The company’s proprietary “supercritical hydrolysis technology” is called the “Plantrose process.”
Widespread development of bioplastics and use of biomass and biomaterials in chemical processes is the future of the sector, which is currently heavily reliant on refined petrochemicals, the CEO of competing European chemical giant DSM Feike Sijbesma told Breaking Energy earlier this year. Chemical and basic materials companies are at the beginning of the commercialization of these technologies, but have the investment timelines and incentives to research large-scale bio-based solutions in chemical processes currently threatened by energy price volatility.
The German company is also competing with US chemical firms enjoying access to lower-priced natural gas to use in traditional chemical processes. American Petroleum Institute president and CEO Jack Gerard highlighted the role of domestic gas, much of it from shale production, in the booming prospects for the American chemical industry during a briefing on API’s “State of American Energy” report released yesterday.