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Enerkem: speeding to market
From a small research laboratory in Sherbrooke University in 1999 to a large commercial facility that will see Enerkem’s gasifier turn Edmonton’s garbage solid into 36 million litres of bioethanol a year, this Quebec company is pursuing aggressive growth. When the facility is operational in mid-2011, it will be the first commercial operation in the world to take municipal solid waste (about 100,000 tonnes annually) and turn it into a renewable ethanol that can be pumped into our gas tanks.
And that’s just the beginning. The privately held company claims its 25-year contract with the City of Edmonton is the only long-term feedstock supply agreement between a fuels and chemicals producer and a large municipality anywhere in the world. Enerkem is modelling its future developments on this partnership.
Speaking at the Canadian Bioenergy Association’s annual conference last October, Denis Arguin, VP Engineering and Project Implementation at Enerkem outlined a similar $250 million deal with a waste management company in Pontotoc, Mississippi for a 20 million gallon/year bioethanol from MSW plant, twice the capacity of the Edmonton facility.
Vincent Chornet, President and CEO of Enerkem, says Enerkem’s aggressive path to commercialization is one of the cornerstones of its success. With 3,500 hours of testing using over 20 different types of feedstock since 2000—first in a pilot then a demonstration plant—Enerkem quickly proved its technology works, lowering investor risk.
In this market, timing is critical. A recent report by Accenture, Betting on Science, Disruptive Technologies in Transport Fuels, identified 12 key technologies, from electric cars to algae, that could transform the way we gas up. But the report warns, “all of the technologies are “in play” now, and there is a race to commercialization. The success of one technology will impact the potential market of the others.”
Still new technology companies can risk everything by trying to commercialize too early. Chornet warns other emerging renewable energy companies “not to skip any steps. Having the long but necessary pilot step is an absolute need before your first industrial scale-up. Don’t try to rush into it, you’ll pay the price after.”
Chornet also urges new companies to be creative. For new companies, finding financing is always the barrier—and Enerkem’s ablity to court a mix of financial partners shows creative thinking. It’s money comes from equity funding, government support and long-term partnerships with industry or municipalities.
One final piece of advice Chornet has for emerging companies? Clear communication. “Make sure your business plan and technology development path are well articulated and that results are well explained to your shareholders.”
Confidence also goes a long way when you’re shopping around a revolutionary idea. Asked what he would have done differently on Enerkem’s route to commercialization, Chornet answered, “nothing.”
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