From Concept to Commercialization

Figuring out how to make fuel and chemicals from biomass is only the first step, making those processes economically viable is the ultimate goal. Researchers at the National Renewable Energy Laboratory in Colorado work with large and small businesses to turn their discoveries into commercial successes.
By Jerry W. Kram | January 17, 2008
The National Renewable Energy Laboratory is situated near the base of a rise on the west side of Golden, Colo., with a view of the Denver skyline. In its labs, scientists and engineers grapple with the challenge of turning promising concepts into commercial energy sources to increase America's energy independence while easing our impact on the environment.

NREL is operated by the U.S. DOE. The lab has been working on biomass for nearly 30 years along with wind, solar, geothermal and other alternative energy resources. The DOE reorganized its alternative energy programs in 2001 to coordinate research on the different alternative energy sources. NREL became the lead lab in the National Biomass Initiative, which coordinates the biomass work of five national energy labs.

A tremendous amount of research is conducted at NREL and the other national labs. That research wouldn't be worth much if the labs didn't have a strong relationship with the private sector. John Ashworth is acting director of the National Biomass Initiative and head of partnership and business development for the biomass program at NREL. He is responsible for bringing businesses and entrepreneurs together with researchers and engineers with the expertise to make their ideas a reality.

There are many ways to form a business partnership with NREL. "We get associated with companies three different ways," Ashworth says. "A company comes to us with an idea for a process or an idea for a piece of equipment and asks if we can help them by testing the equipment or replicating the process or giving them technical advice."

Sometimes NREL is the customer, looking for some obscure bit of expertise for a project or client. "No. 2, which isn't as common, is that we have a research need," Ashworth says. "We need to find a way to do something better than anyone can do it today. We may go out and look for someone who can help us with that by buying their equipment or having them build something that nobody has ever built before. A lot of the pieces in the pilot plant are custom, nobody had ever built them before."

Finally, some companies approach NREL to do joint projects. This has been a growing source of work for the lab as the DOE has put more emphasis on funding corporate research projects. "The last one, which has been the big driver over the past six years, is that the DOE has decided that one way to get private companies involved in commercializing technology is to put out matching money. So starting in about 1999, NREL has had big solicitations, where they put $20 million to $30 million or recently $200 million on the table and tell companies to put together a team that can do the work. In a lot of cases, people come to us and ask, 'Would you partner with us if we win [the bid]?'"

As this Biodiesel Magazine staff writer was visiting the lab, one of these partnered projects was coming to fruition. Although Ashworth couldn't share details because of confidentiality agreements, he did say that the lab's pilot plant, the Alternative Fuels User Facility, was being fitted for some equipment developed by NREL and DuPont. "We've been working with DuPont for 3 years," he says. "We're doing the proof-of-concept pilot plant run for their process using our facilities and our people. It's an $8.5 million cooperative research program and this is the payoff. This is the proof that all the stuff we have done over the past 3 years actually works at scale."

There are not many places in the United States where companies can do pilot-scale research, short of building their own facilities. That's what makes the AFUF so attractive to corporations looking to create a new process without wiping out their own bottom lines. Ashworth says the lab has successfully worked with most of the major companies in the ethanol business including Poet LLC, Archer Daniels Midland Co. and Abengoa Bioenergy.

Contract Talks
The lab has designed several different levels of contractual agreements to work with companies and meet the requirements of different kinds of projects. "I will give the DOE some credit, they have tried to streamline the process," Ashworth says. Years ago, people told the DOE that the process was cumbersome. "It was particularly cumbersome if you wanted to do something that was very simple," he says. "What we have tried to do is create an instrument that allows people to make use of our people and facilities very quickly."

The simplest agreements are with companies that want a particular analysis or research question answered. This is handled under an analytical services agreement. "It just says you have something you want us to analyze or just look at," Ashworth says. "In the biomass case, it could be a feedstock that you want us to tell you what's inside. It's a one-page piece of paper that says 'We'll do this, you pay us X, and we'll give you the data and everyone goes home.' There is no intellectual property, no discovery, just the information." An agreement of this type can be negotiated in a week or less.

More in-depth analysis is handled through a technical services agreement. These analytical projects can last up to a year. For example, the lab tested a feedstock for fermentation every three months to see how the feedstock changed with the seasons, or in storage, Ashworth says.

The more typical relationship between a company and NREL is negotiated in a cooperative research and development agreement or CRADA. "[In a CRADA] that's where we are actually doing research-there is intellectual property being created," Ashworth says. "There is a lot of concern about who will wind up owning that at the end of the day. So there are terms and conditions totally open to negotiation on who owns what. At the end of the day you work that all out and it will say something like, 'If your scientists discover it, you own it. If our scientists discover it, we own it and will license it to you for commercial purposes.'"

These contracts are important because as a government agency the lab is required to make its discoveries available to the public. "We are bound by government rules, and one of those rules is that if the lab's equipment is used, the government retains a research license to whatever it has invented," Ashworth says. "It doesn't mean the government will commercialize it, but if it is something important that pushes the technology forward the government wants to be able to work on it."

The complexity of CRADAs requires a longer time period for negotiations. Ashworth says it can take from one to eight months, depending on the intricacy of the agreement. "It depends on how much intellectual property is being brought to the table," he says. "For example, in our work with DuPont, we had a lot of background intellectual property they wanted to use. So that means you had to figure out who licenses what and what are they going to pay. They also brought their own intellectual property because they have a tremendous research program. You have the terms and conditions and then you have to have the lawyers look at the terms and conditions." Once those terms are set, a CRADA can be approved locally so work can begin quickly, Ashworth says. "In general, if we can agree on all the background stuff, it can get going pretty quickly," he says. "Basically we just need to know what the work is going to be, who's going to pay what, and what are the milestones and deliverables. The local field office approves it and we move ahead."

At one time, the lab was involved in a number of what it calls work for others agreements where the company paid 100 percent of all the costs involved in the research project and retained all the intellectual property rights. These are generally limited to replicating or scaling up research that has already been completed by the business involved. "We don't do a lot of those any more," Ashworth says. "We found that when we got into these agreements, by and large there were always discoveries. People were always coming up with better processes and it just causes big issues down the line. We will still do them, but we are pretty insistent that you know what you are doing. You can't just have an idea, but you have to have a dialed in process and you just want us to prove it on a larger scale."

Technology developed by NREL is licensed to the industry. However, research done under a CRADA generally isn't published for five years to allow NREL's partners the chance to commercialize it first. Ashworth's favorite example of a widespread NREL-developed technology doesn't come from biofuels or biomass research, but from the lab's work in wind power. Most of the windmills sold today use an advanced blade design developed at NREL. The lab also licenses microorganisms that it has discovered and developed such as Zymomonas. The income produced from those licenses goes back to the lab. However, Ashworth says the main purpose of the license is to make sure the technology is being used. If the technology isn't being used, the license is revoked. "We've had that happen," he says. "A company licensed something to prevent a competitor from getting it. After about 18 months we took it back." The number of agreements in place at any one time varies, Ashworth says. With more money going into cellulosic technologies NREL's biomass program has been busy. At any one time, the company can be working on three or four CRADAs, and a half-a-dozen analytical service agreements. Then there are a number of technical service agreements which take only a week or two to complete.

As the biomass industry expands, NREL is looking to expand its facilities. "We will double the size of our pilot facility, AFUF, in the next two years," Ashworth says. "Part of the reason we're doing that is so we can run more industrial collaborations in parallel. Right now we have many pieces of equipment that are used quite heavily, and you can only use something 24 hours a day." NREL is also enlarging its thermochemical biomass conversion facility.

Working Together
The nuts and bolts of molding a working relationship depend on the type and scale of the project. Once an agreement is in place between NREL and a business, it is up to process engineers like Andy Aden to implement them. "Most of the research I do is on process design and economic analysis," he says. "I take the research in the laboratories and see what economics and designs are on the commercial scale-see what the biggest areas of improvement are going to be and things of that nature. I try to make sure things are cost effective for industry to implement."

The scale of the work Aden does depends in large part on how far the company has advanced in its own research. "Basically we work with that partner to figure out how much data they already have," Aden says. "If we are going to the pilot scale, that means they already have some amount of bench-scale research." NREL can also help develop bench-scale experiments if the company's research isn't that far along. The lab can help ensure that the companies have all the information they need to move ahead with their process. "For example, if we are doing pretreatment research we're geared to doing dilute acid pretreatment, but there are a lot of other chemistries you can use," Aden explains. "So we would get to the point where we feel there is sufficient background data before we feel justified in going to the larger scale. Then we would have to see if the existing equipment we have would satisfy their needs or if we'd have to purchase some equipment to fill their needs. That's one of the reasons we are expanding this facility over the next couple years, to anticipate the needs we have heard from industry."

While testing a new piece of equipment such as a new pretreatment digester would require some repiping of the pilot plant, Aden says more time would be taken to develop standard operating and safety procedures. The pilot plant was designed to make swapping equipment in and out as easy as possible. "We try to do as much plug-and-play systems as possible," he says. "Theoretically, if someone wanted to do a butanol fermentation instead of an ethanol fermentation we use this existing equipment, just different organisms," Aden says.

NREL is one of the few facilities in the country that can work with bioenergy processes ranging from a few grams in a laboratory flask to up to a ton a day in the pilot facility, according to Jim McMillan, principal chemical engineer for the National Bioenergy Center. "One of our strengths is that we have this whole spectrum of scales so some company doesn't have to over-invest because they have only a certain scale of equipment for a limited amount of time," McMillan says.

NREL's other strength is that few other institutions can match the level of experience it has working with biomass. This level of experience makes NREL a source for training and teaching future researchers and industry leaders about biomass. "The industry is nascent right now," McMillan says. "You are starting to see companies with internal research programs and some funding in academic areas. So you will have some students who have done work with this material, but the talent pool is still one of the bottlenecks for the industry. That's one of our roles, bringing on a lot of teachers, a lot of summer interns and in some CRADAs we will train people in the companies. That's sometimes an important part of the project."

As the technologies for cellulosic ethanol are ramped up to commercial scale the excitement is intense. "Look out for the next five years," Aden says. "With industry's help there are going to be significant strides made. I can't wait to see exactly what's going to take place. The common phrase used to be 'it's always five years out,' well steel's going in the ground right now. It's going be interesting to see how successful biomass is and who's successful because there is a variety of players out there now and it's anybody's ballgame."

Jerry W. Kram is a Biodiesel Magazine staff writer. He can be reached at or (701) 738-4962.
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