Published: October 14, 2008 07:18 pm            

Rose alumnus helps broker ‘Next Generation Ethanol’ deal

TERRE HAUTE — The biggest news coming out of this year’s North American International Auto Show in Detroit wasn’t the latest vehicle model being developed by automakers but the announcement of General Motors Corp.’s partnership with Coskata Inc., a relatively unknown cellulosic ethanol company, which could enable the production of ethanol for less than $1 a gallon.

This groundbreaking development was brokered and massaged for nearly a year by Rose-Hulman Institute of Technology 2000 electrical engineering alumnus Wes Bolsen, part owner, chief marketing officer and vice president of business development for Coskata, a two-year-old company with 35 employees based in the Chicago suburb of Warrenville, Ill.

Coskata’s unique three-step “next generation ethanol” process converts carbon-based materials — anything from agricultural residue to rubber tires to garbage — into synthesis gas using well-established gasification technologies. After the chemical bonds are broken using gasification, patented microorganisms at Coskata convert the resulting syngas into ethanol by consuming carbon monoxide and hydrogen in the gas stream. Once the gas-to-liquid conversion process has occurred, the resulting ethanol is recovered from the solution using “vapor permeation technology.”

The Coskata process has the potential to yield more than 100 gallons of ethanol per dry ton of carbonaceous feedstock, reducing costs to less than $1 per gallon, according to Bolsen.

Also, Coskata claims that its process uses less than one gallon of water to make one gallon of ethanol compared to three gallons or more for other processes. Current gasoline production also requires substantial amounts of fresh water. The “next generation ethanol” technology can be used practically anywhere in the world.

“Our process addresses many of the constraints lodged against current renewable energy options, including environmental, transportation and land-use concerns,” Bolsen said. “Alternative fuels from a variety of new sources and raw materials are coming faster than a lot of people realize.”

Then, the fifth-generation central Illinois farm boy proudly stated, “Let’s make American farmers the Saudi oil kings of the next century. Let’s reduce greenhouse gases. Let’s get energy security from foreign oil. And, finally, let’s build the U.S. economy by bringing plants to places where ethanol isn’t there today.”

General Motors executives like those messages, with chairman and CEO Rick Wagoner stating at the auto show that “we are very excited about what this breakthrough will mean to the viability of biofuels and, more importantly, to our ability to reduce dependence on petroleum.”

Later, Wagoner stated: “It’s a very broad-based agreement and it’s about getting this technology as fast as possible and getting it ramped up as fast as possible … We think this absolutely has global applications.”

Wagoner’s announcement showed that GM is ramping up its efforts to advance the production of cellulosic ethanol rather than corn-based ethanol, which is beginning to fall out of favor as escalating corn prices drive up the cost of food. GM hopes to receive its first ethanol from Coskata’s pilot plant in the fourth quarter of 2008 and begin using the fuel in test vehicles at GM’s Milford (Mich.) Proving Grounds.

GM produces more than 1 million flexible-fuel vehicles per year and, in the United States, has more than 2.5 million FFVs on the road. The automaker is committed to making half its production flexible-fuel capable by 2012.

David Cole, chairman of the Michigan-based Center for Automotive Research, praised GM’s equity investment in Coskata.

“I think there’s a potential for this statement here to be one of the most important of the last 50 years in terms of the auto industry,” Cole said. “Just look at the value of displacing, say, a million barrels a day of petroleum with ethanol. I mean, it’s huge. It’s just huge.”

The timing of the GM-Coskata partnership coincides with President Bush’s signing of the Energy Independence and Security Act of 2007, which calls for a dramatic increase in biofuels — from 7.5 billion gallons in 2012 to 36 billion gallons in 2022.

News of the GM-Coskata agreement before about 7,000 journalists resulted in over 600 pieces of media coverage globally within the first 72 hours. Bolsen had a briefing with the top 200 international journalists during the next week, and conducted live interviews with Fox Business News and leading U.S. journalists. He was quickly scheduled to make speaking appearances at the National Ethanol Conference in Orlando and the leading renewable energy conference in Washington, D.C. He was also asked to speak to Chinese government officials in Beijing.

And, everything started with a simple business development “cold call” in early 2007 from Bolsen to Mary Beth Stanek, director of GM’s environment and energy and commercialization division. The automaker was researching “next-generation” ethanol technology companies. Other automakers were approached, but only GM investigated Coskata’s patented technologies through the U.S. Department of Energy’s Argonne National Laboratories. Those studies revealed that for every unit of energy used through Coskata’s process, it generates up to 7.7 times that amount of energy, and it reduces CO2 emissions by up to 84 percent compared with a well-to-wheel analysis of gasoline.

“Wes was key to the development of the partnership between Coskata and General Motors,” Stanek said. “General Motors and Coskata plan to develop sustainable transportation fuels globally and Wes will be integral to those efforts … Wes is a remarkable leader who has great vision, drive and integrity.”

GM Biofuels Communications Manager Alan Adler added: “Rarely have I worked with someone, especially a business partner from outside my company, who cared more about making sure that both parties’ interests were considered in every decision made. Wes is a man whose word is gold and who operates without guile or hidden agendas. He is passionate and driven, which helped make the launch of Coskata with GM at the North American International Auto Show the success that it was.”

And, of course, Bolsen had big fans at Coskata.

“I hired Wes with the expectation that he would help drive the business development function at Coskata and provide some entrepreneurial activity support as well,” stated Coskata Founder Todd Kimmel. “What I got was a highly motivated, resourceful, smart and thoughtful young executive that not only spearheaded the business development activities he was hired to focus on, but stepped up to the plate on marketing, recruiting, finance and many other items that were thrown his way.”

The Coskata team, with GM’s backing, will be able to speed the development of cellulosic ethanol. The company hopes to announce the location of its first full-scale plant, capable of producing 100 million gallons per year of fuel, later this year. That plant could be operational in 2011.

Coskata was founded in 2006 by high-profile energy investors and entrepreneurs, including Khosia Ventures, the venture capital firm headed by Sun Microsystems founder Vinod Khosla. Now, the company has compiled a strong intellectual property portfolio of patents, trade secrets and know-how and assembled a first-class team, including Bolsen, for the development and commercialization of its compelling syngas-to-ethanol process technology.

        

• Click to discuss this story with other readers on our forums.