Are we Heading Towards a New Materials Economy?

by Kimberly Kupiecki

The fermentation broth for bio-BDO, which Genomatica has proven at pilot scale.  BDO is a chemical intermediate used in plastics and spandex. (photo by Genomatica)

Three recent news items have me thinking about the connection between waste, oil prices and materials.

Oil prices just surpassed the psychological barrier of $100 per barrel on January 31st for the first time since 2008. Imad al-Atiqi, a member of the OPEC member’s highest oil policy body in a Reuters interview, Feb. 7 said,

“I expect oil prices to reach $110 during the first half of 2011, however, it could go above that level if Egypt’s current crisis continues.”

High oil prices affect not just the price at the pump but virtually every consumer product produced. From spandex to baby bottles, the $3 trillion chemicals industry consumes 200 million barrels of oil per year in the U.S. alone shackling manufacturers to global energy prices and increasing exposure to emission problems.

Another news item that caught my eye this week was this New York Times story reporting that Hong Kong is predicted to run out of landfill space within the decade.

The question of waste has gained a lot of play in the recent past including other useful things to do with it beside bury it in a landfill. Waste to energy plants or co-located facilities that use the methane from landfills to power operations are gaining more interest from investors.

This week Genomatica (client) with Fortune 500 company Waste Management (client) announced a new way to turn waste into something useful: materials.  The first aim is to turn municipal solid waste into higher-value chemicals by way of syngas. Syngas is nothing new. It is a low-cost input material often used to generate electricity, and also converted into liquid fuels.  What’s different about the Genomatica Waste Management deal is the conversion of syngas to major-market intermediate and basic chemicals that in turn are inputs to all sorts of materials that go into everyday products like car parts, fabric and packaging.

Companies like Nike, Ford and P&G are all taking more interest in their deep supply chain, encouraging major chemical producers like Dow, DuPont and BASF to be more green. The good news is that with processes like Genomatica, being green doesn’t mean higher cost, in fact it can mean lower cost and a more diversified feedstock.

By blazing entirely new pathways to materials, such as waste to basic chemicals, companies like Waste Management and Genomatica are starting the transformation of our materials economy to something more economically sustainable and clean across the entire supply chain.