An Amyris demonstration facility in Brazil. Credit: Noah Friedman-Rudovsky.

In its early years, biotech company Amyris described itself as a start-up “applying its proprietary breakthrough technologies to address major global health and energy challenges.” 

Its originally planned to make an anti-malaria drug, as well as renewable diesel and jet fuel, by feeding sugar to genetically-engineered microorganisms. Having spun off the anti-malaria technology to another company in 2008, yesterday Amyris said it’s giving up making fuels too. Instead, it will to focus on higher value products, such as moisturizers for cosmetics.  

The company learnt first hand just how difficult it is to achieve the kind of yields seen in lab tests in large-scale production. In an update call for investors, CEO John Melo said he is “humbled by the lessons we have learned.”

This is a common theme for advanced biofuels companies. Range Fuels, one of the first of the current crop of companies, recently went out of business. Others are giving up on making biofuels too, also hoping to break into markets for higher value chemicals. Although they may be able to get more money per liter of product, some experts warn that these markets are also highly competitive.

Amyris’s technology may still be used to make renewable fuels, but this will happen not at Amyris, but under joint ventures established with Total and Cosan. These ventures will need to build up their own production capacity, Melo told analysts.

On the same call, Melo told investors not to expect the company to produce as much product as it had previously promised. Amyris had said that in 2012 it would produce 40 to 50 million liters of farnesene, a fragrant oil that can be used for making various products including diesel. Melo said Amyris would stop making predictions about its production levels, turning its attention away from ramping up production and toward achieving consistent yields. He also said Amyris is indefinitely delaying plans for one of two large production facilities it was to have built this year. 

Not all biofuels companies are backing off from biofuels though. Mascoma, which has developed a process for making ethanol from cellulosic sources such as wood chips, announced in December that it had fully funded the construction of a cellulosic ethanol plant. Construction is expected to begin within a few months, to be completed by the end of 2013.

A Volt outside GM's headquarters in Detroit. Credit: Flickr / Landlessness.

Electric vehicle enthusiasts (and critics) are keeping a close eye on sales of GM’s Volt this year to get a sense of whether electric vehicles will really finally catch on. GM has said that it hopes to sell 30,000 Volts in 2012, which would mean selling, on average 2,500 a month. It’s far short of that pace for January having sold just 603.

The January figure markedly down from December, when GM delivered 1,520. But sales were actually up substantially from the same time last year, when GM sold 321 of the cars—however, at that time, the Volt was only available in a few states. 

GM didn’t meet its goal of selling 10,000 Volts during 2011, for a number of reasons. In fact, it’s still short of 10,000, with total deliveries of 8,600 vehicles since sales began at the end of 2010.

So, do slow sales in January mean GM won't reach its goal?

There are a number of factors that could explain the slow January sales. Customers hoping to get the Federal tax credit for the car for the 2011 tax year may have rushed to buy in December. Also, at the beginning of January, GM announced a retrofit that will make the car safer. The cars on the lots in January (about 4,400 were there at the beginning of the month) were not retrofitted yet, and the parts needed to do the retrofits weren't widely available. So anyone buying a car in January would have to take it back in a month or two to have the changes made. GM also announced in January that cars built later this year would have low enough emissions to qualify for driving in California’s HOV lanes, an attractive perk.

All in all, potential customers had a lot of reasons to wait until later this year to buy a Volt. It’s too early to call whether the company could sell 30,000 this year. It’s also too early to say how important sales of the Volt are, at least in terms of the overall prospects for electric vehicles. But I’d be interested to hear what readers think. How much is riding on the success of the Volt this year?

A Fiat Multipla Bi-power car being refueled. Credit: Andreas Geick

America’s presidents can’t make up their minds about how to reduce dependence on oil imports.

President Bush was a enthusiastic support of fuel cells, until he was an enthusiastic supporter of ethanol made from switchgrass. President Obama has come out strong for biofuels and electric cars, but he didn’t mention those in his State of the Union address this week. Now he wants researchers to invent new ways to use natural gas to power vehicles.

The hope is to create a market for natural gas, which is pouring from the ground in record amounts in the United States, and in turn driving down natural gas prices to levels not seen for 10 years. 

It’s easy to use natural gas in internal combustion engines, but it’s hard to store much of it on board a car, so natural gas vehicles typically have a much shorter range than gasoline powered ones. The White House announced today that the Advanced Research Projects Agency for Energy (ARPA-E) will announce a research competition for either improving natural gas powered vehicles, or developing a cheaper way to turn the gas into an energy dense liquid fuel. (The announcement referred to ARPA-E’s previous funding rounds as “competitions,” so it’s likely this will just be another funding round, not something like the DARPA challenge competition to develop autonomous vehicles.)

The White House also announced a plan to encourage the use of natural gas in trucks: 

Reducing our dependence on oil by encouraging greater use of natural gas in transportation: The President’s plan includes: proposing new incentives for medium- and heavy-duty trucks that run on natural gas or other alternative fuels; launching a competitive grant program to support communities to overcome the barriers to natural gas vehicle deployment; developing transportation corridors that allow trucks fueled by liquefied natural gas to transport goods; and supporting programs to convert municipal buses and trucks to run on natural gas and to find new ways to convert and store natural gas.

Will natural gas transportation prove a fad? Unlike fuel cells, advanced biofuels, and electric cars, natural gas vehicles are already sold in large numbers, particularly outside of the United States. In the long term, especially if natural gas remains cheap, they will find a market in the U.S., too. But if political support for it depends on quick and widespread adoption, or on breakthroughs in turning the gas into liquid fuel, the support won't last, and we can look for some other transportation solution to be highlighted in the next State of the Union speech.