The U.S. Department of Energy has set a goal of replacing 30 percent of gasoline used in the United States with fuels from renewable biological sources by 2030. So it is hardly surprising that some biotech startup companies are positioning themselves to take advantage of an anticipated booming biofuels market.

While much of the focus is on etha­nol, LS9 of San Carlos, CA, is using relatively new “synthetic biology” techniques to engineer bacteria that can make hydrocarbons for gasoline, diesel, and jet fuel. Hydrocarbon fuels are better suited than ethanol to existing infrastructure, and their manufacture would require less energy.

LS9 is at a very early stage, but it has brought together leaders in synthetic biology and industrial biotech­­nology. The company is equipping microbes with gene pathways that play a role in energy storage in other microbes, plants, and even animals. Other startups, such as Amyris of Emeryville, CA, and SunEthanol of Amherst, MA, are also trying to use synthetic biology to develop biofuel­-producing microörganisms. LS9’s microbes produce and excrete hydrocarbons that are useful as fuels, says ­Stephen del Cardayre, vice president for research and development. Now the company is working to customize the microbes’ products and boost outputs. “We certainly have gone beyond what we think anybody else was even thinking of doing” in terms of producing hydrocarbons, says George Church, a geneticist at Harvard Medical School and an LS9 cofounder.

Noubar Afeyan, CEO of Flagship Ventures, an LS9 funder, cautions that no one can tell the extent to which any biofuel will displace fossil fuels. But, he adds, “the opportunity is so large that I don’t have to believe in much more than a few percentage points of market penetration for it to be worth our investment.” The company is looking for areas where synthetic biology’s potential to produce specific types of molecules will pay off. This could mean making high-performance jet fuel, Afeyan says, or creating gasoline that has no pollution­-causing sulfur content. LS9 also foresees licensing its technology to ethanol producers. Del Cardayre notes that ethanol contains 30 percent less energy than gasoline, can’t be delivered through existing pipelines, and must be mixed with gasoline before being burned in conventional engines. LS9’s fuels would have none of those disadvantages. What’s more, the fuels could be produced more efficiently. For example, at the end of etha­nol fermentation, the mixture has to be distilled to separate ethanol from water; LS9’s products would just float and be skimmed off. Overall, LS9 says, its process would consume 65 percent less energy than ethanol production. The company hopes to bring hydrocarbon biofuels to market in four or five years.

Company: LS9, San Carlos, CA
Funding: $5 million
Technology: Synthetic biology to produce microbes that excrete hydrocarbons
Investors: Khosla Ventures, Menlo Park, CA; Flagship Ventures, Cambridge, MA
Founders: George Church, geneticist, Harvard Medical School; Chris Somerville, plant biologist, Stanford University
Acting CEO: Douglas Cameron, former director of biotechnology research at Cargill, chief scientific officer at Khosla Ventures