Biotech Companies Step Up Efforts in Biomass R&D.

Business Editors & Health/Medical Writers

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SAN DIEGO--(BW HealthWire)--June 26, 2001

-Biotech companies are increasing their research on the use of biomass as alternative fuels in light of rising energy costs and increasing power outages, according to experts meeting at the Biotechnology Industry Organization's annual conference, being held this week in San Diego. Biomass research is also being explored as a source of other bio-based products.

"Recent increases in gasoline, home heating oil, and natural gas prices have made everyone aware of how critical it is for us to develop new sources of energy," said Brent Erickson, director of BIO's environmental and biotechnology section. "BIO member companies are using genetic research to produce enzymes that will convert abundant agricultural biomass into fuels and plastics."

Biomass efforts are being spurred on by U.S. government support at both the presidential and congressional levels. Congress has allocated $250 million over five years to establish an interagency research and development program to use biomass to produce energy, transportation fuels, and other products. Last year, then President Clinton signed the National Sustainable Fuels and Chemical Act. Through 2005, $49 million will be allocated annually to explore applications of biomass as an alternative energy source.

"The pharmaceutical and agricultural sectors of the biotechnology industry get most of the attention in the trade and consumer press, and rightfully so," notes John Sterling, managing editor of Genetic Engineering News (GEN; www.genengnews.com). "But the recent energy crises in California and elsewhere have highlighted the need for cheaper and less polluting forms of fuel. Biotechnology is tackling this problem head-on."

Among the key players in the race to turn biomass into useful products are Genencor (NASDAQ:GCOR), Diversa (NASDAQ:DVSA), Protein Polymer Technologies (OTCBB:PPTI), Eastman Chemical Co. (NYSE:EMN), Novozymes Biotech (an R&D subsidiary of Novozymes A/S; U.S. OTC:NVZMF), and Cargill Dow (a 50-50 joint venture of Dow Chemical (NYSE:DOW) and Cargill Inc. (private)).