Bioethanol stimulates growth for Novozymes and worldwide debate

The production of bioethanol for fuel has increased in recent years, creating rapid growth for Novozymes. For society, biofuels create both opportunities and challenges, and we take these issues seriously.

In 2007, sales of enzymes to the bioethanol industry comprised 13% of Novozymes’ total enzyme sales. Enzymes for bioethanol is our fastest-growing product area, and we are very optimistic about future developments. In fact, we anticipate an average increase in sales of 20-25% annually over the next 3-4 years.  

Full speed ahead in the USA
Novozymes is the largest supplier of enzymes to the bioethanol industry. Most of the global production of ethanol from corn takes place in the USA, so it is mainly sales to the American market that are on the increase – and the American market is so important to Novozymes that we are now expanding our production capacity in the USA.

But all around the world, exciting markets are opening for Novozymes’ enzymes for bioethanol production. Novozymes has entered into partnerships with companies including POET in the USA, Abengoa in Spain, and COFCO in China.

Most recently, in September 2007, Novozymes began a partnership with the Brazilian sugarcane industry’s technical center CTC (Centro de Tecnologia Canavieira) with a view to developing bioethanol from bagasse – a by-product from the production of sugar from sugarcane.

Sustainable bioethanol
In 2007, there has been widespread debate about the advantages and disadvantages of using bioethanol instead of petrol. Novozymes advocates the use of bioethanol, for several compelling reasons:

• Bioethanol helps safeguard future energy supplies
  Bioethanol is based on renewable raw materials – this means it can help safeguard future energy supplies and reduce our dependence on fossil fuels.
  
  

• Bioethanol reduces CO₂ emissions from the transport sector
  In the USA and Europe, it has been documented that replacing petrol with first-generation bioethanol can reduce CO₂ emissions by about 20-40% – provided there is no change of agricultural practices. For second-generation bioethanol, the CO₂ savings are up to 90%.
  
  

• Bioethanol creates financial growth in rural areas and developing countries
  In the USA, parts of the corn-producing Midwest have experienced an economic upswing, and the demand will also have a positive effect in developing countries. The increasing demand for starchy raw materials can give farmers in developing countries the opportunity to sell their crops on the biofuel market. 

Challenges
However, it is necessary to be aware of possible challenges associated with using biofuel:

• Rising food prices
  This applies particularly to the price of corn, which has increased considerably since mid-2006. Many factors have influenced price rises – including the increased production of first-generation biofuel. A bad harvest in some parts of the world in 2006, combined with increased demand in India and China, has also had a major impact. About 8% of the global corn production in 2006 was used to produce ethanol.
  
  

• The risk of increased use of fertilizers and deforestation
  Producing biofuel can lead to an increase in the use of fertilizers, which are harmful to aquatic environments. In some areas of the world, rain forests and other vulnerable areas are being converted to cultivate crops used for biofuel production. Novozymes is actively working towards introducing a global certification scheme designed to prevent this. The certification scheme will ensure that the biofuels sold are produced in a socially and environmentally responsible way.

At www.biomass.novozymes.com you can find more information on the opportunities and challenges of using bioethanol and on Novozymes’ opinions.