Bloom Bio-Chemicals to Substitute Petroleum-Based Fuels and Plastics
In short:
- The VC fund Extantia supports the founders of Bloom Biorenewables which they consider to have the full potential of becoming a Gigacorn (meaning a company that’s able to save at least 1 billion tons of CO2 a year while being economically viable)
- Bloom has built a technology able to extract compounds out of plants, which can be used to create biofuel for aviation and shipping.
- Furthermore, those compounds can be used to produce eco-friendly plastics, fragrances, food, and medicine.
- In total, the technology is able to save 1,57 gigatons of CO2 a year, which equals the annual emission of France, the UK, and Germany combined – or 3% of global emissions.
The misunderstanding about fossil-fuels
When governments and companies talk about cutting fossil fuel emissions, the conversation typically revolves around transportation and energy. Germany made headlines last summer for generous electric car subsidies that enabled consumers to purchase the battery-powered Renault Zoe virtually free of charge. Meanwhile, the European Green Deal promises a financing boost to renewable energy sources such as wind and solar.
However, fossil fuels aren’t just used to power cars or provide electricity. They’re also in the foods we eat, the clothes we wear, and the flooring and paint in our homes. These products, along with many other everyday items, are made using petrochemicals, which are derived from crude oil. In fact, petrochemicals may single-handedly prop up the oil industry after demand for gasoline peaks. Petrochemicals currently make up 19% of crude oil demand, but London-based commodities analyst ICIS predicts that will increase to 29% by 2040.
While the public and private sectors have primarily focused on getting more hybrid and electric cars on the road and shuttering coal-fired power plants, only piecemeal efforts have been made to wean the world off of petrochemicals. Biodegradable plastics, clothing made without chemicals and biofuels serve as proof that a world without petroleum-based products is indeed possible. That said, the hard truth is that a more sweeping, all-encompassing solution is needed to end our dependence on petrochemicals — a solution like the one the team over at Bloom Biorenewables is working on. The company has an ambitious goal: to replace the chemicals used to create everything from food to fragrances and jet fuel using natural chemical compounds found in plants and trees.
Using All Parts of the Plant
Using plants and trees to completely upend the petrochemical industry sounds like an environmentalist’s dream, but the founding team at Bloom has the experience to make it a reality. The company was launched by Dr. Remy Buser, Dr. Florent Héroguel, and Prof. Jeremy Luterbacher, three chemistry experts who honed their skills in laboratories across the United States and Europe. The Bloom team has spent the past four years in the lab developing technology to extract cellulose, hemicellulose, and lignin from biomass, a catchall term for plants and trees. These three natural polymers make up 75% of plant and tree mass and could be the key to disrupting the petrochemical industry.
Of the three, cellulose is the most abundant and easiest to extract and is already used today to create paper products, clothing, and biofuels. However, extracting cellulose requires wood to be “delignified,” as lignin acts as an adhesive and binds cellulose and hemicellulose together. This process renders hemicellulose and lignin unusable, except as a source of fuel or heat, despite the fact that these two natural polymers could be used in place of petrochemicals in everything from packaging to fragrances and jet fuel.
The commercial potential of hemicellulose and lignin has yet to be realized, but Bloom Biorenewables’ technology could very well change that. The company has developed a unique chemical treatment method that can efficiently separate and stabilize the three primary polymers that make up all plants and trees while preserving their chemical characteristics in the process. This is especially exciting when it comes to lignin as no scientist or company has been able to fully “valorize” lignin, a term chemists use to describe the process of turning organic waste into valuable products, like natural substitutes for chemicals.
The team at Bloom is currently in the process of scaling up the technology and is targeting first the flavors and fragrances market. Companies in these industries help keep demand for crude oil intact by using synthetic substitutes for flavors like vanillin, which gives natural vanilla its flavor, and eugenol, a chemical compound found in cloves that’s used to create both foods and perfumes. The market for vanillin and eugenol alone is over $1 billion every year. Vanillin specifically represents a major opportunity to make a dent in a major industry’s dependence on petrochemicals, with a 2016 study reporting that 95% of vanilla flavoring is derived from synthetic substances.
Long-term, Bloom’s goal is to produce nature-based substitutes for aromatic compounds. Aromatics are petroleum-based chemicals that are used to create, among others, marine and jet fuels, two sectors that have historically been hard to decarbonize. Aromatics comprise 20% to 30% of marine fuel, while in jets the number can run as high as 25%. Put another way, shipping and aviation combined account for 5% of global greenhouse gas emissions. Providing a natural alternative to these aromatics would make a substantial impact on global emissions.
Extantia and Bloom
At Extantia, we invest in companies that can significantly contribute to climate change mitigation. We believe it is important that our portfolio companies have the potential to move the needle and significantly reduce emissions. Therefore, we set the bar high—1% of global emissions—and conduct a careful calculation of the “carbon math” before we invest.
We believe Bloom has the potential to do just that and become a “gigacorn” in the process.
Here’s the math: Around 35-40 million tons of aromatics are produced per year, and Bloom estimates that it can save 19.3 tons of CO2 emissions for every one ton of biomass-based aromatics it produces, compared to what would be emitted in making a petroleum-based product. If production capacity is maxed out, the total emissions savings from natural aromatics could amount to .87 gigatons per year. In addition, the company estimates that providing natural substitutes for the chemicals used to create polymers, drugs, and adhesives could lower emissions by a further 0.7 gigatons per year. Together, this would be 3% of global emissions.
We are excited to announce our investment in the company and its team. We look forward to working with Bloom as they scale their technology and are excited to help the team put the pieces together and solve one of the most challenging parts of the climate change puzzle.
