This past June, Mitsubishi Plastics announced that it will begin marketing plastic containers made from sugars and rice in early 2008. Mitsubishi represents a growing trend among companies emphasizing the use of environmentally friendly, biobased materials in consumer goods. NEC Corporation also announced earlier this year the development of a plastic containing more than 90 percent renewable material, which it plans to begin using in electronics in 2009.
As a bonus, Mitsubishi has found that its new BMC-5 plastic outperforms petroleum-based polypropylene in most aspects, including keeping its shape and resisting breakage. And NEC found that its composite – made from polylactic acid (PLA) and carbon fibers – conducts heat better than stainless steel, making it a superior material for electronics that generate high temperatures, including cell phones and personal computers.
This attention by manufacturers to the use of energy-saving materials is one of the key factors driving the growth of industrial biotechnology. Their interest coincides with a worldwide push to address the related issues of energy security and global warming, all of which has created opportunity for industrial biotech companies and investors focused on green technology. BIO's Pacific Rim Summit on Industrial Biotechnology and Bioenergy in Honolulu November 14-16 will be a showcase for the industrial biotech innovations that are making these opportunities possible.
Pacific Rim countries are leading the way in this push. A declaration issued in September by the Asia-Pacific Economic Cooperation forum, for instance, calls for "an approach to addressing global environmental challenges that simultaneously promotes sustainable development."
The challenges are well defined. For the past 20 years, Pacific Rim countries have led the world in economic growth, accounting for 56 percent or $37.3 trillion of the world's gross domestic product in 2006. But that growth has relied on use of fossil energy, and future economic growth is challenged by the rising price of oil and the rising costs associated with its environmental impacts.
Governments across the Pacific Rim recognize that biofuels represent an opportunity to both address climate change and energy security issues and to continue economic growth. The market for biofuels reached $20.5 billion in 2006 and is projected to grow to $80.9 billion by 2016. Global demand for biofuels is expected to grow to nearly 30 billion gallons by 2020.
China has joined a number of countries along the Pacific Rim that are promoting biofuels to reduce reliance on petroleum and stem release of greenhouse gas emissions. It has mandated the use of 10 percent biofuels in transportation fuel for some of its provinces and will need 3.2 billion gallons of biofuels by 2016 to meet these mandates. Australia and Japan have set targets to produce and use 92.5 million and 132 million gallons of biofuels, respectively, by 2010. And the United States has a national mandate for use of 7.5 billion gallons by 2012.
Additionally, many U.S. states have set their own mandates for use and production of biofuels. An additional 6.5 billion gallons will be needed by 2020 to meet these state requirements.
Hawaii's Alternative Fuel Standard calls for 85 percent of transportation fuel to contain 10 percent biofuel now and 20 percent by 2020. Hawaii will need 111 million gallons of biofuels to meet that goal. California will require 10 percent biofuel for transportation use by 2009. The California Air Resources Board expects to achieve greenhouse gas reductions of 75 percent through substitution of biofuels for gasoline, based on a recent consulting study.
But its not just biofuels. Global demand for biodegradable plastics made from renewable resources is expected to grow by 9 percent annually through 2010, representing a $20.8 billion market. And the reduction in demand for oil could be significant: The United States currently uses 254 million barrels of oil each year to produce chemicals, plastics and food ingredients.
Industrial biotechnology companies are rapidly bringing innovative processes and products to the chemical industry to meet this demand. Rohm & Haas and Ceres, Inc. in June announced they will collaborate on research targeting production of plant-based alternatives to petroleum-derived methacrylate, reported to have a current annual U.S. market volume of 1.5 billion pounds and value of $780 million.
SPC Green Plastics Inc. plans to use corn and other agricultural wastes, to produce biodegradable, eco-friendly plastics, bio-lubricants and bio-fuels, in the port city of Kakinada, India. And Cargill and chemical manufacturer Ashland, Inc. created a new joint venture for the development and production of biobased chemicals. Its first product will be high-grade propylene glycol produced from glycerin, an abundant co-product of biodiesel production.
These cleaner, energy-efficient processes and new products that utilize renewable, sustainable raw materials instead of oil, made possible by industrial biotechnology, represent a new opportunity for economic growth for the Pacific Rim region. For the latest information on industrial biotechnology in the Pacific Rim region many companies are sending representatives to the Pacific Rim Summit on Industrial Biotechnology and Bioenergy to be held in Hawaii, November 14-17, 2007. For a full conference program, see www.BIO.org/pacrim.