Obama's biofuels policy boosts California-based Novozymes Inc.

The Sacramento BeeMay 6, 2009 

The biofuels business has stalled in the last year, but in Davis, Novozymes Inc. is revving up.

The Danish-owned company will expand its local footprint by half next week when it moves into two new research buildings. It's part of a long-term expansion that will add about 50 positions at the south Davis campus over several years. Novozymes aims to own the market for the enzymes that someday may be used to produce billions of gallons of ethanol a year from plant fibers instead of corn.

The cellulosic-ethanol push is "the biggest single undertaking we've ever had in R and D," said Lars Hansen, president of Novozymes North America. "This is really something that could transform our company."

The Obama administration boosted Novozymes and the rest of the biofuels sector Tuesday with a raft of policy and funding announcements meant both to help the gasping corn-ethanol industry and to speed the commercialization of biofuels that aren't made from food.

The White House directed the federal Department of Energy and Department of Agriculture to work with the U.S. Environmental Protection Agency to craft a long-term national strategy for the industry. Energy Secretary Steven Chu outlined a $786.5 million plan meant largely to help the fledgling cellulosic ethanol industry. Department of Agriculture spending would target next-generation fuels as well as the existing corn-ethanol sector.

Corn ethanol accounted for nearly all the roughly 10 billion gallons of alternative fuel burned in the United States last year. Under federal rules adopted in 2007, corn ethanol use will grow to 15 billion gallons a year by 2014 and then likely level off. By comparison, U.S. vehicles burned about 138 billion gallons of gasoline last year.

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