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Jatropha 2.0: The Bush Blooms in a Greenhouse

Date:	26 Dec 2013

Source:	The Economic Times

Reporter:	Todd Woody

News ID:	2976

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A Californian start-up has domesticated the wild jatropha. It has deals to plant 250,000 acres of it in India, Brazil and other countries and hopes to produce 70 million gallons of biofuel

In an unmarked greenhouse, leafy bushes carpet an acre of land tucked into the suburban sprawl of Southern California. The seeds of the inedible, drought-resistant plants, calledjatropha, produce a prize: highquality oil that can be refined into low-carbon jet fuel or diesel fuel. The mere existence of the bushes is an achievement. Hailed about six years ago as the next big thing in biofuels, jatropha attracted hundreds of millions of dollars in investments, only to fall from favour as the recession set in and as growers discovered that the wild bush yielded too few seeds to produce enough petroleum to be profitable. But SGB, the biofuels company that planted the bushes, pressed on. Thanks to advances in molecular genetics and DNA sequencing technology, the San Diego startup has, in a few years, succeeded in domesticatingjatropha, a process that once took decades. SGB is growing hybrid strains of the plant that produce biofuel in quantities that it says are competitive with petroleum priced at $99 a barrel. Oil is around $100 a barrel. Call it, as SGB does, Jatropha 2.0. The company has deals to plant 250,000 acres of jatropha in India, Brazil and other countries expected to eventually produce about 70 million gallons of fuel a year. That has attracted the interest of energy giants, airlines and other multinational companies seeking alternatives to fossil fuels. They seejatropha as a hedge against spikes in petroleum prices and as a way to comply with government mandates that require the use of low-carbon fuels. “It is one of the few biofuels that has the potential to supply a large fraction of the aviation fuel used today,” said Jim Rekoske, vice president, renewable energy at Honeywell. Rekoske and biofuel analysts say SGB’s biggest challenge will be to replicate the yields it generates in the greenhouse on a commercial scale. “Given that this crop has somewhat of a checkered past, ultimately getting growers to plant it is going to be the key hurdle,” says Michael Cox, an analyst at Piper Jaffray. At the greenhouse, the fruits of SGB’s technology are apparent. A typical wild jatropha bush will produce a cluster of six to eight seedbearing fruits, according to Robert Schmidt, a specialist in corn genetics who is SGB’s chief scientist. He picked up a grapefruit-size cluster growing on a hybridjatropha plant and counted 37 fruits. “We have examples in Guatemala where we have 60 fruits in a cluster,” Schmidt said. SGB’s success at improving jat ropha seed yields by as much as 900% persuaded a consortium that includes Airbus, BP and the Inter-American Development Bank to sign a deal with the company to plant 75,000 acres of jatropha in Brazil. The consortium, called JetBio, aims to develop sources of biofuel for the airline industry as EU, Australia and other countries impose caps on aviation carbon emissions. “The demand is huge: every single airline would like to fly on biofuel today,” Rafael Davidsohn Abud, JetBio’s managing partner, said. Jatropha ’s value as a cash crop, though, may pale compared with a potential genetic gold mine SGB has begun to discover, identifying traits, for instance, that make certain strains of the plant resistant to extreme heat or cold. “If you figure out how to do heat tolerance for corn or soybeans, what is that trait worth as climate change accelerates?” asked Arama Kukutai, MD at Finistere Ventures, a San Diego venture capital firm that has invested in SGB.
The Beginning
The seeds of Jatropha 2.0 were planted in the fall of 2008. On September 15, a Monday, Kirk Haney, SGB’s chief executive, went into his living room to prepare for what was to be a watershed week for his year-old start-up. That Friday, SGB was set to close a $200 million round of financing from European investors. “I turned on CNBC and Lehman Brothers had just failed and the Dow was plummeting,” said Haney, 42. SGB had intended to use its financial windfall to plant farms around the world. Two days after Lehman fell, the investors pulled out, forcing Haney to devise a new strategy. As Schmidt combed the scientific literature on jatropha, he stumbled across a reference to an obscure 30-year-old paper by the botanist Bijan Dehgan, who had devoted his career to studying jatropha. Following up on Dehgan’s thesis that Guatemala was a jatropha Eden, Schmidt went to Central America and began analysing the genetic makeup of the plants there. “It was absolutely spectacular the amount of genetic variation that we collected from the centre of origin,” he said. That discovery coincided with a plunge in the cost of DNA sequencing that has allowed SGB scientists to rapidly identify the most genetically diverse and productive plants and crossbreed them. It also lets them pinpoint profitable individual traits and mutations, like heat or cold resistance. It costs SGB $350 to genetically map a single jatropha line to look for valuable mutations, a price that will drop to $50 in 2014. The price five years ago? About $150,000, according to Eric Mathur, SGB’s chief technologist. The machine that does the mapping cost $250,000 and is in SGB’s laboratory in a San Diego office park. SGB’s technology allows its scientists to identify potentially productive hybrids in the laboratory at the molecular level before the plants are crossbred. “This used to be a 10-year discovery process,” Mathur said. “It’s more like a 10-month process now.” Much of the hard molecular biological work is done, Haney said, giving SGB a five-year head start over any agriculture giant that might try to replicate its success. “It doesn’t matter how much money you have,” he said. “You can’t make cells divide quicker.”

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A Californian start-up has domesticated the wild jatropha. It has deals to plant 250,000 acres of it in India, Brazil and other countries and hopes to produce 70 million gallons of biofuel

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