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This is a contributed post from Stephen J. Gatto, Chairman and Chief Executive Officer of Myriant Corporation.

Commercially and technologically there can be little doubt the bio-based chemicals industry is at its tipping point. According to BIO, the world's largest biotechnology trade association, there are approximately 2,000 companies today in the United States that either manufacture or distribute nearly 20,000 bio-based products, including bio-based chemicals and "green products" for consumer and industrial applications. But politically, policy-wise, if House and Senate efforts aimed at displacing the "whole barrel of oil" aren't forged soon, we may find ourselves at a Congressional juncture perhaps more accurately described as yet another tripping point.

The need for a national energy policy inclusive of bio-based chemicals and products could not be clearer or more urgent. The world population is on the rise and is expected to top out at 9.5 billion by 2050, up from about 6.5 billion today; a population using and depleting oil resources. This isn't sustainable or affordable, particularly considering the systemic shift in oil prices over the last several years. The bio-products industry today is one of the most immediate steps we can take to develop a more sustainable way of living. At the same time, our ability to harness our national, home-grown strength in agriculture and our leadership in industrial innovation has the potential to drive substantial economic development in the United States by spurring job growth and potentially ameliorating trade deficits in this sector.

What We Need is Downright Simple, and the Upside is Immense

Congressional gridlock isn't new. What is new is that the United States is no longer the country that could safely afford to wait it out. In the past, our substantial monetary, labor, intellectual, manufacturing, technological, and dominant global market advantages could quickly and reliably make up for time lost to policy wrangling. But not any longer. Consistent policy is necessary now.

Ironically, many necessary policies are in place today but their very existence is in jeopardy, put on the proverbial chopping block by partisan-centric debates about budget cuts and deficit reduction. Rather, the discussion ought to focus on programs that are working now and ways to make them better. For example, a renewed Farm Bill Energy Title inclusive of bio-based chemicals is a good start. To not include mandatory funding for these vital programs--which account for less than 1% of all Farm Bill funding--is akin to no funding at all. Over the last five years, key Energy Title programs within the Farm Bill, including BCAP and bio-refinery assistance programs, are vitally needed to further strengthen the bio-products industry in the United States.

Along with the Farm Bill, credits and enhancements that reward U.S. investments in bio-based manufacturing should be encouraged. S.1764, "Make It in America Tax Credit Act of 2011," as an example, serves to extend and modify advanced energy investment project credits and would also enable qualifying bio-based products and other alternatives to petrochemicals to be eligible to receive investment tax credits.

Similarly, extension of the New Market Tax Credits program, which serves solely to incentivize investments that create jobs and provide services in economically disadvantaged areas, also has the dual benefit of significantly reducing a project's capital needs by up to 20%, typically in the form of low-interest debt. This program, in combination with those that enable access to low-cost working capital, for example through Ex-Im Bank, are for now the best incentives for U.S. companies keep bio-based manufacturing projects here in the United States versus opting to build in places like China and Malaysia. The pattern of "innovate here but build there" should not be enabled to proliferate, particularly when rural America so desperately needs a clear pathway for economic development.

As a marker, a 2010 study, also conducted by BIO, projected that the renewable chemical industry has created or prevented the loss of 40,000 jobs. In the United States, bio-refineries that process sustainable biomass can generate $88.5 billion in economic activity according to USDA projections. According to an Iowa State study, the bio-based industry can generate a minimum of 100,000 jobs annually. With the Country's unique leadership position in agriculture and innovation, and given that the U.S. represents one of the largest chemicals and plastics industries in the world, we are well poised as a nation to capture a disproportionate share of this burgeoning market were it only for consistent policy.

Finally, and while certainly not popular, federal loan guarantees and grants in support of new refinery construction, as well as plant retrofits, are necessary signals to private investors that the U.S. government will continue to support commercialization of biomass-based products. Continuation of the public-private partnership model is crucial for ensuring that we take full advantage of the great opportunities presented by this industry.

This isn't a call for a change in the great American system. It's a call for more of that great American unity, common sense, and urgency that have always been in great abundance when we have done great things. It's a call for bi-partisan cooperation, now more than ever, to ensure we innovate here, build it here and harness the great potential borne from the high-growth, bio-based chemicals market.

One won't hear a lot of boo-hoos on Capitol Hill on behalf of bio-based products innovators waiting for an end to the policy logjam. But if a protracted period of politically-motivated analysis/paralysis over energy policy that facilitates displacement of the "whole barrel" is allowed to stunt or terminate our growth potential and our unique global opportunity right now for leadership, all of America loses. And that would be a crying shame.

Mr. Gatto founded Myriant's predecessor company in 2004 and formed Myriant in 2009. He has been involved in the biotechnology industry for over 19 years, founding a successful biofuels company and serving on numerous Presidential, Congressional and US DOE/USDA committees.

At BC International (now BP through its acquisition of Verenium), Mr. Gatto, in cooperation with Dr. Lonnie Ingram and the University of Florida, spearheaded the development of novel technology for the commercial production of ethanol from cellulose (patent number 5,000,000). Successful pilot operations led to licensing of the technology to two multinational companies.

In 2000 and 2002, Mr. Gatto was appointed by both the Clinton and Bush Administrations to the Biomass Research & Development Technical Advisory Committee. He was also appointed to a Biofuels Ad-hoc Committee chaired by Senator Dianne Feinstein and assisted in the drafting of key aspects of the Energy Policy Act of 2005.

Currently, Mr. Gatto is on the board of directors for BIO, the world's largest biotechnology organization, serving on the Industrial and Environmental (I&E) section governing board.

He earned an A.S. in Information Services and a B.S. in Marketing, both from Southern New Hampshire University.

The BioBusiness Alliance of Minnesota (BBAM) recently released its Bio-industrial processing roadmap for the advanced biofuels and biobased chemicals industry to provide information for investors, businesses and stakeholders.

According to BBAM's projections, direct and indirect employment in bioindustrial processing companies in Minnesota could total in excess of 13,000 by 2025, up from 2,000 last year. Bioindustrial processing companies in the state include Segetis, BioAmber, XL Terra, Reluceo, Cargill Industrial Oils and Cargill BioH, Butamax, Gevo, NatureWorks, CHS, BioCee, Starch Tech, Natur-tec, EarthClean, Cortec, Lonza, Agristrand Biocomposites, Entropy Solution, Butrolix, and Jet-E.

Other key points the organization wants to put out is existing infrastructure needed for integrated biorefinery development as well as sufficient agricultural and forest resources available for biobased chemicals and advanced biofuels feedstock.

The report includes specific policy recommendations developed to support the development of bioindustrial processing. Of course, a major factor in establishing this type of industry is to ensure availability of funding options for companies interested in "putting roots" in Minnesota.

Financing will be of critical importance to the industry. A full spectrum of investment is needed, from seed and angel funding to venture capital and long-term debt capital. 

Tactics include:
• Educating investors and financial institutions about the unique opportunity to develop the bioindustrial processing industry in this region, and
• Ensuring awareness, availability, and access to federal and state financial support to accelerate research and development through full-scale manufacturing

 BAM is also holding its Renewable Materials Summit in Fargo, North Dakota, on May 15 to talk more about biorefinery business opportunities.

US producers of bio-based products will be happy to know that President Obama signed a presidential memo yesterday that requires the federal government via the US Department of Agriculture's (USDA) BioPreferred Program to track and increase its purchases of products made from plants and other renewable agricultural materials.

The memorandum directs federal agencies to take decisive steps (such as small business assistance, increase biobased product categories, education and outreach) to dramatically increase the purchase of biobased products over the next two years. This Memorandum is expected to result in a 50% increase in the number of new products that are designated as biobased within a year.

According to the USDA, this memorandum will expedite job creation in rural part of the US. The USDA's BioPreferred program, which started in 1998, has two major initiatives: certify and award labels to qualifying biobased products, and designate categories of biobased products that are afforded preference by Federal agencies when making purchase decisions.

Here is a short video from USA Today on the news about President Obama's biobased products memo.

At Jim Lunt's bioplastic seminar held on Monday, BioPreferred Program's deputy manager Kate Lewis actually talked about the factors driving growth for biobased products including bioplastics. The BioPreferred program currently has about 9,000 individual products listed on its database under 64 categories that the USDA designated for preferred Federal procurement.

"Consumer preference are clamoring for these types of innovative, more sustainable products although they don't really know what they're asking for and what they're getting. Another reason this market is poised for explosive growth is corporate commitment in reducing greenhouses gases as well as reducing their carbon footprint. They're looking and starting to implement opportunities. Finally, international and national policies, mandates and regulations are supporting and contributing in the forward movement of biobased products." - Lewis

By the way, Lewis noted that federal agencies and the US Department of Defense actually spent about $500bn for their "stuff." She also noted that because of efforts, they know that there are about 25,000 biobased products that are being manufactured at this time and that 10,000 are listed in their database. About 3,100 manufacturers are also listed under the 64 categories of biobased products.

With regards to jobs, Lewis said that in the US, about 100,000 direct new jobs a year were created as a result of biobased product activities (development, science, technology, trade) throughout the value chain.

Another interesting point she noted in her presentation is that only about 1% of corn grown in the US are directly consumed by us and most go to animal feed. Also, 1/3 of every bushel of corn used for ethanol is returned back as animal feed called DDGs (dry distilled grain), which is a byproduct from ethanol production that are high in protein.

"Factors that really drive prices up for commodity products such as food staples is really the increase in demand for fuel and high oil prices. As long as oil stays at $90-100/bbl, that has ripple effects throughout different products and industries. The high costs of fertilizer, energy use for harvesting and delivery is impacting prices - it's not about the use of agriculture for biofuel." - Lewis.

Another big factors are increasing global population which leads to increase in demand for food, energy and other products where resources are not unlimited; uncontrollable weather such as drought, crop failures...

Meanwhile in Europe, the European Commission has actually launched early this month its own bioeconomy roadmap "Innovating for Sustainable Growth: a Bioeconomy for Europe." THe goal focuses on developing new technologies and processes for the bioeconomy; develop market and competitiveness in bioeconomy sectors; and push policymakers and stakeholders to work more closely together.

The Commission defined bioeconomy as an economy using biological resources from the land and sea, as well as waste, as inputs to food and feed, industrial and energy production. It also covers the use of bio-based processes for sustainable industries.

The EU bioeconomy reportedly already has sales of nearly €2 trillion and employs more than 22 million people, 9% of total employment in the EU. It includes agriculture, forestry, fisheries, food and pulp and paper production, as well as parts of chemical, biotechnological and energy industries. Each euro invested in EU-funded bioeconomy research and innovation is estimated to trigger €10 of value added in bioeconomy sectors by 2025, according to the Commission's report.

Still, some industry organizations note that the new strategy lacks specific actions to support biobased industries in Europe. While welcoming the EU bioeconomy strategy, the European Bioplastics said it hoped for more specific measures for bioplastics to be integrated into the strategy.

"The bioplastics industry is technologically well developed and can demonstrate a wide range of mature applications already today. What we need are strong measures to support the market development of bioplastics products."

Sorry for the post delay this week. Work deadlines and school are bad combination.

This week, most of the green social media talk is on solar panel manufacturer Solyndra and it's bankruptcy filing. Solyndra was one of the biggest recipients of US government funding (around $527m to be exact according to a NY Times article). I remembered in 2008-2009, the company was also a darling of the venture capital world.

The debate these days is whether government funding, loans and subsidies are really that helpful - both for taxpayers and for technology start-ups, especially when US lawmakers are talking about cutting spending.

According to the NY Times, two other US solar companies, American solar companies, Evergreen Solar and SpectraWatt, also sought bankruptcy protection in August. All of the companies blamed stiff competition from cheaper Chinese solar panel manufacturers as well as ongoing bad economy. When it comes to the business of chemistry, I like Cleantech Chemistry blog's explanation on how Solyndra's product economics failed driven by ramped up of polysilicon and solar modules capacity around the world.

Regarding DOE financing, an interesting perspective was posted by Greentech Media on Solydra's share of the total DOE solar funding, which the blog said was 3.4% of the DOE solar portfolio.

Now, the green blog has been putting out news lately of further US grant and loan announcements on the development and commercialization of carbon capture technologies, advanced biofuel and renewable chemicals, and also in solar technologies. You would think that the Solyndra story could have paused these fundings? Think again.

Just last week, the Department of Energy (DOE) announced funding up to $12m in three-small scale projects from LanzaTech, Virent Energy Systems and Research Triangle Institute, which aims to accelerate development of drop-in biofuels and biobased chemicals.

Just for background here, LanzaTech will receive up to $4m to convert biomass-based ethanol into jet fuel; Virent will receive up to $4m to convert biomass into oxygenated chemical intermediates; and Research Triangle Institute will receive up to $4m to integrate thermochemical and hydroprocessing technologies that will help produce biomass-based gasoline and diesel.

Also last week, the DOE plans to plunk $41m to 16 projects that will develop post-combustion technologies for carbon capture from coal-fired power plants within a span of 3 years. Some of the companies that capture the blog's attention here were Novozymes, GE Global Research, and W.R. Grace.

Archer Daniels Midland (ADM), a big recipient of a 2009 carbon capture DOE funding ($141m to be exact), recently broke ground on the construction of the US' first large scale industrial CCS facility in Decatur, Illinois. The facility is expected to capture and store 1m tons/year of carbon dioxide coming from cron-based ethanol biofuel processing from nearby plants. The capture and storage is expected to begin in late summer 2013.

Some of the renewable chemical companies that I've talked to about CCS noted that it is actually better for the DOE to just fund development of the use of waste CO2 and convert it into something useful (and profitable) than have it stored on the ground.

Back to recent government funding announcements,  the blog posted last week a biofuel development and commercialization investment of up to $510m coming from the DOE, US Department of Agriculture (USDA) and the US Navy. The agencies plan to collaborate with private firms that will match the investments to construct or retrofit several drop-in biofuel plants and refineries.

And finally this first week of September, the DOE are awarding more than $145m in 69 solar projects. The projects are expected to improve materials, manufacturing processes and supply chains for a wide range of photovoltaic solar cells and solar energy system components. Dow Chemical, GE, and Owens Corning are the recipients that stood out for the blog.

I've actually asked some of the companies that I've covered in the green chemicals/biofuel field regarding the necessity of government grants/loans. All agree that they are helpful especially when it comes to advancing new technologies but to a point. All also agree that a business cannot and must not rely on these grants/loans and especially subsidies.

But then the field of renewable chemicals could be a little different compared to cleantech energy and biofuels. Come to think of it, renewable chemicals do not really get as much funding as renewable energy/biofuel funding anyway.

I know the blog is late putting out this news but it's worthwhile to mention some of the first companies and products that were included in the US Department of Agriculture's (USDA) newly-certified biobased products.

If readers recalled, the USDA put out an announcement in January about their new voluntary product certification and labeling program for qualifying biobased products (and chemicals). The label identifies biobased products as those composed wholly or significantly of biological ingredients coming from renewable plant, animal, marine or forestry materials and will have a prescribed percentage amount of biobased content certified to meet the USDA standards.

Eleven companies received the first BioPreferred label approval with products including hand soaps and hand sanitizers, plant-based plastic food packaging used to package fresh food, an array of biobased cleaning products, engine oils and lubricants, as well as biobased fiber spun into carpet and clothes.

Companies include: Nutek Green, Seventh Generation, Betco Corp., Clear Lam Packaging, DuPont, ElastiKote, Green Earth Technologies, National Industries for the Blind Agencies, NatureWorks, Rochester Midland Corporation, and Bio-Lub Canada.

The USDA estimates that there are 20,000 biobased products currently being manufactured in the United States.

This week is going to be tough given that a) it is a short week, b)I have two feature articles that I'm working on with deadline next week, c) I have two school exams this week.

I am also preparing for next week's Green Chemistry Panel Discussion on March 3, which I will be co-moderating. Before my brain shuts down from overloaded information, let me post this "better-late-than-never" videos that I took from the recent American Cleaning Institute (ACI) meeting.

The first video is from my interview with Seventh Generation's Martin Wolf, director of product and environmental technology. The company's long-term goal is to ultimately use100% renewable-based chemicals and materials for its products. But of course, that is easier said than done especially when it comes to laundry detergents. Seventh Generation is using 100% renewable materials for its spray cleaners (which are easier to formulate as their ingredients are not as complex).

Wolf actually noted that the company does not have any problem using petroleum-based chemicals except for the fact that petroleum is being used unsustainably in the fuel industry. 

"If they are not burned, there'll be plenty of supply of these materials," he said.

For renewable-based surfactants, Wolf is giving credits to companies such as Cognis, Clariant, Croda, AkzoNobel, Evonik, etc., who are continuously developing these alternatives.

"It is becoming easier for us to increase the use of chemicals with renewable content with the same performance, properties and at a right price," said Wolf.

Seventh Generation also credits itself as well as consumer products companies who are forcing the chemical supply chain to rethink their profitability strategy and put sustainability in this equation. Wolf cited an example where eight years ago, the company is looking for palm-based surfactants that do not contain certain levels of 1,4 dioxane, a byproduct that can form in trace or miniscule amounts within sulfation process of alcohol ethoxylates.

"There were only two companies that met our specification - one in India and the other in the US. Today we have our choice of half a dozen. Our success has forced the supply chain to take a harder look at what they're doing and to increase the sustainability and reduce the hazardous ingredients of their products,"  said Wolf.

Seventh Generation said it is still a challenge for them to find availability of renewable-based surfactants. The company currently does not use phosphates, chlorine, dyes, optical brighteners and chemicals with VOCs in their cleaning products.

More information from my video interview below:

By the way, here is also an interview I did talking to American Cleaning Institute's VP of communications Brian Sansoni. The organization has been very active last year in Congress on their stand about the EPA's Toxic Substances Control Act (TSCA) and California's Green Chemistry Initiative, among other pending government/state rules and regulations that will affect their industry. You can read more about it on ICB's recent interview article with ACI president Ernie Rosenberg.

Before I start posting news from BASF, Lanxess, Segetis, Elevance, OPXBio, Myriant, Rivertop Renewables (and the list goes on and on...), here's an interesting development from GE Appliances & Lighting, which became the first appliance manufacturer to partner with the US Environmental Protection Agency (EPA) in their Responsible Appliance Disposal (RAD) program.

According to GE, 9m refrigerators are disposed in the US annually and only a fraction has the insulating foam in their walls and doors recycled. Under the RAD Program, GE will supply used appliance volume to the Appliance Recycling Centers of America (ARCA), where the organization will also recover 95% of the insulating foam in refrigerators.

GE and ARCA plans to vastly improve appliance recycling and refrigerator foam recovery in the US given that the the US appliance recycling industry is said to be very fragmented. ARCA expects to open and start its regional recycling center in Pennsylvania in the first quarter of 2011.

In terms of recycling and foam recovery, ARCA will use technology from UNTHA Recycling Technology (URT). The company's recycling system includes capability to automatically capture blowing agents such as chorofluorocarbons (CFCs), hydrochlorofluorocarbons (HCFCs), hydrofluorocarbons (HFCs), and cyclopentane from the insulating foam in refrigerators and freezers.

"The potential of this technology is tremendous," said Brian Conners, President and COO of ARCA Advanced Processing. "If the foam from the 9 million refrigerators disposed of annually in the U.S. were processed through this recycling technology, the greenhouse gas emissions avoided would be equivalent to the annual CO2-e emissions of more than 2.4 million cars on U.S. roads."

It's a happy week this week for all biobased chems and products manufacturers as the US Department of Agriculture (USDA) announced the launched of a new voluntary product certification and labeling program for qualifying biobased products (and chemicals).

The new label will clearly identify biobased products for all buyers and consumers and not just federal agencies anymore. The USDA identifies biobased products as those composed wholly or significantly of biological ingredients coming from renewable plant, animal, marine or forestry materials. The label will have a prescribed percentage amount of biobased content certified to meet the USDA standards.

In a media briefing held last Wednesday by the USDA Secretary Kathleen Merrigan, the agency noted that there are already 5,100 designated biobased products identified by the USDA for preferred purchasing by US federal agencies.

The USDA estimates that there are 20,000 biobased products currently being manufactured in the US. The USDA also identified 50 product categories for the BioPreferred Federal procurement program including cafeteria ware, personal and institutional cleaning products, construction products, lubricants, greases, etc.

With the announcement, the BioPreferred program now has two parts: the biobased product procurement preference program for federal agencies, and the new voluntary labeling initiative for broad scale marketing of biobased products. By the way, the minimum threshold for biobased content is 25% for finished biobased products and for intermediate ingredients or feedstock not within the designated USDA categories.

There were actually a lot of interesting comments on the Federal Register on how this labeling will work and should work. Read on if you have the time. As to who can apply for the certification and product labeling, any manufacturers or distributors (vendors) of biobased products are welcomed.

In a Roundtable panel discussion yesterday held by the BIO organization, I asked the panel (which included NatureWorks, Metabolix and DuPont) about fees, NatureWorks noted that the USDA itself will not impose any fees for the label but the testing of the bio-based product (on how much biobased content it will have) via third party firms will have to be shouldered by applicants.

All three companies noted that the labeling is not yet perfect but agreed this is a first step towards having a common language for biobased products within the consumer and even industrial level. 

"The labeling provides a common authoritative reference of bio-based content" - NatureWorks

"The labeling substantiated our claims. It is important to consumers and manufacturers to verify that we are marketing our products correctly." - Metabolix

"Most of our biobased products are further back in the value chain. The labeling creates awareness from businesses to consumers of having biobased content in their end products." - DuPont

Here are some other formal comments coming from various industries and companies:

BIO
DuPont
American Soybean Association
Rivertop Renewables -

"We applaud the USDA's recent ruling to initiate the volunteer labeling program for biobased products. I'm pleased to see a decade long effort by the USDA and leaders in the renewable chemical industry culminate in this enhancement of the federal BioPreferred program. These labels will help educate consumers and spur even more demand for safer, cleaner, and more sustainable everyday products such as detergents, cleaners, and plastics." -Jim Stoppert, CEO Rivertop Renewables.

I was too sick last week to post anything but I'm recovering enough now to hopefully be able to post last week's news, maybe one interview, and then I'm off for some Black Friday shopping to support the economy and the chemical industry (I will do my best...)

LanzaTech sent me this news on November 17 about their project with Pacific Northwest National Laboratory (PNNL) to develop drop-in jet fuel using waste gas-based 2,3 butanediol (2,3-BD) as feedstock.

Now I've been confused with butanediols since I always encountered 1,4 butanediol (BDO) in previous posts (such as Genomatica's project) but I guess 2,3 BD is quite different and I have not really gotten much market information on this particular building block except a couple of research studies. I am guessing that there is not really a commercial market for 2,3 BD or if there is, it's a very small one although anybody reading this, pls. let me know if I'm wrong.

I have not yet spoken to LanzaTech but I'm planning to do it soon. According to various bits and pieces found on the web, 2,3-BD is typically produced by a variety of microorganism in an anaerobic fermentation of glucose. I have not yet found any mention that 2,3-BD can be produced via petrochemical processing.

Like 1,4 BDO, 2,3-butanediol also known as 2,3-butylene glycol can be used as a chemical building block to produce solvents, polymers, resins and fuel. With a heating value of 27,200 Joules/gram, BD is said to be favorably comparable to ethanol (29,100 J/g) and methanol (22,100 J/g) for use as a liquid fuel and fuel additive.

This is what LanzaTech and PNNL are looking to develop under the sanction of the US Department of Energy (DOE). The first phase of the development project is expected to be done within a year with the DOE funding and LanzaTech contributing to it. By how much is another question to ask LanzaTech. PNNL by the way, is a national laboratory of the DOE and has been managed by Ohio-based Battelle.

For some other fun facts about 2,3-BD, dehydration of this chemical leads to methyl ethyl ketone (MEK) production and then further dehydration yields 1,3 butanediene which is the starting material for synthetic rubber and as an important monomer for the polymer industry.

I've been seeing a lot of investments this year on lithium-related production capacity coming from the chemical industry especially here in the US.

Today, BASF broke ground on a $50+ million facility in Elyria, Ohio, to produce Nickel-Cobalt-Manganese (NCM) cathode materials for lithium-ion batteries that can power hybrid and full-electric vehicles. The investment has the help of $24.6 million grant from the Department of Energy (DOE) under the American Recovery and Reinvestment Act.

BASF said it expects the plant to be the most advanced cathode materials production plant in North America when it is fully operational in 2012.

In October 5, Rockwood initiated the expansion of its battery-grade lithium hydroxide production operations in Kings Mountain, North Carolina. The plant is being built at the existing Chemetall Foote Kings Mountain production site, which currently produces other lithium salts and lithium metal for primary batteries.

The project is expected to be complete in 2012. This is also funded in part by a $28.4 million grant from the DOE.

Rockwood's Chemetall business is also currently expanding its lithium carbonate production operation in Silver Peak, Nevada, funded partly by a $28.4m grant from the DOE. This project is expected to be completed in 2013.

On June 21, Dow Chemical's Dow Kokam business broke ground for a new lithium ion batteries production facility in Midland, Michigan. The first phase of construction, supported by a $161m DOE grant, will produce batteries with target capacity of 600m watt hours. Total battery capacity of 1.2bn watt hours is expected after completion of the facility.

First battery batch produced are expected in early 2012. Dow Kokam, by the way, is owned by The Dow Chemical Company, TK Advanced Battery LLC and Groupe Industriel Marcel Dassault.

German chemical company Sud-Chemie invested this year EUR60 million ($82.6m) in lithium iron phosphate (LFP) production in Candiac, Quebec, a site owned by its subsidiary Phostech Lithium.

Commercial production for series delivery will start in 2012 to reach a rate of 2,500 tons per year. Sud-Chemie said this volume will allow the production of approximately 50,000 all-electric automobiles or, alternatively, up to 500,000 vehicles with hybrid drive per year.

Because of high demand, Süd-Chemie is also planning to expanding its production capacity for LFP at its site in Moosburg, Germany. The company is already currently manufacturing up to 300 tons/year of LFP at this site.

By the way, Ford said it has selected Compact Power Inc. (CPI), a wholly owned subsidiary of LG Chem, this year as the supplier of lithium-ion battery packs for the 2011 Ford Focus Electric for the U.S. market

CPI, based in Troy, Mich., will begin battery pack assembly for the Focus Electric next year and is finalizing production site selection in the U.S. The lithium-ion cells initially will be manufactured in Korea by CPI parent company LG Chem. LG Chem and CPI will be localizing cell production at their new site in Holland, Michigan.