A conversation with Brian Appel of Changing World Technologies
In 2003, Changing World Technologies made headlines in the United States and abroad with the announcement that it would be able to make oil out of just about anything. The company had been running a plant that processed seven tonnes of turkey offal per day into oil at a cost of around $15 per barrel. After a larger plant that processes 238 tonnes of turkey offal per day did not go into operation on time (due - the company says - to construction errors, not problems in the technology itself), skeptics began to wonder whether this was another fly-by-night operation. Now, at the end of 2004, all systems are go, with the plant running at 80% capacity. Craig Morris spoke with Brian Appel, the company's CEO, for Telepolis.
Mr. Appel, your company is drawing great interest both in the US and elsewhere for its promise to turn waste products into biodiesel at competitive prices. If I understood your company's spokesperson correctly, you just returned from Canada yesterday, where you met with US President George Bush and Canada's Prime Minister Paul Martin.
Brian Appel: I was invited by the Prime Minister.
So it seems that your company is the Real McCoy and not just another fly-by-night operation that is going to offer us free energy.
Brian Appel: We have put over $ 90 million into this company, and the reason other technologies are considered fly-by-night operations is that they do everything at the lab scale and are not able to take it to the next level. It takes more than just researchers; you need to look at everything from logistics to financing.
We hooked up with a big food company that was interested in using all the waste from the food chain without putting it back into animal feed. If you want to make the chain more sustainable, then you need do things like this. When we moved from our 7-ton plant in Philadelphia to the 250-ton plant in Carthage, Missouri, we had to redesign everything.
Look at the only other success story in biofuels in the US: ethanol. Some say it's not even a success story because without the subsidies it would never work. Ethanol is an additive for gasoline, while we produce a synthetic diesel. Ethanol also has a 30-year head start. Our plant in Carthage, Missouri is the first commercial one of its kind ever. And we are still tweaking certain parts of the design to enhance performance. I'm sure that the design of the next few plants to be built will be slightly different.
Where will these next plants be? Will they also process turkey offal?
Brian Appel: More than likely, they will process beef. The next plant will probably be in the British Isles. Remember that the British Isles received much of the blame for spreading BSE. There are now much tighter restrictions on the input side of the food chain there. Europe now protects its food chains, so we will get paid to "dispose of" the remains of cattle. In the US, we would not be paid because farmers can still take unused parts to a render, who will put it back into animal feed.
And then there is the output side. As you know, there is an EU directive stating that more biofuel has to be produced. In the US, the subsidies are basically for soybean and corn.
In addition, we are also able to sell a co-product as fertilizer because the United States is starting to promote organic farming. In Europe, we wouldn't get as much for this fertilizer because almost everything you do over there is organic.
Oh, we don't have that much organic here.
Brian Appel: Compared to what we do in the States, European farming is organic. Just about the whole rest of the world is farming normally compared to what we are doing. So here, I'm getting a premium because there's a movement over here to buy organic. If I go to Europe and sell this fertilizer, I have to drop my expectations to the level of normal fertilizer.
Granted, without the proper management - logistics, financing, etc. - your company would not be successful. But I think most people are interested in seeing that the technology behind it all really works. When I first heard about what you were doing a few years ago, I also rolled my eyes when I read that you wanted to speed up the process of creating oil down to 15 or 30 minutes.
Brian Appel: It takes about 15 or 20 minutes to run the process in the main reactor. But you are flattering me. We don't think our processes are that complicated.
So why didn't anyone think of this before?
Brian Appel: We had such an abundance of light crude oil. You used to be able to stick a straw in the ground in Texas - and you still can in Saudi Arabia - and light crude oil just comes bubbling out. But a lot of the light stuff has been used up, so we're dealing with more heavy oil now.
Second, we have now had 150 years to see what the impact of the use of all of this fossil oil is going to be. And since the sixties and seventies, there has been a growing environmental movement. In the US, Rachel Carson wrote Silent Spring, you had the beginnings of the Green movement in Europe, etc. So after the initial denial, we have begun to think about how to become more sustainable in the past 40 or 50 years and look for solutions for waste.
So people are just now looking for technologies like yours?
Brian Appel: Sure, but look back at some of the inventions that were made 100 years ago, especially in Germany. There was some amazing stuff. Ahead of its time.
One prime example being the fuel cell, whose basic design was developed all the way back in 1838.
Brian Appel: Right. But the time was not right. People have been using pyrolysis for some time, but that produces a very nasty by-product, and the oil companies complain about the quality of the oil produced by pyralysis and won't buy it. And electricity companies won't buy it because of the pollutants.
So we decided to do things backwards and start with the requirements. What does it take to meet the specifications for engines? Then, we basically added refinement steps after our initial stage. Refiners do the same thing: they take crude, desalt it, separate the light oil out, etc. So you can't do this in one or two steps.
You're talking about motor engines, and most people think about cars and trucks when they hear that. But your company sells most of its oil to a power company. Is there some difference between the engine that produces electricity in that plant and the basic diesel motor in a car? From what you just said, it sounds to me like you could produce for almost any specification.
Brian Appel: Power companies in the US have renewables portfolio requirements. So the utilities have to produce X amount of power from renewable sources. Over here, you go 1.75 cent tax credit per kilowatt-hour of green power. And quite simply, the company that helped us fund the pilot project simply needed more electricity in its renewables portfolio.
The main reason I'm asking about why the Biodiesel you produce is mostly used to generate electricity is because of a common misconception. Many people are calling for more solar power and wind power because we are running out of oil. But they are missing a crucial point: with wind power, we make electricity; with solar, electricity and heat. When oil starts to become scarce, we are going to mostly need motive power. That is why the potential of biomass, and hence of your company, is so crucial.
Brian Appel: We are working with the Big Three. Right now, we are working with DaimlerChrysler to develop a motor fuel. But we are also working to clean up the sector of heavy fuels, which causes most of the pollution. And there is one advantage to starting with stationary motors, like the ones used to generate electricity: you can easily see what the long-term effects of emissions are, what the wear is on seals, fuel line filters, etc.
Right now, we're facing a situation where engines will have to be tailored to these new biofuels. For instance, if you use biodiesel in a cold area, you might find that your fuel lines clog up because the fuel has congealed. People think complain that the fuel is bad, but the fuel's not bad - you just have to know how to use it. My fear is that the excitement about using biofuels might backfire. So if we use a blend in a stationary engine, we can better study what the long-term effects will be.
I have been working intensively with DESC, the Defense Energy Support Center, which is the biggest buyer of fuels in the world - that's the US military. We'd like to have the Post Office running on biofuels and get as many people as possible involved. And there are lots of other companies like us working on synthetic hydrocarbons that can serve as a transition to take us to the next level, beyond internal combustion engines, which is what I think a lot of people are shooting for.
And what is the next level, fuel cells?
Brian Appel: I don't think they're possible personally. Right now, the main supply of hydrogen comes from oil and coal, so there's a lot of hype.
Here's what we care about: the company's stated mission is to clean up this waste, produce a clean fuel, and minimized global warming because much less fuel would have to be dug up from beneath the ground. If we can do that, will have better quality of life, cleaner air, and our way of life will be more sustainable.