Business

Follow-Up File: E-Fuel takes alternative pathway

Name: Tom Quinn

Job: Co-founder

Business: E-Fuel Corp.

What they said then:

In January 2010, the founders of E-Fuel Corp. told The Tribune’s Follow-Up File they were preparing to fill “thousands of orders” from customers on three continents for the E-Fuel 100 MicroFueler.

The MicroFueler converts sugar into ethanol fuel. The self-contained units combine fuel conversion techniques — the specialty of Paso Robles inventor Floyd Butterfield — and wireless computer technology — the domain of entrepreneur Tom Quinn and his Silicon Valley team.

“We are currently raising the financing required to expand production so that we can build hundreds of machines per month,” Butterfield said in August.

The small Paso Robles plant won early orders from wineries and other alcohol manufacturers seeking to convert waste to fuel for trucks and generators. The state of California announced a pilot program for its fleets.

E-Fuel later placed MicroFuelers at universities in Louisiana, Kentucky, Ireland, Vienna, Canada, Japan and Thailand.

“We think it’s a multibillion-dollar market,” Quinn said. “Students collect and process waste as part of the educational system.”

Hoping to win funding by General Electric or another, the company entered the GE Ecomagination Challenge, a public contest for energy innovators.

What he says now:

The MicroFueler ranked in the top 20 in General Electric’s Ecomagination Challenge. It didn’t win GE funding, but it did attract some attention that set E-Fuel on a new road.

“We started to get a lot of calls from big corporations,” Quinn said. “The federal government is giving enormous amounts of grants and tax incentives for those who are making electricity. These companies are tapping into this.”

And as MicroFuelers became available for delivery, the state of California and small businesses couldn’t pay.

“We’re not in a position to finance,” Quinn said. “Unfortunately, you go where the money is.”

At the request of “green teams” at large corporations, E-Fuel developed a “rectangular box” about the size of a parking space, Quinn said. With the equivalent of a dozen MicroFuelers and a reactor that turns the waste into sugar, it then produces electricity.

It costs just under $1 million. A MicroFueler with a fermentation tank retails for $13,000.

More importantly for E-Fuel, these big corporations have cash now.

Those with more than 1,000 employees generate tons of food, paper and other organic waste and pay large “tipping fees” to have trash hauled away.

It’s also fashionable for Fortune 500 and other companies to pursue certification through the Leadership in Energy and Environmental Design (LEED) program. Such measures are expensive and require staff dedicated to completing paperwork to prove compliance.

Reducing contributions to landfills and contributing electricity to the grid can score points toward LEED eligibility and tax credits.

So far, none of E-Fuel’s big systems have been installed. Quinn expects to place a few in coming weeks, while the customers pursue city permits for installation.

Universities, both domestic and overseas continue to be a promising market, fueled by grants earmarked for alternative energy.

An additional revenue stream for E-Fuel has been selling its digital control systems to midsized ethanol plants in the Midwest.

With about 14 employees in Paso, plus engineers in the Bay Area, Quinn said about 50 MicroFuelers are in use.

“We had to shift gears in this market,” Quinn said. “The small-business people don’t have the capital to do these things. The large system is the way it has to go. When we first started business we didn’t envision this.”

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