CONTENT
Business Background
Fossil fuels have many drawbacks, and biofuel ethanol is currently one of the most promising biofuels. First-generation fuel ethanol is produced from starch- or sugar-based materials, such as corn, sugarcane, cassava, and beets, through fermentation. This is the primary method for producing biofuel ethanol today. However, it poses various issues, such as threats to food security and greenhouse gas emissions comparable to those of fossil fuels. In contrast, second-generation fuel ethanol is derived from lignocellulosic materials, such as agricultural waste, which does not entail the typical problems of "competing with food" or "competing for land." This approach is beneficial for promoting economic development in rural agricultural areas, improving the ecological environment, and has numerous advantages, including the reduction of greenhouse gas emissions. Therefore, the development of second-generation biofuel ethanol has become a focal point of research.
Fuel ethanol relies on the fermentation of Saccharomyces cerevisiae (brewing yeast) for its production. The use of traditional starch-based raw materials for fuel ethanol production raises the issue of "competing with food" and "competing for land." Replacing these with lignocellulosic materials holds the promise of addressing these concerns. After the pretreatment of lignocellulosic materials, they contain not only glucose but also a rich composition of xylose. However, brewing yeast cannot naturally utilize xylose, leading to waste of raw materials. The traditional approach to endow brewing yeast with xylose utilization capability involves the introduction of xylose isomerase metabolic pathways and the continuous passage of yeast strains on xylose carbon source media (domestication). This process is time-consuming and labor-intensive, and the yeast strain phenotypes are often unstable. This project is based on the NFS1I492N gene mutation identified through comparative genomics research, combined with the integration of multiple copies of the xylose isomerase expression gene xylA. The aim is to rationally construct a brewing yeast strain that can rapidly utilize xylose.Fuel ethanol relies on the fermentation of Saccharomyces cerevisiae (brewing yeast) for its production. The use of traditional starch-based raw materials for fuel ethanol production raises the issue of "competing with food" and "competing for land." Replacing these with lignocellulosic materials holds the promise of addressing these concerns. After the pretreatment of lignocellulosic materials, they contain not only glucose but also a rich composition of xylose. However, brewing yeast cannot naturally utilize xylose, leading to waste of raw materials. The traditional approach to endow brewing yeast with xylose utilization capability involves the introduction of xylose isomerase metabolic pathways 1 and the continuous passage of yeast strains on xylose carbon source media (domestication). This process is time-consuming and labor-intensive, and the yeast strain phenotypes are often unstable. This project is based on the NFS1I492N gene mutation identified through comparative genomics research, combined with the integration of multiple copies of the xylose isomerase expression gene xylA. The aim is to rationally construct a brewing yeast strain that can rapidly utilize xylose.
Market Analysis
A. Lignocellulose contains a lot of xylose, but ethanol fermenting yeast cannot effectively use xylose, wasting the original material, causing a high budget. Our product is ethanol fermenting yeast that can rapidly use xylose, raising the efficiency of turning lignocellulose into ethanol. It effectively makes up for the flaws in making ethanol from lignocellulose.
B. The global demand for environmentally friendly materials has increased dramatically in recent years due to the depletion of natural resources that cannot be replenished. The practitioners proposed circular and bio-economy as substitute economic production frameworks to promote long-term growth and development (Awasthi et al., 2022; Khan and Ali, 2022). The global need for new energy resources has increased exponentially over the last few years. The overuse of non-renewable fossil fuels has caused a dramatic decrease in amounts still left out in nature and increased greenhouse gas emissions. Although fossil fuels have satisfied our needs for energy resources, however, it are quickly running out, causing future problems. This is where ethanol fuel comes in. Ethanol fuel is a clean and renewable energy. However, its production today wastes a lot of food, so production from organic waste is going to be a giant leap in both the technical and clean energy fields. https://www.sciencedirect.com/science/article/abs/pii/S0959652623046942
C. In recent years, the extraction of biofuels from agricultural waste has seen significant growth to meet global energy demands. It is projected that between 2021 and 2026, global energy demand will increase by 11 million gallons. According to a recent study, the annual production of agricultural waste worldwide is approximately 1 billion tons, highlighting the substantial amount of agricultural waste that can be converted into a diverse array of valuable products across various industrial sectors. Advancements in agricultural waste utilization are paving the way for renewable energy production. Agricultural waste can be easily converted into ethanol biofuel through three main steps: pretreatment, hydrolysis, and fermentation. Furthermore, agricultural waste has the potential to replace petroleum products. https://www.sciencedirect.com/science/article/abs/pii/S0959652623046942
D. Cellulose ethanol market prospects: Being a second-generation biofuel, cellulose ethanol has a bright future, receiving support from government policies and investors. According to data released in the "Blue Book on the Development of China's Oil Distribution Industry (2023-2024)," the apparent expenditure on gasoline in China for 2023 reached 149 million tons. Since 2002, China has been promoting the use of ethanol gasoline. Based on a fuel ethanol blending ratio of 10%, the market demand for fuel ethanol is approximately 15 million tons. With a price of 6,000 RMB per ton, the market scale amounts to as much as 90 billion RMB. https://www.cppei.org.cn/zcfg/detail.asp?categoryId=1811&articleId=225292 https://mp.weixin.qq.com/s/dxEeL5QqokMInVuHYHSW1A
Operation and Marketing Planning
3.1 Competitive Analysis
Other companies today that are also investing in second-generation ethanol include companies such as Zymo Biotech from Wuhan, Sunliquid by Clariant, Novozymes, etc. Sunliquid publicized its production process, using carbohydrates from agricultural residues to create ethanol. What is different about our process is that our yeast turns xylose into xylulose, which is easier to ferment into ethanol, while their process uses carbohydrates directly. This process utilizes what their production process will put to waste, making ethanol out of xylose. Novozymes also publicized parts of their production process and future plans. They are also using corn kernels for the production of ethanol. However, we can still utilize more parts of the agricultural waste in production. Their plans include using waste paper and cardboard to produce ethanol. This is another great area that we are planning to explore further.
3.2 PESTLE Analysis
Political:
According to <Implementation Plan on Expanding the Production of Ethanol for Biofuel and 3 Promoting the Use of Ethanol Gasoline for Automobiles>, the government is encouraging the development of our project.
Economical:
The global economic recovery is driving an increase in energy demand, with a positive outlook for economic growth and a rebound in energy consumption, which is beneficial for the growth of the biofuel market.
Social:
The demand for clean energy is becoming increasingly strong in today's society. By using brewing yeast and xylose cellulose to produce ethanol, efficiently and cost effectively solving human problem. This has a positive impact on our business plan.
Technological:
Advances in synthetic biology and gene editing technology have provided technical support for the development of highly efficient yeast strains such as Metabolic pathway modification, Promoter optimization, Gene knockout and over expression, Multiplasmid cotransformation, Metabolic pathway remodeling and Cell factory construction.
Legal:
Environmental regulations and fuel standards in various countries impose requirements on the production and application of biofuels. The People's Republic of China Environmental Protection Standards include: F141 Biomass Fuel, F240 Bio-liquid Fuel, and F242 Alcohol Fuel, including Bioethanol Fuel. https://www.mee.gov.cn/ywgz/fgbz/bz/bzwb/other/xxbz/200912/t20091230_183635.shtml https://www.mee.gov.cn/ywgz/fgbz/bz/bzwb/other/xxbz/200912/W020091230522334710102.pdf The "Guidelines for the Selection of Processes and Equipment for the Production of Biomass Fuel Ethanol" specifies the criteria, principles, and basic requirements for selecting processes and equipment for the production units of raw material pretreatment, mash preparation, distillation dehydration, and waste liquid treatment of biomass fuel ethanol. https://openstd.samr.gov.cn/bzgk/gb/newGbInfo?hcno=D0FE4BE127AAC4ACC8BC0C0A36218D8D Legal factor reminds us that we should strictly abide by the requirements of laws and regulations and avoid legal punishment.
Environmental:
With global climate change, the intensification of Nino phenomenon, and rising sea levels, people's attention to the Earth's climate is increasing. In recent years, humanity has also been actively addressing related issues, and countries have been making their own efforts to share in the Paris Agreement. So, by modifying brewing yeast and using lignocellulose as raw material to produce ethanol, we meet the aspirations of all humanity for global climate and environmental improvement. Our principles are also cleaner, more efficient, and cost- effective, making a positive contribution to sustainable human development.
3.3 Porter's five force
3.4 SWOT Analysis
Our Product- Strategy formation
4.1 Product
Product Description We have rationally developed a fast xylose-utilizing yeast strain based on the NFS1I492N mutation. This strain will convert xylose, which has low utilization rates and is easily available at a low price in the ethanol industry, into xylulose, participating in ethanol conversion and creating an ethanol manufacturing industry centered around xylose as a low- cost raw material.
4.2 Price
Through interviews with staff from relevant companies, we received valuable advice. After discussions, we have decided to implement a Hybrid Revenue Model, which combines a fixed upfront fee (prepayment) with a variable fee structure based on profit sharing. Initially, we will collect a portion of the prepayment and then, on a regular basis, collect a percentage of profits from second-generation ethanol producers.