Bloomberg News

U.S. ‘Losing Momentum’ in Biofuels Makes Novozymes Target Brazil

February 21, 2012

Feb. 16 (Bloomberg) -- Novozymes A/S, the world’s biggest maker of enzymes for biofuels, is focusing its expansion efforts in Europe, China and Brazil and isn’t pursuing new projects in the U.S. because of the lack of political support.

“The policy signals sent to the market are not consistent” in the U.S., said Steen Riisgaard, chief executive officer the Copenhagen-based company, in an interview at Bloomberg’s headquarters in New York. “The U.S. is losing momentum now compared to the rest of the world. The momentum is no longer here. It’s in China and Brazil.”

The comments add to concern expressed by Vestas Wind Systems A/S, the world’s biggest wind turbine maker, that President Barack Obama’s administration isn’t doing enough to support renewable energy technologies. Vestas says it may fire 1,600 workers this year in the U.S. if a tax credit for wind energy developers isn’t extended.

A U.S. tax credit that provided refiners with 45 cents for every gallon of ethanol blended into gasoline expired Dec. 31. A 2007 law requires the U.S. to consume 15 billion gallons (57 billion liters) of ethanol by 2015 and 36 billion gallons of renewable fuels by 2022.

The U.S. consumed 12.6 billion gallons of ethanol last year, compared with 5 billion gallons in Brazil, 2.7 billion in the European Union and 590 million gallons in China, according to Bloomberg New Energy Finance.

Riisgaard said the expired U.S. tax credit “helped the oil industry more than the blenders.”

Novozymes is opening a $200 million plant in Nebraska this year and has no other plans to expand in the U.S. until the nation’s energy policy becomes more certain, Riisgaard said. It’s supplying enzymes to Italy’s first commercial second- generation ethanol plant and is seeking additional opportunities in Asia and South America.

--Editors: Will Wade, Reed Landberg

To contact the reporter on this story: Justin Doom in New York at jdoom1@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net


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