Greentech Media

Coskata has begun producing small amounts of ethanol at a pilot plant at its offices in Warrenville, Ill., and has started building its 40,000-gallon-per-year demonstration plant, Chief Marketing Officer Wes Bolsen told Greentech Media this week.

The Khosla Ventures-backed startup made a splash in January when it announced a partnership with General Motors and claimed it could make ethanol for less than $1 per gallon (see With GM Deal in Hand, Coskata Promises $1 Ethanol).

GM had originally hoped the pilot plant, which is only "producing at a liters and gallons kind of scale," would be completed before the startup came out of stealth mode in January, Richard Tobey, vice president of research and development and engineering, said at the time.

While the plant opened a few weeks late, it has been operating for a couple of months, Bolsen said. The plant has helped increase the efficiency of Coskata’s technology, and its organisms can produce ethanol twice as efficiently as they could in January, he said.

The bugs can produce 100 times as much ethanol from a dry ton of material as they could in 2006, when the team began working with them, he said, adding that the efficiency levels are six to nine months ahead of schedule.

The next step is the demonstration plant, which Coskata expects to open at the end of this year or the beginning of next year (see Coskata Bucks Tradition).

The company is expected to announce the location of the plant, as well as its partners, later this month, and Bolsen said Coskata plans to begin producing ethanol from nonfood sources at the plant next year.

The company previously said it would deliver fuel to GM from the 40,000-gallon-per-year facility in the fourth quarter of this year.

"There’s no real hurry," Bolsen said.

Aside from GM, which will use Coskata’s fuel to test vehicles at its Milford Proving Grounds, Coskata might use some of the cellulosic ethanol from its demonstration plant to help advance the auto-racing industry, Bolsen said.

The IndyCar Series and Formula One already use ethanol and the American La Mans Series began using cellulosic ethanol this year (see Racing Toward Green).

Bolsen’s goal is to win over NASCAR. "NASCAR hasn’t done this yet, and if Coskata could provide some [cellulosic ethanol] for free off this [demonstration plant], that would be a fantastic win for us," he said.

Meanwhile, Coskata also is working to close partnerships for its first commercial plants.

The company expects to break ground on its first plant, which will have the capacity to make between 50 million and 100 million gallons of ethanol annually, this year and to have the plant up and running in late 2010. Coskata in February announced a partnership with ICM, a Colwich, Kan.-based ethanol plant design, engineering and support firm, to design and construct its first commercial plant (see More Cellulosic Ethanol Will Soon Be For Sale. But Who’s Buying?).

But it is still pinning down the specifics -- the "who, what feedstock and how many gallons," Bolsen said.