Ottawa’s Iogen helping to fuel the next green wave

Ethanol producer eyes growth in U.S., Europe
Fuel pumps

As governments and consumers around the world increasingly look for cleaner alternatives to fossil fuels, an Ottawa-based biofuels company is hoping its early-mover advantage in the industry will help position it to capitalize on an expected boom in demand for renewable energy.

Iogen specializes in cellulosic ethanol, which unlike typical renewable fuels such as corn ethanol, is made primarily from agricultural waste and results in fewer greenhouse gas emissions. It is compatible with modern combustion engines, making it an attractive alternative to fossil fuels.

“People are drawn to cellulosic ethanol for three main reasons: Concern for the environment, concern for agriculture, and oil-related security concerns,” said Iogen CEO Brian Foody, who joined the company in 1982 when the biofuel market was still in its infancy. 

“We’ve been engaged in that business since the very beginning and we have a good position in part because we are really knowledgeable about the marketplace,” he added. 

As one of the first firms in the Canadian biofuel market, Iogen cut a path for itself and other companies, investing half of a billion dollars into research to improve ethanol’s efficiency. 

The company built and operated the world’s first cellulosic ethanol demonstration plant, and brought ethanol to Canadian gas pumps for the first time, right here in Ottawa.

But for Foody, the Canadian market was not enough.

Global reach

In 2014, Iogen partnered with Raízen, Brazil’s leading ethanol producer, to open a US$100 million expansion mill for the production of cellulosic ethanol. The facility produces approximately 151 million litres of biofuel per year.

Since then, Iogen has turned its sights – and patents for cellulosic ethanol – to the two largest biofuel markets: Europe and the United States, where Iogen is already the country’s fifth-largest producer of cellulosic ethanol and Foody has been called upon by federal politicians setting renewable fuel standards.

He previously testified before both the U.S. House of Representatives and the Senate as they debated legislation that ultimately established minimum ethanol requirements for oil refiners. Now, ethanol is blended into almost every fuel type.

“Biofuels are still somewhat of a niche in the United States,” Foody said. “But they are, if you will, the gold standard for green fuels.”

But the influence of politics on the renewable fuels market can also create volatility.

During Donald Trump’s presidency, the U.S. Environmental Protection Agency granted dozens of exemptions in 2018 to oil refineries from the mandatory ethanol requirements, hurting firms such as Iogen.

“We saw the price for renewable fuels fall to its worst by nearly 80 per cent from its peak in 2017,” Foody said. “The market has recovered much, but not all, of its losses.”

But later in his presidency, Trump moved to block similar exemptions for oil refineries while also looking to boost ethanol production in an effort to appease corn farmers.

Foody said he’s hoping that the incoming Biden administration will set a clear path to increase the use of renewable fuel.

“We are very much looking forward to what the next step in the evolution of the market will be, and are looking to be leaders,” he said.