LanzaTech: Radically Rethinking Industrial Business Models

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November 12, 2021

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by Erik Kobayashi-Solomon (Forbes) A visit this summer to New Zealand-American synthetic biology company, LanzaTech, opened my eyes to what the term “paradigm shift” means. LanzaTech is an industrial chemicals company that leverages innovations in biology, artificial intelligence, and precision engineering to create the molecules that make everything from yoga pants to jet fuel possible – all without digging up fossil fuels.

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While we think of centralized production is “natural” and “efficient”, it carries with it definite risks.

For example, there is the “all your eggs in one basket” problem.

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We’ve got a lot of eggs in a single geographical basket, and while that set-up might seem “efficient”, it is certainly not robust to increasingly severe tropical storm systems.

Centralized production also usually means long supply chains.

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Another risk of centralized production is the concentration of harmful waste products.

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But it is not as though we can simply stop producing what we are producing now. How can we maintain our standard of living and continue to use the products we have come to know and love without suffering from these problems?

The answer lies in a distributed model that “numbers up” rather than “scales up.”

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LanzaTech’s CEO, Jennifer Holmgren, PhD., started her career as a newly-minted PhD working for Universal Oil Products in Chicago. This firm, now owned by Honeywell, essentially invented the modern petrochemical manufacturing industry by developing and patenting the oil refining technique known as thermal cracking back in 1914.

With this professional background, Holmgren knows a lot about the thermal catalytic processes that form the basis for the legacy petrochemical refining process; she also understands its strengths and weaknesses very well.

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After Honeywell acquired UOP, Holmgren found her way into cutting-edge research that was being done in biofuels. She spearheaded Honeywell’s efforts in the Green Hornet project – proving that a 50% biofuel blend could function as a drop-in replacement to conventional jet fuel to power an F-18 fighter jet (something that many industry observers thought was impossible when the project was first announced).

Considering this experience, Holmgren also knows an enormous amount about the strengths and weaknesses of manufacturing biofuels.

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When Holmgren realized that LanzaTech was able to sweep up waste carbon emissions from other industrial and agricultural production processes to create a flexible commodity chemical like ethanol that could be further synthesized into a host of useful substances (including sustainable aviation fuels – SAF), she realized there was a viable solution to the raw material scarcity problem.

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She also understood, however, that the way people conceived of commodity chemical manufacturing had to completely change. Rather than scaling up – building an enormous facility to produce huge volumes of commodity chemicals – the new paradigm would involve “numbering up” – increasing the count of facilities capable of producing lower volumes of the chemicals.

“Biological processes are much more selective than thermo-catalytic ones, so you only need a single, targeted process step. This means operating at a completely different scale than the one at which a multi-step refinery operates,” she explains.

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For instance, as I mentioned in my earlier article about LanzaTech engineering, LanzaTech can attach one of its anaerobic bacterial bioreactors just as easily to a steel plant as to a municipal waste dump’s gasification plant.

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This kind of numbering up would turn the business of commodity chemical production on its head! Rather than local municipal waste dumps being hazardous burdens, they would become profit centers, allowing cities to lower taxes, provide more public services, and the like.

However, it’s safe to say that most people working in the municipal waste industry do not have a firm grasp on genetic engineering or synthetic biology. This is why today, LanzaTech’s focus is on making their cutting-edge bioreactor units able to be operated safely and effectively by non-experts.

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Using LanzaTech’s bioreactor, however, when the price of Chemical A is low compared to Chemical B, all a manufacturer needs to do is to order a supply of a bacterial strain that metabolizes Chemical B and voila – you can now switch to selling Chemical B.

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In contrast with its competition, LanzaTech is using a production process that:

Soaks up greenhouse gases rather than emitting them,
Allows for less geographical concentration,
Creates greater climate disaster-related resiliency,
Offers greater flexibility in end product,
Opens the possibility of bringing jobs back to “fly-over country”, and
Reduces dependency on long, foreign supply chains.

In a perfect world, these factors would mean that LanzaTech’s products would be at least an order of magnitude more valuable than products manufactured by competitors. Unfortunately, ours is a highly imperfect world where incumbents hold undue and damaging influence over the lever of political power, so can avoid or delay sensible public policies. READ MORE includes link to TEDx Talk

LanzaTech’s Paradigm-Shifting Plan To Create Carbon-Negative Industrial Chemicals (Forbes)

SynBio: The Science Behind LanzaTech’s Success (Forbes)

LanzaTech: Engineering The Future (Forbes)

Saving Our Planet by Recycling CO2 | Jennifer Holmgren (TEDxChicago)

ArcelorMittal expands partnership with carbon capture and re-use specialist LanzaTech through US$30 million investment (ArcelorMittal)