opx.JPGOPX Biotechnologies, a new startup that hopes to modify microorganisms to produce fuels similar to those we use for power generation today, has received $3.6 million in a first round of venture funding.

Although fuels like biodiesel and ethanol are also called biofuels, the term has a different meaning for companies like OPX. It, and a small handful of other companies, are modifying the DNA of bacteria, fungi and other lifeforms to cause them to produce fuels as a natural waste by-product.

Scientists have already proven that using microorganisms can result in higher efficiency over conventional methods of making biofuels. Unfortunately, there are various problems. The organisms often die, for instance, or don’t produce a high enough volume of fuel.

The trick is to modify their DNA to make changes. However, getting precise results is difficult or impossible, and each must be tested out in turn. That means the process of changing multiple genes in a bacteria to create a fuel-production unit is akin to walking through a casino spinning each roulette wheel, hoping that each will land on a winning combination.

Robert Chess, the company’s new CEO, said in an interview that OPX’s advantage is in how quickly it can spin the wheel. The company’s founders, two scientists from the University of Colorado in Boulder, have developed a method to make multiple changes at once while aiming at a specific result, like raising the tolerance of a yeast for living in its own waste, the fuel by-product. They say their process will be up to thousands of times faster.

That’s good news for the company, because it’s already behind. OPX was only founded earlier this year, by which time companies like Amyris (our coverage) and LS9 (our coverage) had already hit on some winning combinations. They’re beginning work on building pilot plants. That said, pilot plants don’t necessarily suggest success. Just look at the solar cell industry, for a comparison: Multiple start-ups have produced pilot plants for new cells, but most of them are still struggling to get to market and have suffered multiple delays. The same is likely to happen in new biofuels.

To catch up, OPX must first identify the main microorganism strains it wants to work with, and what kind of fuels it wants to produce. It hopes to have a pilot plant in the works by 2009, which is early enough to keep it in the running.

Each competitor in the race to produce a cost-effective biofuel must take some time to build up capacity, which will give later entrants — include Gevo (our coverage) and Green Biologics (our coverage) — some time to scale up. The potential upside to all for producing a cheaper alternative to gasoline and other fuels is, of course, enormous.

OPX is still based in Colorado, although Chess is located in Woodside, Calif. The $3.6 million funding was provided by Mohr Davidow Ventures, along with X/Seed Capital, which did the company’s seed funding round.