Head over to our on-demand library to view sessions from VB Transform 2023. Register Here
Enerkem, a company that specializes in converting unusable waste into ethanol and other chemicals, announced today that it has raised $30 million in an extension of its most recent funding round.
Enerkem converts household garbage and leftover debris from demolition and utility poles into chemicals that appear in household objects. That includes ethanol and acetates. The company raised $60 million last month.
“Enerkem’s one of the strictly fuel-focused companies getting funding because they are flexible on the upstream point of view,” Lux Research analyst Andrew Soare told VentureBeat. “But there are still a couple of question marks related to their ability to switch from producing methanol to ethanol.”
When contacted by VentureBeat, representatives from Enerkem said they could not comment past the official announcement today. Soare said the company likely needed funding because Enerkem’s biofuel production facilities carry large upfront capital costs. It costs around $8 to produce the means to make 1 gallon of biofuels, he said.
Enerkem has secured a $130 million loan guarantee from the U.S. Department of Agriculture and U.S. Department of Energy for a plant in Pontotoc, Miss., that will generate around 10 million gallons of ethanol and other biofuels annually. The company is also constructing a plant in Edmonton, Canada, that will generate 10 million gallons of ethanol and other biofuels annually.
Valero, which participated in the most recent $60 million round, is one of the company’s largest strategic investors. That means the oil giant might either use Enerkem’s technology to produce ethanol or purchase petrochemicals from the company as part of an agreement with Enerkem.
The Montreal, Canada-based company raised $51.5 million in an earlier funding round led by Waste Management. The company has raised a total of around $166 million. It currently only operates one active plant that generates 1.3 million gallons of biofuel yearly in Quebec, Canada.
VentureBeat's mission is to be a digital town square for technical decision-makers to gain knowledge about transformative enterprise technology and transact. Discover our Briefings.