Company Name Diversified Energy Corporation	Company Web Site http://www.diversified-energy.com/	Headquarters Gilbert, AZ
Latest News August, 2007 Diversified Energy Corporation's approach, called Simgae(TM) (for simple algae), utilizes common agriculture and irrigation components to produce algae at a fraction of the cost of competing systems. At 1/2 - 1/16th the capital cost, profitable oil production costs at $0.08 - $0.12/pound, and low operations and maintenance requirements, the resulting system will offer the biofuels industry access to cheap and readily available oils and starches for the production of biodiesel, ethanol, and other renewable fuels. Under an exclusive worldwide license, Diversified Energy(R) will provide systems engineering and project management to commercialize the technology.
Funding No additional funding information.
Technology Simgae(tm) Overview Algae has received substantial attention as a high-promise source of biofuel oil to alleviate the supply shortages and high prices of traditional feedstock sources like soybean, palm, canola, animal fats, waste greases, etc. Since the feedstock can contribute roughly 80% of the cost of biofuels production, keeping the feedstock affordable and readily available is paramount for continued growth of the biofuels industry. Algae has been shown to produce 25 - 100X more oil and require substantially less water to grow per surface area compared to other biofuels crops like soybeans. In addition, the non-oil components (i.e., carbohydrates and proteins) left over after oil extraction can be used for a multitude of purposes - as inputs into animal feed, fish feed, fertilizers, dyes, etc. or used to produce fuels/energy through fermentation, gasification or anaerobic digestion. Certain algae strains also produce polyunsaturated fatty acids (omega-3's) in the form of eicosapentaenoic acid (EPA) and docosahexaenoic acid (DHA) - nutritional supplements generally found in fish oils. These additional products greatly enhance the overall marketability and economics of producing algae. Algae consume inputs like sunlight, water, CO2 and nutrients, and can generally be cultivated on land not suitable for other purposes. The ability to ingest CO2 and produce oxygen through photosynthesis is particularly attractive as a means to curtail carbon emissions. Given all these benefits, algae production has yet to materialize in any meaningful volume. The reason for the lack of market adoption is centered upon the significant capital and operations and maintenance (O&M) costs to build and maintain the systems. Algae, being a biological organism, are easy to grow in small volumes (i.e., laboratory systems), but not easily extrapolated into large-scale architectures producing consistent algae yields over long periods of time. The resulting production costs have been the Achilles'heel for investors and developers. Open architecture approaches (e.g., ponds or traditional racetracks), while possibly the cheapest of all current techniques, suffer challenges with contamination, evaporation, temperature control, CO2 utilization, and maintainability. The preferred alternative are closed approaches, generally known as "photobioreactors," where the algae fluid remains in a closed environment to enable accelerated growth and better control over environmental conditions. These glass or plastic enclosures, often operated under modest pressure, can be mounted in a variety of horizontal or vertical configurations and can take many different shapes and sizes. Rigid frameworks or structures are usually used to support the photobioreactor enclosures. As a consequence, the myriad customized photobioreactor components result in high installation, capital, and O&M costs for large-volume applications (i.e., 1000+ acres). The industry response to this challenge has been to add further "bells and whistles" to the photobioreactors and to search for optimal algae strains. Performance has been increased as a result, but at the expense of additional cost and complexity. The DEC Simgae system is an agriculture-based solution to large-scale algae production that has the benefits of both open and closed systems. Instead of creating elaborate and complex architectures designed to push yield to its maximum, the proposed system makes cost and simplicity the driving variables. The approach can basically be thought of as the "farmer's solution" to algae production. Figure 1 depicts a notional small-scale Simgae implementation. The system utilizes a series of clear, thin-walled polyethylene tubing material. This tubing is analogous to conventional drip irrigation tubes, but can be optimized with the addition of certain UV inhibitors, color schemes, and reflectivity. The current design for the tubing is based on trough shapes (tubes that are v-shaped on the bottom) that may or may not be closed on the top. Preliminary estimates are that Simgae capital costs (including installation, but not including land, harvesting, oil extraction, and product storage) will be in the range of $25k - $35k per gross acre. Competing systems have publicly claimed ranges anywhere from $100k - $1M per acre. Simgae"! is therefore expected to deliver a roughly 4X - 30X reduction in capital costs. Simgae annual yield is expected to be on the order of 40 - 60 tons of dry algae mass per gross acre (40 tons = approximately 24 g/m2-day), with oil content anywhere from 10 - 30%. This yield and oil content range is dependent upon a number of conditions, including sunlight and temperature, sources of CO2 and nutrients, algae strain used, and emphasis on oil versus carbohydrate/protein production. These yields and costs correlate to "Generation 1" physical test results conducted by DEC in both indoor and outdoor systems. The yields are also consistent with academic and industry experience in growing algae in open and closed architectures. The substantially lower Simgae capital costs, coupled with its competitive yields, ultimately translate into attractive project economics. Based on a discounted cash flow, net present value analyses DEC believes algal oils could be produced much cheaper than current market prices of renewable oils from sources like soybeans. In addition, algal biomass systems like Simgae offer a clear path to a stable, domestic, secure, and non-food based source of renewable feedstock. A summary of the key Simgae benefits include: 1) Simple, low risk architecture based on common agriculture components and processes 2) Easy installation and operations and maintenance 3) Substantial capital cost reductions, coupled with competitive yield expectations priced algae oils and solids 4) Broad application due to the system not being reliant on any one source of CO2 or nutrients
Other Info Diversified Energy Corporation, a privately-held alternative and renewable energy company, is developing and commercializing an innovative algal biomass production system. Aimed at addressing the shortage and rising prices of oil and carbohydrates for biofuels production, food versus fuel crop challenges, all coupled with accelerating environmental concerns from fossil fuel emissions, Simgae (for simple algae) offers a low cost and simple approach to growing algae at large scale. The focus on cost and simplicity addresses the major reason algae production has yet to materialize in any meaningful volumes. Diversified Energy (DEC) has filed for intellectual property protection as both inventors and co-inventors of the technology.