Startup Terragia secures $6 million to develop cost-competitive, low-carbon biofuel technology

Terragia's leadership team (Photo: Business Wire)

Technology startup Terragia Biofuel announced March 28 that it has raised $6 million in a seed round led by Engine Ventures and Energy Impact Partners.

The company will use the capital to commercialize its novel biology-based approach to converting cellulosic biomass into ethanol and other products, expand its employee headcount and initiate partnerships with major biofuel producers.

Terragia uses engineered thermophilic bacteria to break down cellulosic biomass and convert it into ethanol and other chemical products.

The company’s technology avoids key features responsible for the high cost of conventional cellulosic biofuel production by one-step “consolidated” bioprocessing without added enzymes, and leveraging mechanical disruption during fermentation (i.e., “cotreatment”) in lieu of thermochemical pretreatment.

“Cellulosic biofuels are a route to low-carbon fuels for aviation and other difficult-to-electrify transport modes as well as CO2 removal from the atmosphere, both of which are critical for climate stabilization,” said Martin Keller, director of the National Renewable Energy Laboratory. “One-step biological conversion of cellulosic biomass without added enzymes or thermochemical pretreatment has clear cost-reduction potential relative to other process concepts.”

Lee Lynd, Terragia’s chief technology officer (CTO) and co-founder, added, “Conversion of ethanol to fuels for planes, ships and trucks is a leading option for approximately half of future global transportation energy demand, for which electrification is likely impractical, corresponding to a $1 trillion market. With full penetration of this market, Terragia’s technology is projected to displace 3 gigatons of CO2 emissions annually and enable capture of a yet larger amount of CO2.”

In partnership with Dartmouth College and the University of Campinas, the ongoing development of Terragia’s technology is supported by funding from the U.S. DOE’s Center for Bioenergy Innovation and the São Paulo Research Foundation, by grants from USDA and National Science Foundation, as well as private capital.

“Terragia has an exciting opportunity to succeed where others in the cellulosic biofuel industry have not,” said Katie Rae, CEO and managing partner of Engine Ventures. “The company’s technology provides a radically different approach that uses biology to reduce the high costs and scale of conventional cellulosic biofuel production. With an experienced management team, deep industry experience and a joint-development agreement with a major U.S. biofuel producer already underway, Terragia’s go-to-market approach has the potential not only to meet future global transport demand but to create low-carbon biofuel products at a price point competitive with fossil fuels.”

Ashwin Shashindranath, a partner at Energy Impact Partners, added, “We are proud to support Terragia on their path to revolutionizing cellulosic ethanol and sustainable aviation fuel production. Low-carbon fuels are a cornerstone of the energy transition, and we think Terragia has the right team and technology to become a leader in the field.”

Terragia also announced leadership changes with the appointment of Kristin Brief as CEO effective immediately.

Brief joins co-founders Lee Lynd, who transitioned to CTO, Bill Brady, board chair, and Chris Herring, vice president of technology development.

“It’s an honor to lead Terragia as CEO,” Brief said. “I’ve spent the majority of my 20-year career advancing early-stage clean-energy startups, and Terragia’s technology, team and path to commercialization are differentiated. We have a unique opportunity to make a transformational impact on climate outcomes, in addition to generating substantially higher revenues for biofuel producers.”