SK Inc., the strategic investment arm of South Korea’s SK Group, was part of a $50-million investment in Fulcrum BioEnergy, a US-based waste-to-fuels company. SK Inc. was joined in the investment with a Korean private equity fund.
Fulcrum produce biofuel on a commercial scale by chemically converting municipal solid waste (MSW) into transportation fuels. SK Inc. plans to enhance its Environmental, Social and Governance (ESG) portfolio with its investment in Fulcrum.
SK Inc. has been expanding investments in green businesses and technologies to achieve its goal of net-zero greenhouse gas emissions in response to global climate change. Leveraging Fulcrum’s proprietary process which utilizes proven technologies and capabilities on a commercial scale, SK Inc. aims to make an inroad into the Korean bioenergy market with SK Ecoplant, another SK group company, as a potential partner. SK Ecoplant is a global engineering and construction firm that has placed a priority on environmentally friendly energy and infrastructure projects.
Fulcrum’s first MSW-to-fuels facility, Sierra BioFuels, located near Reno, Nev.
Founded in Pleasanton, Calif., in 2007, Fulcrum has developed a proprietary thermochemical process to convert the organic materials found in MSW to low-carbon drop-in fuels, which can be distributed in the same pipelines as traditional petroleum products. Fulcrum’s bio jet fuel was approved and certified as an alternative drop in fuel for the aviation sector. Fulcrum completed the construction of the first commercial-scale MSW-based biofuels refinery in Nevada in July 2021.
Fulcrum’s process combines gasification technology with a Fischer-Tropsch (FT) fuel process for the efficient, low-cost production of renewable transportation fuels. MSW is delivered to the plant where it is processed to remove recyclable products and other material not suitable for processing. A prepared waste feedstock then enters the gasification process where it is converted to a synthesis gas. This syngas then enters the FT process where it reacts with a proprietary catalyst to form a FT product which is then upgraded to a transportation fuel.
Starting in 2022, Fulcrum’s Nevada plant is set to begin producing approximately 11 million gallons of syncrude annually, which will then be upgraded to transportation fuels such as sustainable aviation fuel. Fulcrum anticipates increased production, as the firm has secured a consistent supply of MSW feedstock through long-term agreements with major waste services companies in the US and has secured offtake agreements with major energy companies and airline companies.
Fulcrum’s business model helps address environmental challenges by reducing greenhouse gas (GHG) emissions and landfill waste. Fulcrum’s technology diverts large volumes of MSW from local landfills, helping reduce methane gas generated by waste decomposition.
Fulcrum makes a direct contribution to reducing MSW volumes by using non-recyclable, landfill-bound MSW as feedstock to produce energy. Fulcrum’s business model could help address various social issues associated with conventional waste disposal, such as a shortage of landfill space and environmental pollution. Fulcrum’s major shareholders include US Renewables Group and Rustic Canyon Partners, the company’s two founding investment firms, BP, United Airlines and Waste Management.
The International Energy Agency (IEA) estimates global biofuel production was 38 billion gallons in 2020 with the US accounting for 45% of global biofuel production based on data from the US Energy Information Administration (EIA). Even with the proliferation of electric vehicles (EVs), biofuel is likely to continue solid growth, driven by robust demand from conventional international combustion engine vehicles (ICEVs) and jet fuel.