NextEnergy eNews Update - Issue 2

FALL 2007 | Vol. 1 | No. 2

On June 31^st, the Michigan Renewable Fuels Commission, a twenty-seven member group assembled by Michigan Governor Jennifer Granholm and to which I was appointed delivered our Initial Report.

The most significant learning, in my opinion, is Michigan's unique and advantageous potential to become a national leader in renewable fuel development, standardization, use, and commercialization. Although leadership in this sector will take a tremendous effort by government and industry alike, Michigan has all the ingredients to be successful.

Let's start with feedstock development. Only California of all 50 states has the diversity of natural resources needed to develop renewable fuels that Michigan has to offer. With the Great Lakes, our 19 million acres of forestland, our 10.1 million acres of farmland and our over 200 agricultural commodities including corn, soy, and other bio-feedstocks, Michigan is uniquely positioned to grow the entire spectrum of biofuels of the future within our state's borders.

Standardization of the fuels is already underway, with ongoing efforts working toward this goal at the National Biofuels Energy Laboratory (NBEL) at NextEnergy Center. As NextEnergy begins our 2^nd year of this important research consortia, we've expanded beyond traditional automotive OEM and their Tier 1 suppliers, to participants across the entire biofuel value chain: from plant science (Monsanto) to end use (Art Van Furniture delivery fleet).

With several commercial biofuel plants already announced or in existence in Michigan, the Commission detailed a number of incentive structures to ensure that we are well positioned to attract the next generation biofuel innovators and project developers. The recommendations include incentive funding in excess of $250 Million over the next 5 years to attract pilot scale and "serial #1" production facilities from a wide range of feed stocks and biofuel outputs. The recent announcement by Mascoma is an example of Michigan's growing leadership in cutting-edge biofuel production.

Practical usage of emerging biofuels is also a great fit for Michigan. Michigan is 8^th in the nation for gasoline expenditures, and the Governor is dedicated to opening more and more biofuel pumps at service stations to service the ever-expanding fleet of flex fuel vehicles now on Michigan roads.

And last but not least, the Michigan Renewable Fuels Commission recommends a dedicated effort to commercialize biofuels, with extensive marketing and communications tactics to inform, educate, and inspire both consumers and retailers to understand and make use of the emerging biofuel infrastructure just beginning to gain traction in Michigan.

With our combined automotive and agricultural backgrounds, there is no state in a better position to lead the country, and the world, in biofuel development, production, and use. The Michigan Renewable Fuels Commission recommendations provide a detailed roadmap for aggressively growing Michigan's biofuels industry. However, much work is to be done by our legislature to enact the policies and incentive structures detailed in the report, thus, ensuring Michigan's competitive position in attracting the leading companies in this field.

NextEnergy is proud to serve on this important commission, whose newly completed study paves the way toward a greener, more nationally self-sufficient energy future for us all. For complete text of the Michigan Renewable Fuels Commission report, please visit www.renewablefuelscommission.org.

Jim Croce
CEO NextEnergy

This summer marked the initial launch of NextEnergy's Alternative Fuels Platform located at the NextEnergy Center in Detroit's TechTown. "The Alternative Fuels Platform achieves NextEnergy's goal of providing state-of-the-art testing and validation as well as facilitating codes and standards for the entire spectrum of alternative fuels including, but not limited to, hydrogen, biodiesel, ethanol, butanol, and methanol," says NextEnergy COO David McLean, project director for the Alternative Fuels Platform, "Our existing BP hydrogen fueling station has been in operation for over a year, and now the rest of the platform is ready to accommodate organizations and companies as diverse as the Department of Energy, Sandia Laboratories and REB Research in the quest to develop and standardize a full array of alternative transportation fuels." Occupying 18,000 square feet of testing space and 5 separate bays, NextEnergy's Alternative Fuels Platform is the only testing facility of its kind in the United States, and one of only three such alternative fuels platforms in the world. "The point of the platform is to provide as much essential data as possible to move the global alternative fuels distribution infrastructure forward," summarizes McLean.

NextEnergy worked mainly with two Michigan companies to complete this work. Albert Kahn Associates, Inc. provided the engineering design and construction documents for the platform. Kahn is a 270 person architecture, engineering, planning design, and management firm headquartered in Detroit. Peter Lynde, PE, LEED AP, heads Kahn's Research & Technology efforts. In this capacity he is responsible for securing and executing all of the firm's research and technology business. "Alternative energy opportunities are a major focus for Kahn. To the best of my knowledge we are one of the few fully integrated firms in the nation that regularly provides commercial hydrogen infrastructure design services," says Lynde. Kahn is not tied to any product or fuel and, therefore, can provide independent third party analyses of its clients, regardless of the equipment or fuel being considered. Kahn is the engineer-of-record for the NextEnergy Center and is licensed in all 50 states. For further information contact Peter Lynde at (313) 202-7880 or peter.lynde@akahn.com

Next Energy's Alternative Fuels Platform was constructed by DeMaria Building Company. DeMaria, a Detroit-Headquartered Business, is a General Contractor, Construction Manager, and Design/Builder that specializes in building within the Alternative Energy market.

Among DeMaria's recent energy experience are four (4) projects for NextEnergy including the National Biofuels Energy Laboratory. DeMaria has also built a Compressed Natural Gas Facility and Biodiesel Production Facilities in Detroit and Adrian, Michigan that produce 40 million gallons of biodiesel fuel a year.

Learn more about NextEnergy's Alternative Fuels Platform at www.nextenergy.org

On May 18^th, Jim Croce welcomed the Hon. Kohe Suzuki, mayor of Toyota, Japan for an extensive tour of NextEnergy. Communicating through an interpreter, Mr. Croce and Mr. Suzuki shared common interests in preserving the environment both in the U.S. and the Japanese city which Toyota calls home. Of particular interest to Mayor Suzuki was Jim Croce's informative description of the great potential for alternative fuel use of wood waste in the form of cellulosic ethanol. Toyota, Japan has a wood waste surplus that could dovetail into this emerging technology. Following this historic meeting, Jim Croce traveled to Japan in September to attend the Midwest US-Japan Association conference, accompanying a delegation from the Michigan Economic Development Corporation (MEDC) to follow up on potential partnerships with Japanese companies in the CleanTech sector. "This is an incredible opportunity for Michigan to, once again, take world leadership in these emerging technologies that, like the automobile, will forever transfigure and improve the world as we know it," states Croce.

Kelly Jezierski: has joined NextEnergy as Program Delivery Coordinator in the Operations group. Kelly implements strategy and delivery of all of NextEnergy's diverse alternative and renewable energy programs, including the ongoing biofuels service station refitting going on throughout Michigan. Jezierski has a Bachelor of Science in Chemical Engineering from Wayne State University and is completing her Masters of Science in Alternative Energy Technologies also at WSU.

Roland Kibler: joins NextEnergy as Technology Development Manager. He is responsible for making technical and market assessments to support the development of emerging alternative energy companies and technologies. He is also available to our clients and partners as a technical resource. Roland received his Bachelors degree in Electrical Engineering from General Motors Institute (now Kettering University) a Master's degree in EE from Michigan State University, and an MBA from the University of Michigan.

Also joining NextEnergy's team is Sonali Vijayavargia. Ms. Vijayavargia, a venture capital specialist, will help secure funding and guide Michigan startup companies in the alternative energy sector. Contact Sonali at sonali@augmentcapital.com

When Dan Radomski, NextEnergy's Vice President/Director of Industry Services, attended June's American Wind Energy Association (AWEA) annual conference in Los Angeles, he brought with him a clear declaration that Michigan is "open for business" in the wind turbine manufacturing sector in the form of a "Build It In Michigan" full color brochure developed by NextEnergy in conjunction with the Michigan Economic Development Corporation. "We want the world to know that Michigan is ready to manufacture the parts that go into the wind turbine towers our world so badly needs," says Radomski. "There are over 8,000 parts in a wind turbine, demand far outstrips supply worldwide, and no state has more manufacturing know-how than Michigan." Radomski said the response was overwhelming. The brochure features a map of Michigan with over two dozen existing wind industry suppliers.

To capitalize on new, worldwide interest in Michigan as a wind energy manufacturing center, NextEnergy, Michigan State University's Land Policy Institute, and the MEDC cosponsored a Michigan Wind Energy Manufacturers symposium in East Lansing on September 10^th and 11^th. Global wind energy OEM's such as GE, Ecotecnia, Siemens, and Acciona were in attendance to present their manufacturing supply chain challenges/opportunities and meet one-on-one with Michigan suppliers to advance their programs in delivering wind turbines to a worldwide market. Clipper Windpower also met with NextEnergy and Michigan wind component manufacturers on September 6^th.

To learn more about the September Wind Energy Symposium in East Lansing, Michigan visit www.michigan.org/medc

NextEnergy is proud to announce the winner of 2007's Alternative Energy Lab Competition ... Power Panels, Inc. (formerly Menova, Inc.). With an effective prototype demonstration and business plan, Power Panels, Inc. emerged from a field of over one dozen applicants to win NextEnergy's prize, which awards Power Panels, Inc. with $25,000 in seed investment, $25,000 in facilities expenses for laboratory build-out in one of NextEnergy's eight labs, 3 months rent free, plus tax incentives such as the Michigan NextEnergy Authority Tax Credits. Additional services awarded the winner are 40 hours of free consulting by NextEnergy staff, 30 hours of grant writing and management support, priority access to testing at NextEnergy Center, and $25,000 in marketing support. Power Panels, Inc. is a startup focused on manufacturing low cost solar thermal and PV energy generation systems within a single rooftop device, for commercial and residential use.

NextEnergy assisted the Michigan Economic Development Corporation in securing Massachusetts-based Mascoma Corporation's commitment to building the state's first cellulosic ethanol plant in a Michigan location yet to be announced. The Mascoma plant will turn the state's abundant, non-food plant matter into clean burning ethanol fuel. Michigan Governor Jennifer Granholm announced on July 19^th that, "Mascoma's decision to choose Michigan is helping us achieve a key part of our economic plan - making our state a leader in alternative energy production." Mascoma CEO Bruce A. Jamerson adds, " It is exciting that the birthplace of the American automobile industry is becoming the leader in next-generation biofuels."

Mascoma Corporation is a low-carbon cellulosic biomass-to-ethanol company based in Cambridge, MA, with a research and development laboratory in Lebanon, NH. Earlier this year, the MEDC and NextEnergy established a cellulosic biofuels working group to promote the industry in Michigan. Together, they identified and targeted Mascoma as the lead company to partner with in generating renewable fuels from Michigan's forestry resources, and believe the partnership with Mascoma will dramatically advance Michigan as a national leader in the next generation of renewable fuels.

For more information about the MEDC, NextEnergy, Mascoma, and cellulosic ethanol visit www.michigan.org

NextEnergy continues to be deeply involved in promoting Renewable Portfolio Standards (RPS) both for the state of Michigan as well as on a national level. It is NextEnergy's convinction that states that enact an RPS are better positioned to attract alternative and renewable energy innovators, manufacturers, and project developers to their state. A study completed by NextEnergy on behalf of the Michigan Department of Environmental Quality entitled "A Study of the Effects of RPS and Energy Efficiency Program's on Michigan's Economy" reaches that conclusion, as do other recent studies developed in Michigan, such as the Renewable Energy Policy Project (REPP) report for the Detroit Economic Growth Corporation entitled "Component Manufacturing: Michigan's Future in the Renewable Energy Industry." A third study which reaches similar conclusions is the University of Michigan Center for Sustainable Studies graduate studies project entitled "Michigan at a Climate Crossroads: Strategies for Guiding the State in a Carbon-Constrained World" which performed a macro-economic analysis of various carbon-reduction strategies/policies including a RPS scenario for Michigan.

All three RPS studies are available at www.nextenergy.org

NextEnergy is proud to announce the Alternative Energy Business Growth Workshop Series for Fall 2007 and Winter 2008. The workshop topics are as follows:

Workshop #1: Moving from a Research Endeavor to a Profitable Business
Workshop #2: Obtaining Funding from Private Investors
Workshop #3: Developing Strategic Partnerships in the Alternative Energy Sector

The first workshop will be in November and hosted by LEAP (Lansing Area Economic Partnership), Inc. in Lansing, Michigan.

The second workshop will be hosted by Automation Alley in Troy, Michigan (date forthcoming)

Details for registration will be available soon. In the meantime, go to www.nextenergy.org/aetworkshops.asp or request more information at info@nextenergy.org.

To become a partner in Michigan's Statewide AET Network, contact Pamela Hurtt at pamelah@nextenergy.org

The Michigan Renewable Energy Exchange (MI-REX) has its first program participant; a 1.95 kW photovoltaic (PV) system in Grand Haven, MI. MI-REX is a new pilot project operated by the Michigan Energy Office to provide a means for owners of small solar and wind electric systems to sell Renewable Energy Certificates (RECs). At this time the Energy Office is accepting applications to participate in MI-EREX. Contact www.michigan.gov/eorenew for details.

DTE Energy/MichCon Energy Seminars for businesses and residential customers. For more information contact Bob Fegan at feganb@dteenergy.com or at (616) 954-4619.
Oct. 13 - Traverse City, Northwestern Michigan College
Oct. 25 - Troy, Troy Community Center - residential only
Oct. 28 - Livonia, Laurel Manor - residential only
Nov. 4 - Ann Arbor, The ARC - residential only
E2 detroit - Entrepreneurs forum Wayne State University October 1^st and 2^nd

Effects of Electrochemical Oxidation of Non-Aqueous Electrolyte on Lithium Transition Metal Oxides
    Time:       5:30 pm Reception / 6:30 pm Dinner / 7:30 pm Speaker
    Date:       Tuesday, October 16^th, 2007
    Location:  Lawrence Technological University
                   21000 West Ten Mile Road
                   Southfield, MI 48075
    RSVP by: Tuesday, October 9^th, 2007 to Chad Kotarba
                    ckotarba@ovonic.com, (248) 293-0440, x7057
    Sponsored by: The Electrochemical Society - Detroit Section, and Toyota

Alternative Energy Manufacturing 101: November 13^th, 8 am to 4 pm, Oakland County Conference Center, 2100 Pontiac Lake Road, Waterford, MI. An informative workshop hosted and sponsored by Oakland County Economic Development & Business Finance Corporation in partnership with NextEnergy, Butzel Long, Michigan Manufacturers Technology Center, and Shepherd Advisors. This interactive workshop will assist Oakland County manufacturers in diversifying, growing, and succeeding in the emerging alternative energy industry. Come learn from others who have already made the transition. Get additional info at http://www.oakgov.com/peds/calendar/aem101.html

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