The intellectual property of alternative transport fuels

The Pacific 2012 Forum on Sustainable Maritime Fuels was held recently in Sydney and brought together American, Australian, and New Zealand leaders in the development of alternative fuels. The forum, chaired by Susan Pond AM of the University of Sydney’s United States Studies Centre, discussed the challenges facing the maritime industry (and aviation and automobile transport industries) as it comes under increasing pressure to increase sustainability.

 

The Forum featured presentations from US based Gevo, a leading developer of renewable chemicals and alcohol biofuels, Australia’s Licella, which produces biocrude oil from waste wood biomass, New Zealand’s Aqua Bionomic Corporation, which manufactures algae based fuels, and the US Navy. Alternative transport fuels have attracted controversy due to their perceived damaging effect on land use but the clear message from the Forum is that the production of alternative fuels is sustainable and is beneficial when associated with by-products such as distillers’ grains, yeast feeds and renewable electricity.

However, continued Government investment is critical. On the back of the Forum, success was achieved – US Navy interest in Licella and the NCRIS lignocellulosic ethanol facility at Mackay Sugar was announced. However, there was also a set-back. Manildra, one of few operational ethanol distilleries in Australia, announced it is to halt plans to increase its capacity based on the NSW O’Farrell Government’s decision not to ban regular unleaded petrol. As a week in politics is a long time so it is for alternative fuels.

Intellectual property in alternative fuels has been driven by Government mandates for clean technology, such as the blending of ethanol in transport. We have previously described the boom in clean technology sector. There has been an increase in patent filings since the Kyoto protocol was ratified in 1997. Analysis has shown that six countries (Japan, US, Germany, Korea, France and the UK) dominate patent filing in clean technology. The US takes the lead in alternative transport fuel filings.

Managing intellectual property in the field of alternative transport fuels centres on the protection of rights in large capital and time intensive projects that require the successful combination of a large number of disparate technologies. Speeding the up-take green technologies, the development of fast-track patent systems including expedited examination, which we have previously described, technology transfer agreements, structured licensing mechanisms, developing more green patent laws are all issues. For alternative fuels to be truly global technology adoption by developing countries is key. Here, compulsory licensing may play an important role.

There is also cause for serious concern about the monopolies some entities exhibit in the field of biofuels. Manildra, for example, has a monopoly over bioethanol production in NSW, and it is thought that US biofuel patents are owned by about 80 entities. The “Gene Giants” Monsanto (the world’s largest seed producer) and partners Ceres, Evogene and Mendel Biotechnology, BASF (the world’s largest chemical company) and DuPont account for much of the ownership of patent plant genes and may dominate future energy crop production for fuel feedstock. In this regard, patent pools may help shape the industry.