Ask the Accountant

Burnaby’s Lignol Energy Corp. took a big step out of the lab and toward the commercial world when it recently signed a US$30-million deal with the U.S. Department of Energy (DOE). The company is developing a method for making ethanol from non-food biomass such as wood chips and inedible agricultural leftovers, which are cheaper materials than the corn and sugar cane traditionally used for ethanol – and allow ethanol-makers to dodge the ethical bog of turning food into fuel.

However, the chemical process is costly and difficult, and Lignol hasn’t yet proved that it can be done commercially; the company has yet to record a profit, losing $4.6 million in its most recent fiscal year. But it will get a chance to prove the technology’s viability, with the DOE agreeing to help finance an almost-commercial-scale ethanol plant in Colorado that Lignol plans to build in partnership with Alberta oil-sands giant Suncor Energy Inc., which is helping to fund the remainder of the $80-million project through a joint-venture agreement.