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Berkeley Lab Seeks Funds For 2nd Biofuel Project

By Richard Brenneman
Friday April 27, 2007

While Lawrence Berkeley National Laboratory (LBNL) officials were pitching their role in the half-billion-dollar grant from British oil giant BP, they were also bidding for a second, similar but federally funded program. 

Aiding in the effort has been a coalition of regional business and economic groups, city officials from Berkeley, Oakland, Richmond and Emeryville and Economic Development Alliance for Business (EDAB)—a powerful but little-known agency that unites the interests of council chambers and corporate boardrooms. 

The Berkeley Daily Planet learned of the bids under the second program, which have not yet been made public, from documents received from the City of Berkeley in response to a California Public Records Act request.  

Alameda County Supervisor Keith Carson confirmed the information in the documents, as did some employees of the Department of Energy and the city of Berkeley who were not willing to go on the record at this time. 

The $125 million Joint BioEnergy Institute (JBEI) would be one of three national centers created by the DOE, each funded for up to $25 million a year over the course of five years. 

The local application is a joint proposal from Lawrence Berkeley, Lawrence Livermore and Sandia national labs, Carson said. LBNL has been playing the lead role. 

Announcement of the final selection could happen as early as June, according to the U.S. Department of Energy official who would speak only on background. 

While no site was listed in the grant application, documents provided under the California Public Records Act request show that strong interest has focused on the Marchant Building at 6701 San Pablo Ave. 

Both the massive “UC/BP” project and the federal program target the same goal—keeping cars on the road in a petroleum-starved world by turning plants into “biofuels.” 

“We see the biocenter as a focus for research and development of alternate resources for energy needs that are going to be increasing,” Carson said. He said the need is especially great given diminishing global oil reserves and the anticipated growth of the U.S. population by 100 million over the next 12 years.  

The principal focus of the project would be creation of ethanol from cellulose, said the DOE representative who would speak only on background.  

Key players who figure in both pitches are a pair of scholars-cum-entrepreneurs who have managed to carve out careers in both the academic and business worlds. 

Both Jay Keasling, listed as project director on the JBEI grant application, and Chris Somerville, a principal investigator, also have leading roles in the BP-backed Energy Biosciences Institute (EBI). 

Somerville is the LBNL scholar proposed to serve as director of the EBI, which is slated to receive most of a $500 billion grant fund by BP p.l.c.., the company formerly known as British Petroleum.  

Officials from the four cities, working with officials from Contra Costa and Alameda Counties, EDAB, the Bay Area Economic Forum, the Bay Area Council and LBNL, have been actively lobbying for the JEBI proposal, working with property owners and brokers, according to the documents obtained from the city of Berkeley. 

The effort is spearheaded by the Economic Development Alliance for Business (EDAB), a private alliance of corporate and government leaders who work to make life easier for businesses to locate and operate in the East Bay. 

EDAB Technology and Trade Director Robert Sakai has been coordinating the effort to enlist local governments in the cause of luring the JEBI—in part because of the promise of corporate startups generated by the researchers and their projects. 

While the proposal submitted to the U.S. Department of Energy (DOE) was written without mentioning a particular site, the written documentation and emails focus on the Marchant Building, also known as the Smith-Marchant Building and sometimes referred to as the “Marchand” building in the documents. 

The building and surrounding lot fall within the boundaries of three cities, Berkeley, Oakland and Emeryville, and the mayors of all three cities co-signed a letter to Under Secretary of Energy Ray Orbach in support of the LBNL grant application. 

Now owned by UC Berkeley, the property would be sold to the consortium of three national laboratories headed by LBNL which have teamed up for the project. The university would lease back part of the structure for continuing research. 

The federal funding specifically precludes using any of the money for buying or building a structure to house the research, said the federal official. 


Evolution of the project 

While the DOE announced plans to fund the centers last August, the earliest mention of the project in the documents provided under provisions of the CPRA is in a Nov. 3 email from Robert Sakai to Michael Caplan and Patrick O’Keeffe, the city economic development directors of Berkeley and Emeryvillle. 

“Our local consortium of research institutions is now competing for a $125 M institute, refocused on biofuels and renamed the Joint Bio-Energy Institute (JBEI—pronounced J-Bay). The JBEI committee has decided to propose to site the facility in either Berkeley or Emeryville,” Sakai wrote.  

In the same email he also revealed a second point: “British Petroleum is planning to establish a $500 M, 10-year Bioenergy program at a major research institution ... After a site visit a few days ago they said one strike against Berkeley is the high cost of living.” 

Sakai said he was working on mortgage assistance packages to help make the region more attractive, and urged the two cities to offer homeowner incentives to the oil company researchers. 

On Nov. 13, Caplan notified Calvin Fong, an aide to Mayor Tom Bates, that Doug Herst, owner of the old Peerless lighting factory site in West Berkeley, had expressed interest through developer’s representative Darrell de Tienne in luring the project to his site. 

Four days later, Sakai wrote to Caplan, O’Keeffe and Eileen DeGuzman, who works on housing issues for Alameda County, reporting that the JBEI application was a joint effort by the three national labs under the guidance of Lawrence Berkeley National Laboratory (LBNL). 

Sakai stressed the importance of offering incentives to the DOE to match those offered by other regions also competing for the lab. “The labs feel we have an edge in infrastructure and personnel, but obviously, the better the return on investment they can demonstrate, the better we can compete,” he wrote. 

Caplan responded 19 minutes later, telling Sakai he had discussed the proposal “with the Mayor, the City Manager and a representative of several large property owners in West Berkeley” (de Tienne), and noting that one owner, presumably Herst, had a site near the freeway and the Fourth Street shopping district. “The Mayor, the CM and I all agree that the bio-energy focus would be a terrific fit for this project ... and could catalyze much secondary and tertiary economic development in the vicinity.”  

One voice of dissent came a half hour later in an email from Dave Fogarty, the second member of the city’s economic development team: “I think it would be more advantageous to convince the University to host the tax-exempt facility on its existing property, maybe on Oxford, and have the incubator space in West Berkeley. I hate to see more commercial property go off the tax rolls.” 

Caplan met with Don Yost and John Norheim, two prominent West Berkeley commercial property brokers, on Dec. 7, and the next day Sakai emailed officials Caplan, O’Keeffe and Richmond Economic Development Director Steve Duran, reporting that a Richmond site would also be considered. 

A Dec. 8 memorandum, recounting a discussion with Doug Lockhart of LBNL’s planning staff, laid out some of the facility’s requirements, including 18,000 square feet of office and conference space, two 13,000-square-foot spaces for dry and wet labs and 8,000 square feet for research support. The project would employ an operational staff of 15 to 20 and house $15 million in technology. 

The ideal site according to Lockhart would be on property now owned by Bayer in West Berkeley, adjacent to the space now rented by the lab’s Life Sciences and Physical Biosciences program in the Wareham Development-owned office building at 717 Potter St. 

The lab also expressed interest in the Peerless Lighting site. 

The lab’s second choice would be in Emeryville, but the proposed site—also owned by Wareham—was perceive to be too costly to adapt. 

Another possible site viewed with less enthusiasm was at Marina Village in Alameda, but Lockhart reportedly said the site was small, too far from Potter Street, and would cost about $300 per square foot to bring up to lab standards.. 

Two sites in Richmond were also under consideration, but one—the Campus Bay site adjacent to the university’s Richmond Field Station—was ruled out because traces of toxins evaporation from industrial waste buried at the site would “undoubtedly get into the building itself, which is unacceptable.” 

Another Bayer-owned site in Richmond, the site of the recently closed Bayer Berlex facility, was also being considered. 

At least two meetings followed with officials from the cities, the lab and brokers and developers. 

The second meeting on Jan. 4 focused on the Marchant Building, which would require a joint powers agreement involving the three cities. 

Finally, on Jan. 3, the application was sent off to Under Secretary Orbach, accompanied by the joint letter from the three mayors. 

As work on the application progressed, a partnership of two Michigan developers—Redico of Southfield and Signature Associates of East Lansing—signed a contract to buy the building from the university, according to a Feb. 20 letter from Berkeley Mayor Tom Bates to LBNL Director Chu. 

The last document provided was a March 22 email from UC Berkeley Community Relations Director Irene Hegarty to Bates and Caplan outlining the agenda for a March 26 “Chancellor’s Dinner with East Bay Mayors.”  

In addition to mayors Bates, Ron Dellums, Nora Davis of Emeryville and Gayle McLaughlin of Richmond, the event featured Keasling and, Hegarty and UCB Associate Chancellor John Cummins, Birgeneau’s chief of staff. 

The purpose of the meeting: to share plans for the EBI “and other related research at UC Berkeley and Lawrence Berkeley National Laboratory, and the potential contribution to regional economic development as well as to local energy policy and practices.”  

The aggressive nature of the research goals of both projects has been emphasized by LBNL Director Steven Chu, who compared the BP biofuel program to the Manhattan Project during a campus forum held by project supporters in late March.The Manhattan Project was a massive secret federal program directed by UC Berkeley physicist Robert Oppenheimer which led to the creation of the atomic bomb. 

Both seem to advance a deeper political agenda for the Bush Administration: using biofuels as political and economic weapons against disfavored regimes, both the oil-rich lands of the troubled Mideast and the nation of Venezuela, where Hugo Chavez, the charismatic populist president, has emerged as a leading critic of the American president.  


Next week, the Planet will run a second installment of this story, focusing on the Bush administration’s agenda on biofuels.