This story was first published in YaleE360 and is reproduced here as part of the Climate Desk collaboration.
Tom Jeffries and Tom KelleherIn the 1970s, Jeffries and Kelleher met at Rutgers University while they were studying industrially useful microbes. Jeffries was later to lead a U.S. Department of Agriculture yeast genomics program. Kelleher worked for decades in the biomedical sector, working with biologics such as insulin. These biologics are made by genetically modified microbes that ferment in huge, fermenting vats. The National Science Foundation grant enabled them to reunite in 2007 and build a company together. Called XylomeThe Wisconsin-based startup aimed at finding better ways to produce low-carbon fuels using yeast agricultural waste.
It was an accident that Jeffries & Kelleher turned their efforts to a different global environmental issue a few years later: palm oil.
The world’s cheapest and most widely used vegetable oil, palm oil production is a Primary driver Deforestation and biodiversity loss in tropics. These and other problems in the palm oil industry such as exploitative labor practices have prompted years-long interest in more sustainable options. Good alternatives are difficult to find. Other vegetable oils have the same drawbacks as palm oils, and sustainable forest practices are not always efficient in the face of increasing demand. Today, nearly 70 million metric tons are consumed annually in the world. This oil is used in everything, from toothpaste and oatmilk to biodiesel or laundry detergent. The demand is expected to increase. More than twice the amount by 2050.
Xylome is one of many companies that have created microbial oils to replace palm oil, despite bioengineering advances and growing concerns about sustainability. They join numerous other synthetic biology companies—from ventures hawking new Biofuels and fertilizer for lab-grown meat—that aspire to solve environmental problems but share similar challenges scaling up production and demonstrating their approach is in fact more sustainable than the problem they’re trying to solve.
A startup called C16 Biosciences opened a gleaming new lab in Manhattan to develop a microbial palm oil alternative, backed by $20 million from Bill Gates’ climate solutions investment fund Breakthrough Energy Ventures. A startup based in California called Kiverdi is also working to manufacture yeast oil using carbon captured from the atmosphere, and a team University of Bath bioengineers are hard at work developing their own strain of oily yeast. Xylome recently sent the first batches of its palm oil alternative—called “Yoil”—to a number of large palm oil suppliers and the FDA for testing.
Although it is difficult to scale up production at a rate that is competitive with cultivated palm oils, and there are still questions about how the emerging biotech industry might impact palm-oil-based livelihoods in South Asia, Africa, and Central America, these microbial oil could help stop the unstoppable growth in oil palm, which is threatening biodiverse regions along frontiers in South and Southeast Asia as well as Central America and Africa. If yeast oils can achieve a price low enough to compete with the trees (a big if) “that would make a huge difference in where palm oil comes from,” said Kelleher, now Xylome’s CEO. “It would all be microbial at that point.”
According to a 2018 study, palm oil production accounts for less than 1% of global deforestation. Report from the International Union for Conservation of Nature, it is a major cause of deforestation in the tropics. Oil palm cultivation has been responsible in Borneo for more that half of all deforestation during the past two decades. Future demand could lead to more deforestation. According to the same report, oil palm cultivation could threaten more than 1,000,000 square miles of biodiversity hotspots. This could potentially affect more than 40% of all threatened bird, mammal and amphibian species, including orangutans, tigers, flycatchers, and elephants. Deforestation can also lead to the loss of biodiversity. greenhouse gas emissionsAs carbon-rich peat is removed from beneath virgin forests, trees are burned to make way for new growth.
Recognizing these impacts, suppliers—working through organizations like the Roundtable on Sustainable Palm Oil (RSPO), which has certified palm oil supply chains since 2007—have sought ways to increase oversight of palm oil production to ensure crops are not cultivated on biodiverse or carbon-rich land. Janice Lee from Nanyang Technological University in Singapore, an environmental scientist who studies palm oils, stated that although certifications are increasing in number, there are limitations to the system. It can be difficult to certify smallholder growers who collectively produce the majority of palm oils in some regions. “Certification is not a silver bullet,” she said. RSPO has certified about 20% of palm oil production.
It has been even more difficult to find an alternative to palm oil. Other tropical oils—like coconut oil—have lower yields than oil palm and would have even greater impacts if cultivated on the same scale. Other non-tropical oils—like soy or corn oil—can be grown outside the biodiverse tropics, but they require additional processing to replace palm oil in many applications. This processing is costly and can produce trans fats which were banned by the FDA in the United States in 2015.
Jeffries and Kelleher decided to market their yeast as an alternative. Their lab produces an oil that has a lipid profile nearly identical to palm oil. The “bugs,” as they refer to the yeast, can also be fed with materials that don’t require tropical agriculture, such as corn or sugar cane, or waste materials, like corn husks and wheat stalks, which could substantially reduce production costs. The microbial oils can also be made anywhere, which reduces the distance between factory & consumer.
The challenge has been getting the yeast to juice out oils at a scale and price that can compete with conventional agriculture—and to do it quickly enough to curb destructive oil palm development. Technology advancements could help. C16 Biosciences in Manhattan is optimizing conditions for genetically modified yeast strains. Christopher Chuck, a chemical engineer from the University of Bath, works on more productive yeast strains. But rather than alter the microbes using gene-editing tools his team uses directed evolutionary. This involves exposing yeast colonies and allowing them to experience a variety of stresses that will encourage them to produce more oil from lower-cost feedstocks. Chuck said that this approach can help to create more robust microbes. It also avoids the regulations that govern genetically altered organisms.
Xylome is the owner of patents on methods for genetically modifying yeast species. Lipomyces starkeyi, is working to increase its corn sugar-fed variety’s yield. Kelleher claims that a second strain under development can be fed with ethanol production waste products to produce oil. Kelleher claims this could eventually yield an oil at half of the current price for raw Malaysian palm oils. Decades of past research on using such fibrous, “cellulosic” feedstocks for biofuel has shown this to be an elusive target, but Kelleher and Jeffries are confident the company can get this approach to work. “The cellulosics are going to eventually prevail,” said Jeffries.
Jeffrey Linger, a bioengineer with the National Renewable Energy Laboratory, said that developing microbial oil alternatives is worth exploring. However, he believes that these companies have a long way to go before they can develop viable strains that can be produced at large scales and that can use cellulosic inputs. “There are so many knobs you can turn, so I don’t want to say it’s impossible,” he said. “I also don’t want to say it’s easy.”
Even with better strains, there is a limit to how far the microbes will go. You can find out more about our products here. “limits-of-science” model, Chuck’s group envisioned a way microbial oils might reach price parity with palm oil in the future. They discovered that even in the ideal scenario, microbial oil would still be more costly than cultivated palm oils, and that microbial oils could be up to four times more expensive. “I don’t know who is going to pay for that,” commented Lee. But, there’s more. Co-products that are valuable such as amino acids or proteins could be manufactured along with the oil, microbial oils could plausibly compete with traditional palm oil, Chuck said. It might not be as important to price if consumers are more concerned about the environment and are willing pay more for palm oil-free products.
Chuck stated that microbial alternatives must be incorporated into regulatory policies to reduce the use of palm oil from unsustainable production and help producing countries diversify their economies in order to make them viable. Subsides or carbon taxes may also improve prospects for yeast oil production, as the carbon footprints of microbial oils are likely to be smaller than palm oil grown on deforested lands. However, the entire life-cycle emissions from yeast oils have not been assessed. Study in detail.
“How do we make sure we aren’t replacing one terrible thing with another?” said Chuck.
Sara Cowling, a spokesperson of the Roundtable on Sustainable Palm Oil, stated in an email that palm oil production has to be controlled long before any microbial oils are made available. “Our stance remains that palm oil can and should be produced sustainably.” Diana Chalil, founder of the Consortium Studies of Smallholder Palm Oil in Indonesia, added that future deforestation could also be prevented by helping smallholder growers to increase the yield of their existing oil palm crop.
Indeed, with 70 million metric tons of oil produced each year, there’s room for more than one solution. Microbial oils would not have to replace all or even most of traditional palm oil production to have significant environmental benefits, Chuck said. They would just have to curb growth in the industryAnd could start by replacing palm oil in more expensive products, such as cosmetics, which is the strategy companies like C16 Biosciences and Xylome are pursuing.
“I don’t think we’re going to disrupt what they’re producing today at all,” said Kelleher. “We really represent an alternative for the growth of the industry.”
It could be the beginning of a not so-cosmetic transformation.