Massachusetts Executive Office of Environmental Affairs

MASSACHUSETTS ENVIRONMENTAL VENTURES

Quarterly Newsletter About the Massachusetts Strategic Envirotechnology Partnership

Viewpoint
MARKETWATCH
MEV 15 Companies
U.S. Water Industry: 1996 - 2000
STEP Firms Fill New Technology Niches
Massachusetts Developments
Company Updates

VIEWPOINT

Halting Climate Change: A Role for Big Oil in Tech Innovation?

By David Levy
Department of Management and Marketing
UMass-Boston

The fossil-fuel industry has taken the lead in opposing any international agreement calling for strong measures to reduce greenhouse gas emissions. Yet the oil and gas companies could soon be playing a different leadership role: as major players in efforts to accelerate the development of alternative energy technologies.

The Kyoto Protocol-the agreement reached last December by more than 150 nations at the Third Conference of the Parties (COP-3) to the Framework Convention on Climate Change-specified some surprisingly aggressive goals for greenhouse gas reductions by the period 2008 to 2012. In particular, the United States, which had previously committed only to reduce its emissions to 1990 levels, finally agreed to reductions of 7 percent below 1990 levels. The European Union nations went further, agreeing to an 8-percent reduction in emissions compared with 1990 levels, while Japan committed to a 6-percent reduction, and other industrialized nations committed to reductions of about 5 percent.

The Global Climate Coalition (GCC), an industry association of oil, automotive, and other businesses, reacted to the recent Kyoto Protocol with alarm, warning that the pro-tocol's targets for reducing greenhouse gas emissions will cause widespread economic harm with dubious environmental benefit. Prior to the COP-3 conference, GCC had persuaded other groups, including some labor unions, agricultural associations, and senior citizen organizations, to join in its multimillion-dollar campaign against initiatives for reducing greenhouse-gas emissions.
Even before Kyoto, however, major cracks had begun to appear in this campaign. In May 1997, John Browne, chief executive officer of British Petroleum (BP), gave a landmark speech at Stanford University in which he acknowledged the seriousness of the global climate change problem and pledged that his company would take steps to address the problem. While its U.S. arm remains a member of GCC, BP has made major investments in alternative energy technologies and expects to boost its revenues from solar panels to $1 billion annually over the next ten years. Royal Dutch Shell has said that it will spend about $100 million per year over the next five years in a similar effort.

These commitments by BP and Shell and comparable commitments by other energy companies such as Enron, whose reserves primarily consist of gas rather than oil, may be the spark that prompts the fossil-fuel industry to become major investors in technologies for capturing renewable energy sources and improving energy efficiency. These investments are likely to take two forms: acquisitions of smaller, innovative energy technology companies; and the internal development of the required engineering and technical skills.

The development of alternative energy technologies could use the financial muscle that the oil and gas giants can provide. Renewable energy sources have long trajectories for price competitiveness with fossil fuels. For example, the price of the photovoltaic (PV) systems that convert solar energy to electricity has been falling at a steady rate of about 15 percent per year.
Alternative energy technologies could use the muscle that the oil and gas giants can provide.
Without massive investment, however, PV technology is not expected to be cost-competitive with fossil fuels for general supply until after 2020. Wind energy is already competitive in some locations, but the rate of decrease in cost is much slower than that for PV technology.

The Clinton Administration has shown interest in jump-starting technologies for reducing greenhouse gas emissions through tax incentives and direct federal investment. But while the Kyoto Protocol represented a major new chapter in the book on human-induced global climate change, the role of the U.S. government and other governments in spurring new technology remains uncertain.

The U.S. Senate has indicated that it will not ratify the protocol at least until the developing nations have also made some commitment to reduce their greenhouse-gas emissions. And while budget-deficit pressures have eased in the United States, science and technology funding has not been high on the list of priorities for spending any projected budget surplus.

The fossil-fuel industry, particularly in the United States, is not likely to jump quickly at the opportunity to invest in renewables and energy efficiency. Nevertheless, the industry is in a difficult position. Somewhat like the tobacco companies, the oil companies face the prospect of large profits for another 20 years and expanding opportunities in developing countries, but long-term clouds hang over the industry. Also like the tobacco companies, the oil companies could pursue a two-pronged strategy: engage in diversification, while pursuing political campaigns to delay any effort to restrict fossil-fuel consumption.

Diversification of their energy portfolios will be difficult for the fossil-fuel companies to achieve internally. The core competencies in the fossil-fuel arena are fundamentally different from those in the alternative energy domain. Oil extraction and refining require technical and engineering expertise in hydrocarbon chemistry, geology, and continuous-process manufacturing.

Technologies for exploiting renewable energy sources and improving energy efficiency rest on completely different technological foundations. PV technology, for example, is based on silicon semiconductor technology, while wind power is based on aerodynamics, turbine technology, composite materials, and electronic controls.

Yet the fossil-fuel industry does not have to reinvent the wheel. Pioneers in the alternative energy fields are plentiful, and the oil companies have the financial resources to bring them on board and accelerate the development of alternative-energy technologies. Indeed, despite the risks involved in developing these new technologies, few oil companies will want to take the risk of falling behind while BP and Shell move out ahead of the pack.

Water Market Enjoys a Rising Tide

Until a few years ago, water quality represented a relatively unexciting sector in the environmental industry. In the late 1980s, the water sector's modest performance paled in comparison to the annual growth of more than 20 percent enjoyed by the analytical services, consulting and engineering, hazardous waste management, and site remediation/construction sectors. However, as the spectacular growth of these once-hot industry sectors has slowed-and in some cases, reversed-during the 1990s, the slow but steady growth of the water market has encouraged investors and entrepreneurs to take the plunge.

Massachusetts companies, both large and small, have joined in the rising opportunities in the water business. Industry leaders like Ionics, Inc. (Watertown) are expanding their array of products and services and are diving deeper into international markets. Even small startup companies, such as SolmeteX (Billerica), are testing the waters, offering new technologies in hopes of securing their niche in the marketplace.

Vast, Fragmented Market

The water-quality sector is vast, currently accounting for more than 40 percent of the total revenues of the U.S. environmental industry. Environmental Business International (EBI), a consulting and market research firm in San Diego, California, has estimated that total U.S. water revenues in seven business segments reached about $74 billion in 1996. Two of these segments-water utilities and wastewater treatment-accounted for more than two-thirds of this total, with revenues of $26 billion and $24 billion, respectively.

The water equipment and chemicals segment accounted for an additional $16 billion (22 percent) of the total revenues, followed by consulting and engineering services (including contract operations), with $5 billion (7 percent); "full-solution" or "total water" companies, with $1.4 billion (2 percent); instruments, with $570 million (1 percent); and analytical services, with $410 million (1 percent). In addition, EBI has projected that, while much of the environmental industry will struggle to increase revenues during the late 1990s, the water-quality sector will grow by a healthy 5 percent annually, reaching nearly $90 billion by the year 2000.
Industry analyst Joan Berkowitz of Farkas Berkowitz & Co. (Washington, D.C.) recently noted that, while the U.S. water-quality market is mature, it is undergoing a sea change as a result of several major trends. To cut costs, a growing number of cities are hiring private contractors to operate and maintain their municipal water systems. Likewise, many industries are outsourcing their water and wastewater operations, particularly when they need to expand or upgrade their facilities.

Rampant Consolidation

The overall water market is consolidating. Some companies have grown by acquisition into total-water companies, which offer "one-stop shopping" for a broad range of water equipment and services to industries, municipalities, and homeowners. These firms are buying up everything from new technologies to water rights in an effort to expand their business and gain a competitive edge. Other firms are forming strategic alliances to improve their market position. Finally, companies are venturing abroad in an increasingly global marketplace.

Massachusetts firms have been major players in this changing water sector, often leading the way in product development, business partnerships, and global marketing, or serving as attractive targets for acquisition. For example, two of the nation's top 16 water equipment firms-Ionics and Koch Membrane Systems-are headquartered in the state, while other industry leaders, such as Waterlink, have acquired Massachusetts companies as part of their growth strategy.

"Total Water" Companies

United States Filter Corp. (Palm Desert, California) has been a pioneer of the "total water" concept, acquiring more than 75 U.S.-based and international companies since 1991 to become the world's largest integrated water company. U.S. Filter's revenues have skyrocketed from $23 million in its 1991 fiscal year to $1.4 billion in the 1997 fiscal year, which ended last March. Recent acquisitions have brought its annualized revenues to about $4.5 billion.

Although much smaller than U.S. Filter, Waterlink (Canton, Ohio) is another leader in the total-water market. Founded in December 1994, Waterlink has grown rapidly through a series of acquisitions into a full- service water and wastewater treatment company, with annual revenues that totaled $73 million in 1996 and that will likely reach at least $120 million in 1998. The company began its acquisition spree with the purchase of Massachusetts-based Sanborn Technologies (Medway), a maker of industrial-separation and coolant-recovery systems. Waterlink has also acquired Mass Transfer Systems (Fall River), which supplies jet aeration and mixing systems to industries and municipalities worldwide. Waterlink raised a total of nearly $44 million in an initial public offering last summer.

Ionics, Inc. has followed a different business strategy, focusing largely on its membrane-based filtration technology and related products and services for water purification, treatment, and analysis. With 1996 revenues of about $327 million, Ionics is the nation's third largest maker of water and wastewater equipment. Ionics has achieved a high growth rate-20 percent annually during much of the 1990s-by investing heavily in R&D to continually improve its filtration technology, and by offering a growing array of services to its customers. The company has also made selective acquisitions to solidify its technology base. For example, in October, Ionics acquired the Watertec Group (Brisbane, Australia), a family of water-treatment companies. Watertec is a major manufacturer and supplier of ozonation water disinfection systems-a technology not previously offered by Ionics.

Ionics has also been a leader in building, owning, and operating water systems for industrial customers and municipalities. The company has entered into long-term contracts to supply ultrapure water to chemical producers, electronics manufacturers, fossil-fuel plants, and nuclear power facilities. Recently, Ionics teamed up with an electric utility, Progress Energy, to design, build, and operate a desalination plant in Tampa Bay, Florida.

Alliances Abound

Ionics is one of a growing number of Massachusetts companies that are forming strategic alliances to compete in the contract operations segment of the water market. In May, CDM Philip-a joint venture of Camp Dresser & McKee (Cambridge) and Philip Services Corp. (Hamilton, Ontario)-won a contract to design and build a water treatment facility for the city of Seattle, Washington, and operate the plant for 25 years. The $118-million contract is the largest ever awarded for a water-treatment design, build, and operation project in North America. The new plant will use advanced filtration technologies and a compact infrastructure to reduce construction and operating costs.

The project places CDM Philip in an excellent competitive position in the $1-billion contract operations market for municipal water systems. According to Farkas Berkowitz, total revenues from contract operations at such facilities have been increasing at a rate of 20 to 30 percent annually, and could accelerate further as a result of recent tax changes that are more favorable for long-term operation and management contracts at municipal water systems.

International Opportunities

Many U.S. companies have increased their bottom line by marketing their water-quality products and services abroad. EBI has projected that, for U.S. Filter, international sales will account for about 30 percent of the company's total revenues during 1997, reflecting a steady increase from just 12 percent during 1994.

Wakefield-based Metcalf & Eddy, a design/build engineering company, recently formed a strategic alliance with BetzDearborn, a water chemicals maker, to provide water management services to industrial customers worldwide. The venture, which is called FirstChoice, will seek contracts to build, own, operate, and maintain water and wastewater facilities. Metcalf & Eddy will handle the engineering, construction, and site management for the venture's projects, while BetzDearborn will be responsible for sales and marketing, as well as chemical treatment.
Ionics has established manufacturing facilities, field-service operations, and sales offices in Africa, Asia, Australia, Europe, the Middle East, and Latin America. The company has installed more than 3,000 of its water and wastewater treatment systems in over 60 countries. Last year, Ionics derived about 36 percent of its total revenues from international business.

Ionics is continuing to expand its global business through acquisitions and joint ventures. For example, during 1996, Ionics acquired Aqua Design, Inc., a company that owns and operates about 35 desalination plants in the Caribbean region. This year, Ionics acquired a controlling interest in the Malaysian company Enersave Engineering Systems, which provides water and wastewater treatment equipment and services in Southeast Asia. Similarly, the recent acquisition of the Watertec Group, described above, has given Ionics a new sales conduit for its products and services in Australia and Asia.

Although companies like Ionics and Metcalf & Eddy are facing stiff competition as they pursue business abroad, they are taking the gamble in hopes of profiting from an immense international market that some analysts expect will reach $500 billion by the year 2000.

MARKETWATCH: Spire prepares for PV take-off

Worldwide installations of photovoltaic (PV) products totaled more than 90 megawatts during 1996, an increase of 14 percent over 1995, according to the Solar Energy Industries Association. The U.S. market for installing PV modules on buildings could total $2.5 billion over the next ten years, the association says, and the Japanese and European markets for PV-module installations could enjoy similar growth.

Bedford-based Spire Corp. is ready for this explosion in the PV market. Spire, the newest member of the MEV 15 list of environmentally responsible companies based in Massachusetts, makes the full line of equipment for manufacturing PV modules. According to the company, it is the only firm providing a complete line of such equipment and has an 80-percent share of the world market for those products.

Spire replaces Molten Metal Technology, Inc. (Waltham) on the MEV 15. "We are dropping Molten Metal from the index due to its unrecoverable financial decline and replacing it with Spire Corp., a solutions-driven company based on renewable energy," said Winslow Management (Boston), which jointly developed the MEV 15 index of companies with UMass-Boston's College of Management.

Present at the beginning

The high hopes for Spire follow more than a quarter century of anticipation. Roger Little, currently Spire's chairman, founded the firm in 1969 to develop advanced solar cells for such applications as satellites. Then the oil crisis of the early 1970s prompted widespread interest in alternative energy sources. In response, Spire shifted its focus to terrestrial PV markets and developed technologies for the high-volume, low-cost manufacturing of PV modules.
According to Spire, the company has provided equipment for manufacturing PV modules at about 130 facilities in more than 30 countries. This equipment includes individual components in the manufacturing line, such as cell and module testers, cell-soldering stations, and laminators, to the turnkey production lines. The company has generated revenues totaling $17 million to $18 million during each of the past three years through its PV operations and through two other business lines-optoelectronics and biomaterials.

Recent events have only enhanced the prospects for PV technology as an alternative energy source. The Kyoto Protocol, reached last December, established some aggressive targets for reducing greenhouse gas emissions, and replacements for fossil fuel as an energy source will be critical to achieving these emissions reductions. In the United States, solar technology in particular is expected to receive a major boost from the Clinton Administration's "Million Solar Roofs Initiative," which has the goal of putting solar panels on the roofs of one million U.S. residences by the year 2010.

Spire expects that the growing worldwide interest in PV technology will stimulate a dramatic increase in the market for PV-module manufacturing equipment. According to the company, that market could grow from $20 million during 1997 to $25 million to $40 million during 1998.
Investors appear to be taking note of this market potential, and of Spire's projected revenues of $20 million during 1998. Spire's stock, which was trading as low as $5.25 per share last summer, closed at $15 per share on February 11-further indication of the company's bright future.

	MEV 15 COMPANIES (Data as of 2/4/98)
Company	Market Value $/Share	Price Change ($Millions)	PE Ratio (% YTD)	1988
Fuor Daniel GTE	9 7/16	79.0	-7.0%	23.6
Galileo	11 ½	79.1	9.5%	—
Gilette	100 5/8	56,400	0.2%	33.8
Ionics	42 3/8	677	8.3%	21.4
Millipore	35	1,500	3.1%	17
Opta Food Ingredients	4 ½	49.9	-25.0%	NM
Polaroid	42 9/16	1,900	-12.6%	15.3
Spire	15 ¼	48.8	5.2%	—
Stride Rite	11 5/16	540	-5.7%	20.9
Thermo Ecotok	19 3/8	482	6.2%	19.0
Thermo Electron	40	6,100	-9.1%	23.1
Thermo Fibertek	12 ¼	757	0.5%	21.9
Thermo Power	11	131	25.7%	28.9
Watts Industries	28 5/16	766	0.0%	14.1
Whole Foods Market	53 ½	1,300	4.6%	34.7
MEV 15	29 9/64	4,720	0.7%	22.8
S&P 500	1006.90	58,800	3.8%	20.8
RUSSELL 2000	441.84	—	1.1%	—
Source: Baseline Services	NM = Not Material	YTD = Year to Date

U.S WATER INDUSTRY 1996-2000
Business Sector	1996 Revenues ($ Billions)	Average Annual Revenues ($ Billions)	Projected Year 2000 Growth 1996-2000
“Total Water”	$1.38	$5.09	39%
Water Equipment and Chemicals
Separation Equipment	$2.30	$2.69	4%
Destruction Equipment	$1.00	$1.22	5%
Chemical Equipment	$0.37	$0.37	<1%
Delivery Equipment	$8.02	$9.03	3%
Biosolids Equipment	$1.04	$1.26	5%
Chemicals	$3.41	$3.54	1%
Subtotal	$16.14	$18.11	11.5%
Services, Consulting, and Engineering
Contract Operations	$1.10	$2.28	20%
Consulting	$1.44	$1.68	4%
Design/Engineering	$1.63	$1.98	5%
Maintenance	$1.09	$1.38	6%
Subtotal	$5.26	$7.32	9%
Instrumentation	$.057	$0.69	5%
Analytical Services	$0.41	$0.45	2%
Wastewater Treatment Operations	$24.02	$27.78	4%
Water Utilities	$26.36	$29.90	3%
TOTAL	$74.14	$89.34	5%
Source: Environmental Business International

STEP Firms Fill New Technology Niches

The growing water-quality market has plenty of room for small companies offering innovative technologies that fill specific market needs. STEP has been providing technical and business support to a number of Massachusetts-based companies hoping to succeed in the water sector, including AWT Environmental (New Bedford), Cellini Purification Systems (Ludlow), Innovative Chemical and Environmental Technologies (Norwood), and SolmeteX (Billerica).

AWT Environmental has gained the exclusive right to market Bioclere residential wastewater treatment systems in Canada and the United States. Bioclere is a biological filtration technology developed by Oy Ekofinn Ab of Lahti, Finland. AWT sells Bioclere systems in various sizes from small units designed to treat wastewater from one home to large units capable of handling wastewater generated by up to 2,000 people. The Bioclere technology is well-suited for "decentralized" sewage treatment systems, which AWT believes will become increasingly popular in the years ahead.
Cellini has been developing and marketing water purification systems for industrial uses. The company's Controlled Atmospheric Separation Technology (CAST) is an evaporative recovery system for treating and recycling industrial process water. Cellini's customers include Winchester Electronics (Watertown, Connecticut), which is using the CAST system to recover and reuse rinse water while concentrating and reducing the amount of liquid waste that must be disposed of off site.
Innovative Chemical and Environmental Technologies (ICET) is preparing to market a carbon-based sorbent system called MaxPure for removing trace metals from wastewater and drinking water. The MaxPure systems are more compact than traditional ion-exchange and activated-carbon systems with similar capacity. ICET plans to sell the systems for about half the cost of comparable ion-exchange systems. The company claims that the MaxPure technology can be readily scaled from small water purification systems for individual homes to much larger systems capable of processing 5,000 to 50,000 gallons per day of industrial wastewater.
SolmeteX has developed its Keyle:X system and related technologies to remove mercury and other heavy metals from process water, wastewater, and groundwater. The Keyle:X system uses polystyrene absorbent beads with a proprietary coating that selectively binds heavy metals. According to SolmeteX, the technology can be adapted to a variety of applications, including the treatment of wastewaters from hospitals, electronics manufacturers, mining operations, and petroleum refining operations.

MASSACHUSETTS DEVELOPMENTS

New utility deregulation law boosts funds for renewables

An estimated $150 million will be available over the next five years to stimulate the development and use of renewable energy technologies in Massachusetts, under provisions in the state's Electric Utility Restructuring Act, which became law in November. The act establishes the Massachusetts Renewable Energy Initiative, which will support the development, production, and use of a wide range of renewable and innovative energy technologies.

The initiative will be financed by a new "systems benefits charge," which will take effect in March 1998, of between $0.0005 and $0.00125 per kilowatt-hour added to the cost of electricity used by commercial, industrial, and residential customers in the state. Monies from this rate charge will be placed in a Renewable Energy Trust Fund administered by the Massachusetts Technology Collaborative (MTC), an independent, public economic-development organization based in Westborough. MTC estimates that the rate charge will generate about $20 million for the trust fund in 1998, $33 million in 1999, $45 million in 2000, $33 million in 2001, and about $20 million in each subsequent year.

The Massachusetts Renewable Energy Initiative will include both supply-side and demand-side programs, according to MTC. The supply-side programs will be designed to help researchers and manufacturers develop, commercialize, and produce renewable energy technologies in Massachusetts. The demand-side programs will focus on increasing utility and consumer demand for renewable energy technologies in Massachusetts and elsewhere. MTC is currently considering a variety of programs, including information clearinghouses for both technology developers and consumers, direct business and marketing services, technology demonstration projects, research grants, loan guarantees, and consumer loans and rebates. For further information, contact: Patrick Larkin, MTC, Tel: 508-870-0312.

ATC and partners allocate $540,000 for 8 projects

The Advanced Technology Center for Business, Textiles, and Manufacturing (ATC) at UMass-Dartmouth is supporting a total of eight applied R&D projects during FY 1998, which began on 1 July. The funding for these projects will total about $543,000, with about $320,000 contributed by ATC and the remaining $223,000 in the form of cash and in-kind contributions from industry and government research partners.

Two of the R&D projects-the eutrophication of Long Pond and the impact of wastewaters from beauty parlors-are ongoing studies that began in FY 1997 and are slated for completion this winter. The other six projects were launched in FY 1998 and are expected to continue through the end of the fiscal year. The listing below summarizes each of these ATC projects; the academic departments are all at UMass-Dartmouth.

Controlling eutrophication of Long Pond: ATC associate re-searcher Jean Fraser and five government and private research partners have been studying the excessive growth of non-native aquatic plants on Long Pond in southeastern Massachusetts, and the possible use of innovative technologies to control this problem. ATC's research partners in this study are the Massachusetts Department of Environmental Protection's Lakeville office, the Long Pond Association, the New England Aquarium, the U.S. Geological Survey's Water Resources Division, and the Water Watch Partnership.
Impact of wastewater streams from beauty parlors: Suku Sengupta of the Department of Civil and Environmental Engineering is working with Zona Salons and hair product manufacturers to identify and quantify the effects that wastewaters from beauty parlors have on wastewater treatment systems, including septic tanks and soil absorption systems. The project is evaluating several approaches for reducing the concentrations of organic chemicals in salon wastewater.
Removing heavy-metal contamination from industrial sites: Professor Sengupta and SolmeteX (Billerica) will evaluate approaches for remediating soil and groundwater contaminated with chromic acid and other heavy-metal pollutants at a plating facility in southeastern Massachusetts. As part of the project, the researchers will assess the technical and financial feasibility of using SolmeteX's Metall:X technology for such cleanups.
Monitoring groundwater for BTEX compounds: Heather Miller of the Department of Civil and Environmental Engineering and industry partner ORS/Sippican (Marion) will evaluate the use of the company's ChemSensor for the assessment and long-term monitoring of sites contaminated by leaking underground storage tanks. In particular, the researchers will compare Chem-Sensor measurements of BTEX compounds (benzene, toluene, ethyl benzene, and xylene) with data obtained from conventional well-purging procedures.
Screening sites for TCE contamination: UMass-Dartmouth's Heather Miller and ORS/Sippican will undertake a project to evaluate the use of the company's AccuSensor for measuring levels of trichloroethylene (TCE) in groundwater. The project will assess the precision and accuracy of AccuSensor measurements in comparison to similar readings obtained through gas chromatography.
Research on ground-source heat pumps: UMass-Dartmouth will establish a research and development center for the design and testing of ground-source heat pumps (GSHPs). Ron DiPippo of the Department of Mechanical Engineering and Steve Nardone of the Department of Electrical and Computer Engineering will develop and test prototype GSHP components and related instrumentation in cooperation with industry partners J.A. Busa Air Conditioning and Refrigeration (Lexington) and Heat Transfer Products (East Freetown).
Monitoring and controlling wastewater treatment systems: Lee Estes and Gil Fain of the Department of Electrical and Computer Engineering will work with industry partner AWT Environmental (New Bedford) to develop instruments for remotely monitoring and controlling AWT's Bioclere On-Site Wastewater System. One of the major goals of this multiyear project is to ensure that the Bioclere system operates successfully and meets regulatory requirements for wastewater treatment.
Using acoustic sensors to detect pollutants: David Brown of the Department of Electrical and Computer Engineering, Bal Ram Sing of the Department of Chemistry, and Heather Miller will work with three industry partners to study the use of acoustic techniques for detecting pollutants in liquids. As part of the project, the UMass-Dartmouth researchers will also establish an Environmental Sensor Laboratory to help its industry partners—Benthos (North Falmouth), Camber (Easton), and Physical Sciences, Inc. (Andover)—develop and test acoustic and fiber-optic sensors.

For further information on these projects, contact: Dan Murphy, ATC, Tel: 508-999-9121.

STEP and TURI fund 8 sustainable tech projects

STEP and the Massachusetts Toxics Use Reduction Institute (TURI) at UMass-Lowell have awarded eight grants totaling $170,000 under their new University Research in Sustainable Technologies Program. STEP and TURI established the program to support the research, development, and evaluation of sustainable technologies that are both economically and environmentally sound.

The following list summarizes the sustainable technology projects; the academic departments given are located at UMass-Lowell unless otherwise noted.

Alternative-fuel systems for buses ($24,000): John Duffy of the Department of Mechanical Engineering and industry partner Kaman Electronics will study the feasibility of producing alternative-fuel buses in Massachusetts. The researchers will evaluate a number of power options for buses, ranging from compressed natural gas to hybrid fuel cell, flywheel, and battery systems.
Enzyme-catalyzed modification of soy proteins ($17,000): Richard Gross of the Department of Chemistry and industry partners Altus Biologics, Foster-Miller, and Polaroid Corp. will study enzyme-catalyzed techniques for making biodegradable surfactants, emulsifiers, and degreasing agents from soy proteins. The project will also evaluate whether chitosan-a shellfish waste product-can be used as a feedstock for the catalysis process.
Alternatives to PVC in medical applications ($25,000): Stephen McCarthy of the Department of Plastics Engineering will work to develop economical and environmentally benign plastic materials to replace polyvinyl chloride (PVC) in medical applications. McCarthy will work with researchers from the Lowell Center for Sustainable Production, UMass-Worcester, Boston Scientific, C.R. Bard, and Pfizer to evaluate different PVC alternatives.
Predicting hydrogen bonding of solvent-polymer pairs ($22,500): Steven Warner and Armand Lewis of UMass-Dartmouth's Department of Textile Sciences and researchers from the Massachusetts Office of Technical Assistance will attempt to develop a new, more reliable model for predicting the hydrogen bonding characteristics of solvent-polymer pairs. A more reliable model would help companies evaluate and select "green" substitutes for some of the toxic and ozone-depleting solvents currently in use.
Properties of noncovalent hydroquinone derivatives ($21,500): John Warner of UMass-Boston's Department of Chemistry will use molecular modeling to study the formation and physical properties of non-covalent hydroquinone derivatives. These environmentally benign compounds are produced through a "green chemistry" process that does not rely on conventional solvent-based organic synthesis.
Solid-state heater and cooler ($10,000): Ziyad Salameh of the Department of Electrical Engineering and industry partner Solectria will design, build, and evaluate a portable battery-powered, solid-state heater and cooler. Potential applications for the device range from a heating and cooling system for electric cars to portable storage systems for transplanted organs, medicines, and electronic equipment.
Additive technologies for fabrication of printed wiring boards ($25,000): Sammy Shina of the Department of Mechanical Engineering and four industry partners-Altron, Inc. Parlex Corp., Hadco Corp., and Tri-Star Technologies-will evaluate the costs, electronic and mechanical characteristics, quality, and reliability of PWBs fabricated with additive technologies, compared to PWBs made with conventional subtractive technologies.
De-inking system for waste paper ($25,000): John Walkinshaw of the Department of Chemical Engineering will develop and test an ultrasonic-assisted system for removing inks during the recycling of office waste paper. Unlike current de-inking systems, the ultrasonic-assisted technology should be able to remove the toner inks from copy machines and laser printers without degrading the quality of paper fiber.

For further information about these sustainable technology projects, contact Liz Harriman, TURI, Tel: 978-934-3387.

Company Updates

A joint government-industry research team that includes Cambridge-based Arthur D. Little, Inc. (ADL) recently announced that they have successfully demonstrated the first fuel-cell engine capable of using gasoline or alternative fuels to produce electricity. The system reportedly extracts twice as much useful energy from gasoline as an ordinary car engine, while reducing air pollution by about 90 percent. ADL and its project partners-the U.S. Department of Energy (DOE) and Plug Power (Latham, New York)-claim that the fuel cells could be used as low-pollution power sources for cars and other vehicles, homes, and industrial facilities, as well as for portable power systems.

According to ADL, gasoline-powered fuel-cell vehicles could be refueled in a few minutes at a corner gas station, in contrast to battery-powered electric vehicles, which typically take hours to recharge. The fuel-cell system can also use gasohol, ethanol, natural gas, or propane for fuel. DOE has awarded ADL and Plug Power an additional $15-million cost-shared contract for further development of the technology. ADL Vice President Jeffrey Bentley expects that a prototype vehicle using the fuel-cell technology could be developed and tested within five years. For further information, contact: Randi Alterman, ADL, Tel: 617-498-5119.
Tri-Star Technologies Co. (Methuen) has substantially reduced its waste generation and net manufacturing costs by installing an electrolytic system to regenerate spent cupric chloride etching solution from the fabrication of printed wiring boards (PWBs). By replacing its older chemical regeneration system with the new unit, Tri-Star has cut its hydrochloric acid use by 90 percent, nearly eliminated its use of 50-percent hydrogen peroxide, and eliminated the bulk hazardous wastes that would otherwise have to be shipped off site for recycling. In addition, the company is able to recover and resell about 40,000 pounds per year of metallic copper that is ordinarily lost in the chemical regeneration process.

Although the electrolytic process has some added maintenance and electricity costs compared with the chemical approach, these are more than offset by income from copper resale and savings from reduced chemical use and hazardous waste disposal. Tri-Star has estimated that switching from the chemical to the electrolytic system will save the company about $80,000 a year. For further information, contact: Ed Gomes, Tri-Star Technologies Co., Tel: 978-686-0266.
In September, the National Recycling Coalition (NRC) selected Walden Paddlers, Inc. (Concord) to receive NRC's 1997 award for "outstanding recycling innovation." Walden Paddlers was established in 1992 with the express purpose of producing kayaks from recycled material. The kayak hulls and seats-which together account for over 95 percent of the boat's mass-are made entirely of recycled high density polyethylene (HDPE). In announcing the award, NRC noted that Walden Paddlers is the only paddle sports manufacturer in the world that makes kayaks with post-consumer HDPE. Walden Paddlers' kayaks are also reportedly lighter and have better hull performance than other kayaks of similar size, according to NRC.

Another Walden Paddlers innovation is the company's development and application of completely reusable packaging for all of its boats. The company has designed and produced these packaging materials in cooperation with TMC, Inc. (Manville, Rhode Island). In its latest venture, Walden Paddlers has developed an all-purpose automobile roof rack made with recycled HDPE. For further information, contact: Paul Farrow, Walden Paddlers, Tel: 508-371-3000.
Zero Stage Capital (Cambridge) has provided $1 million in venture capital financing to Zero Emissions Technology (ZET), based in Portsmouth, New Hampshire, to aid in the company's development of innovative air-pollution control technology for industrial applications. ZET's first product, the Arc Snubber Filter, improves the collection efficiency of electrostatic precipitators (ESPs), which remove fine particulates from industrial emissions.

To date, ZET has installed Arc Snubber filters at about 25 coal-fired power plants and pulp and paper facilities, according to the company's marketing director Stephanie Procopis. ZET is now pilot-testing two related products: the Arc Snubber power supply, which improves ESP performance, and the SOx Converter flue-gas conditioning system, which enhances ESP particle collection at facilities that burn low-sulfur coal. ZET is also refining its proprietary Acid Capture Technology, which would remove nitrogen oxides, sulfur dioxide, and particulates from combustion. For further information, contact: Stephanie Procopis, ZET, Tel: 603-430-1116.

MASSACHUSETTS ENVIRONMENTAL VENTURES - The Quarterly Newsletter of the Massachusetts Envirotechnology Partnership (STEP) - is published for the business community by the Environmental Business and Technology Center located at the College of Management, University of Massachusetts-Boston. The STEP program is an innovative effort begun in 1994 by the Massachusetts Executive Office of Environmental Affairs, the Department of Economic Development, and the University of Massachusetts to promote the growth of new environmental and energy-efficient technologies in Massachusetts. Inquiries and contributions for publication are welcome. Publisher: William J. Brah, Director, Environmental Business and Technology Center; Managing Editor: George Stubbs; Contributing Editors: Eric Brus and Ivan Rudnicki; Production: Lisa Jasak; Editorial Advisory Board: Eric Hayden, Dean, College of Management, University of Massachusetts-Boston; Tom Churma, Vice President, University of Massachusetts; Richard Golob, President, World Information Systems; and Gina McCarthy, Director, Massachusetts Toxics Use Reduction Administrative Council. For further information, please contact: University of Massachusetts-Boston, College of Management, 100 Morrissey Boulevard, Boston, MA 02125-3393; Tel: 617-287-7723; Fax: 617-287-7757 or Email: brah@umbsky.cc.umb.edu

Massachusetts Executive Office of Environmental Affairs

MASSACHUSETTS ENVIRONMENTAL VENTURES

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