PlasMerica focuses efforts on renewable propane

The United States’ energy market is evolving.

New energy sources and fuels are becoming more predominant; government regulations are changing the way fuel is manufactured and utilized by end users; and a drive toward “clean energy” is omnipresent throughout the market.

Propane’s position in this evolving world is unique.

Despite being a clean-burning fuel, propane’s relationship with fossil fuels puts LPG in what most energy activists consider a dirty fuel category. The conversation regarding energy sources is binary: You’re either clean or dirty. Because of propane’s fossil fuel roots, it’s lumped into that dirty category. To break the mold, the propane industry is in the process of exploring a renewable component – a crucial step to entering the “clean” category.

One company pushing the technical boundaries of renewable propane is PlasMerica. The Newport Beach, California-based technology company developed, and continues to improve, a process that converts methane gas into clean, renewable propane.

“We think we have a product that economically makes sense and, most importantly, makes sense to the environment,” says Jerry Pellizzon, CEO and co-founder of PlasMerica.

The company’s technology earned the 2019 Innovation Award at the World LPG Association’s (WLPGA) Global Technology Conference and is starting to gain international attention. Pellizzon and Dennis Manning, chief technical officer and co-founder of PlasMerica, have found a home in the propane industry, and the two are working to forge a path for LPG in the evolving energy market.

The why

Pellizzon and Manning worked together at Ceradyne, an advanced technical ceramics company that manufactured equipment for a variety of industries, prior to its acquisition by 3M in 2014. Earlier in that year, Manning approached Pellizzon with an idea for the oil and gas industry.

“I did some preliminary investigation on the idea and found it very noteworthy, and it had a tremendous amount of merit and opportunity,” Pellizzon says. “I knew there was some risk involved, as there is with any new technology, but I’ve always enjoyed new technologies.”

Manning’s idea, as Pellizzon explains, aimed to change the molecular structure of methane to convert it from a greenhouse gas into a non-greenhouse gas with the potential to better protect the environment. For these reasons, Pellizzon was behind the cause.

“I wanted to do something that would be good for society in general,” he says. “I didn’t just want to be involved in a general technology company. I wanted to really get involved in something that had a significant impact on society. That is what got me attracted to doing something on this subject.”

Pellizzon brings executive level experience in several different industries to Manning’s extensive technical background in chemistry and chemical engineering. Combining the two minds led to the establishment of PlasMerica in August 2014.

“I really love technology and admired Dennis,” Pellizzon says. “I thought he was smart and fun to work worth and this was a venture worth pursuing. The challenge, though, was if we could actually commercialize this.”

Pellizzon explains all technology-focused initiatives need to have an economic model that can drive adaptation. This thought was ultimately crucial to PlasMerica’s success and how it found its way to the propane industry.

Today, PlasMerica’s proprietary technology converts methane from a greenhouse gas into renewable propane. This process has the potential to limit methane, a harmful gas for the environment, while creating renewable propane.

The how

PlasMerica’s intent, as Manning explains, is to use the waste product commonly omitted through flared or vented gas.

Manning explains there is technology that looks into biomethane generation and gas specification, but the end product is often biodiesel. PlasMerica aims to make biopropane its primary product.

“What we are doing is targeting the propane as the primary product and primary end point target while utilizing multiple types of feedstocks,” he explains. “We can use vented and flared gas from existing oil production as possibly a sustainable or renewable propane. We are really focused on producing propane rather than just separating it from the fossil fuel sources.”

Feedstock sources for the methane conversion, Manning says, can include fossil fuels from a refinery, ethane, biolandfill sources or fermentation plants. Methane (CH4) starts with one carbon molecule, but the company’s technology strings together three of those methane molecules to create propane (C3H8). Ultimately, PlasMerica designed its technology to make propane the primary product and limit byproducts.

“We are trying to do a very precise and controlled reaction where the focus of the reaction is to maximize the product,” Manning says. “We want to optimize the technology with a very selective product formation group so that we minimize the other byproducts. We want to be able to adjust the new material coming out of the stream of a primary composition of that of LPG.”

Keeping the focus on propane is an attractive quality to the industry’s leadership. Pellizzon and Manning made the trip to Atlanta for the 2019 National Propane Gas Association’s Propane Expo to meet with Propane Education & Research Council leadership along with attendees of the industry’s yearly gathering. Since then, PlasMerica has been welcomed by the propane industry.

“One thing we’ve observed since laying the technology out in the public is a strong pull from the LPG industry to simply use this technology for renewable or biopropane manufacturing,” Manning says.

The impact

Propane is in constant competition with other fuels in the energy market. So, positioning propane competitively against diesel and gasoline, for example, at a cheaper production cost is a major advantage to the industry.

“The value of the propane is about the same value or slightly more valued than the value of gasoline or diesel if you compare it at 1 million British thermal units,” Manning explains. “The value in propane is about the same, but the energy required to propagate propane from methane is only about 25 percent of that of going from methane to gasoline or methane to diesel.”

Manning says creating a renewable fuel is a “balance of energy economics.” Renewable diesel, for example, is the product of one additional step beyond the renewable propane manufacturing process. Manning explains the return on energy utilization decreases past the propane molecule.

“It’s a very unique attribute,” Pellizzon says about renewable propane. “It startled us at first, but it was very important to the model. Preliminary analysis of the economics says the process yields a very attractive return when that comes from methane in flared or vented sources.”

Renewable propane offers cost benefits to the end user, too.

Pellizzon explains the volatility in propane’s pricing made from oil and natural gas production is an unattractive quality to the end user. If the price of crude oil shoots up, for example, so too will the price of propane.

“What we are attempting to do is to minimize the volatility of propane’s pricing,” Pellizzon says. “We want to eliminate that and make this the most consistently priced product. Propane retailers tell us that is something their customers would really like.”

Pellizzon adds more environmentally conscious customers are attracted to the option because the process converts a greenhouse gas, methane, into a non-greenhouse gas.

Manning says companies working in the autogas sector have shown a strong interest in the technology because of the growing regulations on auto fuel. A renewable propane source, he explains, can help companies trying to meet those environmental

Outside of autogas, Pellizzon and Manning believe the technology has the potential to bring about the future success of the propane industry. It’s no question the propane industry needs to develop other sectors to secure the industry’s growth. Pellizzon thinks PlasMerica’s technology can help that cause.

“We think we have a whole new category of opportunity,” he says. “The industry needs to do something to grow. We think this technology can help that push for the industry.”

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