Virent raises $7.5 million in venture funds

Virent Energy Systems of Madison has raised $7.5 million in venture capital for continued development and commercialization of its system for turning biomass into hydrogen and gas that can be used to power engines and create electricity.
The financing round was led by Cargill Ventures, the venture capital arm of the global agri giant. It also included Honda Strategic Ventures, the investment arm of the automaker, as well as Madison-based Venture Investors, and St. Louis-based Advantage Capital Partners.
Venture Investors last year led a round of $1.4 million in seed funding for Virent, and the company has raised millions in grant money, as well.
"The investments from Cargill Ventures and Honda Strategic Ventures give Virent's technology tremendous global leverage in the emerging biofuels and hydrogen markets," Virent CEO Eric Apfelbach said in a statement.
Virent, a UW-Madison spin-off, has a pilot project going with Madison Gas and Electric Co. in which one of its fuel cell systems is turning soybean and corn byproducts into a mixture of hydrogen and components of natural gas that burns very cleanly with few emissions. The demonstration unit produces 10 kilowatts of power, enough to light about five homes, that flows into the power grid for MGE.
It is the world's first effort to use renewable sugar as a fuel for a distributed power system.
Virent's "Aqueous Phase Reforming" process uses a small amount of heat to create hydrogen, fuel gas, some liquid fuels and high value chemicals from biomass. The process can be used for distributed power systems, fuel stations, centralized fuel production or, longer term, mobile applications.
Ultimately, businesses or homeowners could buy biomass-powered hydrogen fuel cells and auto owners could use the systems to create hydrogen fuel at home for their hydrogen vehicles.
"Virent's technology is revolutionary in its simplicity," Paul Bieganski, managing director and chief technology officer of Cargill Ventures, said in a statement. "It allows abundant, bio-based renewable fuels to be used easily and cost-effectively with existing as well as future energy technologies."
Virent, which has about 20 employees, was founded in 2002 by Dr. Randy Cortright and Dr. Jim Dumesic of the UW. It is located in the Technology, Education and Commerce (T.E.C.) Incubator Center across from Madison Area Technical College. The company plans to add employees and expand its space in the next year.
Published: June 12, 2006