Partnerships drive biofuels and other alternative fuels to scale

A new report from Lux Research maps the web of partnerships driving innovation in alternative fuels to help start-ups and corporations navigate the road to  commercialization.

Bringing new alternative fuel technologies like biofuels to scale poses technical, financial, and market hurdles that few companies – large or small – can tackle alone. Not surprisingly, the industry has already seen a wave of strategic partnerships form to navigate these challenges. The breakaway success stories yet to be written will be based on partnerships that bridge remaining inefficiencies in the value chain, and capitalize first on emerging opportunities, according to a new report from Lux Research.

The report, titled “Partnerships Weave the Alternative Fuel Innovation Web,” analyzes the industry along value chains linking feedstock sources, conversion technologies, and end-use applications. Further, it provides a framework to assess and implement future partnerships that support successful development, scaling, and commercialization strategies.

“In order to survive and thrive, alternative fuel developers need to identify the well-connected current leaders as well as the fast risers in their particular value chains,” said Andrew Soare, a Lux Research Associate and the report’s lead author. “The web of industry partnerships that this report lays out will help readers spot these strategic connections, and determine where they’re best able to find or provide solutions to the technical, financial and market challenges ahead.”

To conduct its analysis, Lux Research constructed a map of industry relationships, drawing on its database of alternative fuel companies as well as more than 20 interviews with various stakeholders in the industry. Among its key findings:

  • Partnerships will benefit large and small players alike. Corporations and startups hoping to bring alternative fuels to scale will need to partner frequently and broadly to remain competitive. Startups need corporate money, market pull, and scale-up know-how to grow, while corporations need startups to fuel their open innovation models and access new technologies, markets, and industries.
  • Emerging partnerships will link multiple industries. Corporations in agriculture, energy, waste, chemicals, and other industries are forging partnerships to forward alternative fuel technologies. Early examples include the joint ventures connecting DuPont and BP, Chevron and Weyerhaeuser, and ADM and ConocoPhillips, or the mutual investment partnerships between Waste Management and Valero, or Honda, Cargill, and Shell.


  • Partnerships will deepen as the industry matures. As early technical challenges are met and milestones reached, corporate partners will shift resources from technology development to commercialization mode – dropping less promising alliances to focus on partners and technologies most likely to bring them to market.

“Partnerships Weave the Alternative Fuel Innovation Web,” is part of the Lux Alternative Fuels Intelligence service. Clients subscribing to this service receive ongoing research on market and technology trends, continuous technology scouting reports and proprietary data points in the weekly Lux Research Alternative Fuels Journal, and on-demand inquiry with Lux Research analysts.

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