You're listening to the Reversing Climate Change podcast by the team at NORI, the Carbon Removal Marketplace. This is a show about the innovators and entrepreneurs developing solutions to climate change. Hello and welcome to the Reversing Climate Change podcast with Nori. I'm Ross Kenyon. I'm the head of Creative and Marketing here and one of the cofounders. Nori is a carbon removal marketplace based in Seattle, WA and a couple hours South of us.
Is an alumni Wendy Owens, CEO and founder of Hexus Biomass. Wendy, you were on the show several years ago pre COVID. It was in our old office. I must be like 2019 or something. Yeah, I think that was what it was. Yeah, and then we ran into each other at Ted Countdown in Detroit and thought we should really do an update and learn what HEXUS is is up to.
Don't worry if you're listening and you haven't heard that show, it'll reference it, but you don't need to have listen to it for this to be accessible to you, so. A lot of prologue there. Welcome, Wendy. Thank you, Ross. I really enjoyed getting down to see your test field. I enjoyed getting to see the Hexis lab and see what you're working on. As someone who doesn't have a material reality focus, it's nice to actually see people working on problems like that.
Yeah, it's it's something that I think, you know we we need now is is new types of raw material that are more sustainable than what we have access to currently. So I I appreciate you taking the time to come down and visit. I have a thesis for why raw materials do get less focused. Perhaps one is that it sounds very Soviet to me. You know, it sounds just like the idea of like we must increase iron output or something like that. Sounds like it's something that some commissar would say.
That's a silly reason, but also a true reason. But I think software, and the way that software is funded and makes people wealthy, has distorted our sense of time with regard to building new things. I think people expect that if you build a really cool prototype, you get some users. Your software company could become a Unicorn very quickly. And there's this drive for software to do everything. That's how to say that software isn't powerful and important.
But it certainly is much slower to work with things like material science, biology, chemistry. Am I on to something there? Am I reading too much into this? No, you're absolutely right. It's not something that normally happens that we come up with a new raw material. You know, the 50s in the plastic era, you know, that was new raw materials for that rubber. Before that, of course, we had
lots of wood. So integrating a new raw material into the existing supply chain is it takes a little bit of effort and a little bit of time. But right now with this new bioeconomy, let's just call it, it's really commodities based. So we're looking at changing the way we use plastic and using less of it, using more sustainable materials. There's this whole question about wood as a raw material and its value and cutting trees and deforestation and so forth. So I think it's relevant to look
at this. We have to look at this economy in a different way than we looked at more of the high tech economy with software and such. No, it's not going to move as quickly, but we are, you know, focused nonetheless on making up a big or a bigger impact than maybe a piece of software could. How much of this bioeconomy involves replacing? Costly or environmentally damaging practices with some plug and play better solution. How much of it is creating an
entirely new category? I'm sure for some applications it's one, for others it might be the other. What do you think? Yeah. You know honestly in order to be successful when you look at history especially with these raw materials, you need to have a situation that you're making use of the existing billion dollars, trillion dollars worth of manufacturing infrastructure that exists. So you need to have a solution that doesn't require someone to change their light fixture to
use your new light bulb. And that's not just in case of raw materials, but just for light bulbs and light fixtures as well when you look at it that way. So it's there are new materials that could have new applications, but our focus specifically is on integrating into existing industries and their existing manufacturing systems and that then will accelerate adoption and then allow us to move into new applications as well.
I think that's a nice general foundation setting for the space as a whole and surely there's more to say, but it's probably a good time to reintroduce Hexas biomass, how you started what you're working on, what's unique about you relative to other biomass innovators? Sure. So let's see Hexas biomass in general. We produce a plant based fiber that is a replacement or substitute for fossil fuel based fibers and also for wood.
And we can also supplement those so we don't have to get rid of them all completely because wow, those are that's a lot of raw material around the world to replace. So supplementing is also an option. So our fiber is called Xanofiber.
It's a carbon negative fiber. If we grow it from a giant perennial grass we call Xanograss that we developed here and that Xanograss will sequester carbon significant amount over a ton of carbon below ground every year and we can plant it once and then grow this plant for 15 to 20 years. I actually saw the wild version of the plant that I've developed Xanograss from WOW back almost 10 years ago.
And I just looked at it from a a structural applications perspective, So things like potentially building materials and and furniture and so forth because it had just this great fiber profile. So with my background in materials engineering and biotech, I just couldn't get it out of my head and I thought, well, this is something that I want to do, something that can have that big major impact, not
that I was looking for that. I just thought I don't like to see trees cut down to the point where we're making toothpicks and things like that out of them. And it'd be nice to have fewer plastic material produced products. So it took about five years to develop our, our technologies including the plants and we do the propagation of this plant, it's sterile, there are no
seeds, so it's not invasive. The production capabilities then we're harvesting of it and then post harvest processing into chips and strips and and grinding it up into sort of a flower even depending on the application it's going into and then you know specific applications that this we might be using it into investigating those.
So that's that's where we started and now we're in the process of real commercialization takes a little like you said a little while to get there as a as a raw material that I guess deep tech product and we are, we have pilot agreements in several different industries, we have grants and so forth. So we're really moving this forward now, really off to the races.
One thing that you've mentioned too, this is on the original podcast is that it actually grows on marginal land because one of these super old fights that happens while I'm introducing this in exactly the same way as the other podcast, one of these classic fights about biomass is how much land is going towards growing a food and how much of it is going towards fiber or ethanol or something like that and how that impacts food politics and people getting enough food to eat and
things like that. But. Your approach to biomass has xenograss growing on marginal lands that would not otherwise be farmed. Is that right? That's correct. So around the world they're over 208,000,000 acres of just abandoned farmland. That's just abandoned farmland.
And one of the reasons people are abandoning farmland is because they we've overused fertilizers, we've depleted the the groundwater, so there's not enough water there and yet this farmland is just sitting there topsoil is washing away. The rural communities in which it sits are not benefiting from it at all. Property values have gone down.
So when you look at that situation, you say, OK, wait a minute, yes, we still have valuable farmland out there where food is growing, but we have a significant amount of land, whether it's farmland or old sugar cane plantations, old tea plantations, strip mines where that land is not being utilized, there's no monetary incentive to revitalize it.
And then but if you have a product like ours where we can utilize that land and in utilization of that land sequester carbon but also rebuild that topsoil and rebuild the soil and the soil Biome and add nitrogen to the soil. Just with this one plant, the root system goes so deep that we're we can break up hard pack and this plant is wonderful.
Xanagraphs will actually create its own Biome for soil to have a symbiotic relationship with the bacteria and fungi there, so creating its own little ecosystem. So we feel that if you have deteriorated land and we can use it and we can turn it into valuable land again, that can be either used again for food crops, reused for rewilding and replanting of native species, or some of it even used for housing
and housing relief on that. But if we're revitalizing those rural communities, creating jobs and building up that economy again, we're feel like we're doing the right thing by people. Are there many competitors or peers of yours who are working on similar biological entries into this space? There are some people who are working on specific biomass, competing biomass with ours. So that would be things like Miscanthus and switch grass and hemp, Napier grass and and also
some agricultural residuals. But we'll keep those separate because that's not purposefully grown. We're we're considered what's called a purposefully grown crop. So there are some, yes. How does, how does Hexis fare xenograss fare in the trade-offs against some of these other approaches?
So first one of the things that I realized and looking back at sort of historically at the the fiber, raw material fiber industry is that it's fairly disjunct in that you might have a farmer who grows and then a middle person who who sells and then that gets sold again on the spot market and there's just a lot of players. So the first thing we did was streamline that and have a fully integrated supply chain which starts with us putting those plants in the ground to the
formatting of the fiber. So that's different for us and that keeps our cost very straightforward and our customers like that because they know exactly what the pricing is going to be and it's not going to fluctuate like we had would fluctuate so much during the COVID years. Secondly, we produce a significant amount of more biomass. We produce significantly more biomass on a per acre basis than these other competing biomass products. So that makes this very land use
efficient. For example, we can produce 20 to 25 dry tons of biomass on an acre whereas mescanthus it may be 15 and switch grass 5, hemp maybe 7. So significantly more. That makes us much more efficient in use of inputs, less water, less labor, less use of you know tractors and fossil fuel based machinery that we currently have to use. So that that that's that's where a big differentiator for us is just the efficiency of production. I have such a a basic and kind
of weird question. Remember, this is a a topic of debate among early scientists. We're trying to figure out where biomass comes from. Like, does it come from water? Does it come from the soil? Is it synthesized out of the air somehow? But where? Where is all that extra tonnage coming from? Is that a crazy question? No, I would say that's coming
from all those things. I mean you think about the plant as a living thing just like us. And we, we have building blocks which are essentially the same as plants, but you know, we need to eat to survive. And and these plants, these plants that we grow in terms of xenograss, they use a lot of photosynthetic energy. So they spread their leaves out in order to generate the energy necessary to grow so much material over a shorter period of time.
And like I said, they create their own soil Biome to support that production and have a symbiotic relationship with that that Biome yet using less water than other plants in production. So, yeah, it's a combination of all those elements coming together in just this remarkable plant. Is it possibly related to its sterility and that it isn't spending much in terms of resources for reproduction?
Yes. So it wouldn't create like, you know, it's in the same family as corn and bamboo for example. And you know bamboo can grow very quickly as well. So neither xenograss or bamboo produce a fruit like a like corn would. And then it also doesn't produce any seeds, so there's no need to expend energy on reproduction at all. So. This kind of hurt my brain to think about, and you showed me some of these reproductive nodes on the segments of the zanograss. But how do you?
Because I know you're involved in in some sort of selective breedings. You're you're searching for traits, you're breeding for traits, yet this isn't a plant. That is. What's the opposite of sterility here? Fecundity. It isn't naturally. Second God, is that even? Is that the right way to say that? How do you, how do you breathe in a plant that doesn't
seemingly want to? Well, you know, it's interesting that with this plant we'll select those those plants that are working really well with the soil to be high producers in terms of biomass volume, right. And therefore, if they're working well with that soil, then it's likely they'll work well within the same similar type of soil somewhere else.
Now the this plant also, again I keep going back, but it does have this relationship with the bacteria and the Biome, the fungi and the soil that also will help it turn off and on genes, what are called alleles in the plant to help it work best in the environment in which it's living. So it can live in some fairly harsh environments, but it's that really cool relationship that plants have with one another, just like trees have with one another where they help
each other out. Where does the carbon removal portion of this come in? There's really two places. One is in the stock material, so that above ground material and if that then you know, has about 48 to 49.2% carbon in that stock material. Then if that material is used for engineered lumber, for fiber board, for materials that are going to be long lived in utilization, then you get that
level of carbon sequestration. So that's about 12 to 12 1/2 tons of carbon in the stock material on a per acre basis. It could be more depending if we're growing in a warmer climate, we'll get even more material grown. And then underground is the other place where we see carbon storage and we are working on that underground carbon storage to really understand how that functions.
We know that the roots for xenografts will go deeper than 60 centimeters, which should provide some level of permanence and stability within the soil. And then that upper, you know, zero to 30 plus soil is alive, It's going to move around, it's going to shift things around. So we are working with the USDA on one of the research farms to study exactly what happens in that upper level of soil and what the degree of permanence
might be there. And which of the applications are you actively investigating right now for the above ground biomass that you're producing? I can see so many applications for this to swap in for less environmentally friendly assets. Yeah. So like like we were looking at the lab, there's certainly the the fiber boards where you have a lot of wood used for particle board production for furniture and and molding and and so and then medium density fiber board.
High density fiber. It's used for that now when people make it wood. So there's they use. Some places are using whole logs. They're also using residuals from timber mills and some places are also using what's called construction waste. So wood from construction waste that might have nails and things like that in there, but there still is some virgin wood being used no matter where you are to produce that kind of those kind
of fiber boards. So we can be the alternative to that virgin wood in in these applications. The same thing with the pulp applications, whether it's for paper or for packaging or for direct or for multiple packaging as well. We can be that replacements for wood and wood residuals in those applications as well. And is this wood typically coming from, I mean, this isn't some 400 year old cedar that's being cut down. It's oftentimes coming from a tree farm, I would guess, right.
Yeah. So you have farms specifically in particularly in the Southeastern United States for example, where they're farming trees specifically for timber and then for turning into lumber. And then there's a lot of residual from that. The biggest struggle with the repeated cutting of trees and tree farms and such is when you get a monocrop, right.
You get the same tree over and over in a perfect rose and you also then the soil gets depleted because you're not growing a diverse set of of plants, grasses and etcetera, fungi and so forth in in these settings. So that that's one of the struggles with the constant farming of trees, let's say. So what they're not adding as much as it has to be taken away to put that new little tree in the ground and get it up to up to size. So that's one of the struggles
with these farms. But there are lots of places unlike the US that don't have a lot of access to trees and to wood. So in those locations you may see more cutting of trees that are very, very valuable and have a very significant impact on the ecosystems there. So if we can replace any use of those trees looking outside the US, then we can be valuable in those systems for building materials for fuels, liquid biofuels for example, for like in pulp and paper, for even textiles.
So lots of applications where we can come in and and make a difference. What do you think will happen to those tree farms if they were out competed by xenograss biomass? Would they? Because they their own, they're probably owned by large timber organizations, in which case they probably wouldn't just be rewilded and diversified, they might just be clear cut and then abandoned or sold off or stranded.
And that's sort of a hardcore question, but what happens if they become less valuable because the product that they're making is no longer as desirable as something like Santa grass? I know this is not your responsibility actually. I appreciate that. The 2nd order respects of this is what I'm curious about. Yeah. Well, fortunately there are people who are no longer cutting
their trees. So a lot, a lot of the, the land in the US is privately owned, not just by companies but also by families who made purchases in large tracts of land with with trees and they're actually getting paid to let those trees stand, right. So to continue to sequester that carbon. So that's the one real benefit
of this. There are people who have bought that land and then we'll just cut like you say cut those trees down, take all that revenue from the the lumber that would come and then sell that land for you know maybe housing or or something like that. So I don't know privately what they would do, but I I would imagine that we're not going to be seeing wood replaced 100% by zanograss, Nanofiber and other non wood fibers in the Super near future.
So hopefully people will be smart about their investments and look to how they may still capitalize on those, but maybe not necessarily the way they thought they would capitalize on those. I guess why not? Why wouldn't we see xenograss and biomass take over if it's using abandoned, corrupted, marginal land that has all these great benefits? There's probably more ability for ecosystem service payments, and maybe not, depending on the
trees and where they're located. But why is all this energy? Is it just institutional inertia? Why are we still talking about using trees for these for like low value commodity based inputs? Well, we're still cutting trees for lumber. So that's the primary reason to cut trees and that the lumber you can get probably 33% of the tree to 37% of the tree is my
understanding. I would have to look this up again, but in my, as I recall is what's used for lumber and then you have the bark and the other parts of the trees that can be converted into these fiber boards, energy pellets for direct combustion and other applications. I mean they even use wood to make textiles. So there's there's a market, right, There's a market for it not just for the, the lumber, but back in the 60s they realized, wow, we got to do something with all the sawdust.
You're building all these houses, we have all the sawdust. What are we going to do? So they just mixed it with glue and made these other type of boards. So there's there's an industry built up around this. There also is a significantly more trees being grown than there is xenograss or other biomass. We can switch that over particularly if we can please get rid of corn as a source for biofuel.
But it's going to take a little time to make that switch and have to go through that adoption period and bump up against some people who are, you know, definitely well and deep invested in maintaining that status quo. I would love to learn more about ethanol and corn biofuel. Energetically, it doesn't actually make sense. It costs more energy to produce than it does to use it. So that's bad, negative from the start. And yet it persists and is so powerful Is did it come about?
Maybe during the OPEC oil crisis decades ago. And then it's just hung on since then. My layperson's understanding of it. Do you happen to know? I don't have a real clear understanding of of the origins. I know that it is a valuable product for people who produce corn in general. Well, we know that they like it. That's that's no real surprise, Wendy. Yes, they like having. Yeah. Yeah, they like having the money
in the subsidies. And so there's about what 93,000,000 acres of corn produced in the US and I think 40% of that is used for fuel. So you know, again, these are people who are invested in long term into the reduction of ethanol. My understanding from talking with people who are experts in the industry is that as we move to electric vehicles, we'll also see decreased use in ethanol,
therefore a decreased need. And I know that in in Europe now you can no longer sell ethanol into Europe that's produced using a food crop. So something that you can't produce from corn or soybean or from sugar cane for example. So there is the push away from using a food crop to produce fuel when there is alternatives of biocrops biomass that you can use for that production that again don't require the use of food grade land for production. Interesting.
Kind of wonder what would happen actually like if if the economy is switching over to Ev's it appears that is likely to occur and keep occurring. I'm wondering if maybe we produce an import less oil and gas and the percentage of ethanologist goes up within that existing fuel amount. How are you? Which one is corn more powerful than oil and gas or or the other one? That's a good question. Yeah, sure.
It's more powerful. In terms of those lobbies, well, you know in in South America, of course they use a lot more ethanol than we do. It just burns faster in the cars. Yeah. So you, you know, you use that up faster than you would. So you're going to the gas station more often. They just have a lot of sugar cane down there and they use
that for production down there. So it's, it's again though they can't now no longer can they take that ethanol and export it into Europe. So things are changing just like we started off talking about, right, software, we can move quickly. If it's not Myspace, it's Facebook. If it's not Facebook, it's Twitter. If it's not that, then TikTok And you see those move fairly quickly.
Whereas when you're talking about the commodities industries, all these different commodities, we're slower to make these transitions because you've been the investment is just in the trillions and trillions of dollars for the infrastructure associated with this. And then you have these people who are very invested in terms of what they're growing and what they're how they're processing.
And you think about all the folks that are involved in the supply chain, it's going to take a little longer to make that that transition. I'm always curious how these problems untangle themselves, because if you just told people that their investments, their assets were going to be stranded and they were going to be on the hook financially, obviously they would have. Enormous incentives to politically oppose whatever technology was outmaneuvering
them in this way. Should that be a taxpayer buyout? In the same way, if the US could just buy out oil and gas companies and turn them into renewable energy companies, would that save us from a lot of the fights that we're having right now? Because their backs wouldn't be against the wall and they'd have
to preserve the status quo. Well, certainly politics plays into this, but we're seeing a lot of gas and oil companies move to renewable energy and one of the things that's been very critical in the transition not just to renewable energy but to lower greenhouse gas emitting raw materials is regulations.
So I mentioned Europe and the ethanol without coming from a core, I'm sorry a food product they also you know in by 2040 in Europe you no longer can use single use plastics for different packaging and eating utensils and all those very many things including furniture wrappings and the list is incredible things you don't even think about that are single use plastics. With those regulations we're seeing the push towards these alternatives.
So federal regulations at multiple levels are necessary to start seeing that push for change. And as we make the transition away from greenhouse gas emitting fossil fuels and so forth, we are seeing companies make that switch over and we're seeing them create new innovations. But again, it's not going to be an immediate switch. They're still going to be fossil fuels burned for various applications because you have to
also consider the economics. So if it costs them so much more, so twice as much to use biomass, let's just say for the production of fuel, then that twice as much gets passed on the consumer. So there's there's the whole economic supply chain that needs to be considered when you're
making these transitions. Therefore the IRA for example that came out of the Biden administration is supporting these kind of conversions financially to move to make it easier to transition to these bio based fuels in the bio based economy versus a fossil fuel based economy. Has HEXUS been able to take advantage of the provisions of the IRA? We will take advantage of them as a sort of sub within that context.
So as a raw material supplier to those who are moving into the conversion of those raw materials for sustainable aviation fuel, for example. So we have a grant from the US Department of Energy to focus on optimizing our fiber for conversion into those precursors that then are converted into sustainable aviation fuel. So that's where we come in. Wow. And we talked about this in person too, And that's kerosene, right? Yes. OK. And but ethanol is more equivalent with gasoline, is
that correct? Yes, right. So it has to do with the basically energy output. And so we don't use gas in airplanes because it makes a lot more energy to get those things off the ground and moving than it does for of car. So we need you know diesel for for heavier trucks and you know moving lot heavy loads, but ethanol we can use for those those lighter weight applications. Lately I've seen a lot more skepticism towards the ability of sustainable aviation fuel to
really take off. Was debating whether or not to draw attention to that unintentional pun. I'll probably have to edit that out because it's pretty dumb and I'm unintentional as well. Does it make sense to produce
fuel in that way? So when you look at sustainable aviation fuel, it comes down to the raw material and it comes down to can you produce enough of that raw material without wiping out everything else in order to achieve what we need by 2050, which is somewhere around 500,000,000 gallons of aviation fuel. And I understand the sustainable aviation fuel is mixed with existing aviation fuel. So you're really only getting a 50% carbon cut, but nonetheless
you're getting a carbon cut. So with sustainable aviation fuel, you're really looking at the economics of it and the the having to have a biomass product I would say like ours that produce a significant amount of biomass in a per acre base is very land use efficient, works well in the existing pathways that what they're called for sustainable aviation fuel. So, yeah, the the real question is can you produce enough of
that biomass? Well, we're doing it with corn and if you just switched over with corn that a lot of companies are already utilizing towards sustainable aviation fuel, again, that's a food you really don't want to do that. Right now most of our sustainable aviation fuel is being produced from what are called heffas, so fats, greases
and oils. That one kind of bends my head a little bit because we're using that much what we have right now of going out and collecting fats and greases from restaurants, for example, or processing plants that have used it and they're recycling that into fuel in and of itself is quite
greenhouse gas intensive. For all the moving around that you have to do. If you used to think you start with a little canola seed and growing that in the farm and then it gets processed and shipped all over the place and then reshipped back to processing, we're not going to get there. There's not enough of it out there for us to, to achieve what we need in terms of fuel.
So it really comes down to be having enough biomass in the locations where it's needed to be processed into a sufficient amount of fuel that makes sense economically for us to to be mixing with that existing aviation fuels. You had some sort of mileage limit that it made sense for you to move Xanograss, right? Right. So once we harvest the Xanograss and then we call it Xanofiber, after that, that Xanofiber or any biomass.
So it doesn't matter if it's ours or anybody else's, and even, you know, wood material, not whole log material, but chips and and sawdust and so forth, you really only want to ship that a maximum of 60 miles. And most people will tell you, no, really, you really want to ship it about 30 miles. So that being the case, then when you look at the geography and you look at different ecosystems and climates, you're really limited to certain biomass growing in certain
locations. But with our biomass, because we can grow it in so many different climates, in so many different locations, we offer a different scenario. The different scenario being that you could use our biomass in multiple locations for the same process and therefore be achieving the same results no matter where you are in the world, essentially. I mean, we're not going to grow on the side of mountains, we're not going to grow where it's
super, super cold. But we certainly can grow in many different locations, giving people an option for a very consistent, reliable supply of biomass with the same properties
over and over again. Because if you want to use banana peels in one place and switch grass in another and pineapple here and peanut shells there, you're not going to get the consistent properties that you need or the consistent volumes every year, so. Yeah, you probably can't have that much heterogeneity within a raw material stream like this and have the end product be consistent, right. Right. So a lot of times you're looking at just energy output from these different materials.
They they're starting to balance it more. So they can, they usually balance like for example with wood and direct combustion with wood pellets. They'll add a little bit more wood if they have some peanuts in there or something like that. So they they're working on that that that balancing of energy use. But when you're talking about then making a product so you know whether it's a textile or a paper product or something, you really do want the same same thing every day.
You know, it's something, not something new, not today is, is apple cores and tomorrow is high needles and things like this. You want. You want that consistency. Yeah, that sounds really complicated to do it some other way or to have shipments be all mixed together every day. Yeah. Well, given that you most things are harvested once a year, then you have a lot of storage issues and degradation potentially and so forth. There are issues to deal with. We can harvest you around.
So it makes us a little different that way. Yeah, that makes sense. Is there an interaction with bioplastics or some way of using Xanograss to supersede the need for single use plastics? So sure, you can make products that are strictly Xanograss. So if you think of now we see a lot more of those bowls made with scrap wood or scrap bamboo or something like that, we could certainly replace those or
supplement those. But when you look at biomass and you think about it, you know there are different components to it and those each one of those components can be fairly valuable. So if you look at Xanograss for example and Xano fiber, you can pull the lignin out of that fiber and use lignin. You know lignin's every, it's actually used in every battery that you touch.
There's lignin in that you can use it in the cellulose for making paper or absorbent material for diapers or for cleaning up oil spills or so forth. There's so we can pull out these different components from the Xanofiber and use them in different applications, which makes it very versatile. You know, you really want to have something with that level of versatility as well. Here's another kind of silly 1. Instead of making bioplastics, could you wrap more things in banana leaves?
Or just big unprocessed fibers, maybe? I think that would be challenging though, because you would see degrading of that fiber over time. So that's the big issue as you're talking about a biodegradable product, right? So banana leaves, certainly it's a biodegradable product. I think that if you used it one maybe twice, you could possibly find A use for it. But again, banana leaves are very local to where you can
produce bananas. Therefore, you can't really use them in other places unless you're going to ship them and somehow preserve them, and then you're getting into the whole preservative issue. I'm interested in the single use question. I have an acquaintance who's always skeptical of environmentalists maneuvering, I guess you could say, and did not like the move towards reusable
bags only at grocery stores. And he marshalled in defense of this, that there are, I don't even know, 10s, dozens, hundreds of cases in the United States every year of things like E coli coming about through unwashed reusable bags. And it's, it's, it's user error, right? It's not like the right? People don't wash them, but is there a way to to make sure we can throw stuff out that also isn't harming the planet? I like that.
I like. Being sustainable in the sense we're using and not being wasteful but also some portion of the population is going to get sick through negligence every year if you don't avoid it. It's true. No, I can completely see that I that's I hadn't heard that but I can see that that would be the case. You know the struggle that we're having right now in terms of biodegradability.
So let's talk about biodegradability because that would be the ultimately the way that we, let's just say this material and just have it go back to the earth and return to earth is that we have different degrees of biodegradability and some biodegradable ability is, yeah, you could just stick it outside and it's going to melt and go right back into the soil. Then there's some that needs a little bit more processing or some that takes longer than that.
So I think that's where we're struggling right now is on the degrees of biodegradability of this material and how to implement it and then how to recycle it or find a way that if you're going to put it in the garbage because you know, we know everybody throws stuff away, how do we extricate it and then put it in the right bin, let's just say for biodegradability. So that's that's something we're still, I think societies around the world are still working on.
That's been my experience of it too. And then I've also had experience of products that were attempting to replace. Cases, Straws. Plastic straws are clearly bad. I like metal straws, although I Ding my teeth on them sometimes. But the the worst are I've had paper straws, I've fallen apart in my mouth and just taste bad. I spent $6 on this iced coffee and now it's it's basically terrible. I know this has become a Trump talking point and I am ashamed to be echoing it, but also he's
kind of right. I'm not like paper straws. My experience has been almost universally negative. So if you do make a straw, Wendy, can you make it worth a damn? Please. I'm gonna try, I think. Think what you get with paper straws though too, Ross, is you get a lot of it's recycled paper and you're talking about when you're talking about straws and that that is just a low value commodity overall, right.
So you're gonna get probably a low value material into it, you know, so that that it's maybe twice recycled wood that you have going to these straws. I don't know, but there's. We can use our material not either recycled or not recycled and to make these kind of paper products and lower cost And actually because we're using essentially grass and Zano grass, right. And our fiber that comes out of it is is differently structured than wood would be.
We can use a less chemically caustic process for producing the paper that would be used to make these straws, for example, are used to make corrugated boxes and and wrapping and so forth. So I don't have a solution for your the straw issue because I'm not quite sure how many times that paper has been recycled, and I'm guessing they're not putting a wax on it for just sealing it up to prevent it from
just melting away like you say. I like the angle that you come out with where it seems in many cases Xeno fiber should perform similarly or outperform the conventionally produced product. I imagine that's at least your intention, in which case I think that generates a lot less conflict. I think when you're asking people to swap out something that is convenient or easy for them, and then the product is just bad, even if they have to sacrifice for some abstract
goal. I guess sometimes that works. I guess when, when are people willing to sacrifice and when? When exactly aren't they? I don't think they are just in general, well somebody's they are like it's we're recording on September 11th right now. So that was a day where people, for better or for worse, like collectively amounted to something. Right.
But so when you think about from the perspective of a raw material, when I came into this, I had done work in materials engineering and one thing I knew is that what are? Hex's customers would want is that again, they wouldn't have to want to change things in order to use a new raw material. I also knew that it had to be at least 10 to 20% less expensive than the existing raw materials. And that's just to get people's
attention. And then there's a process of, you know, testing it. Is it going to perform as well or outperform in cases we do outperform would. And that but nonetheless the product looks the same. So no one's freaking out like Oh my gosh why is that all lumpy now and and not smooth like I used to used to see it.
So, you know, they're, I think people are willing to do things like even, you know, bring their own bags to the grocery store for the greater good and hopefully not poison themselves. But they're when you look at it again, you have to go back to the economics as much as I'd like this to be Ross, about
strictly about impact. We really have to go back and look at the economics of introducing a new raw material or bio based materials are changing things in our economy for the better and how can we make the economics work. So that's was my focus with Hex's was the economics associated with it and then then the impact and benefits we
otherwise could have. I think people are willing to try something new as long as they don't necessarily have to pay that much more for it, or any more for it at all. But you know, we're working B to B. We're not working with the consumers. And so consumers may be willing to pay a little bit more to offset their carbon and so forth, but the businesses otherwise have to pass that cost along to their consumers and that's something that they try to avoid.
Tell me more about that part of your business. Cost reduction is necessary to get their attention just in order to consider the cognitive load of considering a new input, yes. So it's the. Cost reduction, ease of use and then then you add on the requirements for like scope one and two and three in terms of the supply chain and the ESG applications. That was never so that was important to me.
But you know when you talk to the people who make the decisions about integrating new raw materials into their their existing existing products or making a new product, they really are focused on, is the material consistent, Does it work within our system? Can you deliver it day after day after day after day? So they're very straightforward, simple considerations, but absolutely necessary.
Then also to support that side of innovation that says, hey, we really want to reduce our missions, scope 1-2 and three, we really want to get those down. How can we do this so the procurement people get pushed by the innovation people and vice versa. And knowing that that battle was going to happen before I even really started any commercialization or getting into this, I knew that whatever I developed had to meet those.
Those parallel needs so. It seems like it's probably just easier to to sell as well if you're offering potential performance upgrades, cost savings and then the ability to work with the procurement people and say, well, we've actually cut emissions by this amount or we have these other benefits that we're providing as a result of our choices here. That seems like a much easier sale to make then hey, it's going to cost you more money. It's not going to perform as
well. You get to brag about it a little bit, but there's no regulation forcing you to do this, so it's not super relevant. That seems tough, right? Well. It's it's it's threading a needle. It really is threading a needle being able to hit all of those points. And I, you know, when I started this, I wasn't sure we were going to do that. I didn't know if this would have to become sort of a specialty fiber, right, for for higher margin applications and so
forth. But I think we've worked it out now to be able to thread that needle given the testing and the work that we're doing with existing customers and the piloting we're doing and testing in a lot of different applications. And the grant work that we're doing too is really supporting figuring those things out in specific applications, especially in the energy side. Is HEXUS gonna pursue a licensing model or grow it and sell it yourself? Something else?
That's a really good. Question so. In order to implement and perfect the template that I've developed, which I call our farm to fiber platform that runs from propagation through processing and the final product, we are doing it ourselves up front for a little while. And then once we have that template in place and the kinks worked out, so to speak and we can sign supply agreements that are just modular and can actually stand alone as our own little businesses, then we'll be able to.
License to companies that have the acumen to follow that template and be successful at it. So, yeah, so licensing certainly is, is part and parcel of what we'll do not immediately, but once we get all the kinks worked out, certainly we can license and then see more of that exponential growth, that growth that we expect into many different industries. When can we expect to see see more of this? Seems like you're in a grant writing, slash grant consuming phase and you're trying to
commercialize. And when might someone be able to buy something that has Hex's biomass involved? I would like to. Say by middle of 2025. That's pretty close. That's not, that's not that far off. Yeah. Well, no. Well, we. You know, we have to work on the agricultural cycle. So that's one of the things that people that need to integrate into their sort of mental systems is that this is an
agricultural product. It has to grow 1st and then we cut it down, but then we can grow it and cut it down every year after that. So, yeah, wow. Well, that's great. Are you able to tell us anything else about what we can expect in the next little bit of time for you, or are your lips sealed on what's going on? Well, we've. Got sort of a bigger. Partnership announcement coming out in October, which I can't talk about just yet, but that that's coming out.
We are going to continue to you know apply for grants, but I continue to work towards that level of commercialization. We are raising our round right now. So I hope to get that all closed up in less than a month and then have a big announcement about that and who those players are that will have be supporting HEXUS going forward so that we
can really. Make tremendous progress and have a genuine impact, which is my ultimate goal, to have a genuine impact for my children and all the other children out there and their children. So that we can move away from these fossil fuel based materials and also minimize, if we can, the use of forest for building and other applications.
Are you planning on trying to create and market carbon removal credits yourself, or would you like to pass those on as a benefit to purchasers of Hex's biomass so that they can claim that carbon removal from within their value chain? So that will be negotiated. With each customer as to how they would like to work with us on that. So we have one customer that just wants to retire those is not interested in using them themselves or us. Selling them independently on the on the market.
So it will, yeah it's some, some are very interested in it and utilizing it internally. Some are like well you know that's it's a great selling point for us. We're not necessarily you, you want to, you know, retire those and then others are like, no, you guys go ahead and you know, we just want to you do your thing, we'll do our thing, you do your thing, and that's not part of the equation. Well, thanks for being here, Wendy. Thanks for having me down Olympia as well.
I really like what you're doing. Thanks for entertaining all of my questions, some of which were, you know, right over the plate, some of which were pretty zany. Let's be real. But I'm a fan of what you're doing. I really wish you enormous success. I think it's really important if we can make better straws. And I'm just kidding.
I really think is really important if we can swap out some of these inefficient raw material sources for something that's a bit more ecologically thought through. But it is my pleasure, and again I. Really appreciate taking the time to come down and visit the lab and the research farm. And thank you again for the opportunity to be on this podcast. It's pretty cool to have a repeat. I like that. Thank you so much for listening.
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