Brows furrowed deeper when they revealed their strategy to not only sell the fuel but also a waste from the production process that had unique properties as an agricultural crop booster.

The Greenwood Village, Colo.-based startup — which began construction on its first production plant in Louisiana last month — has a lot more believers on its side these days.

The technology has lured investment from the likes of General Electric, ConocoPhillips, BP and Google. It was developed by serial inventor and entrepreneur Mike Cheiky, who is now Cool Planet’s chief technology officer.

In late February, the company broke ground on a $56 million commercial production facility in Alexandria. Plans are in the works for two more Louisiana production plants.

Janzen, chief executive and a veteran of the pipeline and telecom industries, said Cool Planet is getting its footing at a time when many investors are growing weary of biofuel concepts.

Companies have built massive production facilities to make fuel out of everything from sugar cane to kitchen grease, only to lose money or flop when market dynamics shift, he said.

“The conventional approach has been bigger is better,” Janzen said. “People try to take a new technology and deploy it at a very large scale. First of all, that’s a very hard thing to do. Second, you have to execute it almost perfectly in order for the investment to work.”

Janzen said Cool Planet’s pitch differs on a number of fronts.

For one, it’s building smaller, modular production plants closer to where the biomass needed to make fuel is sourced.

The Alexandria plant will start out producing only up to 10 million gallons per year and tap the ample supply of pine wood chips generated by central Louisiana’s lumber industry for feedstock.

Janzen said biofuel may not be the only money-maker for the company. Its production process produces a type of waste known as “biochar” — essentially the carbonized skeleton of the wood chips, grass and other material heated up during the fuel production process.

The company says tests are ongoing, but early results show biochar can help crops retain fertilizer and water and boost overall harvests when mixed into soil. The biochar also helps plants retain carbon, the company says, meaning Cool Planet’s production process removes greenhouse gases from the atmosphere.

Janzen said Cool Planet aims to produce gasoline priced at $1.50 per gallon once production is scaled up over coming years. He said there is real potential that biochar “is going to be perhaps as valuable as the fuel we produce.”

Biofuel producers targeting Louisiana

Cool Planet isn’t the first biofuels producer to find a home in Louisiana.

Other producers, aided by federal tax breaks and fuel-blending standards, have been drawn to the state’s infrastructure and tax incentives.

Growth in Louisiana has been most visible among renewable diesel producers, which use animal fats and vegetable oils to make a fuel that looks very similar to petroleum diesel at the molecular level. Because of that similarity, the fuel can be transported in the same pipelines oil producers use to ship their product.

Dynamic Fuels, a joint venture between Tyson Foods Inc. and Syntroleum Corp., invested $138 million in 2008 to build a renewable diesel and jet fuel plant in Geismar. The plant can produce up to 75 million gallons of diesel per year and supplies military and commercial customers with fuel.

Last year, Diamond Green Diesel finished construction on a $400 million renewable diesel plant in St. Charles Parish. Valero Corp. and Darling International, partners in the project, cited tightening fuel standards in states such as California as a main driver to open the plant.

Michael McAdams, president of the Advanced Biofuels Association, said Louisiana has emerged as proof that the oil and gas and the biofuels industries can coexist. But in Washington D.C., the two industries stand at different ends of an ongoing debate over renewable fuel standards, he said.

Oil and gas companies are fighting federal standards that require refineries to blend more renewable fuels into traditional gasoline and diesel products. Renewable producers, however, say the standards are key to making sure cleaner burning fuels get to market.

The Environmental Protection Agency said late last year it would require refiners to blend 15.21 billion gallons of renewable fuels into petroleum-based products this year – – backing off the 18.15 billion gallon benchmark Congress set for 2014 when it wrote the standards in 2007.

In addition, federal tax credits for renewable fuel producers have spent the past several years in limbo. The most recent one-year extension expired on Dec. 31. Congress could pass another one-year extension this year.

McAdams said the biofuels industry, which produced 3.23 billion of gallons last year, is made up of small companies that are trying to bring new technologies to the market. Uncertainty over future policies is the industry’s biggest threat, he said.

“A lot of investors have been sitting on the sidelines waiting to see if that fight is going to work itself out,” McAdams said.

Going head-to-head with fossil fuels

Mike Rocke, who oversees business development for Cool Planet, said the company has worked hard to build a model that can be profitable with or without government subsidies.

“When we founded this company we built it on the premise that we needed to go head-to-head with fossil fuels without subsidies,” Rocke said.

Rocke said he thinks Cool Planet’s fuel product will speak for itself, noting it is nearly identical to traditional hydrocarbon gasoline.

He said one of the major oil companies that invested in Cool Planet initially questioned whether the biofuel samples it was providing weren’t actually the real thing. The oil company took two weeks to test and carbon date the fuel before verifying it was derived from corn, he said.

Rocke said a number of other strategic decisions help to manage costs, for example, avoiding food feedstocks such as corn that fluctuate in price depending on demand.

Cool Planet is taking advantage of a number of state tax incentives with construction of its first plant, including a $750,000 grant to offset infrastructure costs. It will also use the state’s Fast Start job training program to train for and fill 24 positions at the plant.

Operations at the Alexandria plant are expected to begin in early 2015. Cool Planet aims to begin construction on a second, 10 million gallon facility in Natchitoches by the end of the year. A third Louisiana plant is still in the early stages of planning.

The company continues to develop its fuel production technology at a research site in Camarillo, Calif.

Janzen said Cool Planet has the benefit of learning from past industry failures.

“Now much of the science is already proven out,” Janzen said. “We’re in a much different position than some of the people that have struggled before us.”