Innovating through Alliance: A Case Study of the DuPont–BP Partnership on Biofuels
By Truman Semans and Andre de Fontaine
This case study on DuPont and BP’s partnership on advanced biofuels aims to provide insights into how industry alliances can deliver innovation and new technologies in an accelerated fashion.
In June of 2006, DuPont and BP announced a partnership to develop and market advanced biofuels designed to overcome many of the environmental and economic limitations associated with biofuels currently on the market. The first product scheduled for commercialization is biobutanol, which can be made from the same plant materials as ethanol, the currently dominant biofuel. Biobutanol, however, has several advantages over ethanol, including potentially lower lifecycle greenhouse gas (GHG) emissions, higher energy content, and better supply and distribution dynamics. These advantages stem in part from the novel method DuPont developed to convert plant sugars and starches into a combustible liquid, using an advanced biocatalyst instead of traditional yeast.
Focusing particularly on DuPont’s perspective, this paper describes important elements of the corporate strategy process that resulted in this effort to capture a new business opportunity for climate-friendly technology. It is part of the Pew Center’s ongoing research into best practices for corporate strategies that address climate change. The paper is not an endorsement of biobutanol or any specific fuel DuPont and BP may develop in the future. Rather, the goal of this paper is to highlight the strategy and process DuPont undertook in partnering with BP to develop the fuel, in hopes of identifying lessons that other firms can apply in advancing climate-related technologies as changes in public policy dramatically transform markets worldwide. The Pew Center also aims to help policymakers understand how to shape policies and programs in a way that unleashes the innovation and investment capabilities of the private sector in addressing climate change.