Edmonton based tech start-up, Innovative Fuel Systems (IFS) has developed a multi-fuel technology that allows heavy-duty truck engines to displace up to 55% of diesel fuel with natural gas or other cleaner burning fuels. Last year, they successfully filed a PCT International Application with the United States Patent Office to seek full global patent protection for their Multi Fuel Technology Platform (MFTP™). With a focus on worldwide commercialization in the road transportation sector, they are beginning the process of rolling out the first trucks outfitted with this technology.
While businesses in a lot of traditional sectors have been experiencing increased uncertainty and anxiety throughout the global economic recession, IFS is bucking the trend as they successfully move into the commercialization stage of their technology.
“The government grants that we’ve been able to access have been really helpful in reaching this stage,” said Leland Oberst, CEO of Innovative Fuel Systems. “It’s clear that the government wants us to succeed. And what I’ve found, is that a lot of our angel investors view these grants as a stamp of approval and it really helps to move the dial on an investor’s final decision to invest in our company.”
Already IFS has entered into an agreement with Westcan Bulk Transport and have implemented IFS’ technology on one of their trucks with five more to be outfitted in March. They’re also experiencing a lot of interest in their company by the investment banking community, which isn’t surprising when we look at global investment trends.
Growing emphasis on ESG
Over the last 12 months, the pandemic has overshadowed nearly every other newsworthy story in the media including climate change. But what we’ve also seen is an increased interest in ESG (environmental, social and governance) policies by international investors. This means that businesses that are paying attention to these trends are the ones thriving in our current economic climate.
Globally, this was the year the “net zero by 2050” climate commitment went mainstream with the number of commitments to reach net zero emissions from local governments and businesses roughly doubling in less than a year. Governments and industry are prioritizing climate action in their recovery from Covid-19 and as part of the UN Race to Zero campaign, many are aiming for a zero-carbon economy by 2050. There’s also a growing alliance aiming to reach these targets as early as the 2040s. And the buy-in is significant. This alliance now encompasses 22 regions, 452 cities, 1,101 businesses, 549 universities and 45 of the biggest investors. This shift isn’t just happening in emerging sectors, traditional sectors are finding new innovative practices and technologies to lessen their dependence on fossil fuels.
The challenge that exists in traditional sectors, like the heavy-duty trucking industry, is that the macroeconomics make it incredibly challenging to undertake this type of transition. Currently, any green technologies that are emerging for this sector (electrical, hydrogen, etc.) are incredibly cost-prohibitive. With cost savings being the biggest driver to change for this industry, there hasn’t been a significant onus to innovate. That’s where Innovative Fuel Systems comes in.
The need for bridge technologies
IFS’ technology reduces operating fuel costs, preserves torque and engine performance characteristics, and at the same time, reduces greenhouse gas emissions. IFS’ technology, which is sold and licensed to customers as an aftermarket product, also preserves the integrity of a manufacturer’s engine -warranty making the technology infinitely scalable.
“‘Bridge technologies’ have a major role to play in the energy transition,” said Leland. “Traditionally, diesel fuel has been getting the job done in terms of functionality and transportability. But there is also a growing recognition within the industry that there is a need to reduce greenhouse gas emissions. The beauty behind our technology blending natural gas with diesel fuel is that, while it lowers emissions and introduces significant fuel savings, it is also able to deliver the same power that these heavy-duty trucks need. Natural gas is plentiful and cheap in North America and IFS’ technology doesn’t create any trade-offs as far as functionality. We really see our technology as a win-win-win scenario.”
And industry agrees.
“Westcan is committed to reducing GHG emissions and will continue to play a leadership role in reducing both GHG emissions and fuel costs in order to make our operations efficient and sustainable,” says Mike Royer, Vice President, Fleet Services, Westcan. “Utilizing IFS’ technology gives us the potential to impactfully reduce GHG emissions and fuel costs from Class 8 heavy-duty trucks, including trucks with payload in excess of 80,000lbs.”
As Leland points out, the bridge to carbon neutral by 2050 is not a short bridge and technologies such as their Multi Fuel Technology Platform allows businesses operating in this sector to reduce their environmental impact in a way that is accessible. At the same time, bridge technologies can give the emerging green technology sector the time needed to build solutions that address the scalability issues around these innovations in a way that makes sense from a macroeconomic and business development standpoint.
“At IFS, we believe any technology that reduces GHG emissions must also be economically viable – this ensures comprehensive market adoption,” said Leland. “By taking a pragmatic approach to product development, IFS ensures our cleantech provides customers a tangible and quantifiable economic benefit.”
A view to a carbon neutral future
It’s that pragmatic approach that has Leland and IFS keeping their sights on the future of where this industry is headed. “It’s important to note that our technology platform has ability to utilize other cleaner burning fuels,” said Leland. “As such, our patent is designed around the use of multiple fuels. This means that we’re ready to broaden the applicability of our technology with other fuels as new opportunities emerge. We know that hydrogen is likely to play a major role in energy transition broadly and in this industry specifically. When appropriate, we’re less than one year away from being able to introduce hydrogen fuel capability into our technology.”
When it comes to the future of IFS Leland is bullish about their prospects. “When I look at our company, I see rapid market adoption because our prospective customers are able to reduce fuel costs, while also reducing GHG emissions. Also, we’ve put together an experienced and driven team that’s excited about contributing to IFS’ future. There’s a real entrepreneurial spirit within our team. Our goal is to have our kits outfitted on at least 7,700 trucks by 2026, which means we’re looking to expand our customer base well beyond the Edmonton Metropolitan Region.”