Frequently Asked Questions

C-Lock Technology | K-Fuel Technology | General Corporate

C-Lock Technology

Q: How does C-Lock Technology, Inc. make money?

A: C-Lock Technology, Inc. (C-Lock®) follows a typical software-licensing model combined with consultancy fees and a transactional share of revenue from emissions credits measured and generated by GreenCert. C-Lock’s business model benefits from high profit margins, high investment returns, recurring revenue, low capital intensity and rapid ability to scale.

Q: Tell me more about how C-Lock makes money.

A: C-Lock has a three-fold revenue stream. First, technology and technical services; second, license fees for our software solution; third, a sharing in the proceeds from emissions credits generated by the C-Lock measurement process. C-Lock’s value proposition to the customer is that accurate and precise measurement will lower the economic pain they suffer from emissions regulations (cap and trade). Inaccurate measurement could force them to pay millions in penalties and fees or miss millions in emissions credits that they could sell on emerging carbon markets. In Asia, every large enterprise-wide deal for C-Lock would have a $2 million to $3 million annual revenue stream. By the way, C-Lock is the only company working with IBM on GHG measurement, and IBM has turned on their sales and marketing machine after GreenCert passed rigorous internal scientific validation by IBM. The sales approach by IBM is its classic form of penetrate, establish the reference, harden the product in that reference, then take it from one customer to 1,000. Repeat it. Scale it. 

Q: Is Cap-and-Trade carbon legislation a pipe dream?

A: It’s already a reality in Europe and there are regional initiatives in the United States: the regional greenhouse gas initiative (RGGI) and the Western Climate Initiative. Whether Cap-and-Trade passes this year, next year, or never at all, we live in an increasingly carbon-constrained economy and the world is moving toward better management of carbon emissions. Whether carbon emissions are limited by cap-and-trade schemes, carbon taxes or voluntary measures, there will be an acute need for accurate and precise carbon measurement and information management. That’s where C-Lock steps in.

K-Fuel Technology

Q: Can you expand on your progress, if any, in China?

A.: China has 52 billion tons of low rank coal thousands of miles from where it’s needed. There is a compelling need within China to find technologies that convert this unusable coal into heat and light. That’s where K-Fuel comes in. The Chinese have examined multiple forms of coal upgrading technology and concluded that the K-Fuel process is the best. Tests have shown that the K-Fuel process upgrades the heat value of Chinese lignite by 50%. We are now engaged with officials at the highest levels of the Chinese energy industry and have established a Sino-Evergreen joint venture to lease this technology. China's National Development and Reform Commission has approved the use of K-Fuel technology in China. While the structure of an initial agreement in China might vary, the model envisions annual license and maintenance fees along with consulting fees.

Q: Why has it taken so long to make progress in Indonesia?

A: We acknowledge the project has moved slower than we would like, but the pace has less to do with the project itself and more do with the worldwide recession, changes in Indonesian mining laws, and swings in coal prices and demand. Nevertheless, our partners – Sumitomo and a major Indonesian coal concern – remain committed and enthusiastic. Don’t forget, this is a 30-year project, so long-term trends projecting increasing energy demand and coal use in Asia still work in our favor. We began working on this only a year and a half ago. At that time the parties in Indonesia were examining many different types of coal upgrading technologies. They’re not doing that any more; they’re working with us, which is why the project has advanced to a further very detailed phase of examination and engineering work.

General Corporate

Q: Which technology holds more promise, C-Lock or K-Fuel?

A: They both hold great potential or we would not’t be in these businesses. K-Fuel is a large-scale, capital-intensive technology, so comparisons with the C-Lock software solution are difficult to make on a head-to-head basis. In terms of near-term revenue, the recent C-Lock deals in Asia, Canada and Eastern Europe suggest that C-Lock is starting to show its potential.

Q: Is Evergreen Energy still a coal company?

A: It has become too narrow to call Evergreen Energy a coal company, though cleaner coal production technology is one of our two core business areas – the other being precise carbon measurement and management systems. We have established ourselves as a green technology solutions company. That’s how Evergreen Energy will be known going forward. Our coal mine in Ohio, Buckeye Industrial, is for sale.

Q: So you’ve given up on building K-Fuel plants?

A: Not at all. We are still following-through on established opportunities to pursue K-Fuel refinery projects in U.S. locations where they operate as hubs for various types of coal being transported in and out. Our global business strategy, however, is to more immediately leverage the K-Fuel technology and the scalable plant design perfected by Bechtel through licensing, joint ventureships and other revenue-producing partnerships. This approach greatly relieves the need for Evergreen Energy to seek huge amounts of capital while more quickly producing revenue streams in collaboration with large corporate and government entities. And it’s proving to be a successful strategy.

Q: All this “re-positioning”… Is this just investor and marketing spin? ... Like putting a different saddle on the same mule?

A: The company’s business model has been repositioned. We have oriented our company’s priorities away from capital-intensive production facilities and more toward leveraging our green energy technologies and solutions through revenue-producing licenses, joint ventures and other partnerships. And it’s working. The momentum and revenue-producing relationships we’ve created in North America, Eastern Europe and China underscore the tremendous potential of Evergreen Energy’s long-term business strategy.

Q:: Was Evergreen Energy’s decision to reposition its business model to licensing its technology a result of your failure in getting a K-Fuel plant built?

A: No. We are focusing on the fastest way to capitalize and generate revenue from proprietary, proven energy technologies and solutions including our K-Fuel process and our C-Lock carbon measurement and information management systems. We spent $100 million building and operating our commercial-scale coal refinery in Gillette, Wyoming. In work with our development partner Bechtel Corporation, we’ve proven K-Fuel’s performance and perfected the plant design. As such, it has generated considerable interest around the world, including the equity investment by Sumitomo into Evergreen Energy Asia Pacific to pursue a facility in Indonesia. A similar large-scale project is being developed in China, with involvement of a top energy company. Evergreen Energy is definitely on the ground in Asia, which wants to adopt cleaner energy standards while upgrading 230 billion available tons of lower-rank coal to fuel its extraordinary economic growth.

Q: But have you made C-Lock more prominent in your company’s image because K-Fuel hasn’t succeeded?

A:  We have worked carefully over the past 2+ years to incubate our C-Lock technology.  This isn’t about image-making, it’s about a business that is gaining traction in the marketplace.  The enormous potential of our C-Lock subsidiary represents a perfect storm of expansive carbon avoidance regulation, nascent cap-and-trade economies and a pronounced absence of precise, scalable and fully transparent tools to measure greenhouse gas emissions. Our C-Lock subsidiary adds to the strength of K-Fuel’s value to the new energy economy.

Q: So what business is Evergreen Energy in?

A: Evergreen Energy is an energy technology solutions company for the new green, global economy. We are delivering proven, transformative green technology solutions for cleaner coal production and precise, scientific carbon measurement.

Q: We appreciate that you’re opening the communications channels, and coming out to talk to investors and media. Why have you not done this for so long?

A: Our investors – like our board of directors – understand where we are going and are in this for the long run. We wanted to focus on building a record of accomplishment rather than spend resources to further market our good intentions. We’ve achieved that momentum. Over the last two years, Evergreen Energy has become stronger than ever about its leadership, governance and financial standing. Our business strategy is sound, and our proven new energy technologies are making their way into North America, Eastern Europe, China and Indonesia through relationships with some of the world’s most assertive corporations and government entities.

Q: Is it fair to say that Evergreen Energy’s business is more international than domestic?

A: No. We are where the demand is being incrementally generated. Eastern Europe, Canada, China and Indonesia are all building their energy infrastructure with amazing speed to meet their exploding energy demands. Coal use is increasingly exponentially, and our K-Fuel process gives them a bridging technology to get more heat for less pollution while so-called “future-gen” technologies are being developed that will either make coal completely clean or replace it with something as efficient and economically viable. The need for carbon measurement is equally important in these growth economies because they want to monetize their efforts to be environmentally responsible. We have many initiatives and business developments underway in the United States, and expect to be making announcements soon.