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Killing fungi and bacteria, the Aussie way

Australian company Ioteq says the iodine in its Isan system will kill bacteria better than chlorine or ozone will--and it won't cost more.

HALF MOON BAY, Calif.--Chlorine is bad for you, and iodine isn't, points out Jared Franks, CEO of Ioteq, and that difference is the basis of the company's business.

The Australian company has come up with a water purification system that kills microbes with iodine rather than chlorine or ozone. Ioteq's Isan system basically immerses fruit and vegetables in iodine-soaked water, and monitors the iodine dosage.

After purification, the produce gets bagged and sent to grocery stores. The process leaves a minimal iodine residue that is not harmful to people--and it doesn't change the flavor, Franks said. Iodine is a nutrient used by the medical profession to clean germs. The residue can also be washed off.

Not only does the iodine kill microbes, it extends the shelf life of produce. Some Australian customers are able to keep cherries on store shelves for eight weeks--far longer than normal, Franks said during a presentation and a meeting at the AlwaysOn Venture Summit West here Friday.

The water in the Isan system can also be used several times, which cuts processing costs. The system sucks the iodine out of one purification cycle and sends the water back to the start of the process. With water in short supply in places like Australia and California, that's a big deal, Franks said.

While Ioteq currently sells its products to food growers, it hopes to branch into the municipal-water market, selling large-scale systems to water districts.

It has installed 150 systems so far.

Agriculture and water are often overlooked, but they are two of the growing wings of the clean-tech market. Organic produce is booming, and grocery markets and organic growers, of course, can't use chemicals to kill fungi or bacteria.

Farmers, meanwhile, have been stung by spinach recalls. Municipal-water districts are currently going through upgrades of their systems. And consumers complain about the chemical taste of tap water.

As a result, companies such as AgraQuest have devised biopesticides while others, such as Novazone, have come up with ways to disinfect harvested food with ozone.

Ioteq claims that it has an advantage over ozone systems in capital cost. Its purification systems cost only $5,000 to $15,000, less than the equipment required for ozone treatment, he said. (Novazone has said its systems cost closer to $100,000, but the throughput of the systems is different. I'll try to do a more detailed comparison later.)

Interestingly, Ioteq doesn't make much money on the hardware. Instead, the profits come from selling iodine to its installed base. The iodine market, Franks added, is fairly stable. It comes from Chile and Japan, and the price doesn't fluctuate much.

Chlorine as a chemical costs less, he admitted, but Ioteq's Isan system needs fewer chemicals to get the job done. The Isan system needs only about 30 parts per million of iodine to clean fruit. Chlorine needs about 200 parts per million.

As they say in the water business, it's a wash at that point.