BOULDER - Like the idea of spinning straw into gold, it sounds too good to be true, but Deane Little, chairman and chief executive officer, believes New Sky Energy Inc. can deliver.

He's created processes to convert waste streams into revenue streams and simultaneously reduce a crucial greenhouse gas.

"If we achieve our potential," he said, "we could be doing multimillion-dollar deals in a year."

To underscore his point, he displays a beaker containing a white compound. "This came from carbon dioxide in the air over Boulder," he said. While carbon dioxide gas is poisonous, the compound produced by what Little called "game-changing technology" is stable and safe.

Raw materials for New Sky include polluted water, waste salts from mining operations or carbon dioxide scrubbed from the flues of coal-powered utility plants. Output includes carbon-neutral or carbon-negative chemicals, each an ingredient of a manufactured good such as glass, plastic or building materials.

The first stage of the company's process is an electrochemical reaction that yields sulfuric or nitric acid along with sodium hydroxide, hydrogen and oxygen. Little declined to name the waste salts used in New Sky's process. "It's not table salt," he noted.

Carbon dioxide capture occurs in the second phase. Sodium hydroxide absorbs carbon dioxide from the air to form baking soda, limestone or soda ash.

The company holds seven patents related to these processes.

Little believes that global climate change, consumer concerns and regulatory requirements will drive demand for carbon-neutral or carbon-negative products.

Others agree. In its recent forecast, the Battelle Institute, a private research and development organization, cited similar directions as key trends through 2020. To quantify the carbon status of the chemicals it produces, New Sky uses the Greenhouse Gas Protocol, an accounting tool endorsed by the International Organization for Standardization.

New Sky plans to use renewable sources of energy, even though that raises costs. "Ten cents of renewable electricity produces a minimum of 50 cents in product," Little said. Additional input costs include salt and water.

New Sky processes have many potential applications. The company's current focus, said Michael Ashford, executive vice president of business development, is a commercial-level pilot program. In the works is a project to remove groundwater contaminants from agricultural land.

"The value of clean water is less than the cost of desalination," Ashford said. "So the customer needs profits from other products to support desalination."

The New Sky system would yield up to six tons of carbon-negative carbonates per day. In the construction industry, calcium carbonate is a building material. It can also be used in roads or as an ingredient of cement.

"The pilot would demonstrate our ability to execute on a scope of work," Ashford added. "We know the costs. We have the team." He anticipates that it will take six to 10 months to deploy the installation. Six months of operation will suffice to demonstrate that the technology works at a commercial scale.

In addition to the $750,000 this pilot program might garner, New Sky is pursuing $1.5 million in angel funding. Within a year, the company will seek $6 million in venture capital. Early conversations with investors have been promising, Ashford said.

Overall, investor interest in clean technology is growing. In a statement announcing the most recent MoneyTree Report, Mark Heeson, president of the National Venture Capital Association, said the emphasis on clean technology reflects an investment strategy "increasingly focused on industry sectors which require multiple rounds of financing for an extended time horizon."

New Sky expects its first revenue this year. It plans to take significant minority shares in joint ventures to build and operate reactors. Officials believe New Sky will be profitable by 2013, with annual revenues in the range of $12 million.

Competition in the carbon capture market is abundant. Some companies adopt what New Sky describes as a "pump and dump" approach. They capture and store poisonous carbon dioxide gas.

Others, like New Sky, apply the mantra of "reduce, recycle, reuse" and see carbon dioxide as a resource. Carbon Sciences Inc. of Santa Barbara, Calif., focuses on creating fuel. Rennovia Inc. of Menlo Park, Calif., focuses on producing industrial chemicals from atmospheric carbon dioxide.