Biofuels Industry Fighting Rising Tide of Skepticism

by Sandra I. Erwin (National Defense Magazine) ...Although the Pentagon consumes just 1.5 percent of the nation’s fuel, biofuel investors and green-energy advocates have looked upon the military as a catalyst for a massive expansion of alternative fuel production in the United States.

The Defense Department’s biofuels program is expected to remain strictly a research-and-development effort. The Pentagon does not plan to buy commercial-scale quantities of biofuels until their prices are comparable to petroleum products. The Defense Logistics Agency last year procured 450,000 gallons of advanced drop-in biofuels. Over the next three years, the Navy agreed to spend $170 million to support advanced biofuels, with matching amounts from both the Department of Agriculture and the Department of Energy. Under the Defense Production Act, the government is allowed to invest in an industry that it considers important for national security.

Current first-generation corn-based ethanol is a dollar cheaper per gallon than gasoline, he said. Manufacturers are now transitioning to second-generation cellulosic ethanol, which will be made from feedstocks that are not in the food supply, such as corn stover, wood chips and elephant grass. “Within a few years, cellulosic ethanol will be the same price as corn ethanol,” Welsh said.

The military’s advanced biofuels — made predominantly from camelina plants and algae — are expensive, but there will be cheaper alternatives once commercial production of cellulosic biofuel ramps up, (Hugh C.) Welsh (president of DSM North America, a subsidiary of global giant Royal DSM) said.

...“The oil and gas sectors will continue to push their talking points about biofuel being a ‘phantom’ that doesn’t exist in commercial scale.”

One of the disagreements among experts is over whether biofuels in the long term will remain mostly first generation — made from corn or sugar — or whether advanced biofuels — cellulosic-ethanol and biosynthetic gas — could eventually dominate markets, the study said. “Cellulosic ethanol plants are still considerably more expensive to build than corn ethanol plants in the United States, by a factor of two to three in higher investment costs,” REN21 reported. “Costs will have to decline significantly, although cellulosic feedstocks are cheaper.”

Some analysts believe commercialization is close at hand, while others believe it may never occur, the report said. Factors include developing cheaper enzymes, feedstock prices, technological learning, and sustainability issues. A variety of advanced biofuels are in research stages that may one day achieve commercial viability, the study said. “Experts pointed to several possibilities, including biomass-gasification-to liquid conversion, sugar-to-biodiesel conversion using yeast fermentation, bacteria for producing biodiesel from cellulosic materials, and algae as a potential biofuel feedstock.” READ MORE