Advanced BioFuels USA

by Marissa Luck (Houston Chronicle)  … As Shell’s largest research and development center, the 200-acre Houston campus has 1,500 employees and hundreds of contractors. They’re working on everything from formulating new biodiesel to advancing liquefied natural gas into transportation fuels. Their research also extends into something more tangible in the near term: how to improve gasoline.

Even as Shell opens hydrogen-fuel filling stations in California, invests millions of dollars in electric vehicle startups and develops biofuels, it is still pouring billions in research for advancing its core product, fossil fuels. Shell and other oil companies, such as Exxon Mobil and BP, are investing in clean technologies — and launching public relations campaigns to tout their initiatives — but their fortunes are still tied to traditional cars and the billions of people that drive them.

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Higher returns and ongoing demand for gasoline and diesel will keep investment flowing into fossil fuels for at least a couple of more decades, analysts said.

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Innovations that increase fuel efficiency have changed how fuel interacts with the engine, requiring a change in chemistry to respond to the higher temperatures and higher pressures in many modern engines.

“One thing about the internal combustion engine is that has been improved so much over the years,” Arnold (Sarina Arnold, fuel scientist at Shell’s Houston research center) said. “As engines evolve and become more efficient there are more demands on the fuel, so the fuel formulation evolves alongside the engine development.”

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While automakers such as Ford, Volkswagen and GM boost electric vehicle production, EVs still lag behind traditional cars. There were about 1.1 million electric cars on American roadways in last year, up 361,0000 from the previous year, according to the Paris-based International Energy Agency. But overall electric vehicles and plug-in hybrids still accounted for less than 2 percent of the U.S. auto market, according to the IEA.

“We put a lot of focus on time and effort around gasoline vehicles because still the majority of people who are on the road today are going to be in gasoline (powered car),” said Shannon Bryan, North America fuels manager at Shell.

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The consultancy Boston Consulting Group estimates that roughly half of new cars sold will have some type of electric engine under their hood, including hybrids by 2030. The share of new car sales exclusively powered by batteries will be roughly 20 percent by 2030, according to the consulting firm.

The conventional internal combustion engine, however, will still account for roughly 75 percent to 80 percent of the North American car fleet, according to Boston Consulting Group. The firm expects electric vehicles won’t have a noticeable impact on fuel demand until about 2025 to 2027, said Ilshat Kharisov, managing director and partner at Boston Consulting Group’s Houston office.

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“One of the most important strategic question s that the oil and gas industry is trying to answer is whether to keep their portfolio of businesses or diversify into power business or pursue step-out opportunities, like renewables,” Kharisov said.  READ MORE

GM, Volkswagen Say Goodbye to Hybrid Vehicles; Toyota, Ford plan to keep hybrids as core part of their lineups, showing split in auto industry  (Wall Street Journal)

GM, Volkswagen to ditch hybrid vehicles (Talking Biz News)

Why GM and Volkswagen are ending hybrid vehicles (Fox Business)