Biofuels Done Right?

Images from the “slow-motion catastrophe” that began last week 50 miles off the coast of Louisiana brought to mind a bit of sarcasm I offered to a colleague almost exactly a year ago. The NRDC was running the below ad on Capitol Hill, saying, “Biofuels. If we’re going to use them, let’s do it right,” with a picture of the deforestation that many assumed would occur from use of biofuels.

NRDC-- Biofuels Done Right Ad

My facetious idea was to run a counter ad, with pictures from the Exxon Valdez disaster, asking NRDC if they considered “biofuels not done at all” to be done right. And perhaps that ad could have been rerun on March 31, as the Obama administration announced with purely Orwellian logic that plans for expanding offshore oil drilling were “part of a broader strategy that will move us from an economy that runs on fossil fuels and foreign oil to one that relies on homegrown fuels and clean energy.”

Now, of course, 5,000 barrels of oil each day are spilling into the Gulf of Mexico from the ruptured pipes of a deep sea oil well, creating an oil slick covering 400 square miles. While not yet rivaling the Exxon Valdez disaster, where 258,000 barrels leaked, the threat to wildlife and sensitive wetlands still exists. And consider, an estimated 90 rigs drilling in the Gulf of Mexico provide 1.7 million barrels of oil a day, nearly one-third of total US production.

Today, President Obama is touring a POET biorefinery in Missouri and talking about the need for increased biofuel production:

For decades, we’ve talked about how our dependence on oil from other countries threatens our economy. But usually our will to act kind of rises or falls depending on the price at the pump. We talked about how it threatens future generations, even as we witnessed some funny things going on in terms of our climate change, and recognizing the environmental costs of relying on fossil fuels, but, frankly, we always said we’ll get to it tomorrow. We talked about how it threatened our security, but we’ve grown actually more dependent on foreign oil every single year since Richard Nixon started talking about this danger of dependency on foreign oil.”

But of course, cellulosic and advanced biofuel production has fallen short of goals, primarily due to a lack of capital needed for rapid scale up. Investor confidence in the sector was undermined in 2008 and 2009 by a combination of the economic recession, wild volatility in feedstock costs, and predictions of impending doom by opponents of biofuels.

Investor confidence may be slowly recovering, according to recent indications, but the overall mood still remains skeptical. A few of the more choice pronouncements indicate the general mood.

Want to become a millionaire investing in publicly traded advanced biofuel stocks? One way would be to start as a multi-millionaire.”

“Very few investors in any cleantech sector are going to be investing the amounts of capital we saw at the height in 2008,” when venture capitalists were investing in production facilities, says Dallas Kachan, managing director of the Cleantech Group, a research and consulting firm that tracks venture-capital spending in green technology.

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Ways and Means Should Include Job Creation of Advanced Biofuels and Bioproducts in Green Jobs Leg

On Wednesday, April 14 the House Ways and Means Committee will hold a hearing on Energy Tax Incentives Driving the Green Job Economy. The focus of the hearing is to examine the effectiveness of current energy tax policy and identify additional steps that the Committee can take to ensure continued job growth in this area while at the same time advancing national energy policy focus on a discussion of current and proposed energy tax incentives. Witnesses for this hearing have not been announced and we do not know how much of the hearing will focus on transportation fuels however, energy tax incentives for biofuels and biobased products should be a significant area of focus for this round of green jobs legislation. These technologies are ready to deploy and create near term job opportunities.

Industrial biotechnology is the key enabling technology for producing biofuels and biobased products like bioplastics and renewable chemicals to aid in reducing our dependence on foreign sources of oil, thereby reducing greenhouse gas emissions. They also have the ability to crate jobs, jobs that are currently moving overseas due to their reliance on petroleum as a feedstock or more favorable economic or political environments.

The United States has invested considerable amounts of taxpayer dollars to try to revive our economy. Too often, though, the resulting jobs are being created overseas, as other countries invest in green technology deployment. As a result, the opportunity to improve our economic competitiveness is lost. The United States is a leader in the research and development of green technologies, but to maintain that lead we must invest in the companies that are putting that green technology to work in our economy. These industries have shed hundreds of thousands of domestic jobs over the past two decades, as petroleum producing countries have attracted more capital investment. For example, U.S. chemical and plastics companies have increased capital investment outside the United States by 32 percent over the past decade, while increasing investment within U.S. borders by only 2 percent.

The Renewable Fuel Standard (RFS) enacted as part of the Energy Independence and Security Act of 2007 sets the minimum level of renewable fuel that must be produced and blended into the US transportation fuel supply at 36 billion gallons by 2022. 21 billion gallons of that requirement must be cellulosic or advanced biofuels. Direct job creation from the advanced and cellulosic biofuels volumes in the RFS could reach 29,000 by 2010, rising to 190,000 by 2022. Total job creation could reach 123,000 in 2010 and 807,000 by 2022. Jobs will be across many sectors of the economy. Some projected job creation sectors are: labor/freight, mixing and blending machine operators, shopping/receiving/traffic clerks, truck drivers, chemical equipment/technicians, chemical plant/system operators/electrical, sales etc.

The Ways and Means Committee can aid in accelerating this job creation by incentivizing biorefinery construction here in the United States. In 2008 Congress enacted a cellulosic biofuels production tax credit and enhanced depreciation for advanced biofuels facilities as part of the 2008 Farm Bill, both of which are scheduled to expire on December 31, 2012. Due to an overall downturn in the worldwide economy, this tax credit has not yet been utilized by cellulosic biofuels producers. This credit needs to be extended now in order to signal to investors that a plant being constructed this year, will have certainty in the availability of that tax credit once the plant begins to produce the advanced biofuel. A tax credit that expires before or shortly after production begins, does not create economic security for a yet to be built advanced biofuel biorefinery looking for funding. Furthermore, capital costs for construction of next generation biorefineries, which utilize renewable biomass to produce next generation biofuels and biobased products, are a substantial barrier to commercialization. Congress should provide an investment tax credit to help accelerate construction of next generation biorefineries and speed deployment of next generation fuels, chemicals and products.

Historically, the U.S. chemicals and plastics industry was the envy of the world. At its peak in the 1950s, the industry was responsible for over 5 million domestic jobs and a $20 billion positive trade balance for the United States. Jobs associated with the industry were typically among the highest paid in U.S. manufacturing. However, the petro-chemicals and plastics industries are now hemorrhaging jobs overseas. Conversely, biobased products and chemicals production, like domestically produced biofuels, will stay in the U.S., in close proximity to their biomass feedstocks. Total US employment in the chemicals industry declined by over 20% in the last two decades and is projected to decrease further. The US is a world leader in industrial biotechnology with a wide range of companies pioneering new, renewable pathways to traditional petroleum-based chemicals and plastics.

The potential job creation from bio-products is immense. Consider that the nascent biobased products industry employed over 5,700 Americans at 159 facilities in 2007 and every new job in the chemical industry creates 5.5 additional jobs elsewhere in the economy. Currently the biobased products portion represents only about 4 percent of all sales for the industry. Congress should create targeted production tax credits that can help them to expand their share of the market and grow additional domestic jobs. With an industry with the potential to grow by over 50% per year, bio-products can form the basis for a strong employment growth engine for the US.

Clearly commercializing the advanced biofuels and biobased products industries is an integral solution to creating high caliber domestic green jobs in the United States that will catapult this country to be a leader in successful high tech, sustainable technologies. BIO will be urging the Ways and Means Committee through written comments to recognize that innovations such as these are some of the most promising sources of green jobs and economic growth for the future.

Industrial Biotechnology: Biobased Products, Biofuels, and Synthetic Biology

Biobased products cover a wide range of materials.  One new such product is biobased insulation made from mushrooms named Greensulate.

The blog Greenline says that Greensulate,

“…is a bio-base alternative to rigid insulation made from paper, rice hulls, and mushroom fibers.   The product is still undergoing testing but the outlook for this new product is very good.  The insulation takes advantage of the mycellium, the roots of the mushroom plant that have incredible structural and insulation properties.    It requires no power to grow and is flame resistant.   The product also has potential to take the place of packing peanuts, they can be thrown in the garden or used in potted plants after they are no longer needed.”

You can find more information on biobased products and the future of industrial biotechnology on our web site BIO.org.

Cultural synthetic biology—that’s the latest topic for Christina Agapakis on her blog, Oscillator .

Agapakis writes,

“The future potential of synthetic biology is usually discussed in terms of applications in fields like medicine, food science, and the environment. Genetically engineered life forms are being designed to make medicines cheaply, to target tumor cells, to make more nutritious food, or to make agricultural plants that are easier to grow with less of an environmental impact, to clean up pollution or produce sustainable biofuels. What if synthetic biology systems were instead designed for use in culture or entertainment?”

She goes on to talk about acoustic sound gardens, bugs engineered to chew specially designed nuts in rhythm, whistling termites, lilly pad speakers, and popping seed pods.

You can find more information on synthetic biology on our web site BIO.org.

The sources for biomass to be converted to biomass are quite varied.  One example is the poplar tree.  According to the blog, Trees, Climate and People,

“Poplar trees (genus Populus, not to be confused with yellow-poplar, Liriodendron tulipifera) are among the fastest-growing trees in the world, and represent a diverse wide-spread genus of trees.  Poplars are grown in plantations for pulp and paper, and have great potential as feedstock for biofuels production.

Poplars have a lot of advantages as experimental plants, as they grow clonally from cuttings and are easy to hybridize.  The poplar genome has been sequenced, making poplars even more attractive as research subjects and for advanced breeding.

Gary Coleman and his colleagues at the University of Maryland and Bowie State University have just received a $3.2 million grant from the National Science Foundation to take advantage of the poplar genome map to try to improve the prospects for poplars as a biofuel feedstock.”

You can find more information on biofuels and biomass sources on our Web site BIO.org.

From Pacific Rim Summit: Specialty Crops, Renewable Feedstocks & Sustainability

This panel on the second day of the Summit consisted of Richard Gustafson from the University of Washington, Gillian Madill, an independent consultant representing views of the environmental NGO community and John Sheehan, from the Institute on the Environment at the University of Minnesota.

While Mr. Gustafson and Mr. Sheehan gave informative talks on lifecycle assessment modeling and sustainability issues, Ms. Madill lit up the room with her talk titled, “Environmental Concerns with Energy Biotechnologies.” Ms. Madill started the conversation with the assertion that the environmental community and the biofuels community have the same goal, to supply energy in a new way that preserves the environment and our earth. Renewable energy and technology are tools to get to that end.

The environmental community has several valid concerns over widespread biofuels production. They see biofuels as a transition technology on our way to an energy future less dependent on liquid fuels, some would say zero liquid fuels. Zero because of the belief that no biofuels are carbon neutral. The question asked by environmental groups is, Why incentivize an unsustainable industry? Some concerns raised by Ms. Madill on behalf of the environmental community include deforestation of sensitive lands such as rain forests, environmental degradation, incorporation and containment of genetically engineered crops and organisms and intellectual property protection.

The biofuels industry plans to be a sustainable industry, but it is a new industry on the verge of commercialization with a formidable competitor. Ms. Madill’s point was that the environmental community and industry, while striving for some common goals, are currently at odds.

As I expressed to Ms. Madill, at the heart of this debate is the fact that most of the controversy centers around land use and protecting sensitive ecosystems. If biofuels went away tomorrow, other industries would compete for those same sensitive areas. After all, solar and wind farms require significant acreage as well, not to mention building schools or highways or the new grocery store that just opened in your neighborhood. Any industry that has a footprint will at some point, one can only assume in a future low carbon world, be mandated to quantify their lifecycle assessment, including land use and potentially indirect international land use, as biofuels are today.

My suggestion would be to partner to serve the common goal, protection of our vital and sensitive areas and resources which are important and treasured by all.

Industrial and Environmental Biotech in the Blogosphere

This week we start off with a United Nations report that urges caution on biofuels. Green Inc, a New York Times blog writes,

“The study concluded that whether a biofuel is climate-friendly or not depends largely on whether it is based on crops or production residues. Biofuels of the latter category were generally considered beneficial for the environment, and generating electricity locally from waste materials was found — in most cases — to be more energy efficient than converting biomass to liquid fuels.”

This paper was also written about in the blog, Futurism Now, the post called, Biofuels Will Increase Global Warming According to Study

They explain,

“That is because the land required to plant fast-growing poplar trees and tropical grasses would displace food crops, and so drive deforestation to create more farmland, a powerful source of carbon emissions.”

Not so fast, check out the Sustainable Production of Biofuels.

And biofuels continues to be the topic of the week. The biofuel review writes this week about a report from the Imperial College of London. The report has an upbeat tone about the future of biofuels and The biofuel review ends their post with a quote from Clare Wenner, Head of Renewable Transport at the Renewable Energy Association that says,

“Imperial College London has verified the results which show that these fuels can be produced in a sustainable way. With the right legislative framework, including the implementation of environmental rules under the Directive, it will be possible to limit indirect land use effects. Land will always be used for food and fuel, and the overall balance of these impacts could be positive as far as food is concerned. In fact, it seems likely that wheat-based biofuels production will not affect the amount of wheat exported by the EU as a whole.”

Then it’s more biofuels from Creamer Media’s Engineering News

According to Engineering News,

“Pretreatment and gasification technologies are on the verge of making second-generation biofuels a commercial reality, according to new analysis from Frost & Sullivan, entitled ‘Worldwide Market Analysis of Second Generation Biofeedstock.”

Engineering news interviewed Frost & Sullivan senior research analyst Phani Raj Kumar Chinthapalli,

“The use of second-generation biofuels is expected to reduce 
the emission of greenhouse gases (GHG), particularly carbon 
dioxide (CO2), from combustion engines by 80% to 85% in comparison with conventional fossil fuels. The lifecycle emissions for second-generation biofuels are in the negative range, which implies consumption of CO2 rather than emission.”

That’s it for this week, see you next week.

All Your Eggs in One Basket

Biofuels Digest reported this week that DoE Secretary Chu told attendees of an alternative energy conference, “If it were up to me, I would put every cent into electric cars.”

The following day, Biofuels Digest reported its own lifecycle analysis of E85 from corn and the Tesla electric car. According to the report, “cars running on E85 corn-based ethanol at the proposed new Corporate Average Fuel Economy (CAFE) standards will generate 30 percent lower CO2 emissions over an average car lifetime than a Tesla all-electric sports car using coal-fired power. E85 saves an average of 6 tons of CO2 emissions over the average life of a vehicle, when utilizing corn ethanol, and up to 36 tons of CO2 when running on cellulosic ethanol derived from waste biomass.”

Further, “The Digest also found that cars running on E85 corn-based ethanol at the proposed new Corporate Average Fuel Economy (CAFE) standards will generate 10 percent lower CO2 emissions over an average car lifetime than a Chevy Volt running solely on electric power. A Volt using a 50/50 mix of gasoline and electric power would generate 13 percent more CO2 than an E85 car running on corn ethanol.”

The comparisons are of course dependent on the opening assumptions, as are most analyses. And I doubt it will be helpful for industries that ostensibly aspire to reducing carbon emissions to begin tearing each other down. However, I would like to buy Sec. Chu a new t-shirt:

I Heart Electric Cars

I Heart Electric Cars

The Facts of Life on Waxman-Markey

You take the good, you take the bad, you take them both and there you have … the Peterson amendment to the Waxman-Markey bill, formally known as H.R. 2454, the American Clean Energy and Security Act (ACES). According to Grist contributor Meredith Niles, there are a number of positive inclusions in the amendment that were advocated by environmental groups.

The good aspects, according to Niles, are those that will encourage improved agricultural practices. The bad part of the amendment is that the USDA – the agency whose mission is to promote both domestic agriculture (to keep it from moving overseas) and food safety – will oversee the implementation of these positive aspects.

Niles laments that “industrial agriculture interests are overtaking environmental interests in a bill that, again, is fundamentally meant to reduce greenhouse gas emissions.” No doubt, the agricultural interests have a similar lament about implementation of the Renewable Fuel Standard, which was intended to reduce reliance on oil. There is an interesting comment to Niles’ article by ecoplasm, who says, “Selecting ‘scientific’ analytical tools to meet some influence group’s desired result was a hallmark of the past administration’s EPA, hopefully not this one’s.”

A Scientific American assessment of the Waxman-Markey (Peterson) bill shows how much the “science” of indirect land use change has been affected by the rhetoric from environmental NGOs. The article asks, “Should Domestic Ethanol Producers Pay for Deforestation Abroad?,” and states plainly, “the question is not whether there are indirect impacts but rather how big they are.” The reality is that this assumption about indirect land use change – that it will inevitably occur – is built into the model EPA uses to measure it. It’s a perfect example of selecting a ‘scientific’ analytical tool to achieve an influence group’s desired result.

The Peterson amendment proposes a study by the National Academies on indirect land use change. No doubt, another example of carefully selecting an analytical tool. The 2007 EISA bill also contains a provision for the National Academies to study the issue, though funding for the study has never been authorized.

The science on indirect land use change will continue to develop (is currently continuing to develop). The real issues will be whether there are any positive moves toward reducing greenhouse gas emissions once all the politics are done.