In a way, coal, natural gas, and petroleum are biofuels. They come from once-living beings now fossilized. The ancients around the Mediterranean used olive oil for fuel. That’s more what we think of as biofuel. Today, the most-touted biofuels are ethanol and biodiesel.
In principle, biofuels ought to provide an alternative to fossil fuels, making them unnecessary. It seems like the promise is always off in the distance. Is it at all possible to realize the promise? If so, what’s holding it up?
Once upon a time, ethanol seemed to be a path to energy independence. After all, our farmers could grow it. But the cost of water, fertilizer, fuel for farm machinery, etc. means that ethanol from food crops requires more energy to grow and manufacture than it provides to the end user.
The Bush administration began to promote making ethanol from non-food crops such as switchgrass in the 2006 State of the Union speech. Switchgrass and other suitable crops grow on marginal land that can’t support food crops. They are a less expensive feedstock than corn or sugar. What’s not to love?
Ethanol from switchgrass has to pass two important technological hurdles. Most seriously, they require a much more complicated chemical process in order to produce ethanol. Second, they are very dense and expensive to transport. Those two problems more than offset the cheaper price of the feedstock.
A little over a year ago, when a company called Chemtex announced plans to build a refinery for making ethanol from non-food crops, I wondered if success were on the horizon. That plant officially opened earlier this month. Having a new plant does not guarantee that it will become financially successful, but it’s a very important milestone.
Several years ago, I saw a demonstration of a old school bus redesigned to run on used vegetable oil. Think of how many restaurants have the daily problem of disposing of the oil used to make fried foods! They could sell it—or even give it—to companies who would make biodiesel from it.
If I recall correctly, the bus ran directly on waste cooking oil. It’s much more practical to convert oil into biodiesel. That way, it is not necessary to modify the engine in order to use it.
Recycling any waste product is a good thing, but as much fried foods as Americans consume, it doesn’t produce enough feedstock to power all of our diesel engines. Biodiesel can also be made from soybeans, which are directly or indirectly a human food crop. One acre of soybeans can produce about 50 gallons of biodiesel every season.
A company in North Carolina, Patriot Biodiesel, is manufacturing biodiesel from algae. Keep in mind that algae are one-celled plants and about 30% oil—vegetable oil! Whenever some are harvested to extract the oil, the remains can simply go back into the tank to feed the rest of the algae.
They grow rapidly. In fact, an acre of tanks of algae can produce about 50 gallons of biodiesel every day! Patriot Biodiesel now owns 20 acres of land and plans to buy 100 more acres soon. That much land will enable it to produce 5 million gallons of biodiesel every year.
A tank farm does not require prime farmland. Marginal land works just as well for growing algae as it does for switchgrass. In fact, Patriot Biodiesel’s current property is located near a major petroleum tank farm. There is no reason why the company’s operation could not be duplicated anywhere in the country.
Developing the technology to make a product is not at all the same as developing a distribution network to market it. Existing diesel engines could operate on pure biodiesel. Just try to find it at any retail filling station.
Biodiesel appears most commonly in 2-5% blends. Biofuel’s potential to replace petroleum as a transportation fuel will never be realized at that rate. It appears to require at least a 20% blend to achieve measurable environmental benefits.
Manufacturers of biodiesel currently market to fleet managers. Trucking companies, bus companies, for example, own many vehicles and fuel them on their own property.
While it may not yet be possible for a truck to pull into a truck stop and find biodiesel, at least it can leave company headquarters with any amount of biodiesel the company chooses to buy.
Ethanol from non-food sources has a somewhat different problem. Because switchgrass is so expensive to transport, it only makes sense to haul it short distances. Chemtex’s new plant will have to rely on feedstock grown no more than about 50 miles away.
In other words, ethanol from switchgrass cannot supplant ethanol from corn until small refineries pop up all over the country within a short distance of the switchgrass farms.
Political and regulatory obstacles
Making ethanol from food crops is a bad idea, but it has powerful political friends. Industry lobbyists will not easily turn the profits from ethanol over to a completely different set of farmers and manufacturers.
For that matter, the petroleum industry will not roll over and turn their fuel business over to any kind of biofuel industry.
One of the strengths of our political system is that Presidents operate under term limits. Voters can easily one administration or Congress with another with a very different agenda. One of the weaknesses is that regulators, bureaucrats, and lobbyists can outlast elected officials.
The Bush administration made a major commitment to biofuels. Besides actively promoting ethanol from switchgrass, it instituted renewable fuel standards, requiring a certain minimum of biofuels in retail petroleum fuels. The Obama administration has proposed softening those standards.
According to conventional wisdom, Democratic administrations are much friendlier to the environment than Republican administrations. That’s conventional foolishness, based only on party rhetoric.
In reality, the staffs of cabinet departments and regulatory agencies don’t change much when a new administration takes over. They know they will outlast their political bosses, but not the lobbyists.
Similar situations exist in every state. Until environmental lobbies become as well organized, disciplined, focused and, yes, funded as, say, the petroleum and farm lobbies, the party in power, for better or worse, will not act according to the rhetoric it puts out to its base.
I have mentioned that ethanol refineries using switchgrass must necessarily be small and decentralized. Under current models of venture capital, that almost guarantees that they will have an unreasonably hard time securing funding.
Companies that quickly grow large and come to dominate their industries might very well be the fastest and safest ways for venture capitalists to receive a profitable return on their investment. Companies with an interest in sustainability cannot operate and grow that way.
This post has already gotten longer than I intended, but I have addressed this issue already in an earlier post, where I suggested that we need a “slow money” analogue to the “slow food” movement.
Chemtex biofuels refinery to make ethanol from NC crops in Sampson County / John Murawski (News & Observer, December 2, 2013)
Biodiesel: America’s first advanced biofuel
Fighting the power structure / Taft Wireback (News & Record, December 8, 2013)