Are Biofuels Worth the Investment?

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Environmental scientists at Argonne National Laboratory, study potential biofuel crops.

Environmental scientists at Argonne National Laboratory, study potential biofuel crops. (Photo by George Joch. Courtesy Argonne National Laboratory)

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PUBLISHED NOVEMBER 11, 2013

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iofuels are at a crossroads. According to the International Energy Agency, global biofuels production has grown more than sixfold over the last decade, yet biofuels still account for just 3 percent of all road fuel energy. While it may seem preferable, in theory, to make fuel from plant matter rather than oil,  the reality of producing biofuel comes with its own costs and questions. (For more about biofuels, see "Biofuels at a Crossroads.")

Corn-based ethanol, the world's dominant biofuel, raises land, food, and water issues associated with growing more crops for fuel feedstock. (See related story: "Drought Withers U.S. Corn Crops, Heats Debate on Ethanol.")

There has been a great deal of investment and hope placed in next-generation biofuels—cellulosic ethanol and other advanced plant- and waste-based fuels that could displace gasoline and diesel fuel in a big way without the resource constraints of ethanol. (See recent related stories about fuel from whisky and microbes.)

But advanced biofuels have not scaled up as quickly as many have hoped. In the United States, for example, there are moves to repeal or scale back a mandate requiring oil refiners to blend increasing amounts of biofuel into the U.S. transportation mix. Domestic production of cellulosic biofuel has not met the government's projections, and enthusiasm for continued ethanol subsidies is low.

Should we continue to invest in biofuels, despite what many view as slow progress so far, and the criticism that the business cannot stand on its own without government subsidies?

34 comments
Dornadula C.
Dornadula C.

They are land intensive....calculate the energy we need and the land needed for bio fuels. BC is an additional problem to tackle.

Phyllis Wisely
Phyllis Wisely

My husband is one of those "graying farmers" and has also been involved with ethanol plants in our area.  He is a good steward of the land God gave him to tend and is conscious of how his farming practices affect the environment.  I wonder if people know that, after processing for ethanol, at least a third of the corn comes back as Dried Distillers Grain which is very high in protein and is sold as desirable animal feed.  Also, the corn oil is recovered for diesel fuel. Ethanol as an additive to gasoline has helped clean the air and has replaced MTBE in gasoline - a known carcinogen.  There are over a thousand uses for corn, and ethanol is one that adds to the arsenal of alternative energy sources that will help keep us energy independent. 

Christopher Bush
Christopher Bush

There are wild dynamics to these questions, and many of the comments. We see the primary issue as the waste and wasteful practices of how most of these things are done. It is commented below that algae is an answer, but the energy required to grow and get it out of the water kills that play. Besides that, it can yield exponential economic return in nutrition products than fuel.


We have designed a duckweed based biorefinery that cleans water at a land based fish farm, drastically reducing the environmental footprint. The plants are harvested and fermented, yielding far more starch (sugars) than corn, and the stillage is a protein isolate that can be fed back to the fish. We start with "waste" water, make energy, and have food as an outcome. The key is to address the food/energy/water nexus together. There are no barriers to doing this in the heart of a city, eliminating logistics (food miles) also. We also can attach this solution to anaerobic digesters that process dairy and poultry manure, producing renewable natural gas as well.


We should be leveraging the abundance of natural gas now, as there are many ways to get biogas, which further help the environment. Abbotsford BC Canada is leading the way on this.

Uttam Jaipuria
Uttam Jaipuria

The global food inflation is partly due to Biofuel particularly Corn based Ethanol. Priority should be changed to biofuel from Crop Residues. Another interesting option can be Algal Biofuel. Huge Arid regions near seas (like Rann of Kutch Gujarat) can be used for such Algal Oil. I understand that Salt water Algae is there and this can be very big biofuel option without affecting food production.

Ole Hendrickson
Ole Hendrickson

Food production should have priority over vehicle fuel production. Targets for the percentage of bioethanol (mostly from corn) or biodiesel (mostly from palm) in vehicle fuels are unwise. Biofuels (in the larger sense, think of Finland’s wood-fired cogeneration plants) should be part of the energy mix but are not a ‘magic bullet’ (along the lines of Roger Sedjo’s notion that pulpwood can fuel the world). We could learn a lot from energy return on investment and life cycle analyses of different energy sources. International data sets would be helpful.

Dr.K DPandey
Dr.K DPandey

As suggested by O.Charpantier,the OCEANOGENIC POWER should be harnessed.

al loomis
al loomis

once we reduce human population below 1 billion, these problems will resolve themselves.

how to do? convert babies into a protein source, with a subsidized high price, and adjust this price for a smooth and rapid reduction of human population.

or, wait for war and environmental collapse to achieve a roughly similar result, at great expense and suffering, with the chance of extinction of homo not-so-sapiens.

prashant
prashant

poor countries will grow biofuel crop for rich nations for money,on the expense of the hunger of their fellow countrymen.so this will be devastating for the stability and peace of the world.as well as it will need lots of water and other resources. only viable and best answer is SOLAR ENERGY. available to rich and poor equally .

Martin Kral
Martin Kral

While I live near every energy source known to man (except oceans) I am currently troubled that France actually wants to reduce the amount of the most energy dense form there is: nuclear. France has proved that nuclear is cleaner than all other sources and they have made is safe and economical through standardization. In my opinion, nuclear needs to be advanced because it will have the least impact on the environment long term.

Julesh Bantia
Julesh Bantia

Investing on biofuels are definitely promising and will yield great returns.
What needs to be asked is how far is the govt willing to go on providing initial subsidies on select raw materials that help industrialists. After all bio fuels, especially bio diesel is the only alternative to fossil diesel. How can a company in India at least, imagine to run his power generator sets while prioritising emission reduction?

Osmand Charpentier
Osmand Charpentier

No invited us, or are marginalizing us because we have the solution that contradicts what they think, those who use their money to proclaim themselves geniuses of mankind.

We have been designated by the IEEE in our country ‘, to represent them in CONCAPAN 2013 in Guatemala, because our presentation: OCEANOGENIC POWER.

I invite you all there, on November 14 for us to talk about it.

Is hydraulic energy, taking advantage of the cosmic phenomenon that occurs in the oceans of the earth, and that only from Panama, with HTS lines, allow to carry anywhere in the world, clean energy.

Clean, cheap, enough, scalable and renewable. 1 cent the kwh, for future 500 years or more, and sufficient to displace all dirty fuels (nuclear and carbon based, also biofuels). In less than seven years.

Simone Lovera
Simone Lovera

Every hectare of land destined for bioenergy production is a hectare that cannot be restored into a forest or other carbon rich ecosystem anymore. Industrial bioenergy production is one of the biggest threats to the world’s forests and other ecosystems, and the threat that receives most subsidies and other support – from environmental budgets!

Tom Kucharz
Tom Kucharz

http://www.stopbadbiofuels.org/

Why despite ten years of accumulating evidence on the social and environmental cost of agrofuels, does the European Commission persist with its failed policies? An analysis of the EU’s bioeconomy vision, how it is fuelling land grabs in Africa, the agrofuels lobby that drives policy, and the alternative visions for energy that are being ignored.

Shortly before the new millennium began, the EU embarked upon a major agroenergy and bioeconomy experiment. The EU began with agrofuel as the first major step toward an envisioned overall shift: from fossil resources to agromass as a source not just of energy and fuel, but also of food, feed, fibre and chemicals. This is the so-called ‘bioeconomy’ — and it is the leading technological version of the ‘green economy’ regime first promoted by the United Nations Environment Programme (UNEP) and the Rio+20 process.

More than ten years into this experiment, the evidence from science, academia, and grassroots voices is emerging ever more clearly: most of the claims initially made for agroenergy as a genuinely renewable alternative to fossil fuels are flawed.

Life cycle assessments of agrofuel greenhouse gas emissions that include the effects of indirect land use change show that the supposed emissions savings claimed for agrofuels are greatly overestimated; and when all impacts are considered, they are generally worse than the fossil fuels they replace. Meanwhile, the creation of an EU market for industrial agrofuels has been shown to have a negative impact on the land and resource rights, livelihoods, and food security of local populations, especially in the global South. These same concerns hold true for agromass.

Despite the accumulating evidence, however, the European Commission (EC) is persisting with its agroenergy policies, resolutely refusing to change targets that were demanded by industry from the outset to provide security of investment in the sector. Rather than heed the evidence, the EC has instead responded to criticism with a combination of measures that many observers regard as wholly inadequate, since they rely on voluntary adherence to sustainability criteria and on as yet unrealised (and unrealistic) ‘advanced’ technologies such as second-generation agrofuels, among others.

Today we are at a critical juncture. The two directives which are the cornerstones of the EU agrofuels policy – the Renewable Energy Directive (RED) and the Fuel Quality Directive – are beginning their bi-annual review processes, and post-2020 policy and targets are already being formulated. At the same time, and apparently without reference to the unfolding failure of agrofuels, EU incentives and support for biomass is steadily rising. In this context, it is essential that these agroenergy policies and their underlying assumptions continue to be challenged.

By critically analysing the origins, claims, and effects of the European Union’s (EU) transition to a new bioeconomy, this report aims to contribute to challenging this strategy. A central part of the discussion focuses on the failure of the EU’s agrofuels policies to deliver the low-carbon, sustainable, and pro-rural development outcomes envisaged for them. It highlights ways in which EU policy is contributing to a reordering of land and land use especially in Africa.

Behind all the EC’s assumptions, claims and evasions regarding agrofuels and agromass, lies an extremely powerful industrial lobby that includes the motor industry, the oil industry and the various energy industries. The report will therefore also examine how the constellation of forces that make up the agroenergy lobby have managed to steer EU policy to their benefit. This agroenergy lobby has been able to succeed due to their alignment with the EU’s grand plan for a bioeconomy,understood here as a managerial project based on the capitalistic appropriation and conversion of renewable biological resources to facilitate a market-based, techno-centric response to unsustainable energy patterns.

More generally, the EU sees in its promotion of the bioeconomy a chance to secure a global leadership role. Yet in presenting the bioeconomy as the ultimate win-win strategy, the EU is closing the door to genuine alternatives and much bolder policy decisions to reduce energy consumption and prioritise the exploration of a less energy dense development path for Europe. Only by tackling this overarching narrative can the EU’s policy lock-in with respect to agrofuels and agromass be overcome.

Bill Blackley
Bill Blackley

Hydrogen fuel derived from solar energy would be a far better choice. The byproduct of hydrogen combustion is water and oxygen rather than carbon dioxide.

Annual crops grown to make biofuel take energy to grow, harvest and transport and they still produce CO2 when burned.

We could use that land to feed people and/or grow hard wood that sequesters carbon.

We need to get away from carbon as a fuel and work toward solar, wind, water and hydrogen forms of creating energy.

John Mccampbell
John Mccampbell

Fuel from algae is the answer to 100% of our direct diesel fuel needs. Algae can produce up to 50% of their body weight in vegetable oil, and they divide every 8-12 hours. You could harvest 50% of your total algal weight EVERY DAY, It’s the ultimate in ease of production. An area the size of New mexico could produce enough algae to power ALL of the Diesel fuel powered vehicles in the entire US, Trucks, boats, even power plants can use this type of biofuel.

Sibabrata Acharjee
Sibabrata Acharjee

Gas to Liquid and Coal to Liquid, Solar Energy are feasable at present.

Peter Javsicas
Peter Javsicas

In my view we should stop investing in biofuels and use the funds for innovations in energy conservation. Do the math: life-cycle costs of producing energy from biofuels add up to minuscule or negative energy gain. To use food crops like corn only drives up the cost, putting them beyond the reach of third world and low-income people. Corn and alternative forms of biomass already have more valuable and efficient uses that are environmentally sound. Wheat straw for example can be used as livestock bedding, composted and tilled into the soil. Wood “waste” also can be used as bedding and ultimately composted. Switchgrass and whole trees are hardly “residues.” Switchgrass should be left where it is, to hold and enrich the soil. Switchgrass and of course trees are essential elements of a healthy environment. They can’t be simply subtracted without negative consequences such as erosion and a reduction of carbon dioxide to oxygen conversion, to say nothing of the devastating impact to the whole ecological system. In sum, there is no such thing as “marginal” land, and there is no such thing as agricultural “waste.” Meanwhile, worldwide energy consumption continues to grow at such a rate that more coal-fired plants are coming on line. Oil is getting more and more expensive to obtain. Fracking oil and natural gas threatens our water supply and is even implicated in earthquakes. And the most optimistic projections of clean, renewable energy production won’t be enough. Short of some unimagined new source of energy, we mus find ways to reduce consumption.

Paul Bryan
Paul Bryan

Are biofuels worth the investment? Obviously not to private investors, because they are not investing in droves. I believe that there are significant SOCIETAL benefits to the sensible development of biofuels, but as things stand, none of those benefits will put a penny in the pockets of private biofuels investors. Meanwhile, investors in international exploration and drilling for conventional oil & gas do not face penalties for the multiple well-known problems caused by the use of petroleum products, and their massive profits are not taxed at rates even close to what it would take to counter those problems. Until biofuels investors can benefit from the good they do, or petroleum investors are forced to pay for the harm they do, private investment in biofuels simply will not happen at any meaningful level.

Papaknows
Papaknows

The amount of petroleum energy used to grow corn is high. ie plowing, planting, fertilizing harvesting, transportation etc. There is not a shortage of petroleum fuel with the advent of the abundent source of natural gas and we have no need to supplement it with biofuels. The corn would better used as food. The earth would be much better off if we simply planted trees on this land. One planted they would need no additional energy to maintain and clean the atmosphere more effectively then any other source.

C. Henricks
C. Henricks

Corn ethanol is condemned as not competitive by many. Yet I question how this “fact” is decided on.

Brewer’s mash is a very good livestock feed. When used as such it displaces use of raw corn for those same feeds. So every acre of corn grown and used in this manner does double duty for people. 1) fuel additive to be blended with gasoline & 2) Livestock feeds to help produce meet for people……food.

The major issue at this time is that not all brewers mash is used for livestock feeds & every pound wasted leads to the idea that corn ethanol is a bad idea.

And marginal lands that do not produce well when used for grain crops for people can and should be used to grow switch grass or other fuel crops that can help off set the use of petroleum fuels.

Every gallon of bio fuels produced extends the time we will have meaningful amounts of fuels from petroleum. A good thing, in every way.

Joseph
Joseph

As long as the term “biofuels” is being used solely as a reference to ethanol, then no. It isn’t worth the investment and never will be.

Bob Hill
Bob Hill

Biofuels are a very promising method of providing fuel without increasing the release of greenhouse gasses into the environment. But consistent with other comments here, production of these fuels should not compete with the production of food. Possibilities are use of waste products and the production of fuel from algae. There are undoubtedly other feedstocks and methods that could also be used. This is where further research should concentrate.

Sami Lakkis
Sami Lakkis

Biofuels can’t be a solution to replace the crude oil and it can’t do it . It is preferable to keep vegetables to feed human kind and/or to produce vital oxygen for living beings. The best solution to produce industrial energy is to develop the renewed sustainable energy from the sun, the wind, the seawaves and tide, rivers, etc…

norman
norman

Personally, if the land is capable of growing a crop, it should be to grow food for consumption, full stop. Humans are more important than cars. The “cost” of developing biofuels should at least adequately factor the impact it has on food supplies for agricultural feed and people.

Fernando Leza
Fernando Leza

Some biofuels are very efficient, for example ethanol from sugar cane. Many articles written in the USA or by American authors do not bother to differentiate between the more inefficient options such as corn based ethanol. Furthermore, I have read many arguments against biofuels because “they raise the price of food”. This world has a serious imbalance whereby the rural populations are extremely poor and migrate to urban areas to live in squalor so they can be exploited and abused as cheap labor. Thus I see it as a positive if the price of food increases because it does improve the life of the rural poor.

Cary A Veith
Cary A Veith

It is a complex issue with many moving parts. Corn ethanol is not the optimum biofuel, but is a good start in trying to reduce foreign energy dependence and improve the environment. I’m not in favor of MeOH fuels as they are more miscible with water and would create additional infrastructure, logistics and materials compatibility issues. Rather, more hydrocarbon content fuels are preferred, such as C3 & C4 alcohols. From stoichiometry, we have to look at the C to O balance in the fuel that comes from sugar to make the economics competitive. As such, C3 and C4 alcohols are good next gen candidates, as they have enough O:C to be at satisfactorily high enough yields from sugar, yet give enough hydrocarbon character and unit energy to be useful and productive as a fuel. So bottom line (well, not really), we have to invest in R&D to economically solve the deconstruction of biomass challenge for Gen2 biofuels in order to obtain competitive sugar feedstocks to make biofuels a widespread reality. That is where Federal financial assistance can help us solve the technology and engineering barriers of making biofuel from agricultural and forestry (waste) materials (e.g. corn stover, sugar cane bagasse, energy crops, etc.).

Paul Bryan
Paul Bryan

Based on the cost of extraction, processing, and distribution alone, biofuels cannot come anywhere close to competing with the cost of petroleum-based fuels (bear in mind that the COST to produce a barrel of crude oil averages less than $20 globally). They are beginning to become competitive on a PRICE basis, but it is always risky to invest in a business where you might make 5-10% ROR when your competitors are part of a supply chain where net profits of 300-400% are common. Crude oil prices will hold ONLY until the market share of biofuels and other alternatives becomes an annoyance for conventional oil producers.

Don’t get me wrong, I am a strong advocate for biofuels, but for the most part their advantages relative to petroleum-based fuels, under current regulations, do not result in any penalty for those in the oil business nor any profit in the pockets of biofuels investors (rural jobs, balance of trade, GHG emissions, risk of spills, energy security, etc.).

Unless these factors can somehow be converted to profits for biofuel investors or penalties on petroleum-based fuels, biofuels investments will be marginal at best and very risky on top of that.

Finally, any improved regulatory environment MUST be bipartisan, In the current political environment, anything enacted by the Party in power at the moment will simply be rolled back when the other Party gets in. Think “Obamacare” — had the Republicans taken control in 2012, much of that would be rolled back by now. I’m not arguing for or against Obamacare — my point is that it was a major piece of legislation with massive regulatory impacts, and who wants to make large investments predicated on regulations that could be completely reversed every 4 years? Investments in the energy business are enormous — up to $500 million for a world-class “biorefinery” — and obviously investors are not willing to place those kinds of funds at risk (beyond one-time “trial” facilities) in today’s financial an political environment. EISA and LCFS are flawed, but they are steps in the right direction. But the marketplace clearly does not believe that they can be relied upon to stand in the face of concerted lobbying efforts and possible changes in political “leadership.”

Esther M
Esther M

If getting government subsidies is a strike against biofules, then shouldn’t it also be a strike against fossil fuels? Fossil fuels are heavily subsidized by the government, so why should and could biofules stand without goverment help.

David Kolsrud
David Kolsrud

We need biofuels due to the fact that we are consuming fossil fuels at an alarming rate. For Example: The Bakken oil formation in North Dakota is an estimated 7.5 billion barrels of crude. We get about 20 gallons of gasoline out of a barrel which equals 150 billion gallons of gasoline. That’s a lot but we consume 135 billion gallons per year. If the Bakken was the US sole supplier it would last only 13 months.

Bill Brandon
Bill Brandon

You present a somewhat biased and inaccurate introduction to get a meaningful poll reslult.

fred clarke
fred clarke

A poll sponsored by Shell and the other big oil companies, is prima facie a bogus thumb on scale survey.

Jay S
Jay S

Instead of ethanol, we should concentrate our efforts on methanol, which is sometimes referred to as “wood alcohol”. This can be made from anything that use to be a plant, including grass clippings, leaves that fall from trees, wild weeds etc. For an excellent treatise, see Dr Robert Zunrin’s book “Energy Victory”. The book details how the USA can free itself from OPEC’s grip within a short time, as soon as a 2-3yrs, depending on how fast one key piece of legislation he proposes can be passed.

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