Biofuels in Perspective

Bio-Ethanol Development in the USA 53
Finally, as the bio-ethanol industry grows, federal and private investment in fundamental
biofuels research must continue. New enzyme cocktails and more efficient fermentation
organisms are needed for cellulosic feedstocks. And more research is needed to develop
higher-order alcohols with greater energy densities, such as the recent alliance between BP
and DuPont to commercialize bio-butanol.
There is much in recent US policy discussions to suggest that the federal government
will be willing participants in many, if not all, of these areas. Discussions are now underway
on a rewrite of federal agriculture policy. The most recent US farm bill is due to expire
in 2007, and leaders in both the House of Representatives and the Senate have indicated
that biofuels programs – particularly investments in cellulosic feedstocks – will be a major
component of the next farm bill.
Recent legislation introduced in Congress also calls for a greatly expanded Renewable
Fuels Standard, with a growing proportion of fuels coming from cellulosic feedstocks.
Momentum is also building for a low-carbon fuels standard that would require graduated
reductions in the greenhouse gas emissions profile of the nation’s fuel supply over time.
Discussions also continue on a mandatory economy-wide greenhouse gas cap-and-trade
system, both of which would strongly favor cellulosic ethanol. (A growing number of states
have already implemented regional climate cap-and-trade systems of their own, though few
currently apply to transportation fuels.)
All of this suggests that the US bio-ethanol industry is likely to continue to aggressively
expand in the coming decade. The possibility remains that, as in the decades following
the Second World War and the oil shocks of the 1970s, petroleum prices may fall to
a level where bio-ethanol is priced out of the marketplace, sapping public and federal
support for biofuels. But sentiment is growing that increasing demand from China and
other developing economies is likely to maintain pressure on fuel prices. With new policy
tools such as an expanded renewable fuels standard, and growing pressure to regulate
greenhouse gas emissions, expansion of the US biofuels market may be here to stay.
References
1. B. Kovarik, Henry Ford, Charles F. Kettering and the Fuel of the Future, Automotive History
Review, 32, 7–27, http://www.radford.edu/∼wkovarik/papers/fuel.html
2. US Department of Energy, Energy Information Administration, Energy Kid’s Page,
http://www.eia.doe.gov/kids/ history/timelines/ethanol.html
3. Wikipedia.com, http://en.wikipedia.org/wiki/1973 oil crisis
4. US Environmental Protection Agency, press release, Nov. 28, 1973, http://www.epa.gov/history/
topics/lead/03.htm
5. Renewable Fuels Association, http://www.ethanolrfa.org/industry/statistics/#A
6. Renewable Fuels Association, http://www.ethanolrfa.org/industry/locations/
7. USA Today, Jun 21, 2006, http://www.usatoday.com/money/industries/energy/2006-06-21ethanol-usat
x.htm
8. Statement of Keith Collins, Chief Economist, US Department of Agriculture, Before the US
Senate Committee on Agriculture, Nutrition and Forestry, Washington, D.C., Jan 10, 2007,
http://www.usda.gov/oce/newsroom/congressional testimony/Collins 011007.pdf
9. EthanolMarket.com, http://ethanolmarket.aghost.net/
10. R. Schnefp, Agriculture-Based Renewable Energy Production, Cong. Res. Serv., Jan. 8, 2007,
Order Code RL32712