Biofuels Industry Hopes Floodgates Will Open for Cellulosic Ethanol in 2013

For years, the biofuels industry has defended itself against a variety of criticisms over the shortcomings of corn-derived ethanol by pointing to a cleaner, better, non-food-based alternative on the horizon: cellulosic ethanol. But despite a federal mandate requiring gasoline refiners to add 500 million gallons of cellulosic ethanol to the national fuel mix by 2012 (increasing to 15 billion gallons per year by 2022,) the fuel has been slow to get off the ground.

The U.S. Energy Information Administration projects cellulosic ethanol output for 2011 to reach less than 4 million gallons, and next year the EPA is expected to again lower the Renewable Fuels Standard’s mandate to roughly 2 percent of its original level.

So when, if ever, will cellulosic ethanol begin to show signs of living up to its promise? According a research director at one of the nation’s largest biofuels companies, 2013 is now thought to be the new target for widespread commercial production of the fuel, with large-scale facilities from several major companies scheduled to go online. Greg Hartgraves told Bloomberg News that the industry hopes a 25 million gallon-per-year plant from his company, Poet LLC, as well commercial-scale plants by BP and Abengoa will “open the floodgates” for cellulosic ethanol within the next two years.

Though right now it looks as though catching up to the EPA’s timetable for cellulosic ethanol is out of reach for biofuels producers, Hartgrave said that isn’t the case—though he added that continued support from the federal government will be required. “Even if the technology plays out like we believe it will, it’s still not an inexpensive technology, and financing is not a trivial matter,” said Hartgrave. “Without [a] consistent energy policy, it becomes risky for people to invest or finance these opportunities.”

But what has for decades seemed like open-ended government support for biofuels is now one of the chief criticisms facing the industry. Though corn ethanol provides a limited emissions benefit over petroleum and has been blamed for contributing to rising food prices, the Renewable Fuels Standard and billions of dollars in supporting government subsidies have ensured that most gasoline sold in the United States include up to a 10-percent blend of the fuel. Soon, that blend could increase to 15 percent.

Cellulosic ethanol offers a more than four-fold lifecycle emissions improvement compared to corn ethanol and since it is made from inedible plant waste instead of corn, it is expected to have little effect on food prices. Still, with significant production yet to begin in the United States and a the release of a new National Research Council study questioning the longterm legitimacy of the fuel, the the clock is ticking for the biofuels industry to prove that its most promising contribution will ever deliver.


  • Libertarian Don

    More crony capitalism through the fed which borrows 42 cents on the dollar. Get corporations out of government and government out of corporations. Disgusting corruption even if the goal is noble. The US is rapidly becoming a corrupt third world country, first through Bush and now with Obama stomping the corruption accelerator.

    If you want to end our dependence on oil, tax oil rather than subsidize campaign donors like Solyndra, etc.

  • Anonymous

    Cellulosic ethanol is just as wasteful to taxpayers as corn based ethanol. Both are a negative return fuel. In btu’s & dollars!!!!!

  • Bob Brookss

    BP’s 2 $billion and counting investment in energy
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  • MrEnergyCzar

    Another desperate attempt to replicate the power of oil during these peak oil times….

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    I don’t see anyone complaining about the $12 billion that BP will be getting back from our government from a tax loophole for the Deepwater Horizon oil spill? We are so worried about subsidies that provide a future rather than collecting taxes on an established industry. $12 billion divided by our population…what’s your share of this clean up add up to?

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    Thanks for making my point Anonymous. I am complaining about BP and every other big corporation buying favors from our government. One expects this with the credit-card-republican but the true guilty party with big business is the ironically the Democrats who take 2/3′s of the wall street campaign money.

    Crony capitalism is the sure path to socialism and socialism is slavery where the Master is the government. Slavery is where you are forced to work for someone else and in return they provide you with subsistence living. That is socialism. Free market capitalism on the other hand you can work for yourself, another person, the government, non-profits, or a corporation. You are free to succeed and fail based on your actions, talents, and some luck. I’d rather subject myself to some random luck than slavery.

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