Biofuels Have Questionable Path As New Fuels for Transportation

In recent years, fossil fuels, particularly coal and crude oil products, have become politically incorrect. Though they account for more than 75% of all fuels used in the U.S., for a handful of reasons, some groups want to replace them.

The environmentalists are after them because of the ways they are produced from Mother earth, processed and refined and for the combustion products released which included large amounts of “greenhouse gases” (GHG). Economists are after them because of the tremendous impact on the U.S. balance of trade from buying about 14 million bpd of oil from foreign sources.

In the major segments of the U.S. where fuels are used – transportation; heating; electric generation and industry for heat and raw materials – there are some alternatives already on the scene making inroads as possible substitutes. They will not significantly replace fossil fuels in the short term for two reasons: first, it takes time and money to develop wind, solar, biofuels, and nuclear and, just as important, some of the same groups that oppose fossil fuels do not like the alternatives!

Nuclear supplies about 20 percent of the energy for electric generation. Though there is renewed emphasis on using nuclear as a power generator, no new plants are on the drawing board and cost, safety and public opinion will play a role. Wind and solar are drawing attention as electric generators but still play relatively small roles. Wind and solar provided just 1.3% of U.S. electric generation in 2008. They face a long, slow climb before they can begin to replace coal and natural gas in electric generation.

Biofuels become important in transportation. Liquid fuels are the major products used today. Regardless of how the all-electric car develops, liquids will still be needed for the next couple of decades.

Already biofuels have established a place in this market. They are liquid fuels produced from biomass materials and fall into two major groups: ethanol and biodiesel. In 2007, the latest full-year data available from the Energy Information Agency (EIA) shows 6.7 billion gallons of ethanol and 358 million gallons of biodiesel were consumed in the U.S. To compare against total liquid fuels consumed in the same year for transportation, 136 billion gallons of gasoline and 53 billion gallons of diesel fuel were used (not inclusive of biofuels) meaning ethanol comprised less than 5% of the gasoline market and biodiesel was about 0.7% of diesel products sold.

Ethanol - the same alcohol in beer and other beverages - arose as a second-generation biofuel and is now the leading biogenerated fuel. It replaced the methanol compound, methyl tertiary butyl ether (MTBE), which was initially added to gasoline to make its combustion products more environmentally friendly. MTBE was phased out when concerns were raised about leakage of methanol compounds into groundwater systems. Ethanol gained additional market share because of government rulings; the Renewal Fuel Standard requirements of the Energy Policy Act of 2005 played a big role in promoting ethanol.

In December 2007, the Energy Independence & Security Act of 2007 increased the amount of renewable fuels to be incorporated in gasoline to 36 billion gallons by 2022. Ethanol produced in the U.S. is made much the same way beer is produced from fermentation of grain or other agriculture products.