Download Biofuels Policy Brief

To: Steven Chu, Secretary, U.S. Department of Energy
From: Dr. Y
Date: September 13, 2010
Re: Role of biofuels in America’s domestic energy portfolio
As we enter the second decade of the millennium, it is necessary to reexamine the
role of biofuels within the context of America’s domestic energy portfolio. Biofuels are
frequently heralded as a lower-emission alternative fuel source when compared to oil.
Additionally, critics have praised biofuels – particularly corn-based ethanol – for their
ability to reduce the nation’s dependence on foreign energy and invigorate the domestic
economy. Echoing these sentiments, Congress has invested heavily in biofuel
development. Unfortunately, data released within the past several years have made
ethanol’s purported benefits increasingly suspect. The following document attempts to
more accurately evaluate the impacts of biofuel production, and provides
recommendations for how best to advance with domestic biofuel development.
Biofuels have consistently been touted as a low-emission fuel source.
Unfortunately, most models fail to account for several critical components of biofuel
production. These components include emissions released during land-use changes and
the transportation of feedstocks. When all emissions sources are accounted for, explains
the World Resources Institute, “…most of today’s biofuels actually lead to an increase in
GHG emissions compared to gasoline or diesel fuel.”1 The negative impacts of biofuels
often extend far beyond the realm of greenhouse gases. For instance, irresponsible crop
management can also result in “nutrient runoff…displacing species…[and] damage to
local ecosystems” (WRI).
The prospect of reduced dependence on foreign oil also makes domestic biofuel
production an attractive alternative to gasoline and other fuels. But once again,
calculations for biofuel production efficiency often neglect critical energy inputs.
According to a recent study presented in Natural Resources Research, “about 29% more
energy is required to produce a gallon of [corn-based] ethanol than the energy that
actually is in the gallon of ethanol produced.”2 Thus, the production of domestic ethanol
is in fact increasing America’s dependence on foreign energy sources.
The economic practicality of biofuel is a more convoluted issue that depends
largely on the level at which production is examined. On a local scale, biofuel
production often offers significant benefits in the form of increased employment,
dividend payments to local investors, and greater demand for local corn and other plants
as feedstock.3 However, corn-based ethanol is highly subsidized in order to compete
with gasoline fuel prices, with producers receiving more than $1.4 billion per year in
government funding (Pimentel). When considered alongside the fact that corn-based
World Resources Institute. 2008. “Plants at the Pump: Reviewing Biofuels’ Impacts and
Policy Recommendations.” Climate and Energy Policy Series: July 2008. 8 pp.
2
Pimentel, David. 2003. Ethanol Fuels: Energy Balance, Economics, and Environmental
Impacts are Negative. Natural Resources Research. 12(2): 127-134.
3
Ethanol Across America. Issue Brief: Economic impacts of ethanol production. June
2006. 12 pp.
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ethanol is not energy efficient, ethanol production appears highly uneconomical from a
national standpoint.
Recognizing the potentially adverse environmental and economic consequences of
current U.S. ethanol policies, it is recommended that the U.S. Department of Energy
adopt a new, three-pronged approach for future biofuel development:
1) Redirect generic biofuel subsidies toward more aggressive investment in the
development of cellulosic ethanol. Future investments in the biofuel industry
must be directed toward only the most efficient, eco-friendly, economically viable
biofuels, particularly cellulosic ethanol. As a fuel source, cellulosic ethanol offers
numerous advantages over corn-based ethanol. Cellulose-based biofuels can be
generated from a myriad of low-cost plant products, thereby reducing prices for
livestock feed and international food supply.4 Cellulosic ethanol’s plant sources
also require less energy to produce and can be grown on marginal lands, offering
a lower-emission, lower-environmental impact alternative to corn-based ethanol.
Perhaps most importantly, early experiments suggest that energy yields for
cellulosic ethanol may be up to three times as high as corn-based ethanol
products.5
2) Improve biofuel infrastructure and automobile compatibility. Biofuels
cannot begin to significantly replace gasoline as a fuel source if they are not
widely available to consumers, nor can they if consumer vehicles are incapable of
using them. In anticipation of increased biofuel production, the DOE should
encourage fuel distributors – through subsidies, tax breaks, or other means – to
begin increasing ethanol and biodiesel-compatible fuel terminals and storage
facilities. Additionally, the DOE must promote the development and production
of more fuel-efficient, biofuel-compatible vehicles.
3) Incorporation of biofuel development into a broader high-efficiency, lowcarbon fuel strategy. Although it is possible that domestic biofuels will
eventually significantly contribute to U.S. energy supply, the reality remains that
ethanol currently provides less than one percent of fuel for the transportation
sector (Pimentel). Recognizing that increasing biofuel production is a slow
process, greater emphasis must be placed on more immediate emission reduction
strategies such as improved automobile efficiency and public transportation.
Additional actions and research are no doubt necessary to ensure an effective biofuel
program. Nonetheless, it is firmly believed that an adherence to the aforementioned
policies will minimize environmental costs, improve national fuel security, reduce global
food prices, and reinvigorate the domestic economy.
4
World Development Report. 2008. Biofuels: The promise and the risks. 2 pp.
Natural Resources Defense Council (NRDC). 2005. Bringing Biofuels to the Pump.
July 2005.
5