Forget about corn, US pushing cellulosic ethanol

October 17 2008 / by Garry Golden
Category: Energy   Year: Beyond   Rating: 2

The Associated Press is reporting (MSNBC / Forbes) that the US EPA is changing the rules on ethanol production to eliminate the political headaches of corn-based ethanol production. Long-term biofuel production is now expected to come via next generation cellulosic ethanol production that uses enzymes capable of turning biomass waste products into usable liquid fuels.

New Targets push Cellulosic Ethanol
The article describes a new mandated goal of converting biomass waste (e.g. wood, grass, and garbage) into 16 billion gallons of cellulosic biofuels annually by 2022. This would be just under half the expected 36 billion gallons of biofuel to be blended into the US liquid fuel supply. But the most important piece of news is the ceiling placed on corn-derived fuels at 15 billion gallons by 2022.

Good News for Bio Industrial Startups
Corn based ethanol is not going away anytime soon. Farmers and big agricultural giants have already invested hundreds of millions of dollars based on the first wave of government policies. But their growth prospects now appear to be severely limited.

The smart money might now begin to shift towards biofuels derived from non-food crop resources driven by cellulosic conversion. The risks are still high given the complexities of next generation biofuels production. But this is good news for bio industrial start ups that go beyond corn feedstocks – Mascoma, Iogen, Verenium, Bluefire Ethanol Fuels, Pacific Ethanol, Novozyme, RangeFuels, Ceres, Coskata

Challenges ahead for cellulosic ethanol
(Keep reading…)

To achieve the government’s goal, the US will have to construct hundreds of large-scale biorefineries (100 million gallons/yr) to meet government targets.

There are still significant technological challenges to maximizing cellulosic biofuel production. Scaling is the default ‘big barrier’ in competing against corn. Leaving behind all the obvious downsides of corn based fuels, the agricultural industry can scale to meet government mandates. And one expects that corn-ethanol lobby could challenge limits placed on their production.

Beyond scaling up production there are other challenges around collection and distribution of raw biomass materials. So biorefinery location could be key to keeping costs low. This of course should bode well for rural communities where most biomass waste is produced!

But the biggest challenge to cellulosic biofuels will likely be cost and price competition. If oil prices drop as the world slips into an economic slowdown, short-sighted investors might see new opportunities in companies who were previously harmed by high energy costs. So funding expensive research and commercialization efforts could be the key to the future of next generation biofuels.

Image credit: Swanksalot Flickr CC License

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