By Jim Schutze
By Rachel Watts
By Lauren Drewes Daniels
By Anna Merlan
By Lee Escobedo
"Once you crack that code, then you can talk about an industry not producing 5 billion gallons a year but producing 50 billion gallons a year," says Matt Hartwig of the Renewable Fuels Association, an organization that promotes both corn and cellulosic ethanol. "It really blows the lid off the industry."
Hence the current Bush administration is throwing money—some $150 million tucked in the 2007 budget—at the technology to help fund the bio-refineries that will produce the fuel. The Energy Policy Act of 2005 mandates that 250 million gallons of cellulosic ethanol be added to the nation's fuel supplies by 2013 and provides for loan guarantees for cellulosic refineries.
But the challenges are daunting. The process requires massive research investment to discover and produce efficient enzymes that can break plant cellulose into sugar and organisms that will convert those sugars into ethanol. The enzymes are expensive, and the process is risky. Progress depends on oil prices hovering above $50 per barrel. "Cellulosic ethanol has never been manufactured on an industrial scale, and the technology to produce this type of ethanol is still being developed and is far from mature," says a National Resources Defense Council report titled "Ethanol: Energy Well Spent."
Yet other challenges may loom for the cellulosic golden goose. "The joker in that deck is when switchgrass and wood chips can be turned into cellulose ethanol, what happens to these guys who invested in the corn ethanol plants?" asks Dennis Avery at the Center for Global Food Issues at the Hudson Institute, a Washington, D.C., think tank. "The cellulose plants are going to be in different places. There will be an intense lobbying war, and the best fuel won't win. The best lobbying program will."
But the Renewable Fuels Association's Hartwig flatly dismisses warnings of erupting lobbying skirmishes over subsidies and tax preferences. "It won't replace corn," he says. "Many of the corn farmers today will still be involved in the cellulosic side because they'll use some of the leftover corn stalks."
Yet even the defense council's Greene concedes that renewable fuels won't come close to replacing projected transportation fuel demand. The reason: land. At current cellulosic crop yields, it would take 1.75 billion acres to meet projected 2050 light-duty gasoline demand. Total landmass in the contiguous 48 states is about 1.9 billion acres. Another looming question: What happens if the food value of a crop drops below its fuel value? "The world's demand for food and feed is going to double again," warns the Hudson Institute's Avery.
Malaysia, the leading producer and exporter of palm oil, a potent fuel crop, is rapidly expanding its biodiesel production with some 52 refineries in the works and plans to be the top global biodiesel producer. This has some environmentalists worried this will usher in a new round of rain forest destruction as the lush, humid lands in Southeast Asia are cleared for palm cultivation to feed these new refineries.
"There is a tendency among biofuels boosters to make it sound like we can do everything with biofuels, and critics tend to say you can't do everything with corn," Greene says. "There's a limit, even with advanced technologies that we are really excited about."
That's why Greene's strategy for slashing projected year 2050 transportation fuel consumption by two-thirds—from 30 million barrels of oil per day down to 10 million—doesn't rely primarily on biofuels. In a report titled "Growing Energy, How Biofuels Help End America's Oil Independence," Greene argues that most U.S. transportation fuel consumption must be reduced through dramatic engine and vehicle efficiency gains coupled with what he calls smart growth, or planned communities that curtail sprawl by offering walkable neighborhoods near jobs, services and public transportation to cut drive time. But while such communities may seem practical, even desirable, in theory, it's difficult to see how they could be workable, especially in metropolitan areas like Los Angeles, San Francisco, Chicago and New York, where extremely high housing and living costs shove low- to moderate-income workers to the outer suburbs. Walkable communities near public transit hubs are highly desirable—witness Mockingbird Station—and developers and merchants charge accordingly.
Even more illusory is the realization of significant energy consumption reductions via increased efficiency, if history is any guide. According to the Department of Energy, annual per capita energy consumption was actually slightly higher in 2005 than it was in 1970: 337 million Btu (British thermal units) versus 334 million Btu. The data show energy consumption levels have remained relatively constant over the past 35 years—this despite enormous efficiency gains in everything from power generation to vehicle engines to home appliances and electronics.
The reason? Consumers apparently leverage efficiency gains not toward energy savings, but toward higher standards of living. More efficient engines translate into heavier vehicles traveling more miles with more power and safety and convenience features. More efficient aircraft and jet engine designs mean more people fly more often to more places at greater distances while demanding fresh sushi in Chicago. More efficient AC power supplies batteries, and computer processors mean iPods, cell phones, digital cameras, massive televisions and computers proliferate in millions of homes—many plugged into the Internet, itself a vast network of computer server farms that, individually, gobble enough energy to feed a small city. In short, if we want to avert an alleged global warming cataclysm, we'll not only have to cut back on driving, we'll have to cut back on American Idol and blogging too.