Trust only movement. Life happens at the level of events, not of words. Trust movement.
—Alfred Adler
Almost a year has passed since President George W. Bush told us that we have a serious problem: Americans are addicted to oil. This astonishing revelation galvanized politicians on both sides of the aisle. It is now de rigeur to decry America’s precarious dependence on foreign oil. Scrambling to find solutions, Congress passed the Energy Independence and Security Act, which the President signed into law on December 19th, 2007.
A key provision of H.R. 6 mandates that the United States expand biofuels production to 36 billion gallons annually from the current level near 6.3 billion gallons. 21 billion gallons are slated to come from biomass-to-liquids (BTL) processes using cellulosic feedstocks. Funding for key provisions (e.g. section 230) makes it clear that Congress expects cellulosic ethanol to fulfill the renewable fuels requirement. Is this target realistic? If it is, does it matter? Catering to an uninformed public, our politicians have laid out a road map for failure. Cellulosic ethanol is not a silver bullet that solves America’s oil dependency.
HR 6 — Let’s Do the Math
To provide a context for evaluating the prescribed contribution of cellulosic ethanol, let’s do the math in order to see how much oil savings there will be by 2022 if all the provisions were successfully implemented. The bill calls for a increase in average fleet fuel efficiency to 35 miles per gallon by 2020. According to the Union of Concerned Scientists, “the measure would save roughly 1.1 million barrels of oil per day in 2020, about half of what the United States currently imports from the Persian Gulf.” The savings is 5.3% of U.S. oil consumption in 2006 (20.687 million barrels per day).
In 2006, the U.S. consumed 141.839 billion gallons of gasoline according to the Department of Energy. Doing the energy conversions, 1 gallon of gasoline contains 115,000 British Thermal Units (BTU) of heat energy. 1 gallon of ethanol contains 75,700 BTUs per gallon, 66% of the energy in the gasoline. The prescribed 36 billion gallons of ethanol will thus replace only 23.76 billion gallons of gasoline altogether. The ethanol from cellulose (or other non-cornstarch feedstocks) replaces 13.86 billion gallons of gasoline.
Based on a standard 42 gallons of gasoline for every barrel of light sweet oil, the 36 billion gallons of ethanol will replace 1.55 million barrels of crude everyday in 2022. This works out to 7.5% of America’s daily oil consumption in 2006. Of this total, ethanol from cellulose alone would shave about 900,000 barrels per day off that demand. The 4.4% oil savings that Americans would realize in 14 years is paltry. The hyperbole—see the Coskata, Inc. website—and the reality—should all this work out—are out of sync, to say the least. Caveat emptor.
The Corn Ethanol Bubble
Corn ethanol production in the United States is nearing its limit. It woud be surprising if output ever surpasses 11 to 12 billion gallons annually, although H.R. 6 caps production at 15 billion gallons per year in 2011. About 6.3 billion gallons were produced in 2007, but capacity stood at 7.229 billion gallons with more on the way. (These numbers are from the Renewable Fuels Association, an industry trade group.) The market, which is underpinned by compulsory use of ethanol as a fuel additive, is now close to saturation. Additional corn ethanol consumption will depend on the availability of cars that can use higher ethanol blends like E85 and the expensive infrastructure required to deliver that fuel to consumers at the pump.
Corn was over $4.50/bushel at year’s end (graph above left). The March, 2008 futures contract now stands at about $5.00/bushel at the Chicago Board of Trade. Corn prices are driving inflationary pressures on dairy products, beef production, and the many other foods that contain corn as an ingredient. The direct conflict between food and fuel pits many vested interests against each other. American voters will eventually veto future production increases when their supermarket bills tell them they’re being squeezed to accommodate the interests of big agriculture. The generous $0.51/gallon subsidy helps ethanol producers less and less as their corn feedstock costs soar. See the New York Times‘ A New, Global Oil Quandary: Costly Fuel Means Costly Calories to learn about the big picture in food versus fuel issues.
It is hard to find a scientific study that has anything good to say about corn ethanol. An OECD study Biofuels: Is the Cure Worse Than the Disease? provides a rigorous treatment of all the problems attending “1st generation” biofuels production from corn, palm oil, or soy beans. The conflict between food and fuel will ultimately kill off production of fuels from these feedstocks. Corn ethanol is not quite dead, but the production peak is surely in sight.
Practical and Scientific Challenges for Cellulose
People advocating our cellulosic ethanol future probably do not fully comprehend the massive land use changes they are proposing. Biomass-to-liquids processes use non-food feedstocks such as switchgrass (Panicum virgatum, pictured left) which do not require arable land. This advantage must be weighed against the challenges of raising wild grasses as an energy crop (and similarly for other feedstocks such as wood chips). This is agriculture of a very different sort than that used for corn, and growing and the annual harvesting of switchgrass does not come for free.
The Oak Ridge National Laboratory’s Biofuels from Switchgrass: Greener Energy Pastures tells us that “switchgrass can be cut and baled with conventional mowers and balers,” but it’s not that simple. Writing in MIT’s February, 2008 Technology Review, Gregory Stephanopoulos describes the three major challenges for the “economical conversion of biomass to biofuels.” Using switchgrass (as in our example) as an energy crop requires a new kind of agriculture.
The first [challenge] is to optimize the yield and quality of the biomass [switchgrass], as well as to work out the logistics of securing, transporting, and processing the large volumes that will be required to support the operation of future biorefineries. New ways of harvesting, preprocessing, and transporting biomass will be necessary before it’s cost-effective for biorefineries to import biomass from more than 15 or 20 miles away. One scheme is to establish satellite collection and pretreatment facilities from which slurry biomass is transported by pipelines to the main biorefinery. One can envision pipelines where cellulose hydrolysis, the slow process by which cellulose is broken down into usable sugars, takes place while a slurry is transported from the satellites to the main biorefinery.
None of these problems are insurmountable, but it will take many years to work out the kinks in energy crop agriculture.
Stephanopoulo’s second and third challenges present scientific obstacles that need to be overcome. The diagram (left, from the OECD study op. cit.) shows the production pathways for making biofuels. There is an extra “pre-treatment” step for cellulose conversion. This second challenge requires that scientists find ways “to improve the way biomass is broken down, so as to yield a stream of abundant, inexpensive sugars for fermentation.” David Rotman’s The Price of Biofuels (Part II, Technology Review, same issue) quotes Caltech researcher Francis Arnold, who explains the problem in simple terms.
“Cellulose has physical and chemical properties that make it difficult to access and difficult to break down,” explains Caltech’s Arnold, who has worked on and off on the biological approach to producing cellulosic ethanol since the 1970s. For one thing, cellulose fibers are held together by a substance called lignin, which is “a bit like asphalt,” Arnold says. Once the lignin is removed, the cellulose can be broken down by enzymes, but they are expensive, and existing enzymes are not ideal for the task.
Arnold and other researchers have been working on this problem1 since the 1970’s, the last time oil prices were in their current range, but an off-the-shelf commercially viable solution to pre-treating cellulose does not yet exist.
Stephanopolous defines the third challenge—
The last step is to construct new pathways that convert sugars into the various target biofuels in organisms such as yeast and E. coli [the fermentation step]. Here lies the third challenge: to engineer optimal pathways. There is an important difference between stitching reactions together by importing genes from other species and constructing an optimal pathway that converts all sugars at maximum yields and efficiencies, producing biofuels at high concentrations. Making biofuels cost-competitive will require the latter, but to achieve that goal we must engineer strains of yeast, E. coli, or other organisms with high tolerance for the toxicity of both the initial biomass hydrolysate and the final biofuel product. [emphasis added]
Rotman tells us that the dream of some researchers is to consolidate the pre-treatment and fermentation steps into a single process facilitated by genetically engineered or yet-to-be-discovered superbugs, which are “microörganisms that can break down cellulose to sugars and then ferment those sugars into ethanol.” In the quest for more efficient pre-treatment, Arnold has discovered about one thousand enzymes that break down wood in microbes found in termite guts. Maybe one of those microbes will be genetically altered to assume superbug status in the future. Maybe.
No commercially viable cellulosic ethanol biorefineries exist because the pre-treatment stage is too expensive. From the OECD study—
Demonstration plants have already been built to produce ethanol from ligno-cellulosic materials, but production costs are high, generally around $1.00 per litre [$3.78 per gallon] on a gasoline-equivalent basis. Hundreds of millions of dollars have already been spent by both governments and private industry on research to bring down those costs. Most of these efforts are focussing on the front end of the process, the breaking down (through enzymes or microbes) of lignin, cellulose or hemi-cellulose (the building blocks of ligno-cellulosic biomass) into a form that can then be fermented, and increasing the ethanol content in the fermented broth, so as to reduce the energy needed in the distillation stage.
Author’s Note: All ethanol production, from corn or cellulose, require a costly distillation step because alcohol and water mix, which degrades the fuel. This is why ethanol can not be transported in pipelines.
The Canadian company Iogen Corporation has built one of the few cellulosic ethanol demonstration plants. Company spokesmen claim that “with a few kinks to work out, the ethanol could be produced at about $1.08 (U.S.) a gallon.” The feedstock is wheat, oat, and barley straw and the special sauce used to break down the cellulose contains a fungus called “jungle rot” (Trichoderma reesei). Grist reports that Iogen wanted the Canadian government provide funding in order to share their risks in going commercial as of December, 2006.
Grist also reports that “a June 2006 U.S. Senate hearing was told that the current cost of producing cellulosic ethanol is $2.25 per gallon, which is not competitive when distribution costs are added.” It’s not clear where this per-gallon cost number comes from, but it is also cited by José Goldemberg’s Ethanol for a Sustainable Energy Future (reprinted from Science 9 February 2007: Vol. 315. no. 5813, pp. 808 – 810).
The science tells us that cellulosic ethanol is not ready for prime time although researchers have been working on the problem since the 1970’s. Even if the rising oil price makes this form of biofuel cost competitive, it will take at least a decade to overcome the technological and practical obstacles that prevent production from scaling up to levels now seen for corn.
Market Evolution and The Role of Biofuels
When Congress passed the Energy Independence and Security Act, they created a skewed biofuels playing field that puts entrepreneurs pursuing other research avenues at a disadvantage. Business Week’s Deconstructing the Energy Bill describes the frustration of David Berry, a principal at Flagship Ventures, a venture capital firm backing LS9, a start-up trying to make “renewable petroleum.” Berry complains about the “preferential treatment” the lawmakers gave to ethanol—only $25 million was allocated for other emerging technologies such as those being developed by LS9. Elsewhere, University of Wisconsin professor James Dumesic and a team of researchers are working on more efficient ways to make DMF (2,5-dimethylfuran), a synthetic alternative fuel made from sugars that contains the energy density of petroleum. Another process, H2CAR, “demonstrated that a hybrid system of hydrogen and carbon can produce a sufficient amount of liquid hydrocarbon fuels to power the entire U.S. transportation sector.”
Dubious claims like those made for the H2CAR technology should be tested in the evolving market for biofuels (graph left). This early-stage market is in the “Emergence” phase where a number of research projects and start-up companies should compete to create viable substitutes for oil on a level playing field. It is a risky to bet to assume, as Congress did, that a breakthrough technology will emerge that allows large-scale commercial ethanol production while ignoring other potentially fruitful technologies.
“Silver BBs” is a stock phrase in the peak oil research community. The metaphor refers to the fact that there is no single silver bullet that will kill the wolf at the door—the plateau and eventual decline of the world’s oil supply. Biomass-to-liquids conversions will provide one kind of substitute for oil. Although ethanol or the other possibilities mentioned above will likely be niche markets in the future, the availability of substitutes, even when these work only on small scales, should never be discounted. The real problem—one could say “fantasy”—comes when proponents envision that BTL processes will scale up sufficiently to completely replace our need for liquids from fossil fuels. This dangerous and erroneous belief obstructs tangible progress in weaning ourselves off of oil.
We have seen that the Energy Independence and Security Act does not provide a cure for our oil addiction, a situation exacerbated by the concern that corn or cellulosic ethanol, the favored fuel of our politicians, will replace only a very small fraction of American oil consumption by 2022 in the best case. In the meantime, the peak of Gulf of Mexico oil production will have come and gone, U.S. production will have fallen considerably from current levels, Mexico will no longer be exporting any oil, and the OECD nations will be utterly dependent on exports from the unstable Persian Gulf. This is only a partial list of the oil production and export shortfalls Americans can expect to see. These historical circumstances describe a disaster waiting to happen. An authentic understanding of the actual role of cellulosic ethanol and other biofuels as substitutes for oil goes some of the way toward creating the foundation for an appropriate response to our peak oil predicament.
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1. In another example, Purdue scientist Nancy Ho has been working on the “development of safe effective Saccharomyces yeasts to convert sugars from cellulosic biomass into ethanol” since the mid-1980’s. Ho’s yeast is genetically engineered and is quite effective in the laboratory. Even so, Iogen, which licenses the technology, does not use it in their cellulosic ethanol demonstration plant.
