President Obama's nomination of an alternative-fuels insider to a Department of Energy (DOE) post is the latest news that points to imminent large-scale production of ethanol made from non-edible plant sources (cellulose) in the United States.
On March 23 Obama announced his nomination of Steven Koonin, chief scientist at BP, to the Undersecretary of Science position, which reports to DOE Secretary Steven Chu. Koonin, a physicist, has focused heavily on alternative energy research since joining BP in 2004, and he and Chu previously collaborated on biofuels research through a BP partnership with academia.
The president and others see development of a cellulosic ethanol industry as crucial to meet the federal Renewable Fuels Standard (RFS) mandate for the transportation fuel industry to produce 36 billion gallons of renewable fuel by 2012. Producers will make 11 billion of renewable fuels this year, according to the Renewable Fuels Association (RFA).
Since the relatively recent realization that production of traditional ethanol is too problematic to fulfill RFS mandates, at least a dozen new companies and partnerships have formed around an industry that has not yet coalesced but could replace as much as 30% of gasoline in the U.S. transportation fuels market by 2030, according to a recent report released by Sandia National Laboratories and General Motors.
“Cellulosic biofuels could compete without incentives with oil priced at $90 per barrel, assuming a reduction in total costs as advanced biofuels technologies mature,” according to a summary of the report, which was released in February 2009.
Researchers view cellulosic ethanol as more economically and environmentally sustainable than other alternative fuels because it is not tied to price-sensitive food crops such as corn and soybeans, and it requires less energy and farmland to produce its core feedstocks.
A slew of small start-ups focusing on one of many and myriad aspects of the nascent industry have formed, as have several partnerships involving well-known, global companies. Among the large, established companies investing in such ventures are BP, Shell, U.S. Sugar, ADM, and Dupont.
“There are a multitude of folks chasing this cellulosic ethanol grail,” said Joe Skurla, CEO of Dupont Danisco Cellulosic Ethanol (DDCE), a joint venture of Dupont; and Danish enzyme and biotech company Danisco. “Those that are aligned with large companies and have their own funding are more likely to succeed.”
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