Biofuels and Sustainability
Why biofuels?
Biofuels provide the Northwest with energy security, economic development, and environmental benefits. They are an important solution today to reducing our dependence on foreign petroleum, especially when combined with conservation, energy efficiency, and improved vehicle mileage. The U.S. spent $327 billion on imported oil in 2007 and, with current oil prices, will likely spend more than $440 billion in 2008. (US EIA) Biofuels provide the U.S. a home-grown, renewable alternative to imported fossil fuels, reducing greenhouse gas emissions, and creating new jobs and local tax revenue in rural communities that need it most. Using first generation biofuels – mainly soy biodiesel and corn ethanol – will help build the infrastructure and create the bridge to even more efficient, second generation of biofuels such as algae-based biodiesel and cellulosic ethanol.
Do biofuels help our energy security?
Yes. Over 60% of our petroleum is imported and transportation is 98% dependent on petroleum. Biofuels are a critical part of the solution to lower our dependence on foreign petroleum. Increased conservation, fuel efficiency, and new technologies are also part of the solution. In 2007, the production and use of ethanol reduced oil imports by 228.2 million barrels, saving $16.5 billion from being sent to foreign countries, while domestic biodiesel off-set another 11 million barrels of imported fuel.
Fossil fuels are a finite and non-renewable source of liquid fuel. To meet even the low range of predicted global energy demand in the year 2030 will require adding the equivalent petroleum supply of a new Russia and a new Saudia Arabia.
Biofuels diversify our fuel supply. Petroleum consumption trends show that global demand continues to rise as production remains relatively flat, depleting reserves. Biofuels can help minimize the depletion of these reserves and extend our existing fuel supplies.
Our current petroleum distribution system is centralized, we have a limited number of refineries in the U.S. producing gas and diesel and shipping from those locations. This centralized distribution system is highly vulnerable to attacks – whether from terrorists or by a natural disaster (such as Hurricane Katrina) or from an electricity outage. Biofuels have an efficient, locally connected distributed system of hundreds of biorefineries across the country which helps reduce our risk and vulnerability. Biofuels can also be used for electricity and add to the diversity of our energy portfolio.
Do biofuels provide economic development?
Yes. When consumers buy domestic biofuels, the majority of the money re-circulates in the U.S., the opposite of which is true with imported petroleum. According to the US EIA, $327 billion in 2007 was spent on imported petroleum.
Biofuels bring economic development and additional job opportunities to the Northwest, especially to rural communities. For example, more than $500 million has been invested in biodiesel and ethanol production regionally during the past two years, leading to family-wage jobs and needed tax revenues in communities such as Gray’s Harbor, Washington; Clatskanie , Oregon; Chester, Montana; and Burley, Idaho. In Oregon alone, 50 full-time biodiesel-related positions have been created and approximately $46 million was generated in economic activity. As more biofuels are grown and produced in the Northwest, more of the biofuel-generated funds will stay in the regional economy.
Nationally, a 2006 analysis funded by the National Biodiesel Board estimated that expansion of the biodiesel industry will displace 242 million barrels of crude oil between 2006 and 2015 and as a consequence, $13.6 billion will remain in the American economy instead of being spent abroad to finance oil imports. The ethanol industry alone accounts for 238,000 jobs, $47.6 billion in GDP and saves consumers $12.3 billion, according to the most recent studies. The NBB study cited above also estimated that the combination of new construction and ongoing biodiesel production will support the creation of more than 39,100 new jobs in all sectors of the economy and that the biodiesel industry will put an additional $627 million into the pockets of American households each year for a total impact of $6.3 billion between 2006 and 2015.
Additionally, according to Merrill Lynch commodity strategist Francisco Blanch, recent record crude oil prices would have been approximately 15% higher if the biofuels industry wasn't tempering some of the oil and gasoline demand with increased biofuel production.
Are biofuels better to the environment than petroleum?
Yes. Every gallon of biofuel produced today requires less land, requires less water and is less energy intensive than a decade ago, while the opposite is true for oil production. Every new gallon of oil produced is more energy intensive and requires more water than before. The “easy” sources of oil have been found and are being rapidly depleted. What is left are more remote, costlier and more environmentally damaging nontraditional sources such as Canadian tar sands or Rocky Mountain oil shale.
The latest UC Berkeley data shows that corn ethanol can reduce greenhouse gas emissions up to 40% compared to conventional gasoline, and cellulosic ethanol can reduce emissions 80% or more. Conversely, new, nontraditional oil sources (like Canadian tar sands) emit 300% more greenhouse gas emissions than traditional sources.
Current technologies in agriculture and biofuel processing have dramatically increased efficiency, lowered inputs, and help to conserve our soil and water resources (such as direct seed, no or low till practices). Biofuels have lower greenhouse gas emissions than fossil fuels and they improve our air quality through lower tailpipe emissions. E10 has 30% less carbon monoxide than regular gasoline and 25% less particulate matter. B99 has a 48% reduction in carbon monoxide, 99% in sulfates, and 47% less particulate matter. Ethanol has replaced MTBE as an oxygenate for gasoline due to the health impacts of MTBE contaminating groundwater. Gasoline contains more than 150 chemicals including numerous toxics and carcinogens. Ethanol and biodiesel are non-toxic and biodegradable.
Unlike other parts of the U.S, the Northwest can rely on multiple feedstocks (crops, animal products) to create biofuels including many byproducts. As technology improves, the Northwest is well situated to provide advanced biofuels such as cellulosic ethanol and biodiesel from algae, both of which have the potential to further increase biofuels’ environmental benefits and provide further greenhouse gas reductions.
Can we grow biofuel feedstocks in the Northwest?
Yes. The Northwest provides multiple feedstocks for biofuels. Biodiesel can be made from oilseed plants such as canola, mustard, and camelina which can provide advantages when integrated into rotations with other Northwest crops. These plants (and plant residues) help capture and retain soil moisture reducing topsoil runoff through tillage conservation practices that minimize soil disturbance. Camelina requires reduced nitrogen inputs to achieve desired yield results. Nitrogen recapture from deep-rooted brassica like canola and mustard reduce leached nitrogen. These crops, especially camelina, are an attractive option where limite d rainfall r educes cropping choices.
Canola meal (a byproduct from when the canola is crushed into oil) is highly sought after in the dairy industry for its ability to increase milk production when included in dairy rations. Currently a significant amount of canola meal is imported from Canada into the Northwest for consumption in the dairy industry. In addition to crops, the Northwest has used cooking oil, tallow, and industrial vegetable oil (for example from french fry producers and potato chip manufacturers) that are being converted into biodiesel.
The Northwest also has tremendous potential for growing ethanol crops. Culled potatoes are used as an ethanol feedstock in Idaho. Distressed wheat grain (low protein, high starch) can be converted to ethanol in Montana. A technology that is currently being developed with an eye to Northwest feedstocks is cellulosic ethanol, which can be made from municipal wood wastes, forest thinnings, and crop residues such as wheat straw. The utilization of wheat straw for cellulosic ethanol is very promising in our higher rainfall areas where increased yields of grain and biomass lead to challenges of residue management of our conservation tillage practices. Cellulosic crops such as switchgrass and hybrid poplars are also very promising in this region.
Do biofuels consume more energy than they produce?
No. The production of ethanol has a 34% energy gain, while the production of gasoline has a 19.5% energy loss, according to a 2004 USDA study. In June 2004, the U.S. Department of Agriculture updated its 2002 analysis of ethanol production and determined that the net energy balance of ethanol production is 1.67 to 1. For every 100 BTUs of energy used to make ethanol, 167 BTUs of ethanol is produced. The USDA findings have been confirmed by additional studies conducted by the University of Nebraska and Argonne National Laboratory. These figures take into account the energy required to plant, grow and harvest the corn—as well as the energy required to manufacture and distribute the ethanol. The energy gains for cellulosic ethanol are estimated to be approximately 80%, if not more.
Ethanol opponents frequently cite studies by Cornell University’s Dr. David Pimentel and Tad W. Padzek, who concluded that ethanol returns only about 70% of the energy used in its production (a net energy balance of -29%). Pimentel’s findings have been consistently refuted by USDA and other scientists who say his methodology uses obsolete data and is
fundamentally unsound. In a detailed analysis of Pimentel’s research, Dr. Michael S. Graboski of Colorado School of Mines says Pimentel’s findings are based on out-of-date statistics (22 year-old data) and are contradicted by USDA. Pimentel’s reports have also been debunked by Michael Wang and Dan Santini of the Center for Transportation Research, Argonne National Laboratory, who conducted a series of detailed analyses on energy and emission impacts of corn ethanol from 1997 through 1999.3 A recent study by UC scientists, published in the January, 2006 edition of Science magazine, also acknowledges a positive net energy balance for ethanol, placing the energy return at between 4 and 9 MJ/L.
Furthermore, even the most pessimistic assessments of ethanol’s energy balance acknowledge that ethanol is an improvement over petroleum-based fuels. Using the same analytical methods employed by some ethanol critics, Michigan State University’s Bruce Dale calculates the net energy of petroleum to be -45%, compared to the -29% that Pimentel and Patzek find for ethanol. In the worst-case scenario, burning ethanol is still more energy-efficient than burning gasoline.
Studies by the U.S. Department of Energy show that for every unit of fossil fuel used to produce biodiesel (from soybean oil), 3.2 units of renewable energy are gained. A recent USDA study has upgraded that number to 3.5 units of renewable energy being gained. Petroleum diesel returns only .88 units of fossil fuel energy for every one unit used in its production. When biodiesel is made from used cooking oil and is consumed locally, the energy balance increases to approximately 7.4 units gained. In other words, more energy is produced from biodiesel than is consumed by it, while petroleum diesel consumes more energy than it produces.
What is the relationship between biofuels and food prices?
Price increases for food have less to do with ethanol or biodiesel production, than they do with the five fold increase in petroleum price over the past five years. Several studies have shown that record petroleum prices, which permeate the entire food system for all types of food, have added three times the food price impact as biofuels. The increasing standard of living in China and India, droughts in Australia and Europe, regional natural disasters/pests/diseases, increases in labor and fuel costs globally, a declining dollar driving exports, increase in food commodity speculation , and corporate profits at retail have all contributed to higher food costs.
U.S. corn ethanol is made from field corn, not corn consumed directly by humans. The prices farmers receive for corn has a very marginal effect on retail food prices. There is less than a nickel’s worth of corn in a box of cornflakes, and less than 2 cents worth of corn syrup in a can of soda. Eighty percent (80%) of the average retail price of food is added after it leaves the farm, with about half of that in labor costs. The foods with the highest price increases in 2007 were fruits and vegetables which have little to do with biofuels.
How do biofuels impact land use and what does this mean for “food versus fuel”?
Biofuels have been criticized as a “carbon debt” under the assumption that for every acre of land dedicated to biofuel crops, another acre of land must be put into food production elsewhere in the world. Recent reports assert that increasing production of biofuels in the U.S. is driving destruction of ecosystems in South America and Asia for food production and attributes a carbon debt to biofuels from the clearcutting of rainforests and cultivation of native ecosystems.
This assertion is based on assumptions and models that are not and cannot be verified. This “secondary land use impacts” assumption counters all current, verified analyses showing substantial greenhouse gas emission reductions for biofuels. The assertion is flawed for several reasons. The major flaw is that it asserts that the land use changes in South America and Asia are due to an increase in commodity prices and inappropriately assigns all of the impact on commodity price increases to the growth in biofuels in the U.S., ignoring the effects of a growing world economy, increased demand for food, urban sprawl, and the increase in fuel costs used for transporting commodities. It fails to account for advances in seed and processing technology that are providing greater yields for each acre of biofuel feedstock. It also ignores the value of the feed co-products that are produced at today’s biorefineries such as distillers grain (from corn ethanol plants) and canola and soy meal (co-products of biodiesel), all of which are high protein sources used to feed livestock. By weight, 80% of soy, 25% of corn, and up to 60% of canola meal all return to the human or livestock food chain after the fuel is produced.
By the logic used in these reports, any non-food crop is to blame for the destruction of ecosystems. A large percentage of land in the U.S. is planted in seed crops, nursery products, hay, pasture, and farm forest products. For example, 45% of agriculture production in Oregon is non-food such as Christmas trees, grass seed, and nursery trees. If one is to argue that a crop used for a biofuel displaces food, then one has to also accept that a crop grown for anything other than food is displacing food. Also, every new subdivision or greenfield commercial, industrial, or residential development would be responsible for creating a “carbon debt” by taking potential food-producing land out of production. Currently the U.S. loses two acres of agriculture land to urbanization every minute of every day.
Productivity increases in U.S. agriculture have enabled farmers to produce 500% more today than 60 years ago while using less land. Technology and efficiencies will continue to enable these advances. Biofuel crops grown in the U.S. are not displacing forests, wetlands, or other native plants. These are lands that have been farmed for decades and will continue to be. The mix of crops grown on them changes in response to market price signals. It is also important to remember that certain crops grow in certain areas because of soils, rainfall, and climate. Land use in other nations is complex, but the linkage to biofuels production is marginal. The increase in soybean acreage in Brazil is due to China and India’s growing populations rather than biofuels.
Corn acreage in the U.S. peaked in 1917 with 116 million acres planted, compared to 93 million acres in 2007. During that period yields have increased by more than 1 bushel/acre/year, from 29 bushels/acre to 200 bushels/acre. During a time of increased corn ethanol production, the U.S. is harvesting more than 10 billion bushels of corn, and exports are rising. In 2007, farmers planted more additional acreage in corn than all corn used in ethanol production. U.S. corn ethanol production is not causing a need for increased grain production in the world. Even with the increase in biofuel production and corn and soy exports, the U.S. still has substantial ending stocks. Estimates for 2008 corn ending stocks are 997 million bushels, with 160 million bushels of soy and 2.8 billion pounds of soy oil.
How do biofuels impact mileage?
The recent 2 Million Mile Haul (studying biodiesel) has data that shows that the difference in mileage between B20 and Ultra Low Sulfur Diesel is not statistically significant given the driver variability (EPA has identified the single largest factor in fuel economy is driver operation, and that proper operation can reduce fuel use and increase fuel economy by 26%). Per a National Renewable Energy Laboratory study, B20 biodiesel in buses resulted in approximately a 1.2% reduction.
Use of an E10 ethanol blend in spark-ignited automobile engines has not affected, and may have improved, fuel economy in recent EPA field studies. This is partly because modern automobile engines benefit more from the increased octane content in E10 than the slight energy content reduction. Recently, Volvo has released an E85 Flex Fuel vehicle that produces about the same fuel economy with E85 as it does with standard unleaded gasoline. This is because the engine has been optimized to run on both gasoline and E85, unlike most American vehicles optimized only for gasoline.
Another recent study (2007 ACE and State of Minnesota) illustrates that non-Flex Fuel vehicles may get better fuel economy with increased amounts of ethanol (E20 to E55) as they do in other countries (like Brazil). Tests run on current vehicles show that certain models run optimally on higher blends of ethanol such as the Toyota Camry on E30 and certain GM models on E20. Lower fuel economy may still occur in older, carbureted vehicles, especially those operating at higher elevations. Modern engine controls compensate for these fuel variations and result in little or no difference in mileage. E10 does not affect fuel economy in most newer vehicles. Even in older vehicles, the mileage is usually only reduced by about 1-3%.
Where can I learn more?
Council for Sustainable Biomass Production
Sustainable Biodiesel Alliance
Roundtable on Sustainable Biofuels
National Biodiesel Board's Sustainability Taskforce
Citation for NBB Study – Contribution of the Biodiesel Industry to the Economy of the United States. Prepared for the National Biodiesel Board with funding support from the United Soybean Board. John M. Urbanchuk, Director LECG, LLC. June 19, 2006.