No Surprises

Expert committee finds industry unlikely to meet 2022 cellulosic goal
By Kris Bevill | November 15, 2011

The response from the biofuels industry regarding the content of a report released in October by the National Academy of Sciences on the potential economic and environmental effects of the U.S. renewable fuel standard (RFS2) was loud and clear: this is a report that should be digested with a large grain of salt and should in no way influence future policy.

“You can read this report in a number of ways because the conclusions are based on variables that will undoubtedly change with technological advancements and innovation within the industry,” says Growth Energy CEO Tom Buis. The study “largely assesses ethanol and other biofuels in a vacuum and fails to appropriately compare the costs and benefits of renewable fuels to the impacts of the marginal petroleum sources they are displacing,” the Renewable Fuels Association adds.

The report, “Renewable Fuel Standard: Potential Economic and Environmental Effects of U.S. Biofuel Policy,” is an independent assessment by 16 researchers of the economic and environmental benefits associated with achieving the goals set by the RFS2. Committee co-chair Wally Tyner, energy economist, professor of agricultural economics at Purdue University, and co-director of the university’s Center for Research on Energy Systems and Policy, says he’s not surprised by the ethanol industry’s reaction to the report. “They have a responsibility to protect their turf, if you like, and the people who do studies like this have a responsibility to tell it like we see it,” he says. “I don’t see a problem with that.”

It’s doubtful the industry can seriously dispute the finding that the industry is unlikely to meet the 2022 RFS2 mandate for cellulosic biofuel, although Tyner says that finding appears to be the most controversial. “The reality is that with zero gallons today, we’re not likely to get to 16 billion gallons of cellulosic by 2022,” he says. “If you look back, it was the Energy Tax Policy Act of 1978 that provided the original impetus and since that time we’ve grown from 0 billion gallons to 14 billion gallons [of corn ethanol production], from zero plants to over 200 plants, and that’s with a technology we knew and a relatively inexpensive feedstock. With cellulosics, we have a technology that we don’t know well, we have expensive feedstocks and no plants built, and we’re expected to go from 0 gallons to 16 billion gallons in 11 years when it took us 30 years to go from zero to 14 billion gallons for corn. That’s just not likely to happen.”

Considering that the overwhelming majority of potential cellulosic ethanol producers agree that they are not likely to meet the 2022 RFS goal, it is reasonable to assume then that the underlying reason for the industry groups’ dissatisfaction is a concern that the report will be used to support the movement to dismantle the RFS. Tyner says that while the report was prepared for policymakers, it offers no policy suggestions and should “absolutely not” be used to support changes to the mandates. “This report makes no policy recommendations,” he says. “It’s just findings. It doesn’t say anything about either changing the RFS or keeping it the same. All it says is we’re not likely to meet it. And that’s just for cellulosics. We’re not saying you’re not ever going to meet that [16 billion gallon] level; we’re saying you’re not going to meet it by 2022.”

Another finding included in the 446-page report that drew significant attention was the conclusion that the RFS2 may be ineffective in reducing global greenhouse gas emissions. In order to reach this tentative conclusion, however, the committee separated biofuels into three feedstock categories, two of which do significantly reduce emissions. Corn ethanol is widely agreed to neither increase nor decrease emissions significantly, Tyner says. But when residues such as corn stover and forest trimmings are used to produce biofuels, the result is a major reduction. The impact from the use of dedicated crops, the third category, will remain unclear until more crops are grown to serve as an example.

Ethanol industry representatives also questioned why the report did not include a comparison with petroleum. The answer is simple: they weren’t asked to. The U.S. EPA and the California Air Resources Board are beginning to conduct those comparisons, however, and Tyner assumes that biofuels will come out on top. He points out that the committee was also not asked to evaluate the national security implications associated with domestic fuel production. 

—Kris Bevill