FEB
11

Growing pains for growing fuel

 
  Today's Energy Daily reports on a "study by Sandia National Laboratories and General Motors R&D Center" finding that the U.S. could "produce 90 billion gallons of ethanol—including 15 billion gallons of corn-based ethanol—by 2030." This production would "displace nearly a third of the nation’s projected transportation fuel use in 2030." That's the good news, but there are caveats. First, as the article points out, the study found that cellulosic ethanol "could compete with oil priced between $70 and $90 per barrel in 2030" without additional federal subsidies, but only assuming that "development and refinement of cellulosic production technologies and feedstocks can be accelerated." What the article doesn't say is that those levels of ethanol production will also require massive new investments in infrastructure and consumer acceptance of reduced performance, as ethanol is incompatible with the infrastructure currently used to distribute gasoline -- and is less energy dense than that product.  The study does point out that low oil prices make cellulosic ethanol a highly problematic investment, and the study’s authors reportedly "suggest that the government may want to provide mechanisms—such as greenhouse gas taxes—to help level the playing field for cellulosic ethanol." Level playing fields, yes; thumbs on a scale no.  With advanced biofuels that have the same performance and distribution characteristics as conventional fuels on the horizon, and electrification of many transportation options seemingly right around the corner, policy-makers would do well to adhere to a principle of performance-based technology neutrality.  Just because cellulosic ethanol is better than conventional corn ethanol doesn't mean government should move its thumb from the corn scale to the cellulosic scale.  If all technologies can compete on price and performance, the market will sort it out.