Status and Future of Biofuels

Ferguson, Bruce W.¹ (1) Edenspace Systems Corporation, Chantilly, VA

The tripling of oil prices during 2003-2006 helped to spur the commitment of billions of dollars of investment in biofuels research, development and production. Is this commitment sustainable? The rapidly-growing, $10 billion worldwide fuel ethanol market accounts for only 3% of U.S. transportation fuel needs, yet its future growth depends on greater land availability amid forecasts that Iowa will need to import corn by 2008. The ability to cope with greater fertilizer runoff and other environmental burdens from intensive energy crop cultivation, increasing food prices as farmers devote less acreage to food and feed, decreasing agricultural subsidies in response to trade and budget pressures, and changing prices for oil and coal under varying CO2 emission constraints, will be as important to the long term prospects of the biofuels industry as the choice of fermentation, pyrolysis, gasification or other technology pathways.

One of the greatest competitive strengths of biofuels rests in the ability to use genetic engineering and selective breeding to develop dedicated energy crops for enhanced energy yields, lower downstream costs and reduced environmental impact. This newly-acquired capability of tailoring energy feedstocks is unique to biomass, representing a major change from technological capabilities during the oil price shocks of the 1970s and offering the prospect of relatively rapid innovation, product development and cost reduction in biofuels applications. Tailoring biofuel feedstocks offers particular advantages for production of cellulosic ethanol, with benefits that must be weighed against the intellectual property, trade and regulatory challenges posed by widespread use of transgenic crops.