Report calls for government incentives to bring biofuels to the pump and to reduce greenhouse gas emissions

A new report shows that America can produce 25 percent of its transportation fuel needs from agricultural crop wastes – utilizing new processes developed by the biotechnology industry – while reducing carbon and greenhouse gas emissions. ‘Bringing Biofuels to the Pump,’ from the Natural Resources Defense Council, recommends that the United States invest $1 billion over the next 10 years in bioethanol commercialization to “drive the development of the first billion gallons of bioethanol capacity at a price approaching that of gasoline and diesel.” The Biotechnology Industry Organization supports that recommendation and agrees with the NRDC that development of cellulosic biofuel is economically and strategically vital to helping end America’s dependence on imported oil.

“The Senate version of the energy bill [HR 6] currently in conference committee contains an 8 billion gallon renewable fuel standard and establishes a reverse auction for the production of the first billion gallons of ethanol made from cellulose-containing crop wastes,” said Brent Erickson, BIO Executive Vice President of Industrial and Environmental Biotechnology. “We could be producing up to 25 percent of our transportation fuel needs in the not-too-distant future by combining biotechnology and agriculture to produce bioethanol, and this energy bill will be a big stimulus to help us meet that goal.” he added.

The report recommends that the federal government establish a mix of incentives – including loan guarantees, tax-exempt financing and performance incentives – to aid ethanol researchers and producers at each step in bringing cellulosic biofuels to market. The NRDC also recommends capping the total amount of incentives at $1 billion over 10 years, to ensure that the industry becomes self-supporting and economically viable. As technology advances in the next 10 years, these incentives will lower the costs of cellulosic biofuel production to “about $0.93 per gallon – roughly equivalent to the current wholesale price of both gasoline and ethanol from new corn-based facilities,” the NRDC predicts.

Biofuels have been shown to reduce emissions of greenhouse gases. The “Bringing Biofuels to the Pump” report contends that use of cellulosic biofuels can reduce greenhouse gas emissions by 1.7 billion tons per year. The NRDC therefore recommends that renewable fuel standards, such as that contained in the Energy Bill recently passed by the House and Senate, establish a cellulosic ethanol blending requirement that would reach 1 billion gallons by 2015.

Report in PDF format: http://www.bio.org/ind/EnergyFutureCoalition.pdf

BIO represents more than 1,100 biotechnology companies, academic institutions, state biotechnology centers and related organizations across the United States and 31 other nations. BIO members are involved in the research and development of healthcare, agricultural, industrial and environmental biotechnology products.