Renewable fuels: where we should be

More than one-third of the world’s total energy usage relies on liquid fuels – primarily from fossil fuels. In the first quarter of 2013 consumption outpaced production, and the consumption trajectory is only expected to rise. Energy, especially liquid fuel, involves a global marketplace, and to our benefit in the U.S., Congress passed, and fomer President George W. Bush signed, legislation that not only fosters domestic energy production from more sustainable sources, but also provides a path for important green house gas emission reductions. So when frustration over that legislation – the Renewable Fuel Standard (RFS) – is expressed, and done so overlooking the policy’s fundamentals, history and future impact, it deserves to be addressed.


It’s the Renewable Fuel Standard, not the Ethanol Fuel Standard

The RFS, originated in 2005 under the Energy Policy Act and later expanded in 2007 under the Energy Independence and Security Act, was designed to incentivize the development and growth of a more sustainable liquid fuel infrastructure – one that incorporates renewable fuels into the marketplace. Nowhere does the law say that oil refiners and marketers must meet volume requirements by purchasing and blending ethanol.

So how is it that ethanol has become the poster child for renewable fuel? Because instead of investing in innovation and fostering new technology for truly sustainable renewable fuel solutions that fit with the existing fuel infrastructure, oil companies turned to the path of least resistance – ethanol. It was already there, in abundance, and could be blended with gasoline. This would allow the oil industry to “check the box” and later pin its limitations against the entire renewable fuels industry.

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Seven years later, as mandates have expanded, the oil industry would like to do away with the RFS because it failed to innovate toward a fuel economy that is sustainable, not just for our country but the entire world. So that begs the question: what if the oil industry had pushed for better solutions? There would be more renewable fuel solutions – not just ethanol – available to the marketplace, no doubt about it.

There are a few examples of what is possible. Virent, a company that has partnered with Shell for R&D and market opportunities, converts biomass-derived sugars into renewable fuels that are molecularly equivalent to conventional petroleum. Another case in point, KiOR, has commercially proven its technology using non-food biomass like wood chips to make crude oil in seconds, which can be refined and distributed just like conventional fuel. That’s right, renewable fuel that is equivalent to conventional gasoline and diesel, produced using cutting-edge technology and sustainable biomass instead of depleting fossil fuels. We should be able to point to hundreds of examples like these. It is a shame that the entire oil industry, with all its resources and influence, didn’t strive for more viable renewable fuel advancements. The social, environmental and economic benefit would be theirs to gain.


Renewable fuels will compete

It’s not too late. If the oil industry refocused its efforts spent combating the RFS on actually revolutionizing renewable fuel solutions that not only meet mandates, but are sustainable in every sense, we could be looking at an entirely different renewable fuel landscape today.

Conventional fuel has become more efficient over decades while today renewable fuels are held to an extraordinary standard – and the very industry they are made to fit within has refused to promote the growth and investment necessary to bring these solutions to market. If that shifts, and the oil industry embraces that renewable fuel is so much more than ethanol, we will achieve a better, cleaner and more sustainable fuel infrastructure. A decade ago, the idea that crude oil could be produced in seconds from non-food biomass would have been an anomaly, but it is a reality today.

Every gallon of renewable gasoline or diesel represents fuel produced by American workers from start to finish. It also represents renewable, drop-in hydrocarbon fuels that reduce lifecycle GHG emissions. And finally, it represents facilities across the country in areas where an abundance of non-food feedstock can infuse jobs, economic growth and stability. This means moving one gallon closer to a cleaner, truly sustainable transportation fuel solution.

There are many examples of what a sustainable fuel infrastructure could be, and more importantly should be, as a result of the RFS. A path forward is not the one of least resistance, but one that involves the renewable fuel sector, the oil industry and the investment community alike, putting resources behind what is possible.


Cannon is the president and CEO of KiOR and a member of the board of directors.

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