U.S. Federal Agencies Spending New Funding To Bring Biofuels To A Commercially Viable Level

The Obama administration has just authorized another $30 million in federal funding to advance biofuel technologies.

A basic model of a biofuel production process. Graphic courtesy of the University of Illinois.

The $30 million in multi-agency funds will be used to match private investments to advance the development and production of commercial-scale drop-in (ready to use) biofuels for primary use in military and commercial transportation.

Last week, a multi-agency teleconference – with senior officials from the U.S. Navy, the U.S. Department of Energy, and the U.S. Department of Agriculture - announced the funding.

Secretary of the Navy Ray Mabus explained some of the provisions of the funding, saying the funding “will have to be matched at least on a one-to-one basis,” and justified the need for biofuels says that they “will reduce the need for foreign oil, which is a significant and very well-recognized military vulnerability.”

Mabus was candid in saying that right now we give our foreign oil suppliers “too much of an input on whether our ships sail, our aircraft fly, or our surface vehicles operate, and that one of the ways this happens is that every time the price of oil goes up a dollar a barrel, it costs the Navy an additional $30 million in fuel. We have faced price spikes this year going into the hundreds of millions of dollars.”

President Barrack Obama also similarly said last April that the “Department of Defense estimates that for every dollar increase in the price of a barrel of oil, we incur an additional $130 million in fuel costs.” 

Last August, Obama said, “The United States spends more than $300 billion on imported crude oil per year,” and also last April talked about the three departments “plan to spur private industry and financers to construct or retrofit multiple integrated biorefineries capable of producing millions of gallons of fuel annually from domestic feedstocks and at competitive prices.”

Last week, another investment of $32 million was announced (separate from the $30 million announced) for early stage research to advance biofuel technologies to spur efficiencies and cost reductions in the industry.

Of the $32 million, $20 million will be used by the Energy Department to support “pilot-scale and demonstration-scale biorefineries that could produce renewable biofuels and meet military specifications for jet fuel and shipboard diesel using a variety of non-food biomass feedstocks, waste-based materials and algae.”

“These projects may support new plant construction, retrofits on existing U.S. biorefineries or operation at plants ready to begin production at the pilot or pre-commercial scale. This investment will also help federal and local governments, private developers and industry collect accurate data on the cost of producing fuels made from biomass and waste feedstocks,” added the Energy Department.

Also of the $32 million, $12 million will be used to support up to eight projects focused on researching ways to develop bio-based transportation fuels and products using synthetic biological processing, according to the Energy Department.

Synthetic biological processing converts non-food biomass to biofuels, according to the Energy Department, which adds that these projects will develop new biological systems that can enhance the breakdown of raw biomass feedstocks and assist in converting feedstocks into transport fuels.”

The projects will be led by small businesses, universities, national laboratories, and industry experts. The Energy Department says that so far, it has invested more than $1 billion to support 29 biorefinery projects across the country, and the USDA is also supporting biorefinery projects through its loan programs.

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