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In China, India, Brazil and Europe, economic and environmental security concerns are giving birth to new government targets and incentives, aimed at reducing petroleum imports and increasing the consumption and production of renewable fuels. Over the next ten years, however, investors in traditional ethanol facilities will face the inevitable prospects of increased ethanol imports, non-food crops for feedstocks, and the imminent maturation of cellulosic ethanol as a competitive ethanol fuel.
"If the promises of competitive, large-scale cellulosic ethanol production are realized, and if nationalist import/export policies for biofuels are further liberalized, then the possibilities for ethanol to replace 20% of gasoline consumption in the U.S., China and India may be realized by the year 2020."
-- William Thurmond, author of Ethanol 2020: A Global Market Survey
"The global market for ethanol faces enormous opportunities and transitional challenges over the next ten years. A few issues hold the key to understanding the transitional nature of these challenges and identifying the best prospects for long-term growth opportunities," said William Thurmond, author of Ethanol 2020: A Global Market Survey.
Thurmond's study, which is being released today at the 23rd International Fuel Ethanol Workshop & Expo in St. Louis, Missouri, by Emerging Markets Online, provides an analysis and review of major ethanol markets, leading producers, feed stock price trends, import-export trends, government targets as well as challenges and opportunities worldwide.
The report reviews biofuels initiatives world-wide, including Bush's new "20% biofuels by 2017" re-vision of the U.S. Renewable Fuels Standard; the European Union's proposed "20 by 20" program to replace 20% of transportation fuels with renewable fuels; and national biofuels target goals and programs for Brazil, China, India, the U.S. and Europe.
"If the promises of competitive, large-scale cellulosic ethanol production are realized, and if nationalist import/export policies for biofuels are further liberalized, then the possibilities for ethanol to replace 20% of gasoline consumption in the U.S., China and India may be realized by the year 2020," noted Thurmond.
The First, Second & Third Generation
Ethanol 2020 identifies three transitional generations of biofuels emerging in the next ten years. The first generation, or 1G, according to Thurmond, is based on traditional domestic production, economics and feedstocks—generally grown and sold near geographically agricultural areas.
The second generation, or 2G, is based on the increasing transition of ethanol production facilities from traditional agricultural areas to new areas in coastal regions in order to take advantage of import, export, multi-feedstock and refinery co-location advantages.
In addition, this second phase addresses the food versus fuel debate, supported by emerging trends in increased production and consumption of non-corn and non-food fuel crops such as sorghum and switchgrass.
This is also true for biodiesel, where non-food feedstocks such as algae and jatropha produce significantly higher returns per acre, and do not compromise food supplies or stimulate higher food prices.
Ethanol 2020 observes the third generation, or 3G, is based on emerging technologies and production processes such as cellulosic ethanol, biobutanol, and dimethylfuran that promise higher fuel production and investment returns per acre at lower costs.
The upside to 2G and 3G transitions, the study speculates, is they provide answers and solutions to current problems with rising feedstock costs, energy infrastructure integration issues, the food vs. fuel debate, and eventual price relief for consumers at the pump. During these transitions, new opportunities will emerge for ethanol investors, and new technological processes will improve the present production facilities of today and help alleviate concerns of ROI and stranded costs.
"As these transitions occur, we expect to see an increasing amount of cognitive dissonance and political debate between established ethanol producers, the emerging 2G/3G investors and stakeholders, policy officials and analysts," said Thurmond.
"Moreover, these transitional trends and technologies are likely to be critical to the success of government biofuels programs world-wide with ambitious ethanol production targets. Although growing pains will occur, the emergence of 2G and 3G ethanol will help overcome many of the present limitations of agricultural, commercial and technological ethanol production," he concluded.
I do not see skepticism in Swenson's response. I see knee-jerking reaction, as is becoming all too typical of anti-biofuels backlashers. This is evidenced by the apparent incapacity to make distinctions between the different generations of biofuels. It's all "madness." If you look in on the work of the David Tillman group at University of Minnesota, you will see a potential for restoring mixed species prairie perennial grass ecosystems that actually accumulate more carbon in the soil than is released in the entire biofuels lifecycle, so the group calls these carbon-negative biofuels. In addition to soil restoration, they grow in droughty areas and on degraded soils, so they are just what we are going to need in areas where grain production is becoming impractical due to soil depletion and climate change.
In a more immediate prospect, many wheat farmers find oilseeds such as canola a great rotation crop that rebuilds soil fertilility. Potato farmers find a mustard rotation a way to naturally fumigate the soil and reduce the use of chemical soil fumigants. If we make biofuels markets for these oilseed crops, more farmers will be able to economically plant them and so the cultivation of major crops will become more sustainable. There are many examples like this where creating biofuels markets leads to improved environmental and economic sustainability for agriculture.
And let's not forget what we're replacing, petroleum. From listening to the knee-jerkers, it seems that they would prefer to continue using petroleum fuels, despite the fact that climate change will cause billions to suffer water stress and millions to die of famines. Of course we need much more efficient cars, more intelligently designed communities and other fuels such as electricity. And sure, we need to be aware of land use changes that release greenhouse gases, such as removing rainforests to grow palm. But overall, biofuels are superior to petroleum fuels. Let's keep that in perspective.
Ron is right and skepticism is quite different from pessimism, just as ignorance is not necessarily a sign of low intelligence. Brazil's energy independence is not a result of ethanol.
Were the tariff on Brazilian ethanol lifted, both E85 and pure ethanol prices would drop dramatically.
while simultaneously the clearing of Brazilian carbon sinks and biodiversity loss would increase dramatically. Cane is far more efficient than even cellulosic.
TOUCHE!
The 'Ferment' inthe biofuels research field is phenominal and global in nature.
Brazil is already independent of fossil fuels for vehicles; why not China or other countries that are heavy importers.
Were the tariff on Brazilian ethanol lifted, both E85 and pure ethanol prices would drop dramatically.
Last week, someone offered me spores of a fungus which broke down cellulosic walls and lignan to 'try out'...leading me to believe there is a lot more 'out there' we simply don't know about.
2G, 3G, 4G. It all adds up to one thing: trashing the planet's remaining biological treasures cloaked in the rhetoric of saving the environment. Here's one more article full of superlatives without any grounding in hard facts. When data is given, will we see anything but the usual claims based on prodigious amounts of unobtainium, without compromise of soil and water resources? How can we stop this madness?
See <A href="http://www.ecotopia.com/ases/SolarToday/BiofuelsScienceOrFiction.pdf">Biofuels: Science or Fiction</A>?
The conversion of materials into biofuels which are at present wasted has to be a good thing but even here one must be cautious. The use of corn stover, for instance, would appear to be an excellent idea but must be weighed against the positive effect of leaving the stover in the field to rot and improve the soil. The negative effect of not leaving the stover in the field will only be apparent after a good few years by which time the soil will have lost much of its humus and with it its production capacity.
The Conversion of waste paper, garden clippings sewage and compostables into biofuel, rather than sending it to a land fill or in the case of sewage, into the sea, would seem to be a good thing but perhaps there is an even better alternative. If all this material was composted and put back on the soil, great gains in fertility would be achieved. One could argue that the only reason that China still supports such a large population after some 5 to 8000 years of continual occupation is because they return almost everything back to the soil.
What is really frightening is the thought that the remaining jungles may be cleared to produce crops for the production of biofuel.
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