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We Do Not Have a Simple Solution

Those were the words of Helena Chum, a research fellow at NREL on the topic of advanced biofuels. Forbes just published an article on this:

Biofuels Battle: Chemistry Versus Biology

A lot of the subject matter and the companies discussed will be familiar to regular readers.

There are 1,865 biofuels companies out there, and sometimes it seems that there are at least 1,865 different ways of turning every manner of biological material into fuel for a car, truck, train or plane.

The problem is finding a way of doing this alchemy on the scale of millions of gallons a year at a cost that comes somewhere near the price of gasoline without leveling the world’s forests, sucking the world’s fresh water supply dry or starving the world’s humans.

I wouldn’t have guessed there were that many companies working on this problem. I have harped on the difficulties in scaling these lab experiments up, and Dr. Chum tried to put a price to it:

Despite all the hope, the finish line is not close. Helena Chum, a research fellow at the National Renewable Energy Laboratory, estimates that next-generation biofuels now cost anywhere between $5 and $1,000 a gallon, with a median of about $25.

“The finish line is not close.” “A median of about $25.” Of course that’s based on a certain energy price. If the cost is high because the energy inputs are high, you have a loser no matter the price of a barrel of oil. Which approaches might come in around $5/gal? (You may be surprised that this was the low end, given the claims of so many of making ethanol for $1 or $2 a gallon).

My guess is that lipid hydrocracking to give renewable diesel and propane – so called ‘green diesel – would be on the lower end of the price range. (I explained the difference in green diesel and biodesel here, and then gave a much more extensive explanation in my Renewable Diesel Primer). At the upper end, I have no idea which approach would cost $1000 a gallon, but I might reconsider that approach.

As the article concludes, having 1,865 companies in the game does not ensure success:

So who’s going to win? Certainly not all 1,865 companies. And maybe none will. Maybe the science will be too hard to scale up cheaply. “There has never been as much science and engineering done,” Chum says. “We do not have a simple solution. But the conditions for making it work are there.”

I think ‘winning’ here is going to be on a sliding scale – from marginally economical to moderately economical. My prediction is that the companies that win – and there are probably a dozen or so that have staying power – will still produce a product that is significantly more expensive to produce than gasoline. But the real winners must get their fossil fuel inputs down to a low level, otherwise rising fuel prices may make them less competitive, not more.

I will have Part III of the Vinod Khosla interview posted in a day or so.

May 3, 2009 Posted by | biofuels, green diesel, NREL | 75 Comments