Advanced Biofuels: Creating Jobs and Lowering Prices at the Pump

The following guest blog was authored by Sumesh M. Arora, vice president of the non-profit group, Innovate Mississippi, and director of the organization’s Strategic Biomass Solutions program. Arora recently testified on advanced biofuels before the Senate Agriculture Committee.

2014 is a breakthrough year for the advanced biofuels industry, but this industry is still in its infancy. Currently there is no “dominant design” for advanced biofuels technologies or feedstocks, which means that many different technologies are being perfected that can use a broad array of feedstocks. This is leading to many technical and business innovations ranging from deploying very large scale biorefineries to small modular and even on-farm systems.

Most people do not realize the incredible technological advancements that have been made within the last decade that are enabling non-food feedstocks such as corn stover, woody biomass, lipids, municipal solid waste and some energy crops like switchgrass to be used in commercial scale facilities capable of producing cellulosic biofuels. Achieving a dominant design is very important in this industry, because standardization makes technologies more bankable and much easier to be adopted by the masses.

The only way to ensure that we will have an opportunity to build upon our current successes and help the advanced biofuels industry move towards a dominant design is to maintain long-term, predictable and comprehensive energy policy. The Renewable Fuels Standard (RFS) is a key piece of that long term energy strategy that is already in place and can be credited with spurring the technical innovations mentioned earlier.

The RFS is the common thread between advanced biofuels and first generation biofuels such as corn-based ethanol and soybean-based biodiesel, which provides market certainty for the entire biofuels industry. The current ethanol industry has also made it much easier for advanced biofuels like cellulosic ethanol to enter the market place by providing the underlying distribution infrastructure.

Having a wide variety of feedstocks to pick from gives the advanced biofuels industry the flexibility needed to operate large biorefineries. But due to the regional nature of these feedstocks, we must seek solutions that are appropriate for a given part of the country.

For example, forestry and poultry are two of the biggest industries in the South that can currently supply feedstocks for advanced biofuels. Emerging dedicated energy crops such as grasses and algae also grow very well in this climate, but additional research and market development is still needed to optimize these feedstock supply chains.

Deployment of these technologies will lead to an increase in the number of science-, technology-, engineering- and mathematics-related jobs across the country, which will be difficult to move to other nations and will also lead to rural wealth creation.

However, we need to better connect and leverage federal research assets with local universities, schools, business and nonprofit organizations to accelerate these innovations to market. For example, Innovate Mississippi is an original member among nine partners with the USDA Agricultural Research Service with a goal to facilitate commercialization of ARS research.

I strongly believe that advanced biofuels should be viewed in a more holistic manner to include viable biomass-based energy and biochemical options in gaseous, liquid and solid forms. For example, millions of tons of poultry waste are generated in states from Maryland to Arkansas and the contributions to biogas production from this very viable feedstock have largely been ignored. There are tremendous entrepreneurial opportunities in developing such systems that can lead to rural job growth and keep energy prices low for farmers, while improving soil health and water quality.

While emerging technologies such as advanced biofuels are attracting entrepreneurs and venture capital, we have to learn how to mitigate risks associated with the technologies, markets, management issues, financing options and finally execution of these early stage ventures. The Renewable Energy Venture Startup (REVSup) Academy workshops developed by Innovate Mississippi train entrepreneurs to evaluate and mitigate these risks. Furthermore, linking business plan competitions and business accelerators around the country is critical to encouraging new investments in these ventures.

To close, let me make the analogy that investing in renewable energy is just like investing for your retirement. In this case, we have to invest to diversify our nation’s energy portfolio which is dependent on fossil fuels for nearly 93 percent of its transportation sector needs. And from a timing standpoint, we cannot put off making serious investments in renewable forms of energy until the expiration of those fossil fuels is imminent.

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