RUNNING HEAD: Growth Potential for Biofuels
Biofuel: Energy Independence?
December 13, 2009
Growth Potential for Biofuels 2 Executive Summary This paper will discuss the history and growth potential for biofuels as a way to relieve our dependence on foreign oil in the United States. It will look at the different sources available to produce biofuels, and whether biofuels would actually result in a reduction of green house gases. Lastly, I will discuss the controversy of taking food stock away from the food supply chain and turning it into fuel, causing possible increases in global food prices.
Currently the United States imports 317 billion gallons of oil from around the world each year (http://tonto.eia.doe.gov/ask/crudeoil_faqs.asp). This is a major threat to our security because our commerce, defense, and livelihood depend on foreign oil. Because of the current wars in the Middle East, and the sudden increase in oil prices a few years ago, there has been renewed interest in expanding the United States production of biofuel and biodiesel. Biofuel or ethanol is a replacement, or additive, for conventional gasoline; where biodiesel is a replacement to conventional diesel. According to the US Department of Agriculture (USDA), most gas stations in the US now have ethanol as an additive to the gasoline we purchase on a regular basis (www.usda.gov).
History of Biofuel Biofuel and biodiesel are not a new development, rather, Henry Ford’s first car ran on biofuels, and the diesel engines were designed to run on peanut oil. When petroleum oil was found to be inexpensive, and readily available, it replaced biofuel and biodiesel, it has been the dominant fuel source since then. The oil embargo of the early 1970’s brought about interest in a way to extend gasoline supplies. In Brazil this brought about a major change in the national strategy for fuel production and the car manufactures. Brazil grows sugarcane in large quantities
Growth Potential for Biofuels 3 from which they produce their biofuel. Recently, Brazil has become completely independent from foreign oil; they produce 4.8 billion gallons of ethanol fuel each year for their cars and trucks (Bourne 2007).
Current Process The process of making biofuel and biodiesel is a straight forward process where the sugars, starches, or plant fiber from the corn, sugar cane, or plant mass is fermented and turned into alcohol that is then burned. This process is similar to making beer or whiskey. The corn is mixed with water and heated then the starch is converted to sugar. The yeast turns the sugar mixture into alcohol is then removed from the water. The left over grain is fed to cows and the remaining water, which is high in nitrogen, is used as fertilizer.
Predicted Growth The predicted growth of biofuel over the next decade is very promising. Currently the United States has the capacity to produce 5.6 billion gallons of biofuel. The Energy Policy ACT of 2005 mandates the production 7.5 billion gallons of biofuel by 2012. Former President Bush in his January 23, 2007 State of the Union address, urged Americans to increase that number to 30.1 billion gallons of ethanol by 2017 (Baker, A, Sahniser, S, 2006). We are very near our maximum capacity for biofuel production and more manufacturing plants will be required to reach this goal. The United States government is making $200 million available for loans for building biofuel manufacturing plants (Bourne 2007).
The price of corn has spiked in recent years, in turn causing farmers to plant the largest corn crop since World War II. About a fifth of the corn harvest will be converted to ethanol;
Growth Potential for Biofuels 4 more then double the amount from five years ago (Bourne 2007). As seen by the graph below, over the last 10 years the price of corn has gone up 96.74%. Supply and demand economics suggests that as prices increase more farmers will want to capitalize on...