A draft rule that the U.S. Environmental Protection Agency unveiled Tuesday about how emissions should be measured has the corn ethanol industry in an uproar, while newer next-generation biofuel startups seem to be more welcoming of the move. The rule calls for the inclusion of emissions from “indirect land use change,” which could include the impact of farmers cutting down trees or switching crops to grow corn for ethanol. The additional emissions would be calculated into a total emissions calculation that would determine whether specific biofuels count toward the renewable fuels standard.
The draft rule was announced the day before a show of support from the Obama administration for both corn and cellulosic ethanol. The administration held a call this morning with reporters to discuss not just the EPA rule but also $786.5 million in stimulus funds that will be allocated for biofuel research and commercialization and a task group called the Biofuels Interagency Working Group that will work on development programs and policies.
The EPA rule is the most controversial of the three. While many biofuel advocates favor an emissions standard, EPA Administrator Lisa Jackson on Tuesday morning cited an estimate that biofuels only reduce emissions by about 16 percent compared with fossil fuels. Other studies put the number closer to 60 percent, said General Wesley Clark — an enthusiastic ethanol proponent and chairman of ethanol trade group Growth Energy — and Growth Energy CEO Tom Buis, during a conference call today. Growth Energy’s board of directors includes corn-ethanol companies POET, Western Plains Energy, Amaizing Energy, Hawkeye Renewables, and Green Plains Renewable Energy.
Clark called the modeling “science gone wild” and “way out of line with what other studies show,” and pointed out that attributing things like rainforest clearing to ethanol alone is unfair, as governments choose to cut trees for many different reasons. The good news, Clark and Buis said, is that the current model isn’t set in stone. The EPA plans to conduct peer reviews on its emissions analysis and has formed an interagency biofuels group to help come up with policies to make biofuels greener.
Jeff Broin, CEO of corn ethanol maker POET, said in a statement that he is:
[C]oncerned about the preliminary rule issued by the U.S. EPA that included an indirect land use change penalty for corn ethanol. While many scientists have found significant flaws in the models used to calculate indirect land use change, I think the very concept is flawed and stems from a lack of understanding of ethanol and agriculture.
The vastly conflicting studies out there on emissions from ethanol does make the subject confusing. Last month, when the California Air Resources Board delivered a similar call to include indirect land-use numbers in a state standard, more than 175 scientists signed a letter suggesting that those ethanol emissions numbers were flawed.
Speedy improvements in the technology could also render an easily dated emission-calculation model obsolete. An Argonne National Laboratory study last year concluded that ethanol’s water consumption fell 26.6 percent, and energy use fell 21.8 percent, over a five-year period ending in 2006.
But for some of the newer cellulosic ethanol firms, which will be able to create ethanol from waste, and non-food plants that don’t take up farm land, the ruling seems less threatening. Bruce Jamerson, CEO of cellulosic-ethanol company Mascoma, believes this process will help establish a common scientific basis for a much-needed lifecycle analysis, which will help to value biofuels’ carbon-dioxide advantages. A lack of scientific consensus has resulted in widely varying conclusions from different lifecycle studies today (see examples here and here). Jamerson said he’s confident that cellulosic fuels will come out ahead under any scientifically driven lifecycle analysis. “If we’re going to encourage low-carbon fuels, let’s come up with a common independent agreed-upon scientific standard for what constitutes low carbon,” he said.
Bob Walsh, CEO of algae-biofuel startup Aurora Biofuels, said that while the industry and science community doesn’t yet understand the whole equation of how energy plays into biofuels, it all boils down to the same thing for biofuels companies: Reducing your energy use is good for both your emissions numbers and for your economics. “If you’re energy-efficient, you probably have a good greenhouse-gas model and you’re efficient economically, too,” he said.
Even among companies involved in cellulosic ethanol, though, support isn’t universal. Mark Emalfarb, CEO of biofuel-enzyme company Dyadic International, said the rule kicks the ethanol industry when it’s down. “The economy’s unstable enough,” he said. “Either we have to get off oil or not get off oil. This seems to me to be ‘let’s throw more burdens in [biofuels'] way.'” Emalfarb recommends reducing emissions by supporting cellulosic advancements and technologies that turn carbon-dioxide into fuel or electricity, instead of by penalizing corn-based ethanol.