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Green Tech States Are Not Necessarily Democratic

Written By empapat on Kamis, 20 September 2012 | 07.37

Most people would expect blue Democratic states to be eager to embrace clean tech and green jobs, the authors assert, with red Republican states resolutely declining to join in the action. However, according to the report, in the 10 states where clean tech jobs are growing the most quickly, only two can be considered traditionally Democratic – Hawaii and New York. Many of the remaining states are decisively Republican, including North Dakota, Nebraska, Wyoming and Alaska. Additionally, among Top 10 states where green jobs make up the biggest percentage of the labor force, only three – Washington, Oregon and Vermont – are Democratic.

"What's more, many of the governors working the hardest to bring clean tech jobs to their home states are not only Republican, but are usually regarded as leaders of their party," according to the report. This demonstrates that clean tech and green jobs are only contentious inside Washington D.C., the authors conclude. "Outside of the capital, where governors (and mayors) are more concerned with creating jobs than scoring debate points, there is no controversy about the impact of clean tech." 

"(Clean tech) is almost universally appreciated as the important engine for job development and economic growth that it is," the authors say. "Disregarding the partisan bickering in Washington, these local officials are using clean tech to bring high-quality jobs to their states, in the process reviving communities and winning the support of local voters in both parties."

Zooming out even further, the report reveals that seven of the top 17 states with the most rapid growth in the clean tech sector are considered swing states for the 2012 presidential election. "Numbers like these suggest we are entering an era in which politicians who unfairly criticize or otherwise ignore clean tech run the risk of alienating a bedrock constituency: job holders, most of whom vote," the authors say.

A copy of the report is available here.

Lead image: Divided flag via Shutterstock

20 Sep, 2012


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Source: http://www.renewableenergyworld.com/rea/news/article/2012/09/green-tech-states-are-not-necessarily-democratic?cmpid=rss
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The Demonization of Clean Tech: The Five Biggest Myths

As a longtime analyst at clean-tech research firm Clean Edge and contributor to the recently published book Clean Tech Nation (coauthored by Clean Edge colleagues Ron Pernick and Clint Wilder), I should be on the front lines defending the clean-tech moniker. But given the noticeable intensifying of false debates surrounding clean tech in the last year, it's worth taking a moment to examine ways in which the industry's far-reaching identity has opened the door to some misplaced antagonism.

#1: Energy Sources as Sports Teams

Unless you are employed in a particular sector of the energy industry, as long as the car runs, the lights are bright, the showers hot, and the beer cold, it makes little sense as a consumer to root for one specific energy source against another, as if they were sports teams. Solar power isn't the Miami Heat, and – as much as T. Boone Pickens would like you to believe it – natural gas isn't the Oklahoma City Thunder.

Of course, it's imperative to evaluate energy sources based on availability, affordability, and environmental impact. But blind support of identifiers like traditional energy, alternative energy, renewables, or clean energy – which aggregate many dissimilar resources and technologies – can quickly create an "us versus them" culture. And that's exactly what seems to be playing out on the national political stage in this election season. When the failure of one longshot solar startup (that shall not be named) can be used to demonize all aspects of a multi-hundred billion dollar industry, perhaps the umbrella is too large.    

#2: The Misrepresented History (and Current Reality) of Energy Subsidies

Government has always played an important role in energy innovation. Nuclear power plants are offshoots of nuclear submarines, which themselves are derivative of atomic bombs developed by the Manhattan Project – the ultimate embodiment of government-funded R&D. Less understood is that today's shale gas boom also owes much to government involvement, as recent technological advances are fruits of decades of public-private research and commercialization efforts, as the Breakthrough Institute detailed well in a recent report. 

Unabashedly ignoring this history, The Wall Street Journal's editorial team recently used a snapshot of 2010 federal subsidies to argue that renewables don't merit government support because right now "wind and solar get the most taxpayer help for the least production" – an argument that only makes sense if 2010 was the lone year subsidies were ever available. Surprisingly, the universe did exist prior to January 1, 2010, so we don't have to rely on such disingenuous analysis. A report by DBL Investors' Nancy Pfund and Yale University graduate student Ben Healey, which looked into the historical role of U.S. federal energy subsidies, found that annual federal support for oil, gas, and nuclear has averaged 22 times the amount of subsidies available to renewables.

This extreme imbalance is one reason why Clean Tech Nation's Seven-Point Action Plan suggests phasing out all energy subsidies over the next decade. We know that's a controversial proposal, but let's debate the future of subsidies based on facts, not myths.

#3: The False Promise of Energy Independence

"Lobsters are cheap in Maine because storing and shipping live lobster is hard, but globally traded commodities aren't like that," says Slate's Matthew Yglesias in what might be the most effectively concise dismissal to date of the U.S. energy independence delusion. 

Yes, U.S. reliance on foreign oil has fallen amidst an Obama-era domestic production boom – allowing for fewer direct imports from petro-dictator nations. But unlike lobsters, oil is easily stored, shipped, and traded across borders, so America's oil fate will forever be linked to conditions defined by the global free market.

And if American energy "independence" was truly a top concern, vehicle electrification would be priority number one, as 99 percent of U.S. electricity is derived from domestically-generated electrons. Yet instead of being hailed as uber-patriotic "DEVs" (domestic energy vehicles), electric vehicles continue to fight perceptions of simply being expensive eco-toys.

#4: There is No Such Thing as a Green Job

Granted, this is a tricky one, as definitions vary widely – so claiming a direct link between these jobs and a remedy for the economy often does little more than fuel opposition to all industries involved when the nation's labor market proves stubbornly sluggish. Opponents can claim, for example, that it takes fewer than 30 workers to maintain a 250 MW wind farm that powers 75,000 households. But as a recent NRDC report finds, that same wind farm will actually create 1,079 jobs over the lifetime of the project, mostly during manufacturing and construction.  

There are plenty of wind turbine technicians, increasing masses of solar installers, and armies of workers at the world's largest industrial conglomerates working on products to beef up the electric grid, boost vehicle efficiency, and convert waste into resources. As demand for clean-tech products and services grows, an expanding workforce will obviously be an economic boon.

#5: The Climate Change "Debate"

When even Koch brothers-funded researchers conclude that the world is warming and humans are to blame, it's time to stop arguing the science and start focusing on solutions. But this doesn't seem to be the trajectory of things. Climate change continues to be politically toxic, and demand for clean tech – the market's answer to a changing climate – is being severely hamstrung as a result.    

In place of real climate action, U.S. leadership on both sides of the aisle is clinging to an "all of the above" energy approach. But until the current subsidy outlay changes, in no way will this translate into a level playing field. 

Ultimately, clean tech – or green tech, or advanced energy, or whatever you choose to call it – will win out. The realities of a resource-constrained world and changing climate are just too powerful to ignore. But as clean tech moves forward, it's increasingly important to understand the steadfast opposition – and its myth-making operation – facing this innovative sector that dares challenge the status quo. 

Lead image: Myth via Shutterstock

20 Sep, 2012


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Source: http://www.renewableenergyworld.com/rea/news/article/2012/09/the-demonization-of-clean-tech-the-five-biggest-myths?cmpid=rss
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Studies Cite Increased Demand for Wind Power, Other Renewables

Written By empapat on Rabu, 19 September 2012 | 12.39

According to the Global Consumer Wind Study 2012 (GCWS), the desire for more renewable energy options was voiced by 85 percent of survey respondents, with 49 percent saying they'd have no problem digging deeper into their pockets to support companies committed to renewable energy in the product manufacturing process. Even more encouraging, those numbers spiked considerably when consumers were asked specifically about wind power, with 62 percent indicating that if given a choice, they would consciously choose to buy products manufactured using wind over traditional forms of power generation.

These statistics bode well for the efforts of WindMade, a nonprofit whose primary function is the identification of companies and products that rely on wind power for at least 25 percent of their overall electricity generation. The organization's ultimate goal is not only to give eco-conscious consumers the information necessary to vote with their wallets, but also to generate interest for an industry whose potential still vastly exceeds its demand.

"One of the important challenges the [wind power] industry is facing in many markets around the world is public acceptance," writes Angelika Pullen, Communications Director for WindMade. "Our objective is to help address this problem by creating a tool for that majority of the public that is supportive of wind power, to identify and favor those brands and companies that are using wind energy." 

But public acceptance is one thing — actual corporate espousal of renewable energy is another. And in an era where social and ecological consciousness ranks high in the area of mass appeal, new evidence has come to light that tells us not all private companies are riding the aforementioned fence over whether to pursue renewable alternatives. An increasing number are leading the charge, as evidenced by the second of the two studies, the Corporate Renewable Energy Index Report 2012 (CREX).

According to the results of the report, global corporate investment in renewables has surpassed investment for fossil fuel generation by a significant margin. In 2011, corporations around the globe spent $237 billion investing in renewable energy, eclipsing the $223 billion spent chasing fossil fuel power generation. The CREX is an index that ranks companies by their level of investment in renewable energies. The report also found that 40 percent of renewable energy purchases made in 2011 were made by companies for the purpose of on-site power generation, showing a marked increase from previous years.

The GCWS survey was conducted by TNS Gallup, and the CREX report was prepared by Bloomberg New Energy Finance.

Lead image: Demand chart via Shutterstock

20 Sep, 2012


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Source: http://www.renewableenergyworld.com/rea/news/article/2012/09/studies-cite-increased-demand-for-wind-power-other-renewables?cmpid=rss
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Is the EU Abandoning Biofuels?

At present, biofuels represent 4.5% of the EU's transportation fuel consumption, with essentially all of this coming from food crops – so, essentially, food crop-based fuels would be capped at not much above existing levels – not much room for growth.

Long-time coming or new trend? Threat or opportunity? Those are the questions being asked around the EU today — and across the globe amongst EU trading partners and fuel developers.

Here are the knowns and unknowns. The questions come down to five.

1. Will this proposal become law?

We believe this is a "yes", but with modifications to carefully define crop-based feedstock. After all, you can eat algae – and petroleum comes, ultimately, from food-based feedstocks, just produced over millions of years instead of minutes or seconds. Simply banning any fuel made in any way related to a crop, or biomass that can be grown as a crop, could lead to a ban on all transportation fuels, including natural gas-fuel vehicles or electric cars powered by coal, gas-based power. The devil is in the detail, as Mies van den Rohe was wont to observe.

2. What is the impact on EU biofuels targets, pegged by statute at 10 percent by 2020?

The targets are law, and law as hard to unwind as it is to pass in the first place. We think the targets will not be altered – but, rather, we'll see fuzzy math employed. There's already a proposal to quadruple count algae-based biofuels. That means you could meet the EU 2020 target with half the fuel produced today, if algae was employed as a feedstock. Future shortfalls will simply be addressed by amping up the bonus on advanced biofuels. Quintuple, sextuple counting? It could start to look at 1923-style German inflation before it is all over.

3. What's the impact for advanced biofuels, utilizing non-food feedstocks?

First of all, let's refer to #2 – depends on the extent to which the EU doubles, triples, or quadruples the value of advanced biofuels – and the extent to which the EU will tolerate non-food feedstocks grown, for example, on the same land once used for food-crops.

At some stage, someone might take the point of view that replacing an acre of, for example, 160-bushel per acre of corn, which would provide nearly 500 gallons of fuel and 1.3 tons of animal feed with a 40 bushel per acre non-food crop, which provides 120 gallons of fuel and some inedible lignin, is not exactly the goal of policy.

Long-term, algae looms as a major beneficiary, if hybid systems as developed by the likes of BioProcess Algae make the grade – or solar fuels of the type produced by Joule. In the nearer term, highyield energy crops that can be grown on marginal land – that is, not currently in production (i.e. made marginal by food crop economics, not by the ability of the land to support agriculture) – well, the impact could be material.

One other matter we will hope to discover – the extent to which aviation biofuels – not just road transport – will count in the overall calculations.

At Raymond James, energy analyst Pavel Molchanov writes, "There is no question that the new policy would meaningfully support adoption of energy crops. This can be segmented into two separate trends. First, we would expect to see actual cultivation of energy crops in EU members with large agricultural sectors (such as France and Poland). Second, in countries where population density or other factors result in small agricultural sectors, imports of energy crops (from, say, Brazil or North America) would be the realistic solution."

4. What's the impact for food crops?

It's not all bad – look for a shift from biofuels to higher-value biobased products and renewable chemicals, which are generally unsubsidized and un-mandated anyway, and offer good returns on investment for selected crops, such as maize.

5. What's the impact for biofuels producers and their existing plants?

To the extent that they can support different feedstocks, such as renewable sugars made from waste, or waste-based fats, oils and greases, not much of a change. For others, look for bolt-on technologies like we see with corn ethanol plants in the uS, that foster a switch from producing fuel ethanol to the production of isobutanol or n-butanol for the chemicals markets.

The bottom line.

It won't be business as usual – far from it – but the technologies and feedstock options have been sufficiently advanced over the past 5 years that the impact will be far from dire. It's payback time for all the far-sighted developers that fostered alternative technologies and feedstocks.

This article was originally published on Biofuels Digest and was republished with permission.

Lead image: Biofuels via Shutterstock

19 Sep, 2012


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Source: http://www.renewableenergyworld.com/rea/news/article/2012/09/is-the-eu-abandoning-biofuels?cmpid=rss
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The Big Question: What Can We Expect over the Next 12 Months?

Written By empapat on Selasa, 18 September 2012 | 07.48

Maria van der Hoeven, Executive Director, International Energy Agency

Renewable energy continues to grow in the face of both economic crisis and subsidy reductions in key markets. The technology portfolio is expanding, with generation from wind, solar PV and bioenergy growing in double digits year-on-year. Hydropower continues to grow steadily and remains the largest renewable source in absolute terms. Even geothermal and ocean energy are growing. That growth is being driven by emerging and developing markets outside the OECD - and we expect this contribution to accelerate.

One striking trend is the geographic spread of renewable energy projects, often to totally new markets. Just a few years ago, only a handful of countries hosted significant solar, wind, or bioenergy projects — but renewable energy projects are now taking root across Asia, in Latin America, and in Africa and the Middle East.

While we see growth across renewable technologies, of course the trends for each vary. Solar PV is particularly striking. Stagnating economies and electricity demand, combined with feed-in tariff reductions and other support limitations, are slowing down European PV growth. But that is compensated for by increases in China, the US, Japan and India, and also driven by a rapid fall in component costs. And with falling costs comes intensified global competition. A consequent shake-up of the industry should ultimately bode well for its long-term health. Companies surviving the current consolidation are restructuring and successfully transitioning from subsidized markets to new and potentially more competitive market segments.

Finally, although wind and solar often grab headlines, hydropower remains the largest renewable source by a wide margin. And despite its more sedate image, hydro's growth continues at a healthy pace, driven by the need for baseload capacity in emerging economies, and by increasing pumped storage demands in countries seeking to integrate more variable renewables.

With an outlook marked by growth and driven by emerging economies, these trends are likely to continue and accelerate into the medium term.                      

Birger T. Madsen, Director, Navigant's BTM Consult APS

The global wind market has undergone a dramatic transformation over the past two decades. In 2011, it defied the fragile Western economic climate with a record level of global installations (around 42 GW). There is no doubt that although much of the IP and highest ranking turbine OEMs reside in Europe, the balance of power has shifted to Asia and specifically China, the number one market in the world. 

The wind industry was largely unaffected by the credit crisis, but now is feeling its hangover. It is faced with an overcapacity of turbines and some core components, limited credit availability, high material prices, shortages in skilled labor, continuing low U.S. gas prices and Chinese turbine and core component suppliers producing at lower costs than western competitors. This has resulted in Western companies reducing prices and profit margins, resulting in a strategic rethink of their earlier ambitious targets and aggressive investment decisions made during the boom of 2008. Despite this, the investment level available to the wind industry remains high, but there has been a marked evolution in the shape and face of the investment vehicles available, most notably in the offshore sector.

Looking ahead over the next 12 months, the Chinese market will still constitute the lion's share of global installations despite a drop in annual installations, with Europe seeing a flat level of growth and the US seeing a spike as companies seek to capitalize on the PTC before it expires at the end of 2012.

It is, however, the Latin American, Indian, Eastern European and European offshore markets which are expected to provide the main impetus in installations moving forward.

It's crucial that transmission capacity is improved in time to facilitate the expected offshore progress in northern Europe. Furthermore, it is expected that there will be a continued shift towards the use of direct drive technology and an increasing interest in two-bladed wind turbines.              

Andrew Beebe, CCO, Suntech

Rumors of our industry's death have been greatly exaggerated. Yes, it's true that upstream module oversupply is thinning margins and eroding profitability. But the global solar market will still grow in 2012, just not at the pace we're used to. Although it's a tough time to be a solar manufacturer, it's a great time to be a solar consumer. That's what matters. 

For the first and last time, the price of solar modules has breached the US$1/W mark, a harbinger of cost-competitive solar. We have finally reached the tipping point. New markets are emerging, and the potential for growth is astounding. 

Of course, to achieve this growth, solar companies will need to endure a market that is slowly digesting excess capacity and ensuring that only the most efficient producers survive. As the industry moves through this consolidation phase, we expect bankability to separate the wheat from the chaff. We are witnessing a 'flight to quality', where customers are looking for a reliable and trustworthy brand that can uphold its end of the promised 25-year relationship.

In addition, innovation will define future leaders. In previous years cost reductions came from both technology improvements and declines in key material prices; in coming years innovation will take centre stage. Companies that have a technology heritage and have invested heavily in R&D will be able to innovate ways to redesign cells and modules, to effectively use cheaper ingredients and to scale higher conversion efficiencies.

Despite the skepticism of critics, we can expect the industry to continue on a moderate growth trajectory in 2012 and to accelerate into 2013. The consumer's good fortune bodes well for the industry as our ultimate goal is to make solar power a viable and affordable energy choice.

We knew that solar manufacturers would have to go through this ultra-competitive "Valley of Death". Consolidation is maturation. Amidst unfounded political skepticism of our industry's long-term health and potential, we must stay focused on what matters.

Andrew Oldfield, Head of Cleantech, Mercia Fund Management

There is still a lot of work to do to move UK climate chief Lord Stern's central thesis (that the true cost of not acting on environmental issues is far greater than the cost of investing in alternative technologies) into the political mainstream. It is being questioned whether green is compatible with growth, when in fact it should be synonymous. Community led cleantech companies offer a viable approach, commercializing disruptive innovations without the heavy investment the sector has demanded in the past. 

In solar, for example, new business models will be enabled by technology advances bringing existing low-cost industries into the supply chain. This will require equity finance to build some exciting early stage SMEs [small and medium-sized enterprises] in a capital efficient manner. The financial backdrop is not healthy: for example, seed stage venture investment in the UK has dropped every year from 2006 (about £400 million [US$620 million]) to last year (about £10 million [$16 million]). This is seriously affecting the ability of UK cleantech entrepreneurs to get their ventures funded.

There is a perception that early stage ventures do not offer an attractive risk-reward profile. The reality is that seed stage investment has often been through publicly backed funds with significant restrictions on follow-on investment. These funds have therefore shouldered the operational risk inherent in backing early stage, high growth companies - some of which do fail - without being able to invest in the winners that do eventually emerge. This negatively skews the true value of early stage investing on average. 

The UK urgently needs to re-seed its early stage venture capital market, with substantial funds going into cleantech sectors. A fully functioning seed fund will do 80 per cent of its deals in seed, but 80 per cent of the money goes into later rounds. Community-led cleantech will help returns, but government help is needed to correct the perception that early stage is not an attractive place to invest. Once corrected, the market will take over the job. 

In the end the sector needs to stand on its own feet. Ironically this requires more early stage funding so the financing of disruptive innovation can be shown to be attractive and therefore self-sustaining.

Sven Teske, Renewable Energy Director, Greenpeace International            

The renewables industry's circumstances have changed fundamentally over the past five years. Renewables became mainstream, economic, and grew out of their sometimes wild teenage years. And even faster growth across all renewable energy technologies is more important than ever.

A certain amount of climate change is now "locked" based on the amount of CO2 and other greenhouse gases emitted into the atmosphere since industrialization began. On the 25th anniversary of the Chernobyl catastrophe yet another nuclear incident underlined the urgent need to rethink global energy strategies. The Fukushima disaster sparked a surge in global renewable energy and made at least some governments reconsider their energy approach. At the same time, the poor state of the global economy has resulted in decreasing carbon prices, some governments reducing support for renewables, and a stagnation of overall investment, particularly in the OECD. Rising oil demand is putting pressure on supply, causing prices to rise and making possible increased exploration for "marginal and unconventional" oil resources, such as regions of the Arctic newly accessible due to retreating polar ice, and environmentally destructive tar sands in Canada.

For almost a decade it looked as if nothing could halt the growth of the renewables industry. But the economic crisis and its continuing aftermath slowed growth and dampened demand. While the industry is slowly recovering, increased competition, particularly in the solar PV and wind markets, has driven down prices and shaved margins to the point where most manufacturers are struggling to survive. PV prices fell more than 60 per cent in the past two years, with costs not always following. More production capacity - not only for PV - is a must to get to the market size needed to save the climate and supply enough energy to growing economies such as China and India.

A renewable energy market of around 200 GW by 2020 is required. The big question is whether governments around the world will provide the reliable policy framework needed, and if infrastructure will be adapted to renewables not the other way round. 

Lead image: Question marks via Shutterstock

18 Sep, 2012


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Source: http://www.renewableenergyworld.com/rea/news/article/2012/09/the-big-question-what-can-we-expect-over-the-next-12-months?cmpid=rss
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Floating US Biofuels: Should the Navy Support a New Industry?

Written By empapat on Senin, 17 September 2012 | 06.50

These days, it's common to see a household with at least one car in its driveway. That same house is also likely to hold a personal computer. And the inhabitants of the home are just as likely to own a smart phone. But just one decade ago, most consumers could not have dreamed of owning these possessions. How did these innovations come to fruition? Each of these industries — automobile, computer, phone — went through periods of research and development, consolidation, and scale to become affordable and attractive to the major public market. The renewables industry is going through this same process — and the biofuels market is no exception.

But to become large-scale and cost-competitive with fossil fuel, the biofuels industry must continue to travel through a major research and development phase — a phase which also requires major investment. This is where the United States military — and controversy — enters the picture.

The history

The U.S. military, the Navy in particular, has been a major supporter for the advancement of the biofuels industry. In fact, the Navy has pledged to get 50 per cent of its operational requirements for liquid fuels from alternative, non-fossil sources by 2020 — an ambitious goal for such a young biofuels industry. But the military is passionate about the initiative and has taken major strides to bring it to fruition, claiming that its major priority is to achieve energy independence. 

"We're pursuing alternative energy because our reliance on foreign oil is a very significant and well-recognized military vulnerability," said Secretary of the Navy General Ray Mabus. "Energy security has got to be at the top of our agenda. The ability to use fuels other than oil and gas is absolutely critical. It will increase our flexibility, it will increase competition, and it will reduce the service's vulnerability to rapid and unforeseen changes in the price of oil."

The controversy

In December 2011, the Navy purchased 450,000 U.S. gallons (1.7 million litres) of cooking oil- and algae-based drop-in biofuels for jets and vessels to be used by the Great Green Fleet at the biennial Rim of the Pacific (RIMPAC) demonstration, the world's largest international maritime exercise, during summer 2012 off Hawaii. Dynamic Fuels produced the cooking oil-based fuel and Solazyme provided the algae-based product — each has been developed as a direct replacement for conventional fuels in engines without any modifications.

These biofuels were mixed in a 50/50 blend with traditional fuel, which cost around $15 per gallon. The Navy intends to achieve full-scale deployment of this type of blend by 2016. 

But just one month before RIMPAC, the biofuels industry and the military encountered a possible roadblock. The House and Senate Armed Services Committee issued its report on next year's Pentagon budget with Pentagon Budget Bill, HR 4310, which included a measure to exclude the development and purchase of biofuels that cost more than traditional fossil fuels.

The exclusions, however, do not eliminate all alternative fuels. The Committees recommend the Defense Department's exemption from previous restrictions that prevent federal agencies from buying fuels that are more polluting than conventional fossil fuels. This would allow the military to use the Fischer-Tropsch method, which generates gas to liquid fuel from coal and natural gas — and also emits more carbon than burning refined crude oil.

With a shrinking defense budget, the committees believe that the military should focus on creating more vessels, supplies, and other necessities, rather than pushing money into a new, risky and expensive industry.

"I understand that alternative fuels may help our guys in the field, but wouldn't you agree that the thing they'd be more concerned about is having more ships, more planes, more prepositioned stocks," said Representative Randy Forbes during a hearing with Mabus. "Shouldn't we refocus our priorities and make those things our priorities instead of advancing a biofuels market?"

The bill passed through the Senate Armed Services Committee with a 13-12 vote and the House with a 299-120 vote, creating a backlash throughout the government and biofuels industry.

Agriculture Secretary Tom Vilsack expressed his frustration with the decision during a conference call: "It's beyond me why we wouldn't help this industry that will create higher farm income, more jobs in rural America, reduce the costs for consumers, satisfy commercial airlines and make our military less reliant on a foreign supply of energy," he said. "It is just astounding that people don't understand that."

Vilsack explained that the future of the biofuels industry is closely tied with the military, especially the Navy, and investments today will help bring down costs in the future — and costs have already come down. The Navy purchased biofuels in October 2010 at $42.40 per gallon, but paid $26.67 per gallon for the RIMPAC exercise, which then cost $15 per gallon when blended with traditional fuel.

Though the Committee's goal is to reduce overall costs and purchase the current lowest-priced fuels, military officials argue that with each one dollar increase in the price of a barrel of oil, it costs the Navy about $30 million. In 2012, the Navy was presented with a nearly $2 billion bill for additional fuel costs, which was paid by moving funds from Afghanistan — officials say that this is not sustainable and can be detrimental to the military.

"If we do not do something to tap down these price spikes, there are only a couple places that we have money to get for additional fuel costs," said Mabus. "One is operations, which means we steam less, we fly less, we train less. The other is to take platforms, ships or airplanes away. I don't want to have to make that choice."

A coalition of 13 aviation groups have also banded together to protest the Committee"s decision, claiming in a letter to the Senate that the bill would severely damage the advancement of the biofuels industry and hinder American energy independence.

17 Sep, 2012


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Source: http://www.renewableenergyworld.com/rea/news/article/2012/09/floating-a-us-biofuels-industry?cmpid=rss
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