Reducing lifecycle carbon emissions through biofuels today.
While there seems to be a focus of energy on this drive by a lot of stakeholders that the solution to carbon mitigation in transportation can only be via electrification, it is not the only solution. We are going to have a long period of time, perhaps decades, where we’re going to be driving combustion engines through burning liquid fuels, and biofuels have an opportunity to reduce the carbon intensity of a liquid fuel market.
A Bit of Biofuels History
Before there were any biofuel blending regulations, there was an oxygenate additive requirement by the EPA to help the fuel burn cleaner. Methyl tert-butyl ether (MTBE) was originally favored as it was already generated at the refinery and widely recognized since the 1980s. MTBE increases octane and oxygen levels in gasoline and reduces pollution emissions.
Unfortunately, groundwater and drinking water wells are highly susceptible to MTBE contamination. As a result, refiners switched to ethanol, or a C2H50H molecule, wherein the extra oxygen helps the fuel burn cleaner.
Further clean air advancements were created under the USEPA’s Renewable Fuel Standard (RFS). Biofuel blending began displacing their higher carbon intense gasoline and diesel fuel at an increasing rate. The lower carbon biofuels are required to reduce greenhouse gasses by 20% to 50%, as compared to conventional fuel counterparts. A secondary purpose of the RFS is to provide increased energy security in the U.S. through increased domestic fuel production.
Because the RFS defines eligible biofuels as being created through the conversion of biomass (typically agricultural crops such as soybeans and corn) to fuel, many saw this as depleting important global food supplies to create the fuel. While the “food vs fuel” debate has mostly been resolved, more attention is now given to reducing the lifecycle carbon intensity of biofuels in an increasingly competitive transportation market which includes electricity and hydrogen.
What about Ethanol?
The ethanol industry groups have done a much better job over the past three or four years of marketing themselves as being a low carbon option. After all, corn-based ethanol is 45% lower carbon intensity than gasoline. The problem is we’re only using it at 10% blend. So, we’re only able to displace 4 1/2% of the carbon in a gallon of gasoline. If you go to 15% ethanol, or E15, which is only currently available in about 3000 stations, you can increase that from 4 1/2% to 5.7% or 6.7%.
The question is, how much ethanol can we produce? We’re currently producing 16 billion gallons of ethanol a year. So, how much ethanol is too much? If we solve the CO2 problem of emissions in the process, are we creating another if we raise the ethanol percent? There is a concern about the volatility of fuel as it’s sitting in the underground storage tank, or being pumped into the car. That volatility, the off gases that come from the fuel can create smog and other issues. That is what is known as the Reid Vapor Pressure (RVP). That is why E10 is allowed in all vehicles today.
The conversation has shifted to one where ethanol can eventually be carbon neutral and perhaps even carbon negative through carbon capture, sequence duration, and different kinds of methods that can be introduced.
Why biofuels are part of the conversation.
We have to talk about biofuels. We have 270 million combustion engine vehicles on the road. They need a lower carbon fuel option. Biofuels is the best option right now. It does reduce the carbon in greenhouse gas emissions and does a much better job of it than ethanol, but with production of only 3 billion gallons of biodiesel year, an order of magnitude difference between the two.
It’s the only option until we come up with something new. There is the corn pathway and the soybean pathway, but there are other ways to make ethanol and biodiesel from other feedstocks. Vegetable oil is one example. They only require going through the process of approval, which is a laborious one and the process has to be certified to make it eligible for renewable fuel standard credits.
Renewable Diesel and California and Biodiesel CO2 Credits
Renewable diesel is one of the hottest additions to the biodiesel picture and gaining momentum. It gets a low carbon fuel standard credit in the form of a renewable identification number from the federal government. This gives the biodiesel blenders a tax credit, and it gets a carbon offset credit from California. Currently, California is the only state to provide a credit for low carbon fuel. That said, low carbon fuels are being transported to California from Indiana, Missouri, and Wisconsin, ironically increasing its carbon intensity to transport. So, realistically, it would have a better impact on the climate if we could get credit for where it was produced.
Right now, you can use electric powertrains for your 200-mile round trip parcel delivery services to come back to a central hub and charge overnight. Return to base fleets like UPS and FedEx and Amazon are doing this, which makes a lot of sense. However, there are applications where it does not make sense. For instance, in some cases, natural gas would be a better option. Environmentally, natural gas is still a fossil fuel. Not clean enough, although it’s significantly cleaner than diesel. And if it’s a renewable natural gas, it is infinitely cleaner.
We can hire engineers to look at other pathways that include the production process to enable the transportation of biofuels to a pipeline terminal for delivery. Ethanol producers could claim that by enabling carbon capture at their ethanol facility they could work that into their pathway assessment and get a better carbon score because it is not going out into the atmosphere. Unfortunately, that is not possible under the RFS. So, the only current solutions are California’s LCFS program or the USEPA RFS program.
The Biofuels Bottom Line
Biofuels have helped to significantly reduce CO2 emissions in the U.S. transportation sector and represent practical options for carbon emissions reduction today. Taken as a whole, the renewable fuel standard (RFS), blender’s tax credit (BTC), and LCFS programs cost about $22.6 billion in 2019, while total U.S. emissions reductions from ethanol, biodiesel, and RD were just over 90 MMT, which is equal to about a $251/metric ton of CO2e emissions reductions in 2019. While there are many other alternative fuel options, practicality, timeline, and costs should be considered when evaluating the best options to avert carbon emissions and their negative impact on the environment.
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