EIA sees US biofuels mandate failure
The US will fall short of the Renewable Fuels Standard, the government's Energy Information Administration (EIA) warns.
The country will only blend about 30 billion gallons of fuels like corn-based ethanol and advanced fuels into petrol by 2022, 17% short of the US mandate of 36 billion gallons by that year, the EIA forecasts.
‘The key risk factor is the rate of development of cellulosic biofuels technology,’ Howard Gruenspecht, EIA’s acting head, comments. ‘Near term growth of cellulosic ... is certainly a question mark.’
The US enacted the mandate late last year calling for corn ethanol, but also an increasing amount cellulosic ethanol made from fast-growing grasses and trees, and biodiesel made from non-food sources. Cellulosic is not yet made commercially.
Loopholes in the mandate that allow regulators to waive the requirements, if needed, could also result in lower blending, Gruenspecht says.
In August, US environmental regulators rejected a request from Texas Governor Rick Perry to halve the mandate, which he blamed for boosting corn prices and making it costly for farmers to feed livestock.
This year's oil price slide and the economic recession have damaged many biofuel companies financially and cut the amount of fuel some of them are making.
VeraSun Energy, the largest publicly traded ethanol company, filed for bankruptcy protection in late October.
This month, company lawyers said eight of VeraSun's 16 plants were ready to operate but are not currently producing ethanol.
Ethanol producers are also pushing for changes in blending regulations to allow more of the fuel to be blended into petrol that is burned in regular cars.
Currently rules limit petrol to 10% ethanol content, while specially made flex-fuel cars can burn E85.
The country will only blend about 30 billion gallons of fuels like corn-based ethanol and advanced fuels into petrol by 2022, 17% short of the US mandate of 36 billion gallons by that year, the EIA forecasts.
‘The key risk factor is the rate of development of cellulosic biofuels technology,’ Howard Gruenspecht, EIA’s acting head, comments. ‘Near term growth of cellulosic ... is certainly a question mark.’
The US enacted the mandate late last year calling for corn ethanol, but also an increasing amount cellulosic ethanol made from fast-growing grasses and trees, and biodiesel made from non-food sources. Cellulosic is not yet made commercially.
Loopholes in the mandate that allow regulators to waive the requirements, if needed, could also result in lower blending, Gruenspecht says.
In August, US environmental regulators rejected a request from Texas Governor Rick Perry to halve the mandate, which he blamed for boosting corn prices and making it costly for farmers to feed livestock.
This year's oil price slide and the economic recession have damaged many biofuel companies financially and cut the amount of fuel some of them are making.
VeraSun Energy, the largest publicly traded ethanol company, filed for bankruptcy protection in late October.
This month, company lawyers said eight of VeraSun's 16 plants were ready to operate but are not currently producing ethanol.
Ethanol producers are also pushing for changes in blending regulations to allow more of the fuel to be blended into petrol that is burned in regular cars.
Currently rules limit petrol to 10% ethanol content, while specially made flex-fuel cars can burn E85.
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