What the RAND Report on Biofuels Really Said
The just-issued RAND report Alternative Fuels for Military Applications has generated quite a bit of controversy. However, in my opinion many of the news stories covering the report got the gist of the message wrong. In essence, what has been reported is “RAND Says Biofuels are Bunk.” In fact, many in the renewable energy industry have responded as if they are under attack. Biofuels Digest published comments from several in the renewable fuels industry. Some excerpts from those comments:
Will Thurmond, CEO, Emerging Markets Online
Is it simply a coincidence that RAND’s study on alternative fuels for the military, the “Clean Coal” Coalition’s advertising campaign, and the State of the Union address were released on the same day? In contrast to greenwashing by some big electric cos, this is brown-washing by friends of coal by proxy via one RAND oil and coal consultant who says CTL or Coal To Liquids via Fischer-Tropsch gasification technology, is a better solution than biofuels.
John Plaza, CEO, Imperium Renewables
As one of the leading companies in the development of Renewable Jet fuel from biomass, Imperium Renewables is extremely disappointed by the research report released today by the RAND Corporation.
Advanced Biofuels Association President Michael McAdams
“Shame on the RAND Corporation as it does a great disservice to itself and our nation by wrongly criticizing the Department of Defense and its investment in advanced biofuels and deployment of a Great Green Fleet. The RAND study clearly embraces the failed energy policies of the past. The technologies and benefits of advanced biofuels are real.
The Algal Biomass Organization
The positioning of the entire US algae industry as a “research topic” is frankly both demeaning and patently false. We have more than 100 companies, academic institutions and national laboratories working to develop the algae-to-fuels industry. Algae-derived fuels have already been tested and/or used in motor vehicles and commercial aircraft, and last fall’s successful test of a Navy Riverine Command boat showed that algae fuels are ready for use. It is unclear to us whether or not any actual “green” CTL fuels have been produced or tested.
I believe these comments, as well as many of the media reports on the study, have missed the point. The key point of the study is that biofuels don’t necessarily offer the military any tactical advantage, which may very well be true. Further, the report raises questions of whether the military can count on the commercial availability of some of the fuels that are being tested. Posturing by vested interests aside, this is a legitimate question.
The report also points out that per the Defense Production Act of 1950, the Defense Department and its contractors have “preferential access to contracts for the production, refining, and delivery of petroleum products.” In other words, if there are petroleum shortages, the U.S. military is near the front of the line for receiving what they need. In that case, the report implies that the military won’t need biofuels in the foreseeable future so there is no reason for them to take the lead on this.
Below are some other highlights from the report. Following each, I offer my thoughts.
Fischer-Tropsch fuels are the most promising near-term options for meeting the Department of Defense’s needs cleanly and affordably.
The reason for this conclusion is pretty straightforward. There are commercial GTL and CTL plants operating today, from Shell’s 15,000 barrel per day Bintulu GTL plant to Sasol’s 140,000 barrel per day Secunda facility. To my knowledge there isn’t even a 100 barrel per day facility that produces fuel from algae. So the concerns highlighted in the report over algal fuels are more around the possibility that technical problems aren’t resolved, and algal fuels are ultimately not cost effective. The report viewed algal fuel as more of a long-term prospect. However, even in the case of Fischer-Tropsch fuels, the report still indicated that there wouldn’t necessarily be a tactical advantage; it is just that FT fuels are the option most likely to deliver scalable volumes of fuel.
It is highly uncertain whether appreciable amounts of hydrotreated renewable oils can be affordably and cleanly produced within the United States or abroad.
I would say that this is probably accurate in the U.S., but as I noted following my trip to Malaysia, renewable fuel from palm oil can be produced cheaply — with duly noted environmental consequences.
Concepts for forward-based alternative fuel production do not offer a military advantage.
One of the images Tom Hicks invoked when I interviewed him was the vulnerability of long fuel convoys headed into the theater of operations. But the RAND report suggests that local production facilities and feedstocks would also be vulnerable to attack. In the former case, fuel can be produced far from the battlefield and must then be protected during transit. For locally produced fuels, the facilities and feedstocks would need to be protected, and that may not offer any advantages.
Defense Department goals for alternative fuels in tactical weapon systems should be based on potential national benefits, since the use of alternative, rather than petroleum-derived, fuels offers no direct military benefits.
I think this was the key point of the report — not that biofuels don’t deliver but that the military really doesn’t need them.
Current efforts by the services to test and certify alternative fuels are far outpacing commercial development.
I agree, but I don’t view this as a problem. In many cases commercial development would hinge on whether the fuels will actually work for the military, and thus the testing would be expected to lead commercial development.
Within the United States, the prospects for commercial production of alternative fuels that have military applications remain highly uncertain, especially over the next decade.
I think that is a factual statement. People may disagree over how uncertain it is, but nobody can promise a slam dunk here.
Ethanol and biodiesel are unsuitable for use in weapon systems. They pose a severe safety risk, reduce performance, unduly complicate fuel delivery and storage, and generate maintenance problems.
I saw some mentions in the press that the report viewed ethanol and biodiesel negatively. But look at the context. The report notes that existing military power systems are designed for jet fuel or diesel, and thus ethanol is unsuitable. The report also notes that if the engines could be redesigned, ethanol’s propensity to absorb water could be an issue. So again, I don’t think the report is slamming ethanol, it is just saying that it is unsuitable for those specific military applications.
In conclusion, I don’t view the report as the negative slam on renewable fuels that has been portrayed, and I don’t think the renewable fuel industry needs to get overly defensive as a result. The people who have legitimate reasons to be defensive over the report are those who have been behind the push for renewable fuels in the military.
2015 EIA Energy Conference
June 15-16, 2015 - Washington, D.C.
Platts North American Crude Oil Summit
February 26-27, 2015 - Houston, TX