Biofuel Could Replace Oil
The Government's $510 Million Initiative
On Tuesday, the Obama administration announced an initiative to further the production of biofuels and to incorporate them into mainstream fuel consumption.
Made possible by donations of $170 million each from the Navy, the Department of Energy, and the Department of Agriculture, $510 million will be set aside for biofuel projects over the next three years.
The money will go to companies that can match the government grants.
It is designated specifically for the research and production of biofuels from cellulosic biomass, wood chips or agricultural crop parts that are not used as food, says Reuters.
The goal of this is to develop fuel from feedstocks other than corn or edible agriculture, as fuels based in corn, like ethanol, have driven up the price of corn and corn-based foods.
Each department will remain actively involved in the projects, Politico reports. The Navy will help provide a market for biofuels, using the fuel for marine purposes. The fuel will also serve in aviation.
The Department of Agriculture will see to it that food is not being affected in the manufacturing of the biofuels.
The Department of Energy will help provide the necessary technology for fuel production.
Secretary of Agriculture Tom Vilsack commented on the decision of the three departments and the administration, as reported by Reuters:
“The President understands that for us to be more competitive economically and for us to be more secure, we need a diversification in our energy choices rather than continuing to blindly support oil producing monopolies.”
Biofuel production from projects funded by this initiative will go to the President’s goal of a reduction of oil imports by one-third by 2025, as well as to the Navy’s goal of fossil fuel reduction by ½ by 2020.
Recently, Virent Energy Systems and Amyris Inc (NASDAQ: AMRS) were chosen to move ahead in a National Advanced Biofuels Consortium program, which is aimed at finding an efficient method for creating biofuel from cellulosic biomass.
Rentech Inc (AMEX: RTK) is a biofuel production company that also specializes in using cellulosic biomass feedstocks.
These companies will be the ones to keep an eye on as companies rally to be a part of this government initiative.
That’s all for now,
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