Biofuels – fuel from plant materials – may hold only vague meaning for many Americans. But they are an opportunity our nation cannot afford to pass up.
When mixed with the gas that powers our cars and trucks, biofuels saved drivers almost 90 cents per gallon at the pump last year.
Moving forward, new sources of renewable energy could be game-changers: reducing the influence that foreign nations have in setting our fuel prices, and creating hundreds of thousands of good-paying jobs, particularly in our rural communities.
This week USDA is helping to advance that agenda, making an investment of more than $130 million to fund research and development into biofuels by universities and private firms – with a focus on aviation fuel.
This year, passenger and cargo airlines in America will spend about $50 billion on fuel. And airlines are looking for reliable, affordably-priced alternatives. If just a fraction of those billions are spent on ‘Made in America’ renewable fuels, we can help create jobs here at home and decrease our dependence on foreign oil.
That’s why I went to the Seattle Airport this week to visit with partners who are working to squeeze the energy from locally grown trees to power our planes. And its why, last month, USDA announced a partnership with the Department of Energy and the U.S. Navy to help develop an aviation-biofuels economy that fuels our military planes and strengthens our national security.
Because when we help every region of the country produce biofuels, it means good jobs for Americans. Construction workers must build the production facilities. Trained employees will operate them. And local farmers or forest-owners will be paid for the feedstocks needed to produce the fuel.
And this week’s announcement is just one small piece in USDA’s larger effort to build a nationwide biofuels industry. We’re helping communities and companies invest to build biorefineries that will dot the rural landscape. We’re supporting the farmers, ranchers, and businesses taking risks to pursue new opportunities in biofuels. And we’re helping establish the infrastructure to put renewable fuel in America’s gas tanks.
When President Obama outlined his vision for a new energy future for the nation, he challenged us to cut our imports of foreign oil by one third by 2025. In the years to come, biofuels have the potential to replace foreign oil and power our cars, trucks, and planes. And building a nationwide biofuels industry will drive economic growth and create jobs across the country.
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It is misleading to say that ethanol has saved Americans money at the pump. Corn-based ethanol (the vast majority of ethanol in the U.S. is derived from corn) is not cost-effective when compared to conventional fuels such as gasoline. The price that people pay at the pump for ethanol is not the entirety of what they are paying. One reason for this is because corn is a heavily subsidized commodity. Between 1995 and 2005 the total for federal corn subsidies reached $51.3 billion. In 2005 corn subsidies reached $9.4 billion. The International Institute for Sustainable Development claims that in 2006 the total subsidies for ethanol ranged from $1.05 per gallon to $1.38 per gallon and that the 35 billion gallon ethanol fuel target would require $118 billion more in subsidies. In 2010, the Congressional Budget Office concluded that displacing one gallon of gasoline with corn-based ethanol cost taxpayers $1.78.
Additionally, if the U.S. wants to have a significant percentage of its transportation fuel to come from biofuels, it will have to move beyond corn-based ethanol. In order to produce enough corn-based ethanol to meet the demand for conventional transportation fuels, essentially all U.S. farmland would have to be fully devoted to corn crops. If this corn monoculture occurred, the U.S. would be extremely susceptible to a boom-and-bust cycle, meaning that if the corn crop was hit hard by unfavorable weather or a multitude of other possible problems, the U.S. would not have enough fuel or food to provide its citizens.