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4-26-06

ISU's Robert C. Brown to Senate committee: The bioeconomy is bigger than biofuels

This is the testimony presented by Robert C. Brown, Iowa State's Bergles Professor in Thermal Science and director of Iowa State's Office of Biorenewables Programs, to the U.S. Senate Committee on Agriculture, Nutrition and Forestry. Brown addressed an April 26 hearing on the state of the biofuels industry.

Mr. Chairman, thank you for this opportunity to testify on the future of the renewable fuels industry.

The Chicago Board of Trade recently reported that "the U.S. ethanol industry is experiencing exponential growth and this trend is expected to continue." In other words, the sky's the limit.

Robert C. Brown

Robert C. Brown said the most optimistic forecasts call for grain ethanol to replace up to 8 percent of gasoline demand. Photo by Jim Heemstra

If this sounds like the heady days of the 1990's Internet boom, there are indeed parallels. The Washington Post notes that both the Internet and the renewable fuels industry started from relatively small bases, they are dependent upon technological innovation for growth, and both were underinvested relative to the size of the potential market. This parallel has not been lost on the original investors of the Internet who are among the largest investors in the renewable fuels industry today. With a growth rate averaging 22 percent in the last four years and a doubling expected in the next five years, it is hard not to be excited. However, we must realize that decisions made today will determine whether this industry meets expectations or whether it falls victim to irrational exuberance.

The Department of Energy calls for renewable fuels to meet 20 percent of U.S. transportation demand by 2030. Currently, ethanol represents only 3 percent of transportation fuels but even the most optimistic scenarios do not predict grain ethanol to displace more than 6-8 percent of gasoline demand. Agriculture must think beyond corn and soybean production if it is to supply a significant fraction of U.S. transportation fuels.

Corn, soybeans or switchgrass?

At Iowa State University I teach students about biorenewable resources in one of the only such graduate programs in the United States. As a class exercise I ask my students, given the choice of growing an acre of corn, soybeans, or switchgrass, which would yield the most transportation fuel and which would produce the greatest quantity of dietary protein. Most students choose corn for fuel and soybeans for protein. They are surprised to learn that an acre of switchgrass could yield almost twice the biofuel as an acre of corn and almost the same amount of protein as an acre of soybeans. Much work remains to make this intriguing possibility a reality. Success would allow renewable fuels to meet 30 percent or more of our nation's transportation needs, according to a recent USDA study.

The bioeconomy

The emergence of the renewable fuels industry is only part of a bigger movement known as the bioeconomy. The Des Moines Register recently characterized this movement "a revolution;" indeed, proponents of a bioeconomy call for nothing less than the complete replacement of petroleum with plant-based chemicals and materials in the manufacture of not only transportation fuels, but building materials, fabrics, lubricants, plastics, and other durable and consumable goods.

We must be careful in our delineation of goals for the bioeconomy. Often people confuse pathways with goals. For example, converting corn into ethanol is not a goal of the bioeconomy but rather a pathway, and possibly a transitory one at that, as new technologies present more efficient and high yielding pathways. I suggest four goals for the bioeconomy:

  • The first goal is to reduce reliance on imported petroleum. If we discover after a decade of "exponential growth" in the renewable fuels industry that we still import more than 60 percent of our transportation fuels, then the bioeconomy is not fulfilling its promise.
  • The second goal is to improve environmental quality, especially reducing emissions of greenhouse gases into the atmosphere. In principle, the manufacture of biofuels yields no net emissions of greenhouse gases, while innovations in agriculture can substantially sequester carbon into soils. In practice, these advantages are diminished by over reliance on fossil fuels in the production of biofuels and failure to employ sustainable agricultural practices. We must be diligent about keeping the "renewable" in renewable fuels.
  • The third goal is to expand markets for U.S. agriculture products. Although these products might be traditional cash crops, they might also be new commodity crops that better meet the needs of a bioeconomy.
  • The fourth goal is to provide economic development opportunities for rural America. Outsourcing by U.S. corporations is often justified as "following the resource." In the bioeconomy, the resources are the rich agricultural lands of rural America. We can expect the manufacture of biofuels and biobased products to occur in communities close to this resource, which will boost our rural economies.

Expanded research

The way to a bioeconomy is not clear even with a well defined set of goals. It is too early to pick winners and losers among the technologies that can transform biomass into biofuels and biobased products. I think you would be surprised and astonished at the wide array of technologies that are being explored as pathways to the bioeconomy. Much of the recent public discussion has been about the development of advanced enzymes to produce cellulosic ethanol, but other possibilities include Fisher-Tropsch liquids or alcohols from syngas, co-refining bio-oils and petroleum crude, and hydrogen generation from algae, to name a few. Expanded research both applied and fundamental in nature, is the best way for government to help industry distinguish the winners for commercialization.

Thank you for your time this morning. I would be happy to answer any questions you have for me.

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Quick look

Iowa State's Robert C. Brown suggested four goals for the country's bioeconomy:

  • Reduce America's reliance on imported oil.
  • Improve environmental quality.
  • Expand the markets for U.S. agricultural products.
  • Improve the economy of rural America.

Quote

"Agriculture must think beyond corn and soybean production if it is to supply a significant fraction of U.S. transportation fuels."

Robert C. Brown, Iowa State's Bergles Professor in Thermal Science and director of Iowa State's Office of Biorenewables Programs