Is a Domestic Biofuel Industry Necessary for National Defense?

Erick CastroScott Bishop

Brad ColemanGary BlumbergAnthony Ripley

Biofuels Background

• Biofuels = fuels from recently processed biomass– Biomass (organic matter) referred to as feedstock

• Two primary types of biofuel: ethanol, biodiesel• 1st Generation biofuel: carbohydrate-based• 2nd Generation biofuel: cellulose-based• 3rd Generation biofuel: microalgae/organisms

Congressional RFS mandate

15 Billion

4 Billion

16 Billion

New growth industries

Proponents• Independence from foreign

oil sources– Drop-in replacement for oil– Reduce price of oil

• Cost projected to drop below current price of fuel

• Claims lower lifecycle carbon footprint

• Hedge against volatile fuel prices

• DOD should initiate investment

Detractors• Insignificant impact on fuel

supply• Currently more expensive• Env. benefits in doubt

– May increase CO2 levels– May consume more energy to

produce than energy provided

• As a direct substitute, biofuel would be priced at market rate

• No increase in military capability– Same logistics as oil

Biofuel Proponents/ Detractors

Biofuels won’t remove volatility

DOD Energy Use by Service

• DOD is the largest consumer of petroleum in the world– DOD should lead biofuel research

• USAF: 62M• USN: 25.3M• USA: 21M• USMC: 4.7M• Total: 113M*

*2010 consumption

Air Force Navy Army Marine Corps

0

10

20

30

40

50

60

70

FY 2010 Petroleum Fuel Use (Millions of Barrels)

U.S. Petroleum Use• DOD accounted for 1% of all U.S. energy consumption• DOD accounted for 3.2% of U.S. petroleum use in FY2011• DOD accounted for 0.69% of world petro use in FY2011

USAF USN USA USMC U.S. Comm.

Aviation

U.S. Trucks & Buses

U.S. Light Vechicles

0

500

1000

1500

2000

2500

3000

3500

4000FY2010 Petroleum Fuel Use (Millions of Barrels)

Proportional Costs of Biofuel

• Department of the Navy has committed to spend over $200M to start a domestic biofuels industry

OR• Fund an additional 1,300 sailors.• FY13 shipbuilding plan Joint High-Speed Vessel

cost $189M

• R&D for energy saving technology

Opportunity Costs of Biofuel

• Paying more for biofuels reduces funds available for innovations which give the DOD an operational advantage and reduce dependence– Current innovations which provide a tactical

advantage and reduce fuel consumption: • Solar power tactical equipment• Low consumption electronics• Higher capacity batteries• Insulated tactical shelters (tents)

• Convoys are composed primarily of:– USMC: fuel & water are 70% logistic demand– Army: fuel & water are 80% logistic demand

• Costs to protect convoy:– Manpower diverted from tactical operations

• 50:1 casualty rate• Decreased lethality• Decreased endurance

Petroleum: Logistical Vulnerability

• Fuel saving technologies:– Ground Renewable Expeditionary Energy Network System (

GREENS)– Solar Portable Alternative Comm Energy System (SPACES)– Rucksack Enhanced Portable Power System (REPPS)– Tactical Water Purification System (TWPS)– Lightweight Water Purification System (LWPS)– Hybrid solar-battery-generator– DC air conditioners

• These examples reduce the logistical demand and provide an operational advantage.

• These are some of the opportunity costs for investing in drop-in replaceable fuels.

Alternative technologies

Biofuels do NOT reduce the logistical vulnerability

• DPA Examples of Success– Micro chip– Nuclear Power– GPS– Secure Radio Tech.

• Common Beneficial Trait– Each provided a substantial

operational advantage or capability to DOD

– Nothing available to provide comparable results

• DOD Procurement Failures– $436 Hammer– $640 Toilet Seat– $7,600 Coffee Maker

• Common Detracting Trait– None provided a

substantial operational advantage to DOD

– Adequate* substitutes readily available

*Adequacy infers that COTS items are “good enough” to accomplish the intended task.

DOD and Defense Production Act

Conclusion and Recommendations

• Conclusion– Biofuels do not reduce the logistical vulnerability– Does not provide added value• Higher performance• Operational advantage

• Recommendation– Divert funds to develop technologies which reduce

fuel and water demand on the battlefield– If biofuels are a congressional priority fund as R&D– Mandate policy to hedge against volatility

Questions?

I pity the fool who is insecure

“MR. T”

DR.

Domestic Petroleum Sources

• IEA World Energy Outlook projects(2012 edition)– US becomes a net exporter of natural gas by 2020– Almost self-sufficient in net energy by 2035.

• Energy independence met with no fed gov exp

Petroleum Use: The Bigger Picture

Air Force

Army

Mari

ne Corps

Navy

U.S. Li

ght V

echicl

es

U.S. Tru

cks &

Buses

U.S. Commerci

al Avia

tion0

50010001500200025003000350040004500

FY2010 Petroleum Fuel Use (Millions of Barrels)

U.S. Transportation data from Department of Transportation Bureau of Transportation Statistics

GREENS

REPPS & SPACESREPPS

SPACES

TWPS/LWPSTWPS

LWPS

Hybrid Power / DC Airconditioners

Making Ethanol (Corn)

Dry Milling Process

Source:http://www.ethanolrfa.org/pages/how-ethanol-is-made

Making Ethanol (Corn)

Wet Milling Process

Source:http://www.ethanolrfa.org/pages/how-ethanol-is-made

Making Ethanol (Cellulose)

Source: http://www.csa.com/discoveryguides/biofuel/review6.php

Making Biodiesel

Source: http://biodieseltutorial.utahbiodieselsupply.com/howitsmade/

Making Biofuel (Algae)

Source: http://chemengineeringposts.wordpress.com/2012/02/20/what-about-algae-2/

Fischer-Tropsch Process

Source: RAND Report “Alternative Fuels for Military Applications”

Hydrotreated Renewable Oils

Source: RAND Report “Alternative Fuels for Military Applications”