PEW Charitable Trusts this week launched a new study, From Barracks to the Battlefield: Clean Energy Innovation and America’s Armed Forces, that details how energy innovation and clean energy can help U.S. Armed Forces respond to energy challenges and in turn how DoD’s commitment to energy transformation can contribute to development of new energy technologies that will benefit American consumers and commercial interests alike.
The major energy challenges the DOD faces include risks associated with transporting liquid fuels to the battlefield; growing oil price volatility; the impact of fuel dependence on operational effectiveness; and the fragility of energy supplies for forces.
The department is not immune from oil price spikes and resulting budgetary challenges. In fiscal 2005, DoD spent $8.8 billion for 130 million barrels of petroleum supplies. In fiscal 2008, 134 million barrels cost the department $17.9 billion, more than double the cost for almost the same amount of fuel purchased in 2005. More recently, the price paid for gasoline by the Air Force increased in mid-2011 by $1 per gallon. Carried forward over the course of the year, this price increase could raise Air Force energy costs by $2.3 billion. Across the department, operational energy costs increased from 2009 to 2010 by more than 19 percent, even though energy consumption declined by more than 9 percent.
“Moreover, where military operations are concerned, the pump price of gasoline does not fully account for all of the costs associated with securing, shipping and protecting fuel. Thousands of troops are put at risk, some sacrificing their lives, so that fuel can be obtained and delivered to the battlefield. These and material costs are increasingly factored into long-term military planning, and the department is exploring ways to consider what is known as the Fully Burdened Cost of Energy (FBCE), which is estimated to be as high as $40 per gallon.”
The report concludes that alternative fuels and renewable energy sources can be domestically produced (and locally sourced around the world) to enhance the security of energy supplies. Further, just as DOD technology development efforts have supported commercial development of computers, the Internet, the Global Positioning System, semiconductors and many more innovations, DOD’s role as an early adopter could help create a larger industry. The military has a broad range of strengths that can help accelerate commercial maturity for advanced biofuels, including an established research and development infrastructure, ability to grow demonstration projects to scale, significant purchasing power and the culture and management infrastructure necessary to foster innovation.
The Navy, the USDA and the Department of Energy recently requested information from the biofuels industry on the capability of biorefinieries to produce drop-in biofuels competitively priced to petroleum and the ability to meet the geographic diversity required by the military.
BIO’s response to the information request noted that many advanced biofuel producers have achieved milestones toward commercial development of a diverse array of feedstock and technology combinations. Some advanced biofuel companies already have worked with the DOD or with commercial airlines to test and certify advanced biofuel/petroleum blends, and more are poised to do so. The full range of projects located in diverse areas of the country, combining local feedstocks with tailored technology and processes, represent a robust response to the challenges, particularly for military biofuel needs.
Though the U.S. military represents only 2 percent of the U.S. fuel market, it possesses sufficient purchasing power to drive development of new advanced biofuels in sufficient quantities at the right price. By playing the role of an early customer and partner, the DOD can speed commercialization of advanced biofuels that can grow to meet commercial consumer market needs. The USDA and DOE can help to overcome upstream feedstock and technology development challenges by coordinating their support.
This type of coordinated approach to helping commercialize biofuels was the vision behind the Energy Independence and Security Act of 2007 (EISA). Though the programs put forward in that bill took years to implement, due to lengthy rulemaking processes, they are finally producing initial results. Today, four years later, a number of biorefineries have reached demonstration and pilot scales, and many developers are raising capital to build new commercial-scale facilities. BIO has tracked the development of more than 65 pilot, demonstration and commercial projects for advanced, cellulosic and algae biofuels across the United States and in Canada. Biotechnology companies have developed the technology to produce a range of chemical molecules – including butanol and other higher alcohols, ketones and aromatics, diesels and oils – that can be used as drop-in fuel, fuel additives, or upgraded to military specifications for fuel.