Rising fuel prices spur biofuels

Converting plant materials, Bowyer said, uses less fossil fuel energy than some other biofuel food stocks like corn or soybeans because these crops require fertilizers, pesticides and annual harvesting.

The Associated Press

5/5/2008

STARKVILLE, Miss. — The ominous drumbeat of rising energy prices is becoming more like a clarion for more forms of energy, opening up increases in biofuels, a trend not expected to diminish, say forest industry insiders.

"It looks like we are on the brink of a threefold increase in biofuels, just in the next decade," said Jim Bowyer, president of Bowyer and Associates Inc., a wood science and bioenergy consulting firm.

Bowyer said the increases in the U.S. production would likely be even greater.

It's no secret that as developing countries become more industrialized and energy demands increase, the rising cost of petroleum will spur research and development of fuels less tied to a barrel of oil. Already, ethanol production in the U.S. is increasing by tens of thousands of barrels a day, said Bowyer.

"I don't think it's too much of a mystery as to why energy costs are going up," said Bowyer.

He said China's current oil imports at 3.7 million barrels a year, and by 2030, the figure is expected to be 10.9 million barrels.

"Any nation or company that isn't prepared for what's coming is in for a world of hurt," said Bowyer. "And I would say that the United States is unprepared."

Bubba Comer, of CFC Transportation Inc., a Columbus trucking company, has been making biodiesel for about two years. Though the organic-based fuel derived from feed stocks like soy, poultry and other materials, has cut his fuel cost by 10 to 20 cents a gallon, the rising of cost of petroleum is also raising the costs of those feed stocks.

"The feed stocks just keep getting higher. With oil going so high the feed stocks are indexed to follow it," said Comer.

He said the trucking industry has become a cost prohibitive business, and he said he couldn't imagine anyone going into the industry today.

"When I started off 16 years ago, diesel was 68 cents a gallon. Now I'm paying, I think around $3.87 for fuel.

"I just don't know where this fuel situation is going," said Comer, who added the biofuels he's using — today he's mixing poultry grease — have worked well for his company.

"It's worked really well for us," said Comer.

Comer sells the excess biodiesel to other truckers.

With fuel prices escalating so rapidly, Bowyer supports more research and development into cellulosic wood technology, where pulp wood and other plant materials are used to make biofuels, which could add to the availability of feed stocks that Comer noted are following the price of oil.

"Instead of petroleum coming to a refinery, it will be trees," said Bowyer, who envisions standard paper mills being reconfigured for producing not just reams of paper, but barrels of biofuel, derived from trees.

And maybe it's likewise no surprise that forest plantations are also on the rise, particularly in Asia, where China holds 71 percent of the plantations. And in the United States, where much of the logging is done on federal lands, debate is still continuing around how to harvest trees to be used for cellulosic energy.

"Forest Service lands were taken off the table," said Bowyer. "And there's attempts right now to put that language back in."

Bowyer said harvesting should not be taken off of federal lands.

"It would be the worst thing that could happen for everybody," said Bowyer, a past president of the International Forest Products Society and Society of Wood Science and Technology.

Many have complained about the increase in ethanol production driving up the cost of corn and the food animals that eat it, and some have wondered if the cost of wood products will also rise once trees become a source of energy.

Not so fast, said Bowyer.

"The value of lumber is always going to be more than whatever energy you can derive from it," he added. "But it could potentially affect the cost of things like pulp wood, so you could see the price of paper go up."

The rapid march to biofuels has its skeptics.

"I'm old enough to remember the oil crisis of the early '70s and how that generated a lot of talk around different forms of energy," said retired MSU forestry professor Bob Daniels, who calls himself "somewhat of a skeptic," when it comes to a wholesale switch to new forms of energy.

"We used to build houses out of wood, and we still do. But we now use a range of materials, and I think with this whole energy thing, that's what's going to happen," said Daniels, who admits demand for energy is increasing, but a complete shift into all new sources of fuel will be incremental.

"It's pretty clear to me," said Bowyer, "that the biofuels genie is out of the bottle."