A few days ago a biofuel refinery that will produce nearly 1 billion liters of biodiesel every year was announced as an expansion to the existing Co-Op refinery in Regina, Saskatchewan.
Generation 1 Biofuels are Bad For The Environment
By the year 2020 we thought biofuels had been largely dispensed with by both governments and industry as bad because:
- All current biodiesels are using food like corn as their input and converting food to fuel is a very bad idea
- To our knowledge all current biodiesel refineries only make economic sense with government subsidies and cannot stand on their own
- Older biodiesel is so unstable it cannot be pumped though a pipeline, which means the refineries must be located near major cities and then have their output trucked to gas stations. That means they will not acheive giant economies of scale that many “real” refineries have.
- Older biodiesel still has too much water and miscellaneous chemical residue which cause serious mechanical problems over the long haul.
Our understanding was that the biofuel industry was starting with foods like corn as away to advance their research and development into converting other biomass, in particular switch-grass, which humans have very little use for. The value in these naturally occurring tall grasses, relates to keeping the soil in place and holding moisture which are both very important and shouldn’t be understated.
It seemed like the biofuels industry had stalled it’s development of grass inputs, or had just failed outright. It looked like biofuels had become yet another trendy science that was either debunked or would be relegated to meaningful development sometime in the future.
Whats New With Biofuels?
Recently we became aware of the Clean Fuel Standard (CFS) which sounds great by its name but in fact can only be met by mixing biofuels with regular gasoline or diesel. And that is likely a primary driver behind the multibillion dollar expansion of the Regina refinery to produce massive amounts of biodiesel from canola.
These so called second generation biofuels are molecularly identical to there crude oil based competitors so that does clear up the issues with using pipelines and damaging engines. However it does nothing to address the problem of converting food into fuel.
The only logic we can see for making another product that is identical too crude oil based fuels is if we had a shortage or if it was substantially cheaper but that is absolutely not the case. This means that governments are pouring money into a needlessly expensive and complex technology that has no future.
If you don’t like combustion engines, then coming up with another carbon based fuel source to keep them running even longer makes even less sense.
Government Policy on Biofuels
We think the governments should stay out of the way of the private sector on most issues and that the role of government is to simply provide a level playing field of regulations for all to work in. Governments should be picking losers and the private sector should be picking the winners.
If society doesn’t like oil and gas they should increase their costs through things like gasoline taxes and carbon taxes but let the private sector figure out what the alternative solutions are and let citizens decide what their best alternatives are. We expect that gasoline will be replaced with battery electric, and diesel will be largely replaced with hydrogen. That means your passenger car is most likely best suited to batteries (BEV or PHEV) because they can charge up overnight, and big rigs and generators that need very fast refueling are best suited to hydrogen.
Whats New With Hydrogen?
Just to run off on a tangent for a moment here, you may have heard that hydrogen is a very bad product to produce as far as the environment is concerned. That was true up until 2021 because hydrogen production required vast amounts of electricity but not anymore.
There is a company in Calgary AB called Proton Technologies that has successfully proven but they can produce vast amounts of hydrogen in the ground from old oil reservoirs without adding any chemicals or any environmental costs. And the carbon that is produced in the process stays in the ground reservoirs where it has been for millions of years already. The best part is Proton’s hydrogen is about 90% less expensive than traditional and terrible electrolysis based hydrogen.
To be clear not all canola and corn is created equal and so there is a common sense place for biofuels that are made from very low grade farmed foods. However that is not what is envisioned by our governments for the future, and certainly not what we have today.
Generation 2 Biofuels Are Bad For The Environment
Did you know that about 1/3 of the entire United States corn crop now goes to biofuels and that corn is the largest crop in the United states. That is a lot of land. That is a lot of fuel for the tractors and cultivators. That is a lot of chemicals and pesticides. But most of all that is an outrageous amount of wasted food.
Biodiesel Is Not a Solution… It Is An Expensive Diversion
We don’t need more diesel or gas we have a virtually unlimited supply of that in places like the Texas Oklahoma Permian basin. What we need is new technologies that advance non carbon based transportation energy. That’s things like better chemical battery compositions, solid state batteries, hydrogen engine development and more shared vehicles.