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Sunday, November 22, 
2:47 am

Biofuel backlash more than meets the eye

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mascoma.gifWhen Mascoma Corp. announced $61 million in new venture funding last week, the biofuel company specifically touted the fact that its pursuit of cellulosic ethanol is aimed at non-food crops, with a nod to the growing backlash against biofuels as a factor in rising food costs.

Never mind the fact that one of Mascoma's chief backers is Khosla Ventures, which is also a big backer of biofuel companies whose models rely on the use of corn and soybeans as feedstock -- it was just too easy to take the cheap shot. But Vinod Khosla, in an early volley in what will soon become a backlash to the backlash, argued in an interview published in Sunday's San Francisco Chronicle that the notion of biofuels driving food prices up is way overblown, adding that "there are massive PR campaigns trying to ascribe most of the blame to biofuels."

First of all, corn ethanol is nicknamed "Monsanto Moonshine" because it is mostly produced from corn grown using genetically modified seed produced by Monsanto Corp., and this corn historically has been used almost exclusively for animal feed and processed foods. Sure it is part of the whole chain that determines the price of food humans eat, in the sense that it eventually becomes meat or corn syrup-based soda pop etc., but it is hardly taking ears of corn off the table of consumers.

It is much more relevant to point out, as Khosla does, that the dominant factor in rising food prices is the cost of oil.

Supporters of corn-based ethanol companies have to be diplomatic, but the most important long-term fact about growth in the industry is that it is feeding biofuels into the market immediately, using an established market and distribution system, and thereby supporting what will eventually be a biofuel industry with multiple feedstocks and outputs. Corn-based ethanol may or may not be sustainable in the long run. But the fact that it is able to serve a market end-to-end immediately is a huge opening for a biofuels market that ultimately will deliver products ranging from biodiesel to potentially extremely high-quality butanol or other molecules that could be used in aircraft fuel or other specialized applications and that take advantage of a variety of feedstocks ranging from switchgrass to algae to various waste products.

But with Khosla boldly projecting $35 a barrel oil by 2030, it's easy to see why there are constituencies that have a stake in heightening the current backlash, and attempts to sow public outcry against corn-ethanol or biodiesel from soybeans could be nothing more than a transparent attempt to kill the infant biofuel industry in the cradle. -- Clifford Carlsen

See May 11 story from theSan Francisco Chronicle
See May 6 story from TechConfidential
See May 6 press release from Mascoma Corp
See January 16 story from TechConfidential

 

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