Note: Low (green) and high (purple) ranges were developed using highest cost/ lowest GHG reduction estimate, and lowest cost/ highest GHG reduction estimate for each option, then taking the 25% and 75% percentile of this range to represent the low and high estimates in this figure. In some cases, ranges were developed around point estimates to reflect uncertainty.
Replacing a portion of petroleum fuel with a biofuel generally brings a reduction in vehicle emissions of sulfur, particulates, and carbon monoxide. However, particularly in engines poorly calibrated to run on biofuels, nitrogen oxide (NOx) emissions can increase, and in low-level blends with gasoline, ethanol can cause increased emissions of volatile organic compounds. Increasingly stringent standards for petroleum-based fuels will tend to reduce the emissions advantages offered by conventional biofuels, but the next generation of biofuels, including Fischer-Tropsch diesel and di-methyl ether (DME), can be tailored to meet certain emission specifications. Particularly in developing countries, ethanol and biodiesel could play a significant role in improving urban air quality and helping to phase out lead-based and otherwise toxic fuel additives.
Biofuel production offers similar risks and opportunities with regard to the health of the world’s ecosystems. Expanding the cultivation of biofuel crops has the potential to contribute to soil depletion and erosion, habitat loss, and reduced biodiversity. On the other hand, cellulosic biofuels could be produced from perennial grasses and trees that protect lands vulnerable to erosion and restore lands degraded by overuse. By diversifying monoculture ecosystems, such crops could also serve to increase local biodiversity. For these benefits to be realized, the expansion of biofuel production will need to be accompanied by a new generation of clear and strict land- use laws, particularly in countries with tropical forests that are at risk of destruction.
In general, any plan to promote the production and use of biofuels on a large scale must be part of a broader strategy to reduce total energy use in the transport sector. In addition to ending subsidies for conventional fuels (and for unconventional petroleum fuels), governments must encourage the development of lighter, more fuel-efficient vehicles, and promote and support smarter urban design and mass transit.
Market Introduction and Technology Strategies
The current trend toward larger-scale biofuel conversion facilities is likely to continue in the coming years. Future facilities for converting lignocellulosic feedstock into biofuels are expected to be even larger than facilities now used for the production of first-generation biofuels, and significant economy-of-scale advantages are expected to reduce the cost of production. However, the relatively dispersed nature of agricultural crops and the high cost of transporting solid biomass will put upper limits on the future scale of biofuel plants.