A new amendment to the National Defense Authorization Act was approved by the Senate last week that removed a provision approved by the Armed Services Committee that had blocked the military from being ordered to spend money to develop the domestic biofuel industry and to buy more expensive alternative fuels. Green business allies are applauding the move as the first hurdle. The House version of the Defense spending bill also has a biofuel prohibition.
By a 62-37 vote, the Senate struck down a section of the National Defense Authorization Act that would have kept the Defense Department from buying any alternative fuels that cost more than conventional fuels….
In 2011, at President’s Obama’s urging, the Energy, Agriculture and Navy departments entered into a memorandum of understanding to “assist the development and support of a sustainable commercial biofuels industry.” The objective, according to a Congressional Research Service report, is the “construction or retrofit of multiple domestic commercial or pre-commercial scale advanced drop-in biofuel plants and refineries.”
The cost of that three-year effort has been put at $510 million, with each department chipping in $170 million.
On March 30, 2011, President Obama directed the Secretaries of Agriculture, Energy and the Navy to “investigate how they can work together to speed the development of “drop-in” biofuels substitutes for diesel and jet fuel” as one part of a broader plan to develop and secure the United States’ energy resources and reduce greenhouse gas emissions. Three months later, Department of the Navy, the Department of Energy, and the Department of Agriculture issued a Memorandum of Understanding to, in part, “assist the development and support of a sustainable commercial biofuels industry.”
Within the first three months of the memo’s release, the Navy and USDA had announced their intent to purchase 450,000 gallons of drop-in biofuel from a blend of nonfood waste and algae. The USDA said it would be the single largest purchase of biofuels in government history. Plans were put into place to direct federal dollars to develop a pilot or commercial scale facility to produce military grade drop-in biofuel.
What made this memo of understanding unique, according to the Congressional Research Service report, The Navy Biofuel Initiative Under the Defense Production Act, was that it “focused solely on commercial-scale development of advanced biofuels and brings in the primary federal agencies involved in the advanced biofuel pathway.”
The Defense Production Act, it explained, had been amended to give the President an array of authorities to shape national defense preparedness and “maintain and enhance the domestic industrial base.” The policy declaration accompanying the DPA included domestic energy under its authority.
In an Executive Order #13603 on March 22, 2012, the term “energy” under DPA authority was defined as:
“all forms of energy including petroleum, gas (both natural and manufactured), electricity, solid fuels (including all forms of coal, coke, coal chemicals, coal liquefaction, and coal gasification), solar, wind, other types of renewable energy, atomic energy, and the production, conservation, use, control, and distribution (including pipelines) of all of these forms of energy.”
In other words, under the DPA’s declaration of policy, Congress has found that it is in the interest of national defense preparedness that the government assures that some level of capacity exists in the domestic industrial base to produce and provide both traditional and renewable energy sources, including from biomass sources.
Also in March of this year, the Advanced Drop-in Biofuel Production Project, under the DPA, was executed.
The stated goal of the project is establishing one or more complete value chains capable of producing the biofuels. This includes feedstock production, conversion and processing, blending, transportation, and logistics, as well as the design, retrofit, construction, operation, validation, and qualification of domestic, commercial-scale, integrated biorefineries. …[T] project would require domestically produced biofuel, … an acceptable feedstock source, suitability for military operational use, a biorefinery with a rated capacity of at least 10 million gallons of neat biofuel per year, and a commitment of at least 50% cost sharing.
Charles T. Drevna , President of the American Fuel & Petrochemical Manufacturers, called this week’s Senate vote an outrageous increase in military spending just as the country faces a fiscal crisis which itself could have severe impacts on economic stability and national security. Biofuels cost nearly eight times that of traditional fuels, he noted. He also questioned the provision mandating that the Navy build new biofuel refineries, saying the government shouldn’t be competing with the private sector which is capable of producing fuels and essential products in the most cost efficient manner. “The decision to invest in [bio] fuels,” he said, “should be based on sound economic judgment, and not political pandering that does nothing to advance national security.”
Under this Administration, developing the biofuel industry seems important for national security and energy independence, but oil shale not so much.