DOE Secretary Chu Breaks With Obama Over Energy Policy

Jim Lane Biofuels Digest - October 13, 2009 In Washington, the U.S. Secretary of Energy, Dr.

Jim Lane Biofuels Digest — October 13, 2009

In Washington, the U.S. Secretary of Energy, Dr. Steven Chu, broke with Obama administration renewable energy policy, telling stunned alternative energy developers at a recent meeting on alternative fuels that “if it were up to me, I would put every cent into electric cars.”

The Department of Energy has closed $1 billion this year in loan guarantees for all-electric luxury sports cars while releasing less than $20,000 as of last month in ARRA funds for biofuels, according to previous reports in the Digest.

Meanwhile, the global aviation industry, which has set a target of 3 billion gallons of aviation biofuels by 2020, has begun an historic shift in focus to Chinese leadership in biofuels capacity development, with Air New Zealand CEO Rob Fyfe traveling to Hong Kong to blast global leaders for investing “enormous resources the world over in debating climate change regulatory frameworks and yet failing to take even the most basic steps to actually reduce emissions.

In related news, Boeing confirmed that it has commenced talks with the Chinese Academy of Sciences and “several Chinese universities” about a potential development of low-carbon aviation biofuels. CCTV is reporting that near-term opportunities for collaboration between Boeing and China’s alternative energy industry could focus on jatropha development in Yunnan, Sichuan and Guizhou provinces and the Guangxi Zhuang autonomous region. According to Xinhua News Agency, China is projecting “13 million hectares of biofuel plantations by 2020,” primarily to meet increased internal energy needs.

A meeting of leading biofuels scientists in Beijing this fall will provide advice to Chinese ministries preparing for an upcoming state visit by U.S. President Barack Obama, with energy issues reported to be high on the agenda for the summit meeting. The U.S. President, whose official policy calls for strong investments in solar, wind, and biomass as well as electric car infrastructure, and whose administration is the largest shareholder in the largest U.S. maker of flex-fuel vehicles (General Motors), will head to China with his energy message in potential disarray.

Both aviation and biofuels industry leaders have expressed concern that the capacity to manufacture the advanced drop-in biofuels, along timelines required by the aviation industry and emissions policy, will require state intervention, and according to energy lobbyist Curt Rich, “no biofuels project is going to get a DOE loan guarantee based on the current DOE interpretation of U.S. energy policy.”

“Policy discussions and the hand-wringing over agreeing to emission reduction targets are interminable and they are distracting us from the far more important focus of taking action,” charged Air New Zealand CEO Fyfe,” referring to a global problem rather than merely the U.S. energy policy implosion. “This is simply a travesty. To my mind, the UN climate change discussions amplify all that is wrong with global politics. Whether under the Framework Convention on Climate Change, ICAO or elsewhere—it’s the same procrastination; multiple conferences of many thousands; turgid presentations and inequitable albeit politically acceptable backroom deals determining the shape of unwieldy global agreements at a glacial pace.”

Frye added: “I am very happy to see a price on carbon—it should be applied equitably across geographies; uniformly across all industry sectors; and it should incentivize improvement and investment in new green technologies rather than simply penalize all activity. I look forward to the day when we all stop protecting our respective butts in the endless policy debates and start focusing, globally, on concerted action.”

The remarks highlighted increased frustration among biofuels stakeholders at the pace of fuel development, and stakeholders have said that the lack of a constructive, stable carbon policy is the single most important inhibitor in the development of alternative fuels.