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Defense department only source of investment for biofuels—oil and gas lobbies in Congress prevent any funding <>

Erwin 14 (Sandra I, Editor of National Defense, magazine of National Defense Industrial Association, January 1 2014, "Navy to Stay the Course With Biofuels",

Biofuel producers certainly hope so. The Defense Department emerged in 2009 as a champion of biofuels in the wake of steep oil price hikes that cost the Pentagon billions of dollars in unforeseen expenses. But in just the past four years, the industry has seen the political and economic climate deteriorate. Oil and gas production is booming in the United States, making biofuels less appealing. The Environmental Protection Agency dealt the industry a major blow last year when it recommended reducing the amount of ethanol in the nation’s fuel supply. Suppliers now see the Navy as a slim ray of hope in a cloudy future. “We are encouraged by what the Navy is doing,” says Hugh C. Welsh, president of DSM North America, a materials and chemicals multinational corporation that is investing heavily in biofuels. “The Navy sees the tactical and strategic advantages of drop-in biofuels,” Welsh says in an interview. “I am happy to see that they are continuing with their program. They seem less hamstrung by all the political nonsense that is going on. They see these fuels as aligned with their strategic objectives.” Biofuel producers worry about a changing political climate in which the U.S. oil and gas industry are gaining strength as domestic production makes the nation less dependent on foreign suppliers. The oil and gas lobbies, Welsh says, have waged a year-long campaign to undermine the development of advanced biofuels and the renewable-fuel standard. The RFS requires oil companies to blend ethanol and biodiesel into their gasoline. Welsh says the EPA's recommendation to weaken the RFS will dampen innovation and private investment. Corn-based or sugar-based ethanol is a low-density fuel that is mixed with gasoline. The advanced biofuels sought by the Defense Department demand additional industry investment. They must be drop-in substitutes for conventional diesel, jet fuel or gasoline. They also must be made from low-carbon, sustainable feedstocks rather than food product sources. Advanced biofuels such as cellulosic ethanol use biomass, including corncobs, leaves, husk and stalks for its raw material. “Our company spent $150 million building a commercial scale cellulosic biofuel plant,” says Welsh. While the industry is discouraged by the administration’s decision on the RFS, “We are working to get the support from Washington that was promised,” he says. The military market presents an opportunity. “We'll continue to develop applications for drop-in for jet fuel,” says Welsh. Although the Pentagon only accounts for 1.5 percent of the nation’s fuel consumption, biofuel investors have looked at the Defense Department as the preferred catalyst for a massive expansion of production in the United States.

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