Spirits of Performance

Lawrence Ulrich and Gregory Anderson

04/01/2008

Less than a week before this magazine went to print, the journal Science released a report that said: "Converting rainforests, peatlands, savannas, or grasslands to produce food-based biofuels in Brazil, Southeast Asia, and the United States
creates a ‘biofuel carbon debt’ by releasing 17 to 420 times more CO2 than the annual greenhouse gas reductions these biofuels provide by displacing fossil fuels." In other words, fuels like ethanol and biodiesel can only help the planet when the manner in which they are produced results in less carbon being released into the atmosphere, not more. Which is what happens when you cut down rainforests (directly or indirectly) in order to plant corn or soybeans.

The blogosphere buzzed with the news, because the irony is too perfect: In humanity’s haste to convert vehicles to run on greener fuels, consumers may inadvertently be adding to the carbon-dioxide deficit and speeding global warming. It turns out that even if Americans are not cutting forests to produce biofuels, the people in third-world countries who rely on affordably priced corn from the U.S. will need to clear land in order to plant more food crops. Another potential problem is the heat required for the distillation process that produces biofuels. If that heat energy derives from coal or other carbon-emitting sources, the resulting clean fuel’s benefits can easily be negated. "The bottom line is that it’s become increasingly clear we can make biofuels in smart ways, and we can make them in really dumb ways," says Nathanael Greene, a senior policy analyst with the Natural Resources Defense Council.

"We need to be thinking about biofuels in a holistic way and minimize the negative impacts," Greene continues. "We need to look at the whole transportation system and change how we develop our communities, so we don’t have to hop in the car to get a quart of milk. And we need to improve our vehicles."

Heeding the call to develop cleaner personal transportation is Koenigsegg, the Swedish supercar manufacturer whose "Spirit of Performance" slogan has taken on a whole new meaning. As often happens, going green has its rewards. To capitalize on the fact that ethanol releases more energy than gasoline—resulting in increased engine power—Koenigsegg will equip six of its 20 aptly named Limited Edition cars to operate on flexible E85 fuel (which by law is available at every fuel station in Sweden). The CCXR model features a 5-liter twin supercharged engine, which boasts 1,018 hp, or 130 hp more than the standard CCX version. That translates into a higher top speed (which already tops 240 mph), and a €1.5 million sticker price (compared to €1,330,000 for the CCX).

Call it Scandinavian sensibility, but apart from Koenigsegg, Sweden offers many shining examples of how to make biofuel production a sustainable energy source. In the past 25 years, the country has nearly halved its dependency on foreign oil by producing biodiesel and ethanol using wood chips and waste from its forestry industry. Moreover, the Swedish government plans to wean itself completely from fossil fuels by the year 2020. Sweden has become so proficient at being efficient that alcohol confiscated at its airports is now recycled for fuel rather than being wastefully dumped down the drain.

Like many of those alcoholic beverages, ethanol is a simple grain alcohol—essentially moonshine for your car—fermented mostly from corn in the United States, sugarcane in Brazil, wood chips in Sweden, or feedstocks such as sugar beets and cassava. Henry Ford used 200-proof ethanol to power his early Model T, and for decades, ethanol has been blended with gasoline to boost octane and trim emissions. Small quantities go into 30 percent of the gasoline we buy. It’s also sold as E85, a mix of 85 percent ethanol and 15 percent gasoline (the gas in E85 is only added to render fuel ethanol unfit for human consumption).

Running American cars on Midwestern corn rather than Middle Eastern crude certainly sounds enticing, especially when every car on the road can burn E85 with only minor, low-cost tweaks to their engines. Already, more than 6 million cars and trucks—the vast majority from Detroit’s automakers—are "flex fuel" models capable of running on either E85 or gasoline, a fact many owners don’t realize. Further, the Big Three have pledged to double annual production to around 2 million by 2010; this would equal 20 percent of their total U.S. production.But even if we use an earth-friendly production process to produce ethanol, and have cars equipped to run on the renewable fuel, environmental critics note that it won’t matter if we can’t find any: The nation’s 180,000 gas stations have only 1,200 ethanol pumps between them, and most of those are concentrated in the Midwest’s corn-growing states.

Ethanol burns a bit cleaner than gasoline. But, as with other farm-grown fuels, its real environmental edge is that its growing plants absorb carbon dioxide from the atmosphere. That helps offset the CO2 produced when it’s burned. The downside is that a gallon of ethanol contains only about two-thirds the efficiency of a gallon of gas. So despite the horsepower increase, if your car manages 30 mpg on gasoline, it’ll drop to about 20 mpg on ethanol. And there is no free lunch: If prices are equal, ethanol will cost you more and require more trips to the pump.

It’s easy to mistake corn-based ethanol as a panacea for limited petroleum supplies. But that’s simply not the case. For instance, there exists an upper limit to the level of grain production required to meet demand. Even current ethanol needs have thrown food markets out of whack, more than doubling the price of cornmeal, a dietary staple for millions of the Western hemisphere’s poorest people—last year saw protests in Mexico City over the price of tortillas. Faced with the realities of a global food shortage due to Americans experimenting with food-based fuel sources, corn-derived ethanol quickly loses its luster.

Furthermore, critics dismiss ethanol as a boondoggle on behalf of big agriculture. A 51-cent per gallon federal subsidy, and a federal mandate for vastly increased ethanol production, has investors flocking to money-minting ethanol plants, though the rapid expansion and a potential ethanol glut have somewhat blunted the boom. In this climate, even some big corn growers doubt the nation’s farmlands can produce enough corn to satisfy both food needs and a vastly expanded ethanol market. By some estimates, every inch of land in Iowa and Kansas combined would need to be planted with corn to satiate America’s increasingly insatiable appetite for fuel.

Jason Hill, part of a University of Minnesota team that recently completed a two-year study of ethanol and biodiesel, says that converting every kernel of corn grown in the United States to ethanol would replace a mere 12 percent of today’s gasoline consumption—and just 2.5 percent when you count the energy needed to grow, harvest and transport the crop. The respected study also questioned the environmental benefits of corn ethanol: It found that corn ethanol produces barely more energy than what’s used to produce the fuel itself—including growing, harvesting and processing the crop—and would reduce greenhouse emissions by just 12 percent.

The economy and environmental cons of corn-based ethanol have produced a general consensus: Cellulosic ethanol is a better solution. "That’s the holy grail of ethanol production," said Matt Hartwig, spokesman for the Renewable Fuels Association.

Until recently, there has been no efficient, cost-effective way to produce cellulosic ethanol. But a number of companies are seeking to crack the code. Coskata, an Illinois-based company, claims its patented process creates affordable ethanol using anything from switchgrass, wood chips, and corn stalks to municipal garbage and old tires—pretty much any carbon-rich substance will do. Company officials say their super-strains of microorganisms ferment ethanol quickly and keep large-scale production costs below one-dollar per gallon, about half the price of producing gasoline. That’s low enough to compensate for lower mileage ratings that cars return on ethanol."We believe we should see E85 prices between 50 cents and a dollar less per gallon than gasoline," says Bill Roe, Coskata’s CEO. "That’s entirely possible and necessary, or else consumers won’t see it as a viable alternative."

The Argonne National Laboratory has analyzed Coskata’s process, confirming that its ethanol would produce 7.7 times more energy than that used to create the fuel, versus a meager 1.3 return for corn-based ethanol. It also uses less than one gallon of water to produce a gallon of ethanol, versus the three to five gallons needed for corn, delivering another major environmental edge.

His company’s process, says Roe, can convert biomass into a pure stream of ethanol in around two minutes by breaking raw plant material into component carbon dioxide, carbon monoxide and hydrogen with high temperatures in a process called gasification. The bacterial microorganisms then ingest the resulting "syngas"—which has about half the energy density of natural gas—and ferment it into ethanol.

Coskata—whose backers include noted Silicon Valley energy investor Vinod Khosla, along with General Motors—intends to have a pilot plant running by early next year that would convert four different feedstocks into ethanol. By 2011, a commercial plant should be pumping out 50 to 110 million gallons of ethanol each year, some of which GM plans to use in test vehicles at the Milford Proving Grounds in Michigan. Ultimately, Coskata wants to build a network of plants that rely on local waste biomass, and produces fuel for local or regional use, cutting production and transportation costs.

It can’t happen soon enough. A noted 2005 Department of Energy study, dubbed the "billion ton study," determined that the country creates 1.3 billion dry tons of biomass waste each year, enough to replace 30 percent of the nation’s gasoline consumption on a sustainable basis.

And the new energy bill mandates a 500 percent increase in the production of ethanol and other renewable fuels by 2022: A total of 36 billion gallons annually, with 21 billion gallons of that coming from cellulosic ethanol and other non-food sources.

In the past, renewable fuels and other alternative energy programs usually went to the back burner whenever gas prices fell. But the situation is different this time around. We’re not only serious about tackling global warming, but we understand that China, India and other booming economies will place unprecedented demands on a finite oil supply. The days of $20-a-barrel oil appear to be over.

"We’re one international incident away from a major interruption of our transportation, and that wouldn’t be a pretty picture," Roe said. "The things that should have been done for national energy security are late, but they’re going to go forward this time." Make that fast-forward, if cars like the Koenigsegg CCXR are any bellwether for a bio-fuelled future.

Koenigsegg, www.koenigsegg.com