For the first time, cellulosic biofuel is being manufactured and shipped commercially in the United States. It’s a start for an industry trying to catch up.

The company behind this breakthrough is Texas-based KiOR – last week it announced that it was making diesel from “pine wood chips previously feeding a shut down paper mill” at a plant in Columbus, Mississippi.

Columbus, Miss., plant (image via KiOR)
Columbus, Miss., plant (image via KiOR)

The Columbus plant is “designed as an initial scale commercial facility, processing 500 bone dry tons of sustainably harvested woody biomass per day,” KiOR said. “It can produce over 13 million gallons of gasoline, diesel, and fuel oil blendstocks annually, enough to fuel 25,000 cars.”

All biofuels face scrutiny for their greenhouse-gas benefits; in life-cycle analyses they can sometimes fall short of other ways to trim transportation fuel emissions, especially when indirect land-use changes are taken into account (a practice not universally accepted, it should be noted).

However, by making use of nonfood feedstocks, this new generation of fuels, as a broad category, certainly do better than conventional ethanol. They dispense with one of the big bugaboos of first-generation biofuels made from corn and soybean oil: their impact on food supplies and prices. And in this case, the output is arguably much more useful than ethanol, which can only be blended into conventional fuels in very limited proportions.

U.S. policy has been encouraging such fuels. They’ve been way behind schedule in arriving, but we’re starting to see a bit of a change in the picture. ZeaChem earlier this month said its demonstration plant in Boardman, Ore., was making fuel, although the company didn’t say if it had mustered enough product to ship commercially. And several other plants are expected to come online this year, including a couple backed by U.S. Department of Energy loan guarantees — and Abengoa plant, in Kansas, and a Poet plant, in Iowa.

The U.S. Energy Information Administration recently said output this year could “grow  to more than 5 million gallons in 2013,” and by 2015  production capacity could be up to 250 million gallons.

That’s good – until you compare it to expectations.

“Although cellulosic biofuels volumes are expected to grow significantly relative to current levels, they will likely remain well below the targets envisioned in the Energy Independence and Security Act of 2007,” the agency said. “That law set a target level of 500 million gallons of cellulosic biofuels for 2012 and 1 billion gallons for 2013, growing to 16 billion gallons by 2022.”

Notably, the EIA cast these next generation biofuels in a very positive environmental light – particularly when their possible byproducts are taken into consideration.

“A number of the projects … also generate a solid co-product with the potential for use as a fertilizer,” the agency said. “To the extent that feedstock for these processes are waste products and little-to-no fossil inputs are required for their conversion, greenhouse gas emissions could be as much as 80% to 90% below those of petroleum products on a life-cycle basis.”

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