"Can't singlehandedly drive a market"
Mark Iden of the Defense Logistics Agency confirmed that the US government proposed to purchase several hundred million gallons of drop-in advanced biofuels by 2016, citing an expected demand of 336 million gallons from the Navy and 587 million gallons from the Air Force.
But Iden, likened the government, although a large customer, to a large commercial airline in terms of purchasing power, and cautioned biofuels producers that the Department of Defense would be a large buyer but not in enough quantity to “singlehandedly drive a market.”
At the same time, Chris Tindal of the US Navy said that the Navy would undertake a “biorefinery development analysis” to see how the Navy should participate in the development of advanced biofuels to ensure sufficient production and the lowest price for advanced biofuels.”
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The National Renewable Fuels Standard (RFS)Program for 2016 requires 7.25 billion gallons of advanced fuel by 2016 of which 4.25 billion gallons are to be derived from cellulosic biofuel. The extent to which this source will be economically viable is very uncertain. The only other likely domestic source for advanced biofuels is biodiesel. If the RFS mandate for 3 billion gallons of advanced biofuels by 2016 is enforced, biodiesel production could expand beyond the RFS minimum of 1 billion gallons. Has the Defense Logistics Agency established the intended source for the 923 million gallons of advanced biofuels for 2016?
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