What's the Buzz? The 10 hottest topics in biofuels right now.

In San Francisco next week, Advanced Biofuels Markets opens with delegates from 16 countries.

What are the 10 hottest topics right now – What’s the Buzz?

Looking at the official activities, ABM will feature the live announcement of the 50 Hottest Companies in Bioenergy for 2011-12, the winners of the Day in the Life of Biofuels photo contest, and addresses from several dozen industry CEOs, foreign trade groups, trade association heads and government officials. Plus a whole lot of structured and informal networking.

But it’s the buzz, the talk on the sidelines, the mood, that defines a meeting. Some of that, we’ll find all about when we get to San Francisco.

But here are 10 themes that are shaping up to be the Buzz of the conference.

1. RFS. Hold or Fold? Critics want to scarp the Renewable Fuel Standard. Most of the industry trade associations have adopted a “don’t mess with the RFS” stand – based on the thinking that opening up the RFS, no matter for how worthy a purpose, will invite a wholesale re-write, and watering down, of the targets – creating a lose-lose for the industry as it fights for the policy stability needed to ensure scale-up financing.

2. Can Obama find the $510 million? The DOE, USDA and US Navy each pledged $170 million toward scale-up funding of advanced biofuels, for defense purposes. The Navy is having a hard time persuading the House Armed Services Committee to shift money from other programs to the biofuels program, Will the Navy have its way?

3. Elections. US presidential elections are a year away, but the campaigning is already fierce in early caucus and primary states such as Iowa, New Hampshire and South Carolina. Numerous Republican candidates, sensing a massive shift in Iowa Republican caucus voters from an economic focus to social issues, have decided to oppose ethanol subsidies. Who’s going to win? What are the stakes? What does it mean for industry?

4. Fuels, or chems, or something else? There’s been such a proliferation this year in target products, it hardly seems apt to call this publication Biofuels Digest anymore. Solazyme is making skin care and food products, Amyris is publishing “One Billion Things to Make from Biofene,” we think. Enerkem, ZeaChem, Cobalt, LanzaTech, Virent, Gevo and LS9, just to name a few, have the capacity to make a wide set of products and are in many cases focusing on the higher value food, feed, chemical and fragrance products. Will anyone be making advanced biofuels any time soon, aside from jet and military fuels?

5. The EPA’s attitude on waivers. WIll the EPA continue to enforce the RFS mandate for advanced biofuels based on production capacity, or will they mandate based on expected actual production, as the oil industry has requested. It’s a difficult balance. On the one hand, if mandates are tied to actual production, obligated blenders could escape the impact of mandates simply by bidding a nickel a gallon for renewable fuels, and watch the production cave in and the mandates come down.

But as integrated biorefineries start scaling-up that can produce both fuels and higher-priced chemicals, will blenders be obligated to blend fuels, even if the refinery on whose capacity the mandate was based is busy making isobutanol for the chemicals markets.

6. RIN prices. Ethanol RINs remain at prices so low they hardly matter, but biodiesel RINs have been on a roller coaster, reaching as high as $3 (per ethanol-equivalent gallon), and trading down now in the sub $2 range. Will RIN prices stabilize and provide an added incentive for scale-up investment.

7. BRICs and mortar. Shout “scale-up financing” at Sao Paulo’s Garulhos airport some time, and you’ll see a bunch of advanced biofuels industry CEOs turn their heads on  any given Sunday. But scale-up development is not only moving to Brazil, it is moving to China and India. Not to mention the strong interest in renewable chemicals throughout Asia.

8. Freshwater, arable land, potassium, phosphorus, nitrogen. We’ve heard about Peak Oil a lot. Years ago, they were probably jammering on about Peak Whale. But what about the looming shortages in freshwater, and nutrients such as phosphorus?

9. Feedstock development. You see it in aviation biofuels. Airlines want them. Producers want to make them. The spec is approved. Where is all the low-cost camelina, jatropha, algae and so on? It took 500 years to establish maize (corn) at its present scale. Scaling up advanced biofuels feedstocks in, say, a decade — at “everyday low prices” —  is the mother of all challenges.

10. Money. Well, that’s always on the list. But as Phycal’s Kevin Berner said, “at scale, any advanced biofuels project is a capital pig.” For $100 million, you can finance maybe 20 strong pilots. Or 2-4 solid demonstrations. But that’s not much more than the down payment on a full commercial-scale advanced biofuels refinery. Price tag on building the new biorefineries needed to meet global mandates and targets by 2025 – something on the order of $350 billion. That’s just for the refineries – lot more for feedstock, infrastructure and everything else.