Pacific Ethanol, the corporate partner with UC Berkeley scientists in a pilot biofuel plant, filed bankruptcy petitions for its four refineries Monday, May 18.
The Sacramento-based company has teamed with the Joint Bioenergy Institute (JBEI), a Department of Energy-created lab in partnership with the university, its Lawrence Berkeley, Sandia and Lawrence Livermore national laboratories, along with UC Davis and Stanford University.
JBEI was funded by a $135 million grant from the federal Department of Energy. The federal agency has also put up $24.3 million for a Pacific Ethanol plant in Oregon that would transform plant fibers—rather than sugars—into ethanol. Pacific Ethanol is headed by Bill Jones, former California secretary of state and legislator.
The bankruptcy action filed Monday doesn’t include the parent company of the refineries, Pacific Ethanol itself, or the company’s two marketing subsidiaries, according to a statement released Monday at the time of the filing.
Biofuels—the major goal of at least $635 million in corporate- and federal-funded research at UC Berkeley—face an increasingly complex and troubled future.
Even larger than the federal JBEI grant is the $500 million pledged by BP, the former British Petroleum, for a broader spectrum of alternative fuel projects by scientists and UC Berkeley and the University of Illinois, Urbana-Champaign.
A wave of bankruptcies has swept through the synthetic fuel sector, triggered in part by last year’s soaring cost increases for corn and other agricultural commodities used as so-called feedstock for the refineries.
Pacific Ethanol is planning to use JBEI technology to produce ethanol from plant fiber, cellulose, rather from the sugars contained in crops like corn and sugar cane. JBEI and the BP-funded Energy Biosciences Institute are also aiming to produce other fuels than ethanol that burn more like gasoline.
The federal Environmental Protection Agency has warned that ethanol—a fuel that readily combines with water and burns at lower temperatures than gasoline—can damage engines of older cars. The Australian government has also reported that ethanol blends can lead to increased emissions of some carcinogens, according to a May 18 report by the non-profit Environmental Working Group.
Another potential problem confronting all fuels derived from harvested plant crops is grouped together under the heading “indirect land use effects.”
A major debate ensued after the California Air Resources Board (CARB) proposed considering indirect land use effects when evaluating the impacts of biofuel—called agrofuels by their critics.
The effects in question range from increases in carbon dioxide emissions from plowing up new land to impacts on food prices in low-income nations, and many of the UC scientists conducting research in synthetic fuels urged the board to reject inclusion of indirect land use impacts in their evaluations.
But CARB ruled on April 23 that indirect impacts must be considered when evaluating just how green biofuels are.
Synthetic fuel advocates have received one major boost, however, with installation of one of their strongest advocates as U.S. secretary of energy.
Former LBNL Director Steve Chu, now a member of the Obama cabinet, has made biofuels a major plank in his platform for Department of Energy research while killing off federally funded research on electric- and hydrogen-powered vehicles.