Clarifying the biofuel carbon offset

Components of the biofuel carbon offset. The gross offset comprises the whole pie; the net induced offset is highlighted in blue. Based on stock-and-flow modeling of a corn ethanol scenario. 

The carbon neutrality of biofuel combustion is sometimes discussed in terms of its fossil fuel offset, i.e., the fossil carbon emissions that are avoided when it is used in place of a fossil-based fuel such as conventional gasoline. The offset occurs because the biofuel contains biogenic carbon recently removed from the atmosphere by photosynthesis instead of fossil carbon that was buried underground. 

As the U.S. Environmental Protection Agency (EPA) stated in its Renewable Fuel Standard (RFS) regulation, "For renewable fuels … the carbon emitted as a result of fuel combustion is offset by the uptake of biogenic carbon during feedstock production." As explained below, this assumption of a feedstock offset is not generally true. In particular, it fails for fuels derived from commodity crops, as is the case for most biofuels now produced at commercial scale. 

Substituting biofuel for fossil fuel triggers changes in several different carbon flows into and out of the atmosphere. The technical literature has examined these effects using complex methods such as consequential lifecycle analysis (CLCA) and integrated assessment modeling (IAM). However, the key concepts can be explained using a relatively simple stock-and-flow model. 

I built such a model to illustrate the main carbon flow effects associated with biofuel use. Although its parameters were chosen from the literature on corn ethanol, it deliberately omits the ancillary, production-related GHG emissions that are the traditional focus of LCA. The objective is to offer insights rather than generate specific numerical findings.  

Researchers have identified three market-mediated effects that contribute to offsetting a biofuel's biogenic emissions. They are induced by the marginally higher crop prices that result as biofuel feedstock demand is added to demand for food and feed:  

• Decreased food consumption due to the higher prices; this can be termed the deprivation effect (although some of it may result from more efficient use of crop harvests).  
• Increased crop yields as farmers in response to the higher prices, comprising what is known as the intensification effect and thereby increasing the rate of net carbon uptake. 
• Increased overall harvests obtained by planting more cropland, a response known as the extensification effect and which involves land-use change (LUC) that may impact carbon-rich natural lands. 

The extensification-driven LUC can cause a large short-term release of carbon into the atmosphere, incurring what is known as carbon debt. By reducing the area of natural land that is actively storing carbon, it can also result in foregone sequestration that undermines the net offset. The deprivation effect reflects the "food versus fuel" problem and contributes to the offset by reducing carbon consumption by the food system. That implies a lower rate of CO2 emissions from respiration and thereby effectively raising the rate of net carbon uptake by the biosphere. Although intensification does not have the adverse impacts of these other two effects, it can result in higher GHG emissions from greater use of fertilizers, irrigation and other ancillary farming activities (as commonly evaluated by LCA, but omitted for the conceptual analysis described here). 

In addition to these effects on biogenic carbon flows, the decreased petroleum demand as biofuel displaces fossil fuel can decrease petroleum prices and cause a rebound effect of increased fuel demand and its associated CO2 emissions in other markets, further undermining the net offset. 

The pie chart above summarizes how these carbon flow changes influence the biofuel offset. The entire pie represents a complete balancing ("neutralization") of a biofuel's biogenic emissions through gains in net carbon uptake. This constitutes the gross offset. It has three components that fill the pie including the cross-hatched portions. They are depicted here based on nominal parameter values for a stock-and-flow scenario detailed in the paper on which this post is based. Deprivation accounts for 33% of the gross offset (pink slice); intensification accounts for 15% (green); and the remaining 52% is from extensification (beige), reflecting the area of new cropland put into production to supply both biofuel production and food system consumption. 

The cross-hatched portions show the countervailing effects of foregone carbon sequestration, which erodes 8% of the gross offset, and petroleum market rebound, which erodes 20% based on the assumed parameter values. That leaves the net induced offset, amounting to 72% of the gross offset. It determines the long-term net emissions reduction obtained when biofuel replaces fossil fuel. 

Biofuels can be seen as carbon neutral to the extent that their production induces a gross offset. Explicitly tracking carbon flows with a stock-and-flow model makes it clear that "neutralizing" biofuel CO2 emissions involves several distinct mechanisms rather than a presumptive feedstock offset. Moreover, the net induced offset is less than a full offset even before considering a biofuel's non-biogenic, production-related GHG emissions as evaluated by LCA. Stock-and-flow modeling also highlights the strong time dependence of a biofuel's impact on atmospheric carbon when land-use change is involved, showing how the net induced offset influences the slope of the decline in the atmospheric carbon stock that pays down carbon debt. 

This illustrative analysis pertains to a crop-based biofuel such as corn ethanol. For other biofuels, such as those derived from biomass waste, different mechanisms could be involved, but a stock-and-flow analysis would still apply and their net offset would still be less than a full because of the rebound effect. 

Visualizing the time-varying carbon impact of biofuels

Several years ago I did a post entitled "When do biofuels really balance carbon?" At issue is the belief that biofuels are inherently carbon neutral. That assumption is typically justified in terms of a feedstock offset, i.e., that a biofuel's end-use and other biogenic CO2 emissions are fully balanced by CO2 uptake during photosynthesis when their feedstocks are grown. However, that proposition is not generally true. A more correct understanding is that the CO2 emitted from biofuel use can be partly balanced by gains in net CO2 uptake in several locations (not just where feedstock is grown) over a possibly long period of time.

In the biofuel literature, this understanding of biofuel-related carbon flows was developed through consequential lifecycle assessment (CLCA) modeling, which is quite complicated and hardly transparent. However, the key insights can be seen with relatively simple stock-and-flow modeling. The outcome of such an exercise is described here.

The following figure shows illustrative results for a scenario of biofuel use as shown in the bottom panel (c) of the figure. This model input assumes that corn ethanol use ramps up to 13 billion gallons per year (Ggal/year) over a 10-year period (2005-2015) and then remains constant thereafter. The analysis was done in units of teragrams of carbon (Tgc); 13 Ggal/year of ethanol corresponds to 20 Tgc/year on a carbon (not CO2) mass basis.

Changes over time in (a) atmospheric carbon and (b) net carbon emissions due to (c) biofuel use. Shown relative to a fossil-fuel reference case; units are teragrams of carbon (Tgc). 

The middle panel (b) shows the effect on net carbon emissions. Emissions rise sharply as ethanol use ramps up, reflecting the release of terrestrial carbon stocks as natural lands (such as tropical forests or grasslands) are cleared, directly or indirectly, to make way for new cropland. Such land-use change is triggered by the additional crop production needed for biofuels. Once biofuel use stops rising (after 2015 in the scenario modeled), net carbon emissions fall below the fossil fuel reference case. This emission reduction, which amounts to roughly 17 Tgc/year for the case shown here, reflects the net induced offset due to biofuel use. It is less than a full offset of the biofuel's associated biogenic emissions and results from changes in several carbon flows economically induced by biofuel use as explained in a subsequent post.

The top panel (a) shows the resulting change in atmospheric carbon which, as a stock, is the integral of the net emissions flow of panel (b). Atmospheric carbon rises above the fossil fuel reference level as biofuel increases, reflecting the carbon debt from the biofuel-related land-use change. Atmospheric carbon begins decreasing once biofuel use stops increasing, falling below the reference level after 2054. That is 48 years after the first year of modeled biofuel use (2006) in the scenario shown here, reflecting the time it takes to pay back the carbon debt and highlighting the nearly five decade lag before the biofuel use achieves a net CO2 reduction.

This greatly delayed climate mitigation is obscured by most LCA studies, which smooth over important time-varying effects when reducing their results to carbon intensity values (e.g., grams of CO2-equivalent per megajoule of fuel). The system dynamics revealed by stock-and-flow modeling emphasize that, although biofuels may offer a long-term net carbon reduction, they can make matters worse before they get better.

The latest light truck versus EV emissions gap

CO2 reduction from EVs compared to CO2 emissions increase from higher light truck sales,
light-duty fleet average changes from 2012 through 2021.  

Although U.S. electric vehicle sales have been growing by leaps and bounds, so too have the sales of large light trucks. Last year, my analysis of the then-current EPA data revealed that CO2 emissions due to the market shift to light trucks (mainly pickups and most SUVs) was over five times greater than the emission reduction that EVs would have achieved on their own. This gap has dropped to just under a factor of four, as shown in the chart above. In short, EVs sales still have not made a dent in the overall lifetime carbon burden of the new light-duty vehicle (LDV) fleet. 

Looking back at the RFS on the eve of its target year

When Congress and the Bush Administration expanded the Renewable Fuel Standard in 2007, they set next year as the target for a full-scale biofuel mandate as then envisioned. The goal was 36 billion (ethanol-equivalent) gallons by 2022, with 16 billion of those to have been cellulosic ethanol or other fuels derived from such non-food feedstocks. 

Just posted on The Conversation is my look-back at the RFS, pointing out that the U.S. biofuel mandate helps farmers, but does little for energy security and harms the environment. It reviews the RFS experience to date in terms of the policy's three main rationales: improving energy security, reducing CO2 emissions and boosting agricultural income. My article's title sums it up ... read more there! 

Cellulosic ethanol's highly subsidized failure

Actual U.S. production of cellulosic ethanol and other cellulosic liquids compared to the targets for cellulosic biofuels specified in the Renewable Fuel Standard

Cellulosic ethanol, once a great green hope for cutting petroleum use and CO2 emissions, has been a bust. The chart above compares the volume of cellulose-based liquid biofuels (largely ethanol) actually used in the United States to the targets for such fuels set by Congress when it expanded the Renewable Fuel Standard (RFS) in 2007. Note the logarithmic scale on the vertical axis; the gap between promise and reality is so large that actual production would be barely visible on a linear scale. 

The fuel has been delivered at levels of no more than about 0.1% of (three orders of magnitude less than) the volumes on which the RFS was premised [1]. This chart does not include cellulosic biogas, which EPA re-classified to qualify for RFS compliance purposes and has seen recent production of around 500 million ethanol-equivalent gallons. However, such "renewable natural gas" is not in the spirit of the law, which envisioned liquid biofuels that could be readily used in motor vehicles. The 2019 RFS target for cellulosic biofuels was 8.5 billion gallons, set to reach 16 billion gallons by 2022. But in 2019, before the pandemic-related drop-off in 2020 for nearly all forms of energy, only 9.8 million gallons of cellulosic ethanol were tallied by EPA.  

Newly proposed auto standards hold promise

The Biden Administration is clearly making good on its pledge to revisit the automobile GHG emission standards weakened by the previous administration. The notice of proposed rulemaking issued by EPA on August 5, 2021 aims to cut model year 2026 car and light truck GHG emission rates 17% compared to the recent level, from 205 grams/mile (g/mi) in 2020 to a nominal target of 171 g/mi in 2026. 

The White House announcement just prior to the EPA proposal also states an ambitious goal for EVs to comprise half of U.S. vehicle sales in 2030. This non-binding target would include plug-in hybrid electric vehicles (PHEVs) as well as pure zero-emission vehicles such as battery electric and fuel cell cars. 

Fleetwide efficiency gains more important than electric cars over the next decade

For at least the next decade, the overall fuel economy of the entire car and light truck fleet will be more crucial for climate protection than the number of electric vehicles sold. That's the message of my recent online article in Scientific American: "Want Greener Cars? Focus on Fuel Efficiency." Read the discussion there (the article was first published in The Conversation under the title "To make the US auto fleet greener, increasing fuel efficiency matters more than selling electric vehicles").   

Personal trucks widen emissions gap over EVs

Excess carbon dioxide emissions from the rising popularity of light trucks, such as the Ram pickup, swamp many times over the potential carbon savings from increased sales of EVs, such as the Tesla Model 3, to date.  

Last fall, I posted an analysis showing that, even as electric vehicle sales had grown significantly over the past several years, the broader market shift to personal trucks (mainly SUVs and pickups) has overwhelmed the potential CO2 reductions from EV use by more than a factor of four. With the new EPA data now released, this ratio has increased to a factor of 5.6, as shown in the chart below. 

GM touts innovation while weakening regulation

My opinion piece published in The Detroit News points out the inconsistency of how some automakers have advocated for weaker fuel economy and GHG emission standards even as they promote their technology innovations. Taking General Motors' recent public statements as an example, it reminds readers that what ultimately matters for reducing emissions is the stringency of the regulations that apply across the entire vehicle fleet. 

Light trucks overwhelm EVs' carbon-cutting benefits to date

Electric vehicle sales have grown rapidly over the past several years. In 2012, only about 53,000 EVs were sold in the United States, counting both battery electric and plug-in hybrid models. By 2018, the annual tally of new EVs sold in the United States reached 361,000. It then tapered to 327,000 in 2019, the last full year of data before the 2020 pandemic. The vast majority of EVs are Teslas, with the big jump in 2018 due to the introduction of the Tesla Model 3. With overall light vehicle sales on the order of 17 million per year (pre-pandemic), EVs comprised about 2% of the U.S. market as of 2019.

A missing link in green car marketing

One of the reasons why automakers have advocated weaker fuel economy and greenhouse gas (GHG) emission standards is that lower-than-expected fuel prices have lessened consumer interest in higher fuel economy. Although insufficient consumer interest relative to environmental need is the main reason why regulations are needed, lack of consumer interest is a legitimate concern. The challenge is quite real when the market is pulling one way while regulations are pulling another.

Nevertheless, environmental need -- and indeed policy-fostering public sentiment to address global warming -- does not go down when pump prices fall.

Earth Day and auto efficiency

On Monday March 9, 2020, just before the coronavirus lockdown, I hosted a pre-Earth-Day teach-in on auto efficiency. It was part of the commererative week of action that the University of Michigan had planned to celebrate the 50th anniversary of the first Earth Day, April 22, 1970. 

Considering petroleum's grip on mobility

Oil has sustained its energy dominance largely due to its convenience for supplying transportation fuels. Petroleum is largest source of CO2 emissions in the United States and second largest globally. Addressing this part of the climate problem means confronting both the market factors and market actors that determine petroleum supply and demand. 

My recent discussion paper examines this intersection of transportation, oil and climate. It traces recent trends affecting petroleum supply and demand, providing a perspective on the industry's interests and how the sector might be affected by potential demand disruptions due to policy changes and innovations in mobility systems. The pertinent aspects of energy policy reflect an ever-evolving political process that attempts to balance competing forces, including the oil industry's desire to maximize income and minimize costs, popular pressures to keep prices low, public sector needs for tax revenue and environmental concerns. 

These forces are now amplified by the pace of innovation. Impacts were seen first on the supply side through developments such as fracking. Next up are changes on the demand side, including new mobility options such as ridehailing, vehicle electrification and rising levels of vehicle automation. Although it is unclear whether such changes will be evolutionary or revolutionary, their net long-run effect is likely to be increased demand for mobility. Policies to address the climate concern seek to decouple transportation from oil, creating a petroleum demand destruction risk that the industry can be expected to resist.

Read the full analysis at:

DeCicco, J.M. 2019. Market Factors Related to Transportation, Oil and Climate. Discussion Paper. Ann Arbor: University of Michigan Energy Institute. January. https://bit.ly/mktftoc19

Can the Trump administration pull off a clean car deal after all?

Regulations have long been a bone of contention between automakers and green groups, with policymakers caught in the middle. The disagreements have grown sharper than ever over the past two years, culminating in an August proposal from the Trump administration. That plan detailed a preferred option of freezing car and light truck Corporate Average Fuel Economy (CAFE) and greenhouse gas (GHG) emission standards after 2020.

In response -- and they were indeed prepared for this worst-case scenario -- the State of California and its allies have girded for legal battle. They filled the docket with comments and extensive supporting analysis designed to fight the administration's crippled standards in court. On the other side, automakers -- who had prompted the administration to revise the regulations -- hailed the Trump agencies regulatory reform process even though they said it weakened the rules even more than they wanted. At that juncture, it seemed like years of litigation might be inevitable.

Nevertheless, a look at the formal comments filed reveals the makings of a compromise peeking through the otherwise disparate views. Recent news stories report that serious negotiations between California and the Trump administration seem to be underway. My recent Axios piece muses about how a compromise on car standards could be in sight.

Pondering the future of the car with the planet in mind

Historical vehicles on display at General Motors Factory One (left to right): Flint Road Cart (1886),
Buick Model C (1905) and Chevrolet Classic Six (1913)  [photo: Jason Robinson, courtesy of General Motors]

This year, the Society of Environmental Journalists' (SEJ) Annual Conference was held in Flint, Michigan. The city has been in the news recently because of its toxic, lead-contaminated tap water, a public health crisis brought on by negligence and indifference at all levels of government. Clean water was a major theme of the event, which included moving presentations by members of the community, activists and researchers involved in the crisis.

Historically, however, Flint is one of the cities that gave birth to the automobile. William Durant, a key co-founder of General Motors, and his partner Josiah Dort opened a factory for making horse-drawn carriages there in 1886. That building subsequently became an early factory for Durant's car company before falling into disuse in 1924. Five years ago, General Motors purchased the building and named it Factory One, turning the refurbished structure into a museum and event space.

This location served as a fitting venue for an evening plenary on the Future of Cars held on October 3, 2018, the first day of the SEJ conference. Moderated by Jim Motavalli, the panel included Michelle Krebs, a leading automotive analyst, Mike Ableson, a GM vice president involved in the company's electric vehicle efforts, and myself.

Reconsidering bioenergy

Accelerated restoration in progress at the Malheur National Forest, Oregon  [photo: U.S. Forest Service] 

Protecting the Earth's climate takes on greater urgency every day. The vast majority of carbon dioxide (CO2) and other climate-wrecking greenhouse gas (GHG) emissions comes from the unmitigated use of fossil fuels. But that doesn't mean that every form of alternative energy is helpful for the planet. Case in point: bioenergy, such as liquid biofuels to replace oil or forest products to replace coal.

Indeed, using biomass for energy at large scales does not belong on the short list of actions to take for climate protection. This is the conclusion of a commentary by Bill Schlesinger and myself just published in the Proceedings of the National Academy of Sciences. Given the real-world limitations of not only technology but also land-use governance, we argue that the priority policymakers have given to promoting bioenergy is profoundly misplaced.

No justification for weaker CAFE standards

Interior view of the 2019 Ford F-150 Limited edition pickup truck. Such luxurious features in what were once utilitarian vehicles showcase automakers' impressive design and technology capabilities. The key policy question is how well these capabilities can be harnessed to improve fuel economy rather than offering ever more niceties at the expense of better protecting the environment. [photo: Ford Motor Company media] 

This week the administration is holding public hearings on their proposal to weaken Corporate Average Fuel Economy (CAFE) standards after 2020. What follows is the comment I prepared for the hearing being held today in Dearborn, Michigan. 

Comment on CAFE and GHG Standards Proposed Rule
for MY 2021-2026

John M. DeCicco, Ph.D.
University of Michigan Energy Institute*

Thank you for the opportunity to present this comment today.

Having reviewed the proposed rule, I find that it fails to scientifically or economically justify freezing the standards for model years 2021 through 2026. My assessments show that the greenhouse gas emissions and fuel economy standards for those years remain sound.

My overarching conclusion is that there is no justification for changing the standards.

The one new development with any significance is that fuel prices are lower now than projected. However, this does not justify weakening the standards. Lower prices are all the more reason why fuel economy and emission standards should remain untouched.

The precarious state of fuel economy policy

Rated at 25 mpg, the Toyota RAV4 is a good example of the average new personal vehicle now being
sold in the United States, emitting 5.2 metric tons of CO2 per year over 15,000 miles of driving. 

Any day now, the Trump Administration will formally propose its revisions to the coordinated program of Corporate Average Fuel Economy (CAFE) and greenhouse gas (GHG) emission standards for cars and light trucks. EPA Administrator Scott Pruitt has determined that the existing standards, set in GHG terms by the previous administration for model years 2021-25, are too tough. Everyone expects that the proposal will weaken the regulations; the question is by how much.

As a long-time analyst of automotive fuel economy policy, over the past few weeks I've written several pieces providing perspectives on the issue as linked here.

Even though it's not a good reason to weaken the standards, automakers do have a valid concern about low consumer interest in ever-higher fuel economy. The tension between what consumers desire and the need to cut GHG emissions is a problem to take seriously and address creatively. This challenge is discussed in my recent piece "Why aren't automakers connecting better with green-minded consumers?" in Automotive News.

A broader look at the regulatory dispute is given the piece, "After Years of Green Promises, Automakers Renege on Emissions Standards," published last week by Yale Environment 360. Hooking to visionary-sounding statements by GM's chief executive, it highlights the contrast between the automaker's promise of technological solutions and the efforts to fight the policies needed to bring such solutions to fruition. That's an old story in the long-running debates about clean cars. However, with automakers now able to exploit the empowered political hostility to the environment that they (and some other industries) cultivated over the years, progress may soon grind to a halt. My comments echo those of others who point out California's crucial leverage on the issue.

A concise take on this very point is given by my Axios Expert Voices piece, "Automakers struggle to head off the California–EPA legal battle," published earlier last week.

A couple of months back, shortly after Administrator Pruitt issued his notice about the process to revisit the CAFE and GHG emissions standards, I argued that "Stronger fuel standards make sense, even when gas prices are low" in The Conversation (and also republished by Salon and other outlets).

Breaking down biofuels analysis

Debates about the merits of biofuels have gone on for at least a generation. Over time, one might think that the accumulation of data would resolve key issues, especially those about biofuels and global warming. Nevertheless, the arguments not only persist but have become even more heated.

What has taken things to a new level of contention is that some researchers (myself included) are now rethinking the heart of the matter, namely, the belief that biofuels are inherently carbon neutral. This is the assumption that the CO2 emitted when biofuels are burned does not lead to a net increase in emissions because the carbon in the biofuel is recycled during feedstock growth. My new paper, "Methodological issues regarding biofuels and carbon uptake" published in the journal Sustainability, breaks this aspect of the debate down to its bare essentials.

Stronger fuel standards make sense, even when gas prices are low

The current Republican administration is taking steps to weaken EPA's greenhouse gas (GHG) emission standards for cars and light trucks. One of the stated reasons is that lower fuel prices make it more difficult for automakers to comply with the regulations. However, car companies are already well on the way to re-engineering their vehicles to cut emissions through higher fuel economy. Fuel prices are a fickle friend when it comes to the crucial long-term quest to cut climate-disrupting GHG emissions. So that's all the more reason to keep strong standards in place, as explained in this recent piece published on The Conversation.