A consumer's guide to biofuels

Crude oil prices recently topped $100 per barrel for the first time. That's bad news for consumers, because it means gasoline and diesel prices will likely hover at historic highs for some time to come. 

Luckily, more sustainable alternatives to oil are gaining attention and popularity. 

One of the most discussed replacements is "biofuel" — any liquid fuel derived from biological material such as trees, agricultural wastes, crops, or even grass. 

The two most common biofuels are ethanol and biodiesel. Each of these has its own unique characteristics and feedstocks (required raw materials). 

Here's some straightforward information to help you understand what ethanol and biodiesel are and decide whether these biofuels are right for you. 

Ethanol

Ethanol is the most widely used biofuel in the United States. Last year, we consumed 4.9 billion gallons of ethanol. You might have ethanol in your car's fuel tank and not even realize it. 

Why? Ethanol is a substitute for gasoline. It's also an oxygenate — a type of fuel additive that's needed to make your car run smoothly. In many states, the regular gasoline you buy at the local filling station might already contain 2, 5, or even 10 percent ethanol by volume. 

Ethanol is an alcohol that's traditionally made from sugar or starch crops, like corn or sugarcane. Of course, as demand for ethanol grows, demand for corn will grow as well — likely resulting in more-expensive corn. 

That's why a new way of making ethanol is being developed that doesn't use food crops. Instead, the "cellulosic ethanol process" makes ethanol from woody crops like trees and grasses. That's a lot better for many reasons, but it's also currently more expensive. 

RMI is working closely with the National Renewable Energy Laboratory (NREL) and others to help bring down that cost and commercialize cellulosic ethanol. NREL, along with several private companies working in this field, believe that we could see cost-effective cellulosic ethanol in as few as 3-5 years. 

Biodiesel

Unlike ethanol, biodiesel is a substitute for diesel fuel — it can't be mixed with gasoline. Since we use much less diesel than gasoline in the U.S., there's also much less demand for biodiesel. 

However, the biodiesel industry is growing quickly. In 2005, more than 75 million gallons of biodiesel were produced in the U.S., primarily from soybeans. Any vegetable oil crop can also be used. 

The process of producing biodiesel is much more straightforward than the process for producing ethanol, but there's also less room for technological innovation. 

How sustainable are biofuels?

We often hear that biofuels are "green" — that they are one of the key resources for reducing the impacts of climate change. When it comes to sustainability, though, the most important thing to remember is that not all biofuels are created equal. 

"Sustainability" comprises many factors — climate-change impact, of course, but also other environmental impacts such as water pollution, soil erosion, and ecosystem preservation. The following table outlines some of the impacts of different types of biofuels: 

So while corn ethanol is moderately better than gasoline from a climate perspective, it has a number of other negative environmental impacts. 

Biofuels and you

Even though cellulosic ethanol -- one of the most sustainable of the biofuels — is not currently available at filling stations, other biofuels are. Using biofuels now can increase the market demand for those fuels, eventually leading to more investment in advanced biofuels.

So how can you start using biofuels? 

First of all, if your car runs on gasoline, ethanol is the appropriate biofuel to consider. If you want to use more than 10 percent ethanol (which may already be in the gasoline you use), try E85 — a blend of 85 percent ethanol and 15 percent gasoline — which is available at more than 1,200 filling stations around the country. To find the nearest E85 filling station, visit the Department of Energy's interactive map, which is constantly updated. 

However, not all cars can run on E85. To do so, your car must be a Flex Fuel Vehicle (FFV), which has been specifically adapted to run on high blends of ethanol. Several automakers sell FFVs as standard models, and there are more than 4 million FFVs on the road today. 

If your car is an FFV, it will be labeled as such on the inside of your gas cap. You can find a list of FFV models at Yahoo! Autos.

 If your car runs on diesel, biodiesel may be appropriate for you. Visit the National Biodiesel Board for more information on using biodiesel and to get a map of filling stations.