EIA finds previous estimates generous
All EIA forecasts and projections made since the passage of the Energy Independence and Security Act of 2007 anticipated large shortfalls between the renewable fuel standards targets and the volumes of cellulosic biofuels sold. Despite this, EIA says its forecasts and projections to date have proven to be too optimistic, as volumes have been below expectations.
Looking forward, important challenges remain for cellulosic biofuel production, EIA says. Total production costs for many of these first-of-a-kind projects remain higher than the cost of petroleum-based fuels on both a volumetric and energy-content basis. Cellulosic ethanol also faces the same market and regulatory challenges to increasing its share of the fuel market that is faced by other types of ethanol.
But, EIA says, over the medium to long term, technologies to produce intermediate chemicals from cellulosic biomass have the potential to increase business margins and diversify revenue sources.