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Biofuel production surged in 2010

Hydrocarbon Engineering,

Global production of biofuels increased 17% in 2010 to reach an all-time high of 105 billion litres, up from 90 billion litres in 2009.

Research conducted by the Worldwatch Institute's Climate and Energy Program pinpointed high oil prices, a global economic rebound, and new laws and mandates in Argentina, Brazil, Canada, China, and the United States, among other countries as contributing factors to the surge.

The United States and Brazil remain the two largest producers of ethanol. In 2010, the United States generated 49 billion litres, (57% of global output), and Brazil produced 28 billion litres, (or 33% of the total). Corn is the primary feedstock for U.S. ethanol, and sugarcane is the dominant source of ethanol in Brazil.

"In the United States, the record production of biofuels is attributed in part to high oil prices, which encouraged several large fuel companies, including Sunoco, Valero, Flint Hills, and Murphy Oil, to enter the ethanol industry," said Alexander Ochs, Director of Worldwatch's Climate and Energy Program. High oil prices were also a factor in Brazil, where every third car-owner drives a "flex-fuel" vehicle that can run on either fossil or bio-based fuels. Many Brazilian drivers have switched to sugarcane ethanol because it is cheaper than gasoline.

The largest producer of biodiesel has been the European Union, which created 53% of all biodiesel in 2010.

In the United States, however, the Environmental Protection Agency (EPA) made the decision to lower the country's production target for cellulosic ethanol, a biofuel that is made from woody plants or crop waste and that can be converted to ethanol much more efficiently than conventional ethanol.

"The EPA's target reduction reflects the technical challenges and high costs of commercializing so-called 'second-generation' biofuels," said Shrank. "Instead of the 950 million litres required initially under the 2007 Energy Independence and Security Act, the final target will be a much smaller 25 million litres."

Proposed legislation in the U.S. Senate would cut current ethanol production subsidies while maintaining tax credits for related infrastructure such as refilling stations. If supports like subsidies and tariffs are removed in the United States, sugarcane ethanol from Brazil will likely become more prevalent. In spite of the green credentials of bioethanol, there are concerns that it will accelerated deforestation in Brazil.

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