However, there is more to this story than just fuels. Petroleum refineries have evolved over the last century to produce not only a high volume, low value product like gasoline or diesel fuels, but also the starting materials for thousands of other higher value, lower volume chemical products. Although maybe only 7-8% of crude oil is used for chemical products, they represent the backbone of our modern society. Over many decades we have developed technologies to convert highly reduced carbon compounds into many forms of polymers and plastics, solvents with specialized properties, pharmaceuticals, etc. The return on investment for the petrochemical industry is greatly enhanced by this added value.

By contrast, a biorefinery utilizes highly oxygenated carbohydrate and lignin materials. Research and technologies for converting these chemicals into other products lags far behind traditional petroleum based chemistry and this technology gap needs to be reversed. Currently less than 10% of the raw materials for the chemical industry are derived from biomass.

Lignocellulosic biomass, the non-starch, fibrous component of plant material, is primarily cellulose (30-50%), hemicellulose (20-40%), lignin (15-25%), and other compounds including ash, resins, and minerals (5-35%). Cellulose (a polymer only of glucose) and hemicellulose (a more easily hydrolyzed polymer composed of five different sugars) can be fermented to ethanol. Lignin is the major non-carbohydrate structural component of wood. It is a highly aromatic phenolic polymer, with a molecular weight of about 10,000, derived from coniferyl alcohol.

There are many candidates for potential bioderived products. Hydrolysis of hemicelluolosic materials gives primarily sugars such as xylose and arabinose which can be fermented to give a four carbon compound, 2,3-butanediol, which can then be dehydrated to give MEK, methyl ethyl ketone. Genomatica, a San Diego based company, announced in February 2009 that it would license technology to produce MEK using genetically modified microbes ingesting sugar. At $0.65 per pound, that is the equivalent of $4.50 per gallon which gives a better margin than just producing ethanol. Xylose is also a starting material for biochemicals. Glycerol, a byproduct of biodiesel production, is found in antifreeze, cosmetics, detergents, and pharmaceuticals. Lignin can’t be used in fermentation, but its highly complex aromatic nature makes it an attractive candidate for conversion to high value compounds, which is currently being explored in several universities and private companies.

Successful investments in bioderived fuels and chemicals must be market driven. But the way we calculate the bottom line may need to be changed. How will new regulations on climate change affect these calculations? How much is it worth to our national security to become independent of unfriendly oil regimes that can hold our economy hostage? There is a lot of work to be done, but the payoff is worth it.