Searching for Unity
In late 2010, the Global Biofuels Alliance tossed its hat into the biofuels arena, bringing the total number of trade organizations serving the biorefining sector to eight. While some of these voices, including the Renewable Fuels Association, the American Coalition for Ethanol and National Biodiesel Board have an extensive history of serving the interests of first-generation biofuels, several new organizations have popped up in recent years to support the development of second- and third-generation companies.
When the policy goals of these disparate trade organizations align, it is possible for them to speak to federal lawmakers with a powerful chorus of voices, which has clear benefits for the industry as a whole. When different factions of the industry start pushing opposing messages that frame each other as competitors, however, the results can be overwhelmingly negative. These competing messages can confuse federal lawmakers and undercut the ability to develop the policy objectives that all sectors of the biorefining industry need.
Those leading these trade organizations seem to understand the danger and consequences that can result from treating each other as competition rather than allies, and have taken important first steps towards creating more harmony in their messages and their goals. That said, most agree that there is always room for improvement.
Unraveling the Dynamics
The very characteristics that define the biorefining industry are a big part of the reason so many trade organizations are necessary. “Given that there are so many innovative technologies, and so many different types of advanced biofuels and biobased chemicals from distinct feedstocks, it’s natural that there would be a variety of organizations representing different sectors,” says Mary Rosenthal, executive director of the Algal Biomass Organization. “Each technology and each feedstock—whether corn, vegetable oils, cellulosic materials, municipal solid waste, algae and so forth—has unique characteristics, challenges and opportunities that make multiple trade groups necessary.”
The fact that each biorefining sector has grown over a different timeline is also a factor. “I think when you look at the biofuels industry, you have to look at it from a historical context,” says Michael McAdams, president of the Advanced Biofuels Association. “Ethanol was the only biofuel in the '80s and '90s.” Organizations such as RFA developed during that time to support ethanol, so it makes sense that this is where their focus remains. Rather than seeing first-generation fuels as competition, it is important to note that those companies and their respective trade organizations are the ones who have laid the groundwork for advanced and cellulosic fuels. “If you would not have the [RFA], I don’t know that you would have had the ethanol policies that you have in this country right now,” McAdams says. “My hat is off to Bob Dinneen and the job RFA has done over the past 20 years to create a viable first-generation ethanol industry.”
However, when an existing statute base has been around for 25 years, there are some challenges when it comes to altering those statutes to accommodate new fuels and new technologies, McAdams continues. It is important to note that each trade organization is simply trying to advocate for what it thinks is best for its members. With 14 billion gallons of corn ethanol already in production, those in the second- and third-generation sectors often argue those resources should be redeployed to help support their development in the same way they were used to support the development of first-generation fuels in the past. Conversely, however, organizations serving first-generation interests want to see those incentives and resources continue to support their members, through either maintaining current policies or redeploying those resources to develop infrastructure.
“That is a natural tension,” McAdams says. “There is a natural tension that the biofuels industry has because they are competing with each other, and they are offering different products with different performance mechanisms. If I’m making a drop-in molecule, I want help building my first-of-kind plant. If I’m making a corn ethanol molecule, I want to grow my current market by establishing infrastructure. Those objectives don’t necessarily align. It’s problematic.”
Many of these tensions are a direct result of the mission-oriented disconnect between different components of the biorefining industry. “Every organization has its own charter and its dues-paying members expect the organization to work on their behalf,” Rosenthal says. “I believe it’s possible to not only support our members’ expectations, but collaborate with the biofuels ecosystem to achieve a favorable policy environment that benefits us all.”
In truth, the vast majority of damage from those competing messages seems to be unintended. “We’ve said things without appreciating our brethren,” McAdams says. “We’ve confused people, and much of it may have been unintended. Not out of malice, but just out of trying to do the right thing for the sector they know, and not understanding the impacts it had on the broader biofuels industry. Maybe we’ve had the unintended effect of confusing people and pitting ourselves against each other when we need to come together.”
Growth Energy CEO Tom Buis notes that sometimes competing messages can be a good thing, as long as those messages don’t confuse Congress and result in inaction. “Differences of opinion are often helpful,” he says. “There are a lot of different voices out there, but I think people work together where they can. Where there are differences, we try to work those out for the best of the industry. When you have differences of opinion—of how you get somewhere, what the goal is, and different opinions on how you can get there—that can sometimes get very confusing to policy makers. That’s why you have to just keep working hard to make sure that everyone has the same goal, and work out your differences on how you get there.”
The real challenge is getting people to actually work together to create concrete solutions. While competition is good in the marketplace, it’s not always productive in the arena of policy. “Convincing a large number of segmented and fractionated trade groups to agree and work together on issues is incredibility difficult,” says National Biodiesel Board CEO Joe Jobe. “However, that is precisely what is necessary in order to have policy and other successes with limited resources. The overall universe of biorefining products is relatively small, and mostly in emerging stages of development. Yet, those limited resources are scattered among dozens of disunited trade groups independently pursuing duplicative—or even contrasting—goals and messages. One of the natural tendencies is for individual groups to differentiate their products by publically touting its benefits compared to other specific bioproducts. The end result is that bioproducts trade groups often work against each other when they should be working together. While various technologies should complete in the markets on the merits and strength of individual precuts, it is essential that at this stage in our collective development, we pull together to face the enormous challenges before all of us.”
According to Brent Erickson, executive vice president of industry biotechnology at the Biotechnology Industry Organization, the multitude of voices in the biorefining arena is both a blessing and a curse. “It’s really a two-edged sword,” he says. “On the negative side, we sometimes have disparate voices with different points of view, and that’s kind of confusing to Congress. On the positive side, we actually have more voices where we do have common policy goals, and a louder chorus calling for Congress to support those.”
The nature of competing goals is problematic for the industry, and a challenge that must be overcome, McAdams says. The process of developing new federal policy objectives can be murky, and compromise is the key. When it comes to policy, the first- and second-generation sectors of the industry are too often seen as working against each other. “They are kind of at odds with each other, and we need to work together to be more harmonious to support our first-generation brethren—stand on the shoulders of our first-generation brethren and deliver the promise of a second-generation advanced and cellulosic industry. That is what really needs to happen here.”
The solution is simple, McAdams says. “Not everybody gets what they want, and we sit down and try to have a holistic conversation where people become reasonable,” he says. “We protect the first-generation assets that have been built, which are key to national security and backing out foreign crude, and help realign the resources that are left to try to jump-start the future industry. But there has got to be give and take amongst these various trade organizations. They’ve got to work together, not against each other.”
Erickson notes that the industry needs to adopt what he calls the “Ronald Regan principle.” “Ronald Regan said no Republicans should speak ill of other Republicans, and I think in the biofuels space we would all adopt the rule that no biofuels company or association ought to speak ill of other biofuels technologies, fuels, molecules, or processes,” he says. “United we stand; divided we fall. We have enough external challenges and enemies, we don’t need internal ones. I think we need to stay unified. I think when the economy turns down and resources become scarce, people tend to become hypercompetitive. I’m not sure that’s always positive. We need to be really careful about how we talk about each other—especially in public.”
Rosenthal agrees that those in the biorefining industry need to start seeing each other as allies rather than competition. “We believe strongly that when it comes to advanced biofuels, a rising tide lifts all boats,” she says. “We believe that by partnering with other trade groups, we can better leverage our collective resources, educate policymakers and the public, and promote the industry. I think we all recognize that a unified front is needed to ensure success for the whole industry. Regardless of feedstock or technology, we must work together to help policymakers understand the benefits of domestic and renewable fuels. It’s important that everyone understand that we are contributing to job creation and reducing our dependence on foreign oil.”
As the industry continues to mature, these objectives might come together in a natural way. “Our overarching guiding principle is that we want to establish a biobased economy, and part of the way we have a biobased economy is to have biorefineries,” Erickson says. “We want to see the development of integrated biorefineries that are like oil refineries, where you take in agricultural feedstocks and make multiple products, not just fuels—fuels, chemicals and plastics. I would hope that all the biotech associations could rally around that concept, because that’s the future. That’s where we need to go, and that enables people to agree.”
Author: Erin Voegele
Associate Editor, Biorefining