My Big Biofuels Bet
The road to energy independence starts in a cornfield in Nebraska. Venture capitalist Vinod Khosla explains why heâ€™s betting on biofuels.
IT MAY SURPRISE YOU TO learn that the most promising solution to our nationâ€™s energy crisis begins in the bowels of a waste trough, under the slotted concrete floor of a giant pen that holds 28,000 Angus, Hereford, and Charolais beef cattle. But for some time now, Iâ€™ve been searching for a renewable fuel that could realistically replace the 140 billion gallons of gasoline consumed in the US each year. And now I believe the key to producing this fuel starts with cow manure â€“ because this waste powers a facility that turns corn into ethanol.
Iâ€™m standing on a grassy hill in the middle of an 880-acre commercial feedlot just outside Mead, Nebraska, which is a long way from my home turf of clean labs and wood-paneled conference rooms in Silicon Valley. In front of me are four open-air cattle sheds. Each is the width of a giant barn and a full half-mile in length. From up here, they look more like jumbo-jet landing strips than animal pens. Beyond the sheds are several hundred acres of cornfields, from which much of the animalsâ€™ feed is harvested.
It may look like a typical, if huge, cattle feedlot â€“ but for the glittering white four-story structure below that resembles the Centre Pompidou in Paris. Indeed, until recently this operation just off Meadâ€™s County Road 10 was not unlike any other finishing ground for Nebraskaâ€™s beef cattle: a last stop before the abattoir. But starting in November, Oscar Mayer will no longer be the marquee product here. A company called E3 Biofuels is about to fire up the most energy-efficient corn ethanol facility in the country: a $75 million state-of the-art biorefinery and feedlot capable of producing 25 million gallons of ethanol a year. Whatâ€™s more, it will run on methane gas produced from cow manure. The super-efficient operation capitalizes on a closed loop of resources available here on the prairie â€“ cattle (fed on corn), manure (from the cows), and corn (fed into the ethanol distiller). The output: a potential gusher of renewable, energy-efficient transportation fuel.
Of course, 25 million gallons of ethanol is a drop in the tanker when it comes to our 140 billion-a-year oil habit. And ethanol itself is a subject of controversy for all sorts of reasons. Many of the criticisms, while true in some small ways, are aggressively promoted by the oil lobby and other interested parties in an effort to forestall change. Most are myths. Challenges certainly exist with ethanol, but none are insurmountable, and â€“ with apologies to Al Gore â€“ the convenient truth is that corn ethanol is a crucial first step toward kicking our oil addiction. I believe we can replace most of our gasoline needs in 25 years with biomass from our farmlands and municipal waste, while creating a huge economic boom cycle and a cheaper, cleaner fuel for consumers.