Navy Energy Official Predicts Success With Biofuels

By Matthew Mientka

The U.S. Navy this week criticized a major think-tank for a jaundiced outlook on the development of alternative fuel technologies and markets.

Tom Hicks, deputy assistant secretary of the Navy for energy, told reporters that a report from the non-profit Rand Corporation to Congress this week contained “misrepresentations and some factual errors,” particularly with regard to Navy development of new fuels.

The Rand Corporation failed not only to consult the Navy but with industry, Hicks said. And “based on [our] active engagement with industry, we have come to some far different conclusions.”

The Rand report erroneously describes the Navy as operating a testing program for a petroleum substitute used to make low-sulfur diesel fuel, whereas the service focuses exclusively on biofuels, Hicks said. The think-tank also fails to link the development of alternative fuels to national security and downplays the possibility government and industry would succeed in making such fuels practical.

Yet, the Navy came to a starkly different conclusion after speaking with other government agencies and the Energy Department, corporations and the venture capitalists who fund them, Hicks said. For one thing, the American military wields sufficient purchasing power to sometimes drive market realities, increasing the chances of developing new fuels in sufficient quantities at the right price. Though the military represents only 2% of the U.S. petroleum market, the services would likely drive market trends given the anemic finances of America’s largest oil user—the commercial aviation industry.

In fact, the Navy intends to soon drive down the price of fuel to a dollar per gallon.

The Navy official also emphasized that new energy would allow America to regain its energy independence while stopping the transfer of wealth to oil-rich countries sometimes hostile to U.S. interests.

“We’ve been focused since October on a range of [energy] issues, most notably… that by 2020, 50% of our fuel will come from alternative sources,” Hicks said. “I think we’re looking at this maybe in a broader context… from an energy independence and energy security point of view.”

The Navy predicts the maturation of the biofuels market within the next five years.