Today, U.S. Navy Secretary Ray Mabus and U.S. Department of Agriculture Secretary Tom Vilsack announced that the Defense Logistics Agency signed a contract to purchase 450,000 gallons of advanced drop-in biofuel, the single largest purchase of biofuel in government history. While the Navy fleet alone uses more than 1.26 billion gallons of fuel each year, this biofuel purchase is significant because it accelerates the development and demonstration of a homegrown fuel source that can reduce America's, and our military's, dependence on foreign oil.
The Defense Department will purchase biofuel made from a blend of non-food waste (used cooking oil) from the Louisiana-based Dynamic Fuels, LLC, a joint-venture of Tyson Foods, Inc., and Syntroleum Corporation, and algae, produced by Solazyme. The fuel will be used in the U.S. Navy's demonstration of a Green Strike Group in the summer of 2012 during the Rim of the Pacific Exercise, the world's largest international maritime exercise.
As part of his energy security goals, outlined in March 2011 in the "Blueprint for a Secure Energy Future," President Obama directed the Departments of Agriculture, Energy and Navy to work together to advance a domestic industry capable of producing "drop-in" biofuel substitutes for diesel and jet fuel. Responding to that challenge, in August 2011, the Secretaries of Agriculture, Energy and Navy announced an intention to invest up to $510 million during the next three years in partnership with the private sector to produce advanced drop-in biofuel to power military and commercial transportation. While that investment awaits Congressional action, today's announcement uses the existing authority – leveraging Defense Department procurement – to support this energy security goal.
"The Navy has always led the nation in transforming the way we use energy, not because it is popular, but because it makes us better war fighters," stated Secretary Mabus. "This unprecedented fuel purchase demonstrates the Obama Administration's commitment to seeking energy security and energy independence by diversifying our energy supply."
"In March, the President challenged me, Secretary Mabus, and Secretary Steven Chu to work with the private sector to cultivate a competitively-priced—and domestically produced—drop-in biofuel industry that can power not just fighter jets, but also trucks and commercial airliners," said Secretary Vilsack, "Today's announcement continues our efforts to meet that challenge. This is not work we can afford to put off for another day."
The biofuel will be mixed with aviation gas or marine diesel fuel for use in the Green Strike Group demonstration. It is a drop-in fuel, which means that no modifications to the engines are required to burn the fuel. Its cultivation did not interfere with food supply and burning the fuel does not increase the net carbon footprint. In preparation for this demonstration, the Navy recently completed testing of all aircraft, including F/A-18 and all six blue Angels and the V-22 Osprey, and has successfully tested the RCB-X (Riverine Command Boat), training patrol craft, Self Defense Test Ship, and conducted full-scale gas turbine engine testing.
DLA will pay half the price for the Green Strike Group biofuel than it paid for biofuel for testing in 2009. Increased demand will likely continue this trend toward more cost-effective biofuel. Renewable jet fuel produced by Dynamic Fuels has already been used in regularly scheduled commercial airline flights by KLM Royal Dutch Airlines, Finnair, Thomson Airways, and Alaska Airlines.
"This contract clearly demonstrates that we're building momentum for the continued commercialization of advanced renewable fuels production here in the U.S.," said Andy Rojeski, a management committee member for Dynamic Fuels, a joint venture between Tyson Foods, Inc. and Syntroleum Corporation. "We believe the federal government's commitment to procure more energy from renewable sources will help make our high performance, environmentally friendly fuel more cost competitive, potentially creating more jobs in the biofuels industry."
"This historic contract is a major step forward for America's energy security and the advanced biofuel industry in our country. Solazyme has delivered more than 360,000 liters of 100 percent algal derived renewable diesel to the U.S. Navy for their fuel certification program to date. The United States leads the world in advanced biofuel technology, and the Departments of Agriculture, Energy and the Navy have been instrumental in coming together to spur commercialization and grow our lead," said Jonathan Wolfson, CEO, Solazyme. "We are honored to be working with the U.S. Navy and DLA-Energy in driving forward the Navy's effort under Secretary Ray Mabus to source 50 percent of its energy from renewable sources by 2020. And we are proud to be teaming up with Dynamic Fuels on this contract."