By Jeff Mason
WASHINGTON (Reuters) - President Barack Obama on Wednesday will outline a government strategy to boost development of U.S. biofuels and address their environmental challenges, an administration official said.
The strategy will be laid out in a report by the Biofuels Interagency Working Group, a body the president established to help spur investment in biofuels and make the industry more environmentally friendly.
Obama and members of his Cabinet are scheduled to meet on Wednesday with a handful of state governors to discuss energy policy and the "opportunities and challenges presented by the transition to a clean energy economy," the official said.
The president is pushing for the United States to overhaul its energy habits by switching to less-polluting fuels and reducing its dependence on foreign oil.
Coinciding with Obama's announcement, the U.S. Environmental Protection Agency also could issue new rules on measuring carbon dioxide emissions from biofuels such as ethanol.
Under a 2007 energy law, ethanol made from corn must emit less of the main greenhouse gas, carbon dioxide, than gasoline over the life cycle of the fuel, from production to being burned. Cellulosic fuels, made from crop waste and the woody bits of nonfood crops, would have to be even cleaner.
The struggling biofuels industry is concerned that the Obama administration will move too quickly away from ethanol, which is mostly made from corn, to more difficult techniques using wood chips and other biomass.
ENERGY INDEPENDENCE
Boosting production of home-grown biofuels such as ethanol would help achieve more energy independence while also creating jobs in rural regions of the United States as the country battles double-digit unemployment, the administration argues.
Obama's push for ethanol could also shore up his support in farm states where ethanol helps support demand for corn.
The president may touch on other energy policies such as technology for capturing and storing carbon emissions during the meeting with governors.
Since his State of the Union Address, the president has been embracing a range of fuel alternatives including nuclear and clean coal technology in a move likely to win support of some wavering Democrats in coal states and Republicans.
Some expect that Obama will seek to lump the energy initiatives in a climate change bill in order to win broad bipartisan support for a bill to reduce U.S. greenhouse gas emissions.
Obama charged the biofuels working group, which includes the leaders of the Department of Agriculture, Department of Energy and the Environmental Protection Agency, with retooling the nation's policies toward biofuels in many areas.
The group was asked to develop a strategy to increase biofuels production, investment in the industry, and the use of "flex fuel" cars, which can run on either gasoline or fuel that is mostly ethanol.
Biofuels, which are made from biomass -- organic matter such as wood, crops and animal waste -- are used to power vehicles, but critics do not see them as the perfect replacement to high-polluting fossil fuels.
Environmentalists and some scientists say production of U.S. biofuels from corn and other grains can drive out production of other crops, forcing farmers in other countries to burn down forests and clear land to grow those crops -- creating new sources of carbon dioxide, a greenhouse gas blamed for global warming.
(Additional reporting by Timothy Gardner, editing by Will Dunham)
