Opinions on the Environment | Vinod Khosla

Vinod Khosla, founder of Khosla Ventures, argues in the Washington Post that there are good and bad biofuels - and that the two should not be lumped together for the purpose of criticism. Cellulosic biofuels can have an environmentally meaningful impact on petroleum use and also benefit farmers, entrepreneurs and consumers. The term 'biofuel' does not refer to a single product or source of alternative fuel. Rather, it refers to various products that can vary dramatically in many ways - for example, in their environmental impact or in their effects on food prices. Mr Khosla admits that biodiesel from food oils like soybean or palm have traditionally resulted in environmental negatives. But, on the other hand, ethanol made from corn has been a 'stepping stone to cellulosic ethanol', which is a preferred alternative and is likely to achieve unsubsidized market competitiveness with petroleum based oil within the next few years. Moreover, Mr Khosla argues, since we face multiple crises (an energy crisis, an environmental crisis, and a terrorism crisis) that are very much related to oil, a serious push to reduce oil consumption, based on results oriented options, is an absolute necessity. Mr Khosla claims, however, that 'high-cost options to reduce consumption', like converting to hybrid and/or electric cars, are unlikely to 'materially reduce carbon emissions' - even though such options might sound good. A meaningful impact based on such attractive sounding options would require that the next 1one billion cars that are manufactured be low-carbon models. By this logic, Mr Khosla has come to believe that the only cost-effective plan likely to achieve widespread market acceptance over next 20 years is one based on cellulosic-fuel cars. We should thus be wary of much of the biofuels criticism that seems to overwhelm us each day. Much of it comes from interested parties, like the Groceries Manufacturers Association; while criticism based on rising food costs is mitigated by the fact only 3 % of more 40+ % in world food prices is due to increased demand of corn for ethanol; and, likewise, criticism based on environmental concerns could be dealt with by incentivizing production of biofuels that are environmentally beneficial - e.g., via a carbon, land, air quality and water (CLAW) impact rating system for all biofuels, 'much like the LEED environmental rating for homes'.