Beyond 2020, more advanced biofuels—with higher energy content and greater compatibility with the existing transportation-fuel infrastructure—might become available. However, additional research, development, and demonstration will be required to ready these technologies for widespread commercial deployment.

By 2035, cellulosic ethanol and coal-and-biomass-to-liquid fuels with CCS could replace 1.7–2.5 million barrels per day of gasoline equivalent—about 12–18 percent of the current liquid fuel consumption in the transportation sector—with near-zero life-cycle CO₂ emissions. Coal-to-liquid fuels with CCS could replace 2–3 million barrels per day of gasoline equivalent (the 2 million barrels per day estimate assumes that some coal is diverted to produce coal-and-biomass-to-liquid fuels)—about 14–21 percent of current liquid fuels consumption in the transportation sector—and would have life-cycle CO₂ emissions similar to those of petroleum-based fuels (Figures 2.11–2.13). However, commercial demonstration of these technologies would have to be started immediately and pursued aggressively to achieve that level of production by 2035. In addition, the annual harvesting of up to 500 million dry tonnes (550 million dry tons) of biomass and an increase in U.S. coal extraction by 50 percent over current levels would be required to provide the necessary feedstock supply for this level of liquid fuel production.

These expanded levels of liquid fuel production could have a range of environmental impacts on land, water, air, and human health. Moreover, the production of liquid fuel from coal would increase CO₂ emissions to the atmosphere unless conversion plants were equipped with CCS. Although CO₂ from the off-gas streams of conversion plants could be readily captured using commercially available technologies, engineered geologic storage of captured CO₂ has not yet been demonstrated at the needed scales. Additional discussion of CCS technologies is provided under Finding 6.

Coal-to-liquid fuel production, with or without CCS, is the least expensive option for producing alternative liquid fuels (less than or equal to $70 per barrel; see Figure 2.14), although such production raises important health and environmental issues, as noted above. Deploying cellulosic ethanol would be economically competitive only with petroleum prices above about $115 per barrel.