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Abstract

Prospects for the cellulosic biofuel industry are unclear. The EPA has repeatedly lowered production requirements under the Renewable Fuels Standard (RFS-2) to reflect the limited investment in cellulosic biorefineries. The elimination of the VEETC tax credit and of the import tax for Brazilian ethanol at the end of 2011 leave the domestic biofuel industry, particularly advanced biofuels not yet as established as corn ethanol, more exposed to competitive pressures from international commodity markets. The R&D focus seems to be shifting from cellulosic ethanol to drop-in biofuels, which would eliminate the need for infrastructure investments in the downstream segment of the supply chain. However, the challenges associated with handling biomass and configuring a network of biorefineries and biofuel transportation routes remain, regardless of biofuel type. The BioTrans model offers a tool for long-term planning that takes into account strategic interactions among regions and between oil and biofuels while also examining system flexibility and robustness to supply/demand shocks.

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