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With crude oil price projected to top $140 per barrel by 2035, alternative fuel technologies, which can produce gasoline at the equivalent of $75 per barrel, will rise, according to a Lux Research report. Bringing the Heat: Gas- and Waste-derived Synfuels , says the price disparity between crude oil and other resources — coupled with the emergence of cheap and abundant shale gas, especially in the US — is transforming the alternative fuels landscape, opening up opportunities to produce cheaper gasoline. Natural gas and waste biomass will become increasingly viable choices for making liquid fuels, says Daniel Choi, a research associate at Lux Research and the lead author of the report. Lux Research analysts studied the cost of 21 biomass-to-liquids (BTL) and gas-to-liquids (GTL) processes. Among their findings: Methanol-to-gasoline is the cheapest option. At small scale (about 1,000 barrels per day), methanol-to-gasoline (MTG) is the most competitive route for liquid fuels from either natural gas ($82 per barrel) or waste ($75 per barrel). GTL can make ethanol more cheaply, but offers limited product value. Among GTL approaches, ethanol synthesis has the lowest cost of $80 per barrel, while Fischer-Tropsch costs $86 per barrel and MTG costs $82 per barrel. However, ethanol has less product value, due to blending limits and lower energy density. Waste biomass is a ubiquitous alternative. The Energy Department says waste biomass could produce 50 billion gallons of ethanol, roughly 3.5 times the current production. Processing the waste is challenging, adding $3.60/bbl to the fuel price — but that’s often more than offset by feedstock cost savings. In other alternative fuels news, Alaska Airlines earlier this week said it will begin using biofue l to power its Hawaii flights as soon as 2018 and Gevo has begun supplying the US Coast Guard research and development center with initial quantities of finished 16.1 percent renewable isobutanol-blended gasoline for engine testing. Alternative fuel developers face a make-or-break year as leading companies, such as Amyris, Poet, Solazyme, Gevo, Novozymes and Mendel , race to show substantial revenue, according to a report by Lux Research published earlier this year. Continue reading →