By Sandra I. Erwin

Congress is seeking to ban the Defense Department from purchasing alternative fuels that cost more than petroleum-based products. These restrictions, however, will not end U.S. Air Force efforts to test and research alternative fuels, officials say.

The House and Senate last month approved a series of anti-biofuel amendments to the fiscal year 2013 National Defense Authorization Act that still await consideration by a conference committee sometime this summer.

The legislation, which has been widely interpreted as a major setback for the military’s green-energy agenda, prohibits large-scale purchases of alternatives until they achieve cost parity with fossil fuels.

Terry Yonkers, assistant secretary of the Air Force for installations, environment and logistics, says the restrictions are reasonable, considering the budget crunch that confronts the Defense Department. But he notes that Congress is not outlawing research and certification programs, which will continue. The Air Force, as well as the Army and the Navy, have been testing since 2007 the performance of military aircraft when powered by a 50/50 mix of conventional JP-8 and alternative fuels, and certifying several types of airplanes to fly on synthetic or biofuel. The Air Force will invest in small quantities of experimental biofuels so it can certify more airplane types and prepare the fleet to, one day, transition to full-blown use of alternative fuels when prices fall, Yonkers says June 13 at a Pentagon news conference.

The NDAA language might lead the casual observer to believe that the military is ready to ditch petroleum and pour billions of dollars into cleaner fuels. But that is a long way from reality. The Air Force, for instance, has purchased anywhere from 100,000 to 500,000 gallons of biofuels a year for research, compared to its annual buy of 2.5 billion gallons of jet fuel.

Yonkers equates the current state of biofuels to the early generations of consumer electronics that were sold at premium prices. “We expect biofuels will get cheaper,” says Yonkers, “perhaps within a four-to-five year timeframe,” if they reach commercial scale.

The fleet certification program requires relatively small quantities of biofuels, and will still be allowed to carry on, despite the NDAA stipulations, says Yonkers. “We want to be able in the next two to three years to take advantage of whatever fuels are produced in the private sector.” The amendments might slow down but will not derail these efforts, he says. “I don’t see any issue here.”

Yonkers says biofuels are important to the Air Force’s future not just as a means to reduce dependence on imported oil but also as aircraft performance enhancers.

Studies under way at the Air Force Research Laboratory so far have revealed that biofuels, because they weigh less, burn cooler and cleaner than conventional jet fuel, boost the efficiency of engines, and reduce metal fatigue, says Yonkers. Over time, that cuts down on fleet wear and tear, and adds up to cost savings, he says. “But we have to finish the research first.”

Promising research notwithstanding, the Defense Department’s biofuels program faces an uphill climb.Several House Republican lawmakers have vowed to strike budget requests for biofuels. They have been particularly irate at the Navy’s “great green fleet” project to deploy by 2016 an aircraft carrier battle group powered by alternative fuels. The Navy spent $12 million on 450,000 gallons of biofuel to power a carrier strike group off the coast of Hawaii earlier this year. Critics have seized on the $26 per gallon — or $16 per gallon if mixed with JP-8. Green energy groups have pointed out that the prices, although much higher than petroleum, have dropped considerably over the past several years.

The Pentagon has proposed a $170 million investment in biofuels under the authority provided by the Defense Production Act. The DPA allows the Defense Department to help jumpstart a domestic industry whose products are needed by the U.S. military. An August 2011 agreement between the Navy, and the Departments of Agriculture and Energy commits each agency to up to $170 million — with additional cost sharing from industry.

Sharon E. Burke, assistant secretary of defense for operational energy plans and programs, has defended the use of the DPA as a legitimate vehicle for investments in alternative sources of energy. “As one of the world’s largest consumers of petroleum fuels, DoD has an interest in the development of alternatives as a hedge against potential supply disruptions and future price volatility,” she writes in a White House blog post. The Pentagon spent about $15 billion on petroleum-based liquid fuels in 2011.

A Congressional Research Service study deals the Defense Department’s biofuels plan a dose of reality. “It is not clear whether developing advanced biofuels would provide the Navy (and the nation) with much protection against volatility in petroleum-based fuel prices,” the study says. “Since advanced biofuels are intended to be drop-in substitutes for petroleum-based fuels, providers of cost-competitive advanced biofuels might simply adjust their prices up and down to match changes in prices for petroleum-based fuels.”

A different way to insulate the Defense Department from short-term volatility in petroleum-based fuel costs, CRS analysts suggest, would be to purchase fuel, as commercial airlines do, through multiyear contracts that lock in prices over the term of the contract. The study also notes that the Navy’s more aggressive push to boost domestic biofuels production is inconsistent with the Air Force’s more conservative approach.