The Navy – along with its newest ally, the Agriculture Department – announced Monday that they are purchasing nearly a half-million gallons of biofuels for an air-sea military exercise next summer. “Our use of fossil fuels is a very real threat to our national security, and to the U.S. Navy’s ability to protect America and to project power overseas,” Navy Secretary Ray Mabus said.
A quick jog around the calculator shows the deal is costing the government about $26.66 a gallon for the biofuel alone. “You look at it blended with the 50-50 blend of petroleum, we’re going to end up paying about $15 a gallon for the demonstration that we use,” Mabus said. “This is still [an] R&D purchase – it’s half of what we were paying this time last year. And it shows that as the market develops, you’re going to see costs come down.”
Mabus and Tom Vilsack, the ag boss, said they are buying 450,000 gallons of fuel – for $12 million – from Solazyme and Dynamic Fuels LLC, a joint venture of Tyson Foods, Inc. and the Syntroleum Corporation. Solarzyme’s fuel is derived from algae, and Dynamics comes from used cooking oil and animal fat not suitable for food. Mabus added that the fuels, his latest push for a “Great Green Fleet,” can be used without engine mods.
The deal marks the largest government purchase of biofuel in history, and will be used to power a carrier battle group during next summer’s maritime operation off Hawaii (the carrier is nuclear powered, but the other vessels – and the aircraft based on the carrier — will be using a 50-50 mix of biofuel and standard petroleum products).
The Navy has long been a trendsetter in this area, Mabus noted. “We went from sail to coal in the 1850s, we went from coal to oil in the early part of the 20th century, and we pioneered nuclear in the 1950s.” he said. “And we’re going to lead once again by helping establish a market for biofuels.”