This thesis presents three catalysts for the origins of the Department of the Navy's biofuel initiative: (1) Section 526 of the Energy Independence and Security Act of 2007 effectively ended the Department of Defense s (DoD s) research program into synthetic fuels derived from fossil fuels; (2) the crude oil spot price reached a maximum daily price of $145.16 on July 14, 2008; and (3) the American Recovery and Reinvestment Act of 2009 appropriated over one billion dollars for biomass research and development. Although cost volatility has impacted the DoD s budget, the DoD already has used the Defense Working Capital Fund to make perceived oil prices less volatile to DoD users. Drop-in replaceable biofuels would not remove petroleum price volatility because biofuels act as close substitutes. The governments of other countries reduce cost volatility by managing fuel price risk using futures contracts; opinions differ on whether the DoD should pursue this option. To mitigate cost volatility, the Defense Business Board recommended exploring intragovernmental transfers between the DoD and Department of the Interior on two occasions. Long-term contracts could reduce volatility, but the DoD risks losing competitors in supply.

Combustion of biomass has been used by industry to produce steam and power for many years, but new technologies are being introduced to better recover the energy from biomass as well as to produce a synthetic gas (syngas) that can be used as a starting point in the production of automotive and diesel fuels as well as higher value chemicals. It is of significance that operating temperatures in combustion and gasification systems are often restricted by materials limitations resulting from the degradation of materials in the highest temperature areas. For systems recovering heat and/or generating steam, operating limits are often imposed by degradation of the superheater tubes that recover heat from the combustion gases at the highest temperatures. The steam temperature of biomass fueled boilers is limited by high temperature corrosion of superheater alloys in the ash deposit/flue gas environment. During visits with European researchers and boiler manufacturers and operators, it was learned that advanced European biomass boilers combine design modifications, process changes and corrosion resistant alloys to achieve substantially higher steam temperatures and efficiencies than U.S. biomass boilers. Design modifications to reduce superheater corrosion include adding an empty pass between the furnace and the superheater, installing cool tubes to trap low melting temperature chlorine deposits ahead of the superheater, heating the final superheater in the recirculated fluidizing medium of a circulating fluidized bed boiler, operating with a slagging superheater, designing superheaters for quick replacement, raising the superheater temperature above the dew point of the most corrosive deposits and installing an external superheater fired by a less-corrosive fuel. Process changes include diluting corrosive biomaterials with less-corrosive fuels, adding high sulfur fuels to convert alkali chlorides to lower melting temperature sulfates before they reach the superheater, washing chlorides out of agricultural residues and adding chemicals that convert alkali chlorides to aluminosilicates.