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As part of the Obama Administration’s strategic plan for a smarter economy fueled by homegrown and alternative energy sources, the United States Department of Energy will provide up to $15 million to demonstrate biomass-based oil supplements that can be blended with petroleum. The goal is to develop technology that helps the United States to reduce foreign oil consumption, diversify the country’s energy portfolio, and create jobs for American workers.

The DOE reports that these co-called bio-oils are “precursors for fully renewable transportation fuels could be integrated into the oil refining processes that make conventional gasoline, diesel and jet fuels without requiring modifications to existing fuel distribution networks or engines.”

Secretary of Energy Steven Chu explains, “The Energy Department’s investments to develop renewable transportation fuels are a key part of the Obama Administration’s all-of-the-above energy strategy to develop America’s domestic energy resources and reduce our nation’s dependence on foreign oil. Driving innovation through targeted investments helps to speed development of next-generation biofuels made in America, biofuels that will help to protect American families and businesses from the ups and downs of the global oil market.”

The Department plans to fund between five to ten projects in fiscal year 2012 to produce bio-oil prototypes that can be tested at oil refineries and used to develop comprehensive technical and economic analyses of how bio-oils could work. The proto-type bio-oils will be produced from a range of potential feed-stocks including algae, corn, and wheat stovers, dedicated energy crops or wood residues. Domestic industry, universities, and laboratories are all eligible to apply for the grants.

The results of the projects will inform future efforts to promote bio-oil technologies and bring the technology to market. A description of the funding opportunity, eligibility requirements, and application instructions can be found on the Funding Opportunity Exchange website under Reference Number DE-FOA-0000686.

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