From an article in Financial Times Asia-World edition it is clear that “China is gearing up for a massive investment in a homegrown fuel source to cut its growing reliance on imports - plants to turn coal into gas and oil…China's central planners have on their desks proposals for at least 24 billion USD worth of large-scale coal-to-liquids projects, with a number of pilot plants already under construction in Inner Mongolia and other coal-rich provinces”. In the fall of 2006, a later US edition of the Financial Times, reported that “Beijing sets national standard for methanol as automotive fuel.” By the time these plants, which convert coal to liquids, start producing in 2011 to 2013, China's oil demand will have doubled, allowing methanol to supply about 10 per cent of the market." CTL is only going to be part of China’s emerging energy solutions and biomass alternatives must be considered as viable options.

The National Development and Reform Commission (NDRC) has recently addressed the competition of biomass fuel alternatives with China's increasing food demand by stating, “Critics of ethanol say it is inappropriate to use corn to make fuel at a time when China is struggling to keep precious agricultural land in production to ensure "food security" for the country”. Therefore, other biomass resources are being investigated that do not impinge on food security issues, especially for rural provinces with growing fuel demands.

Recent projections indicate that the US could feasibly satisfy 25% of its energy demand from renewable fuels, and given the increased food demand that will follow the burgeoning world population, what will satisfy the remainder of our transportation needs by 2050? Cellulose is certainly the most popular current bet for investors and government research grants.

Project Objectives
In 2006, the Renewable Energy Institute International (REI International) and Tsinghua University’ Institute of Nuclear and New Energy Technology (INET), with support from the National Science Foundation through the University of California Office of the President, initiated a collaborative research initiative entitled “A Comparative “E5” Assessment of Electric Power and Alternative Fuels Derived from Renewable Biomass and Coal Resources in China and the United States”. This is part of a larger NSF funded initiative called “Partnerships in Innovation: Building on Interactions with China in the Areas of Energy, Environment and Education”. The objective of this project is to carry out comparative “5E” assessments for the conversion of renewable biomass and coal to energy and fuels. Several conversion technologies with the highest commercial potential are compared with respect to economic (E1) viability, energy (E2) efficiency, environment (E3) impact, technology evaluation (E4) (e.g. reliability and safety), and the most effective (E5) approach in terms of socio-political acceptance. The E1, E2 and E3 assessments are being carried out using a life-cycle assessment (LCA) approach. The E4 assessment evaluates progress of the Research, Development, Demonstration and Deployment (RDD&D) stages of each candidate technology. The E5 assessment evaluates selected socio-political factors such as government regulations, societal benefits, stakeholder objectives, environmental stewardship, and stakeholder needs and concerns. Due to socio-economic complexities, the E5 assessments are often problematic and controversial. This last assessment will be carried out in Phase II of this project.