Biofuels such as ethanol and biodiesel have grown from niche fuel additives found primarily in the Midwest to worldwide competitors with gasoline and diesel. As production of these alternative fuels has increased, the role that biofuels play in solving global warming, improving national security and helping the environment has increasingly become a topic of debate. Below is a summary of the major issues:

• Listen to NPR's All Things Considered podcast on the implications of the recent Science studies on ethanol.

  Effect on Climate Change: Although previous studies had shown that almost all biofuels result in a net reduction in greenhouse gases, new studies published in Science have cast doubt on this claim. The first study argues that diverting land from food production to fuel production leads farmers to cut down carbon-rich rainforest and plow up wilderness or fallow land in response to the reduced supply of food commodities like corn and soybeans. It argues that a full accounting of the “life-cycle” greenhouse gas effects shows that most conventional biofuels lead to greater greenhouse gas emissions than even gasoline or diesel.
  
  A second study confirms that conventional biofuels are likely to increase greenhouse gas emissions more than gasoline or diesel, but that next generation biofuels made from waste products or algae may ultimately prove to be a part of the solution to climate change.
  
  Biofuel advocates dispute these studies, arguing that it is difficult to attribute increased deforestation solely to an increase in demand for biofuels, and that yield increases will offset some of the demand for new land for agriculture. The Renewable Fuel Standard in the Energy Independence and Security Act of 2007 (the energy bill) contains safeguards that require biofuels to perform better than gasoline or diesel fuel in terms of lifecycle greenhouse gas emissions.

• Effect on Fuel Imports: As ethanol and biodiesel use grows in the U.S., it has reduced demand for fossil fuels. When paired with increases in auto fuel efficiency (such as those passed in the Energy Independence and Security Act of 2007) and reductions in vehicle miles traveled, increased use of ethanol and biodiesel have the potential to contribute to overall reductions in fossil fuel imports. For example, according to the Renewable Fuels Association, ethanol production reduced U.S. oil imports by 170 million barrels in 2006.
  
  On the other hand, much of the ethanol produced in the U.S. has not replaced conventional gasoline, rather it is used to replace MTBE, a once-ubiquitous gasoline additive that is being rapidly phased out due to concerns over its role in polluting groundwater supplies. Moreover, despite a large tariff on imported ethanol, U.S. refiners imported over 17 million barrels of ethanol from other countries in 2006.

• A hypoxic "dead zone" in the Gulf of Mexico continues to grow as a result of contamination and runoff.

  Effect on Water Resources: Several studies in recent months have called attention to the potential for adverse effects on water quality and quantity from increased production of biofuels. Corn and soybeans are the principal feedstocks of the current generation of biofuels. As demand for these biofuels has grown, corn and soybean production has increased to match demand, resulting in greater risk of nutrient runoff and soil erosion (PDF). In addition, these studies show that growing crops for biofuels production requires large amounts of water, which must be diverted from rivers or aquifers that may already be depleted (PDF). Although the Renewable Fuel Standard in the 2007 Energy Bill does not contain any protections to ensure that water quality and supply issues are addressed, AFT is working to reduce the impact on water resources by helping farmers implement better nutrient and soil management practices and by fighting for more conservation funding in the farm bill.

• Effect on Wildlife: Domestic and international groups have raised concerns that cultivation of feedstocks for biofuels is destroying wildlife habitat and harming endangered species. Specifically, Indonesian palm oil plantations and Brazilian sugar cane farms are blamed for destroying rainforest and other habitat that are critical to hundreds of endangered species. Meanwhile, surging domestic demand for corn and other grains, due partly to growing biofuel production, is threatening fish and wildlife habitat across the United States. Conservation programs in the farm bill could help mitigate this effect. Moreover, special protections for wildlife that are written into the current Renewable Fuel Standard will be critical to ensuring biofuel production does not damage vital ecosystems.

• Effect on Food Prices: As demand grows for corn and soybeans to produce biofuels, consumers of corn products have seen prices rise in response to the scarcity of corn and other grains. In addition, livestock producers have been forced to adjust to higher feed costs. However, the Renewable Fuels Association points out that the observed increases in food prices have been caused mostly by increased fossil fuel prices rather than by increasing demand for ethanol and biodiesel.