Coal-to-liquids and gas-to-liquids fuels are produced by manipulating the hydrocarbons in non-oil fossil fuels so that they are chemically similar to the hydrocarbons in oil and gasoline. Biomass-to-liquids fuels work according to the same theory, except that the hydrocarbons come from freshly dead organic material, not organic material that has been decomposed and compressed over millions of years. BTL fuels can be made from wood, crops, straw and grain. The advantage of BTL is that it can be made from parts of those plants that are not useful for food or manufacturing.
The production process is similar to other synfuels: Syngas is used to start a Fischer-Tropsch reaction that eventually produces liquid fuels. The biomass is burned in a low oxygen environment to produce syngas, a step that requires less energy than other synfuels. But it takes comparatively large quantities of biomass feedstock (the raw material that is synthesized) to make fuel. Five tons (about 4.5 metric tons) of feedstock (or approximately 3 acres or 1.2 hectares of crops) equal 1 ton (0.9 metric tons) of manufactured BTL [source: U.S. Energy Information Administration]. BTL also costs much more money to produce than CTL or GTL. Biomass takes up much more space than other synfuel feedstocks, so it costs more to store and transport. BTL is not nearly as widespread as other forms of synfuels, which means companies would have to invest a lot of money to get BTL programs up and running. Despite the cost, BTL could be easier on the environment in the long run, since plants grown to produce the fuel could cancel out some of its CO2 emissions.