biofuels ― from oil to alcohol addiction?

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Forestr y Program Biofuels ― From Oil to Alcohol Addiction? Sten Nilsson IIASA, Laxenburg, Austria EUROFORENET Conference, Brussels, 20 November 2007

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Biofuels ― From Oil to Alcohol Addiction?. Sten Nilsson IIASA, Laxenburg, Austria EUROFORENET Conference, Brussels, 20 November 2007. Solar Energy. - PowerPoint PPT Presentation

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Page 1: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Biofuels ― From Oil to Alcohol Addiction?

Sten NilssonIIASA, Laxenburg, Austria

EUROFORENET Conference, Brussels, 20 November 2007

Page 2: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Solar Energy Based on the efficiency of biological

collection of solar energy: 4000 m2 of land/person is required for replacement of fossil fuels and nuclear energy in the present world energy system (2080 w/person)

250–700g water is needed for the photosynthesis of 1g of dry biomass

Constraints by available land, water, etc.

Source: Burkhardt (2006)

Page 3: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Bio Resources

All of the products are expected to have future increased demand―with increased demand competition is increasing

Convergence of the markets over time for the products above. Bio raw material will be priced on its energy content

Competition of Resources

Food Production

Forest Industrial

Production

Chemical Industry

HeatElectricity Biofuels

Page 4: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Underlying Forces for Convergence

Economic security (i.e., rising real price of oil)

Environmental security (i.e., climate change)

National Security (i.e., dependence on Middle East/Russia)

Political security (i.e., support for rural development and rural votes)

Concerns related to:

Page 5: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Global Agriculture Production of Biomass (in billion ton BMQ)

1992/1994 2030

Available for Energy

Production in 2030

Grain 2.25 2.80–3.00

Vegetable Oil Production

120 million tons of oil 250 50 million tons

Agriculture Residues

3.35 4.20–4.45 1.30–1.40

Manure 2.50 3.10–3.60 0.85–1.00

Food rests, etc. 1.10 1.95–1.95 1.10–1.10

9.20 12.05–13.00 3.25–3.50

25–30%

Source: Modified from Berndes, et al. (2007)

Page 6: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Forest Biomass

Source: FAO (2006)

435 billion tons of above-ground biomassAvailable for utilization: 5–7 billion tons

ForestOther Wooded LandOther LandWater

Page 7: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Examples of Conversations of Different Types of Biomass to Different Energy Carriers

Ligno cellulose plants, dry(wood from forests and bioenergy forests)

Cellulose rich plants, dry (straw)

By-products from forest industry (sawdust, black liquor)

Sugar and starch rich plants

Wet bio material (pasture, corn, manure, biological waste, drainage)

Oil rich plants (rape seed)

Chips, pellets, etc., combustion for production of heat and electricity

Fermentation to ethanol (first generation)

Hydrolysis and fermentation to ethanol (second generation)

Termic gasification: electricity; Synthetic gases for production of second generation biofuels, e.g., DME, methanol, FT-diesel and methane

Decomposition to biogas―heat, electricity, biofuel

Production of RME (biodiesel, first generation)

Source: Börjesson (2007)

Page 8: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Biomass OpportunitiesBioenergy: Electricity and heat from biomass

Liquid Biofuels for Transportation: Examples are ethanol, methanol, FT-diesel, RME (rape methyl ester), DME (dimethyl ether)

Biogas―An in-between Biofuel: Can substitute natural gas and feed into existing natural gas pipeline systems; Can also be processed into a gas-to-liquid

Hydrogen: Can be produced from biomass and coal third generation of fuels)

?

Page 9: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Biorefinery

BioethanolEsterification

Methanol

Herbaceousbiomass

Torrefaction

Biomasspre treatment

Oil/sugarseparation

Flash pyrolysis

Syngas Production

SynthesisBiodiesel

DME

Chemicals

Woodybiomass

Plantation

Plastics

Electricity

Gas cleaning

tars

SLURRY

Waste material

BioethanolEsterification

Methanol

Herbaceousbiomass

Torrefaction

Biomasspre treatment

Oil/sugarseparation

Flash pyrolysis

Syngas Production

SynthesisBiodiesel

DME

Chemicals

Woodybiomass

Plantation

Plastics

Electricity

Gas cleaning

tars

SLURRY

Waste material

Source: Girard and Fallot (2006)

Page 10: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Value Added

Pulp/Paper

Source: Hildingsson (2006)

Plants are the most fantastic and efficient chemists in producing complex molecules

Page 11: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry ProgramSource: Svenska Grafikbyrån (2007)

Page 12: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

What To Do?Resource Efficiency: High productivity of biomass,

high rate of re-utilization of rest products

Energy Efficiency: Low energy input and high energy output. Low losses in the energy chain

Environmental Efficiency:

Sustained or improved local environment Low emissions of GHGs and air pollutants

Cost Efficiency: Low production costs

Page 13: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Resource Efficiency

Source: Obersteiner and Nilsson (2006)

Page 14: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Resource Efficiency

Wheat

Straw

Rape

Sugar Beet

Pasture

Corn

Hamp

Willow

Poplar

Spruce/Pine

Forest Residues

13%

4%

17%

12%

8%

10%

13%

5%

3%

5%

3%

Energy input (production, harvest and transport 50 km) per produced ton of biomass in percentage: Sweden

Source: Pålsson (2007)

Page 15: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Energy Efficiency

Heat and Electricity of Biomass: Conversion losses 10–20%

Losses can be kept especially low in co-production of heat and electricity

Biofuels: Losses 30–65% depending on conversion technology and fuel

Page 16: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Energy EfficiencyEnergy yield Mwh/ha and year by poplar energy forests: Southern Sweden

Source: Pålsson (2007)

Ethanol 15

CHP 40

Co-production of heat (2/3) and electricity (1/3) 40

Energy combines (ethanol 9; heat 16; electricity 7) 32

Electricity and fuels are more valuable energy carriers. Not enough just to look at high energy yields and security aspects

Page 17: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Energy Efficiency

The two highest yields are associated with cellulosic ethanol―the switch grass and poplar

For conventional ethanol, the top yields are from sugar beets in France and sugar cane from Brazil―roughly double the yields from corn in the US

The above ethanol yields are from optimal growing regions. The energy content of ethanol is about 67% that of gasoline

Source: Roberts (2007)

Page 18: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Energy Efficiency

For biodiesel, oil palm in S.E. Asia is a strong first―roughly 5x rape seed and 10x soybean. This primarily reflects a much higher oil content per kg and per hectare

The biodiesel yields estimates are conservative. The energy content of biodiesel is about 90% that of petroleum diesel

Source: Roberts (2007)

Page 19: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Energy Efficiency

Gasoline: Engine 75; Fuel Chain 30; Total: 105

Diesel: Engine 50; Fuel Chain 5; Total: 55

Flexfuel: Engine Fossil 20; Fuel Chain Fossil 5;

Engine Ethanol 70; Fuel Chain Ethanol 125; Total: 220

Kwh/100 km Medium-sized car

Saved C kg/100 km if the biomass used for ethanol production was instead used for replacing fossil heat: 20–25

Page 20: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Environmental Efficiency

One ton of wood replaces oil (heating) → Reduction of 1.3 ton CO2

One ton of wood replaces coal-based electricity production → Reduction of 1.5 tons of CO2

One ton of wood replaces gasoline by biofuels → Reduction of 0.8 ton of CO2

Page 21: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Environmental Efficiency

Perennial plants (forests, energy grass, etc.) normally have less local environmental footprints than single year plants (agriculture)

Agriculture uses intense soil preparation, fertilization, irrigation, genetically modified organisms, etc. Hardly any of this is used in, e.g., forestry. If the same production technologies as in agriculture would be used in forestry, the theoretical yield of forest biomass would be 3–4 times higher

Page 22: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Environmental Efficiency

Biodiesel F-T (IEA)

Biodiesel rapeseed (EU)

EtOH cellulose (IEA)

EtOH wheat (EU)

EtOH maize (US)

EtOH sugar cane (Brazil)

Biodiesel rapeseed (EU)

EtOH cellulose (IEA)

EtOH wheat (EU)

EtOH maize (US)

EtOH sugar cane (Brazil)

€/t CO2 equivalent

- 100 0 100 200 300 400 500 600 700 800

2002

Post-

2010

- 100 0 100 200 300 400 500 600 700 800

2002

Post-

2010

Post-

2010

Lower limit Upper limit

Source: Adapted from WWI/GTZ (2006)

Page 23: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Cost EfficiencyAgriculture-based ethanol ~70$/bbl

Brazilian ethanol ~50$/bbl (including fuel economy penalty)

First generation biodiesel Hardly competitive

Second generation (post 2010) biomass-to-liquid from forest biomass

~50$/bbl

Second generation (post 2010) lingo-ethanol

~50$/bbl

Target for being competitive with biofuels ≈50$/barrel

Page 24: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Raw Material Supply Tightens―Driving Up Costs for Alternative Energies

At prices of $100/barrel―success of biofuels

High demand in alternative fuels

Biofuels

Link Available Land ―

Biofuel Demand ―

Agriculture

Products

Page 25: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Supply limited (~50 million Toe today―200–300 million ha totally available for additional production)

Agricultural commodity demand increases with increased prices

The cost goal posts have changed dramatically

Raw Material Supply Tightens―Driving Up Costs for Alternative Energies

Page 26: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Transition will take much longer than expected

Palm Oil (raw material cost +90%)

2004 2007

Economically Competitive $50/barrel $130/barrel

Raw Material Supply Tightens―Driving Up Costs for Alternative Energies

Page 27: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Biogas

Food

Electricity Heat

Fuel

Or-ganic Waste

Manure, Wet

Energy Biomass

Biogas Reactor

Fermentation rests

Source: Formas (2007)

Page 28: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Economies of Scale

A production unit for synthetic

biofuels has to be big due to

economies of scale―this means

a 380 million liter plant/year

This will require 2.4 million m3 of

green wood/year

Page 29: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Economies of Scale

At large scale, estimate cost per installed gallon of $1.70 for cellulosic ethanol vs. $1.45 for starch-based ethanol

Lower variable costs vs corn-based ethanol $1.22-$1.31/gallon for cellulosic ethanol (assuming no carbon credits) $1.55-$1.75/gallon for starch-based ethanol

Higher capital cost driven by energy-efficiency cogen Cogen is elective based on separate ROI analysis Abandoned infrastructure reduces cost vs new

Estimated Scale Economies for Hardwood-based Cellulosic Ethanol

Source: Roberts (2007)

Source: SunOpta Bio Process Inc.

Page 30: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Spatial Aspects The economies of scale of biofuel plants causes

large logistic challenges Poland Example

To reduce Poland’s current fossil fuel consumption by 20% would require:• 3 production units the size of 380 million liters/year

• This means that each of these units needs a truck delivery every 3rd minute 24 hours around the clock

EU-15 To replace 15% of the fuel consumption would require 120–125

units of the above size The land required for biomass production is the same as the

total land area of Poland The logistic problems are enormous The production units have to be close to ports

Source: Blinge (2007)

Page 31: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Biomass Production

Source: Obersteiner and Nilsson (2006)

Page 32: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Transportation Costs of Biofuels

20 €/ton

200 km by truck

600 km by rail

10,000 km by ship

Page 33: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Jatropha CurcasYield not yet measured; plants are too young

8 month old plantation near Jogjakarta, Java, Indonesia

Good yielding bush

50 year old Jatropha tree

J. Mahafaliensis near Toleara, Madagascar

Page 34: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Toxic fruit and bark

Can grow on low productive land

Promising for producing environmental neutral fuel

The yield is far below that of palm oil per ha―huge areas needed

Jatropha Curcas

Page 35: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Average yield: 1.7 tons oil/ha/year

Bush breeding and cultivated conditions yields 2.7 tons oil/ha/year―huge areas needed

The bush needs 600–1500 mm of rainfall/year (ideally 1000 mm) to get yield

Produces fruit and flowers at the same time

Jatropha Curcas

Page 36: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Jatropha Curcas

China is claiming to have planted

13 million ha of Jatropha Curcas

by 2010 producing 6 million ton

of biodiesel

Page 37: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Palm Oil

Indonesia and Malaysia produce some 80% of the internationally traded palm oil

Palm oil constitutes 40% of edible oil trade

Average production 3.5 tons oil/ha/year

Hybrid clones 6.5 to 8.0 tons/ha/year

Page 38: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Indonesia Currently 6 million ha

under palm oil production

18 million ha of forests have been cleared for palm oil plantations

Additional 20 million ha are allocated in development plans for oil plantations

One of the main motors for deforestation

Large scale forest fires

Increased GHG emissions (drainage)

Page 39: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Competition Food demand will increase over time

Forest industrial products demand will increase in the future (driven by economic growth, demographic development, and energy development)Using the same raw material; pulp and paper industry generates 13 times more employment and 8 times more value compared to energy sectors (Pöyry, 2007)

Chemical industry has the potential to generate much higher value added of the biomassSome 8% of all fossil fuel goes to the chemical industry. Cracking the oil and generating the chemicals consume a lot of fossil fuel. Plants have the possibility to generate some of the chemical structures by themselves

Competition within the bioenergy sector

Page 40: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Wood Pellets

Europe is driving the global market for wood pellets, and this demand is driven by a series of “carrots” and “sticks”. Consumption already up roughly 10x since 2000 to ~5 million tpy, and expected to rise to almost 13 million tpy by 2010

Consumers? ~60% to co-fire coal power plants, 25% district heating, 15% residential

Source: Roberts (2007)

Source: Wood Pellet Association of Canada

Page 41: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Difficult to Generalize on Biofuels

The bioenergy systems:

Many combinations of bio feed stocks Many different conversion technologies Many different final bioenergy products Different local conditions Competition on raw material with other

products Security aspects Technological developments unknown

Page 42: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Modeling Framework

Multigas-MESSAGE

Systems Engineering IA-Model

Exogenous drivers for CH4 & N2O

emissions:

N-Fertilizer use, Rice production, Bovine Livestock

Bottom-up mitigation

technologies for non-CO2 emissions

Black carbon and organic carbon

emissions coefficients

Forest Sinks Potential, FSU

0

50

100

150

200

250

300

350

0 100 200 300 400 500 600 700 800

Rate of carbon sequestration MTC

Incr

ease

in P

rices

21002000

2050

Data Sources: Obersteiner and Rokityanskiy, FOR

Data Sources: Fischer and Tubiello, LUC

Data Sources: USEPA, EMF-21

Data Sources: Bond; Klimont and Kupiano, TAP

Data Sources: Fischer and Tubiello, LUC

Data Sources: Obersteiner and Rokityanskiy, FOR; Tubiello and Fischer, LUC

Biomass supply A2:WEU

0

2

4

6

8

10

12

Bio

ener

gy

po

ten

tial

(E

J)

Ag. residues

Biomass from forests

1$/GJ

6$/GJ

4$/GJ

5$/GJ

3$/GJ

Agricultural residue potentials

0

1000

2000

3000

4000

5000

6000

7000

PJ

NAM

WEU

PAO

FSU

EEU

AFR

LAM

MEA

CPA

SAS

PAS

Page 43: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Institutional Aspects Established energy companies are getting bigger and bigger and

have strong possibilities to influence the political power and policy making. The same is true for the agricultural lobby. A power the new bioenergy industry is lacking

Production of bio raw material in agriculture is often operated with substantial subsidies and protected markets. Forest production is largely based on the principles of a market economy. How to get an efficient land use allocation under these conditions?

To create a highly productive economy less or independent of fossil fuels is a transition comparable with the industrial revolution

Important to create environments open for experiments, failures and long-term strategies driving technological innovations. Relying just on the current economic forces will not be sufficient

“Minds are like parachutes―they work best when open”

Page 44: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Subsidies to Ethanol and Biodiesel

Source: Doornbosch and Steenblik (2007)

UnitsEthanol Biodiesel

Low High Low High

Support per liter equivalent of fossil fuels displaced

United StatesEuropean UnionSwitzerlandAustralia

$/liter equivalent$/liter equivalent$/liter equivalent$/liter equivalent

1.031.640.660.69

1.404.981.331.77

0.660.770.710.38

0.901.531.540.76

Support per tonne of CO2 equivalent avoided

United StatesEuropean UnionSwitzerlandAustralia

$/tonne of CO2 equivalent$/tonne of CO2 equivalent$/tonne of CO2 equivalent$/tonne of CO2 equivalent

NA590340244

5454520 3941679

NQ340253165

NQ1300 768 639

Note: The ranges of values reflect corresponding ranges in the estimates of total subsidies, variation in the types of feedstocks, and in the estimates of life-cycle emissions of biofuels in the different countries

(per liter net fossil fuel displaced & per metric ton of CO2 equivalent avoided)

Page 45: Biofuels  ―  From Oil to Alcohol Addiction?

Forestry Program

Conclusions: Biofuels Competition for land Once markets have stabilized, biofuels will be dominated by ligno-

cellulosics Bio-ethanol will continue to develop as a transport fuel developed in

tropical latitudes Replacement of fossil fuels for electricity and heat production by

biomass in co-generation of heat and electricity is superior to using the biomass for biofuels

Base production units of biofuels close to raw material and distribute finished energy carriers

Wood has some advantages relative to most other cellulosic biomass: Higher sugar content Higher bulk density (less top costs) Longer storage life and lower storage costs Less use of water and fertilizers Forest sector has a well developed collection system

Trade in bio raw material and biofuels will increase substantially