Logistic Constraints in Developing Dedicated, Large-

scale, Bioenergy Systems in the Southeastern USA

John S. CundiffJohn H. Fike

David J. ParrishJeffrey Alwang

Definitions

• Biomass – plant-derived material harvested for energy purposes.

• Biofuel – energy sources (solid, liquid, or gas) derived from biomass.

• Bioenergy – energy resulting from the combustion of biofuel.

• Energy crop – any crop that is grown specifically to produce biomass for bioenergy.

“We take the position that, although plant-based fuel sources cannot fully replace fossil fuels, if appropriately implemented, they can and will be an important component of future fuel and chemical feedstock supplies.”

Biological (organic) material will be of accelerating importance in the future.

Three reasons for increasing energy from renewable

resources

• Energy security• Climate change• Rural economic development

Ohio S.R. 220

• 25% of electricity generated in Ohio will be generated with “Advanced Energy Technologies”

• 12% of this 25% will come from wind and biomass

• 0.5% will come from solar• Where will the remaining 12.5% come

from? (The biggest “chunk” will come from nuclear.)

Bioenergy can -

• Decrease demand for fossil fuels---energy independence

• Mitigate emissions of CO2---contributor to global climate change

and…

many believe they can serve as engines for rural economies

Do we want to continue to concentrate our population in urban centers?

What are the advantages?

What are the disadvantages?

How much biomass is out there?

DOE suggests that one billion tons/year could be sustainably harvested in the U.S.

The largest paper mill in Virginia uses 10,000 tons/day

or

3.5 million tons/year (0.35%)

What are the two questions you must answer to know how much

biomass is available?

How much land is available?

How much biomass can be produced per unit land area?

…Almost two-thirds of the land area in Virginia is covered by forest…

Current Forests

• 15.8 million acres

• 63% of total land area

63%

Forest Landowners

FEDERAL GOVERNMENTNATIONAL FOREST (14%)

FORESTINDUSTRY (7%)

GOVERNMENTOTHER (2%)

PRIVATE FOREST

LANDOWNERS (64%)

TIMO’s (13%)

695 acres

Contiguous forest patch(Louisa Co, VA)

1 Forest patch = 65 forest parcels

10 acres average;0.1 to 90 acres

Forest Products Industry

• Top employer in Virginia (248,000 jobs)– Employs one of every six manufacturing

employees (1st in salary & wages)• Contributes $30.5 billion to VA economy

– 6% of Virginia’s gross state product– 27% of industrial establishments in VA

manufacture forest products

Secondary wood sources such as processing residues (e.g., shavings, sawdust, and bark) and pulping liquors currently account for 50% of U.S. biomass consumed.

Forest residue (limbs, tops, weed species trees) produced as a by-product of lumber and pulp harvest may also provide substantial amounts of biomass,

but this is possible only on a site-specific basis.

Biorefinery – any facility that, on an industrial scale, can

convert biologically-derived materials into more immediately useful forms (liquid fuels, biogas, chemicals and monomers).

Term will likely evolve to describe facilities that produce liquid fuels (and chemicals).

What scale are we talking about?

200 mi x 90 mi

Should genetically modified plants be used for bioenergy?

What will be the position of policy makers as bioenergy pushes up food prices?

Historically, the U.S. has had cheap energy and cheap food. If you have to choose, which will you choose?

• U. S. grain used for ethanol represents 4% of global grain production

• U. S. grain used for ethanol represents 43% of the increase in global grain consumption from the 2005/06 and 2007/08 marketing years

• U. S. consumption of grain for ethanol in 2008 exceeds the total of all grain exports

Herbaceous Options

• Wheat• Sorghums• Soybean• Sunflower• Corn

If all the corn (grain ethanol) and soybeans (biodiesel) grown in the U.S. are used for energy, this would supply only 12% of U. S. energy needs.

What is your reaction to the following statement?

“Ethanol-from-corn as a national strategy is not sustainable as currently practiced.”

Crop residues constitute almost half of agriculture’s contribution to the DOE/USDA billion-ton, biomass-for-biofuels scenario.

What are the issues relative to, for example, corn stover collection?

Why not do this, it just rots in the field.

Suppose I go from the corn stover you just saw to a fuel pellet. (Fuel pellets can be handled using the technology used to handle grain.)

Round bales from field

Ambient storage

Deliver to Pellet Plant

Store in silos/bins

Deliver to Biorefinery

SSLFarm gateReceiving

facilityLoad/haul

Agricultural operations

Industrial operations

“Wet” vs. “Dry” Systems

• Wood chips – a 20 Mg load of wood chips (40% MC) means the truck

is hauling 8 Mg water, 12 Mg dry matter

• Switchgrass – a 14.5 Mg load of switchgrass (15% MC) means the truck is hauling 2.2 Mg water,

12.3 Mg dry matter.

12.3 vs. 12 Mg dry matter---the two systems are nearly equivalent.

Comparison of Coal and Wood Chip Systems

900 MW coal plant – needs a 100-car unit train every two

days

900 MW wood-chip plant – needs a 36-ton truckload of chips every 4

min

15 trucks/h x 10 h/d = 150 trucks/d

Pittsylvania Power Station

80 MW

150 chip vans per day (averages one every 4 minutes for 10-h day)

What would have to happen to build a 8 MW wood-fired electric

generating plant on the VT campus?

What about a system that emulates the Roanoke trash train?

Distributed storage – there is a cost advantage to minimizing at-plant storage

Where is the coal storage for the 1 5 MW VT coal plant?

Around-the-clock delivery – BIG issue relative to a bioenergy plant.

How will this be accomplished?

We will now change gears.

We are going to integrate issues from other disciplines with the “purely” technical issues.

Key issues relative to sitting a bioenergy plant.

Socio-economic Issue: Percentage of land area attached into production.

Agronomic Issue: Yield per unit land area.

Which option would you prefer?

Option 1: Location where yield is 4.5 Mg/ha and 40% of surrounding land area is planted in feedstock.

Option 2: Location where yield is 11.4 Mg/ha and 10% of the surrounding land area is planted in feedstock.

Option 1---corn stover in the Midwest

Option 2 ---switchgrass in South Central Virginia

Grain Ethanol vs. Cellulosic Ethanol

How is grain ethanol made?

How is cellulosic ethanol made?

Food vs. Fuel controversy.

Other Liquid Fuels

How is bio-crude made?

Feedstock: Any organic material

How is biodiesel made?

Feedstock: Oil seeds (soybean)

Waste grease and oil

Pretreatment Technologies

Cellulosic Sugar Ethanol

Material (or other

fermentation products)

Cellulose C6 sugars

Hemicellulose C5 sugars

Pretreatment Fermentation/Distillation

What are two natural systems that break down cellulose?

• Termites• Bacteria in rumen

What are the three components of plant cell walls?

• Cellulose• Hemicellulose• Lignin

Pretreatment Technologies

Cellulosic Sugar Ethanol

Material (or other

fermentation products)

Cellulose C6 sugars

Hemicellulose C5 sugars

Pretreatment Fermentation/Distillation

Most credible studies estimate capital cost for a 50 million GPY cellulosic ethanol plant at three to four times the costs of a similar-sized grain ethanol plant.

Feedstock cost + conversion cost =

Total cost

Corn grain---higher Conversion---lower

Switchgrass---lower Conversion---higher

Key problems:

1. Pretreatment of the fiber produces inhibitors which reduce the ability of microorganisms to convert the sugar to ethanol.

2. Most organisms do not convert both the C5 and C6 sugars.

Public policy is viewed as “the single most important strategy to moving toward a carbohydrate economy”.

Why?

Because the market has no way to incorporate the externalities (environmental cost , cost of military to insure stability of oil-producing regions, ect.)

Is there resistance to competition in energy markets by existing industries?

Utilities

Coal companies

Railroads

Pipeline companies

“The U.S. governments unwillingness to promulgate many policies supporting renewable energy has been, in part, fueled by industry lobbying and it is our view that it would be naïve to assume that such efforts to influence policy and access to markets will be curtailed in the near future.”

A biorefinery’s distance to markets affects prices at the pump.

Swenson (2006) reported that the cost of transporting ethanol from a plant in Iowa to its final destruction represented around 10% of the total cost.

Will bioenergy influence land prices?

Will bioenergy influence land ownership patterns?

Future issues:

• Carbon sequestration credit• Value of co-products

The cost of climate change from coal-generated electricity has been conservatively estimated at $11 to 25 per MWh (Tol, 2003).

External health costs associated with large-scale coal electricity generation have also been documented.

$24.16/MWh Roth and Amb (2004)

$9.5 to 28/MWh European Commission (2003)

U.S. Tax Policies

1. Energy Policy Act of 2005

Provides a federal ethanol subsidy of $0.51/gal

2. State-level incentives (particularly in the Corn Belt)

With subsidies and incentives, the gross profit margin for producers in approximately

$0.27/gal

There is no question that environmental policies geared to reduce carbon emissions will make biofuels more competitive with conventional energy sources.

Estimates of the relationship between carbon prices and the cost-competitiveness of biofuels range from

$20 to $50/ton CO2

Renewable Fuel Standards

• 20 states have adopted• Standards enhance the competitiveness of

biomass electricity generation

Dispatchability

Wind

Solar

Photovoltaic

vs.

Biomass

Market-based Barriers

• Vertically integrated energy firms control access to transmission and distribution networks.

(These firms are politically and economically powerful.)

• Regulatory conditions and expenditures required to overcome them can represent an important cost for an infant industry. (Government has a role to play.)

The drivers for bioenergy systems

- reduced greenhouse gas emissions

- energy security

- benefits to rural economies

can (and should!) limit their implementation if these strategies are not successful.