Challenges in the future bio-based economy

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1 Challenges in the future bio-based economy Indo-European Research and Innovation partnership 31 st of May 1 st of June 2012 Binod Daga, DSM Innovation Center, India

2 Agenda Bio Based Economy Building Blocks & Drivers DSM s Role in Bio Based Economy Biomass Availability in India Key Challenges for Bio Based Economy Few examples of ongoing partnerships Page 1

3 Safe harbor statement This presentation may contain forward-looking statements with respect to DSM s future (financial) performance and position. Such statements are based on current expectations, estimates and projections of DSM and information currently available to the company. DSM cautions readers that such statements involve certain risks and uncertainties that are difficult to predict and therefore it should be understood that many factors can cause actual performance and position to differ materially from these statements. DSM has no obligation to update the statements contained in this presentation, unless required by law. The English language version of this document is leading. A more comprehensive discussion of the risk factors affecting DSM s business can be found in the company s latest Annual Report, which can be found on the company's corporate website, Page 2

4 One renewable resource that can sustainably supply the world with food, energy, chemicals and materials BIOMASS! Key Drivers for Bio Based Economy Building blocks for Bio-Based Products & Services The Oil age will end long before we run out of oil, and while running out, it will become much more expensive Bioenergy Biofuels Biogas Bio-based Chemicals & Materials Climate change will have devastating economic, social, environmental and health consequences. Carbon emissions are expected to increase approximately 88% between reported 1990 levels and projected 2030 levels under business as usual scenarios Global population to reach nine billion people between 2040 and Energy and Food need for the population to grow exponentially Page 3

5 DSM is embarking on bio-based opportunities Bio-based Energy Cellulosic ethanol Bio-gas Bio-diesel Solutions for global Climate & Energy needs Highly attractive markets Leadership position in conversion technologies for ligno-cellulosic biofuels with #1 position in yeast Understanding the end market needs We have the necessary competences including: biotech, chemistry & polymerization Bio-based Chemicals Bio-succinic acid and other platform Biochemicals Page 4

6 DSM Biogas In India: Partnership with the PEDA (Govt. of India Organization to promote Renewable energy) on Biogas Operational since the 6 th of January 2012 Background: The biogas plant was designed to use 235 tones of droppings to generate 1 MW electrical energy in The power is fed to the grid and the left over slurry is a high quality Organic manure. The setting up of this plant lead to a GHG reduction of about 1000Kg CO2 C equivalent /hour and won the best Green Power Plant in Asia Award in Drivers for DSM: Showcase DSM s abilities in the area of Biogas Develop solutions for feedstock that are not currently being used to generate biogas Page 5

7 Biobased Economy Agenda Focus India Page 6 6

8 INDIAN BIOMASS POTENTIAL IS HUGE India has 141 million hectares of arable land > 1.5 billion MT/year of food + agri residues is produced, Hence a large amount of bio waste at fields & Agri processing units LARGE POTENTIAL FOR CROPS OF SHORT CYCLE CELLULOSIC BIOMASS 40% of arable land is under 1season mono-cropping India has 58 million hectares of grazing land. It is therefore possible to have both food and fuel! ANIMAL WASTE IS A SOURCE FOR BIO-ENERGY INDIA HAS AROUND 500 Mill POULTRY BIRDS & 280 Mill BOVINE ANIMALS Cow dung & Poultry litter are available in large quantities Page 7

9 Wheat Straw, Rice Straw, Sugarcane Tops, Bagasse and Rice Husk Key Biomass Agri Residues Field Crop Residues for FY10 Mln Tons Processing Crop Residues for FY10 Mln Tons Wheat Straw Rice Straw Sugarcane Tops Soybeans Cotton Stalk Corn Stalk Groundnut Straw 1.2 Jute Stalk Sugarcane Bagasse Rice Husk Rice Bran Cocunut Husks Groundnut Husks Corn Cob Maize Husk Coconut Shell Page 8 * Source: Universal Consulting

10 Evolution of BioFuels Opportunities & Challenges First Generation Grains and sugar to Ethanol Vegetable oil to Biodiesel Established Technology however limited Option for India Presently possible blend : 5% May at most be sufficient for 10% Second Generation Lignocellulose to Alcohols and Green Diesel Non-food & Non-fodder/ Surplus crops waste to generate bioethanol and biodiesel Annual availability > 500 MT!! Biomass biofuel potential > 100 MT/year Third Generation Biomass to Hydrogen Algal Hydrogen Viable once technologies are developed. Algal biofuels are grown in either natural or created aquatic environments and therefore don t compete for land with food crops Slide 9

11 Key Challenges for Bio Based Economy Scale Production and Capital Costs Technological Challenges Intellectual Property Securing Financial Support During Precommercial Development Page 10

12 Few examples of Indo-European research partnership 1. Indigo project between the Department of Biotechnology and European Union member states from DBT and EU supported project for Biomass research and Bio-waste conversion biotechnology 3. Indo German Science and Technology center has been started last year 4. 3 new projects in the area of Solar energy and support to 6 ongoing projects in the area of computational sciences 5. DST IFCPAR Bilateral Collaboration with France Slide 11

13 Suggestions on areas to collaborate Reengineering farming techniques to reduce Biomass wastage Technology development from engineering/processing point of view example: waste segregation techniques Biotechnology to convert biomass (already covered under SAHYOG, however there is room for more) Theme based funding for innovative and risky projects Slide 12

14 Slide 13 Thank You