European Biomass Industry Association World Bioethanol Perspectives Dr. Giuliano GRASSI EUBIA Secretary General Rue d Arlon, 63-65 B-1040 Brussels Belgium eubia@eubia.org www.eubia.org
Why Bioethanol? 1. To reduce Greenhouse Gas emissions from the transport sector 2. To improve security of energy supply (for transport) 3. To offer new outlets for the agricultural sector (from food to energy crops)
Context CO2 Mitigation is now the first EC priority!! The EC biofuels target is 10 % for the year 2020 The estimated EU potential (IEA) for biofuels is 30 % for the year 2030 What to do if the abrupt climate change and peak of conventional oil by 2020 proved to be correct?
Recent EU estimations of recoverable oil = 1800-3000 bn barrels 1100 bn barrels already consumed Present consumption ~ 30 bn barrel/year 12000 World Oil consumption 10000 8000 6000 4000 2000 0 2000 2100 2020 2030 Thus : ~ 50 years supply
Context Oil Prices are likely to remain high because : Increasing demand (China, Korea, India etc ) Getting more difficult and expensive to extract oil (artic, deep sea, ) Limited refinery capacity to meet growing demand (number of vehicles from 600 mio to 1.200 mio in ~ 20 years) Alternative fuels (from oil shale, tar sands, coal liquefaction) more costly Carbon charges to be added OPEC dominates the market With oil price rising alternatives liquid fuels will come on stream Liquid biofuels are gathering support because hydrogen remain a long term solution
Biofuels Current Situation Liquid Biofuels provide 1 % of present transport fuel demand Bioethanol provides ~ 2% of the World gasoline market Biodiesel provides 0.2 % of the World gasoline market Projection of biofuels contribution (IEA) : - 2025 : 290 mio m3/year of bioethanol (10% of gasoline) - 2050 : 1.400 mio m3/year of bioethanol (30% of gasoline)
Biofuels Future Challenge Total crop land availability (FAO) : 2.055 mio ha - 750 mio ha (present food area) - 1.060 mio ha (food area for 2025) - 995 mio ha (max Crop Area for no-food) Logistics chains for all co-products : problems for larger supply (0.5 to some mio t/y) to the processing plants Products quality of co-products for several markets Present competitiveness level for biofuels : ~ 400 /TOE Interest for High Energy Ratio (outputs/inputs) : R 2.0 (Present Range from 1 to 8) The introduction of FF vehicles changes the fuel market (the consumer decides the fuel at the refuelling station : fuel price is the most important factor) Search for new crops Better economics with Multi feedstocks-multi products processing but it is very complex issue.
World biofuels markets Food oil Biodiesel Bioethanol (blending 10%) 290mio m3/y 140 Mio m3 120 Biodiesel Food oil 100 No fuel 80 Fuel 60 Bioethanol Fuel Bioethanol (2.6% of gasoline market) 40 20 0 2006 Bioethanol trading (1,5 Mm3) 2006 Bioethanol (trading 1,5 Mm3) 2010 Bioethanol (trading 7 Mm3) 2010 Biodiesel 2025 -? Source : Biofuels Conference 14-15 Feb. 2007 (London)
/m3 600 500 400 300 200 100 0 150 Brasil (Sugar cane) Bioethanol Production Cost (2005) 175 Thailand (Cassava) 307 net 440 /m3 245 505 gross /m3 230 China (Corn) USA (Corn) EU (Wheat) EU (Sweet Sorgum) Cost of dewatering : ~ 40 /m3 Transport brasil-eu : ~ 40 /m3 World Food Crops Grains : 2,7 billion t/y Corn : 0,7 billion t/y Oil seed : 0.32 billion t/y Sugar cane : 1.3 billion t/y
The European Bioethanol Price Challenge ( /m3 : production cost + transportation + Import Tariff) 600 /m3 bioethanol market 430 /m3 (2006) 500 400 300 200 100 0 Brazil (sugar cane) Australia (sugar cane) Thailand (Cassava) India (sugar cane) USA (corn) EU (Wheat) EU (Corn) EU (Sweet Sorhum) European ethanol now requires significant subsidy Indigenous market is required At present Ethanol mandate is the only solution across Europe
Why Sweet Sorghum for Bioethanol? Sweet Sorghum is an extraordinarily promising multifunctional crop for several reasons: It requires common soil even with high % of sand and it is also adapted to salty areas; It requires low of water imputs ( ~ 200 m3 /ton), 1/3 of sugar cane requirements, 1/2 of corn; It has a short growing cycle from seeds (4/5 months), 1/3 of sugar cane; Many varieties are available for genetic improvment (~4,600) A high productivity of several components (grains, sugars, lignocellulosic); It can be grown in all continents, in tropical, sub-tropical and temperate regions (covering sugar-cane most sugarbeet areas);
Potential geographical areas for S. Sorghum Because of his wide geographical cultivation potential Sweet Sorghum could be the most important energy crop for combined power&biofuel production 70 60 52 Limit for cereals Sugar beet Sugar cane Sweet Sorghum
Three main types of Sorghum.
Sweet Sorghum Etoh Productivity Typical productivity from different varieties ETOH (l/ha) 7000 6000 5600 6700 6100 6000 5000 5000 5100 4000 4200 3000 2000 1000 0 1 Sweet Sorghum variety But the real crop development for ETOH is not yet started! Shennong1(China) Shennong1(Italy) Foralco(ITA) Sofra(ITA) Doina(RUM) Carmen(RUM) Doina(India) F-135ST(India)
Biomass production (S.S.) Biomass Production Bioenergy products for sale 1 ha sweet Sorghum (2006) Grains 7.495 ton 2.76 TOE 6.1 M3 etoh (4.2 TOE) Sugars 7.495 ton 3.00 TOE 18 ton Agro-pellets 7.3 TOE 93 fresh ton/ha (Average of 30.000 ha plantation) Bagasse ~ 20 dry ton 8.20 TOE 13.96 TOE/ha ~ 103 bbl/ha (1bbl ~ 0.135 TOE) 2.2 t DDG (~ 0.9 TOE) Total = 12.4 TOE
Energy Ratio (Sweet-Sorghum) INPUTS Energy consumption (for 1 ha S.S. plantation) ~ 0.85 TOE/ha Harvesting/cane crushing (for 1 ha S.S. plantation) ~ 1.20 TOE/ha Agro-pellets processing (for 1 ha S.S. plantation) ~ 1.40 TOE/ha TOTAL INPUTS ~ 3.45 TOE/ha OUTPUTS Bioethanol = 4.2 TOE/ha Agro-pellets = 7.3 TOE/ha DDG = 0.9 TOE/ha TOTAL OUTPUTS = 12.4 TOE/ha Energy Ratio : OUTPUTS INPUTS = 3.6
Cost of plantation Possible Value of Sweet-Sorghum components/ha Price of Final Products 1 ha sweet Sorghum (2006) ~ 850 /ha Cost of supply crop components to the complex ~ 1,250 /ha Grains (100 /t) 750 /ha Sugars (40 /t) 280 /ha Bagasse (11 /dry t) 220 /ha 60,00 50,00 40,00 30,00 20,00 10,00 transport (10 /t) processing (40 /t) residues (10 /t) 250,00 200,00 150,00 100,00 50,00 sugar value (2,4t x 40 ) supply cost (24 /m3) processing cost (110 /m3), no energy costs 0,00 agropellets 0,00 Bioethanol
Interest for Coproduction (Bioethanol-Power) from Sweet-Sorghum (High Volume of Biofuel & green power) Area S.S. Plantation (ha) 15.000 12.000 10.000 8.000 Bioelectricity for sale* 5.000 Bioethanol 3.000 1.000 10.000 20.000 30.000 40.000 50.000 60.000 70.000 80000 bioethanol) /production(m3 y 50x10 6 100x10 6 150x10 6 200x10 6 250x10 6 Green Power production for sale : KWh/y * Total bioelectricity production is 25 % higher but is used for the operation of the complex
Return Of Investment of Co-production (estimations)
Why Sweet-Sorghum is promising? Bioethanol price supply volume estimation Source : Biofuels Conference 14-15 Feb. 2007 (London)
Grains/Bofuels Trading Source : Biofuels Conference 14-15 Feb. 2007 (London)
Source : Biofuels Conference 14-15 Feb. 2007 (London)
Needed Source : Biofuels Conference 14-15 Feb. 2007 (London)
Main Conclusions Biofuels are presently the only ready-to-use solutions to curb rising CO2-emissions, to improve security of energy supply in the transport sector and to diversify the agriculture production EU bioethanol market is growing slowly but has high potential; still very small compared to the USA and Brazil, China etc EU Biofuels market is far from perfect : - (a) heterogeneous implementation in Member States - (b) no EU Common/internal Market yet EU-wide obligation of biofuels (like in USA and Brazil) is needed to achieve the target Low-cost bioethanol production is possible in future (sweetsorghum, lignocellulosic ETOH) in the EU.
European Biomass Industry Association Thank you for your attention! EUBIA Rue d Arlon, 63-65 B-1040 Brussels, Belgium eubia@eubia.org www.eubia.org
APPENDIX
Historical data on Alternative fuels in EUROPE European Consumption 1937 (t/year) Country Bioethanol Synthetic Fuels Total alternative fuels Total Transport Fuels Consumption Total Alternat. Total consump. UK 16.000 376.000 392.000 4.840.000 8,1% France 153.000 94.500 247.000 2.827.000 8,8% Germany 210.000 1.230.000 1.440.000 2.640.000 54,5% Sweden 15.247 500 15.747 503.000 3,1% Italy 37.000-37.000 483.500 7,7% Europe (17 countries) 510.322 1.796.300 2.306.622 13.014.700 17,7% Average subsidies : ~ 1.8 Li/l
Past Synthetic Gasoline Processes Hydrogenation Fisher-Tropsch Feedstock Capacity (gasoline/year) 8 t coal or 15 t lignite T gasoline > 150.000 t/y ~ 17 t lignite T gasoline > 30.000 t/y Process High pressure Low pressure Quality High octane Low octane Investment 880 mio li (150.000 t/y) 220 mio li (30.000 t/y) Production cost 1.61 li/kg 1.65 li/kg
ANIC fu obbligata nel 1937 a costruire 2 impianti (Livorno e Bari) con sovvenzione per garantire 6%-8% di interessi al capitale investito per 10 anni.
Transport Fuel Situation in Italy (1937) Total transport fuel : 483.500 ton/year Bioethanol : 37.000 ton/year Synthetic fuels : 0 ton/year Sugar beet area : 138.000 ha (of which 38.000 for bioethanol production) Refuelling stations : ~ 30.000 units Rail-tanks : 4.500 units Storage capacity : 2.500.00 m3 Capacity of oil tankers : 400.000 t Oil importing Co (low 14/02/1930) were obliged to mix gasoline with bioethanol (at 12% by law 21/10/1938) Many critics : - High cost. 265 Li/m3 - Plants operating only 2 months/year - High cost for energy processing : 1,5 Kg (imported coal) 1 Kg bioethanol - Incertitude of supply Program was initiated to asses sweet-sorghum potentiality because it presents : - Improved conservation capacity than sugar-beets - Higher bioethanol yield (3.5 against 2.5 m3/ha for s.b.) - Possibility of use of semi-arid lands of Mezzogiorno - Possible use of large ligno-cellulosic residues (i.e. paper) reducing the cost of bioethanol