Bioenergy markets: the policy demand for heat, electricity and biofuels, and sustainable biomass supply

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Transcription:

Bioenergy markets: the policy demand for heat, electricity and biofuels, and sustainable biomass supply Results from alternative bioenergy demand scenarios for 2020 and 2030 Ayla Uslu, Joost van Stralen ECN Policy Studies 20 March 2012, EP

Content 1. Objectives of the modelling activity 2. Results 3. Recommendations

Biomass use in EU27 based on NREAPs According to the NREAPs biomass plays a crucial role in MSs reaching their targets Around 12% of the total gross energy demand in 2020 from 85 Mtoe in 2010 to 134 Mtoe in 2020, A number of support schemes for RES electricity, heat and transport sector Pending questions Implementation of sustainability criteria? Potential versus demand whether proposed actions/policies result in achieving the targets

Biomass Futures-ECN energy modelling Set up and quantify scenarios and sensitivity variants addressing the Climate Change and the current EU RE policy, detailed per MSs. The results The share of biomass application in the different sectors The percentage or the available (sustainable) biomass supply that is actually used Costs (direct and in comparison with fossil competitor), GHG emission reductions ECN RESolve Model Set including a static biomass allocation model, dynamic RE-E and RE-H/C market models. Includes intra- EU trade and biomass/biofuel import

Scenarios presented Reference scenario Existing RED sustainability criteria (only for biofuels) No iluc factor Global Sustainability (domestic + imports) RED sustainability criteria applied to all bioenergy, mitigation requirement increased to 70% for 2020 and 80% for 2030 ILUC factor included Common to both In both scenarios the recent policy measures presented in NREAPs and the PRs have been include

Conclusions Europe holds a significant amounts of biomass potential for energy purposes agricultural potential is large but only around 30% is economically and technically feasible to produce energy Current policy initiatives are not sufficient to reach the targets set in NREAPs Strengthening sustainability criteria, including the iluc effects and expanding them to electricity and heat sector Reduced biofuel production in Europe (bioethanol disappears and biodiesel production limited to used fats and oild) Increased import of wood pellets Urgency for the 2 nd gen. technologies Reanalysis of the biofuels role in reaching the renewable transport targets

In 2020 only around 40% of domestic feedstock will be utilised to contribute to the NREAP bioenergy targets. Feeds stock input [PJ] 10000 9000 8000 7000 6000 5000 4000 3000 2000 1000 8% import 0 2010 2015 2020 2025 2030 Waste Forestry Agricultural

Feedstock utilisation versus potential in 2020 5000 Domestic feedstock use in 2020 4500 4000 Manure & straw Primary feedstock [PJ] 3500 3000 2500 2000 Grassy perennials Paper& cardbo ard REF 2020 REF-Pot 2020 G-SUS 2020 1500 SUS-Pot 2020 1000 500 0 Utilising the agricultural residues for energy purposes will remain as a challenge.

Import - Reference v.s. Global sustainability scenario EU27 Domestic feedstock use in 2020 & 2030 Import in 2020 & 2030 9000 8000 1200 7000 Prima ary feedstock [PJ] 6000 5000 4000 3000 PJ 800 400 2000 1000 0 REF 2020 G-SUS 2020 REF 2030 G-SUS 2030 3rd forestry res 2nd forestry res 1st forestry res Add. Harv. Roundwoud Roundwood prod. Landscape wood Per. Crops Rot. Crops Agri res Wastes 0 REF 2020 G-SUS 2020 Wood pellets Rotational crops Biodiesel REF 2030 Palm oil Bioethanol G-SUS 2030

Electricity sector biomass uptake EU 27 total electricity production from biomass in 2020 250 200 [TWhe] [ 150 100 Liquid Biogas Solid 50 0 2020 REF 2020 G-SUS NREAP Deviation between the reference scenario and NREAPs is 7%, increasing to 21% when the sustainability criteria are strengthened (and iluc included) and expanded. Biogas sector is the most effected.

Electricity sector-biomass technology uptake 1000 900 800 700 Reference scenario biomass-chp plays an important role around 5 % of the total electricity production in 2020. RES- -E [PJ] 600 500 400 300 200 100 0 2010 2015 2020 2025 2030 Other Electricity only Digestion CHP Co-firing CHP However its development depends on the local heat demand and the existing infrastructures.

Reference scenario heat production from biomass 100 He eat demand [Mtoe] 75 50 25 CHP Industry Tertiary Residential 0 2020 2030 2010 2020 2030 Share Share Share Residential 47% 22% 15% Tertiary 14% 25% 28% Industry 28% 38% 40% CHP 11% 15% 17%

Biofuels production Reference versus G. sustainability scenario Biofuels [PJ] 1600 1200 800 400 0 Biofuels in 2020 Larger share of advanced biofuels REF G-SUS NREAP Bioethanol 2nd Bioethanol Import Bioethanol 1st Biodiesel Import Biodiesel Bio-SNG Bio-FT-diesel Bio-DME Other Stronger GHG mitigation targets combined with the iluc criteria can result in No domestic bioethanol production Significantly decreased biodiesel production (only used fats and oils) Ambitious 2 nd generation technology growth rates

Conclusions Europe holds a significant amounts of biomass potential for energy purposes agricultural potential is large but only around 30% is economically and technically feasible to produce energy Current policy initiatives are not sufficient to reach the targets set in NREAPs Strengthening sustainability criteria, including the iluc effects and expanding them to electricity and heat sector result in Difficulty in biogas electricty/heat sector Reduced biofuel production in Europe Increased imports (wood pellets) Urgency for the 2 nd gen. technologies Reconsider the biofuel role in reaching the renewable transport targets Reconsider doing sectoral /segment policy

Recommendations Policy initiatives should be tailored to pull previously unused biomass from the forests and gather post-consumer residues and promote the most efficient technologies Agricultural residues need to be utilised - through enhancing use of straw and prunnings and help to find sustainable co-substrates for the manure digestion for biogas. While CHP plays an important role its efficient use should be ensured through investments into the district heating systems Current policy initiatives should be strengthened to achieve the targets. Application of sustainability criteria not only to domestic resources but to imports shall be safeguarded. 2 nd generation technologies need to be brought to the market asap. Current work considers intra-trade of biomass and biofuels but do not consider statistical transfer of electricity and/or heat in reaching the targets. Thus, the role of cooperation mechanisms should be further researched.

www.biomassfutures.eu Thank you! Ayla Uslu ECN Energy research Centre of the Netherlands uslu@ecn.nl

Sustainability criteria GHG mitigation criteria 2020 Reference Only for biofuels & bioliquids GHG emission mitigation : 50% Excludes iluc Sustainability For all bioenergy consumption in the EU Biofuels/bioliquids: 70% mitigation Bioelectricity and heat: 70% mitigation as compared to 2020 fossil energy mix Compensation for iluc related GHG emissions. GHG mitigation criteria 2030 Other sustainability constraints Only for biofuels & bioliquids GHG emission mitigation : 50% Excludes iluc Only for biofuel and bioliquids consumed in Europe the use of biomass from biodiverse land or land with high carbon stock For all bioenergy consumed in the EU Biofuel/bioliquids: 80% mitigation Bioelectricity and heat: 80% mitigation as compared to country specific fossil mix) This includes compensation for iluc related GHG emissions. For all bioenergy consumed in EU limitations on the use of biomass from biodiverse land or land with high carbon stock. In the RESolve model from 2017 onward the GHG emission reduction criterion is set to 50% and from 2018 onwards to 60% for installations that become operational on or after 2017.

ILUC-GHG emissions per crop (gr. CO2eq/MJ bioenergy) based on the review of studies used in the assessment of storylines in this report and from the ATLASS (2011) study Type of biofuel Median iluc values reported in inventory of studies in this report (see Chapter 4) Average ILUC emissions from ATLASS (2011) in % difference Rapeseed 77 55 Wheat 73 14 19% Sugar beet 85 7 Palm oil 77 54 Soybean (from Latin America)* 140 56 Soybean (from US)* 65 56 86% Sugar cane 60 54 Maize 60 10 17% Ligno-cellulosic based land using 2nd generation ethanol** 52 15 29% Ligno-cellulosic based land using 2nd generation biodiesel** 52 15 29% 71% 8% 70% 40% 90% *Atlass (2011) does not distinguish between the two **In this study this refers only to the 2 nd generation biofuels produced from dedicated crops. In the ATLASS this includes a much wider range of ligno-cellulosic feedstock, including waste, which is probably one of the reasons for this lower iluc factor.

RESolve models General: RES only; up to 2030; on a yearly basis; EU27 (country level) RESolve-E: RES-E + heat from CHP; simulation (projection);policies important RESolve-H: RES-H; simulation (projection) RESolve-biomass: biofuels + bio part of RES-E and H; optimization 19

RESolve: linkage between models Biomass allocation: RESolve-biomass STATIC 20

RESolve: linkage between models Potentials Prices RES-E: RESolve-E Δin demand Dynamic growth Biomass allocation: RESolve-biomass Dynamic Potentials Prices RES-H/C: RESolve-H/C Δin demand Dynamic growth 21

Biomass allocation in RESolve-Biomass Find the minimal additional cost allocations along the bio-energy supply chain in the EU, given projections of demand, potentials and technological progress with respect to reference commodities biofuel target, bio-electricity and -heat 22

RESolve-Biomass: how does it work? Import & export GHG constraints included 23

RESolve-E: how does it work? Policy-based demand for renewable electricity scenarios years Technology mix Trade flows Risk Transaction Costs Lead times Supply curves Based on Technology Costs & potentials 24