In the black: Advanced biofuels and chems: sizzling carbon and parity-pricing updates

September 17, 2013 |

c18Two new studies with red meat for the “biofuels are a win on carbon” crowd; while Elevance has good news for those in the “don’t care about carbon, give me parity pricing” gang

For those of you with an interest in carbon economics, two fascinating studies came out this week that we’ll look at in some depth — one out of the UK, sponsored by BP, and one from US-based academics.

The carbon highlight?

A report published by strategic energy consultancy Element Energy finds that by 2030, higher levels of advanced biofuels could cut Britain’s annual car CO2 emissions by 27% or 12 million tonnes a year — at a cost to the consumer of just $20.68 per year, at costs expected in 2030.

For climate-change skeptics or those less interested in the carbon side of the biofuels equation and more interested in parity-priced breakthroughs, good news this week from Elevance Renewable Sciences.

The Parity-pricing highlight?

Elevance has announced that — based on materials from its commercial-scale Gresik, Indoesia biorefinery — and its metathesis technology — it can now make Inherent C18 Diacid, mid-chain length, bio-based diacid used by producers of polyamides and polyurethanes, lubricants and adhesives — with the purity required for demanding applications like polymers at a cost that is competitive with other specialty diacids in the marketplace.

Elevance-Gresik

More on that story here.

Carbon reduction: how much are drivers willing to pay?

At the same time, a survey from the Transportation Research Institute at the University of Michigan – focused on in-vehicle carbon reduction technologies — found that drivers would be willing to pay about $100 for a 20% reduction in carbon dioxide emissions and $250 for an 80% reduction.

According to the study’s authors, drivers also appeared to accept about a 5% reduction in fuel economy for a 20% reduction in carbon dioxide emissions, and a 10% reduction in fuel economy for a 80% reduction; and finally, they appeared willing to accept about a 10% loss in trunk space for a 20% reduction in emissions, and a 16% loss in trunk space for an 80% reduction in emissions. to in-vehicle technologies that reduce carbon emissions.

Green premiums? Small, but perhaps enough.

Putting the two together — there’s a relatively good margin there between the two costs, suggestive that the kinds of green premiums associated with advanced biofuels are well within the limits acceptable to consumers.

Element Energy associate director Alex Stewart said: “In the long term, electric plug–in and fuel cell vehicles are likely to play a significant role in the transport mix. But biofuels offer a more cost effective way to reduce emissions over the next 17 years, with a fuel premium of $534M in 2030 against the $1.908 billion it would cost in customer incentives to achieve the same CO2 savings with plug-in vehicles.”

Among the surveyed drivers, acceptability of carbon-capture technology depended on driver belief that human activity is associated with global warming. Drivers that reported agreement with such statements were found to be more accepting of in-vehicle carbon capture technology: they were generally willing to pay more for this technology or to trade storage space and fuel economy for such technology.

The UK-based Element Energy report, which explores the role of biofuels beyond 2020, found that a 27% reduction on emissions in 2030 would result from what Element Energy defines as a “high biofuels pathway” – blending levels of up to 19% of advanced “drop-in” biofuels which are fully compatible with modern engines into road transport fuels. This compares with the current level of 5% biofuels blended in UK road fuels.

The consultancy also believes emissions could still be cut by 9% (4Mt) without widespread uptake of advanced biofuels via a “medium biofuels pathway”.

The 20% advanced biofuels pathway

Under this scenario, 20% biofuel blends would be introduced from 2020, including use of some advanced biofuels such as ethanol made from cellulosic feedstock, in line with the UK government’s most stringent sustainability assumptions, known as the ‘Highly Restrictive Sustainability Standards Scenario’.

While reducing emissions through biofuels will require changes to the way we use fuel, the report predicts that drivers won’t be hit at the pumps. Element Energy’s researchers predict that, based on current cost projections within the medium pathway, the owner of an average car would see their annual fuel bill increase by just £13 in 2030.

Crucially, with internal combustion engine (ICE) vehicles expected to continue to dominate the car fleet until at least 2030, Element Energy’s “pathways” also show how biofuels can work alongside – rather than in competition with – new hybrid and plug-in hybrid vehicles, avoiding the risk of a technology ‘lock-in’.

Andy Eastlake, managing director of Low Carbon Vehicle Partnership, an advisory group promoting the shift to clean low carbon vehicles and fuels, said: “This report provides evidence that biofuels of the highest sustainability standards could have an important part to play in the UK’s carbon reduction strategy.
“We firmly believe that a broad range of low carbon solutions are necessary; decarbonising liquid fuel used in combustion engines is one of the best ways to make significant progress in the short to medium-term.”

The cost of climate disruption?

According to an NRDC report, “paying for climate disruption was one of the largest non-defense discretionary budget items in 2012. Indeed, when all federal spending on last year’s droughts, storms, floods, and forest fires are added up, the U.S. Climate Disruption Budget was nearly $100 billion.” NRDC noted that US taxpayers paid three times what private insurers paid out to cover losses from extreme weather, and the federal government spent more taxpayer money on the consequences of 2012 extreme weather than on education or transportation.

Climate-skeptics — and lovers of low-keyed debate — might well point out that storms predate climate change — and that it it is impossible to accurately separate out climate-related costs within storm recovery actions.

Download the complete Element Energy study here.

Download the abstract for the University of Michigan study here.

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