Great Leaf Forward: The Top 10 Trends driving the Canadian advanced bioeconomy

May 1, 2017 |

Although the bigger players — China, the US, Brazil and the EU take most of the headlines in the advanced bioeconomy, Canada is definitely “boxing above its weight class” these days, as the saying goes. In particular, in the areas of innovative project deployment and policy support, Canada has been shining, and in many ways the causes for that are linked.

It’s been a more holistic approach in Canada, on the whole — more carefully timed based on policy support. The reliance on  sovereign investment has kept Canada generally speaking out of the business of encouraging and funding projects and then stranding them without the policy supports to reach and be successful at commercial scale.

Canada gets fewer kudos for its R&D chops — and in our top 10 that we have presented, there are no truly early-stage efforts recognized — but its well worth pointing out that technologies such as Enerkem, Ensyn, Forge Hydrocarbons, Comet Biorefining (and Iogen too, though commercialized initially in Brazil) are home-grown technologies. In fact, the past two recipients of the Holmberg Award for Lifetime Achievement hail from Canada — Iogen’s Brian Foody and Ensyn’s Robert Graham — and both of them shepherded technologies through to world-scale all the way from the lab.

In today’s Digest, the Top 10 Trends from Canada.

10. Renewable Industries Canada hits back at Ecofiscal Commission study

Last October, we reported that Renewable Industries Canada charged the Ecofiscal Commission with releasing” a skewed, flawed and unacceptable report” that called on policymakers to rethink biofuels policies.

The report, Course Correction—It’s Time to Rethink Canadian Biofuels Policies uses information that ignores independent biofuels cost benefit analyses and omits current government data and reports as the basis of its recommendations, including the ill-advised suggestion to phase out renewable fuel mandates.

“Ecofiscal’s recommendation to phase out renewable fuel mandates shows how little appreciation it has for how the fuel market functions, what it takes to successfully lower greenhouse gas emissions from our transportation sector and meet Canada’s climate change objectives,” said RICanada President Andrea Kent.

Never mind the push-back, it’s a trend around the world that people are taking a hard look at payback on biofuels.

Renewable Industries Canada hits back at Ecofiscal Commission study

9. Forge Hydrocarbons sees Canadian renewable diesel plant online H2 2018

We reported in March 2017 that FORGE Hydrocarbons Corp. is developing a technology that transforms low-value fats, oils and greases into fuel. The objective of this project is to continue the accomplishments of the 200,000 litre per year pilot plant, which was supported by investments from Western Economic Development Canada and Alberta Livestock and Meat Agency Ltd. with the construction of a pre-commercial demonstration plant. The first of its kind in Canada, this lipid to hydrocarbon plant will produce renewable liquid hydrocarbons with a production capacity of 25 million litres per year.

Trend? More things to do with waste — but more importantly, another step towards drop-in fuels.

8. Aviation’s progress. Air Canada takes off with biofuels tests

We reported last week that Air Canada just revealed its participation in the Civil Aviation Alternate Fuel Contrail and Emissions Research project, a research project led by the National Research Council of Canada to test the environmental benefits of biofuel use on contrails. A reduction in the thickness and coverage of contrails produced by the jet engines of aircraft could reduce aviation’s impact on the environment, an important beneficial effect of sustainable biofuel usage in aviation.

The contrail backstory? Contrails are produced by hot aircraft engine exhaust mixing with the cold air that is typical at cruise altitudes several miles above Earth’s surface, and are composed primarily of water in the form of ice crystals. The emissions impact? It has to do with particular aspect of aviation, that is the nature of the emissions and the altitude they are released at. Aircraft emissions can count for anything between 1.2 and 4.7 times their actual weight. The most recent studies we’ve seen focus in on a 1.9 figure. And that means a double carbon bonanza for biofuels, where carbon is counted.

But that’s not all in aviation. We reported in April 2016 that WestJet teamed up with Alberta-based, Clean Energy Technology Centre (CETC) to accelerate the development of sustainable aviation biofuel in Western Canada. The location and proximity of Drayton Valley can help solve many of the challenges that face the development of the biofuel – namely finding an efficient and economical way of getting fuel from production to aircraft. The CETC itself is located in Drayton Valley, home also to the “Bio Mile,” an integrated bio-industrial park with close proximity to forestry and oil and gas industries whose infrastructure and human resources could eventually support the development of the alternative fuel source

Trend? If fully accounted for, you could see a biofuel producer looking at making diesel or jet with the same technology — but having a potential double carbon credit. That helps under, say, Low Carbon Fuel Standards, where the carbon credit is directly related back to the emission reduction. But that’s just part of the story — the bigger picture is that Canadian aviation is on the move with renewables.

7. Crossing the chasm to scale: S2G goes commercial with bioglycols

We reported last June (in Tennessee) that S2G BioChemicals completed a five-week commercial production campaign of fossil-free, bio-based glycols at the Pennakem plant in Memphis. The campaign produced industrial-grade sugar-based glycols from natural, non-food waste. We first reported on the commencement of the run here, in April. S2G? That’s Mark Kirby’s company — along with a talented crew that hangs its shingle in Vancouver, British Columbia.

 

Trend? Renewable chemicals are on the march, and in Canada they are getting to full-scale.

6. Export Development Canada prices US$300 million 1.25% Fixed Rate Green Bond

We reported in December 2015 initially on this one — that Export Development Canada had priced a new US$300 million 1.25% Fixed Rate Green Bond due December 10, 2018. The lead underwriters were BofA Merrill Lynch, Crédit Agricole CIB and Morgan Stanley. This new bond reflects EDC’s ongoing commitment to developing the Green Bond market. This offering is scheduled to close on December 8, 2015. This was EDC’s second Green Bond issuance. Its inaugural Green Bond, which was issued in January 2014, received strong support from the Green Bond investor community and supported several biofuel companies including Raizen and BioAmber.

Trend? Another source of affordable finance — and that’s a deal-maker and a deal-breaker, these days.

5. Enerkem’s progress turning trash to cash

We reported last week on news that Enerkem has received the lowest carbon intensity value ever issued by the British Columbia Ministry of Energy and Mines for its ethanol product under the Renewable and Low Carbon Fuel Requirements Regulation.

The confirmed carbon intensity is a shocker. Where gasoline check in at the testing center at 88 grams of CO2-equivalent per megajoule of energy, Enerkem fuel clocks in at 55 below zero. How possible? Enerkem’s product removes carbon emissions from the atmosphere, rather than adding to them. So, all you really need to do is blend three gallons of Enerkem fuel with two gallons of conventional gasoline, and you’ve solved the transportation climate change problem.

Trend? The British Columbia Renewable and Low Carbon Fuel Requirements Regulation opens up the door for Enerkem to sell its advanced ethanol in the province, in addition to the local Alberta market where its world’s first full-scale facility in operation is located. Low carbon, when it goes really low — generates amazing values for producers. Negative carbon fuels, negative cost feedstock — that’s a potent combination and Enerkem has it.

4. Ensyn’s expansion: Canada and Quebec to provide C$76.5 million to AE Côte-Nord Bioenergy Canada

In Canada, the Governments of Canada and Quebec will provide C$76.5 million in funding to AE Côte-Nord Bioenergy Canada Inc. for the production of renewable fuel oil from forest residues at its Port-Cartier facility. Canada’s Minister of Natural Resources, the Honorable Jim Carr, and Laurent Lessard, Quebec’s Minister of Forests, Wildlife and Parks, made the announcement in Port-Cartier.

The Port-Cartier plant will be the first commercial-scale facility of this kind in Quebec. The goal of the project is to convert forest residues into 40 million liters of renewable fuel oil per year. When upgraded into transportation fuels, this will remove up to 70,000 tons of CO2-equivalent emissions per year. Production of renewable fuel oil is set to begin in 2017.

The Government of Canada is supporting the project through a C$27-million investment from Sustainable Development Technology Canada and C$17.5 million from Natural Resources Canada’s Investments in Forest Industry Transformation program.

The Government of Quebec is contributing C$32 million to the project, including C$10 million from Investissement Québec. In March 2016, to ensure the fiber supply for the project, the Quebec Ministry of Forests, Wildlife and Parks reserved 170,000 green tonnes of residues from government forests for the plant.

Trend? There are multiple trend lines in this story.  Sovereign investment, that’s big. Forest residues? That’s bigger. Ensyn technology rolling on to another commercial-scale deployment, that’s huge.

3. Timber industry commits: Canfor, Licella form JV for biofuels project

In March 2017, we reported that the Canadian Minister of Innovation, Science and Economic Development, Navdeep Bains, pledged  a $13M  non-repayable contribution through Sustainable Development Technology Canada that will enable Canfor to further develop and demonstrate Licella’s technology — it will take what is a currently a waste product from its production processes and develop it into a low-cost biofuels product.

Canfor’s new biocrude could be refined by existing refineries into next-generation biofuels and biochemicals that can be easily integrated into conventional fuels markets. Canfor Pulp Products Inc is a top global producer of premium pulp and paper products that is also one of North America’s largest green energy producers — and we reported previously on the project, here and here. The news comes as Bains also tipped an investment of up to $20 million to support clean energy projects at the pre-commercialization stage. This investment, part of a $40-million joint initiative that includes matching funds from the province of British Columbia, will help companies with innovative projects at the prototype, field testing and demonstration stages. Interested parties will be able to submit their applications in early April 2017 to Sustainable Development Technology Canada.

Trend? That’s forest resource being tapped, and that’s Canadian gold. But we also note that federal kick-in – very good sign for renewables that the federal government sees forest mill towns in needless distress – they don’t need a hand-out, they need new technology.

2. Development of Sarnia bioindustrial complex

In March, we reported that Comet Biorefining had successfully closed an investment round to fund its proposed cellulosic sugar production facility using stover and wheat straw as feedstock. PM Equity Partnership, the corporate venture and private equity investment arm of Philip Morris International, led the financing round that was also joined by Bioindustrial Innovation Canada (BIC) and Sofinnova Partners. The investment brings the company closer to its goal of having its 60 million pound per year facility online next year as planned.

Trend? It’s another step forward for the Sarnia biocluster — perhaps the most ambitious and interesting biobased complex, in promise, in the world. Where would BioAmber be without it? Good question, but sure as shooting fish in a barrel they wouldn’t be in Ontario. This cluster drives investment and jobs faster than any other structure out there.

1. Canada to adopt national Low Carbon Fuel Standard

In Canada, Minister of Environment and Climate Change Catherine McKenna announced that Canada will adopt a national clean fuels standard, as an important step for climate action and the growth of Canada’s cleantech economy and green jobs.

This federal leadership builds on the early actions of British Columbia, Oregon and California, and will greatly improve availability of low carbon fuel choices and competition at the pump. A clean fuel standard would be flexible and promote the use of clean technology, lower carbon fuels, and promote alternatives such as electricity, biogas and hydrogen.

The decision to adopt the first national clean fuels standard in the world is consistent with the guidance offered recently by Canadian and US non-governmental and industry organizations. British Columbia has already demonstrated that leadership in clean and renewable fuels can go hand in hand with economic growth. Unlike a price on carbon, which relies on making fuels more expensive to discourage their use, a clean fuel standard will stimulate direct investments in a variety of lower carbon fuel options. A clean fuels standard is particularly effective because all compliance costs are directed back into lower carbon solutions.

Trend? Canada is doubling down on renewable fuels — seeking to do real damage when it comes to road transport carbon intensity. They chosen to follow California and B.C., rather than the US federal approach — and that’s good news for advanced technologies that deliver strong reductions against carbon.

 

Tags:

Category: Top Stories

Comments are closed.