Answers to Your Biofuels, Biopower and Biomaterials Questions

August 10, 2011 |

Land-use, economics, infrastructure policy for biofuels? You’ve been asking – here are the latest answers to real questions from the field.

At the Biomass 2011 conference in Washington, a lively debate session provided a bumper crop of questions from the audience – too many to answer at the time. At the same time, it offers us an opportunity to reach into the reader mailbag as well, and provide answers to real questions posed by enthusiasts, policymakers, producers and researchers in the field.

Land use and sustainability

Q. How can we preserve the land needed to achieve the 1 billion tons? What regulations? Other incentives and solutions to the problem of land needed to give land-owners a reason to keep ag and forest in production of energy crops as well as food, feed and fiber – i.e. the whole barrel.

A. Generally speaking, good prices for feedstocks and existing zoning regulations for agricultural land will sustain the billion tons of biomass.

Q. What approach should be used to reduce residential/commercial development/destruction of agricultural and forest land?

A. Anyone who lives near the city/country line – such as you can see in the southwestern Chicago suburbs, can see the steady conversion of land to residential use. But it’s minuscule. The whole urban land footprint? 60 million acres in the 2002 land survey, or far less than the corn or soybean crop footprint.

Q. Biomass resources are abundant but not unlimited. Should most biomass be used for power or fuel, or split 50/50?

A. Market forces will sort this out, rather than central planning – but generally speaking, where there is a high dependency on heating oil, expect a greater share of biomass to go to the power side. Where coal or low-cost gas is king, expect biomass to find more opportunities in fuels and chemicals.

Q. Isn’t demand/output/production different than environmental impact –  E.g. a poor harvest of 10 units of wood could have far more impact than a 100 unit harvest using BMPs, reduced impact logging techniques, etc. Wouldn’t higher economic returns for the biomass allow better practices?

A. Yep. Generally speaking, higher returns on biomass, when paired with good zoning laws and high land prices, have been shown to slow deforestation and to promote intensification of agriculture, instead of land conversion. High farm prices are good for farmers, and generally good for consumers – especially in a world where there is only nine cents of corn in a $4 box of corn flakes.

Q. Assuming we won’t see sustainability standards for fossil energy, what should the bioenergy industry do – more, less, existing level of scrutiny on environmental impacts?

A. All projects should meet the same environmental impact standards, which are generally local in character. Projects that replace fossil fuels should, at a minimum, reduce carbon and be available at parity prices. Projects that meet an exacting low-carbon standard should have access to economic incentive funds for their construction, but not necessarily their ongoing operation.

Economics

Q. What will it take for biomass to electricity to become cost competitive as a stand alone IPP. As opposed to being for self-generation or co-firing?

A. Depends on the local cost of biomass and power. Generally speaking, co-firing is a good equation for the time present. As biomass producers ratchet down the costs, the co-firing mix can change; and with lower costs, biomass-only projects have a better chance of becoming economically feasible.

Q. The point missing from the discussion is how much total energy can we derive from biomass? 1 billion tons of biomass – 16 percent of current US energy consumption. Algae is very, very expensive energy. How can biomass really make a difference in the US or elsewhere? Is it the whole solution?

A. Two items to consider here.

One, important to understand energy as a mix – the same criticisms could be applied to coal, nuclear, or oil, none of which supply an overwhelming percentage of energy needs, all by their onesy.

Two, important to see biofuels as primarily a replacement for transportation fuel; there, the numbers could easily surpass 50 percent displacement of current fuels, in the long term. At current levels, that could make the US energy independent – a worthy energy policy goal.

For other countries that are far less energy intense, the potential of biomass to replace 50+ percent of the current energy mix is real, in the long term. But it is only part of the story of the shift towards energy efficiency and more renewables.

Q. If cellulosic ethanol cannot ever be cost competitive, how can a drop-in fuel ever be cost effective since it requires an even more complex production process?

A. Drop-in fuels aren’t always as complex as cellulosic ethanol, for one; cellulosic ethanol can make money, at scale, for two.

Q. Has there been an authoritative, well-to-wheels economic study on whether biomass power or biofuels provides more bang for the buck, i.e. more energy density per dollar for the consumer?

A. Generally, biomass economics are not about energy density but of the value of the molecules produced.  To use an example from the world of metals, lead is more dense than silver, but less valuable. The overall highest value is in conversion to high value molecules – for use in internal combustion engines, for example, or use in green chemistry. But biomass can support a wide range of uses – depending on the geography,

Transition to a bio-based economy

Q. If we were not in a “too scared to talk” period, what should we as citizens do to guide public opinion?

A. Talk up the economic benefit that flows from locally-produced fuels – and the greening of the local job force.

Q. How do you address the corrosivity issue for infrastructure, like storage tanks?

A. By replacing old storage tanks, in their normal replacement cycle, with new materials that resist corrosion.

Q. Hydrocarbons v ethanol. Where are the Chinese making their bet?

A. For now, ethanol.

Policy

Q. Why has the US ethanol industry fought so hard against Brazilian ethanol, when encouraging its entry would create a more compelling story that would encourage the development of an ethanol-compatible infrastructure nationwide?

A. The US ethanol industry has, generally speaking, opposed Brazilian ethanol because it cuts into their business. Having said that, the tariff expires at the end of the year, there is virtually no political will to renew it, and with the rise in world sugar prices, US ethanol is currently cheaper.

Ironically, with expanded demand for low-carbon fuels next year under the RFS, it is entirely possible that the US will import Brazilian ethanol because of the low carbs, and Brazil will import US ethanol because of the low prices. If you see a US-bound sugarcane ethanol tanker passing a Brazil-bound corn ethanol tanker, it is a sign of the crazy times we live in.

Q. With vast regional differences from Midwest to Coastal Markets – shouldn’t the states take more initiative to adopt the infrastructure best for them?

A. Yep.

Q. How can you get all of the biomass industry organizations to work together (with one voice) on biomass energy policy?

A. On broad issues, such as protection of the Renewable Fuel Standards and broad renewables mandates, they already are. The more that policies pick winners and losers, in the details of regulation, the more balkanized the trade groups become.

Q. Isn’t it true that power companies can transfer costs of biomass as feedstock to rate payers while recuperation of transportation fuel costs are restrained by the cost of oil? Doesn’t this make an uneven field of play?

A. Yep.

Q. What about varying capital expense for corn and cellulosic? Can lower operating costs make up the difference?

A. Cellulosic biofuels are more expensive on the front end, no doubt about it – as much as $6 per gallon of capacity in added capital expense, according to the USDA. The savings on feedstock, at expected current prices, are around $1.70 per gallon (using ZeaChem’s 135 gallons per ton, $60 per ton woody biomass costs, and current corn ethanol feedstock costs). So, for sure, cellulosic biofuels can make up the difference – but the break-even point depends on the operating costs of the specific technologies.

Q. There are clean and green biofuels, but also dirty biofuels. Biofuels, and biopower, can be worse than gasoline & coal! Given we have an essentially limitless demand for energy, a finite supply of forest, if it is worse that gasoline, what is gained? Why not regulate the good, and throw out the bad?

A. Low-carbon fuel standards, and effective zoning, are generally are the answer. As long as biofuels are made from appropriate land resources, are available at parity cost with existing fuels (fully costed for infrastructure), and provide a measureable carbon benefit, that should be a winning formula for the environment and the pocketbook.

Q. Has the EPA approved the use of butanol in automobiles. How about the car companies?

A. There is an existing waiver granted to Dupont some time ago for its biobutanol technology, for up to 16 percent blended biobutanol content.

Q. What is your view of energy taxes based on carbon footprint, energy security costs or sustainability?

A. Generally speaking, most biofuels producers favor carbon taxes for the obvious reasons of climate protection, but carbon taxes are not wildly popular and take far more careful thinking than has been shown in legislation around the world – to work economically and to persuade voters.

Q. Isn’t the government mandating E30 forcing the government to pick a winner?

A. Yep.

 

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