Biomass supply chain issues for power

Transcription

1 Biomass supply chain issues for power Richard Taylor APGTF Workshop, London 13 th March 2014 Strategic thinking in sustainable energy

2 E4tech: Strategic thinking in sustainable energy International consulting firm, offices in UK and Switzerland Focus on sustainable energy Established 1997, always independent Deep expertise in technology, business and strategy, market assessment, techno-economic modelling, policy support A spectrum of clients from start-ups to global corporations

3 E4tech involvement in biomass supply chains and CCS < Biomass availability DfT Biomass availability CCC - Biomass for aviation DECC Biomass prices Land use change analysis for multinationals DfT - Modes EU Auto-fuel project ETI Energy crops Power & CCS ETI CCS model toolkit ETI BioCCS (TESBIC) Due diligences & shadow engineering for investors Logistics Wood fuel supply in Chile CCC Best use of bioenergy model Supply chain of SNG for oil major ETI Biomass Value Chain Model (BVCM) GIZ Serbia Policy & regulation UK RTFO carbon and sustainability reporting Carbon calculators for biomass DfT ILUC assessment Bioenergy TINA 3

4 Issues Availability and security of supply Cost and stability Logistics and form Location (resource, demand, infrastructure) Quality Sustainability 4

5 Domestic availability or reliance on imports? Wide range of estimates, even for domestic resources Key factors are availability of land, and global competition for bioenergy UK wastes current dominate, but will decline Future heavily dependent on energy crop ramp-up Source: UK Bioenergy Strategy 5

6 Domestic energy crops could play a significant role in the future UK energy system Willow & Poplar (SRC) favoured in the wet West, Miscanthus in the warm South Average yield is ~10 odt/ha/yr, accounting for the yield gap Current 12kha planted is mainly on arable land, but yields far from optimal. Location driven mainly by end-user demands UK future potential for 7 35 Modt/yr (based on Mha of land). At most 0.4 Modt is achievable by 2020 Miscanthus Willow Sources: Natural England (2013), Rothamsted Research, Southampton University 6

7 ... and could be competitive with imports Significant potential between 45-65/odt (ex-farm production costs) Competitive with imported chips & /odt (strongly dependent on global market conditions & shipping costs) Sources: Argus Biomass Markets (2013), TSEC Biosys project 7

8 Global biomass trade dominated by a few routes. Logistics costs vary, but can be >50% traded price 15/odt 20/odt Source: Argus (2013) 8

9 Wood pellets are the main commoditised resource, and the industry is expected to more than double by production (Mt) ROW ROAsia China Russia North America 8 4 EU consumption (Mt) Source: IEA Task 40, AEBIOM 9

10 Imports of densified biomass will play an important role Pelletisation and torrefaction add significant costs which need to be carefully justified in relation to end use markets and logistics Houston (US) Hull (GB) : 16,500 km Houston (US) Hull (GB) : 9,343 km Bergen (NO) Hull (GB) : 839 km Source: E4tech analysis 10

11 The evolution of CO 2 networks will also have implications for biomass logistics CO 2 clusters Source: AMEC As highlighted by UK Gov s Bioenergy Strategy, CCC s Best Use of Bioenergy work, and ongoing work at the ETI: biomass+ccs is expected to have a major role to play in the energy sector Likely cluster(s) for CO 2 sequestration may not be located close to where the greatest domestic biomass potential exists CO 2 piping costs are not insignificant there will be trade-offs between moving biomass or CO 2. However, these CO 2 clusters are likely to be near major port facilities, hence ideal for imported biomass 11

12 Quality - not all biomass is born equal Biomass conversion technologies may impose limits on ash and impurities in the feedstock Straw Willow Miscanthus Forestry Chlorine Sulphur Nitrogen Potassium Total ash Sub-optimal (in terms of biomass feedstock cost) blending may be required to comply with technology operating limits Other routes that avoid direct combustion (e.g. gasification-based pathways) may become interesting for feedstocks with high impurities 12

13 Sustainability the rules of the game Since 1 April 2011, biomass electricity generators >50kW e have been required to report against the following sustainability criteria: minimum 60% GHG emission saving for electricity generation using solid biomass or biogas relative to fossil fuel general restrictions on using materials sourced from land with high biodiversity value or high carbon stock including primary forest, peatland and wetlands Only reporting at present is mandatory. This allows self-assessment, use of Voluntary standards, and Optional verification However, from April 2014, solid & gaseous generators >50kW e will also have to provide annual profiling data, and report monthly against a new Timber Standard. Those >1MW e will also have to provide an independently verified sustainability audit report each year, and can no longer use default values in their GHG reporting (have to use actual values). 13

14 Different chains can have very different GHG emissions kgco 2 e/t/km for wood chip Road Rail Ship Source: UK Bioenergy Strategy 14

15 Thank you for your attention For further questions please contact: Richard Taylor Ausilio Bauen 15