Bioethanol the third way decentral production of biofuels in biorefinery clusters for sustainability and economy Douwe-Frits Broens, Beethanol BV
Beethanol BV - introduction Building medium size bio-ethanol facilities 5000 m3 to 15000 m3/y Our partners a.o. Eugen Schmitt GmbH Brennereitechnik Actemium Engineers Wageningen University (spin off 2006) A&F VPPC Environmental Technology Fuel distributors Co-energy (operations management)
Buyer and owner of ethanol plant Order recommendation (basic design, project mgt, quality ctrl) Cost of ownership (SLA, plant management, R&D, trading) Delivery of equipment Delivery of services Agrologistiek BV Beethanol BV licence agreement Research A&F Wageningen prefered partnerships Equipment Schmitt Engineering Actemium Plant operations Co-energy Trading and logistics Beethanol partners
Our customers Energy producers / users Greenhouse gardeners Biogas investors Institutional investors (green energy) Traders End-product: Small oil companies Feedstock: Wheat traders Arable farmers / cooperatives Existing ethanol producers (Germany)
Beethanol BV status Project Decentral bioethanol in biorefinery clusters implementation in North Netherlands Partners: Provinces Groningen/Friesland LTO Rabobank International Smit Kwekerijen, Sappemeer SPNA, Munnekezijl Upscaling beet related technology (WUR A&F) Involved in 6 other optional locations in NL Expanding into Germany Planning LT research project WUR
Bioethanol the third way Perspective Sustainability Some technology Economy Conclusion
Bright future for biofuels Headlines 2012 More than 50% of transport fuel from biomass Farmers and smallholders finally get their pay Consumers paying fair prices for energy and food Small biorefineries drive green innovations Nordrheinische Bussen auf Nordrheinischer Sprit Fossiele brandstof voor de rijken
Major challenges Headlines 2012 Oil price above $200: NYE in mourning China fuels the biofuels from Africa Old economy multinationals facing hard times Second generation biofuels never paid off WTO: new exporting countries dominate prices High straw prices: investors face bankruptcy Serious energy savings enforced by energy prices
With hindsight Biofuel breakthrough: Sustainability was not the issue Technology was not the issue It was the economy, stupid
Bioethanol the third way Perspective Sustainability Some technology Economy Conclusion
Sustainability is not the issue All biofuels more sustainable than fossil fuels On all criteria The only available alternative in transport For decades to come We may strive for better sustainability but in the end we need them all Now let s talk about sustainability
Bioethanol: renewable? CO 2 Fields Fuel stations
The doom stories CO 2 Fields Fuel stations NPK fossil NPK Old fashioned picture (maize, USA)
Large scale models Sugar cane / renewable energy Fields fossil Fuel stations Wheat, maize / renewable energy Fields NPK fossil NPK Fuel stations
Best available: decentral model The third way (local for local) Fields Fuel stations The third way (import from smallholders) Fields fossil Fuel stations
Some references Footprint (m2 y/kwh) 140 120 100 80 60 40 20 0 petrol diesel EtOH 60000 m3/y DDGS EtOH 5000 m3/y biogas, cogeneration Prof. Friedl, Wien (Berlin Mai 2007)
Some references Superior CO 2 emission savings 9909 ton less than traditional when EtOH production capacity of 5000 m3 (own calculations)
Bioethanol the third way Perspective Sustainability Some technology Economy Conclusion
CO 2 Beets, wheat, potatoes, maize, Minerals Biogas Green power Steam 130ºC Pulp Food CO 2 Residual heat 60ºC Ethanol Sugar Feed (c)tomo.yun (www.yunphoto.net/hl/)
Decentral production = smart solutions Use of locally produced exergy Clusterwise integration Material cascades (biorefinery) Energy cascades Zero waste Zero soil degradation Zero fossil fuels
Decentral production = available technology Biorefinery Combination of 1 st and shallow 2nd generation Many improvements possible On the field In the core process In neighbour processes (spin-off) Gesloten Kas Towards bio-economy / biochemicals Introduce deep 2nd generation on the fly Develop from running cash flow This is what investors like
Bioethanol the third way Perspective Sustainability Some technology Economy Conclusion
Feedstock: the name of the game Cost price breakdown Wheat Beet Enzymes, yeast Electricity Gas Water (netto) -/- dehydration Transport wheat Transport beet Transport ethanol Labour Depreciation Maintenance Overhead Insurance Rents Interest
Where to put my money? First generation bioethanol, e.g. wheat buyers market 1955-2005 95/tonne suddenly sellers market 2006 250/tonne world wide harvest failure 2006 (2007) demand China, Middle East up-up-up result: Abengoa, Südzucker reselling wheat contracts and stop producing ethanol long run equilibrium 170/tonne? BE
Where to put my money? Second generation bioethanol (fibers) Technological risks Not yet ready: when?? Only feasible on large scale (single feedstock) Feedstock = straw Will not remain cheap - price risks Logistically impossible Feedstock = wood Conflicts with nature - environmental risks
Decentral production = smart solutions Flexible on feedstock All feedstock that is locally available Also heavy feedstock like beets (short cycles) Optimal margin per hectare Risk reduction Small additional investments Introduction new (2 nd gen.?) tech on the fly
Decentral production = smart solutions Flexibility reduces price risks Result [ /y] 3000000 2000000 1000000 Wheat alone Wheat and beets 0 75 95 115 135 155 175 195 215 Wheat price [ /ton]
Decentral production = smart solutions Local optimal use of side products Up to 25% of total revenue Outside integration cheaper than inside Driver for economy and innovation of rural areas Farmers may own the installations Innovations by reinvesting cash flow Headstart for bio-economy Employment and value added within the region
Bioethanol the third way Perspective Sustainability Some technology Economy Conclusion
Decentral production Smart solutions Smart local combinations Cheap local energy Shallow 2 nd generation technology The economic alternative Less risk through flexibility in feedstock Up to 25% revenues from side products Driver for rural bio-economy (Europe and 3d world) Building scale through repetition: learning curve
Decentral production The sustainable alternative Zero fossil fuel Zero soil degradation Payoff to smallholders in EU and 3d world Available as of today Feasible with available technology Many improvement options Low investment threshold
Policy is second worst risk Poldermodel dominated by majors / old economy : No level playing field to farming interests No level playing field to innovators Backfiring policies: Biofuel quota block high blend innovations Palm oil disaster: no volume orientation for decades to come Innovation MEP disaster: investment climate spoilt for decades to come New sustainability criteria are made up in close cooperation with fossil parties not applied to fossil parties, but to new alternatives Supportive lobbies:?? Environmentalists: confused / confusing Agriculture: very weak Wageningen: confusing
We may strive for better sustainability But in the end we need all biofuels we can get Beethanol BV, Douwe-Frits Broens call 0031 6 28848720 e-mail df@agrologistiekbv.nl