<body> -------------------
Contact Us       Consulting       Projects       Our Goals       About Us
home » Archive » Bioenergy_economics
Nature Blog Network

    Spanish company Ferry Group is to invest €42/US$55.2 million in a project for the production of biomass fuel pellets in Bulgaria. The 3-year project consists of establishing plantations of paulownia trees near the city of Tran. Paulownia is a fast-growing tree used for the commercial production of fuel pellets. Dnevnik - Feb. 20, 2007.

    Hungary's BHD Hõerõmû Zrt. is to build a 35 billion Forint (€138/US$182 million) commercial biomass-fired power plant with a maximum output of 49.9 MW in Szerencs (northeast Hungary). Portfolio.hu - Feb. 20, 2007.

    Tonight at 9pm, BBC Two will be showing a program on geo-engineering techniques to 'save' the planet from global warming. Five of the world's top scientists propose five radical scientific inventions which could stop climate change dead in its tracks. The ideas include: a giant sunshade in space to filter out the sun's rays and help cool us down; forests of artificial trees that would breath in carbon dioxide and stop the green house effect and a fleet futuristic yachts that will shoot salt water into the clouds thickening them and cooling the planet. BBC News - Feb. 19, 2007.

    Archer Daniels Midland, the largest U.S. ethanol producer, is planning to open a biodiesel plant in Indonesia with Wilmar International Ltd. this year and a wholly owned biodiesel plant in Brazil before July, the Wall Street Journal reported on Thursday. The Brazil plant is expected to be the nation's largest, the paper said. Worldwide, the company projects a fourfold rise in biodiesel production over the next five years. ADM was not immediately available to comment. Reuters - Feb. 16, 2007.

    Finnish engineering firm Pöyry Oyj has been awarded contracts by San Carlos Bioenergy Inc. to provide services for the first bioethanol plant in the Philippines. The aggregate contract value is EUR 10 million. The plant is to be build in the Province of San Carlos on the north-eastern tip of Negros Island. The plant is expected to deliver 120,000 liters/day of bioethanol and 4 MW of excess power to the grid. Kauppalehti Online - Feb. 15, 2007.

    In order to reduce fuel costs, a Mukono-based flower farm which exports to Europe, is building its own biodiesel plant, based on using Jatropha curcas seeds. It estimates the fuel will cut production costs by up to 20%. New Vision (Kampala, Uganda) - Feb. 12, 2007.

    The Tokyo Metropolitan Government has decided to use 10% biodiesel in its fleet of public buses. The world's largest city is served by the Toei Bus System, which is used by some 570,000 people daily. Digital World Tokyo - Feb. 12, 2007.

    Fearing lack of electricity supply in South Africa and a price tag on CO2, WSP Group SA is investing in a biomass power plant that will replace coal in the Letaba Citrus juicing plant which is located in Tzaneen. Mining Weekly - Feb. 8, 2007.

    In what it calls an important addition to its global R&D capabilities, Archer Daniels Midland (ADM) is to build a new bioenergy research center in Hamburg, Germany. World Grain - Feb. 5, 2007.

    EthaBlog's Henrique Oliveira interviews leading Brazilian biofuels consultant Marcelo Coelho who offers insights into the (foreign) investment dynamics in the sector, the history of Brazilian ethanol and the relationship between oil price trends and biofuels. EthaBlog - Feb. 2, 2007.

    The government of Taiwan has announced its renewable energy target: 12% of all energy should come from renewables by 2020. The plan is expected to revitalise Taiwan's agricultural sector and to boost its nascent biomass industry. China Post - Feb. 2, 2007.

    Production at Cantarell, the world's second biggest oil field, declined by 500,000 barrels or 25% last year. This virtual collapse is unfolding much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos. Wall Street Journal - Jan. 30, 2007.

    Dubai-based and AIM listed Teejori Ltd. has entered into an agreement to invest €6 million to acquire a 16.7% interest in Bekon, which developed two proprietary technologies enabling dry-fermentation of biomass. Both technologies allow it to design, establish and operate biogas plants in a highly efficient way. Dry-Fermentation offers significant advantages to the existing widely used wet fermentation process of converting biomass to biogas. Ame Info - Jan. 22, 2007.

    Hindustan Petroleum Corporation Limited is to build a biofuel production plant in the tribal belt of Banswara, Rajasthan, India. The petroleum company has acquired 20,000 hectares of low value land in the district, which it plans to commit to growing jatropha and other biofuel crops. The company's chairman said HPCL was also looking for similar wasteland in the state of Chhattisgarh. Zee News - Jan. 15, 2007.

    The Zimbabwean national police begins planting jatropha for a pilot project that must result in a daily production of 1000 liters of biodiesel. The Herald (Harare), Via AllAfrica - Jan. 12, 2007.

    In order to meet its Kyoto obligations and to cut dependence on oil, Japan has started importing biofuels from Brazil and elsewhere. And even though the country has limited local bioenergy potential, its Agriculture Ministry will begin a search for natural resources, including farm products and their residues, that can be used to make biofuels in Japan. To this end, studies will be conducted at 900 locations nationwide over a three-year period. The Japan Times - Jan. 12, 2007.

    Chrysler's chief economist Van Jolissaint has launched an arrogant attack on "quasi-hysterical Europeans" and their attitudes to global warming, calling the Stern Review 'dubious'. The remarks illustrate the yawning gap between opinions on climate change among Europeans and Americans, but they also strengthen the view that announcements by US car makers and legislators about the development of green vehicles are nothing more than window dressing. Today, the EU announced its comprehensive energy policy for the 21st century, with climate change at the center of it. BBC News - Jan. 10, 2007.

    The new Canadian government is investing $840,000 into BioMatera Inc. a biotech company that develops industrial biopolymers (such as PHA) that have wide-scale applications in the plastics, farmaceutical and cosmetics industries. Plant-based biopolymers such as PHA are biodegradable and renewable. Government of Canada - Jan. 9, 2007.

Creative Commons License

Thursday, November 09, 2006

Putin's grip on Europe: aggressive gas politics might prompt biogas future

The Dutch Peak Oil foundation is publishing an interesting series of articles on Europe's dependence on Russian natural gas. In part one, it shows how Russia is playing out its natural gas policies against former Soviet republics and satellites in Eastern Europe. This is a first step in a strategy aimed at strangling Europe into ever-greater energy dependency. Below, we will show that in the long-run this might usher in an era in which Europe radically chooses for alternatives, such as biogas. When Ulrich Schmack, an energy advisor to the German government, recently said that biogas might replace all Russian gas imports by 2030, he obviously based his remarkable statement on the threatening developments in Russia (earlier post).

The mechanism with which Russia uses natural gas as a geopolitical weapon is easy to understand and shows how the country is gradually becoming a true 'petropolitist' state. Once a supply contract for gas ends, Russia forces its clients into a simple 'choice': under the new contract you either pay the European market price for gas (which stands at US$ 250/1000m³) or you hand over a part of your infrastructure to Russia's state-owned companies.

The geopolitical and economic goals behind this strategy are two-fold: Russia wants to get total control over gas-pipelines to Europe, and secondly, it wants more cash-income so that it can tap new, difficult gas fields because production at its older fields is rapidly declining. All the while, Putin knows that the former Soviet-states and satellites can never pay the high European market price. This way, Russia can subject them politically (overview of how this strategy has operated over the past two years; the table showing the difference in prices between 2005 and 2006 nicely illustrates how Russia is systematically applying the same technique for all its new 'satellites').

Biogas to the rescue?
Europe feels that Russia is gradually building a trap of dependency and that its long-term energy security is steadily being jeopardized. This became apparent once again during the recent EU-Russia energy summit in Lahti (earlier post), which made it clear to all stakeholders that Russia will not play by the rules Europe prefers (open and transparent markets, shared control over infrastructures, the possibility for European companies to invest in Russia's energy resources,... Europe favors 'interdependency', Russia is tilting towards creating 'dependency').

Given the dire outlook of becoming overly reliant on an a single petropolitist state, it would be unwise for Europe not to look into alternatives. Because there are realistic pathways out of this dependency. One of the best candidates for Europe to diversify its energy portfolio is biogas, either locally produced or based on feedstocks that are internationally sourced:
:: :: :: :: :: :: :: :: :: :: ::

Recently, the German federal government held its own energy summit in which strategizing around renewables played a major role. Ulrich Schmack, co-founder of the world's largest biogas firm, Schmack Biogas AG, was invited to act as High Representative for Renewable Energies. At the eve of the summit, he made a surprising but visionary remark by saying that Germany can entirely cut Russian gas imports by 2030 by relying on biogas instead.

Schmack assessed Germany's biogas potential and its current investments in the green fuel and concluded that at the current pace of technological advancements and investments, the country would be producing 40 billion cubic metres of biogas by 2030. "At the end of 2005, Germany produced 10.5% of all its energy from renewable resources. Each year, the share increases by 2 to 3%. The math is simple: by 2030 and at this pace, green energy will have replaced a huge amount of fossil energy."

In Germany and elsewhere in Europe, biogas is already being produced on a massive scale using dedicated biogas energy crops (such as easily fermentable energy maize, or specially bred tropical grasses, with interesting experiments by the North-Sea Bioenergy Partnership). Large investments are being made in the sector, and some countries are already starting to mix the renewable gas into the natural gas grid. High-tech innovations are making this possible (amongst those biogas sensors, and algae-systems to purify biogas). And at current gas prices (€200/1000m³), the green alternative is already highly competitive.

Sound data and realistic projections made Schmack conclude the following: "In 2030 Germany will produce 40 billion cubic metres (1.4 trillion cubic feet) of biogas per year. By that time we don't need any gas from Russia any longer. The billions of Euros that flow out of the country now to Saudi Arabia and Russia, stay here and will benefit our economy." This way, "security of supply and buffers against price fluctuations are guaranteed", Schmack adds.

It seems that for Germany at least, a radical switch away from Russian natural gas, to locally produced biogas is not unrealistic. But what for the rest of Europe?

Biogas feedstocks as an international commodity
Biogas is obtained by the anaerobic fermentation of organic matter - either household, municipal, agricultural or industrial waste. But more and more, biogas is being produced from dedicated energy crops. Like all biofuel crops, dedicated biogas crops require land.

So if we start to think in terms of how much land for energy crops is actually available in Europe, we can quickly conclude that the continent does not have too much of it. Therefor, the continent might start to look elsewhere to source biogas feedstocks. As for liquid biofuel feedstocks, the Global South has competitive advantages over Europe when it comes to producing the raw material for the green gas: abundant land, favorable agro-climatic conditions, large rural populations who would gladly become energy producers.

Biogas feedstocks might be densified locally in the South, and transported to Europe by ship. As the IEA Bioenergy Task 40 study group found, even if such long-distance trade is involved, the competitive advantage of the South remains (earlier post).

In short, Europe's biogas future might be coupled to the development of bioenergy production zones in the South. For the production of liquid biofuels, such a strategy is mutually beneficial; no doubt the same holds for the production of biogas feedstocks. By thus diversifying its energy portfolio and its supplies, Europe can considerably increase its longterm energy security.

Over the long-run, Putin's aggressive natural gas politics might work against Russia; if the situation keeps deteriorating, Europeans will start considering alternative solutions. For the time being these alternatives might seem far-fetched, but on closer examination they are becoming feasible and even necessary. Ulrich Schmack, for one, is already convinced of their strength.

Thanks William!


Post a Comment

Links to this post:

Create a Link

<< Home