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    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.

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Saturday, December 02, 2006

Japanese company to produce ethanol from oil palm waste

Earlier we referred to a study we're preparing on the technical potential and energy balance of (next-generation) liquid biofuels made from tropical crops and biomass residues under several technology development scenarios. In a small article on the study, we pointed out that the African oil palm - the oils of which are a major biodiesel feedstock - is also the crop that potentially yields more ethanol than any other feedstock. New varieties of the plant yield up to 7000 liters of palm and palm kernel oil. But after the extraction of these oils, a vast amount of biomass remains: palm fronds, empty fruit bunches, fibre, press cake, palm kernel shells and palm trunks (harvested after the useful life of a tree). This biomass - some 50 tonnes per hectare per annum - is currently treated as 'waste' and most often burned in the open air. Some of it (the kernel shells) is being shipped to the EU, where it is co-fired with coal (check out the Database of Biomass Cofiring Initiatives, prepared by the IEA Bioenergy Task 32 on Biomass Combustion and Co-firing, which comprises around 150 initiatives from around the globe where biomass is co-fired in large coal utility boilers. Palm kernels for this purpose are notably exported to the Netherlands.)

However, this 'waste' biomass can be converted into liquid fuels instead of being burned as solid biomass in power plants (or as a feedstock for the production of biogas). Several conversion paths are possible for the production of transport fuels: thermochemical conversion (gasification after which the gas is turned into a 'synthetic' biodiesel via the Fischer-Tropsch process) or biochemical conversion, whereby specially designed enzymes break down the cellulose contained in the biomass to release sugars that can be fermented into ethanol. So besides yielding some 5000 to 7000 liters of biodiesel, the African oil palm's waste stream can be used to produce a vast quantity of ('second generation') ethanol or synfuel.

The reason why we come back to this earlier article is simple: a Japanese company has meanwhile decided to conduct an economic feasibility study on the idea. Interested in utilising the enormous agricultural waste stream generated by the oil palm industry in Malaysia to produce cellulosic ethanol, Mitsui Engineering recently sent an investment team to the country to undertake research scheduled to be completed early next year.

The company's spokesman told a local newspaper: "If found feasible, we will build a pilot plant costing about 3 million US dollars by networking with a local partner from the oil palm sector for the commercial production of bio-ethanol." Mitsui plans to build the pilot in the next two years and commence testing and trial operation by 2010, added the spokesman.

He noted that the development and commercial production of biofuel from oil palm in Malaysia has so far focused on biodiesel only, which is suitable for diesel engines but not applicable to petrol-powered vehicles: "When demand for biodiesel sharply increases, the use of palm oil for biofuel could constitute a competition with its current use mainly in the food industry," he said. The extraction of bioethanol from oil palm wastes can do away with such worries, said the spokesman, adding that the conversion efficiency of turning waste palm trunk fibres into ethanol is around 30%:
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In Malaysia, a huge quantity of felled old oil palm trunks are discarded during replanting. An oil palm plant has a productive life of about 25 years, after which it is felled and replaced by new seedlings. Some 4% of the total palm hectarage in Malaysia is replaced this way, each year, amounting to anywhere between 12 and 16 million tonnes of cellulose-rich biomass from trunks alone. Add some 80 million tonnes of biomass from fruit bunches, fronds, press cake and kernels that is generated each year.

The organic constituents of these different types of biomass vary, with some being richer in cellulose than others. But most of them contain more than 50% of easily extractable cellulose and less than 30% of lignin. At an average conversion efficiency of 30% applied to this stream of cellulose-rich biomass, it is not difficult to see that this waste resource holds considerable potential for the production of cellulosic ethanol. The numbers are for Malaysia only. Indonesia, which will surpass Malaysia's palm hectarage next year, has an even larger unused feedstock resource.

The study we are currently preparing deals with the technical potential and energy balance of next-generation liquid biofuels made from tropical and sub-tropical crops and residues only. But the news that a company is already studying the matter from an investment perspective, is an incentive for us to go beyond the technical potential and to study the economic potential as well (in a follow-up). We are looking forward to news on Mitsui's feasibility study, and as soon as it arrives, we will report back on it.

New revenues, less deforestation
The news is important from an environmental perspective as well. The palm oil industry in South East Asia is rightly criticized for driving deforestation. The industry itself is trying to counteract some of the critiques by stressing its investments in crop improvement research and in focusing on getting smallholders to replace old trees with new, high-yielding varieties so that less land and forest has to be converted into plantations.

Now if the biofuel industry in this part of the world were to start utilising the vast amount of unused 'waste' biomass for the production of ethanol, an entirely new revenue stream would emerge, both for smallholders and large estates. This would greatly reduce the stress on forests, which is most often driven by the smaller plantation owners who prefer to convert forest into new land, because they're poor. Unlike large estates who can invest in new palm varieties, in the best plantation management practises and even in downstream sectors, smallholders often only have the single worst option before them: cutting down trees to plant more low-yielding palms.

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Indonesian state power company to run 114 power plants on biofuels

In an effort to reduce its dependence on expsensive oil, beginning next year Indonesia's state-owned power firm Perusahaan Listrik Negara (PLN) will start using locally produced biofuel to fire 114 small- and medium-scale power plants around the country. PLN chief commissioner Alhilal Hamdi said in Jakarta that the plan had been approved following the success of pilot projects for the use of biofuel in an 11 MW plant in Lampung and a 1.5 MW power plant in Nusa Penida, Bali, earlier this year. "Next year, we will start using biofuel in West Nusa Tenggara, East Nusa Tenggara and South Kalimantan," said Alhilal.

In 2004, PLN generated some 120 TWh of electricity, serving 31,000 households and 2200 businesses and large industries. The bulk of its power is generated from oil, coal and natural gas (see graph).

Pure plant oil
Unlike other power companies who are increasingly using solid biomass (agricultural and forestry) to fuel their electricity generating plants, PLN relies on pure plant oil (PPO). On the sidelines of a media gathering to promote the use of PPO for power generation, Alilhal, who is also the head of the Indonesian government's biofuel development committee, explained the rationale behind it. PPO, made from palm oil, is being used to fire the Lampung power plant. He said that power generated by this plant, which used a blend made up of 80% PPO and 20% diesel, was 300 rupiah (3 US$ cents) per KWh, a third below the average cost of electricity produced from oil-based fuels.

"We hope we can save more using this alternative energy source, and therefore help reduce the government's subvention," Alhilal said. According to a review conducted by the State Ministry for Research and Technology's technological assessment and application agency (BPPT), the government could cut the subsidies it pays to PLN to 2.56 trillion rupiahs per year if greater use were made of PPO. In addition, PPO, which can also be blended with kerosene, could cut the amount the government has to pay on the kerosene subsidy to 1.66 trillion rupiahs per year, the review says.

Unggul Priyanto of the BPPT said that the use of PPO would work out much cheaper than diesel or even biodiesel. "The price of diesel and biodiesel for industrial use stands at about 6,000 rupiah per 1000 liters, while palm oil-based PPO is only 4,300 rupiah. This is why the greater use of PPO could save a lot of money," he said:
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He explained that the cost of PPO was lower as it used nothing except pure vegetable oils, either palm or jathropa oil, without the need for an additional processes or chemical additives, unlike in the case of biodiesel, which required the addition of methanol and glycerin.

Commenting on the question of whether PPO or biodiesel was preferable, Alhilal said that both were alternative energy sources that had important roles to play in helping the country overcome its dependence on oil.

In September, as part of its bioenergy crash program (earlier post) the government pledged to allocate nearly 500,000 hectares of land next year to encourage the development of the country's fledgling biofuel industry.

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China's first biomass-fired power plant goes into operation

China's first direct biomass-fired power plant, with an installed generating capacity of 25,000 kilowatts, has gone into commercial operation in east China's Shandong Province.

Located in Shanxian County, the 300 million yuan (€28.7/US$35.7 million) plant burns 150,000 to 200,000 tons of agricultural and forestry residues: cotton stalks, tree branches, orchard waste and wood chips.

The plant's capacities and benefits can be summarised as follows:
  • It generates 160 million kilowatt-hours of electricity a year, saving the equivalent of 400,000 tons of coal.
  • Local farmers and biomass enterprises are expected to earn about 40 million yuan (€3.8/US$5.1 million) from the project each year.
  • The 25,000-kilowatt biomass-fired power plant is carbon-neutral in that the CO2 it emits gets taken up by new biomass growth. Annually the plant saves some 100,000 tons of CO2, an amount that would be emitted by a thermal, coal-fired plant of a similar size.
  • The ash of the burned biomass is high quality potash fertilizer.
The Chinese government has attached great importance to the development of clean energy projects in recent years. It is currently refining (earlier post) its ambitious bioenergy plans (earlier post), and technical cooperation with foreign research agencies, companies and governments on renewable energy projects is speeding up (on biomass co-firing in coal-plants, see here; on China's interest in German biomass-to-liquids technology, here; on a European energy company's contract to buy carbon credits from green energy firms in China, here and on bilateral cooperation agreements with Malaysia, the Philippines, the Greater Mekong Delta Region or Nigeria).

Large number of biomass plants planned
Even though China's growth has been powered almost entirely by coal, the most climate destructive fossil fuel, the People's Republic knows that this situation is untenable in the long-run. Therefor it has approved the construction of over 30 biomass power plants, some which are under construction and some will begin construction by the end of the year:
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The Shanxian plant is funded by the National Bio Energy Co., Ltd., a subsidiary of the State Grid Corporation of China, which is in charge of the power grid covering northern China, or the areas to the north of the Yangtze River. State Grid has been given the green light by the government to build 22 biomass power plants, including 15 with a combined installed capacity of 350,000 kilowatts that are under construction. An interactive map of the locations of those planned power plants can be found here.

Established last October with a registered capital of one billion yuan (€96/US$128 million), the National Bio Energy Co., Ltd. is mainly engaged in the development of what it calls 'bioelectricity'. Insiders say the Shanxian plant plays a pilot role in developing China's bioelectricity.

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