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    The Colorado Wood Utilization and Marketing Program at Colorado State University received a $65,000 grant from the U.S. Forest Service to expand the use of woody biomass throughout Colorado. The purpose of the U.S. Department of Agriculture grant program is to provide financial assistance to state foresters to accelerate the adoption of woody biomass as an alternative energy source. Colorado State University - October 12, 2007.

    Indian company Naturol Bioenergy Limited announced that it will soon start production from its biodiesel facility at Kakinada, in the state of Andhra Pradesh. The facility has an annual production capacity of 100,000 tons of biodiesel and 10,000 tons of pharmaceutical grade glycerin. The primary feedstock is crude palm oil, but the facility was designed to accomodate a variety of vegetable oil feedstocks. Biofuel Review - October 11, 2007.

    Brazil's state energy company Petrobras says it will ship 9 million liters of ethanol to European clients next month in its first shipment via the northeastern port of Suape. Petrobras buys the biofuel from a pool of sugar cane processing plants in the state of Pernambuco, where the port is also located. Reuters - October 11, 2007.

    Dynamotive Energy Systems Corporation, a leader in biomass-to-biofuel technology, announces that it has completed a $10.5 million equity financing with Quercus Trust, an environmentally oriented fund, and several other private investors. Ardour Capital Inc. of New York served as financial advisor in the transaction. Business Wire - October 10, 2007.

    Cuban livestock farmers are buying distillers dried grains (DDG), the main byproduct of corn based ethanol, from biofuel producers in the U.S. During a trade mission of Iowan officials to Cuba, trade officials there said the communist state will double its purchases of the dried grains this year. DesMoines Register - October 9, 2007.

    Brasil Ecodiesel, the leading Brazilian biodiesel producer company, recorded an increase of 57.7% in sales in the third quarter of the current year, in comparison with the previous three months. Sales volume stood at 53,000 cubic metres from August until September, against 34,000 cubic metres of the biofuel between April and June. The company is also concluding negotiations to export between 1,000 to 2,000 tonnes of glycerine per month to the Asian market. ANBA - October 4, 2007.

    PolyOne Corporation, the US supplier of specialised polymer materials, has opened a new colour concentrates manufacturing plant in Kutno, Poland. Located in central Poland, the new plant will produce colour products in the first instance, although the company says the facility can be expanded to handle other products. In March, the Ohio-based firm launched a range of of liquid colourants for use in bioplastics in biodegradable applications. The concentrates are European food contact compliant and can be used in polylactic acid (PLA) or starch-based blends. Plastics & Rubber Weekly - October 2, 2007.

    A turbo-charged, spray-guided direct-injection engine running on pure ethanol (E100) can achieve very high specific output, and shows “significant potential for aggressive engine downsizing for a dedicated or dual-fuel solution”, according to engineers at Orbital Corporation. GreenCarCongress - October 2, 2007.

    UK-based NiTech Solutions receives £800,000 in private funding to commercialize a cost-saving industrial mixing system, dubbed the Continuous Oscillatory Baffled Reactor (COBR), which can lower costs by 50 per cent and reduce process time by as much as 90 per cent during the manufacture of a range of commodities including chemicals, drugs and biofuels. Scotsman - October 2, 2007.

    A group of Spanish investors is building a new bioethanol plant in the western region of Extremadura that should be producing fuel from maize in 2009. Alcoholes Biocarburantes de Extremadura (Albiex) has already started work on the site near Badajoz and expects to spend €42/$59 million on the plant in the next two years. It will produce 110 million litres a year of bioethanol and 87 million kg of grain byproduct that can be used for animal feed. Europapress - September 28, 2007.

    Portuguese fuel company Prio SA and UK based FCL Biofuels have joined forces to launch the Portuguese consumer biodiesel brand, PrioBio, in the UK. PrioBio is scheduled to be available in the UK from 1st November. By the end of this year (2007), says FCL Biofuel, the partnership’s two biodiesel refineries will have a total capacity of 200,000 tonnes which will is set to grow to 400,000 tonnes by the end of 2010. Biofuel Review - September 27, 2007.

    According to Tarja Halonen, the Finnish president, one third of the value of all of Finland's exports consists of environmentally friendly technologies. Finland has invested in climate and energy technologies, particularly in combined heat and power production from biomass, bioenergy and wind power, the president said at the UN secretary-general's high-level event on climate change. Newroom Finland - September 25, 2007.

    Spanish engineering and energy company Abengoa says it had suspended bioethanol production at the biggest of its three Spanish plants because it was unprofitable. It cited high grain prices and uncertainty about the national market for ethanol. Earlier this year, the plant, located in Salamanca, ceased production for similar reasons. To Biopact this is yet another indication that biofuel production in the EU/US does not make sense and must be relocated to the Global South, where the biofuel can be produced competitively and sustainably, without relying on food crops. Reuters - September 24, 2007.

    The Midlands Consortium, comprised of the universities of Birmingham, Loughborough and Nottingham, is chosen to host Britain's new Energy Technologies Institute, a £1 billion national organisation which will aim to develop cleaner energies. University of Nottingham - September 21, 2007.

    The EGGER group, one of the leading European manufacturers of chipboard, MDF and OSB boards has begun work on installing a 50MW biomass boiler for its production site in Rion. The new furnace will recycle 60,000 tonnes of offcuts to be used in the new combined heat and power (CHP) station as an ecological fuel. The facility will reduce consumption of natural gas by 75%. IHB Network - September 21, 2007.

    Analysts fear that record oil prices will fuel general inflation in Kenya, particularly hitting the poorest hard. They call for the development of new policies and strategies to cope with sustained high oil prices. Such policies include alternative fuels like biofuels, conservation measures, and more investments in oil and gas exploration. The poor in Kenya are hit hardest by the sharp increase, because they spend most of their budget on fuel and transport. Furthermore, in oil intensive economies like Kenya, high oil prices push up prices for food and most other basic goods. All Africa - September 20, 2007.

    Finland's Metso Power has won an order to supply Kalmar Energi Värme AB with a biomass-fired power boiler for the company’s new combined heat and power plant in Kalmar on the east coast of Sweden. Start-up for the plant is scheduled for the end of 2009. The value of the order is approximately EUR 55 million. The power boiler (90 MWth) will utilize bubbling fluidized bed technology and will burn biomass replacing old district heating boilers and reducing the consumption of oil. The delivery will also include a flue gas condensing system to increase plant's district heat production. Metso Corporation - September 19, 2007.

    Jo-Carroll Energy announced today its plan to build an 80 megawatt, biomass-fueled, renewable energy center in Illinois. The US$ 140 million plant will be fueled by various types of renewable biomass, such as clean waste wood, corn stover and switchgrass. Jo-Carroll Energy - September 18, 2007.

    Beihai Gofar Marine Biological Industry Co Ltd, in China's southern region of Guangxi, plans to build a 100,000 tonne-per-year fuel ethanol plant using cassava as feedstock. The Shanghai-listed company plans to raise about 560 million yuan ($74.5 million) in a share placement to finance the project and boost its cash flow. Reuters - September 18, 2007.

    The oil-dependent island state of Fiji has requested US company Avalor Capital, LLC, to invest in biodiesel and ethanol. The Fiji government has urged the company to move its $250million 'Fiji Biofuels Project' forward at the earliest possible date. Fiji Live - September 18, 2007.

    The Bowen Group, one of Ireland's biggest construction groups has announced a strategic move into the biomass energy sector. It is planning a €25 million investment over the next five years to fund up to 100 projects that will create electricity from biomass. Its ambition is to install up to 135 megawatts of biomass-fuelled heat from local forestry sources, which is equal to 50 million litres or about €25m worth of imported oil. Irish Examiner - September 16, 2007.

    According to Dr Niphon Poapongsakorn, dean of Economics at Thammasat University in Thailand, cassava-based ethanol is competitive when oil is above $40 per barrel. Thailand is the world's largest producer and exporter of cassava for industrial use. Bangkok Post - September 14, 2007.

    German biogas and biodiesel developer BKN BioKraftstoff Nord AG has generated gross proceeds totaling €5.5 million as part of its capital increase from authorized capital. Ad Hoc News - September 13, 2007.

    NewGen Technologies, Inc. announced that it and Titan Global Holdings, Inc. completed a definitive Biofuels Supply Agreement which will become effective upon Titan’s acquisition of Appalachian Oil Company. Given APPCO’s current distribution of over 225 million gallons of fuel products per year, the initial expected ethanol supply to APPCO should exceed 1 million gallons a month. Charlotte dBusinessNews - September 13, 2007.

    Oil prices reach record highs as the U.S. Energy Information Agency releases a report that showed crude oil inventories fell by more than seven million barrels last week. The rise comes despite a decision by the international oil cartel, OPEC, to raise its output quota by 500,000 barrels. Reuters - September 12, 2007.

    OPEC decided today to increase the volume of crude supplied to the market by Member Countries (excluding Angola and Iraq) by 500,000 b/d, effective 1 November 2007. The decision comes after oil reached near record-highs and after Saudi Aramco announced that last year's crude oil production declined by 1.7 percent, while exports declined by 3.1 percent. OPEC - September 11, 2007.

    GreenField Ethanol and Monsanto Canada launch the 'Gro-ethanol' program which invites Ontario's farmers to grow corn seed containing Monsanto traits, specifically for the ethanol market. The corn hybrids eligible for the program include Monsanto traits that produce higher yielding corn for ethanol production. MarketWire - September 11, 2007.

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Saturday, October 13, 2007

IWMI confirms small potential for first generation biofuels in China and India due to water issues

A very basic scenario analysis by Sri Lanka's International Water Management Institute (IWMI) indicates that first generation biofuels made from crops like corn or sugarcane will add to the strain on already stressed water resources in China and India. The IWMI recommends the use of water-efficient crops instead and urges analysts to take water needs of bioenergy production more stringently into account.

The findings are a bit outdated because the Chinese government earlier already decided that it would only utilize water efficient crops like sweet sorghum, grasses, desert pine and cellulosic biomass (previous post and here). These resources are not analysed in the report, prompting a critical reaction by a Chinese bioenergy official.

Global bioenergy potential by 2050, different scenarios. Note China and India's relatively small capacity. Source: IEA Bioenergy Task 40.
Still, IWMI's research confirms data from many earlier projections. The International Energy Agency's Bioenergy Task 40, which has been making the most thorough global assesments of the biofuels potential, found that both China and India's carrying capacity is small, compared to that of other regions. This doesn't come as a surprise given the countries' large populations and limited per capita land resources. In a latest set of projections (Smeets et al., February 2007), scientists of Task 40 found that East Asia's sustainable biofuels potential is between 22 and 194 Exajoules by 2050; that of South Asia only between 22 and 37 Ej (earlier post; map, click to enlarge). Compare this to Africa's (317Ej max) or Latin America's (221Ej max).

IWMI’s research under the 'Comprehensive Assessment of Water Mangement in Agriculture' model shows that at a global average, the biomass needed to produce one litre of biofuel from such crops like maize and sugarcane evaporates between 1000 and 3,500 liters of water, under prevailing first-generation conversion techniques (note that meanwhile, the era of fourth generation techniques drawing on engineered crops has arrived).

IWMI uses the WATERSIM model consisting of two integrated hydrological and economic modules to support its analysis. Using this model it found [*.pdf]that in India more than 60% of the cereals are irrigated. In China, more than 70%. Almost all Indian sugarcane - the crop that India uses to produce ethanol - and about 45% of Chinese maize – China’s main biofuel crop - is irrigated.

Both countries, responding to severe water shortages, initiated large projects to transfer water from water abundant to water short areas. These projects are controversial because of their costs, environmental impacts, and number of displaced people by big dams.

Irrigation plays a dominant role in China’s food production. An estimated 75% of total grain production, 90% of vegetables and 80% of cotton comes from irrigated areas:
:: :: :: :: :: :: :: :: :: :: ::

About 70% of total wheat and 60% of total maize are harvested in the Northern region (i.e. the Yellow, Huaihe and Haihe river basins), where more than 60% of the area is irrigated and groundwater resources are already extensively overexploited.

The South imports food from the water stressed Northern region and the international food market. Earlier the water rich South produced a surplus that was exported to the Northern provinces. But with economic development and associated higher opportunity costs for land and labor, agricultural production in the developed South is becoming less attractive to farmers who have more opportunities to work in non-agricultural sectors.

The total volume of water resources in China ranks sixth worldwide, but per capita supplies are only 2200 m3 in 2000, about 1/4 of the world average. Particularly, in the North -Haihe, Huaihe and Yellow river basins- per capita water resources are low, only 290 m3, 478 m3 and 633 m3, respectively and declining groundwater tables due to overdraft are common. Frequent droughts, floods and water logging hazards result in unstable agricultural production and a serious imbalance between water supply and demand). A major water transfer project from South to North currently under implementation will alleviate some of the water shortage problems, but most of the transferred water will be used in the domestic and industrial sector rather than agriculture.
Because of water limitations in the North and land constraints and high opportunity costs to labor in the South, our base scenario foresees limited scope for further improvements in production. The scenario puts a limit on land and water use to prevent further environmental degradation. Maize demand in China will increase substantially to 195 million tons in 2030 (up by 70% from 2000), mainly because of growth in per capita meat consumption as a result of income growth.
Part of the additional demand can be met through productivity growth and slight area increase, but even under optimistic yield growth assumptions imports must increase to 20 million tons from 2 million tons in 2004. Under such a scenario it is quite unlikely that the additional maize demand for biofuel can be met without further degrading water resources or major shifts of cropping pattern at the expense of other crops. More likely, under an aggressive biofuel program China will have to import more maize (or the crop displaced by maize), which will undermine one of its primary objectives, i.e. curbing import dependency.

Irrigation plays a major role in India’s food supply. At present some 63% of the cereal production originates from irrigated areas. Wheat and rice are mostly produced under irrigated conditions while maize and other grains are grown in rainfed areas. Close to 85% of the area under sugarcane -the crop currently most used in bioethanol- is irrigated. It is estimated that the total harvested area amounts to 175 million hectares (in 2005) of which roughly 45% is irrigated. More than half of the irrigated area is under groundwater irrigation, mostly privately owned tubewells.

Total renewable water resources are estimated at 1887 km3, but only half (or 975 km3) is potentially utilizable. Total water resources amount to 2025 m3 per capita (for the year 2000), or only around 1100 m3 of potentially utilizable per capita supplies. Water withdrawals in India were estimated at 630 km3 in the year 2000, of which more than 90% was for irrigation. Spatial variation is enormous. The river basins of the Indus, Pennar, Luni and westerly flowing rivers in Kutsch and Gujarat are absolute water scarce, and much of North India suffers from groundwater overdraft.

To address water scarcity, the government of India is exploring the possible implementation of a series of large scale interbasin transfers to bring water from water abundant to water short areas. This so-called “Linking of Rivers” project is controversial, because it is expensive; it will have adverse impacts on biodiversity and freshwater ecosystems, and will cause the displacement of millions of people. Though parts are under development now, it is unlikely that this project will be fully implemented and operational in the near future. Our base scenario therefore foresees relatively limited scope for further irrigation development. The scenario adopts optimistic assumptions to improve productivity in both irrigated and rainfed agriculture.

Cereal and vegetable demand in India is projected to increase by 60% and 110% respectively from 2000 to 2030. The irrigated harvested area is expected to slightly increase from 75 to 84 million hectares. A major part of these increases will be met through improvements in yields though small increases of imports are inevitable. Sugarcane production increases from 300 to 605 million tons for food purposes. Our biofuels scenario implies that for the production of bioethanol an additional 100 million tons of sugarcane is needed, for which 30 km3 additional irrigation water needs to be withdrawn. This amount will likely come at the expense of the environment or other irrigated crops (cereals and vegetables), which then need to be imported. For many years, the Indian government has focused on achieving national food self-sufficiency in staples.

More recently, as the imminent danger of famines has decreased and non-agricultural sectors have expanded, the national perspective regarding production and trade has changed. But it is unclear if India would choose to import food to free up necessary resources to grow biofuel crops, the report says.

In its discussion of the findings the report concludes that:
If all national policies and plans on biofuels are successfully implemented, 30 million additional hectares of crop land will be needed along with 180 km3 of additional irrigation water withdrawals. Although globally this is less than a few percentage points of the total area and water use, the impacts for some individual countries could be highly significant, including China and India, with significant implications for water resources and with feedback into global grain markets. In fact it is unlikely that fast growing economies such as China and India will be able to meet future food, feed and biofuel demand without substantially aggravating already existing water scarcity problems, or importing grain, an outcome which counters some of the primary reasons for producing biofuels in the first place.
Unless other less water intensive alternatives are considered, biofuels based on such first generation techniques and crops are not environmentally sustainable in China and India.
This analysis assumes no major changes in feedstock. Yet, this may become an important factor in the biofuel discussion. From a water perspective it makes a large difference whether biofuel is derived from fully irrigated sugarcane grown in semi-arid areas or rainfed maize grown in water abundant regions. The use of water-extensive oilseeds (such as Jatropha trees), bushes, wood chips and crop residuals (i.e. straw, leaves and woody biomass) is promising in this respect, though a few caveats are necessary.
The IWMI concludes that biofuel policies should put green energy into a blue context and take water issues into account.

A US study on water withdrawals for corn published recently by the National Research Council similarly concluded that the significant acceleration of first-generation biofuels production could cause greater water quantity problems depending on where the crops are grown.

If the use of corn for ethanol production increases further it may harm water quality could be considerable, the report concluded (previous post).


Charlotte de Fraiture Mark Giordano Liao Yongsong, Biofuels and implications for agricultural water use: blue impacts of green energy [*.pdf], International Water Management Institute, Sri Lanka - October 2007.

Edward M.W. Smeets, André P.C. Faaij, Iris M. Lewandowski and Wim C. Turkenburg, "A bottom-up assessment and review of global bio-energy potentials to 2050", Progress in Energy and Combustion Science, Volume 33, Issue 1, February 2007, Pages 56-106, doi:10.1016/j.pecs.2006.08.001

Energy Current: China: Biofuel will not hit food, water supply - October 12, 2007.

Biopact: Report: increase in corn ethanol production could significantly impact water quality and availability in the United States - October 10, 2007

Biopact: A quick look at 'fourth generation' biofuels - October 08, 2007

Biopact: China unveils $265 billion renewable energy plan, aims for 15% renewables by 2020 - September 06, 2007

Biopact: China to boost forest-based bioenergy, helps win battle against desertification - July 17, 2007

Biopact: China mulls switch to non-food crops for ethanol - June 11, 2007


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