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    Biodiesel producer D1 Oils, known for its vast jatropha plantations in Africa and Asia, is to invest CNY 500 to 700 million (€48.9-68.4 / US$65.5-91.7) to build a refinery in Guangxi Zhuang autonomous region, in what is expected to be the first biodiesel plant in the country using jatropha oil as a feedstock. South China Morning Post - June 18, 2007.

    After Brazil announced a record sugar crop for this year, with a decline in both ethanol and sugar prices as a result, India too is now preparing for a bumper harvest, a senior economist with the International Sugar Organization said. Raw sugar prices could fall further towards 8 cents per lb in coming months, after their 30% drop so far this year. Converting the global surplus, estimated to be 4 million tonnes, into ethanol may offer a way out of the downward trend. Economic Times India - June 18, 2007.

    After Brazil announced a record sugar crop for this year, with a decline in both ethanol and sugar prices as a result, India too is now preparing for a bumper harvest, a senior economist with the International Sugar Organization said. Raw sugar prices could fall further towards 8 cents per lb in coming months, after their 30% drop so far this year. Converting the global surplus, estimated to be 4 million tonnes, into ethanol may offer a way out of the downward trend. Economic Times India - June 18, 2007.

    A report from the US Department of Agriculture Foreign Agricultural Services (USDA FAS) estimates that the production of ethanol in China will reach 1.45 million tonnes (484 million gallons US) in 2007, up 12% from 1.3 million tonnes in 2006. Plans are to increase ethanol feedstocks from non-arable lands making the use of tuber crops such as cassava and sweet sorghum. USDA-FAS - June 17, 2007.

    The Iowa State University's Extension Bioeconomy Task Force carried out a round of discussions on the bioeconomy with citizens of the state. Results indicate most people see a bright future for the new economy, others are cautious and take on a distanced, more objective view. The potential for jobs and economic development were the most important opportunities identified by the panels. Iowa is the leading producer of corn based ethanol in the US. Iowa State University - June 16, 2007.

    Biofuel producer D1 Oils Plc, known for establishing large jatropha plantations on (degraded land) in Africa and Asia, said it was in advanced talks with an unnamed party regarding a strategic collaboration, sending its shares up 7 percent, after press reports linking it with BP. Firms like BP and other large petroleum companies are keen to secure a supply of biofuel to meet UK government regulations that 5 percent of automotive fuel must be made up of biofuels by 2010. Reuters UK - June 15, 2007.

    Jean Ziegler, a U.N. special rapporteur on the right to food, told a news briefing held on the sidelines of the U.N. Human Rights Council that "there is a great danger for the right to food by the development of biofuels". His comments contradict a report published earlier by a consortium of UN agencies, which said biofuels could boost the food security of the poor. Reuters - June 15, 2007.

    The county of Chicheng in China's Hebei Province recently signed a cooperative contract with the Australian investment and advisory firm Babcock & Brown to invest RMB480 million (€47.2/US$62.9 million) in a biomass power project, state media reported today. Interfax China - June 14, 2007.

    A new two-stroke ICE engine developed by NEVIS Engine Company Ltd. may nearly double fuel efficiency and lower emissions. Moreover, the engine's versatile design means it can be configured to be fuelled not only by gasoline but also by diesel, hydrogen and biofuels. PRWeb - June 14, 2007.

    Houston-based Gulf Ethanol Corp., announced it will develop sorghum as an alternative feedstock for the production of cellulosic ethanol. Scientists have developed drought tolerant, high-yield varieties of the crop that would grow well in the drier parts of the U.S. and reduce reliance on corn. Business Wire - June 14, 2007.

    Bulgaria's Rompetrol Rafinare is to start delivering Euro 4 grade diesel fuel with a 2% biodiesel content to its domestic market starting June 25, 2007. The same company recently started to distributing Super Ethanol E85 from its own brand and Dyneff brand filling stations in France. It is building a 2500 ton/month, €13.5/US$18 million biodiesel facility at its Petromidia refinery. BBJ - June 13, 2007.

    San Diego Gas & Electric (SDG&E), a utility serving 3.4 million customers, announced it has signed a supply contract with Envirepel Energy, Inc. for renewable biomass energy that will be online by October 2007. Bioenergy is part of a 300MW fraction of SDG&E's portfolio of renewable resources. San Diego Gas & Electric - June 13, 2007.

    Cycleenergy, an Austrian bioenergy group, closed €6.7 million in equity financing for expansion of its biomass and biogas power plant activities in Central and Eastern Europe. The company is currently completing construction of a 5.5 MW (nominal) woodchip fired biomass facility in northern Austria and has a total of over 150 MW of biomass and biogas combined heat and power (CHP) projects across Central Europe in the pipeline. Cycleenergy Biopower [*.pdf] - June 12, 2007.

    The government of Taiwan unveils its plan to promote green energy, with all government vehicles in Taipei switching to E3 ethanol gasoline by September and biofuel expected to be available at all gas stations nationwide by 2011. Taipei Times - June 12, 2007.

    A large-scale biogas production project is on scheme in Vienna. 17,000 tonnes of organic municipal waste will be converted into biogas that will save up to 3000 tonnes of CO2. 1.7 million cubic meters of biogas will be generated that will be converted into 11.200 MWh of electricity per year in a CHP plant, the heat of which will be used by 600 Viennese households. The €13 million project will come online later this year. Wien Magazine [*German] - June 11, 2007.

    The annual biodiesel market in Bulgaria may grow to 400 000 tons in two to three years, a report by the Oxford Business Group says. The figure would represent a 300-per cent increase compared to 2006 when 140 000 tons of biodiesel were produced in Bulgaria. This also means that biofuel usage in Bulgaria will account for 5.75 per cent of all fuel consumption by 2010, as required by the European Commission. A total of 25 biofuel producing plants operate in Bulgaria at present. Sofia Echo - June 11, 2007.

    The Jordan Biogas Company in Ruseifa is currently conducting negotiations with the government of Finland to sell CER's under the UN's Clean Development Mechanism obtained from biogas generated at the Ruseifa landfill. Mena FN - June 11, 2007.

    Major European bank BNP Paribas will launch an investment company called Agrinvest this month to tap into the increased global demand for biofuels and rising consumption in Asia and emerging Europe. CityWire - June 8, 2007.

    Malaysian particleboard maker HeveaBoard Bhd expects to save some 12 million ringgit (€2.6/US$3.4 million) a year on fuel as its second plant is set to utilise biomass energy instead of fossil fuel. This would help improve operating margins, group managing director Tenson Yoong Tein Seng said. HeveaBoard, which commissioned the second plant last October, expects capacity utilisation to reach 70% by end of this year. The Star - June 8, 2007.

    Japan's Itochu Corp will team up with Brazilian state-run oil firm Petroleo Brasileiro SA to produce sugar cane-based bioethanol for biofuels, with plans to start exporting the biofuel to Japan around 2010. Itochu and Petrobras will grow sugarcane as well as build five to seven refineries in the northeastern state of Pernambuco. The two aim to produce 270 million liters (71.3 million gallons) of bioethanol a year, and target sales of around 130 billion yen (€800million / US$1billion) from exports of the products to Japan. Forbes - June 8, 2007.

    Italian refining group Saras is building one of Spain's largest flexible biodiesel plants. The 200,000 ton per year factory in Cartagena can handle a variety of vegetable oils. The plant is due to start up in 2008 and will rely on European as well as imported feedstocks such as palm oil. Reuters - June 7, 2007.

    The University of New Hampshire's Biodiesel Group is to test a fully automated process to convert waste vegetable oil into biodiesel. It has partnered with MPB Bioenergy, whose small-scale processor will be used in the trials. UNH Biodiesel Group - June 7, 2007.

    According to the Barbados Agricultural Management Company (BAMC), the Caribbean island state has a large enough potential to meet both its domestic ethanol needs (E10) and to export to international markets. BAMC is working with state actors to develop an entirely green biofuel production process based on bagasse and biomass. The Barbados Advocate - June 6, 2007.

    Energea, BioDiesel International and the Christof Group - three biodiesel producers from Austria - are negotiating with a number of Indonesian agribusiness companies to cooperate on biodiesel production, Austrian Commercial Counselor Raymund Gradt says. The three Austrian companies are leading technology solution providers for biodiesel production and currently produce a total of 440,000 tons of biodiesel per annum in Austria, more than half of their country’s annual demand of around 700,000-800,000 tons. In order to meet EU targets, they want to produce biodiesel abroad, where feedstocks and production is more competitive. BBJ - June 6, 2007.

    China will develop 200 million mu (13.3 million hectares) of forests by 2020 in order to supply the raw materials necessary for producing 6 million tons of biodiesel and biomass per year, state media reported today. InterFax China - June 6, 2007.

    British Petroleum is planning a biofuel production project in Indonesia. The plan is at an early stage, but will involve the establishment of an ethanol or biodiesel plant based on sugarcane or jatropha. The company is currently in talks with state-owned plantation and trading firm Rajawali Nusantara Indonesia (RNI) as its potential local partner for the project. Antara - June 6, 2007.

    A pilot project to produce biodiesel from used domestic vegetable oil is underway at the Canary Technological Institute in Gran Canaria. Marta Rodrigo, the woman heading up the team, said the project is part of the EU-wide Eramac scheme to encourage energy saving and the use of renewable energy. Tenerife News - June 6, 2007.

    Royal Dutch Shell Plc is expanding its fuel distribution infrastructure in Thailand by buying local petrol stations. The company will continue to provide premium petrol until market demand for gasohol (an petrol-ethanol mixture) climbs to 70-90%, which will prove customers are willing to switch to the biofuel. "What we focus on now is proving that our biofuel production technology is very friendly to engines", a company spokesman said. Bangkok Post - June 5, 2007.

    Abraaj, a Dubai-based firm, has bought the company Egyptian Fertilizers in order to benefit from rising demand for crops used to make biofuels. The Abraaj acquisition of all the shares of Egyptian Fertilizers values the company based in Suez at US$1.41 billion. Egyptian Fertilizers produces about 1.25 million tons a year of urea, a nitrogen-rich crystal used to enrich soils. The company plans to expand its production capacity by as much as 20 percent in the next two years on the expected global growth in biofuel production. International Herald Tribune - June 4, 2007.

    China and the US will soon sign a biofuel cooperation agreement involving second-generation fuels, a senior government official said. Ma Kai, director of the National Development and Reform Commission, said at a media briefing that vice premier Wu Yi discussed the pact with US Secretary of Energy Samuel Bodman and other US officials during the strategic economic dialogue last month. Forbes - June 4, 2007.

    German biogas company Schmack Biogas AG reports a 372% increase in revenue for the first quarter of the year, demonstrating its fast growth. Part of it is derived from takeovers. Solarserver [*German] - June 3, 2007.

    Anglo-Dutch oil giant Royal Dutch Shell PLC has suspended the export of 150,000 barrels per day of crude oil because of community unrest in southern Nigeria, a company spokesman said. Villagers from K-Dere in the restive Ogoniland had stormed the facility that feeds the Bonny export terminal, disrupting supply of crude. It was the second seizure in two weeks. Shell reported on May 15 that protesters occupied the same facility, causing a daily output loss of 170,000 barrels. Rigzone - June 2, 2007.

    Heathrow Airport has won approval to plan for the construction of a new 'green terminal', the buildings of which will be powered, heated and cooled by biomass. The new terminal, Heathrow East, should be completed in time for the 2012 London Olympics. The new buildings form part of operator BAA's £6.2bn 10-year investment programme to upgrade Heathrow. Transport Briefing - June 1, 2007.

    A new algae-biofuel company called LiveFuels Inc. secures US$10 million in series A financing. LiveFuels is a privately-backed company working towards the goal of creating commercially competitive biocrude oil from algae by 2010. PRNewswire - June 1, 2007.

    Covanta Holding Corp., a developer and operator of large-scale renewable energy projects, has agreed to purchase two biomass energy facilities and a biomass energy fuel management business from The AES Corp. According to the companies, the facilities are located in California's Central Valley and will add 75 MW to Covanta's portfolio of renewable energy plants. Alternative Energy Retailer - May 31, 2007.

    Two members of Iowa’s congressional delegation are proposing a study designed to increase the availability of ethanol across the country. Rep. Leonard Boswell, D-Ia., held a news conference Tuesday to announce that he has introduced a bill in the U.S. House, asking for a US$2 million study of the feasibility of transporting ethanol by pipeline. Sen. Tom Harkin, D-Ia., has introduced a similar bill in the Senate. Des Moines Register - May 30, 2007.

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Monday, June 18, 2007

Report: Arctic spring comes weeks earlier than a decade ago

The harsh winters of the High Arctic are giving way to spring weeks earlier than they did just a decade ago, researchers have reported in the cover story of the June 19th issue of Current Biology. The finding in the Arctic, where the effects of global warming are expected to be most severe, offers an early warning of things to come on the rest of the planet, according to the researchers.

Despite uncertainties in the magnitude of expected global warming over the next century, one consistent feature of extant and projected changes is that Arctic environments are and will be exposed to the greatest warming. Dr. Toke T. Høye of the National Environmental Research Institute, University of Aarhus, Denmark, observed the early arrival of spring at a study site in Zackenberg, northeast Greenland (see map, click to enlarge). The study confirms what many people already think, that the seasons are changing and that it is not just one or two warm years but a strong trend seen over a decade.
We were particularly surprised to see that the trends were so strong when considering that the entire summer is very short in the High Arctic - with just three to four months from snowmelt to freeze up at our Zackenberg study site in northeast Greenland. - Dr. Toke T. Høye, National Environmental Research Institute, University of Aarhus.
To uncover the effects of warming, the researchers turned to phenology, the study of the timing of familiar signs of spring seen in plants, butterflies, birds, and other species. Shifts in phenology are considered one of the clearest and most rapid signals of biological response to rising temperatures, Høye explained:

:: :: :: :: :: :: :: :: ::

Yet most long-term records of phenological events have come from much milder climes. For example, recent comprehensive studies have reported advancements of 2.5 days per decade for European plants and 5.1 days per decade across animals and plants globally.

Using the most comprehensive data set available for the region, the researchers now document extremely rapid climate-induced advancement of flowering, emergence, and egg-laying in a wide array of High Arctic species. Indeed, they show that the flowering dates in six plant species, median emergence dates of twelve arthropod species, and clutch initiation dates in three species of birds have advanced, in some cases by over 30 days during the last decade. The average advancement across all time series was 14.5 days per decade.

They also found considerable variation in the response to climate change even within species, he added, with much stronger shifts in plants and animals living in areas where the snow melts later in the year. That variation could lead to particular problems by disrupting the complex web of species interactions, Høye said.

Toke T. Høye's research team included Eric Post of Pennsylvania State University in University Park, PA; Hans Meltofte of the University of Aarhus in Roskilde (NERI), Denmark; Niels M. Schmidt and Mads C. Forchhammer of the University of Aarhus in Roskilde (NERI), Denmark and the Centre for Integrated Population Ecology.

The researchers were supported by the the Danish Environmental Protection Agency for their monitoring programmes at Zackenberg Research Station, and by the Danish Agency for Science, Technology and Innovation.

Image: Spring at the Zackenberg Research Station, northeast Greenland.

More information:
Høye et al., "Rapid advancement of spring in the High Arctic", Current Biology 17, R449-451, June 19, 2007 [reference to article not yet online at the time of writing].

Article continues

U.S. push for biofuels causes oil industry to scale back refinery expansion

A few days ago, OPEC threatened consumers and governments that green fuels will push prices for oil products even higher, because the global rise of biofuels may make OPEC countries decide to slow down their oil production expansion. The announcement was seen as scare-mongering by many and condemned by the chief of the International Energy Organisation, who said biofuels do not have that large an impact as OPEC thinks. He urged OPEC countries, who have been making gigantic profits, to do their duty and to invest in increased production (earlier post).

Now, a similar tone is being used by the oil industry in the US, equally enjoying windfall profits. Oil executives warn that America's very ambitious proposed legislation on biofuels - currently being debated in Congress - might make oil refiners decide to scale back their expansion plans. This could keep gasoline and diesel prices high for years to come.

The irony of these statements is that communities and governments have been investing in biofuels precisely because oil prices and refined products have been at record highs. Oil companies have been making monster profits, and should be using this money to invest in expanding production and refining capacity. But they don't, and now they blame biofuels instead. Oil companies already have scaled expansion plans back by nearly 40 percent. They threaten with more cancelations if Congress passes the legislation now before the Senate.
All the talk about biofuels threatening gasoline production is the latest attempt to blame ethanol on Big Oil's failure to meet our energy needs. The ethanol industry continues to grow while oil refiners continue to make excuses for maintaining their profitable status quo. - Ron Lamberty of the American Coalition for Ethanol
The U.S. Senate is currently debating the major new Energy Bill, which contains proposals for huge increases in ethanol production. The latest (of over 100) amendments include a call for an expansion of the renewable fuels standard (RFS) to 44 billion gallons by 2022, with 30 billion of that coming from advanced biofuels. The current language in the bill proposes a 36 billion gallon RFS by 2022, with 21 billion of that coming from renewable fuels. A three-part list of these ongoing discussions and amendments can be found here (part1, part 2 and part 3).

Given this radical effort to promote biofuels in the U.S., oil companies see growing uncertainty about future gasoline demand and little need to expand refineries or build new ones. Oil industry executives no longer believe there will be the demand for gasoline over the next decade to warrant the billions of dollars in refinery expansions - as much as 10 percent increase in new refining capacity - they anticipated as recently as a year ago:
:: :: :: :: :: :: :: :: :: :: :: ::

This shortage of refineries frequently has been blamed by politicians for the sharp price spikes in gasoline, as was the case last week by Republican Sen. James Inhofe during the debate on the senate Energy Bill: "The fact is that Americans are paying more at the pump because we do not have the domestic capacity to refine the fuels consumers demand", Inhofe complained as he tried unsuccessfully to get into the bill a proposal to ease permitting and environmental rules for refineries.

This spring, refiners, hampered by outages, could not keep up with demand and imports were down because of greater fuel demand in Europe and elsewhere. Despite stable - even sometimes declining - oil prices, gasoline prices soared to record levels and remain well above $3 a gallon.

Consumer advocates maintain the oil industry likes it that way: "By creating a situation of extremely tight supply, the oil companies gain control over price at the wholesale level," said Mark Cooper of the Consumer Federation of America. He argued that a wave of mergers in recent years created a refining industry that "has no interest in creating spare (refining) capacity."

Only last year, the Energy Department was told that refiners, reaping big profits and anticipating growing demand, were looking at boosting their refining capacity by more than 1.6 million barrels a day, a roughly 10 percent increase. That would be enough to produce an additional 37 million gallons of gasoline daily. But now the expansion has come to a halt, and the oil industry says it may cancel even more expansion plans if Congress approves the Energy Bill's ambitious targets for biofuels.

"These (expansion) decisions are being revisited in boardrooms across the refining sector," said Charlie Drevna, executive vice president of the National Petrochemical and Refiners Association.
With the anticipated growth in biofuels, "your getting down to needing little or no additional gasoline production" above what is being made today, said Joanne Shore, an analyst for the government's Energy Information Administration. In 2006, motorists used 143 billion gallons (541 billion liters) of gasoline, of which 136 billion was produced by U.S. refineries, and the rest imported.

Drevna, the industry lobbyist, said annual demand had been expected to grow to about 161 billion gallons (609 billion liters) by 2017. But Bush's call to cut gasoline demand by 20 percent - through a combination of fuel efficiency improvements and ethanol - would reduce that demand below what U.S. refineries make today, he said.

"We will end up exporting gasoline," said Drevna. Asked recently whether Chevron Corp. might build a new refinery, vice chairman Peter Robertson replied, "Why would I invest in a refinery when you're trying to make 20 percent of the gasoline supply ethanol".

Valero Corp., the largest U.S. refiner producing 3.3 million barrels a day of petroleum product, recently boosted production capacity at its Port Arthur, Texas, refinery by 325,000 barrels a day. But company spokesman Bill Day said some additional expansions have been postponed.
"That's not to say we've changed our plans," Day said in an interview. "But it's fair to say we're taking a closer look at what the president is saying and what Congress is saying" about biofuels. He said there's a "mixed message" coming out of Washington, calling for more production but also for reducing gasoline demand. "It's something that we have to study pretty carefully," said Day.

Democratic Sen. Byron Dorgan said consolidation of the oil industry into fewer companies has left them with no incentive to expand refineries. "It's a perverted system that does not act as a free market system would act," said Dorgan. "If you narrow the neck of refining, you actually provide a greater boost to prices which is a greater boost to profitability. Richard Blumenthal, the attorney general of Connecticut, wants Congress to require refiners to maintain a supply cushion in case of unexpected outages.

In the 1980s, Blumenthal said at a recent hearing, refiners were producing at 77.6 percent of their capacity, "which allowed for easy increases in production to address shortages. In the 1990s, as the industry closed refineries, ... (that figure) rose to 91.4 percent, leaving little room for expansion to cover supply shortfalls."

More information:
Forbes (AP): Gasoline Refinery Expansions Scaled Back - June 18, 2007.

GreenCarCongress: Update on the US Senate Energy Bill, part 1, part 2, part 3.

Reuters: U.S. law to spur new oil refineries a bust so far - June 15, 2007.

Article continues

Study: greenhouse gas balance of different energy cropping systems

In a recent open-access study published in Ecological Applications, Paul Adler from the USDA's Agricultural Research Service (ARS) and colleagues compare the net production of carbon dioxide and two other greenhouse gases (GHG) associated with producing biofuels via different pathways from several bioenergy crops. Since a GHG balance includes the emissions from energy used during farming, transporting and converting the biomass into biofuels, the study also offers an energy balance of the different biofuels.

The results of the life-cycle analysis show that of all bioenergy pathways studied, the gasification of hybrid poplar and switchgrass for the production of electricity reduced GHG emissions most. A conventional-till corn–soybean–alfalfa rotation the biomass of which is converted into ethanol had the smallest potential. If the biofuels replace gasoline and diesel, the resulting reduction of GHG emissions for corn rotations was 50–65%, for reed canarygrass 120%, and about 145% and 165% for switchgrass and hybrid poplar, respectively (figure 1, click to enlarge).

Interestingly, the author briefly analyses the GHG-reduction potential of using biomass in so-called carbon capture and storage systems (CCS). Such 'Bio-Energy with Caron Storage (BECS) systems offer carbon-negative energy and could take historic GHG emissions out of the atmosphere (earlier post and references there).

Grasses and trees

Ethanol and biodiesel from corn and soybean are currently the main biofuel crops in the United States, but the perennial crops alfalfa, hybrid poplar, reed canarygrass, and switchgrass have been proposed as future dedicated energy crops. Rotations of annual and perennial crops are common and the diversity of individual crops will affect greenhouse gas (GHG) fluxes of the cropping system. Corn–soybean and corn–soybean–alfalfa rotations are common cropping systems in Pennsylvania. Crop residues have also been proposed as a current source of biomass for energy production including corn stover (leaves and stalks of corn), although this practice is not without controversy (earlier post).

Adler and his team looked at the GHG balance of the conversion of biomass into two types of energy. For the perennial grasses and hybrid poplar into liquid biofuels such as (celluosic) ethanol and biodiesel, and into electricity via the gasification of biomass. For the rotation crops corn, soybean and alfalfa into ethanol or biodiesel. They used the DAYCENT model to simulate the net GHG fluxes of bioenergy cropping systems in Pennsylvania for inclusion in a full assessment of GHG emissions associated with energy production from crops.

Five bioenergy cropping systems were compared:
  1. switchgrass
  2. reed canarygrass
  3. corn–soybean rotation (2 years of corn followed by 1 year of soybeans),
  4. corn–soybean–alfalfa rotation (3 years corn, 1 year soybeans, followed by 4 years of alfalfa)
  5. hybrid poplar
Conventional and no tillage were compared within the corn–soybean and corn–soybean–alfalfa rotations. All simulations were for 30 years. Adler used two scenarios: a short term scenario based on the capacity of soils to naturally store soil organic carbon (SOC); and a long term scenario based on the observation that over the course of time, soils lose some of this capacity if farmed continuously.

Crop and biofuel yields
The results show that hybrid poplar and switchgrass had the highest harvested biomass yields. Corn scored lower because it is typically grown in rotation with soybean, which is much lower yielding.

Biofuel production is directly related to crop yield but not linearly because biomass composition affects conversion efficiency. Ethanol and biodiesel yields for the individual crops ranged from 1.8 to 7.5 MJ/m²/year; corn (grain plus 50% stover) had the highest biofuel yield, hybrid poplar and switchgrass were similar but about 10–15% lower than corn, reed canarygrass was around 40% lower, and alfalfa stems and soybean grain had about 75–85% lower biofuel yields (figure 2, click to enlarge):
:: :: :: :: :: :: :: :: :: :: :: ::

The pattern between crop and biofuel yield among cropping systems was similar, with hybrid poplar comparable to switchgrass, and corn–soybean rotation, reed canarygrass, corn–soybean–alfalfa rotation having progressively lower yields. The electricity yields from gasification of biomass for cropping systems were highest for hybrid poplar and switchgrass, and reed canarygrass was around 20% lower.

The quantity of gasoline and diesel displaced by the production of ethanol and biodiesel from cropping systems followed the same pattern as ethanol/biodiesel yields, but values were lower because although the energy content of biodiesel and diesel are similar, ethanol has about two thirds the energy content of gasoline. The quantity of coal displaced by the production of electricity from gasification of biomass from cropping systems ranged from 14.7 to 18.4 MJ/m²/year for the perennial crops.

Greenhouse-gas sinks
So which factor and cropping system avoided most greenhouse gases? Displaced fossil fuel (Cdff) was the largest greenhouse gas (GHG) sink; hybrid poplar and switchgrass displaced the most fossil fuel. Hybrid poplar stored the most carbon followed by switchgrass, reed canarygrass, corn–soybean rotation, and corn–soybean–alfalfa rotation. No-till corn–soybean and corn–soybean–alfalfa rotations had higher carbon sink than conventional tillage. The amount of CO2 equivalents (CO2e) emitted from fossil fuels used in feedstock transport to the biorefinery, conversion to biofuel, and subsequent distribution was negative for the perennial grasses and hybrid poplar and positive for the grain crops when both biomass and grain were converted to ethanol or biodiesel.

Methane uptake (CCH4) was the smallest GHG sink. Hybrid poplar had the highest CCH4 at −3.98 CO2e-Cg/m²/year, the other cropping systems increased in CH4 uptake from −1.41 to −1.57 in the order of switchgrass, conventional tillage corn–soybean and corn–soybean–alfalfa rotation, reed canarygrass, and no-till corn–soybean–alfalfa and corn–soybean rotation. High CH4 uptake by hybrid poplar compared to the other systems is consistent with data from various global sites showing that mean CH4 uptake rates by deciduous forests exceed those in grasslands, cropped soils, and non-deciduous forests by a factor of 2 or more. Feedstock conversion to biofuel was a net source of energy for hybrid poplar and the perennial grasses.

Greenhouse-gas sources
The CO2e–C of N2O emissions estimated by the biogeochemical model DAYCENT were the largest GHG source. The corn–soybean rotation had the highest emissions followed by reed canarygrass, corn–soybean–alfalfa rotation, switchgrass, and hybrid poplar. As expected, estimated N2O emissions were driven largely by N inputs from fertilizers and fixation. Corn rotations under conventional tillage had slightly higher direct CN2O (CN2O Dir) than under no-till.

The relationship of direct soil N2O emissions between cropping systems calculated with the IPCC (Intergovernmental Panel on Climate Change, 2000) protocol differed from those predicted by DAYCENT. The N2O emissions calculated from IPCC were highest for the corn–soybean–alfalfa rotation, followed by the corn–soybean rotation and reed canarygrass; N2O emissions from hybrid poplar and switchgrass were much less. The difference between IPCC (2000)-calculated N2O emissions and DAYCENT were less than 20% for hybrid poplar, corn–soybean rotation, and reed canarygrass. However, the IPCC (2000)-calculated N2O emissions for the rotations that featured N fixers were significantly higher than DAYCENT (almost 40% and more than 50% for the corn–soybean–alfalfa rotation under conventional and no-till, respectively).

IPCC (2000) estimates of N2O emissions from switchgrass are around 35% lower than DAYCENT. Indirect N2O emissions differed widely among crops (combined with direct N2O emissions in Fig. 2d). NO3 leaching, the major source of indirect emissions in this case, ranged from ∼0.5 g N/m²/year for switchgrass, to ∼1 g N/m²/year for hybrid poplar, to more than 2 g N/m²/year for reed canarygrass and the corn rotations.

Emissions from chemical inputs were low for hybrid poplar and switchgrass and somewhat higher for the other cropping systems. Emissions from chemical inputs were high for reed canarygrass and the corn–soybean rotation largely because N fertilizer inputs are high for these crops.

Energy used for farming
The energy required for farm operations varied widely, with CO2 emissions ranging from 128 kg CO2-C ha/year for corn to to less than 20 kg CO2-C·ha−1·yr−1 for established alfalfa and switchgrass. Differences are a result of the frequency of farm implement use, the load the equipment was under during operation, and the required crop-specific equipment. These data are similar to those collected by others, but the integrated farm system model (IFSM) allowed comparison of current energy use from agricultural machinery between all farm operations under standardized conditions. (The exception was for hybrid poplar; since IFSM does not include forestry operations, data from separate sources were used.)

Perennial cropping systems can have lower agricultural machinery inputs than annual systems. The exception to this trend is hybrid poplar because energy costs of harvesting are high. Propane was used to dry corn and usually accounted for about one third of the C emissions for the corn rotations. Tillage accounted for almost 30% of the C emissions in the corn rotations but less than 10% in the switchgrass and reed canarygrass and less than 2% in hybrid poplar, where tillage was only used the first year. Harvesting was responsible for the majority of emissions for the hybrid poplar and perennial grass systems and at least 30% for the corn rotations.

Energy used for feedstock conversion

Feedstock conversion to biofuel was a net consumer of energy for all the corn, soybean, and alfalfa rotations and was also a net consumer when the grasses and hybrid poplar were gasified for electricity generation.

Net greenhouse-gas flux

Hybrid poplar and switchgrass provided the largest net GHG sinks with both systems having net CO2 e-C fluxes of less than −200 g/m²/year for the near term scenario when biomass and grain are converted to ethanol and biodiesel. The sink for reed canarygrass was about −120 g/m²/year and the sink for the conventional-till corn–soybean–alfalfa rotation was the smallest at about −50 g·m−2·yr−1 for the near-term scenario. Trends among the different cropping systems for the long-term scenario were similar, but the sinks were smaller because C storage in soil and belowground biomass was considered negligible in the long term.

The sinks were even greater when biomass was converted to electricity by gasification at the power plant, and there was a similar relationship among cropping systems. On a unit-area basis of crop production, gasification of the grasses and hybrid poplar yielded more than twice the GHG reduction than did converting these crops to ethanol. Net GHG emissions were from about −8 to −9 g CO2e-C/MJ ethanol for corn rotations, but about −18 g CO2e-C/MJ for reed canarygrass and less than −24 g CO2e-C/MJ for switchgrass and hybrid poplar. This resulted in a reduction of GHG emissions for corn rotations in the near term of about 50–65%, reed canarygrass ∼120%, and about 145% and 165% for switchgrass and hybrid poplar, respectively, compared with the life cycle of gasoline and diesel.

In the long term, where soil C sequestration was assumed to no longer occur, this resulted in a reduction of GHG emissions for corn rotations of ∼40%, reed canarygrass ∼85%, and ∼115% for switchgrass and hybrid poplar compared with the life cycle of gasoline and diesel. The GHGnet reduction from gasifying biomass instead of coal was about −64 to −70 g CO2e-C/MJ, an 85–93% reduction in greenhouse gases compared with the coal life cycle.

The near-term scenario used by Adler (one in which soil organic carbon (SOC) levels stay at their natural level) combined all the GHG sinks and sources evaluated in this study, and considered how using biofuels would reduce GHGnet compared to continuing to use fossil fuels in the near-term.

The displaced fossil-fuel C (Cdff) was the dominant factor in determining GHGnet. In general, switchgrass and hybrid poplar had higher yields, greater soil C sequestration, reduced GHG emission from feedstock conversion, reduced soil N2O emissions, and reduced GHG emissions from chemical input manufacture and agricultural machinery operation.

The long-term GHGnet assumed that SOC was zero because soils were equilibrated and no longer sequestering additional C. This scenario considers how using biofuels would reduce GHGnet compared to continuing to use fossil fuels in the long term. All cropping systems were still GHG sinks compared to their fossil fuel counterparts. Biofuels have been considered to have a near-zero net emission of greenhouse gases. However, coproducts such as lignin and protein, along with soil C sequestration, can reduce GHGnet, making these system sinks, and when compared with the life-cycle GHG emissions of the displaced fossil fuel, Adler's analysis shows biofuels having net GHG benefits.

Producing energy from crops is a land extensive approach to energy production. In addition to having metrics that allow easy comparison across technologies (such as GHG emissions per megajoule of fuel), to evaluate land-use implications of bioenergy cropping systems, a metric expressed in terms of policy impact per unit land area is needed. In the study cellulosic crops had higher biofuel yield and lower GHG emissions per unit land area than corn rotations. Cellulosic crops also had a greater reduction in GHG emissions per unit biofuel produced than corn rotations, resulting in greater reductions in GHG emissions associated with energy use compared with fossil fuels.

Carbon capture
Capture of CO2 from fuel production and energy generation would further increase the impact of biofuels on reducing GHGnet. Only a portion of biomass C is retained in ethanol and biodiesel. In an ethanol conversion facility for corn stover, about one third of the biomass C is converted to ethanol, the remainder of biomass C was emitted as combustion exhaust and fermentation-generated CO2. Similar proportions of biomass C were converted to ethanol in this study. Two thirds of the C could be captured at a biorefinery and nearly 100% could be captured at a biomass-gasification power plant. Spath and Mann have quantified the impact of CO2 capture for both coal and biomass-gasification systems. They found that even with CO2 capture, fossil-based systems still have greater GHG emissions per kilowatt-hour of electricity than for biomass power-generation systems without C capture.

Carbon credit markets associated with GHG mitigation strategies have been developed. Short-term strategies for mitigating greenhouse gases using biofuels include soil C sequestration. However, displacement of greenhouse gases associated with the use of fossil fuels is the only long-term mitigation mechanism when using biofuels and would be easier to track for carbon markets.

In short, the use of biofuel could reduce the net GHG flux of energy use, whether from production of liquid fuels, such as ethanol and biodiesel, or generation of electricity from gasification of biomass. The choice of crop and management practices will affect the net GHG fluxes of energy use from biofuel. Cellulosic energy crops such as switchgrass and hybrid poplar have the greatest potential to reduce net emissions of energy use in the near- and long-term.

Figure 1: Comparison of the life-cycle greenhouse-gas (GHG) emissions associated with the quantity of gasoline and diesel displaced by ethanol and biodiesel produced from the cropping systems (displaced fossil-fuel C [Cdff]) with the quantity of GHG emissions associated with the life cycle of biofuel (ethanol and biodiesel) production (feedstock-conversion C [CFC] + CCH4 + direct CN2O + indirect CN2O + chemical-inputs C [CCI] + agricultural-machinery C [CAgMa]); near-term includes change in system C [ΔCsys]). The percentage reduction in GHG emissions was calculated as the difference in the biofuel emissions and fossil-fuel emissions displaced from biofuel produced by a given crop expressed as a percentage of the displaced fossil-fuel emissions.

Figure 2: Crop and fuel yield from bioenergy cropping systems. Yields are expressed either as crop component (a, b) or system (c, d) yields. Corn yields assumed that only 50% of the corn stover (leaves and stalks) was harvested; alfalfa yields only contained stems, 50% of the total yield. (a) Component yields are presented; the 2-yr corn and 1-yr soybean (c2b1) rotation and 3-yr corn, 1-yr soybean, and 4-yr alfalfa (c3b1a4) rotation yields are from the conventional-tillage system. (b) All crop components were converted to ethanol except soybean grain, which was converted to biodiesel. (c) System yields were combined from crop rotations and annualized over the rotation cycle. (d) Crop component fuel yields of ethanol and biodiesel were combined to give system yields.

More information:
Paul R. Adler, Stephen J. Del Grosso, and William J. Parton, "Life-cycle assessment of net greenhouse-gas flux for bioenergy cropping systems", Ecological Applications, Volume 17, Issue 3 (April 2007), pp. 675–691.

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China EnerSave retrofits coal plants to burn biomass

As we read the depressing stories about China building a new coal-fired power plant each week, a more optimistic trend is emerging that builds on old coal plants and turns them green. China EnerSave, a company that entered the power and energy sector in 2004, apparently has found the right investment strategy: making money with a large conventional coal plant, using the profits to attract funds to build medium-scale biomass power facilities and retrofitting many small coal plants that dot the country into facilities that burn local, carbon-neutral plant matter.

Writing for Singapore's Business Times, Teh Hooi Ling explores this cascading strategy and sees that it works well. China EnerSave currently operates a 270 MW coal-fired power plant called Henan Yima Jinjiang. It acquired a 51 per cent stake in Yima in mid-Sept 2006 for US$45 million. And in the last three months of 2006, that 51 per cent stake contributed $6.3 million or 76 per cent to the group's 2006 full-year operating profit. In essence, Yima helped increased China EnerSave's 2006 net earnings to $4.8 million, from $1.1 million the year before.

Just over a month ago, China EnerSave entered into another agreement to buy over the remaining 49 per cent of Yima for US$20 million. The deal will be completed by end-July. This means the group will get 100 per cent of Yima's revenue and earnings for four months this year.

China EnerSave is also a major partner in the 2004 joint development of a greenfield project to develop a waste-to-energy plant. The 12 MW plant in Huizhou, in which it has a 71 per cent stake, started operating late last year. It will make its maiden contributions in the current financial year.

But the group's biggest bet is in biomass energy projects. It is now building three 24 MW biomass power plant projects in China. The first two - in Chengdu County and LongChang County, in Sichuan province - are scheduled for completion in 2008, while the third, in Changyi County in Shangdong, should be ready in 2009. Tay Wee Kwang, China EnerSave's executive director, said the group has managed to negotiate with the exclusive right to run a biomass plant in each of the above counties.

EnerSave's biomass power plants typically have the following properties:
  • Operational life: 30 years
  • Feedstock: agricultural waste - bamboo, rice stalks and corn stalks, with an average heating value of 3600 kcal/kg
  • 2 x 300MT direct steam biomass-to-energy system
  • generating 24 megawatts of electricity
The company has signed more than 10 exclusive memorandums of understanding to develop such biomass plants with various provincial authorities in China and is carrying out feasibility studies.

To accelerate its entry into the power industry, China EnerSave is looking into opportunities to acquire small coal-fired power plants that are suitable for conversion into biomass power plants:
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According to Mr Tay, to build a new 24 MW biomass plant, investment of 250 million renminbi (S$50 million) and a time frame of 20 months are required. Retrofitting a coal-fired power plant into a biomass plant needs half of that investment and takes only a year.

The AIM is to have 20 biomass power plants in China by the end of 2010.

The Chinese government gives a 0.25 renminbi subsidy for every kwH of electricity generated by biomass plants. Assuming that remains, and that China EnerSave can obtain the feedstock for its plants at the prices it expects, each plant can generate net earnings of about US$3.6 million, according to analysts' estimates. This includes carbon credits of US$1.1 million a year.

As the investment will be 40 per cent funded by equity, the return on equity works out to a decent 28 per cent.

Dedicated biomass plants
Biomass power plants burn plant matter such as trees, grass, agricultural crops or waste, or other biological material in a boiler to produce high-pressure steam. This steam rotates a turbine and generates electricity. Next to hydropower, more electricity is generated from biomass than any other renewable energy resource in the United States now. And China is stepping up its efforts in the sector too.

Because of the low energy content of biomass compared to coal, biomass plants are slightly less efficient because feedstocks have to be stored and handled in more complex chains, just like the waste products, such as biomass fly ash of which greater quantities become available. But the lower efficiency is easily offset by the environmental advantages of green power. Biomass does not add carbon dioxide to the atmosphere because it absorbs the same amount of carbon in growing as it releases when consumed as fuel. Its low sulphur content means biomass combustion is much less acidifying than coal combustion, for example. Also, the ashes from biomass consumption are very low in heavy metals and can be recycled on soils, or used as a feedstock for a range of construction materials.

In China, a small subsidy is available for biomass generated electricity to make it competive with coal, still by far the cheapest feedstock in the country. A biomass plant must also ensure it has sufficient feedstock available nearby at an economical rate. An efficient collection and storage system must be in place.

Assuming the design and engineering of the plant is fine, a profitable biomass operation must also make sure the cost of getting its electricity on to the grid is not exorbitant. According to Mr Tay, China EnerSave has located its plants between 800 m and 8 km from the nearest connection points. Also, a biomass plant must have access to water.

In a 26-page report on China EnerSave released last month, research firm Standard & Poor's forecast that the group will make a net profit of $18.6 million this year, or almost four times its earnings last year. But this assumes a 51 per cent stake in the Yima coal power plant. And 2008 will be the year when the biomass projects start to chip in to the bottom line. S&P, whose report is paid a fee by China EnerSave, reckons the group could rake in $24.5 million.

At $18.6 million forecast earnings for 2007, China EnerSave is trading at about 10 times that. And for 2008, the multiple is 7.6 times.

However, to fund its aggressive expansion, China EnerSave has had to raise funds. Earlier this year it completed a $30 million convertible note issue to Value Capital Asset Management. All the Notes have since been converted to shares.

And currently, it is in the process of issuing a $50 million convertible bonds. Four months after the completion of the issue, the bonds can be converted at a 10 per cent discount to the then-traded price of the shares. So the lower the share price, the more shares the bond holders will get. However, there is a minimum conversion price.

S&P said that despite the large share issuance, China EnerSave's new projects should generate enough profits to more than make up for the dilution. 'Although its new business is not without risks, we believe the favourable medium- to long-term demand for energy in China should help mitigate some risks. While returns should converge to more normal levels of around 12 per cent internal rate of return for most power assets in China, this should be supported by stable utilisation rates and generally stable cash flow,' it said.

So on the whole, it appears that China EnerSave is worthy of closer attention, concludes Teh Hooi Ling. The Dubai Investment Group and Hong Kong-based Private Equity firm Energy Partners seem to think it's a worthwhile bet. Each owns about 11 per cent of the company. Meanwhile, one director, Tan Choon Wee, has been accumulating the shares in the open market.

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