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    The Royal Society of Chemistry has announced it will launch a new journal in summer 2008, Energy & Environmental Science, which will distinctly address both energy and environmental issues. In recognition of the importance of research in this subject, and the need for knowledge transfer between scientists throughout the world, from launch the RSC will make issues of Energy & Environmental Science available free of charge to readers via its website, for the first 18 months of publication. This journal will highlight the important role that the chemical sciences have in solving the energy problems we are facing today. It will link all aspects of energy and the environment by publishing research relating to energy conversion and storage, alternative fuel technologies, and environmental science. AlphaGalileo - December 10, 2007.

    Dutch researcher Bas Bougie has developed a laser system to investigate soot development in diesel engines. Small soot particles are not retained by a soot filter but are, however, more harmful than larger soot particles. Therefore, soot development needs to be tackled at the source. Laser Induced Incandescence is a technique that reveals exactly where soot is generated and can be used by project partners to develop cleaner diesel engines. Terry Meyer, an Iowa State University assistant professor of mechanical engineering, is using similar laser technology to develop advanced sensors capable of screening the combustion behavior and soot characteristics specifically of biofuels. Eurekalert - December 7, 2007.

    Lithuania's first dedicated biofuel terminal has started operating in Klaipeda port. At the end of November 2007, the stevedoring company Vakaru krova (VK) started activities to manage transshipments. The infrastructure of the biodiesel complex allows for storage of up to 4000 cubic meters of products. During the first year, the terminal plans to transship about 70.000 tonnes of methyl ether, after that the capacities of the terminal would be increased. Investments to the project totaled €2.3 million. Agrimarket - December 5, 2007.

    New Holland supports the use of B100 biodiesel in all equipment with New Holland-manufactured diesel engines, including electronic injection engines with common rail technology. Overall, nearly 80 percent of the tractor and equipment manufacturer's New Holland-branded products with diesel engines are now available to operate on B100 biodiesel. Tractor and equipment maker John Deere meanwhile clarified its position for customers that want to use biodiesel blends up to B20. Grainnet - December 5, 2007.

    According to Wetlands International, an NGO, the Kyoto Protocol as it currently stands does not take into account possible emissions from palm oil grown on a particular type of land found in Indonesia and Malaysia, namely peatlands. Mongabay - December 5, 2007.

    Malaysia's oil & gas giant Petronas considers entering the biofuels sector. Zamri Jusoh, senior manager of Petronas' petroleum development management unit told reporters "of course our focus is on oil and gas, but I think as we move into the future we cannot ignore the importance of biofuels." AFP - December 5, 2007.

    In just four months, the use of biodiesel in the transport sector has substantially improved air quality in Metro Manila, data from the Philippines Department of Environment and Natural Resources (DENR) showed. A blend of one percent coco-biodiesel is mandated by the Biofuels Act of 2007 which took effect last May. By 2009, it would be increased to two percent. Philippine Star - December 4, 2007.

    Kazakhstan will next year adopt laws to regulate its fledgling biofuel industry and plans to construct at least two more plants in the next 18 months to produce environmentally friendly fuel from crops, industry officials said. According to Akylbek Kurishbayev, vice-minister for agriculture, he Central Asian country has the potential to produce 300,000 tons a year of biodiesel and export half. Kazakhstan could also produce up to 1 billion liters of bioethanol, he said. "The potential is huge. If we use this potential wisely, we can become one of the world's top five producers of biofuels," Beisen Donenov, executive director of the Kazakhstan Biofuels Association, said on the sidelines of a grains forum. Reuters - November 30, 2007.

    SRI Consulting released a report on chemicals from biomass. The analysis highlights six major contributing sources of green and renewable chemicals: increasing production of biofuels will yield increasing amounts of biofuels by-products; partial decomposition of certain biomass fractions can yield organic chemicals or feedstocks for the manufacture of various chemicals; forestry has been and will continue to be a source of pine chemicals; evolving fermentation technology and new substrates will also produce an increasing number of chemicals. Chemical Online - November 27, 2007.

    German industrial conglomerate MAN AG plans to expand into renewable energies such as biofuels and solar power. Chief Executive Hakan Samuelsson said services unit Ferrostaal would lead the expansion. Reuters - November 24, 2007.

    Analysts think Vancouver-based Ballard Power Systems, which pumped hundreds of millions and decades of research into developing hydrogen fuel cells for cars, is going to sell its automotive division. Experts describe the development as "the death of the hydrogen highway". The problems with H2 fuel cell cars are manifold: hydrogen is a mere energy carrier and its production requires a primary energy input; production is expensive, as would be storage and distribution; finally, scaling fuel cells and storage tanks down to fit in cars remains a huge challenge. Meanwhile, critics have said that the primary energy for hydrogen can better be used for electricity and electric vehicles. On a well-to-wheel basis, the cleanest and most efficient way to produce hydrogen is via biomass, so the news is a set-back for the biohydrogen community. But then again, biomass can be used more efficiently as electricity for battery cars. Canada.com - November 21, 2007.

    South Korea plans to invest 20 billion won (€14.8/$21.8 million) by 2010 on securing technologies to develop synthetic fuels from biomass, coal and natural gas, as well as biobutanol. 29 private companies, research institutes and universities will join this first stage of the "next-generation clean energy development project" led by South Korea's Ministry of Commerce, Industry and Energy. Korea Times - November 19, 2007.

    OPEC leaders began a summit today with Venezuelan President Hugo Chavez issuing a chilling warning that crude prices could double to US$200 from their already-record level if the United States attacked Iran or Venezuela. He urged assembled leaders from the OPEC, meeting for only the third time in the cartel's 47-year history, to club together for geopolitical reasons. But the cartel is split between an 'anti-US' block including Venezuela, Iran, and soon to return ex-member Ecuador, and a 'neutral' group comprising most Gulf States. France24 - November 17, 2007.

    The article "Biofuels: What a Biopact between North and South could achieve" published in the scientific journal Energy Policy (Volume 35, Issue 7, 1 July 2007, Pages 3550-3570) ranks number 1 in the 'Top 25 hottest articles'. The article was written by professor John A. Mathews, Macquarie University (Sydney, Autralia), and presents a case for a win-win bioenergy relationship between the industrialised and the developing world. Mathews holds the Chair of Strategic Management at the university, and is a leading expert in the analysis of the evolution and emergence of disruptive technologies and their global strategic management. ScienceDirect - November 16, 2007.

    Timber products company China Grand Forestry Resources Group announced that it would acquire Yunnan Shenyu New Energy, a biofuels research group, for €560/$822 million. Yunnan Shenyu New Energy has developed an entire industrial biofuel production chain, from a fully active energy crop seedling nursery to a biorefinery. Cleantech - November 16, 2007.

    Northern European countries launch the Nordic Bioenergy Project - "Opportunities and consequences of an expanding bio energy market in the Nordic countries" - with the aim to help coordinate bioenergy activities in the Nordic countries and improve the visibility of existing and future Nordic solutions in the complex field of bioenergy, energy security, competing uses of resources and land, regional development and environmental impacts. A wealth of data, analyses and cases will be presented on a new website - Nordic Energy - along with announcements of workshops during the duration of project. Nordic Energy - November 14, 2007.

    Global Partners has announced that it is planning to increase its refined products and biofuels storage capacity in Providence, Rhode Island by 474,000 barrels. The partnership has entered into agreements with New England Petroleum Terminal, at a deepwater marine terminal located at the Port of Providence. PRInside - November 14, 2007.

    The Intergovernmental Panel on Climate Change (IPCC) kicks off the meeting in Valencia, Spain, which will result in the production of the Synthesis Report on climate change. The report will summarize the core findings of the three volumes published earlier by the separate working groups. IPCC - November 12, 2007.

    Biopact's Laurens Rademakers is interviewed by Mongabay on the risks of large-scale bioenergy with carbon storage (BECS) proposals. Even though Biopact remains positive about BECS, because it offers one of the few safe systems to mitigate climate change in a drastic way, care must be take to avoid negative impacts on tropical forests. Mongabay - November 10, 2007.

    According to the latest annual ranking produced by The Scientist, Belgium is the world's best country for academic research, followed by the U.S. and Canada. Belgium's top position is especially relevant for plant, biology, biotechnology and bioenergy research, as these are amongst the science fields on which it scores best. The Scientist - November 8, 2007.

    Mascoma Corporation, a cellulosic ethanol company, today announced the acquisition of Celsys BioFuels, Inc. Celsys BioFuels was formed in 2006 to commercialize cellulosic ethanol production technology developed in the Laboratory of Renewable Resources Engineering at Purdue University. The Celsys technology is based on proprietary pretreatment processes for multiple biomass feedstocks, including corn fiber and distiller grains. The technology was developed by Dr. Michael Ladisch, an internationally known leader in the field of renewable fuels and cellulosic biofuels. He will be taking a two-year leave of absence from Purdue University to join Mascoma as the company’s Chief Technology Officer. Business Wire - November 7, 2007.

    Bemis Company, Inc. announced today that it will partner with Plantic Technologies Limited, an Australian company specializing in starch-based biopolymers, to develop and sell renewably resourced flexible films using patented Plantic technology. Bemis - November 7, 2007.

    Hungary's Kalocsa Hõerõmû Kft is to build a HUF 40 billion (€158.2 million) straw-fired biomass power plant with a maximum capacity of 49.9 megawatts near Kalocsa in southern Hungary. Portfolio Hungary - November 7, 2007.

    Canada's Gemini Corporation has received approval to proceed into the detailed engineering, fabrication and construction phases of a biogas cogeneration facility located in the Lethbridge, Alberta area, the first of its kind whereby biogas production is enhanced through the use of Thermal Hydrolysis technology, a high temperature, high pressure process for the safe destruction of SRM material from the beef industry. The technology enables a facility to redirect waste material, previously shipped to landfills, into a valuable feedstock for the generation of electricity and thermal energy. This eliminates the release of methane into the environment and the resultant solids are approved for use as a land amendment rather than re-entering the waste stream. In addition, it enhances the biogas production process by more than 25%. Market Wire - November 7, 2007.

    A new Agency to manage Britain's commitment to biofuels was established today by Transport Secretary Ruth Kelly. The Renewable Fuels Agency will be responsible for the day to day running of the Renewable Transport Fuels Obligation, coming into force in April next year. By 2010, the Obligation will mean that 5% of all the fuels sold in the UK should come from biofuels, which could save 2.6m to 3m tonnes of carbon dioxide a year. eGov Monitor - November 5, 2007.

    Prices for prompt loading South African coal cargoes reached a new record last week with a trade at $85.00 a tonne free-on-board (FOB) for a February cargo. Strong Indian demand and tight supply has pushed South African prices up to record levels from around $47.00 at the beginning of the year. European DES/CIF ARA coal prices have remained fairly stable over the past few days, having traded up to a record $130.00 a tonne DES ARA late last week. Fair value is probably just below $130.00 a tonne, traders said. At this price, some forms of biomass become directly competitive with coal. Reuters Africa - November 4, 2007.

    The government of India's Harayana state has decided to promote biomass power projects based on gasification in a move to help rural communities replace costly diesel and furnace oil. The news was announced during a meeting of the Haryana Renewable Energy Development Agency (HAREDA). Six pilot plants have demonstrated the efficiency and practicability of small-scale biomass gasification. Capital subsidies will now be made available to similar projects at the rate of Rs 2.5 lakh (€4400) per 100 KW for electrical applications and Rs 2 lakh (€3500) per 300 KW for thermal applications. New Kerala - November 1, 2007.

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Thursday, September 27, 2007

European Plant Science Organisation calls for more action to kickstart the bioeconomy

With the urgent need to reduce greenhouse gas emissions and to cut our reliance on increasingly costly and non-renewable oil, the need for action in plant sciences arises to obtain an economically viable and sustainable production of renewable biofuels, green chemicals and biomaterials. While other countries already attribute significant research money to this field (e.g. more than $800 million in recent projects on biofuels in the US, $3 billion for the bioeconomy in Brazil), Europe still lacks concerted action. The EU's renewable energy directive, calling for 20% biofuels and renewables by 2020, is ambitious, but research support is insufficient to achieve these goals. In response, the European Plant Science Organisation (EPSO), has released a set of recommendations on how Europe can meet this challenge and provide a basis for integrated approaches towards the future knowledge-driven bioeconomy. The call for action comes after the EPSO-coordinated ‘Plants for the Future’ Technology Platform outlined its strategic research agenda (earlier post). EPSO represents more than 140 academic institutions from 25 European countries with over 20,000 people in plant research.

In 'Sustainable Future for Bioenergy and Renewable Products' [*.pdf] Europe's plant scientists state they are willing to take a responsible role in the implementation of a sustainable future bioeconomy by developing the knowledge and skills required for obtaining increased quantities of biomass suitable for conversion to biofuels and to renewable resources, at economically competitive prices, and within an environmentally and economically sustainable agricultural system that is an essential part of a future bioeconomy.

Societal and economic relevance
Today’s economies are based on carbon resources of fossil origin, which provide societies with their major energy sources and raw materials for chemical production. However, several major challenges for mankind arise from this approach:
  • the use of these fossil-based resources as fuels, but also as non-degradable substances and composites, causes severe regional and global environmental problems, including CO2 emissions for which there is increasingly compelling scientific evidence that they are a major contributory factor in global warming and climate change;
  • the availability of fossil resources does not match the expected increase in consumption of energy and raw materials in the future;
  • the distribution of fossil carbon sources around the globe makes them an even less reliable source in the future.
These aspects make clear that the present high dependence on fossil fuels is not sustainable. Together with the economic fact that energy and raw material prices have drastically increased over the last decade, these factors necessitate the development and establishment of alternative concepts and products.

Bio-based strategies hold great promise for sustainable solutions and are presently being developed worldwide to contribute significantly to the future mix of energy sources. Plants provide the major source of organic substances on our planet. They include relatively under-utilised forms such as cellulose, hemicellulose, starch, lipids and lignin that have major potential for use as raw materials for energy and industrial feedstocks. Significant impact is expected from bioenergy with respect to mitigation of climate change, development of rural areas and employment options as well as the provision of alternative energy forms. This is especially true for fuels used in transportation.

However, in order to make bioenergy a sustainable alternative, a holistic approach is needed, which:
:: :: :: :: :: :: :: :: :: :: :: ::

  • improves biomass supply with respect to amount and quality
  • improves conversion of biomass into other energy forms
  • reduces or eliminates toxic waste products
  • develops zero-waste biorefinery concepts for efficient conversion of plant raw materials into diverse products
  • manages bioenergy production systems in a sustainable manner
  • has minimal impacts on the environment
Effective and multilateral networking between the different, hitherto separated, research communities will be crucial to make bioenergy and bioeconomy a sustainable success. This approach will form the basis for the network required for a knowledge-based bioeconomy (KBBE) and will also provide new opportunities to farmers, the forestry sector and other stakeholders.

Plant science: creating the knowledge base for the bioeconomy
As plants will provide the major resource in a KBBE, plant science will play a major role in developing the capacity and novel opportunities for a bio-economy in line with the environmental and economic settings in Europe. European plant science is very well positioned to contribute with its strong expertise to obtain increased quantities of biomass at adequate qualities for the various optional routes of conversion, at economically competitive prices and with acceptable impacts on the environment.
There are numerous fields of action in which knowledge from plant sciences on agriculture and forestry crops needs to be used to deliver to the overarching aim of a sustainable bioenergy economy:

Higher biomass production urgently needed
This includes activities that increase biomass potential through direct improvement of growth and biomass production. This can be realised by increased growth rates, prolonged vegetation periods, or improved architecture of crops. It can also be achieved by reducing the loss of biomass due to pathogens and pests, by improved stress tolerance to allow using marginal lands and to lower competition with food production. Since the amount of biomass has to be enlarged significantly, all possible options have to be addressed in parallel.

Improved bioconversion for bioenerggy and biomaterials
This requires strong interdisciplinary interactions with microbial, chemical, engineering and process sciences to develop new industrial processing methods. In plant science, activities include modifying cell wall structure and composition to increase the ease with which it can be decomposed into units that are either themselves useful as biofuel, or are good starting points for the production of chemicals. Enhancement other aspects of the organic and inorganic composition of biomass with respect to the conversion processes (e.g. removing compounds inhibiting decomposition or fermentation, reducing alkali for improved combustion behaviour, etc.) and residue handling should also be achieved. Improving composition of harvestable plant biomass will also be beneficial, for example to provide lignin more suitable for making lignin-based composites.

Improved resource use efficiency

This is the key to higher biomass yield at low environmental impact. Achieving this includes improving processes such as energy collection through enhanced photosynthesis efficiency and nutrient use efficiency. This will reduce the dependence of plant growth on the application of additional inputs such as fertilizers that require high amounts of energy for production and have a deleterious environmental impact. Also topics like nitrogen-fixing bioenergy crops, associations with beneficial soil microorganisms and improving phosphate use efficiency are of prime importance to address decreasing availability and anticipated rising costs of fertilisers. Furthermore, minimising the water consumption per unit of energy gained is critical because fresh water will be a key limiting factor for food and energy production in the future on marginal land and with changing climatic conditions. Utilisation of plant varieties that can remove harmful substances from water and soil (e.g. excess nitrogen in overfertilised land, excess salt in highly irrigated land) can even provide additional beneficial effects.

Increased genetic diversity of bioenergy plants
This is key to achieving new properties in bioenergy crops. A bioenergy roadmap needs to be established and will include (i) the use of traditional food crops for which all the scientific tools are available, (ii) the development of novel crops via genomics-driven domestication of hitherto not or not significantly used species, (iii) the development of specific energy crop rotation systems and (iv) the use of the different options originating from agriculture, forestry or even an biofactory (e.g. algae) approach. Actions include the development of specific energy crops having improved properties in comparison to the classical crops, probably via an initial round of genomics-supported breeding, followed by introducing novel features through smart breeding or genetic modifications. Throughout the introduction of novel species, their potential to displace native species and their potential impact on biodiversity needs to be considered. It will be crucial to address the alternatives of food and energy utilisation.

Plant research in tune with bioenergy and environmental sciences

Plant scientists in Europe are prepared to take this challenge in close coordination with researchers and engineers in related disciplines in order to develop a new, sustainable and economically viable bioenergy sector within the bioeconomy of the future. Integration of plant research programmes must be obtained with:
  • White biotechnology: in order to obtain new biocatalysis features to form useful energy sources (e.g. bioethanol, biogas, etc.)
  • Conversion technology, chemistry and chemical engineering: significant interaction is required to obtain useful breeding targets on quality and quantity of biomass supplied to the alternative conversion routes.
  • Agricultural and forestry management, ecosystem and biogeochemical research: as the production of large scale biomass for bioenergy will be done in new production systems, new plant features must be integrated in them and they must be checked for their biogeochemical impacts.
  • Agricultural and forestry management and economics: it will be important to consider the potential to utilise non-food components of existing crop plants (e.g. straw, stover) for bioenergy as an added-gain that does not jeopardise food/feed production, and to consider how new dedicated energy crops are best integrated into agricultural practice and rotations in a manner that aids rather than competes with food and feed production.
  • Sustainability assessment: for an ecologically, socially and economically viable bioenergy sector, impact analysis on all the above stated aspects must be integrated and evaluated in macro and microeconomic contexts. It is important to provide society with scientifically validated information about options using transgenic and/or clonal plants and on the conversion of marginal land, grass or agricultural land and forests into efficient production units for various energy feedstocks. A thorough discussion of the balance between food-feed-energy outputs from agriculture must be based on sound scientific evidence.
Taking significant steps forward
This concept for a sustainable bio-economy is in agreement with the strategic research agenda (SRA) of the European Technology Platform ‘Plants for the Future’ published in June 2007. EPSO member institutions are committed to contribute to the implementation of the SRA, but significant steps are required in a coordinated manner between stakeholders from the public and private sector to transfer this plan into action:
  • significant investments into research and implementation similar to those presently done in leading countries outside Europe at national and European levels;
  • co-ordination with industry as well as governmental agencies and NGOs;
  • co-ordination and development of a common research agenda between all platforms committed to the idea of a sustainable knowledge-based bio-economy along the entire value chain.
EPSO published a position paper entitled ‘Sustainable future for bioenergy and renewable products’ and opened an internal discussion on it, asking its members to comment and send their feedback. After compilation and integration of the replies, the position paper was presented by Uli Schurr to the participants of the Venice Conference 'The Future of Science - The Energy Challenge' on 21 September 2007.

By publishing this present paper, EPSO wants to take an active role in the current debate about bioenergy and the potential ways to address this societal challenge. It presents insights on how research activities can contribute to tackling issues such as: How plant science can contribute to achieving the 10% goal for biofuels by 2020? What can plants do and not do? How can EPSO contribute?

The text was developed by an expert group comprising Mike Bevan (John Innes Centre Norwich, UK), Wilhelm Gruissem (ETH Zürich, CH), Hermann Hoefte (INRA, FR), Dirk Inze (VIB Gent, BE), Karin Metzlaff (EPSO, BE), Ulrich Schurr (Institute Phytosphere Jülich, DE – chair of the group), Mark Stitt (MPI Molecular Plant Physiology Golm, DE) and Björn Sundberg (Umeå Plant Science Centre, SE).

EPSO: EPSO position paper 'Sustainable Future for Bioenergy and Renewable Products' - September 27, 2007.

EPSO: Sustainable Future for Bioenergy and Renewable Products [*.pdf] - September 2007.

Biopact: 'Plants for the Future' technology platform presents plan for European bioeconomy - July 02, 2007

Article continues

India: 'outrageous' oil price damages economy, as $80pb could be new floor price

High oil prices have negative impacts on a range of social and economic activities, especially in the developing world. The least developed countries are energy intensive and consequently spend much more on oil as a percentage of GDP than highly developed countries. According to the African Union, Sub-Saharan African countries poured between 10 and 15% of their GDP into oil imports in 2006, whereas OECD countries spent only 1.5-3%. In oil importing poor countries, each price increase can be felt immediately throughout the economy on both the macro- and micro-economic front, with poor classes suffering most (earlier post).

Palaniappan Chidambaram, Finance Minister of India, which is heavily dependent on oil imports, illustrated some of the effects today by calling the current price for crude oil 'outrageous' and damaging the economy's growth.
The price of crude oil is an enormous external risk. Since these outrageous prices cannot be fully passed through to the consumers in India, the burden falls largely on the domestic budget and constrains our capacity for investment. - Indian Finance Minister Palaniappan Chidambaram
India imports nearly three-fourth of its crude oil requirement and spent more than $57 billion in 2006-07 for the purpose - almost equal to the country's entire trade deficit. Government has not allowed state-run oil marketing firms to raise fuel prices in line with cost and India's three main oil companies are projected to suffer a revenue loss of about 13 billion dollars this year.

Chidambaram also warned the depreciation of the dollar vis-a-vis the rupee has thrown up an unexpected downside risk. The Indian currency has strengthened more than 11 per cent in 2007, hurting exporters.

Forecasts: record price guaranteed
Meanwhile, the oil industry says the price is justified because the money is needed to invest in new exploration and refining capacity (earlier post). Recently, Iranian government spokesman Gholamhossein Elham even went so far as to state:
We, the oil exporting countries, believe the oil price is low and is not the real value of this important material of the world’s energy [mix].
Reuters published a poll on Wednesday asking petroleum (establishment) analysts to predict the average price for US crude oil in 2008. The result: $67 per barrel. However, Goldman Sachs, the most bullish in the poll, predicted WTI crude to average $85 next year with prices climbing as high as $95 by the end of 2008.

Peak Oil analysts are being taken more and more seriously, because they have been more accurate in their predictions. So what do they say? The Association for Peak Oil & Gas (ASPO) concluded at its latest annual conference that the new floor price of crude oil is $80 per barrel. The projection was shared by Ray Leonard, Vice-President of Kuwait Energy Company, James Buckee, CEO Talisman Energy, Jeff Rubin, chief economist of the Canadian Imperial Bank of Commerce and James Schlesinger, former U.S. energy secretary. Today, the ASPO's 1 year forecast stands at $107 pb.

Obviously, a price bracket of $67 to $80 makes biofuels a must for developing countries. Many first-generation fuels can be made at costs well below these prices, and we see a continued push into 'tropical' and 'subtropical' biofuels next year dominated by ethanol made from sugarcane (average production cost in Brazil: $37 per barrel of oil equivalent), sweet sorghum and cassava (projected production cost in Thailand: $38pboe), and by biodiesel made from palm oil (projected cost in Malaysia: $55pboe), jatropha and soy oil. But at $80-100, some second-generation biofuels too become competitive with crude. Amongst these, fast-pyrolysis based fuels and synthetic biofuels based on the Fischer-Tropsch process would be commercially viable (earlier post). Cellulosic ethanol based on enzymatic hydrolysis would require higher prices still. With the current state of technology, algae-based biofuels would need an oil price bracket of $120-150 to be competitive.

Catastrophy for poor countries
In energy intensive countries, the macro-economic effects of high oil can include higher inflation (including increased food prices), less economic growth, higher unemployment, and a weakened capacity to ease the debt burden:
:: :: :: :: :: :: :: :: ::

Such countries do not have the technical and financial instruments to deal with oil shocks, such as reserves and finetuned monetary policies. Most importantly, governments are often forced to cut spending on social services, with the UN finding that some of the poorest countries are already spending twice as much on importing oil than on such basics as health care. Of course, the poor suffer under all these factors most.

On the micro-economic front the consequences depend on government policies. In countries where fuels are not subsidized, the effects for the poor can be truly catastrophic: higher costs for food, for heating and cooking, and less mobility. Energy can take up to 30% of the household budget of families in the least developed countries. Farmers have a reduced capacity to bring their produce to market - a major problem in the Global South, where the majority of people live in rural areas and is employed in agriculture.

When petroleum fuels are subsidised, as is the case in India, the costs are transferred to the government, which then has a reduced capacity to invest in state and social services (education, health, security, etc...). Ultimately, the costs arrive at the population at large.

A more extensive overview of the effects of high oil prices on the least developed countries can be found here.


The Economic Times: FM warns against crude oil prices hurting GDP growth - September 27, 2007.

Reuters: Oil prices seen surging to record level next year - September 26, 2007.

Peakoil Netherlands: Iran: oil at $80 per barrel is cheap - September 24, 2007.

Biopact: High oil prices disastrous for developing countries - September 12, 2007

Biopact: Report: synthetic biofuels (BtL) and bioenergy efficient, competitive and sustainable in Germany - September 22, 2007

Article continues

Fortis Bank buys €13.1 million worth of carbon credits from biogas project in Brazil, at first internet auction

Belgian-Dutch Fortis Bank has bought carbon credits equivalent to 808,405 tonnes of CO2 which were offered in an auction by the São Paulo Municipal Government on the Brazilian Mercantile & Futures Exchange (BM&F). This was the world’s first Certified Emission Reductions (CERs) spot market auction managed and promoted by a regulated exchange, representing an important initial step in the organization and development of a global market for environmental certificates. The auction was carried out via the Internet.

Fortis Bank paid a total €13.1 million(US$18.5 million), which comes down to 16.20 €/tonne. The minimum price was 12.70 €/tonne and according to BM&F nine companies participated in the auction. (The carbon price in Europe currently stands at 21.23 €/tonne).

The carbon credits or CERs were approved by the UNFCCC's Clean Development Mechanism (CDM), a Kyoto Protocol instrument that allows wealthy and industrialised countries to buy carbon credits from or invest in clean energy projects in the developing world, as an alternative to more expensive emission reductions in their own countries.

The credits were issued by the Bandeirantes sanitary landfill, where methane gases are collected by private company Biogás Energia Ambiental and used to generate electric energy. The fact that the project involves carbon credits, alternative energy production and social development - the money is going to be invested in community projects - helped increase the final price, the city's adjunct municipal secretary Stela Goldenstein said.
The result is positive and now we have close to 34 million reais to invest in the neighborhood [in which the landfill is located]. This is apart from the 2008 budget for environmental projects. - São Paulo mayor Gilberto Kassab
The carbon credits from the Bandeirantes operation are evenly divided by Biogás and the municipality. The auction was only for the municipal government's share. Biogás has already sold its credits directly to German bank KFW, said Biogás official Manoel Antonio Avelino da Silva:
:: :: :: :: :: :: :: :: :: ::

Brazil is one of the leading generators of CERs in the world, after China and India. Many CDM projects involve direct participation of companies from the industrialised world but often intermediaries - banks and specialised carbon credit constultants - close the deals. The auction at the Brazilian Mercantile & Futures Exchange however was the first direct internet-based deal.

The BM&F Settlement Bank provided oversight and provides the cash settlement services.


Reuters Brasil: Fortis leva lote total de créditos de carbono em leilão na BM&F - September 26, 2007.

O Globo Online: Fortis leva lote total de créditos de carbono em leilão na BM&F - September 27, 2007.

Brazilian Mercantile & Futures Exchange: Carbon Credits: BM&F will hold an auction on September 26th - September 21, 2007.

Article continues

ConocoPhillips and Archer Daniels Midland team up to develop fuels from bio-oil

ConocoPhillips and Archer Daniels Midland Company today announced that they have agreed to collaborate on the development of renewable transportation fuels from biomass.

The alliance will research and seek to commercialize two components of a next-generation biofuel production process: the conversion of biomass from crops, wood or switchgrass into 'biocrude' (pyrolysis oil, bio-oil) that can be processed into fuel; and the refining of biocrude to produce transportation fuel.

Next-generation biofuels are obtained from two main conversion processes: a biochemical pathway that utilizes dedicated enzymes to break down lignocellulose into secrete fuels and gases (ethanol, biobutanol, biogas, biohydrogen); and a thermochemical pathway that transforms biomass either into a gas (gasification) or into a heavy oil, both of which need further processing into useable liquid and gaseous (transportation) fuels.

Within the thermochemical conversion segment, fast-pyrolysis is a process that rapidly heats (450-600 degrees celsius) biomass in the absence of air. The end product is bio-oil, also known as pyrolysis oil or biocrude. Fast-pyrolysis can yield around 70% of bio-oil from a given biomass feedstock (properties, click to enlarge). The pyrolysis liquid can then be further refined into a range of transportation fuels and green chemicals in dedicated biorefineries or in existing petroleum refineries. Biocrude can also readily be used as an alternative for heating oil and in oil-fired power plants.

A by-product is pyrolysis coke (char), which can be gasified or used directly as fertilizers and as feedstock for green chemistry. Alternatively, this bio-based char can be sequestered into agricultural soils, which results in improved yields (earlier post on the potential for carbon-negative biofuels by sequestring pyrolysis char or other forms of biochar.)

Because bio-oil has a high density (1110-1250kg/m3) with a high heating value (HHV) of around 16-19GJ/ton, its energy density is much higher than raw biomass. This allows for a decentralised logic in which pyrolysis plants are brought to the biomass source, instead of hauling the bulky feedstock to a central facility (earlier post)

Bio-oil production can also be combined with gasification. The idea is to pyrolyse biomass close to where it can be found, and then to ship the bio-oil and char to a central gasification plant, where the syngas is transformed into liquid biofuels ('synthetic biofuels') via the Fischer-Tropsch process. Recently, a German report showed that such a strategy would result in biofuels that are competitive with current petroleum fuels (earlier post):
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ConocoPhillips earlier showed its interest converting biomass to fuel through fast pyrolysis by investing $22.5 million into a biofuels research program at Iowa State University, which aimes to develop next-generation fuels from biomass.
ConocoPhillips believes that the development of next-generation biofuels is a critical step in the diversification of our nation’s energy sources. We are hopeful that this collaboration will provide innovative technology toward the large-scale production of biofuels that can be moved efficiently and affordably through existing infrastructure. - Jim Mulva, chairman and chief executive officer
Patricia Woertz, chairman and chief executive officer, ADM, added, "as we advance our global bioenergy interests, this alliance with ConocoPhillips represents an important next step. Innovative collaboration like this will identify and bring to market feasible, economic and sustainable next-generation biofuels."

ConocoPhillips and ADM have an example to draw some experience from: Dynamotive, an existing fast-pyrolysis company, has made serious process in demonstrating the technology and is actively building the first commercial-scale plants.

Image: a sample of bio-oil. Credit: Biomass Technology Group.

Biopact: Report: synthetic biofuels (BtL) and bioenergy efficient, competitive and sustainable in Germany - September 22, 2007

Biopact: Dynamotive demonstrates fast-pyrolysis plant in the presence of biofuel experts - September 18, 2007

Biopact: Dynamotive and Mitsubishi Corporation sign cooperation agreement - August 02, 2007

Biopact: Dynamotive plans to build 6 bio-oil plants in Argentina - April 30, 2007

Biopact: Dynamotive begins construction of modular fast-pyrolysis plant in Ontario - December 19, 2006

Biopact: Biomass-to-liquids: bring the factory to the forest, not the forest to the factory - September 18, 2006

Biopact: Carbon negative biofuels: Dynamotive to test biochar to boost crop yields, water quality, and sequester carbon - May 30, 2007

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Ceres raises $75 million to develop dedicated energy crops

Energy crop and biotech company Ceres, Inc. announced today that it has raised $75 million through a private offering of convertible preferred stock. The late-stage financing round was led by Warburg Pincus, a global private equity firm with a track record of investing in energy, alternative energy and renewables.

A seed and traits developer, Ceres plans to use the proceeds for research and product development activities in several dedicated energy crops, which are bred to maximize yields of plant biomass — the energy-rich source of next-generation biofuels based on biochemical and thermochemical conversion processes. The cellulosic biofuels industry shows promise of significant growth and is likely to become a material part of the transportation fuel market in the next decade.

Ceres has developed genomics-based tools and biotech traits for corn and other row crops which can be fully leveraged in dedicated energy crops. Within its energy crop business segment, Ceres’ development efforts cover switchgrass, sorghum, miscanthus, energycane (sugarcane optimized for biomass instead of sugar) and woody species like poplar. One of its first seed products, a high-yielding switchgrass cultivar, is currently scheduled for commercial launch in 2009.

Ceres traits under development include (schematic, click to enlarge): stress tolerance; yield density; nutrient uptake; composition; structure; and enzyme production. These traits can improve the economics of biofuel production as well as the environmental benefits of energy crops, including drought tolerance and nitrogen-use efficiency:
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We believe that Ceres is well-positioned to succeed as a leading supplier to energy crop growers and cellulosic biorefineries. The company has a strong track record in research and development and an intellectual property position that has been validated by industry-leading licensing agreements - Chansoo Joung, Warburg Pincus Managing Director
Richard Hamilton, Ceres President and CEO, says the company now has the resources needed to expand the scale of commercialization efforts, and the independence to broadly collaborate with downstream players in the transportation fuel industry.

The company also plans to continue the discovery and licensing of its traits to other businesses outside of energy crops.

Founded as a plant genomics company, Ceres holds one of the world’s largest proprietary collections of fully sequenced plant genes.

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UK's D1Oils continues to expand jatropha plantations globally

In its interim report [*.pdf] for 2007, D1 Oils, the only truly global biofuel company, shows it keeps expanding its Jatropha curcas plantations in India, South East Asia and Africa. For the first time, it is entering South America, while it is exploring Australia's agro-ecological potential for the crop. However, the Jatropha oil is not yet on the market, so D1Oils is temporarily utilizing other feedstocks for its 42,000 tonne biodiesel plant in Teesside. High prices for these feedstocks combined with competition from subsidised US biodiesel exports have more than doubled D1Oils' first-half pre-tax loss. Both problems are described as 'short term' challenges because the much less costly Jatropha oil is set to flow soon and the EU is taking action against the US's 'illegal' export subsidies (the socalled B99 loophole, more here). Jatropha remains a wild crop, but an ongoing plant improvement and molecular breeding programme promises to result in the emergence of high-yielding cultivars.

In June, D1Oils created a joint-venture with BP, D1-BP Fuel Crops Limited, to create a global Jatropha business (earlier post). The establishment of D1-BP Fuel Crops was a significant endorsement of the new feedstock strategy, which relies on the comparative advantages of developing countries that will grow the crop and the rural communities where planting will be based. The new joint venture, with an oil major choosing to produce biofuel feedstocks in the developing world, also represents a turning point for biodiesel globally.

Planting programme
Up to 15 September 2007, D1 has planted or obtained rights to offtake from a total of 198,690 hectares of jatropha worldwide. This represents an increase of over 53,000 hectares on the total of 145,625 at 16 March 2007 and an increase of 23,609 hectares on the total of 175,081 hectares at 30 June 2007. The cumulative position at 15 September 2007 is summarised in the table below (click to enlarge):

The table indicates the broad geographic locations and types of arrangements associated with jatropha planting worldwide in which D1 has an interest. The level of investment costs and security of future oil supply are proportional to the degree of direct involvement by D1 and its joint venture partners.

Managed plantations are those farms where land and labour is held by D1, either through its subsidiaries or joint venture partners. Under contract farming, the farmer plants his own trees on his own land. D1 and its partners assist with the provision of seedlings and the arrangement of bank finance for planting, and offer a buyback of harvested grains with an offtake agreement, subject to a floor price and the achievement of agreed quality standards.

D1 Oils provides support and advice during cultivation, and monitors the condition of the crops. Seed and oil supply agreements are arms-length supply contracts with third parties whereby D1, either directly or through joint venture partners, has offtake arrangements in place over future output from jatropha plantations which the third party is developing. D1 has limited involvement in this planting and relies on third parties to measure and manage the crop effectively.

During the period D1Oils continued to develop planting partnerships and expand planting footprint across all three operating regions. A joint venture relationship in North East India with Williamson Magor, one of India’s leading tea companies, has been particularly successful. Ongoing planting of jatropha is now approaching 50,000 hectares:
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Two Memoranda of Understanding (MOU) were recently signed in Indonesia. The first, with PT Astra Agro Lestari, part of the Jardine Matheson Group and the largest publicly traded agribusiness in Indonesia, concerns the creation of a 500 hectare Jatropha curcas pilot plantation, planting of which is planned to start in Q4 2007. Once the pilot is successful, the relationship will then turn to commercial planting. The second, a tripartite MOU between D1 Oils Asia Pacific, PT Medco Energi International, a publicly listed integrated energy company, and PT Mambruk Sarana Interbuana, a pioneer of solar energy in Indonesia, is for a 500 hectare pilot plantation in West Java. Planting operations here will commence in Q4 2007 with the intention to expand to 10,000 hectares.

In a key development for planting operations in South Africa, D1 is working together with the South African Government to establish the first commercial level jatropha pilot project in that country. The initial plantation size will be 5,000 hectares of which 1,000 hectares is expected to be planted in the first year. Planting will be carried out by D1 in co-operation with the Central Energy Fund, the Department of Agriculture and a commercial farming concern made up of both black and white farmers.

The project is intended to determine economic feasibility and will be used as a model for commercial jatropha planting in South Africa.

In addition to continuing planting in Africa, India and South East Asia, D1-BP Fuel Crops will expand planting to new, emerging markets, in particular South America. To this end D1 has signed a strategic partnership agreement with a Brazilian group, Curcas Diesel Brazil, to develop jatropha plantation projects throughout that country.

In the medium term, D1Oils believs that Australia has potential as a production location for jatropha and we are in active dialogue with the relevant Federal and State authorities regarding permission to import seeds and begin the first controlled trials for commercial planting of Jatropha curcas.

Plant improvement
D1Oils continued to collect individual accessions of Jatropha curcas from around the globe, and we began putting the most promising varieties from an already significant collection through the first ever commercial breeding and product placement trials.

These trials will identify optimal adaptation to different cultivation conditions. continued the development of our breeding programme to create the first cultivars
for future selection of high-yielding varieties. D1Oiuls also added two further Regional Development Centres (RDCs) in Swaziland and Thailand respectively.

Multiplication of the first generation, selected seed material, referred to as ‘E1’, was begun in all three operating regions. This seed material has been selected for higher yield and good biodiesel profile.

During the period, the company also introduced its Sustainable Oil Supply Programme (SOSP), in co-operation with our joint venture partners and farmers. This stewardship programme will record the performance of planting, enable the development of accurate oil production forecasts and will also monitor the implementation of policies for social, economic and environmental sustainability.

As a result of the formation of its joint venture with BP, D1’s plant science programme has been established as a separate company, wholly owned by D1 Oils plc. The activities of this new company will comprise research and development, plant science, breeding, and production and multiplication of seed and seedlings. It will act as the exclusive supplier to D1-BP Fuel Crops, the planting joint venture, on a cost-plus basis, of selected, high-yielding jatropha seeds and seedlings. It will also provide technical agronomy support and expertise to support and implement the SOSP programme. D1-BP Fuel Crops will pay D1 an annual royalty fee for the high yield performance by the plants it supplies.

Plant science operations to support the joint venture are on track. D1Oils anticipates that a proportion of the first of the selected E1 seedlings will be available before the end of this year. It is the intention to plant 50,000 hectares with E1 seedlings in 2008. The company expects to plant out the first 5-10% of this total ahead of schedule in 2007.

Furthermore, D12Oils is expanding research and testing infrastructure in anticipation of the growth in business from the joint venture. New Development Centres are being established in Cape Verde (as a central facility), as well as Indonesia and other countries where D1-BP Fuel Crops will operate, enabling D1 to support fully the joint venture’s planting activities.

A significant development is the recent signing of an exclusive worldwide service agreement with Keygene NV of the Netherlands. Keygene is one of the global leaders in the science of genetic fingerprinting, in particular molecular markers and marker-assisted breeding approaches. The agreement provides D1 with exclusive rights to contract research and molecular services carried out by Keygene on jatropha. Keygene’s genetic fingerprinting technology enables the identification of different jatropha cultivars through genetic markers similar to commercial bar codes. The technology has the potential to increase significantly the effectiveness of D1’s breeding programme for jatropha.

In addition to focusing on jatropha, D1Oils keeps to investigating other inedible oil crops.

Trading and biodiesel production
D1Oils' activities in refining and trading have been impacted by the ongoing challenges of high feedstock prices exacerbated by subsidised biodiesel imports from the United States. Refining margins across the industry have come under increasing pressure, and already in February 2007 D1Oils announced its intention to run refineries below capacity and to manage stocks of vegetable oil previously purchased at lower prices.

There has been no improvement in the overall level of feedstock prices (in fact they have continued to increase), and, having processed existing stocks, D1Oils is no longer refining virgin oil. However, the company is taking advantage of the flexibility and precision of its modular D1 20 refinery units to refine parcels of “off-spec” material purchased from other suppliers.

During the period the biofuel company increased the capacity of its Teesside site with the addition of a fifth D1 20 refinery unit. This is the first upgraded D1 20 units and has an enhanced capacity of 10,000 tonnes per year. Final commissioning is now underway, increasing the production capacity of the Teesside site to 42,000 tonnes.

Having completed the acquisition of a site in Bromborough, D1Oils began the conversion of the existing facilities, which formerly produced fuel and lubricant additives, to create 100,000 tonnes of initial biodiesel refining capacity. Given market conditions, the company has slowed the timetable for commissioning the first 50,000 tonnes of this capacity, which will be completed shortly.

D1 Oils is studying the potential impacts of the UK's Renewable Transport Fuels Obligation (RTFO) on the UK market after April 2008. It expects the RTFO to have a positive impact on trading conditions for UK biodiesel refining, but believes this benefit is likely to be counterbalanced by both higher feedstock prices and the continuation of subsidised soya methyl ester imports from the USA, which are entering the EU market in the form of a 99% soya biodiesel and 1% mineral diesel blend; so-called B99.

US producers are currently eligible for subsidies of US$1 for every gallon (approximately 11 pence per litre) of biodiesel blended with mineral diesel, which then receives further subsidy in EU markets. As a result, this material is setting market prices in the EU and refinery margins are substantially eroded.

The European biodiesel industry is working to get the EU authorities in taking the necessary measures to end the eligibility of US imports for double taxation relief. Unless the B99 taxation “double dip” issue is addressed, it will be difficult for the EU to develop a robust biodiesel refinery industry and for UK refiners to supply motorists and road transport businesses under the RTFO.

Until commercial volumes of low-cost jatropha oil become available for UK refining, D1Oils is purchasing and selling modest quantities of B99 to enable us to meet its obligations to clients and to develop our supply chain. It will continue to do so until the issue of asymmetric subsidies is resolved or feedstock prices reduce.

D1Oils: D1 Oils plc Interim report 2007 [*.pdf] - September 2007.

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Petrobras starts approving joint ventures worth $1 billion to set up 20 new ethanol plants

Brazil's state-run oil company, Petrobras will start approving five joint venture projects worth US$1 billion to produce ethanol from the Goias and Mato Grosso states this week, with the aim of getting 20 ethanol projects going by 2012. The initial funds will cover the acquisition of sugar cane plantations and co-generation facilities that will be fueled by bagasse, the fibrous biomass residue from crushed canes.

Petrobras has entered into a joint venture with Japan's Mitsui to establish 20 ethanol distilleries around the country with an annual capacity of 200 million litres each, by 2010 (earlier post). The Brazilian company will hold up to a 30 percent share in the projects.

Petrobras Downstream Director Paulo Roberto Costa told reporters the company is likely to approve five more biofuel joint ventures by the end of 2007 and another 10 more in 2008.

Earlier, Petrobras announced its strategic and business plans for the coming years (here), in which it aims to produce 4 billion liters of ethanol (equivalent to 50,000 barrels of oil per day) by 2012 for which it needs at least another 15 projects (besides the five already selected). Petrobras has been studying around 40 mill projects for exports mainly to the Japanese market since early 2007. The company is a key player in ethanol transport and distribution in the domestic market:
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The company is likely to fall short of its target for ethanol export sales this year due to infrastructure problems in Nigeria and a setback in the Venezuelan markets, as Venezuela had elected to go with an oil-based rather than an ethanol-based additive. However, Costa said talks had resumed on biofuel exports to Venezuela during President Hugo Chavez's visit to Brazil last week.

Currently, Brazil is the only country to export biofuels on a large scale. It has been leading an effort to create a genuine international market and to boost South-South technology exchanges. Brazil has also been active in trying to promote its production model abroad, mainly in Central America and Africa, where it offers scientific, technological and policy assistance. The goal in Africa is to help the continent tap its vast sustainable bioenergy potential in order to help African countries alleviate poverty by investing the establishment of green fuel industries.

Bilateral and trilateral biofuel cooperation agreements with African countries include agreements with Senegal, Ghana, Nigeria, Angola and Mozambique, with others to follow soon (more here).

Petrobras for its part has signed a series of collaboration agreements on biofuels with other (oil) companies, including Norway's Statoil (here), with India's state-owned Bharat Petroleum (here) and with Portugal's Galp Energia (earlier post).

Energy current: Petrobras aims for 20 ethanol projects by 2012 - September 27, 2007.

Petrobras: bioenergy portal.

Biopact: Petrobras announces strategic plan for 2020, expands biofuels activities globally - August 16, 2007

Biopact: Petrobras to build $200 million ethanol plant in Niger Delta to help alleviate crisis - May 30, 2007

Biopact: Brazil in Africa: South-South cooperation on bioenergy speeding up - March 13, 2007

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New biofuels market study focuses on India

A strong economy, rising incomes, and a vibrant market have given a huge boost to the transport sector in India, which is the fastest growing energy-consuming sector in the country. According to a new biofuels market analysis by Frost & Sullivan, this sector’s energy demand is expected to grow by 6 to 8 percent per annum during the 11th five-year plan period (2007-2012). With more than 80 percent of passengers and 60 percent of freight being transported by road, it is obvious that the dependence of personal modes of transport, such cars and two-wheelers, has increased drastically.

The automotive vehicle population is growing by 12 to 15 percent per annum and this will, in turn, impact the transport sector’s energy demand. Diesel and gasoline (petrol) contribute to 98 percent of the energy consumed in the transport sector.

Against this background the new report titled Strategic Analysis of the Indian Biofuels Market provides an overview of the current and future markets for biodiesel and ethanol in India. It also provides feedstock analysis, market drivers, restraints, and future strategies for the industry.

Held back by the lack of large-scale availability of feedstock, the Indian biodiesel market trails its global counterparts by a long way. It is likely to take a while for biodiesel to be established as an effective biofuel, since Jatropha plantations in the country are still in the initial stages of development. Three to four years and many plantations later, the country may have the feedstock necessary for the large-scale production of Jatropha oil for use in biodiesel. The absence of a clear Government policy on Jatropha oil production has inhibited several biofuel manufacturers from entering this market. Hence, Indian manufacturers are considering importing palm oil to produce biodiesel:
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The better-developed Indian bioethanol market is also grappling with similar availability issues, as ethanol is primarily manufactured from molasses - a by-product of sugar. Since sugarcane production is cyclical, the availability and cost of production of bioethanol will vary depending on sugarcane crop yields. India’s ethanol-blending program could not be implemented during 2003-2004 due to a low sugarcane output and the second phase of this program was announced in September 2006 only after a recovery in sugarcane production.

Overall, the Government and industry have to show greater initiatives toward the Jatropha program to help biodiesel manufacturers save costs. Meanwhile, in the bioethanol sector, further research is necessary to aid in the development of alternate feedstock and improvement in production efficiency.

India’s crude oil and petroleum products supplies are largely import-dependant. With oil import expenditure increasing by more than six times in the last 25 years due to escalation in global demand and prices, biofuels are likely to be pressed into service. This alternate form of fuel will be critical in reducing the dependence on fossil fuels, achieving greater energy security, and reducing noxious emissions.

"The Government is currently implementing an ethanol-blending program, while it is also considering initiatives in the form of mandates for biodiesel," notes the analyst. "Due to these mandates, the rising population, and the growing energy demand from the transport sector, biofuels will be assured of a significant market in India", the report states.

Research & Markets: Greater Government Involvement Needed To Improve Feedstock Production In The Indian Biofuels Market - September 26, 2007.

Frost & Sullivan: Strategic Analysis of the Indian Biofuels Market - August 2007.

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Biogas plant in the Netherlands upgrades gas for use in transport, households

In September, the first installation in The Netherlands which retrieves biogas from the sewage treatment process for domestic and transport use officially entered [*.Dutch] service in the city of Beverwijk, after a year of trials.

The Hoogheemraadschap Hollands Noorderkwartier treats the sewage of around 1 million Dutch citizens in 20 plants. At its plant in Beverwijk some 1,5 million cubic meters of biogas gets released which, up til now, was used in two gas engines. The excess was flared. The old system needed replacement, and after a feasibility study it became apparent that an anaerobic fermentation system had several advantages: it is more efficient, requires less maintenance and reduces CO2 emissions.

The new system from BioGast Sustainable Energy upgrades biogas resulting from the fermentation of sewage sludge to biomethane which is then fed into the gas grid of ENECO Energie. The BioGast system is targeting yearly production of 650,000 m3 of gas—sufficient for more than 400 households.

A filling installation has been added to the BioGast which allows cars to fill up their tanks with the green gas. The Hollands Noorderkwartier Water Board will purchase natural gas fuelled cars which will run on the CO2 neutral biogas.

Interestingly, the installation is contained in a single container, allowing rapid replication of the system as a 'plug-in' that can be integrated with other sewage treatment facilities:
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The BioGast is an initiative of the Hoogheemraadschap Hollands Noorderkwartier, Biogast Sustainable Energy and ENECO Energie. Biogast sees similar installations in the agricultural sector, where dedicated biogas plants have become a common sight.

Across Europe biogas is being used more and more often as a direct replacement for natural gas. The fuel has some strong arguments in favor it (earlier post):
  • Negative Carbon Balance – Biomethane produced from the decomposition of organic waste (e.g. anaerobic digestion) actually has a negative ‘well to wheel’ carbon balance. This is due to the fact that capturing, upgrading and burning the gas prevents methane from being released into the atmosphere when waste naturally decomposes, and also because methane is an inherently low carbon fuel. The ‘Biogas as a Road Transport Fuel’ report estimated that using biomethane as a fuel in the HGV and LGV fleets could provide a saving of up to 9.1 million tonnes of CO2 per year.
  • Low Emissions of Local Pollutants – Methane fuelled vehicles have extremely low emissions of local pollutants, including NOx and particulates when compared to modern petrol and diesel vehicles. Substitution of diesel and petrol vehicles with biomethane (and also fossil methane) would have a beneficial effect on air quality.
  • Low Noise – Methane fuelled engines run more quietly than petrol and diesel, vehicles, particularly so when compared with the latter. This can have a beneficial effect on urban environmental quality, and also have economic benefits where vehicle movements are restricted because of noise limitations.
  • Link With Waste Management – Many local authorities are either developing, or planning to develop, anaerobic digestion facilities as an alternative pathway to landfill for organic waste. Vehicles are one of the best ways of using the biomethane produced from these plants. By tying the two areas together local authorities are provided with a disposal pathway for organic waste, reducing the amount of waste sent to landfill, and vehicles are provided with fuel. Costs are reduced for all parties through a joint approach.
  • Compatibility With Existing ICE Technology – Methane fuel is used in modified internal combustion engines, therefore the fuel is able to take advantage of improvements in this technology. Using biomethane alongside other technologies can therefore provide significant co-benefits, e.g. a hybrid running on biomethane would benefit from the inherent carbon reductions produced by both technologies
When biomethane is produced from dedicated energy crops, it can yield more energy than any other current type of biofuel. The green gas can be made from a very wide range of biomass crops as well as from abundant crop residues. Scientists have found [*.pdf] that for temperate grass species, one hectare can yield between 2,900–5,400 cubic meters of methane per year, enough to fuel a passenger car for 40,000 to 60,000 kilometers (one acre of crops can power a car for 10,000 to 15,000 miles).

A recent 'Biogas Barometer' report, published by a consortium of renewable energy groups led by France's Observ'ER, cites a 13.6% increase growth in biogas use for primary energy production between 2005 and 2006 in the EU (earlier post).

The total energy potential for biogas in the EU has been the subject of several projections and scenarios, with the most optimistic showing that it can replace all European natural gas imports from Russia by 2020 (more here). Germany recently started looking at opening its main natural gas pipelines to feed in the renewable green gas. And an EU project is assessing the technical feasibility of doing the same on a Europe-wide scale (previous post).

Biogas as a transport fuel offers particularly interesting prospects for the developing world, where oil infrastructures are not yet developed extensively. By relying on locally produced biomethane used in CNG cars, these countries could leapfrog into a clean, secure and green post-oil future.

For comprehensive overviews of the latest developments in biogas research, development and applications, please search the Biopact website.

ENECO Energie: Biogastinstallatie levert “groen” gas voor woningen uit rioolzuivering - September 7, 2007.

Biopact: Report: carbon-negative biomethane cleanest and most efficient biofuel for cars - August 29, 2007

Biopact: Experts see 2007 as the year of biogas; biomethane as a transport fuel - January 09, 2007

Biopact: Pre-combustion CO2 capture from biogas - the way forward? - March 31, 2007

Biopact: Biopact to chair Sparks & Flames conference panel on carbon-negative biofuels - August 08, 2007

Biopact: Hydrogen out, compressed biogas in - October 01, 2006

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