Sustainability of Next Generation Biofuels from Agricultural and Forestry Residues Emerging technologies and economic, e

1. Sustainability of Next Generation Biofuels from Agricultural and Forestry ResiduesEmerging technologies and economic, environmental and social issues Jens Giersdorf, Anastasios Perimenis, Franziska Müller-Langer International Conference on Green Industry in Asia Side-Event: „Next Generation Biofuels“ (ICS-UNIDO) Manila, 10 September 2009

2. Outline • DBFZ in a nutshell • Cooperation with ICS-UNIDO • Overview of current and next generation biofuels • Sustainability issues and biofuels • GTZ/DBFZ Study on next generation biofuels in developing countries • Background • Aim • Methodology • Country-specific results • Sustainability issues • Conclusions

3. DBFZ in a Nutshell Arised from 1953 founded „Institute for Energy“ Interdisciplinary research institute Owned by the German Federal Ministry for Food, Agriculture and Consumer Protection Monitoring, evaluation, potentials, concepts and strategies in the field of (bio-)energy Certified according to DIN EN ISO 9001 Lab-Scale and Pilot-Scale experimental working stations Six departments 3

4. DBFZ in a Nutshell 4

5. DBFZ in a Nutshell Application oriented technical, economic and environmental R&D activities concerning the energetic use of all biomass categories Auditing and certification of solid and liquid biofuels as well as conversion plants for the production of heat, electricity and fuels Consulting of private and public bodies concerning all questions related to an energy provision from biomass Market monitoring and data provision Contributions to national and international panels and committees e.g. for standardisation issues Policy assessment (e.g. Federal Ministry of Food, Agriculture and Consumer Protection, Federal Ministry of Environment) 5

6. Cooperation with ICS-UNIDO • Handbook on second generation biofuels and biorefineries • Fellow training in the field of next generation biofuels • Preparation of several scientific papers (e.g. Jatropha, biomass potential in Africa and Latin America) • Development of a decision support tool for biofuels • Workshop in Ghana 2007/08 • Participation in several workshops organised by ICS-UNIDO (e.g. Trieste, Buenos Aires): EVALUATION OF BIOFUELS - Technical, economic and environmental aspects and related Decision Support Tools

7. Conversion pathways of next generation biofuels

8. Technology overview of selected next generation biofuel options

9. Biofuel value chains regarding sustainability targets

10. Next generation biofuels in developing countries • Either case studies on current generation biofuels including developing countries, or studies on general aspects of next generation biofuels (with focus on developed countries) • Examples: • Worldwatch Institute (2007): Biofuels for Transport: Global Potential and Implications for Sustainable Agriculture and Energy in the 21st Century • International Energy Agency (2008): From 1st- to 2nd-Generation Biofuel Technologies. An overview of current industry and RD&D activities • IEA and GTZ study on „Potential for Sustainable Production of Second Generation Biofuels in Emerging and Developing Countries“ (not yet published) • Tasks of DBFZ • Country reports (Mexico, Thailand, Cameroon, Tanzania) • Sustainability chapter

11. Country studies – background • SWOT (Strength, Weakness, Opportunities and Threats) have been analysed for biofuels in developing countries in a more general way • Investigation of real potentials of biofuels under consideration of region specific frame conditions and sustainability criteria, since no biofuel option is suitable for all regions at all • to analyse and assess the effects to be expected if developing countries will be feedstock and / or biofuel provider for a global market • to develop biofuel strategies for integration of future biofuel options into national bioenergy actions plans in the medium and long term

12. Country studies – aim • Analysis and evaluation of the potential for sustainable production of 2nd generation biofuels: perspectives for emerging markets and developing countries • Systematic investigation by means of country studies for exemplary developing and emerging countries • status bioenergy / biofuels today • future potential • recommendations for biofuel strategies

13. Country studies – methodical approach

14. Country reportsMethodology • Questionnaire for local experts • Local expert point of view was encouraged • Desktop research for cross-checking • Own calculations

15. Country reportsMethodology • Emphasis on lignocellulosic residues from forestry and agriculture (primary and secondary) • No biomass potential analysis, calculations based on local experts estimates on total amount and unused amount of residues • Lignocellulose-Bioethanol, BTL and Bio-SNG considered

16. Country reportsOverview • Second generation biofuels are still in R&D phase in the developed world  introduction in developing countries is discussed only for the long term • Comparison between countries is risky due to different geopolitical, economic and social circumstances • Feedstock availability and infrastructure situation are the basic determining factors

17. Country reportsMaximum theoretical biofuel production

18. Country reportsMaximum theoretical biofuel production

19. Country reportsFuel consumption in transport

20. Maximum theoretical number of next generation biofuel plants

21. Sustainability of next generation biofuelsEstimated cost ranges Biofuel production cost ranges (DBFZ based on e.g. /Brauer, 2007; Doornbosch, 2007; Hamelinck, 2004; Kavalov, 2005; Quirin, 2007; Schmitz, 2006; Wakker, 2006)

22. Sustainability of next generation biofuelsEconomic issues • Capital investment high, financing from reliable credit sources may be a bottleneck • Biomass costs strongly depend on regional characteristics (e.g. biomass availability and price) -> secondary residues (e.g. rice husks, bagasse, palm residues) are often used for energy provision at plants • Supply costs to plants are high, especially in the case of primary residues and weak infrastructure (between 15% and 65% of total biomass costs) • Biofuel production costs depend on feedstock costs, conversion efficiencies, plant capacity & complexity, energy prices, etc. • Not expected to be cost competitive in the medium term

23. Sustainability of next generation biofuelsGHG-emissions DBFZ based on e.g./Brauer, 2008; EU, 2009; EUCAR, 2007; Macedo, 2008; Quirin, 2004; Reinhardt, 2006; Wakker, 2006; Zah, 2007

24. Sustainability of next generation biofuelsEnvironmental issues • Higher GHG mitigation potential expected for next generation biofuels, but only theoretical values, no specific assessments for developing countries • Use of residues (e.g. rice straw, field rest cane tops, rice husks, oil palm residues) may increase GHG mitigation potential but also lead to more expenditures to reach an equalised humus and nutrient balance • Since next generation biofuel technologies enable use of agricultural and forestry residues, land use competition and direct land use changes are expected to decrease • No approved methodology for assessment on indirect land use changes, risk expected to be low but removal of biomass residues (fertiliser) may decrease crop yield and lead to additional crop production somewhere else

25. Sustainability of next generation biofuelsSocial issues • Valorisation of residues may increase income of local farmers but also increase costs for local buyers (feed, bedding) • Decreased requirement for land, lignocellulose feedstock (SRC) may be cultivated on low quality land, BUT: so called “marginal land” often used extensively by local population (e.g. pasture, shifting cultivation) • No direct competition with food production if residues are used, food security is also a matter of general investment in the agricultural sector • Due to increased annual biomass demand of large plants, small holder integration would be even more challenging for production of next generation biofuels

26. Sustainability chapterConclusions and recommendations • Feedstock costs, capital investment and infrastructure situation are the determining factors for economic sustainability • Next generation biofuels have the potential to reduce impacts on food security and land competition, social sustainability depends on local integration • Participation in R&D of next generation biofuels or waiting for maturity of technology and meanwhile invest in current generation biofuels and infrastructure? • Next generation biofuels are still under R&D in the developed world, so only theoretical estimations • Monitoring of demonstration plants and careful consideration of regional circumstances necessary

27. Deutsches BiomasseForschungsZentrum gemeinnützige GmbH Torgauer Straße 116 D-04347 Leipzig www.dbfz.de Tel./Fax. +49(0)341 - 2434 – 112 / -133 International Conference on Green Industry in Asia Side-Event: „Next Generation Biofuels“ (ICS-UNIDO) Manila, 9 September 2009 Sustainability of Next Generation Biofuels from Agricultural and Forestry Residues Source: Lignocellulosic Biorefinery, VTT Technical Research Centre of Finland Dipl.-Ing. Franziska Müller-Langer Tel. +49(0)341 / 2434 – 423 franziska.mueller-langer@dbfz.de Dipl.-Pol. Jens Giersdorf Tel. +49(0)341 / 2434 – 551 jens.giersdorf@dbfz.de