Commercializing New Biomass Energy Technologies

1. Commercializing New Biomass Energy Technologies Eric D. Larson Princeton Environmental Institute Princeton University USA International Society of Sugar Cane Technologists International Sugarcane Biomass Utilization Consortium Third Meeting, 28 June – 1 July, 2009 Shandrani Resort, Mauritius

2. My goals in this talk • Discuss context for a new sugarcane-biomass energy technology initiative. • Overview of thermochemical and biochemical biomass conversion technologies. • Discuss gasification-based technologies and economics, including co-gasification of biomass with coal and CO2 capture and storage. • Provide some technology cost and performance estimates that might be useful for “back-of-envelope” project calculations. • Wrap-up thoughts/questions for further ISBUC discussions.

3. > $100/bbl by 2012-2015 What Future Oil Prices ? Low Price, Reference Case, and High Price projections are from the U.S. Department of Energy, Energy Information Administration, Annual Energy Outlook 2009 (March 2009). Subsequently (April 2009) EIA revised Reference Case projection to reflect expectation that world recession would last longer than expected in AEO 2009.

4. 70 60 50 40 30 20 10 0 GHG Emissions, Gt CO2 equivalent per year Business-as-usual emissions 62 GtCO2eq Power sector Industry Buildings Transportation Targeted emissions 14 GtCO2eq Climate Change Issues/Opportunities • To avoid dangerous climate change (ΔT > 2oC), global GHG emissions by 2050 must be: • ½ current emissions level, or • Less than ¼ of projected 2050 “business-as-usual” emissions. • IEA projects GHG emissions price in 2030 in OECD: • $90/t for 550 ppmv stabilization • $180/t for 450 ppmv stabilization • Biomass will become much more valuable (including possibility for negative GHGemissions when biomass is used with CO2 capture and storage (CCS). Source: International Energy Agency, Energy Technology Perspectives, 2008

5. Prospects for Holding CO2 Highly Prospective Low to High Prospective Non Prospective Intergovernmental Panel on Climate Change on CCS • Based on observations and analysis of current CO2 storage projects (several storing ~106 tCO2/yr), natural systems, engineering systems, and models: • CO2 injected underground is very likelyto stay there for > 100 yrs. • CO2 injected underground is likelyto stay there > 1000 yrs. • Large potential for CO2 storage in deep sedimentary basins Source: B. Metz, O.Davidson, H. de Coninck, M. Loos, and L. Meyer (eds.), Figure SPM.6b in “Summary for Policymakers,” IPCC Special Report on Carbon Dioxide Capture and Storage,Cambridge University Press, Cambridge, 2005.

6. Parallels Between Coal IGCC and BIG/GT Development? • Coal gasification proponents say coal-IGCC is superior to conventional technology options: • higher efficiency than conventional coal power plants. • Inherently much lower air emissions than conventional power plants. • electricity generating cost in U.S. not higher than new conventional coal plant. • But IGCC is not a routine commercial option for new coal power (despite first major demonstration in 1970s) because: • Conventional plants can meet emissions regulations with add-on investments. • Many existing coal plants are already paid off (esp in U.S.), so existing generating costs are much lower than for a new conventional coal plant. • IGCC experience is not yet sufficient to ensure low level of risk that goes with new conventional coal plant. • Lesson: new technology must offer significantlybetter economics or opportunity to justify taking risks needed to establish it in market. • Coal gasification is widely practiced in China, but for chemicals. • Analogy: the PC did not replace the typewriter because it significantly improves typing – it provides many other benefits.

7. New context for thinking about sugarcane biomass energy • High oil (and natural gas) prices likely to be sustained • energy insecurity in U.S. and China are driving big investments in new technologies for transport fuels from biomass and coal. • Some major private sector players are getting involved, e.g. Shell, BP, GE, Sasol, others. • Awareness of need for urgent action on climate change is growing rapidly (COP 15 - Copenhagen will continue to build this awareness). • Gasification power from biomass that has only marginal economic benefits may not be compelling enough reason for commercializing biomass gasification – liquid fuels or co-production appear more promsing.

8. Basic Biomass Conversion Options advanced technology options Ethanol Biochemical Alt. Liquid fuels Bagasse, Trash Gasification Electricity B D Combustion Electricity

9. Combining of two steps proposed: simultaneous saccharification and fermentation – SSF Combining of three steps proposed: consolidated bioprocessing – CBP Biochemical conversion of biomass Raw Biomass • Current technology • Separate pretreatment  hydrolysis using purchased enzymes (cellulases) to liberate C5 and C6 sugars  C6 fermentation. • C5 fermentation has been demonstrated at pilot scale. • Near future technology • Pretreatment + combined enzyme hydrolysis and fermentation • More future technology • Consolidated bioprocessing: one reactor for enzyme production, hydrolysis, fermentation. Ethanol Pretreatment Recovery & Distillation Hydrolysis Fermentation Solids separation Steam & power generation Enzyme production Process steam & electricity • May 2009 study from U.S. National Academy of Sciences: • Ethanol yield with current known technology: ~260 liters/dry t biomass • Future-technology yield: ~330 liters/dry t biomass

10. Air, O2, and/or steam Electricity Bagasse, Trash Drying Sizing Gasification (1 to 30 bar) Gas Turbine Heat Recovery Steam Turbine BGCC Process steam Gas cleaning Biomass to Liquids Catalytic Synthesis Distillation or Refining Water Gas Shift (CO+H2O  H2+CO2) Liquid Fuel CO2 Removal CO, H2, CH4, CO2 Steam & Power Generation Process steam/elec. Hybrid thermochem/biochem fuels production (one example) Distillation or Refining Fermentation Alcohols Steam & Power Generation Process steam/elec. Gasification-based conversion of biomass

11. Biofuel substitutes for  Conventional Fuel Ethanol Gasoline Mixed alcohols Diesel Methanol / MTG LPG Fischer Tropsch Paraffin Dimethyl ether Kerosene Biocrude Crude oil HYDROLYSIS GASIFICATION

12. Fuels that can be made via gasification • Fischer-Tropsch Liquids (FTL) • Diesel substitute + naphtha/gasoline co-product • Technology from 1930s, large interest in coal-to-FT today • Dimethyl ether (DME) • Similar to LPG (25% blend with LPG acceptable) • Excellent diesel fuel, but needs pressurized fuel systems • Large production from coal in China, Iran • Substitute natural gas (SNG) • Syngas methanation technology is commercial • Low temperature of biomass gasification favors CH4 • Hydrogen (H2) • Technology for H2 from syngas is commercial • Can provide the H2 needed for NH3 production

13. Comparing thermochemical and biochemical systems Black – technology features Red – development status Blue – key hurdles

14. Vent to atmosphere or compress for transport/injection. Gasification-based fuels from biomass and/or coal • All conversion component technologies are commercial (or near-commercial in the case of biomass gasification). • CO2 removal is intrinsic part of the process. • Projects to demonstrate CO2 capture from coal and storage at mega-scale (> 106 tCO2/yr injection) are in active development in USA, Europe, Australia, and China – will require ~10 years to gain confidence needed for widespread implementation.

15. CCS for biomass • Coal is target for most CCS developments, but if CCS works for coal, it can also be considered for biomass • With CCS, biomass goes from “carbon neutral” to “carbon-negative” as a result of geological storage of photosynthetic CO2. • Attractive approach: co-process biomass with coal: • Economies of scale of coal conversion. • Low cost of coal as feedstock. • Negative CO2 emissions of biomass offsets unavoidable coal-derived CO2 net-zero GHG emission fuel can be produced. • One commercial operation already co-gasifying coal and biomass (Buggenum IGCC, Netherlands) for power generation; several U.S. projects in development for fuels.

16. Three designs for coal/biomass co-processing with CCS.

17. Coal/Biomass co-processing for Fischer-Tropsch diesel and gasoline, with CO2 capture for storage

18. Carbon/GHG flows for coal/biomass system with CCS.~40% of input energy from biomass gives ~0 GHG emissions

19. Coal-FTL Coal-gasoline (MTG) Coal-FTL w/CCS Coal-MTG w/CCS Current Ethanol Ethanol Coal/bio-MTG w/CCS Coal/bio-FTL w/CCS Bio-FTL Bio-MTG Ethanol w/CCS Bio-FTL w/CCS Bio-MTG w/CCS Net lifecycle GHG emissions with alternative fuels from coal and/or biomass relative to petroleum-derived fuels

20. Co-processing for FTL, MTG Amount of biomass needed with different technologies to make fuels having ~zero net lifecycle GHG emissions • One liter of fuel from biomass via thermochemical or biochemical processing requires about same amount of biomass feedstock. • Co-processing biomass with coal to make a liter of zero-GHG liquid fuels requires half or less as much biomass as a “pure” biofuel.

21. Yields of low/zero net GHG liquid fuels per t biomass * Pure biomass cases with CCS (BTL-RC-CCS and BTG-RC-CCS) have strong negative GHG emissions, so some petroleum-derived fuel can be used and still have overall GHG emissions = 0. * *

22. Production costs (“Nth” plant) for alternative biomass-based liquid fuels.* $100/bbl crude oil Petroleum gasoline $50/bbl crude oil $ per liter of gasoline equivalent (2007$) Assumptions: Biomass input rate ~1500 dry t/day; biomass price, $1.5/GJHHV; coal price, $1.7/GJHHV; capital charge rate = 0.15/yr.

23. Production costs (“Nth” plant) for alternative biomass-based liquid fuels.* $100/bbl crude oil Petroleum gasoline $50/bbl crude oil $ per liter of gasoline equivalent (2007$) Assumptions: Biomass input rate ~1500 dry t/day; biomass price, $1.5/GJHHV; coal price, $1.7/GJHHV; capital charge rate = 0.15/yr. *Ethanol from U.S. National Academy of Sciences study (May 2009), which projects achievable future yield of 334 lit/dry tonne switchgrass with capex as indicated above. FTL estimates are based on analysis by Princeton Univ. researchers (e.g., see paper from Pittsburgh Coal Conference 2008, www.princeton.edu/pei/energy/publications)

24. Production costs (“Nth” plant) for alternative biomass-based liquid fuels.* $100/bbl crude oil Petroleum gasoline $50/bbl crude oil $ per liter of gasoline equivalent (2007$) Assumptions: Biomass input rate ~1500 dry t/day; biomass price, $1.5/GJHHV; coal price, $1.7/GJHHV; capital charge rate = 0.15/yr. *Ethanol from U.S. National Academy of Sciences study (May 2009), which projects achievable future yield of 334 lit/dry tonne switchgrass with capex as indicated above. FTL estimates are based on analysis by Princeton Univ. researchers (e.g., see paper from Pittsburgh Coal Conference 2008, www.princeton.edu/pei/energy/publications)

25. Production costs (“Nth” plant) for alternative biomass-based liquid fuels.* $100/bbl crude oil Petroleum gasoline $50/bbl crude oil $ per liter of gasoline equivalent (2007$) Assumptions: Biomass input rate ~1500 dry t/day; biomass price, $1.5/GJHHV; coal price, $1.7/GJHHV; capital charge rate = 0.15/yr. *Ethanol from U.S. National Academy of Sciences study (May 2009), which projects achievable future yield of 334 lit/dry tonne switchgrass with capex as indicated above. FTL estimates are based on analysis by Princeton Univ. researchers (e.g., see paper from Pittsburgh Coal Conference 2008, www.princeton.edu/pei/energy/publications)

26. Investment estimate for gasifier-GTCC power (Nth plant, U.S. site, 2007 prices) Bagasse plus 50% of trash from 2 million tcane/yr 6 million tcane/yr MW Electric Export to Grid  Investment cost 

27. Electricity Selling Price, US$ per MWh (2007 levels) (including 10% return on investment) price US $ per MWh  Weighted cost of bagasse ($15/dry t) + trash ($40/dry t). Is this a compelling case for BIG-GT commercialization ? Electricity selling price for stand-alone gasifier-GTCC power plant (“Nth plant” U.S. price estimate) Financial assumptions (U.S. conditions)

28. Surplus Electricity (100% bag + 50% trash + meeting mill process steam and electricity needs) Nitrogen Fertilizer Prod (50% bag + 50% trash) Some numbers: potential yields from sugarcane biomass Liquid Fuels Production From 50% of bagasse + trash (0.14 tonnes dry biomass total per tc)

29. Mauritius potential electricity, fuels, fertilizer from sugarcane

30. Summary thoughts • Gasification is technologically close to being commercial. • Economics of gasification for power have not been sufficient to get over the “hump” since idea first recognized ~25 years ago. • Coal gasification (and past biomass IGCC) experience suggest gasification must provide “disruptive” benefits to succeed. • Electricity production may not be disruptive enough. • Liquid fuel production may be disruptive enough. • Gasification is well suited to make fuels/chemicals in addition to power. • Co-production of fuel and power may be most disruptive of all. • World oil price volatile; co-production is a hedging strategy. • Strong GHG mitigation policy needed to avoid planetary overheating – such policies will also help protect co-producer against oil price collapse. • Carbon-based fuels/power with low lifecycle GHG emissions will grow in value, and negative GHG emissions potential of biomass is likely to be high value in long term. • Gasification strategy that foresees it as technology platform for fuels/chemicals/ power co-production may provide a compelling motivation for commercialization. • Sugarcane industry is unique in having experience with large-scale biomass handling, with liquid fuels production, with power generation, and (in Mauritius) with coal use. • But commercializing gasification will require a big effort.

31. Varnamo (Sweden) operation 1993-1999 • 20 MWbiomass GTCC + district heating. • > 8,500 hours pressurized gasification • > 3,600 hours integrated operation. • Technical success, butlarger scale needed for successful economics. • ARBRE (UK) low-P gasifier, 8 MWe GTCC • Successful partial commissioning (2000/01) • Institutional problems end project in 2002. SIGAME (Bahia), 32 MW, 1991-2003 • Low-P gasifier • Detailed engineering completed, GE turbine modified • Plantations established • Institutional problems end project. Past BIG-GT commercialization efforts

32. Challenges to commercializing biomass gasification Engineering • Efficient biomass drying, e.g. using low-temperature waste heat • Gasifier feeding of bagasse/trash (more for pressurized gasification) • Tar cracking/gas cleaning • Operational reliability and availability Financial • Finding the money • Demonstrating the competitiveness • Investment cost • O&M cost • Fuel cost • Energy or product price Institutional • Getting support from the right partners (engineering, finance, institutional) • Getting the right institutional and organizational arrangement to carry forward the demonstration and continue on to commercial deployment.

33. Some considerations for ISBUC • Past work (e.g., Arbre, Varnamo, and other projects) provides information needed to design a commercial-scale gasification installation. • A minimum scale is needed to be convincing as a commercial demonstration and to achieve acceptable economics. What should be the scale? • What should be produced? Power? Fuel? Power and Fuel? • How about co-processing biomass and coal in an already-commercial coal gasifier? • What are ISBUC’s long-term objectives – beyond a demonstration project?

34. Thank you!

35. Scale of Sugarcane Processing Plants in Southeast Brazil 4000 3000 2000 Approximate dry t/day recoverable biomass 1000 0 Source: UNICA, Ranking de Produção,www.unica.com.br/referencia/estatisticas.jsp

36. Fischer-Tropsch liquids (FTL) from coal w/ or w/o CCS.

37. Fischer-Tropsch liquids (FTL) from biomass w/ or w/o CCS B-FTL, B-FTL-CCS

38. GHG Emissions of Alternative Biomass-Based Liquid Fuels

39. Trajectory of GHG emissions price (in 2007 $/tCO2eq) that translates to a levelized GHG emissions price of $50/tCO2eq Levelized GHG Emissions Price, 2016-2035