Introduction – Biorefineries and the bioeconomy

1. Optimal Supply Chain Design of Green Biorefineries in Austria - Assessment of Current and Potential Policy Support SchemesStefan Hoeltinger, Johannes Schmidt, Martin Schoenhart & Erwin Schmid

2. Introduction – Biorefineries and the bioeconomy Biorefinery concept is the key to meet major objectives of a Knowledge-Based Bio-Economy (KBBE) Substitution of fossil fuels Reduction of greenhouse gas emissions Efficient use of biomass resources (for material and energy production) Establish competitive bio-based industries Increase regional value added „Biorefining is the sustainable processing of biomassinto a spectrum of marketable bio-based products and bioenergy” IEA - Task 42 Biorefineries

3. Introduction – The Green Biorefinery Concept Feedstocks green biomass (fresh grass, grass silage, sugar beet leaves, …) Products organic acids, feed proteins, fibre products, electricity and heat Drivers for the green biorefinery concept in Austria Expected oversupply of grassland areas due to changes in agricultural policies and structures Alternative utilization for grassland biomass to preserve cultural landscape Employment opportunities for rural areas

4. Introduction – The Green Biorefinery Concept Simplified process overview of the green biorefinery demonstration plant in Utzenaich, Austria and biogas as reference technology Grass silage Grass silage Mechanical separation Press juice Press cake Membrane separation Biogas + Chp Biogas + Chp Ion exchange chromatography Electrodialysis Amino acids Lactic Acid Heat Electricity Heat Electricity

5. Methods and Data Spatially explicit mixed integer programming model that maximizes profits of the whole supply chain by selecting optimal plant type, location and capacity The model considers feedstock-, transportation-, operation- and capital costs revenues from product sales Regional disparities in biomass supply and heat demand determine profitability and sustainability of biomass supply chains Spatially explicit data for Regional biomass supply (aggregated to 250 supply regions) heat demand (MWh) pro km² (Schmidt et al., 2010)

6. Methods and Data Sensitivity analysis - Monte-Carlo simulation to deal with uncertainties of input parameters varying market conditions upscaling costs efficiency of conversion technologies 5 Policy Scenarios No policy support schemes Feed-in tariff 150 € per MWhelectricity Feed-in tariff 100 € per MWhelectricity Investment subsidy 20 % of total investment costs Processing-aid for cascade utilization of grass silage in a green biorefinery 10 € per t dry matter (dm) grass silage

7. Results – feedstock assessment • Positive Agricultural Sector Model Austria (PASMA) • Supply curve for energetic and material utilization of grass silage • No effect on livestock numbers • Additional supplies through • Intensification measures (Nitrogen fertilizer inputs) • Crop rotation changes on arable land • Increased feed imports

8. Results – feedstock assessment • Feedstock prices paid by biogas plants and green biorefineries for all 500 simulation runs

9. Results - capacities • Mean capacities and transportation distances for the realized green biorefineries and biogas plants for all 500 Monte Carlo simulation runs • Biorefineries are more capital intensive than biogas plants -> • larger capacities to benefit from economies of scale for capital costs

10. Results – profitability Subsidies Amino acids Lactic acid Electricity Heat • Relative revenues for different policy scenarios • Guaranteed feed-in tariffs contribute to up to 55 % of biogas revenues • Revenues of green biorefineries largely dependent on market prices for organic acids

11. Feedstock costs Transportation costs Variable operation costs Capital costs Results – profitability • Relative costs for different policy scenarios • Feedstock costs contribute about 50 % of biogas costs • Energy intensive downstream and separation technologies are the main drivers for the costs green biorefineries

12. Results – profitability • Boxplots for the profitability of green biorefineries (GBR) and biogas plants • Higher profits for green biorefineries, but also higher uncertainty

13. Conclusions and outlook Green biorefineries can offer a profitable utilization pathway for grass silage in Austria under favourable market conditions Profitability of green biorefineries is very sensitive to market prices of organic acids the development of separation and downstream costs upscaling costs from pilot- to industrial scale Profitability of biogas plants is largely dependent on the current policy support schemes (feed-in tariffs) Sustainability assessment along the whole supply chain to prove ecological sustainability of green biorefinery concept More intensive cultivation methods and longer transportation distances

14. Thank you for your attention University of Natural Resources and Life Sciences, Vienna Department of Economics and Social Sciences Institute for Sustainable Economic Development Stefan Hoeltinger, Johannes Schmidt, Martin Schoenhart & Erwin Schmid Feistmantelstraße 4, A-1180 Vienna Tel.: +43 1 47654-3650 stefan.hoeltinger@boku.ac.at , www.boku.ac.at/454.html 14