Next Generation Biofuels: Market Drivers, Growth Opportunities And Regulatory Change -Aarkstore Enterprise

The world's dependence on crude oil for				Renewable energy targets 166
transportation is particularly marked, with the				Kyoto Protocol 166
International Energy Agency (IEA) estimating that				European Union 166
fuels from crude oil currently supply about 96% of				US 169
the worldwide energy demand for transport				Renewable Fuel Standard (RFS) 169
purposes.				Renewable Portfolio Standards (RPS) 170
As the world's population grows and developing				Developing nations 171
countries look to expand their economies, this				Biofuels targets 172
insatiable demand for fossil fuels is unlikely to show				Biofuels policy overview by region 173
any sign of easing, with oil and gas accounting for				The European Union 173
60% of the world's increasing energy demand				Biofuels Directive 173
between now and 2030. Furthermore, with most				Directive 2003/96/EC 174
significant reserves of fossil fuels unevenly distributed				Incentives for biofuels 174
throughout the world, energy security is set to				Tax incentives 175
become an increasingly critical economic and political				The United States 177
issue over the coming decades. Real or perceived				US Energy Policy Act 2005 177
disruptions to the global supply of fossil fuels –				Brazil 178
notably crude oil – are likely to grow in frequency				Proalcool Program 178
and cause wild fluctuations in the price of energy, as				India 179
they have done so in the past.				Biodiesel policy 179
However, one of the most pressing reasons for				Bioethanol policy 180
seeking alternative sources of energy and fuel lies in				China 181
the form of climate change. The combustion of fossil				National Biomass Ethanol Gasoline Project 181
fuels releases carbon dioxide (CO2), a potent				The Renewable Energy Law of the People's Republic
‘greenhouse gas' (GHG), which are considered to				of China 181
be responsible for ‘global warming'. According to				Chapter conclusion 182
the IEA, if no changes are made to the world's				Report conclusion 183
existing energy economy, related emissions of CO2				Abbreviations 186
will grow marginally faster than energy use, meaning				Energy content and conversion rates 187
that by 2030 global CO2 emissions will be more than				Index 189
50% higher than today. Over two-thirds of that				List of Figures
projected increase in emissions is expected to come				Figure 2.1: World renewable energy, 2008 30
from emerging economies, such as India, China –				Figure 2.2: Current and predicted EU biomass
both of which are set to rely heavily on coal-based				resources (Mtoe/y) 33
power stations to drive their rapidly developing				Figure 2.3: Current and potential US biomass
economies.				resources (Million dry tonnes/y), 2005 34
Key features of this report				Figure 2.4: Potential power generation from biomass
• Analysis of biofuels by type, resources available,				among ASEAN countries (MW) 36
production volumes, production technology capacity				Figure 2.5: Breakdown of currently available biomass in
installed.				China by type 37
• Market projections to 2020, including an				Figure 2.6: Maximum regional bioenergy production
evaluation of energy type and national and				potential, 2050 38
international growth potential.				Figure 2.7: Typical oil extraction from 100kg of oil
• Overview of trends impacting on and shaping				seeds (kg) 44
innovation in the energy market.				Figure 3.8: Global biosphere, 1998 60
• New renewable energy technology analysis				Figure 3.9: Biofuels time period to availability (years),
including innovation, capacity and biofuels investment.				2009 61
Scope of this report				Figure 3.10: Cushing, OK WTI Oil Spot Price FOB
• Achieve a quick and comprehensive				prices (Dollars per Barrel), 1986-2009 66
understanding of how global market trends and				Figure 4.11: Relative competitiveness of alternative
legislation are influencing the development of the				energies in five years, 2009 69
biofuels industry.				Figure 4.12: Relative economic competitiveness of
• Realize up to date competitive intelligence				biofuels now and in the next five years, 2009 70
through a comprehensive review of global markets in				Figure 4.13: What proportion of global fuel production
the biofuels energy industry between 1990 and 2008.				will biofuels account for by 2020? 71
• Assess the emerging trends in the biofuels				Figure 4.14: Within how long will biofuels account for
industry – Biomethanol, Hydro Thermal Upgrading				the primary source of global fuel production? 72
(HTU) diesel, Fischer-Tropsch (FT) diesel,				Figure 4.15: Which regions will lead the development
Lignocellulosic ethanol, Algae fuel, Photo-bioreactors				of biofuels over the next five years? 73
carbon emission absorption.				Figure 4.16: How important will the following factors
Key Market Issues				be in driving the biofuels market over the next five
• Environmental regulations: Environmental targets				years? 74
set to control Carbon dioxide emissions globally are				Figure 4.17: How important will the following factors
creating a path for lower carbon emission fuel				be in inhibiting the biofuels market over the next five
technologies.				years? 75
• Energy security:- Oil pricing structures are volatile				Figure 4.18: Biofuels impact on global food crop prices,
and uncontrollable, due to the majority imported from				2009 76
non-domestic countries. This volatility is likely to				Figure 5.19: Projected world energy demand to 2030
increase as reserves of the natural resources decline.				(Mtoe) 82
• Resource allocation: Some of the currently				Figure 5.20: Growth in energy demand by region
available biofuels have a number of disadvantages				(2000-2030) 83
that are related to their feedstock. The current costs				Figure 5.21: Projected worldwide oil consumption
of rapeseed biodiesel and ethanol from cereals or				(million barrels per day), 2005-2025 84
beets are much higher than the costs of petrol or				Figure 5.22: Average annual oil price (US$ per barrel),
diesel, with substantial subsidies required to make				2008 89
them competitive. Second generation biofuels have				Figure 5.23: Opting for green energy is one
been developed due to limitations of first generation				behavioural aspect of rising environmental attitudes
biofuels, primarily that the resources used threatens				90
food supplies.				Figure 5.24: The potential biomass availability of EU15,
				AC10 and/or Europe according to five studies (left
Key findings from this report				part of the figure) 94
• Worldwide production of biodiesel reached				Figure 6.25: Cost of distribution and dispensation of
11,016m liters per annum, with the EU representing				various fuels from a central production facility to a
72% of that global biodiesel production and				filling station (€/GJ) 105
consumption.				Figure 6.26: Costs of various biofuels at the filling
• Germany, France, Italy, the UK and Austria				station using existing technology (2004) 106
were the largest biofuels consumers in the EU in				Figure 6.27: An algae production process, 2009 109
2008. The USDA forecasts that biofuels consumption				Figure 6.28: Algal fuel capacity projections 2009-2014,
in the EU will continue to grow throughout 2009,				2009 112
despite the economic downturn. The increase is a				Figure 6.29: Gasoline ethanol (kpa/%v/v), 2008 114
result of mandates and tax incentives.				Figure 6.30: Car costs (€) and fuel efficiencies (km
• There are currently 192 bioethanol production				GJ of fuel) of passenger cars by fuel and engine
plants in the US, which together have a production				system 115
capacity of 36,300m liters per year.				Figure 7.31: Worldwide biofuels fuel production volume
• The US accounted for 24% of the global				(billion liters), 2008 123
biodiesel market in 2008 – accounting for 2,650m				Figure 7.32: Global bioethanol production growth
liters per annum.				(thousand tons of oil equivalent), 1998-2008 126
• It is also notable that Brazil is by far the world's				Figure 7.33: Top bioethanol producing countries
largest exporter of ethanol at 3.5bn liters (from				(thousand tons of oil equivalent), 2008 127
production of 19bn liters). Production is estimated by				Figure 7.34: Biodiesel (million L/a), 2009 129
the IEA to increase to over 4bn liters in 2009. Most				Figure 7.35: Bioethanol in Europe (million L/a), 2008 131
exports go to the US, Europe, Korea and Japan.				Figure 7.36: Biodiesel production in Europe (million liters
Key questions answered				annum), 2009 136
• What are the drivers shaping and influencing				Figure 7.37: EU market share of biodiesel production in
development in the biofuel industry?				2008 (%), 2009 138
• How will biofuels production share perform to				Figure 7.38: Projected US ethanol production (billions
2020? What are the opportunities?				of gallons), 2006-2012 142
• What are the forecast market growth rates				Figure 7.39: US ethanol market revenue forecast
2008-2030? Which markets will see the highest value				($bn), 2006-2012 143
growth and which the highest volume growth?				Figure 7.40: US bioethanol development (million L/a),
• Which regions and countries offer the greatest				2009 144
opportunity for growth?				Figure 7.41: US biodiesel (million L/a), 2009 147
Table of Contents :				Figure 7.42: Brazil biofuels development (million L/a),
Table of Contents				2009 150
Next Generation Biofuels				Figure 8.43: Renewable fuels targets in the US (billions
Executive summary 14				of gallons per year), 2006-2012 170
What are biofuels? 14				Figure 8.44: EU biofuels targets, 2008 174
Next generation biofuels 15				List of Tables
Industry forecasts for biofuels 16				Table 2.1: World renewable energy, 2008 29
Biofuels drivers and inhibitors 17				Table 2.2: Population, energy consumption and
The biofuels economy 18				biomass contribution in selected regions, 2005 31
Biofuels market size and forecasts 19				Table 2.3: Current and predicted EU biomass
Biofuels policies and regulations 20				resources (Mtoe/y) 32
Chapter 1 Introduction 22				Table 2.4: Current and potential US biomass resources
Audience 22				(Million dry tons/y), 2005 34
How to read this report 22				Table 2.5: Potential power generation from biomass
Chapter 2 What are biofuels? 26				among ASEAN countries (MW) 35
Summary 26				Table 2.6: Breakdown of currently available biomass in
World energy demand 27				China by type 37
Climate change 27				Table 2.7: Maximum regional bioenergy production
Renewable energy 28				potential, 2050 38
Biomass 30				Table 2.8: Typical oil extraction from 100kg of oil
What is biomass? 30				seeds (kg) 44
Population, energy consumption and biomass 31				Table 3.9: Comparison of first and second generation
Regional resources 32				biofuels 48
What are biofuels? 39				Table 3.10: Biofuels comparison (Liters of oil yields
Solid biofuels 40				(hectares/year)), to 2009 59
Liquid biofuels 40				Table 3.11: Viable Bio-SPK feedstock alternatives,
Gas biofuels 41				2009 61
Biofuels in current use 41				Table 3.12: Fuel property comparisons: Neat, 2009 63
Ethanol 41				Table 3.13: Fuel property comparisons: Blends, 2009
Distribution, storage and blending 42				64
End-use 42				Table 5.14: Projected world energy demand to 2030
Biodiesel 42				81
Distribution, storage, blending 43				Table 5.15: Growth in energy demand by region
End-use 43				(2000-2030) 82
Chapter 3 Next generation – advanced biofuels				Table 5.16: Projected worldwide oil consumption
46				(million barrels per day), 2005-2025 84
Summary 46				Table 5.17: CO2 equivalent emissions savings from
Introduction 47				biofuels (g/km), 2006 85
Second generation biofuels 49				Table 5.18: Average annual oil price (US$ per barrel),
Second generation biofuels under development 51				2008 88
Biohydrogen 51				Table 5.19: Key barriers for biofuels 91
BioDME 51				Table 6.20: Production costs of biofuels from various
Biomethanol 51				crops 103
Butonal and Isobutanol 52				Table 6.21: Cost of distribution and dispensation of
Dimethylfuran (DMF) 52				various fuels from a central production facilityto a
Hydro Thermal Upgrading (HTU) diesel 52				filling station (€/GJ) 104
Fischer-Tropsch fuels 52				Table 6.22: Costs of various biofuels at the filling
Bioconversion of biomass to mixed alcohol fuels 53				station using existing technology (2004) 106
Wood diesel 53				Table 6.23: Cost comparison of biofuels with gasoline
Key players in second generation biofuels 53				fossil fuels 107
Market possibilities for second generation biofuels 54				Table 6.24: Cost estimates of various biofuels at the
Third generation biofuel 55				filling station using future technology, post- 2010 108
Algae fuel 55				Table 6.25: Cost of harvesting, dewatering and drying
Background 55				algae, 2009 110
Limitations of previous biofuels 56				Table 6.26: Top biofuels companies, 2009 111
Algae types 56				Table 6.27: Algal fuel capacity projections 2009-2014,
Algae cultivation 57				2009 112
Photo-bioreactors 57				Table 7.28: Comparison of worldwide fuel production
Closed loop systems 57				from hydrocarbon sources versus biomass sources,
Open pond systems 58				2005 122
Algae fuel potential 58				Table 7.29: Worldwide biofuels fuel production volume
Development timeline 60				(bn liters), 2008 122
Aircraft biofuels testing 61				Table 7.30: Amounts of raw materials to meet
Key players for third generation biofuel 64				worldwide fuel demand, 2005 123
Market possibilities for algae biofuel 65				Table 7.31: Global bioethanol production (thousand
Chapter 4 Forecasts for biofuels 68				tons of oil equivalent), 2008 125
Summary 68				Table 7.32: Biodiesel (million L/a), 2008 128
Introduction 69				Table 7.33: Bioethanol in Europe (million L/a), 2008 130
Economic competitiveness of biofuels and biomass 69				Table 7.34: EU bioethanol production, supply and
Biofuels technology development 72				demand (1,000MT) 132
Biofuels drivers and inhibitors 73				Table 7.35: EU bioethanol production - number of
Chapter conclusion 76				plants and capacity (1,000 MT) 132
Chapter 5 Biofuels drivers and inhibitors 80				Table 7.36: Feedstock use for bioethanol production
Summary 80				(1,000MT) 133
Market background 81				Table 7.37: EU bioethanol consumption – main
Drivers of the biofuels market 85				consumers (1,000 MT) 134
Greenhouse gases and environmental concerns 85				Table 7.38: EU bioethanol and gasoline consumption
Regulatory incentives/pressure 86				(Ktoe) 134
Concern about energy security 88				Table 7.39: Biodiesel production in Europe (millions liters
Rising cost of existing fuel supplies 88				annum), 2009 135
Consumer pressure 90				Table 7.40: EU Biodiesel production – number of
Inhibitors of the biofuels market 91				plants and capacity (1,000 MT) 137
The biofuels economy 92				Table 7.41: EU market share of biodiesel production in
Sustainability concerns and the rising price of food				2008 (%), 2009 138
crops 92				Table 7.42: Feedstock use for biodiesel production
Limited biofuels infrastructure 93				(1,000MT), 2009 139
Biomass and land availability 94				Table 7.43: EU biodiesel consumption (1,000MT), 2009
Chapter 6 The biofuels economy 98				140
Summary 98				Table 7.44: EU biodiesel and diesel consumption
Introduction 99				(Ktoe), 2009 140
American market 99				Table 7.45: Projected US ethanol production (billions
American Recovery and Reinvestment Act of 2009				of gallons), 2006-2012 141
100				Table 7.46: US ethanol market revenue forecast
Biofuels new direction away from corn-based ethanol				(US$bn), 2006-2012 142
101				Table 7.47: US bioethanol development (million L/a),
The biofuels economy 102				2009 143
Production costs 102				Table 7.48: Existing and future ethanol capacity in the
Cost of distribution 103				US, 2009 145
Cost at filling station 105				Table 7.49: US biodiesel (million L/a), 2009 146
Third generation algae fuel costs 108				Table 7.50: Ethanol profile comparison of the US and
Algae fuel leading players costs comparison 110				Brazil (2006) 148
Transport fuel blends 113				Table 7.51: Brazil biofuels development (million L/a),
Car costs and fuel efficiency 114				2009 149
Chapter conclusion 116				Table 7.52: Brazilian biodiesel production, supply and
Chapter 7 Biofuels market size and forecasts 120				demand (January-December, 000 Liters), 2009 151
Summary 120				Table 7.53: Brazilian fuel consumption matrix (000 m3)
Worldwide energy demand 121				151
Biofuels market sizing 124				Table 7.54: Brazilian soybeans and products production
Worldwide 124				(000 hectares, 000 metric tons) 152
Ethanol 124				Table 7.55: Brazilian cotton and products production
Biodiesel 127				(000 hectares, 000 metric tons) 152
Europe 130				Table 7.56: Projected demand and supply of ethanol
Ethanol 130				in India for 5% blend with gasoline 153
Biodiesel 134				Table 7.57: India's ethanol requirement for 5%
US 141				blending with gasoline sugar 154
Ethanol 141				Table 7.58: India's production & distribution of
Biodiesel 145				molasses and alcohol/ethanol in sugar (million Tons/
Brazil 147				million Liters), 2008 155
Ethanol 147				Table 7.59: Projected demand for gasoline and diesel
Biodiesel 150				in India to 2012 (MT) 156
India 153				Table 7.60: Diesel and biodiesel demand in India using
India's fuel economy 153				Jatropha (MT) 157
Ethanol 153				Table 7.61: China's major biodiesel plants production
Biodiesel 155				capacity (MT), 2008 159
China 157				Table 8.62: Biofuels infrastructure profiles,Q209 165
China's fuel economy 157				Table 8.63: Mechanisms to incentivize renewable
Ethanol 157				energy generation 166
Biodiesel 158				Table 8.64: EU renewable energy targets for 2020
China working with the US for biofuels development				(%) 168
159				Table 8.65: Renewable fuels targets in the US (billions
Chapter 8 Biofuels policies and regulations 162				of gallons per year), 2006-2012 169
Summary 162				Table 8.66: Biofuels energy targets 172
Introduction 164				Table 8.
Policy frameworks 165

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Next Generation Biofuels: Market Drivers, Growth Opportunities And Regulatory Change -Aarkstore Enterprise

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