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Combining agriculture with market and climate protection policies

Biofuels Digest - Sat, 02/02/2019 - 3:00pm

In Germany, the Union for the Promotion of Oil and Protein Crops formulated its policy expectations and presents it in their third edition of the Global Market Supply Report. UFOP refers to the generally good global supply situation for the most important agricultural commodities. The updated report also takes into account the raw material requirements for biofuel production and material utilization as a renewable raw material. UFOP criticizes that this supply situation does not play a role in the political assessment of harvest results and calls for maintaining the sales outlook in the fuel markets.

So far, international politics is failing regarding the “limits” of globalization and the liberalization of agricultural trade. From the viewpoint of UFOP, this is one more reason to include the material and energy use of cultivated biomass in a climate protection strategy.

In the course of the revision of the Renewable Energy Directive (RED II), the European Union failed to properly integrate this potential into climate protection policy. On the contrary: the cultivation of renewable raw materials from cultivated biomass is being gradually put on the shelf, without showing sales prospects in new markets at the same time, UFOP criticized sharply.

The European agricultural policy is still obligated to combine the requirements for economically viable and sustainable agriculture with a sustainable agricultural market or climate protection policy and to maintain and further open up sales prospects in the fuel markets. In doing so, ambitious sustainability requirements have to be taken into account, which must also be applied in third countries. Against this background, UFOP eagerly awaits the submission of the German Federal Government’s Climate Protection Act with sectoral targets for greenhouse gas reduction and the agricultural strategy announced for autumn 2019.

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Potential trade‐offs of employing perennial biomass crops

Biofuels Digest - Sat, 02/02/2019 - 2:58pm

In Sweden, researchers at the Swedish University of Agricultural Sciences and several German-based universities have been working together on a study that aims to evaluate agricultural market impacts with biomass demand for food, feed, and PBC in four bioeconomy scenarios (‘Business as usual’, ‘Improved relevance of bioeconomy’, ‘Extensive transformation to a bioeconomy’, ‘Extensive transformation to a bioeconomy with diet change’) to achieve a 75% GHG reduction target in the emission trading sector of the EU until 2050.

They simulated bioeconomy scenarios in the energy system model Times‐PanEU and the agricultural sector model ESIM and conducted a sensitivity analysis considering crop yields, PBC yields, and land use options of PBC. Their results show that all bioeconomy scenarios except the one with diet change lead to increasing food prices (the average food price index increases by about 11% in the EU and 2.5−3.0% in world markets). A combination of the transformation to a bioeconomy combined with diet change towards less animal protein in the EU is the only scenario that results in only moderately increasing food prices within the EU (+3.0%) and even falling global food prices (−6.4%). In addition, crop yield improvement and cultivation of PBC on marginal land help to reduce increases in food prices, but higher land prices are inevitable because those measures have only small effects on sparing agricultural land for PBC. For a transition to a bioeconomy that acknowledges climate mitigation targets, counter‐measures for those substantial direct and indirect impacts on agricultural markets should be taken into account, according to the study authors.

 

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BiochemUSA signs MOU to develop $422.9 million biorefinery in India

Biofuels Digest - Thu, 01/31/2019 - 5:07pm

In India, local press reports that Petron Scientech Inc’s BiochemUSA has signed a memorandum of understanding with the government of Gujarat to develop a $422.9 million biorefinery that will produce ethanol, biodiesel, corn oil and animal feed using corn and biomass entirely as feedstock. One million metric tons of corn and 300,000 tons of biomass will be used annually. The zero-liquid discharge facility that will create around 2,000 jobs should be ready for commissioning in 24-30 months.

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Japan December ethanol imports fall to 58,758 cu m

Biofuels Digest - Thu, 01/31/2019 - 5:06pm

In Japan, Platts reports that ethanol imports fell to 58,758 cu m in December 2018, more than 16% lower on the year and nearly 8.5% lower than in November 2018. The entire volume imported was undenatured with 45,319 cu originating in Brazil, followed by the US with 12,255 cu m and the rest from Pakistan. Brazil supplied nearly half of Japan’s 2018 imports at 370,419 cu m from a total of 668,672 cu m, followed by the US and Pakistan.

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European farmers want the European Commission to strictly monitor Argentine biodiesel imports

Biofuels Digest - Thu, 01/31/2019 - 5:05pm

In Belgium, Copa and Cogeca welcomed EU Member States approval of Commission’s package of definitive anti-subsidy measures against Argentinian biodiesel’s imports, during Trade Defense Committee held on January 30. Nevertheless, the approval of an import quota of 1.2 million tons in the same meeting in a Price Undertaking Agreement between EU and Argentina remains a cause for concern for Copa and Cogeca.

Copa and Cogeca are seriously concerned about the quota import provided for by the Price Undertaking Agreement adopted in the package, which allows the Argentinian industry to export 1.2 million tons of biodiesel into the EU market under a minimum import price. The volumes of Argentinian biodiesel imported to the EU have skyrocketed from nothing to 1.2 million tons since September 2017. This is because the anti-dumping measures that applied since 2013 have been reduced by the Commission to a non-protective level in order to comply with a WTO ruling. This situation has been harming European rapeseed producers as well as the biodiesel industry.

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New WWF report looks at opportunities for aviation biofuel production in Africa

Biofuels Digest - Thu, 01/31/2019 - 5:04pm

In Austria, a new study, designed by IIASA researchers for conservation charity WWF, has found that while there is a small but not insignificant potential for the production of sustainable biofuels in sub-Saharan Africa, this should be prioritized for the aviation industry which has limited other options when it comes to reducing carbon emissions.

The WWF report, titled Taking off: Understanding the sustainable aviation biofuel potential in sub-Saharan Africa, looks into the current and future potential of biofuel feedstock production in sub-Saharan Africa using the strict sustainability criteria of the Roundtable on Sustainable Biomaterials (RSB) standard.

These criteria exclude any crops and biomass residue which would result in negative environmental and social impacts, such as food insecurity, unsustainable use of scarce resources like water, land, the destruction of biodiversity and insufficient reduction of greenhouse gases.

Among the key findings are:

Sub-Saharan Africa could at best contribute between 30% and 90% of long-term alternative aviation fuel demand in the form of RSB-compliant aviation biofuel produced from energy crops on approximately 84 million hectares of prime and good quality land and another 157 million hectares of moderately suitable land.

This assumption holds that all energy crops on suitable land in sub-Saharan Africa would be reserved for the exclusive production of biofuels for aviation.

The highest greenhouse gas savings are typically achieved by perennial crops. To incentivize farmers to invest in the cultivation of such crops, the aviation industry and fuel suppliers should sign long-term off-take agreements to mitigate the risks related to their production.

Annual energy crops could be planted on degraded land (such as the rehabilitation of mining land) and could replace other industrial crops in decline. An example would be replacing tobacco crops for the cigarette industry with Solaris tobacco which is a tested feedstock for biofuel.

Because shipping feedstock long distances could reduce the greenhouse gas savings, the finished product should ideally be processed locally to develop a local biofuel value chain and industry.

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Consortium launched to develop circular polymers from waste plastic

Biofuels Digest - Thu, 01/31/2019 - 5:03pm

In Saudi Arabia, SABIC announced together with its customers Unilever, Vinventions and Walki Group, the launch of certified circular polymers to be manufactured by SABIC and planned to be used by its customers for packaging solutions for a variety of consumer products that will be introduced into the market in 2019.

The certified circular polymers will be produced from a feedstock known as TACOIL – a patented product from UK-based PLASTIC ENERGY Ltd – from the recycling of low quality, mixed plastic waste otherwise destined for incineration or landfill. SABIC will process this feedstock on its production site at Geleen in The Netherlands.

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“Ethanol in India” portal launched to promote biofuels on the ground

Biofuels Digest - Thu, 01/31/2019 - 5:01pm

In India, the transport minister has launched a web portal intended to promote information about and uptake of ethanol across the country. “Ethanol in India” looks at a wide range of ethanol feedstocks from corn to sugarcane and some non-traditional crops as well to encourage farmers and project developers alike. The portal was launched in Hindi but will soon be launched in more Indian languages in an effort to reach across the country, especially in hopes of driving job creation for youth.

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University of Illinois researchers look at how to grow Miscanthus in cold climes

Biofuels Digest - Thu, 01/31/2019 - 5:00pm

In Illinois, for farmers, Miscanthus represents a big up-front investment. The large perennial grass must be established from vegetative pieces at great cost to farmers, but it promises a decade or more of massive biomass yields, starting in year two or three. If a cold winter happens to strike in the first year, however, all bets are off. The cold-sensitivity of the crop has limited its adoption in northern climes, but new research from the University of Illinois shows a way forward for would-be Miscanthus growers in cold regions.

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Washington state inching closer to boosting biodiesel use

Biofuels Digest - Thu, 01/31/2019 - 4:59pm

In Washington state, legislation currently under consideration in both the state’s House and Senate would see biodiesel used locally, rather than that produced by companies such as SeQuential and REG being shipped out of state or even to British Columbia where clean fuel standards drive demand for biodiesel. About 43% of the state’s GHG emissions come from transport, so boosting demand for biodiesel is seen as a way of significantly reducing those emissions. Proposed legislation envisages as a credit system similar to RINs.

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Transport bursts onto global decarbonisation map

Biofuels Digest - Thu, 01/31/2019 - 4:57pm

By Matthew Stone, Managing Director of PRIMA

Special to The Digest

Transport has long been recognised as the hardest part of the global economy to decarbonise. Sitting outside the remit of schemes such as the EU’s carbon Emissions Trading Scheme, the road sector has traditionally depended on biofuel mandates to reduce its carbon footprint in Europe and North America. Since these schemes were launched at meaningful levels of renewable consumption in Europe and the US more than a decade ago demand has been ratcheting steadily higher. Exponential growth in liquid renewable transport fuel solutions however is still needed to keep governments and fuel providers on track to overarching climate change commitments. To manage the explosive growth, PRIMA has created the roadmap needed for the energy, regulatory and investor stakeholders to keep on top of this huge and fast-moving sector.

While a modal shift to zero emissions vehicles remains the holy grail for many policy makers, progress is hampered by cost and technology issues. New non-liquid powertrain technologies are undoubtedly a growth area for investors, but the need for investment cash to spur the development of low carbon fuel supply chains which can plug into the existing global liquid supply infrastructure is immediate.

The EU says its transport sector needs to hit a 30% cut in its transport carbon emissions by 2030 to keep the bloc on track to meeting overarching carbon emission reduction targets. “Current trends” in the makeup of vehicle fleets, driving habits and existing carbon reduction schemes are expected to drive a 12% cut in emissions by 2030 compared to 2005. This leaves another 18% cut in emissions needed across a sector still seen as 88% reliant on fossil fuels for its mobility by 2030, with entrenched reliance on fossil fuels for mid-term mobility putting the onus on the international refining sector to respond.

Outside established “Federal” markets in the US and Europe, many more state and national governments the Americas, Asia and Africa have rolled out similar initiatives with a view to carbon emissions reduction. This has established a global demand footprint for low carbon fuels, awakening the interest of international investors looking to stimulate the development of scale solutions to the carbon emissions problem posed by transport.

Circular economy seeks multi-billion investment in waste

Increasingly sophisticated sustainability methodologies have already shifted established mandates’ onus away from relatively easy to scale crops to harder-to-understand waste streams able to compete with other zero emissions vehicle technologies such as renewably-powered batteries in terms of their minimal carbon emissions. This approach is a key component of the “circular economy” philosophy espoused by the EU. The European Commission has cemented the approach post-2020 in its recently rubber stamped RED II directive on renewable energy, which will be accompanied by a Fuel Quality Directive requiring all EU member states to document the carbon emission pathways of their transport fuel consumption to achieve a 6% headline cut in emissions by 2020.

Canada and US states meanwhile are following California’s trailblazing lead in developing a ticketing system around its transport Low Carbon Fuel System (LCFS), which incentivises the consumption of fuels based on their low carbon emissions profile, a mechanism which has sent demand for these streams skyrocketing across the US West Coast. Californian demand for low carbon transport fuel will more than double from near 10% by 2020, with Oregon and Canada close behind.

The main beneficiaries of the trend so far have been the refining firms which have already invested heavily in development waste oil supply chains and the drop-in processing technologies able to convert them into high quality fuel. Other refiners are scrambling in their wake to develop their own long-term profitable renewable fuel manufacturing businesses based around conventional refining assets. The aim is for these to deliver corporate objectives on emissions and sustainability while staking out high energy density liquid transportation fuels’ footprint against competing technologies.

Global investments announced to date suggest the global footprint for so-called renewable diesel —  a direct diesel substitute produced at refinery scale from renewable biomass feedstocks —  is set to surge. Announced projects in Europe look set to more than double capacity from 2.4mn t/yr last year to around 5.5mn t by the early 2020s. This will be dwarfed by the more than 8mn t of capacity on the drawing board in the US, compared to an established US footprint of less than 2mn t/yr at present. Asian oil firms are also looking to get in on the game, with announced plans to convert refining assets to run renewable biomass so far unquantifiable in throughput terms.

Feedstock urgently required

This armada of new fixed asset investment will need feedstock to convert into high-value, low carbon drop in fuel. The scramble is on to secure viable streams of suitable waste at scale while building the trading and origination teams to support these new business lines and manage their associated pricing and contractual risk going forward. These teams need visibility across sophisticated and opaque global supply chains and policy jurisdictions to operate effectively and profitably. Investors need the same tools to decide where to channel funds to achieve optimum carbon emissions and financial returns.

 

Now entering its third year of publication, PRIMA’s Daily Low Carbon Fuels and Feeds Report has established itself as the handbook for firms looking to navigate this new sector. Alongside its comprehensive suite of daily price points across the waste fuel and feed spectrum, PRIMA keeps the global industry updated with news and insight on the asset investments, product flows and policy changes which are steering the complex as it expands. To see PRIMA’s suite of reports on the low carbon transportation fuel markets, contact fiona.ribbins@prima-markets.com.

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QuantaVision: The Digest’s 2019 Multi-Slide Guide to Global Biofuture Solutions

Biofuels Digest - Thu, 01/31/2019 - 4:54pm

Global Biofuture Solutions have a team of global consultants that help guide legislators and regulators as they develop the policies and approaches to realize new investment in the global bioeconomy, evaluate, share and promote sustainable best practices for the entire bio-project value chain, and use the QuantaVision Risk Management System to measure, manage and mitigate the diverse risks of any given bio-project.

Cynthia Thyfault, Founder and CEO from Global Biofuture Solutions gave this illuminating overview of QuantaVision, their risk management system, the evaluation criteria, and how it can be used to manage the risks inherent in building out the global bioeconomy, and more at ABLC Global 2018 in San Francisco

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POET launches corn-oil-based asphalt alternative

Biofuels Digest - Wed, 01/30/2019 - 6:20pm

In South Dakota, POET has entered the asphalt market with its newest green alternative to fossil-fuel products. POET’s “JIVE” is a proprietary corn-oil-based product now being used by construction companies across the US to modify or rejuvenate asphalt in roads.

“This is the latest example of POET developing new technology to move our world toward true sustainability,” POET CEO Jeff Broin said. “We must learn to utilize materials harvested from the surface of the earth rather than pulling more crude oil from below. Every mile paved using JIVE and recycled materials helps save the planet and helps save taxpayer dollars.”

JIVE is being used today to make roads more resilient in both high- and low-temperature conditions. It helps roads resist cracking in cold weather and rutting during the warm season. It is also used to soften old asphalt so that it can be recycled into new roads.

“This is a lower-cost, better-performing product than the petroleum modifiers used in the past,” said Matt Reiners, Vice President of Business Development for POET Nutrition. “Companies have used JIVE over the past year to pave high-traffic highways in places like New Jersey and roads exposed to fierce elements in Utah, parts of Canada and elsewhere.”

With 164,000 miles of highway across the US and annual state and local government expenditures of $175 billion on highway construction and maintenance, the high quality, affordable and environmental alternative that JIVE provides meets a significant need. At full JIVE production, POET could improve enough roadways to circle the globe each year.

JIVE is produced as a coproduct of the biofuel process and is a lower-cost option than the traditional petroleum-based modifiers and rejuvenators. At POET plants, the patented BPX process uses enzymes instead of heat during biofuel fermentation, leading to a better slate of co-products, including JIVE.

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France looks to ethanol as solution for high fuel prices

Biofuels Digest - Wed, 01/30/2019 - 6:19pm

In France, Reuters reports that public upset over rising fuel prices has also increased demand for crop-based biofuels. Consumption of E10 in 2018 rose to 43% market share versus 39% the year prior while sales of flex-fuel conversion kits have also risen, leading to 55% more E85 sales year-on-year. Even with the huge demand increase in 2018, E85 still only represents about 2% of the national fuel market. E85 is retailing at about half the price of E10, so with the flex-fuel kit costing around $1,100, drivers can expect to get a two-year return on investment based on average fuel use.

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Study shows that low and zero-emission fuels have role to play in decarbonizing marine transport

Biofuels Digest - Wed, 01/30/2019 - 6:18pm

In the UK, Lloyd’s Register (LR) and University Maritime Advisory Services (UMAS) have released ‘Zero-Emission Vessels Transition Pathways’, a study that aims to show what is needed to enable the transition, both at the ship and supply infrastructure level, to deliver zero-emission vessels (ZEVs) that are crucial to achieve the IMO’s Greenhouse Gas (GHG) Strategy 2050 ambition. The study demonstrates to all stakeholders what action needs to be taken now.

The new ‘Zero-Emission Vessels Transition Pathways’ study seeks to address key questions about ZEVs such as: what needs to happen between now and in the next three decades for ship deployment? And what needs to happen within this period to develop the supply infrastructure?

The study looks at the key milestones, barriers and enablers over the specified timeframe, and considers cost implications, operating profile and how policy measures such as carbon pricing could influence the outcomes.

The study also said easy to store zero or low-carbon fuels (for example sustainable biofuel and methanol) may also be an attractive solution as existing infrastructure and machinery can be used to ease the transition.

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USGC sees ethanol exports reaching 4 billion gallons by 2020

Biofuels Digest - Wed, 01/30/2019 - 6:17pm

In Iowa, Successful Farming reports that the chief economist for the US Grains Council has estimated US ethanol exports could reach 4 billion gallons by 2020, more than twice the volume reached in 2017/18 of 1.62 billion gallons, already an all-time record. Last year, exports were shipped to 74 countries and this year, exports are on track to hit 2 billion gallons. Despite the trade issues between China and the US, the USGC is betting that China will become the US’s first billion gallon ethanol market.

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Argentina and EU agree price floor and volume cap for biodiesel trade

Biofuels Digest - Wed, 01/30/2019 - 6:16pm

In Argentina, Reuters reports that the European Commission has at last come to an agreement with the Argentine government that will allow biodiesel exports to resume, with prices and volume limits to be announced next month. Those producers who agree to a set minimum price won’t have to pay anti-dumping duties on their biodiesel exports to Europe. The European Biodiesel Board has welcomed the trade deal that took several months to hammer out, although details have not yet been made public.

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Scania welcomes Thailand’s push to decarbonize transport with B20

Biofuels Digest - Wed, 01/30/2019 - 6:15pm

In Thailand, as Scania prepares to open its new manufacturing hub in the country that will serve for the Asia and Oceana region, it welcomed the country’s move towards B20, saying that all of its diesel trucks can run on 100% biodiesel following a long history of working with the fuel in Europe. The country’s capital is currently suffering from extensive air pollution challenges and the government is looking at ways to improve air quality and using biodiesel is one of those solutions suggested by the Prime Minister.

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Mexican students producer gluten-free, high fiber flour from agave waste pulp

Biofuels Digest - Wed, 01/30/2019 - 6:14pm

In Mexico, students from the National Autonomous University of Mexico have developed a method to produce a gluten-free, high fiber flour from agave waste pulp. The tequila and mezcal industries produce about 2 million metric tons of the waste per year and is considered a pollutant, but the students have developed a way to make it into a functional food product. The students are currently running a crowdfunding campaign to raise the required investment to scale up production, including the use of a solar-powered dehydrator.

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Leading politician publicly mocks PM for story about biogas coming from sewage pipes

Biofuels Digest - Wed, 01/30/2019 - 6:13pm

In India, the president of the national Congress party has shown his ignorance in public by mocking the Prime Minister at rally, ridiculing the PM’s vision for biogas produced from sewage. On Biofuels Day in August 2018, the PM related a story about a tea seller who had captured gas from sewage pipes and used it to heat hot water. Social media has come down hard against the PM doubting his claims that using gas from a sewage pipe was possible.

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