The Burrill Report

With proper investments and policies, most biofuel technologies could become nearly cost-competitive with fossil fuels, or even be produced at lower costs in the longer term, according to a new report from The International Energy Agency.

Biofuels could represent 27 percent of all transportation fuels by 2050, compared to just 2 percent today, helping reduce CO2 emissions and boost energy security, according to the agency’s new technology roadmap.

Countries will have to spend between $11 trillion and $13 trillion on biofuels over the next 40 years to meet the roadmap targets, depending on actual production costs, the IEA calculates. While this may seem like a large figure, even in a worst case scenario, it would only increase the total costs of transportation fuels by around 1 percent over the next 40 years, and could possibly lead to cost reductions, asserts the agency.

The IEA, an autonomous organization created after the 1973 oil crisis to secure affordable and clean energy for its 28 member countries, prepared the roadmap in consultation with representatives of government, industry, academia and non-governmental organizations.

Expanding the role of biofuels is perceived in some quarters as compromising food security and providing limited environmental benefits. But the agency argues that biofuel consumption can be increased in a sustainable way and lead to significant reductions in greenhouse gas emissions.

“While vehicle efficiency will be the most important and most cost-efficient way to reduce transport-emissions, biofuels will still be needed to provide low-carbon fuel alternatives for planes, marine vessels and other heavy transport modes, and will eventually provide one-fifth of emission reductions in the transport sector,” says Bo Diczfalusy, the IEA’s director of sustainable energy policy and technology.

The IEA says commercial-scale deployment of advanced biofuels has not yet happened, and is not expected to contribute much to the fuel supply until 2020 and beyond.

“Further support for advanced biofuel research, development, and demonstration is still needed to improve conversion efficiencies and reduce costs,” says Diczfalusy. “In addition, investments in commercial-scale production units will be a key to enable advanced biofuels to reach full market maturity.”

Governments need to provide a stable, long-term policy framework for biofuels that allows for sustained investments in biofuel expansion. “Specific support measures that address the high investment risk currently associated with pre-commercial advanced biofuel technologies will be vital to trigger industry investments in first commercial plants,” he says.

To address issues of food security as the world population swells by more than 30 percent to 9 billion people in 2050, increasing demand for food and energy, the IEA report says use of crop residues and high-yielding energy crops as feedstocks, and the efficient use of biomass through integrating biorefineries will be vital to reduce land competition.

IEA figures that 3 billion tons of biomass per year will be needed to produce the biofuels target envisioned in its roadmap, which would consist of 1 billion tons of biomass residues and wastes supplemented by production from about 100 million hectares of land—around 2 percent of total agricultural land. It estimates that crop yields could increase by a factor of 10 through the use of more productive practices such as multi-season planting—rotating the planting of food and energy crops, and the improvement of crop yields.

The report stresses governments should adopt mandatory sustainability standards for biofuels aligned with international standards to avoid acting as barriers to trade. It also calls for international collaboration and the reduction of tariffs and trade barriers to expand trade in biomass and biofuels to meet emerging demand in different regions of the world.

April 29, 2011
http://www.burrillreport.com/article-making_a_case_for_biofuels.html