Cost of Biofuels No Longer Sky High

by Peter Hannam (The Age) Whether it's the use of organisms first found in the guts of rabbits in New Zealand or converting the mountains of rubbish disposed of by Londoners, airlines around the world are hunting for ways to power their planes without using fossil fuels.

In Australia, the focus has been on more prosaic biofuel feedstock, such as sugarcane, or experimental crops such as the oilseed-bearing pongamia tree and emerging sources such as microalgae.

Airlines, such as Qantas and Virgin Australia, aim to source 5 per cent of their aviation fuel from sustainable biofuels by 2020.

The release on Wednesday of the results of a three-year study led by the University of Queensland reveal the nascent biofuels sector has the potential to become competitive with jet fuel sourced from oil – but only if targeted investments are made.

The research, published in the journal Biofuels, Bioproducts and Biorefining, found that using current proven technologies, the oil price would have to almost triple to be competitive with sugarcane, at $301 per barrel.

Focusing research on developing higher fermentation yields in the sucrose processing, however, could lower the viability benchmark for sugarcane to $168 a barrel. While more expensive than current oil prices of about $100-110 a barrel, the cost is no longer as stratospheric, especially if the potential for future global carbon prices are added to the equation.

Pongamia seeds, which can have a content of 40 per cent oil, would need a crude oil price of $374 per barrel to be competitive. This sources has the potential to drop to $255 if seed-oil content can increased, the study found.

Microalgae remains a long shot, needing a $1343 per barrel oil price to be competitive, although improved harvesting processes could reduce that by more than two-thirds, to $385 per barrel, the study found. READ MORE and MORE (The Australian) Abstract