Europe’s Ethanol CEOs Besieged by RED II and Illusory Truths

by James Cogan (Ethanol Europe Renewables Ltd/Biofuels Digest) The CEOs of Europe’s big ethanol firms (Tereos, Cristal Union, Alco Group, Crop Energies) are under seige.

They are battling imported and sometimes fake used cooking oil, not-yet-viable advanced fuels, palm oil diesel, imports from countries which didn’t even sign the Paris Agreement and good old fossil oil relabeled as “double counted renewable”. Europe’s new RED II legislation is a smorgasbord of climate-harming substitutes for domestically sourced conventional ethanol.

But do the numbers and two things jump out: domestically sourced conventional ethanol is safe and effective, and we are going to need it for at least another thirty years. Electric vehicles won’t reach parity with combustion engines until sometime around 2050 and by that time the total fleet will have doubled in size. Conventional climate friendly ethanol allows the combustion fleet reduce its carbon footprint during those transition decades.

... (T)he world will still be burning as much liquid fuel on the road in 2050 as it is today.

Peak oil in road transport will be reached ahead of 2050, or sometime around 2035 when the electric fleet starts to make its presence felt on a large scale. Fossil carbon transport emissions will be up 25% in the period. Globally, transport activity doubled between 1970 and 2010[1] and is set to double again by 2050[2], with an average annual growth rate of 1.5%. And by the way this is a conservative estimate. It could actually be twice that as growth in world GDP in the same period is predicted to be 3%[3]. If it is twice that then oil use on the road could potentially grow as much as 80% above today’s level with peak oil in transport occuring as late as 2045.

Global sales of oil burning cars and light vehicles exceeded 90 million units in 2017[4]. This compares to around a million[5] for the electric sector, a relatively modest number though very large in comparison to the global stock of electric vehicles, which reached two million a year ago. What this means in terms of trends in greenhouse gas emissions is that for every new electric vehicle joining the world’s car fleet today there are still nearly a hundred new fossil burners taking to the roads. Sixty of the new ones are replacing end-of-life vehicles, which have a lifespan of 15-20 years, but thirty of them are actually adding to the fleet size.

The super rapid uptake of electric vehicles is an example of an illusory truth. Many citizens and governments believe that the world fleet of vehicles will be well on the way to renewable electrification in under a decade, rendering unnecessary any further support for biofuels. They ignore the many factors that make the “truth” illusory: Sales of combustion engines vehicles in absolute numbers are still growing way faster than sales of EVs; The vehicle fleet replacement rate is about 5% per year, meaning it takes 20 years for a new sales trends to become fleet-wide trends; Electricity producers are struggling to convert current supply to renewable supply, never mind servicing additional renewable demand; ....

Firstly, efforts to accelerate electric vehicle take-up should be intensified greatly. There is no such thing as too much support for electro-mobility. Secondly, the right policy frameworks should be put in place to assure safe effective solutions like conventional ethanol are available for reducing the carbon footprint of traditional liquid fueled engines in the lengthy interim.

Works in Today’s Cars Today

Ethanol can be blended at up to 100% of the fuel going into the gas tanks of conventional cars, depending on engine type and fuel standards. Virtually all petrol engine vehicles made in the world today can run on a 25% ethanol blend, either as they are or with minor changes. For each percentage point of ethanol used in petrol the carbon savings are between a half and one percent with the precise figure determined by the way the ethanol was produced and by the methodology used to calculate the savings. To take a practical example, if ethanol were to be blended at 20% in the fuel of Europe’s entire fleet of 100 million petrol vehicles the effect in terms of greenhouse gases would be the equivalent of taking 15 million of those vehicles off the road. That is a huge contribution. Europe has made a start, putting about 5% ethanol in its petrol on average to date. The USA is at 10% and Brazil at nearly 30%. China aims to reach 10% by 2020.

The consensus among transport energy analysts at the IPCC[6] is that low carbon biofuels can and must be deployed in the existing fleet for reducing the carbon intensity of internal combustion engines.

Right now conventional bioethanol is the world’s most cost effective, climate friendly and readily available form of fossil fuel substitute there is. It is helping make the transition to electro-mobility that bit more manageable.

[1] Figure 8.1 of IPCC Report ”Climate Change 2014: Mitigation of Climate Change”

[2] Figure 8.10 of IPCC Report ”Climate Change 2014: Mitigation of Climate Change”