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May 26, 2015

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by Jim Lane (Biofuels Digest) ... How does the European renewable fuels industry look at itself? Too focused on survival instead of growth? Too focused on sector competition instead of the transparency on carbon that leads to policy stability? Not focused enough on presenting solid, positive evidence that the industry delivers on carbon?

At the World Bioenergy Leadership Forum in Seville, five leaders look at progress, barriers and response, opportunity, and adaptations in the face of changing oil prices and changing views on biofuels and carbon.

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Eric Sievers, CEO, Ethanol Europe

... "We’re the 5th largest company in the EU and I don’t know the CEO of the 1st, 2nd, 3rd or 4th; I never see them at an ePure meeting. It’s cheap to complain, but these were entirely avoidable situations, and we won’t have a strong industry unless we put resources behind it.

If you look at our path forward in the EU there’s no assurance of growth or same amount of production. If we are an industry that isn’t investing, we’re just a zombie. At Ethanol Europe, we’re bringing 200 million liters online this year – and since 2009 every single liter of growth in Europe has been from our company. We are an industry that hasn’t invested in a decade.

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In terms of our investment in next-gen biofuels, which is what everyone wants, I can assure you that all of ours is going straight to California and none into the EU.

Keep it in the ground, that’s the guardians phrase for petroleum. That what we can use to unite all the first and second generation. It’s so simple and so attractive, a couple of us said we wouldn’t give a talk in the next year we without mentioning that."

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Carlo Hamelinck, Managing Consultant, Ecofys

Greenhouse gas emissions are the single most important reason for biofuels. Yes, there are broader sustainability concerns and other aspects such as energy security and jobs, but GHG performance is the reason for existence. There’s a big misunderstanding by industry. It could be very good news I suspect if we were willing to be transparent, because direct emissions from biofuels are going down and with fossil fuels they are going nowhere but up because the new oil is increasingly more difficult.

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When it comes to oil, I remember a meeting a few years back and the oil guys were saying, we all know its unsustainable, so it’s not our product we have to measure, it’s your product we have to measure.

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You see, we talk about ethanol as a commodity but in fact it is a public product which produces a public benefit.

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Policymakers talk about 5-7%, but what we should be talking about is how much fossil fuel we allow and that should be reduced to zero.

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Thomas Gameson, VP of Institutional Affairs Europe, Abengoa Bioenergy

... How did we lose our grip on the story? We have so many positive positive stories to tell, why not tell them instead internalizing the very messages of the enemies?

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You have to promote the industry and don’t say anything bad about anyone, focus on what you give to society and greenhouse gas savings and so on.

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Yuan-Sheng Yu, Lux Research

... We looked at 98 companies that would go on record with a production cost, and most are at or below for spot prices for crude, but broadly we have see three strategies emerge.

Feedstock diversification – companies like Neste; Market flexibility – like Amyris; and Capital light – like Edeniq.

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Jo Howes, E4Tech

The key is to address the concerns, because in the EU the debate begins with a question, usually, such as “why do we need biofuels at all?”

To what extent should we decarbonize the RU transport sector now, the argument goes — rather, maybe we can do things after 2030, or do electrics and other areas now.

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We think that the debate right now ignores real factors about transitions – the time you need to make changes, rollout of change, time for new specs, and the time to build new biofuel plants.

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What we see is that biofuels are needed in EU transport because even with a significant decrease in road transport liquid fuels will contribute 93% of transport needs. Efficiency gains and electrification are important but liquid fuel dependency persists, and liquids are needed for shipping and aviation.

So, then the question becomes, “how much could biofuels contribute?” We think that by 2020 biofuels could contribute 12-15% of road transport fuel energy. Looking at four scenarios, we have formed realistic expectations by 2030, on how fast can vehicles roll out, infrastructure, plant build rates, feedstock barriers and we see a 20% share from advanced biofuels.

What is needed? A stable transport energy policy, and coordinated vehicle and fuel developments, ensuring and demonstrating sustainability. Financing can be useful for a couple of plants, but it won’t get us there, we need self-sustaining businesses. But we do need to start thinking about and working towards E20 tolerant vehicles now, and we need more good news story lines to give quantified impacts. READ MORE

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H He Reema May 28, 2015 13:30

The issue in Europe is different to the USA and Canada. In the USA and Canada they have subsidies coming out of their ears and for no reason whatsoever. In Europe that is not so.

The feed stock for making renewable fuels in Europe - and we hear the comments made by Enerkem is always going to be at a cost to purchase. We know this as the use of Food Waste is now being quoted as being a commodity for purchase and t €50-00 per tonne and that is to make methane through anaerobic digestion. The companies using this material have made so much money from this that the municipal waste collection organisations are now correctly fighting back to stop being used as the pay boys for the money-chasers. The same is also true for the use of the remaining organic part of municipal waste as it is also being charged out at €40-00 per tonne because the quantity and commercial outputs of mnaking the renewable fuels (whether they are methane or ethanol) are so lucrative that the waste authorities are at last realising that they are being taken for a roide.

They see the manufacturing costs of ethanol (as an example) being barely €urocents 16 per litre when the whole-sale market is showing the sale price at €-cents 60 per litre that they can see no reason why they should subsidise these companies. We already know of one Company that has made a proposal to buy municipal solid waste from Scotland Wales and across England from Yorkshire down to London and they have declared that this is the way forward and have stated that this purchase fee could be almost £35-00 per tonne. And why not indeed?

The waste industry is a money maker and it is at last realised to be so.

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