Bio-coke: energy economics?

Bio-coke energy economics

Bio-coke is source of carbon and energy for steel-making, and other smelting operations where metal oxides need to be reduced to pure metals.

Bio-coke differs from conventional coal-coke or petcoke in that it is derived from biomass, ideally waste biomass, which would otherwise have decomposed. This lowers emissions.

Specifically, input materials are treated at high temperatures and pressure (sometimes around 1,000ºC) to drive off non-carbon materials as gases and ashes.

Bio-coke energy economics. Costs of bio-coke production will most likely run at $450/ton, in order to earn a 10% IRR on a greenfield facility, per the calculations in this model. This is c50% more than the typical price of $300/ton for coal-coke, in normal times. But the higher cost may be economically justified…

Total CO2 intensity of producing bio-coke is calculated at 1 – 1.5 tons/ton, as quantified from technical papers and our own estimates in this data-file. Hence it would save around 2 – 3 tons/ton of CO2 compared with coal-coke. CO2 abatement costs are therefore implied to run at $70/ton, which is competitive on our roadmap to net zero.

However, bio-cokes are not directly comparable with coal cokes. For example, bio-cokes might have an energy density above 5,000 kWh/ton and “fixed carbon” of 25-85%, a broad range depending on processing parameters. By contrast, traditional coke is closer to 7,000-8,000 kWh/ton, and always above 80% carbon. In addition, bio-cokes can be 50-75% softer and more reactive in some furnace designs than traditional coke. This requires plant modifications, additives and binders, which are still being de-risked.

There are also challenges for scaling. Near-term bio-coke production facilities are likely operating with scales of tens of kTpa. One of the larger operations today, situated in Brazil, makes 600kTpa of ‘zero carbon’ steel, which itself requires 50,000 hectares of planted eucalyptus. However, the total global steel industry produces 2GTpa of output, and replacing all of its coal and coke with biomass could require 2GTpa of biomass inputs, equivalent to the world’s total global timber harvest.

Overall, we conclude that there are good opportunities for bio-coke to contribute to decarbonization of metals and materials, as one out of many concurrent opportunities. Although we might still prefer adjacent opportunities in biochar. You can stress test broad-ranging input variables for bio-coke energy economics in this model.

World food production: energy breakdown by crop by country?

World food energy by crop

This-data file is a breakdown of world food energy production, by crop, and by major country-region. The source is the excellent and open-source data from the Food and Agriculture Organization. But more importantly, from our perspective as energy analysts, we have converted the numbers from tons to calories and TWH of primary energy equivalents.

World food output is 10bn tons per year, in tonnage terms, of which around 1GTpa comprises corn, vegetables, sugar products, milk, wheat, fruits and rice; while smaller categories include 360MTpa of potatoes, 360MTpa of meats, 350MTpa of soybeans and 250MTpa of vegetable oils (which are also broken down by component and region in the data-file).

Energy density varies sharply, however. 1 kg of vegetable oil might contain 10kWh/kg of energy, while this declines to 5kWh/kg for sugars, 3-4kWh/kg for cereal crops, 2kWh/kg for meats and 0.5kWh/kg for fruits and vegetables.

Food energy production, therefore, stands at 20 trn calories per year, equivalent to 25,000 TWH of primary energy. For perspective, the primary energy in total global gas production is around 40,000 TWH, in total global coal it is 40,000 TWH and in total global oil production it is 50,000 TWH. Food from the world’s 4bn acres of cropland is no less an energy source than conventional energy.

Global food consumption (by humans) only runs at 30% of total food production, or 2,500 calories per person per year, according to our bridging overleaf. c30% of total food production is wasted. Another c30% is fed to animals, which must consume an average of 8 calories to produce 1 calorie of meat. Another c5% is converted into energy as a biofuel. And another c2% is used in consumer products.

Food shortages are an increasing fear for 2022-25. The data also show a wide spread by country-region. Brazil produces 4x its own calorific needs. The US produces 3x. Europe produces 1.1x. But emerging Asia is only 0.7x. Africa is only 0.5x. Alleviating food shortages may result in changing biofuels strategies from developed world (note here) and changing consumption habits (note here).

The data-file contains all of the numbers behind the ideas above, plus a ‘cleaned’ and useful reference, as a breakdown of world food energy production by crop by country and region. For running mass balances, energy balances or biofuels considerations around the world food system.

To read more about world food energy production, please see our article here.

Palm oil: what CO2 intensity?

CO2 intensity of palm oil

Global palm oil production is running at 80MTpa in 2022, for use in food products, HPC products and bio-fuels. CO2 intensity of palm oil is assessed in this short note and data-file.

Palm oil is controversial, as it is linked to destruction of virgin rainforests, c40% of recent production has been associated with deforestation and c20% has been associated with peatland degradation.

The purpose of this data-file is to estimate the CO2 intensity of palm oil production, in tons of CO2e per ton of crude palm oil. We have aggregated data from 12 technical papers, and also constructed our own bottom up estimates.

Excluding land use impacts, we think palm oil production most likely has a CO2 intensity of 1.2 tons per ton, which is also an OK baseline estimate for responsible palm oil producers.

On a global average basis, including land use changes, we think CO2 intensity is around 8 tons per ton, assuming 40% of the land was deforested and 20% peat-degraded. The worst case scenario is a CO2 intensity of 20 tons/ton.

All of this matters for biofuels. Biodiesel sourced from the world’s average palm oil (8 tons/ton) is going to have 2.5x more emissions than burning conventional diesel. Likewise, if renewable diesel is produced from 65% used cooking oil, 35% palm oil, then again, it will have a higher CO2 impact than conventional diesel (model here).

To read more, please see our article here.  Our main conclusion is that bio- and renewable diesel expansion plans may be stymied by tighter feedstock constraints and regulations (note here).

Biofuels: the best of times, the worst of times?

Outlook for biofuels in energy transition

How will food and energy shortages re-shape liquid biofuels? This 11-page note explores four questions. Could the US re-consider its ethanol blending to help world food security? Could rising cash costs of bio-diesel inflate global diesel prices to $6-8/gal? Will renewable diesel expansion ambitions be dialed back? What outlook for each liquid biofuel in the energy transition?

Wood use: what CO2 credentials?

CO2 intensity in wood

The carbon credentials of wood are not black-and-white. They depend on context. This 13-page note draws out the numbers and five key conclusions. They count against deforestation, in favor of using waste wood, in favor of wood materials (with some debate around paper) and strongly in favor of natural gas.

Landfill gas: rags to riches?

Methane emissions from landfills account for 2% of global CO2e. c70% of these emissions could easily be abated for c$5/ton, simply by capturing and flaring the methane. Going further, low cost uses of landfill gas in heat and power can also make good sense. But vast subsidies for landfill gas upgrading, RNG vehicles and biogas-to-jet may not be cost-effective.

Landfill gas: the economics?

The purpose of this data-file is to model the typical costs of producing raw landfill gas (a mixture of CH4, CO2 and other impurities) at a solid waste landfilling facility.

Our capex and opex cost build-ups are derived from EPA guidance and our gas evolution equations are derived from a line-by-line breakdown of landfill products (below). Note this is prior to gas cleaning and upgrading.

We estimate that a typical landfill facility may be able to capture and abate 70% of its methane leaks for a CO2-equivalent cost of $5/ton. Other landfill gas pathways get more complex and expensive.

Danimer: bio-plastics breakthrough?

Danimer Scientific is a producer of polyhydroxyalkanoates (PHA), a biodegradable plastic feedstock, sold under the brand-name Nodax, derived from the bacterial metabolism of vegetable oils (e.g. canola oil).

There are still commercial challenges and uncertainties preventing a full de-risking of PHA bio-plastics. They include slow processing (especially long crystallization times), lower tensile strength, higher brittleness and 4-5x higher costs than conventional plastics (screen here).

Nevertheless Danimer scores a solid 3.5/5 on our technology framework. Our review of its recent patents shows specific and reasonably intelligible innovations, which are especially focused upon improved processing, high-quality copolymers and boosting demand for PHA products.

Our conclusions and underlying details are laid out in the data-file.

LanzaTech: biofuels breakthrough?

LanzaTech aspires to “take waste carbon emissions and convert them” into sustainable fuels (and bio-plastics) with a >70% CO2 reduction.

It has produced small volumes in China since 2017, partnered with Shell and BA, and is now progressing larger projects: a €150M exhaust-gas capture for AccelorMittal’s Ghent steel plant, and a 10MGal/year aviation fuel facility in Georgia.

We have assessed its patents but concluded we cannot yet de-risk the CO2-to-fuels pathway in our energy transition models. This short note outlines how we believe its technology works, and what hurdles could helpfully be cleared.

Origin Materials: bio-plastics breakthrough?

Origin Materials went public via SPAC in February-2021, as it was acquired by Artius Acquisition Inc at a valuation of $1.8bn. $200M is also secured from Danone, Nestle and PepsiCo, building on a packaging material (PET) partnership that goes back to 2016.

Its ambition is to use wood residues to create carbon-negative plastics, cost-competitively with petroleum products and capture a “$1trn market opportunity”.

Our patent analysis shows Origin has visibly been focused on 5-chloro-methyl furfural as a building block.  For example, CMF can be reduced to MF (loss of chlorine), further reduced to DMF (loss of OH) and then combined with ethylene to yield pX.

Hundreds of potential catalysts, solvents and conditions are suggested for each reaction in the patents.  This data-file outlines our understanding of Origin’s innovations and the key challenges for commerciality.

Copyright: Thunder Said Energy, 2022.