This data-file provides an overview of the 3.5Mbpd global biofuels industry, across its main components: corn ethanol, sugarcane ethanol, vegetable oils, palm oil, waste oils (renewable diesel), cellulosic biomass, algal biofuels, biogas and landfill gas.
For each biofuel technology, we describe the production process, advantages and drawbacks; plus we quantify the market size, typical costs, CO2 intensities and yields per acre.
While biofuels can be lower carbon than fossil fuels, they are not zero-carbon, hence continued progress is needed to improve both their economics and their process-efficiencies.
Our long-term estimate is that the total biofuels market could reach 20Mboed (chart below), however this would require another 100M of land and oil prices would need to rise to $125/bbl to justify this switch.
The data-file also contains an overview of sustainable aviation fuels, summarizing the opportunity set, then estimating the costs and CO2 intensities of different options.
Greater decarbonization at a lower cost is achievable by burying biomass (such as corn or sugarcane) rather than converting it into bio-ethanol.
This model captures the economics. Detailed costs are estimated for biomass burial and to compare the relative CO2 footprints of the two options.
Three individual tabs illustrate margins, NPVs and IRRs for sugar-cane to bio-ethanol economics, buried sugarcane, and buried napier grass.
This data-file tabulates the CO2 emissions from US ethanol plants, which produce around 1Mbpd of liquid fuels, giving an average CO2 intensity of ethanol of 85kg/boe.
In addition, we estimate 75kg/boe is emitted in producing corn, and around 2 boe of corn are needed to make 1 boe of ethanol.
Thus bio-ethanol has a total CO2 intensity of 240kg/boe (this is c40-50% less than conventional oil products, on a fully-loaded Scope 1-3 basis).
Our data are based on granular disclosures from 170 separate facilities, which have reported to the EPA FLIGHT tool and to the EIA.
Hence we can use the data to screen for the CO2 intensity of ethanol production state by state and company by company.
Covered companies, ranked by ethanol capacity, include Poet, Valero, Great Plains, Koch, Marathon and White Energy.
CO2 intensity below 60kg/boe can be considered as ‘lower carbon’ while CO2 intensity above 90kg/boe would be considered ‘higher carbon’.
The data-file also breaks down 170 different ethanol production facilities in the US, facility-by-facility. There is c300kbpd in Iowa, and over 100kbpd in boh Illinois and Iowa.
The industry-leading ethanol producer is highlighted and discussed in this article that was sent out to our distribution list.
This data-file tracks 5,000 patents filed into biofuels: by geography, by company and particularly in 2017-20. The pace of research activity into “biofuels” and “biodiesel” seems to have halved since 2014, suggesting industry interest is waning.
As usual, China has come to dominate the recent patent literature, accounting for 60% of recent filings. Out of the ‘Top 25’ patents filed into biofuels from 2017-20, 15 are Chinese companies.
Ranked by recent patent filings, technology leaders include Sinopec, BASF, Arkema, Neste, TOTAL, ExxonMobil and DuPont. It is interesting that some well known companies (e.g., Ryze) did not appear to have filed many patents recently. Full details on the patent trends and filings are in the data-file.
Our 3 key conclusions are spelled out in the green diesel article sent out to our distribution list.
This short model compares different options for decarbonising diesel, either by substituting it with renewable diesel, or by offsetting its CO2 with carbon credits from reforestation.
We conclude that offsetting the CO2 of diesel fuel could cost 60-90% less than purchasing advanced biofuel, at current pricing. Economically justified premia for biofuels are calculated.
Please download the model to interrogate numbers and run your own scenarios. For more information on our input assumptions, please see our biofuels overview data-file.