Biofuels plant announced for Teesside
As US boffins reckon to turn industry upside down
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The UK biofuels industry is to invest £250m in a new ethanol production plant on Teesside.
Ensus, the concern building the facility, has secured the funds from private equity groups the Carlyle Group and Riverstone Holdings. There is also £150m of debt finance.
Building work is to commence this spring at the Wilton International site near Middlesbrough and full production should reach 400 million litres a year in 2009.
The UK will introduce a requirement for five per cent bio-sourced content in all transport fuel from 2010, guaranteeing a need for at least a billion litres of ethanol annually. It will also mandate a 2.5 per cent biofuel requirement to commence in 2008, which is projected to reduce overall carbon emissions by 500,000 tonnes per year.
So far, Ensus will have few on-shore rivals for this market, although British Sugar is to open a smaller 70 million litre plant.
The Ensus facility is to produce its ethanol from wheat, traditionally in surplus across the European Union. The idea is that the wheat has absorbed carbon from the atmosphere as it grows, so using it in place of fossil fuels will reduce environmental damage.
However, biofuels have occasionally run into controversy. It has been suggested that a big takeup might drive up the price of food and require excessive use of land. Some critics have also pointed out that producing ethanol requires substantial amounts of power, which at the moment is largely generated by burning fossil fuels.
Biofuel advocates have countered with the suggestion that in future the production plants and associated transport could also burn ethanol. In this scenario, fields of crops would effectively function as immense self-built solar-power generators, storing the sun's energy in portable ethanol form without any carbon footprint whatsoever.
Whether there is enough land and biomass available in the world to power the human race's transport needs and feed it too is open to question. Researchers at Purdue University in the USA say there probably isn't, using current ethanol-production methods. They reckon if the biofuels industry carries on as it is, running all American transport (cars, trains, planes, the lot) "would require a land area 25 per cent to 55 per cent the size of the United States." The USA isn't all productive land in this sense, and people need to eat too, so this might not be viable.
But the Purdue researchers reckon they've got the solution, though it may not make traditional biofuel lovers happy.
Rakesh Agrawal, Purdue's Winthrop E Stone distinguished professor of chemical engineering, says his team has found a method which can get three times as much fuel out of a given amount of biomass. This would permit the USA to power its transport from just six to 10 per cent of its own area, perhaps using stuff which at the moment is considered agricultural waste.
The catch which will have some ethanol-heads up in arms is that Agrawal's method requires the addition of hydrogen during the ethanol production process. Hydrogen is, of course, the hated rival of ethanol for green motor fuel of the future. Worse, it requires substantial amounts of electricity to be produced cleanly. Agrawal, like the normal hydrogen lobbyists, speculates that this juice would come from a carbon-free source such as solar or nuclear power.
Purdue University considers the process worth patenting, at any rate, and research such as this does suggest that the shape of biofuel infrastructure may be in flux.
Furthermore, the UK market is driven by possibly changeable legislation, and the availability of corn is dependent on controversial EU farm subsidies.
The resultant lack of certainty around biofuels may have been a factor in Ensus' decision not to list on the Aim stock market and go with private equity instead. But Ensus CEO Alwyn Hughes says not. "We see huge advantages in private equity," he told the London Financial Times. ®
COMMENTS
New ethanol studies
I must recommend two recent studies. The first is a Rutgers University Study (Eaves and Eaves 2007: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=969496&high=%20eaves#PaperDownload) that shows that ethanol can replace little automobile fuel when produced sustainably and it is inherently more unreliable compared to gasoline. The other is Hill (2006). Both studies illustrate that ethanol policy is simply a subsidy and certainly not an energy policy.
Another ludicrous proposal
So this project is based on the hypothesis that we will continue to experience grain surpluses. There's the economics of the madhouse for you.
Global grain yields aren't growing nearly as fast as they used to; we managed to triple harvests between 1950 and 1990, but since then the rate of growth has been going up much less quickly.
When you throw in recent poor harvests in the US and Australia there is a real pressure on the global grain market which is reflected in the decline in stored food around the World; it was 116 days of stores as recently as 1999, now its around 60. Because Africa (for once) had reasonable harvests in the last couple of years the decline in global food security has not been such an issue - no one is starving - yet. A few bad years and the World could be in real trouble.
The US is already reporting increased prices for feed grain which instead of going into the meat industry is being turned into ethanol. Meat production in America is expected to decline this year for that reason alone. Mexico has seen protests because the staple corn tortilla is soaring in price thanks to deluded US gasohol backers.
So what are we doing? Turning perfectly good food into petrol substitutes so that we can go on just the way we are right now.
Bioethanol and biodiesel don't make sense
Having had a go at making biodiesel and looked at the economics of America's cack handed bioethanol production, I think that current approaches to biofuels are flawed:
Brazil has a successful bioethanol industry because they grow sugar cane in a subtropical environment, it doesn't require a lot of fertilizer, and it produces a high ethanol yield because you don't have to fiddle with it to get enough sugar out to make any ethanol at all. Corn and wheat as feedstocks, by contrast are pretty poor for giving a decent amount of sugar, requiring a malting process which uses lots of water and heat, or chemical treatment with substances derived from petrochemicals. To distill ethanol to sufficient purity to be a fuel requires vast amounts of heat. In sum, I think that the total energy return from the manufacture of bioethanol is close to zero.
Biodiesel is slightly better, in that getting vegetable oil out of feedstock can be done by cold pressing or with minimal heat. However the biodiesel process requires heat to be applied for some considerable time, and the use of caustic substances such as sodium hydroxide (caustic soda in the UK, lye in the US) to catalyze the process, and an alcohol such as methanol (produced from petrochemicals) or ethanol (see ethanol issues above) , to make it.
Converting a diesel vehicle to run on pure vegetable oil in the UK using a kit currently costs around £3000, but to build diesel engines from scratch to run on vegetable oil would probably add negligible cost to the price of a diesel engine, which was after all originally developed to run on vegetable oil. Vegetable oil, out of the above three options (bio ethanol, bio diesel, veg oil) requires the least energy and the least chemicals to produce. However, veg oil is also a foodstuff, which means that government would find it hard to centralize and hard to tax, and there are no tax breaks for veg oil as a fuel, so nobody is going to bother to build a plant to produce it.
If either UK party really believed in greening the fuel supply, they'd probably be pushing straight veg oil.
There is also research currently on oil producing algae, which would solve the problem of finding enough land to grow enough oil crops to provide fuel as well as food on a large scale, because it could be grown on the sea.
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