1 Farming Fuel From the Land The UK Perspective: An example to follow or Avoid? Sir Ben Gill CBE MA (Cantab) Clonmel Park Hotel, Tipperary March 7 th.

1

Farming Fuel From the Land

The UK Perspective:

An example to follow or Avoid?

Sir Ben Gill CBE MA (Cantab)

Clonmel Park Hotel, Tipperary

March 7th 2007

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Looking outside the box

FINISHED FILES ARE THE RE-

SULT OF MANY YEARS OF SCIENT-

IFIC STUDY COMBINED WITH THE

EXPERIENCE OF MANY YEARS.

3

Background data: US Bioethanol

At December 31st 2006• 116 plants in production using 53 million tonnes maize p.a.• 79 plants are under construction need 51 million tonnes p.a.• 11 plants undergoing expansion: additional 8 million tonnes p.a.• Total maize demand at end of 2007; 112 million tonnes p.a.• Circa 200 plants currently at planning stage• If built at same rate as in past would create need for additional 27

million tonnes of maize by 2008• Giving potential 2008 maize demand for bioethanol of

– 139 million tonnes

– Equals 50% of current US maize production

– Equals 6% of current US oil needs

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Background data : China

• Planned objective to use 25% of oil needs from biofuels by 2020• China is now the 3rd largest importer of oil after the USA and Japan• In 2006 China imported 36.4 million tonnes of oil• 16% increase on 2005• China is currently building 40 international airports• Boeing is building a factory in China to meet the demand fro new

aeroplanes• Car congestion has become a major issue in the cities with very

subsidized public transport to persuade people away from the car• Air pollution in China has become such an issue that there are

suggestions that major factories will have to be shut down for several months before the Olympics next year to create an acceptable air standard

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China’s Changing Face

• Population growth:

– 2000 1,265,000,000

– 2005 1,306,000,000 (+41 million)

• Distribution:– Urban 562 million

– + 88 million in 5 years

– Rural 744 million

• Foreign exchange reserves now exceed $1 trillion• Boeing building a new factory specifically for the Chinese market• New car registrations + 76%• Now the largest user of mineral resources (except oil) in the

world

China assumes ever greaterInfluence in World affairs

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Background data : Davros 2007

• Esso CEO Tillerson confirmed the reality of global warming after spending $1 billion on research to disprove it

• Added that– Current carbon energy consumption (including coal) = 230 million

barrels p.d.

– Global projections to 2030 suggest a 50% increase to 345 million barrels p.d.

• Sir Nicholas Stern confirmed these figures and – We need to reduce today’s CO2 emissions by 30% to avoid a

catastrophe

– We will need to reduce 2030 CO2 figures by 80% to avoid a catastrophe

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Background data : US Budget 2008

• USDA will spend in the year 2008 $397 million on energy projects– Plus $161 million compared to 2007

– Of this $ 132 million will be for rural development renewable energy investments through guaranteed loans and grants

– The remaining $29 million will be for Research & Development to• Enhance bioenergy feedstocks• Improve conversion technologies for cellulosic ethanol

• Total USDA expenditure in 2008 will be $89 billion of which– ¾ or $67 billion will be on mandatory support programmes

• Thai expenditure is in spite of the strong oil lobby and the opposition of President Bush to climate change mitigation

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Background data : Targets

• EU Biofuels – to assume 10% of the market by 2020

– Wheat and grain consumption for biofuels to rise from• 2006: 1.9 million tonnes to• 2013 18.6 million tonnes

– Plus a strong expansion of demand for sugar beet for bioethanol

• Irish renewable fuels– 5.75% by 2009

• To save 700,000 tonnes of carbon p.a.• Or 200,000 cars

– Aim of 10% by 2020

– Renewable electricity targets introduced in 2006 should produce a saving of 2 million tonnes of CO2 by 2009

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Background data :2nd Generation Biofuels

• Research at Carnegie Mellon University on advanced technologies claims to have reduced energy production costs by 60% by

• Redesign of the distillation process using a multi column system and a steam network recovery system so reducing steam consumption

• This is claimed to reduce the cost of ethanol production from $1.61/ US gallon to $$1.43/US gallon

• OR €0.324 per litre to €0.288 per litre

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Key Drivers for change (1)

• Population growth– China– Asia– Africa

• Wealth changes– China– India & the rest of Asia– Russia– South America

• Changed Economic leaders– Demise of USA– Rise of China and India– Oil Power

Plus movement from rural Subsistence farming to

Urban dwellers

Increased demand for protein asChicken and Pigmeat increases

Demand for cereals

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US DEBT

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Key drivers for Change (2)

• Climate Change– Greenhouse Gases

• Carbon dioxide• Methane• Nitrous oxide

– Changed weather patterns• Not a uniform change over the world• Depends on the stability of the Gulf Stream• Ireland on the same line of latitude as Quebec• In general Britain and Ireland come off pretty well but• Irish Environment Protection Agency predicts that within 15 years Ireland

will suffer from summer droughts and winter floods• Worldwide water becomes the limiting factor• Rising sea levels from melting ice caps and warming seas

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Security of Supply

• Food Security– Reducing Ability to produce– Increasing demands on our land mass– Public understanding of key issues

• Farming’s Carbon Footprint– Implementation of new technologies classed as “intensification”

• Waste disposal v. use– Retailer approach to the use of processed manures

• Energy security– Peak oil production– Increasing demand– High dependence on gas from the east

• Continued risk of interruption of supply• UK at the end of the gas pipeline

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Tar Sands

• They currently represent around 2/3rds of total oil reserves found principally in– Canada: Athabasca Tar Sands 1.7 x 10¹² bbl– Venezuelan Ormoco Tar Sands 1.8 x 10¹² bbl

• Conventional oil reserves 1.75 x 10¹² bbl• Environmental Extraction Cost

– Canada they cover 140,000 Kms²– High water useage to extract– High energy cost to extract

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Oil Supplies: Past & Future

• Total oil used since 1850• Total world reserves

remaining• %oil currently available found

before 1973• Time left at current world

usage of 29 bbls per annum• Time left for US if it only uses

oil in its own oil fields• Time left for US it it takes all of

Iraq’s oil as well• Time left of whole world were

to use oil at the same rate as USA

• % world oil used by non-US-ians

• 1,000 billion barrels

• 1,000 billion barrels

• 70%

• 33 years

• 3 years

• 15 years

• 6 years

• 75% and growing

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What is Biomass?

• Corruption of the two words “Biological” and “Mass”

• Includes both animal and plant materials• Can be solid, liquid or gaseous• Technically liquid biofuels are part of biomass• Biomass is used more closely as solid biofuels

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What are the different types of biomass?

• Virgin:– Energy crops– Crop co products

• Straw• Meal co products

– Forestry material• Thinnings• Tops and branches• Roots• Aboricultural

arisings

• Reclaimed materials

• Dry Wastes

– Municipal

– Industrial

• Wet Wastes

– Sewage sludges

– Food waste

– Animal waste

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What are the Barriers to uptake:

• Ignorance of the potential• Ignorance of the availability• Ignorance of the transformation technologies

that are available• Ignorance of the economic dynamics• Ignorance of the potential carbon savings• Ignorance by some of the experts• IGNORANCE, IGNORANCE, and • IGNORANCE

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Liquid Biofuels

• How best to promote?– UK 20 p per litre excise rebate– Road Transport Fuel Obligation (RTFO) from 2008

• 5% target for 2010

– Motor Oil Tax Relief (MOTR)• Failures of proposal

• Biodiesel– Different qualities of palm oil and rape oil– Need to blend

• Bioethanol– Blending and distribution issues– Hygroscopic

• Biobutanol– Has been more costly to produce but– Many advantages

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Ethanol Costs 2006

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Ethanol costs post 2010

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Biodiesel and Diesel costs 2006

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Biodiesel and Diesel Costs 2010

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Biofuel Yields

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Biomass as a heat source

• Underpinning economics– Revenue positive– Capital cost higher

• UK Capital Grant scheme– Fixed for 5 years @ 40% additional cost for boiler

and kit– Reviewed after 4 years

• Longer term recognition of the environmental value of carbon saved from renewable heat

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Biomass & Electricity

• Current coal fired energy conversion efficiency 25% to 35%• To be replaced by:

– Similar number of gas fired OR– Larger number of CHP facilities based on biomass

• Need to overlay a map of – Heat need– Electricity need– Biomass availability

• Ireland– Expected demand growth of 2% to 3% p.a.– Potential generation shortage by 2010– 30% target for renewables by 2020

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Biomass Waste as an Energy Source

• Average American produces 1.8kgs of municipal solid waste/day• Of this 75% is biomass = 1.35kgs / day• For 1 million people this = 1,350 tonnes / day• Using the latest technologies • 1 tonne of biomass waste produces approx. 330 litres bioethanol • 1350 tonnes produce approx 445,000 litres/day or• 163 million litres per year• This is enough to fuel the transport for

– 63,000 Americans

– 390,000 French

– 2,800,000 Chinese

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Major Sources of Methane

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Global Sources of Methane

• 598 Mt CH4 emitted to atmosphere each year• 576 Mt CH4 absorbed by sinks• A reduction in emissions of only 4% would lead to stabilised

atmospheric concentrations

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Benefits of Anaerobic digestion

• Larger percentage of CH4 recovered than from other methods such as landfill (between 10% and 50% more)

• Gas yields are more regular and sustainable than land fill and usually around 65% methane

• Much reduced time for the waste to fully degrade– A few decades to a few weeks– Using waste heat to raise the temperature of the digestor to

60ºC can reduce the digestion period from 60 to 20 days• There is reduced potential contamination/ pollution from the run off• Removal of noxious odours and much lower levels of pathogens• Increased availability (and value) of the digestate as the available

Nitrogen is increased from <50% to c. 90%

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Anaerobic Digestion flow chart

Waste food

Animal slurries

Human Sewage

Food processingBye products

Anaerobic Digestors

65% Methane

Digestate

Electricity Generation

Heat forBuildings

Heat to theAnaerobic Digestor

Fertiliser ApplicationFor crop production

BiodegradableDomestic refuse

Electricity Grid

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World Wheat production, Consumption & Year End Stocks

0.0

100.0

200.0

300.0

400.0

500.0

600.0

700.0

1960

/61

1962

/63

1964

/65

1966

/67

1968

/69

1970

/71

1972

/73

1974

/75

1976

/77

1978

/79

1980

/81

1982

/83

1984

/85

1986

/87

1988

/89

1990

/91

1992

/93

1994

/95

1996

/97

1998

/99

2000

/01

2002

/03

2004

/05

2006

/07f

Production

Consumption

stocks

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World Year End Wheat Stocks asPercentage of Consumption

Stocks % of consumption

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

1960

/61

1962

/63

1964

/65

1966

/67

1968

/69

1970

/71

1972

/73

1974

/75

1976

/77

1978

/79

1980

/81

1982

/83

1984

/85

1986

/87

1988

/89

1990

/91

1992

/93

1994

/95

1996

/97

1998

/99

2000

/01

2002

/03

2004

/05

4/

2006

/07

years

% s

tock

s o

f co

nsu

mp

tio

n

Stocks %

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Comparative values

burning oil v. feed wheat

£0.00

£20.00

£40.00

£60.00

£80.00

£100.00

£120.00

£140.00

1 3 5 7 9 11 13 15 17 19 21 23 25 27 29 31 33 35

burning oil ppl

whe

at£

per

tonn

e at

15%

m

oist

ure

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Demand For Land

Increasing population Increasing wealthChina, India, Russia

Water the limiting factor

Renewable energy needs

Effects of climate change

Limitations on food production

Increasing demands for crops

THE LAND SQUEEZE

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How do we derive maximum value and efficiency from biomass?

• Find the process that extracts the maximum percentage of the intrinsic value of the product

• With the minimum of – capital investment– Efficiency losses in the transformation

• While identifying the maximum market value and

• Working together to ensure that a fair distribution of the margin throughout the chain

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Remember think Laterally

• Crops as an energy source– For transport fuels

– For electricity

– For heat

• Crops as a raw material for industry

CROPSComplex

Carbohydrates

STARCH ALCOHOLBioethanol,Biobutanol

STARCHDERIVATIVESPolylactic Acid

Secondary & Tertiary

Uses

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• A farmer buys a Mercedes of the new E-class, from Three point motors. He is annoyed about the price of the extras that are not standard equipment.

• A while later the director of Three point motors buys a cow from the same farmer for his hobby farm

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Invoice:1 cow (standard version) baseprice $ 2,400 2 colours (Black/White) extra $ 150 Leather upholstery $ 400 Milk reservoir for summer and winter use $ 100 4 Milk taps @ $12.50 each $ 50 2 Bumpers, finished in Horn @ $ 50 each $ 100 Fly swatter, semi automatic $ 50 Environmentally friendly exhaust catalyst $ 60 All terrain and weather boots $ 100Brake system 2 circuits (Legs front and rear) $ 400Multi tone horn $ 135 Eyes, HALOGEN $ 150 Multiple fuel use possibility $ 1,250 Total for cow as ordered $ 5,345

The farmer issued the following invoice: