transcript
- Slide 1
- Strategic Directions in Socio-economic Issues August 14, 2015
Paul Willems, TVP Energy Biosciences EBI Associate Director
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- 2 Outline Socio economics in EBI Big picture energy context
& where do biofuels fit in Going after climate change Energy
efficiency Electricity Transport The case for biofuels Policy
Biomass availability Land availability Economics Land use
Agricultural Intensification
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- 3 EBI socio-economics agenda Be the trusted source for science
underpinning policy Not involved in any lobbying We provide data,
policy analysis and tools for policy implementation Open to
collaboration with other institutions with similar values Enable
biofuels done well and avoid repeat of GMO introduction Thinking
ahead about tomorrows issues Funded by BP, but not an agent of
BP
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- 4 Oil supply and cost curve Availability of oil resources as a
function of economic price Source: IEA (2005)
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- 5 Source: UN and DOE EIA Energy use grows with economic
development US Australia Russia Brazil China India S. Korea Mexico
Ireland Greece France UK Japan Malaysia energy demand and GDP per
capita (1980-2002)
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- 6 Source: IEA WEO 2004 Global Energy Demand Growth by Sector
(1971-2030) Energy Demand (bnboe) Rapid Demand Growth Across All
Sectors Key:- industry- transport- power- buildings
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- 7 * - excludes traditional biomass Source: IEA 2004 2002 2030
Fuels Mix Projected to Remain Similar Key: - oil- coal - gas-
nuclear- hydro - modern renewables Global Primary Energy Supply by
Fuel*:
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- 8 Source : IPCC 4 report, 2007
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- 9 Primary EnergyConversion TechnologyProducts Reforming Coal
Natural Gas Biomass Extra Heavy Oil Syngas Conversion - FT -
Oxygenates - Chemicals Gasification Enzymatic/Biological Conversion
Power Generation Electricity Fuels Chemicals Refining Processes -
coking - hydro-treating - novel thermal processes CO 2 Capture CO 2
for EOR/Storage the fungibility of carbon
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- 10 Energy efficiency opportunities US example
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- 11 Lower Carbon electricity via natural gas
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- 12 US natural gas resources & production
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- 13 Vehicle pathways (US$)
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- 14 Vehicle pathways with biofuels (US$)
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- 15 Enthusiasm for biofuels 1. 23% of gasoline pool 2. By energy
content not volume Source: IEA, EU Policy, USDOE, BP Biofuels and
BCG team analysis Ability to address multiple policy objectives
Relative ease of introducing liquid fuels at scale into existing
fuel pool / infrastructure / vehicles Technology solutions to
support sustainable growth US 2007 Energy Independence and Security
Act Gasoline blend target of 36B 1 gal by 2022 (21B gal produced
from LC feedstock) Blenders subsidized by 51 cpg Farmers protected
by 54 cpg import tariff Agricultur al Support Energy Security GHG
Reductions 1970: Petrobras tasked to diversify energy sources Tax
incentives to encourage investment Deregulated in 1990s Industry
now self sufficient Brazil The Biofuels Directive 2003 Biofuel
blend target of 5.75% 2 by 2010 2007 New blend target of 10% 2
Blenders subsidized by ~160 cpg Farmers protected by ~60 cpg import
tariff Climate change 130 g/km CO2 reduction by 2012 95 g/km by
2020 EU
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- 16 Significant growth potential Volume blpa announced
regulation World biofuel penetration consensus range 19% 11%
Penetration of gasoline & diesel demand in 2030
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- 17 Actual penetration will depend on a range of factors
BioethanolBiodiesel Economic Supply Demand Constraint type
Economics of ethanol vs. gasoline Economics of ethanol under
different carbon prices Timing of LC commercialisation, and
production cost of LC versus conventional ethanol Vehicle fleet
ability to absorb ethanol Ability to get past E10 FFV growth
Mandated demand levels as floor Debate on food vs. fuel,
sustainability Ability of market to grow engineering capacity,
production capacity, infrastructure, logistics, distribution Trade
flow restrictions (tariffs, quotas) Timing of LC commercialisation
Debate on food vs. fuel, sustainability Economics of biodiesel vs.
ethanol Economics of biodiesel vs. diesel/oil price Potential
technological breakthrough in biodiesel production Vegetable oil
supply limitations Mandate levels in key markets Vehicle fleet
ability to absorb biodiesel
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- 18 A spectrum of possibilities Biofuels done well Biofuels done
badly Feedstocks corn, sugar cane, energy grasses Process
optimization pretreatment, conversion, renewable fuel use
Greenhouse gas balance well-to-wheel emissions Agricultural
practices intensity, fertilizers, water use, social impacts etc
Economic competitiveness versus gasoline, diesel, with/without
subsidies Fuel quality Performance in engines, energy density
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- Land
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- 20 Global Land Use AMBIO 23,198 (Total Land surface 13,000 M
Ha) Forest & Savannah Cereal 4.6% Pasture & Range 23.7%
30.5% Other crops 6.9% Nonarable 34.4% Courtesy of Chris
Somerville
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- 21 US Agricultural land use has declined
http://www.ers.usda.gov/briefing/Baseline/crops.htm
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- 22 A Billion acres of agricultural land has been abandoned
globally
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- 23 Some biomass species can be grown on saline land, not
suitable for agriculture RegionArea (10 6 ha) Africa69.5 Near/
Middle East53.1 Asia and Far East19.5 Latin America59.4
Australia84.7 North America16.0 Europe20.7 Spartina growing in salt
water (yield ~ 22 tons/ha) Saline soils (FAO)
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- 24 Land Use How much land is available, given the changing
definition of crops? How do we achieve proper land management
policies globally? All human activity has land use implications.
How do we understand biofuels in the proper context? Is the concept
of indirect land use changes a useful policy instrument?
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- Biomass
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- 26 US Biomass inventory = 1.3 billion tons Forest 12.8% Urban
waste 2.9% Manure 4.1% Grains 5.2% Crop residues 7.6% Soy 6.2%
Wheat straw 6.1% Corn stover 19.9% Perennial crops 35.2% From:
Billion ton Vision, DOE & USDA 2005 26 B gals ~
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- 27 Crop yields have been strongly increased but biomass yields
have not Source: European Forest Institute (www.efi.fi) Indiana
Agricultural Statistics Service Average European forest
yieldAverage Indiana corn yield
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- 28 Global grain production with and without yield enhancements
Data from worldwatch 19641974198419942004 Year 0 500 1000 1500 2000
Million Hectares
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- 29 Future crops expand notion of arable land
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- 30 High yield decreases transportation and land costs Richard
Hamilton, Ceres 500,000 gal/day scenario
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- Food and Fuel
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- 32 Will long-term food price trend reverse? D. Dijk, Rabobank
(2007)
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- 33 Developing economies want feed & food
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- 34 Global soybean imports
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- 35 Agricultural intensification How much yield improvement can
be achieved over time in both agriculture and livestock operations
through application of modern technology? How much yield
improvement could be achieved if we could simply apply existing
technology to all applicable acres worldwide? What are the
environmental implications of crop and livestock intensification
from a soil, water, air, habitat and biodiversity perspective? What
are the right government policies to promote both agricultural
productivity and environmental quality?