1. Biofuels Development Status and Potentials in Major Countries Michael Wang Center for Transportation Research Argonne National Laboratory Oct. 10, 2006

2. 2 A Complete, Robust Way Of Evaluating A Fuel’s Effects Is To Compare the Fuel With Those To Be Displaced

3. 3 Accurate Ethanol Energy Analysis Must Account for Increased Productivity in Farming Over Time Based on historical USDA data; results are 3-year moving averages 0.30 0.35 0.40 0.45 0.50 0.55 0.60 0.65 196519701975198019851990199520002005 Bushels/lb. Fertilizer ? Precision farming, etc.? U.S. Corn Output Per Pound of Fertilizer Has Risen by 70% in The Past 35 Years

4. 4 Improved Technology Has Reduced Energy Use and Operating Costs in Corn Ethanol Plants From Argonne’s discussions with ethanol plant designers, USDA data, and other reported data

5. 5 The Type of Energy, As Well As the Amount of Energy, Is important in Addressing Energy Effects of Ethanol Fossil Btu = 1.23 Btu required for 1 Btu available at fuel pump Energy in the Fuel Fossil Btu = 0.74 Petroleum Btu = 1.1 Petroleum Btu = 0.1 Fossil Btu < 0.1 Petroleum Btu = 0.1

6. 6 Most Recent Studies Show Positive Net Energy Balance for Corn Ethanol Wang GREET w/Pimentel Assumptions Energy balance here is defined as Btu content a gallon of ethanol minus fossil energy used to produce a gallon of ethanol

7. 7 Though Electricity Requires a Large Amount of Fossil Energy Input, There Is No Substitute Coal Mining Coal Transportation NG Processing NG Transmission NG Recovery Coal NG Diesel Fuel Electricity NG Diesel Fuel NG Electricity LPG, NGLs NG Electricity Electricity Generation Electricity Transmission and Distribution (8% loss) 1 mm Btu of Electricity at Wall Outlets Uranium Ore Recovery Petroleum Recovery Uranium Petroleum Uranium Ore Transportation Petroleum Transportation Other Petroleum Products Residual Oil Electricity Diesel Fuel NG Uranium Enrichment Petroleum Refinery Electricity Refinery Gas Coal NG Uranium Fuel Transportation Residual Oil Transportation Diesel Fuel Residual Oil Electricity NG Diesel Fuel Electricity NG U.S. Electricity Generation: 2.34 mm Btu Fossil Energy Input

8. 8 Energy in Different Fuels Can Have Very Different Qualities Increase in Energy Quality Fossil Energy Ratio (FER) = energy in fuel / fossil energy input 10.31

9. 9 The Role of Biofuels Is Affected by Land Availability and Oil Use in Individual Countries CountryLand Area,10 3 km 2 Population, Million Arable Land, 10 3 km 2 Arable Land km 2 per 10 3 people Oil Use, mil. barrels a day USA9,1612961,7525.9220.0 China9,3261,3061,4361.106.3 Japan374127460.365.6 Germany349821181.442.7 India2,9731,0801,6171.502.3 Canada9,0933245114.092.2 Brazil8,4571865883.162.1 France545601833.052.1 The U.K.24160570.951.7 Spain499401303.251.5 Thailand511651502.310.9 Australia7,6172049924.950.8 Pakistan7781622161.330.4 Sweden4109273.000.4

10. 10 Intermediate Products Can Be Produced from Various Feedstocks via Various Technologies

11. 11 Bio-Fuels Can Be Produced from Intermediate Products with Various Technologies

12. 12 Feedstocks for Biofuel Production Vary Among Countries Grain starch to ethanol –Corn in U.S., China, Canada –Wheat in Europe, Australia, and Canada Sugar crops to ethanol –Sugarcane in Brazil, India, and Thailand –Sugar beets in Europe Cellulosic biomass to ethanol –Managed biomass such as trees and grass –Crop residues such as corn stover, wheat straw, rice straw, sugarcane bagasse –Forest wastes –Municipal solid waste Oilseed crops to biodiesel –Soybeans in U.S. –Rapeseeds in Europe –Palm oil and other tropical oilseed crops in tropical countries –Waste cooking oil –Animal fats

13. 13 Low-level blends of ethanol/gasoline can be used in gasoline vehicles without vehicle modifications –E5 in Canada and Australia –E3 in Japan –E6-E10 in U.S. –E10 in China and Thailand –E25 in Brazil Low-level and high-level blends of biodiesel/diesel can be used in diesel vehicles without vehicle modifications –B2-B20 in different countries –B100 could be used Flexible-fuel vehicles (FFVs) for E0-E85 require vehicle modifications Liquid Biofuels Can Be Used in Vehicles at Low- or High-Level Blends

14. 14 U.S. Corn Ethanol: No.1 Ethanol Consumption Country with 4.2 billion gallons in 2005

15. 15 U.S. Fuel Ethanol Production Has Experienced Large Increases, and the Trend Will Continue Source: Renewable Fuels Association Actual Use 2005 Energy Bill requirement

16. 16 A Large Number of E85 FFVs Are in U.S. Fleet –Obtain fuel economy credits since 1993 –>5 million cars and trucks in use in 2005 –But they are powered virtually with gasoline

17. 17 General Motors Corporation’s E85 FFV Vehicle Production for U.S. Approx. 1,500,000 E85 FFV Trucks produced through 2005 MY Approx. 1,500,000 E85 FFV Trucks produced through 2005 MY Forecast Production

18. 18 Brazilian Sugarcane Ethanol: No.2 Ethanol Consumption Country with ~4 Billion Gallons in 2005

19. 19 Brazil Is the Largest Sugarcane Producing Country Humid equatorial Dry winter/humid summer tropical Semi-arid tropical Humid coastal Humid subtropical

20. 20 Production costs in Brazil reached 100 US$/ton in 2005 Sugar Production Cost Estimated Cost (US$/Ton in Dec/00) Sugar Cane Production (Mt) 2002 22,75,42, 6 19,02,36,65, 1 7,310,31,5 0, 9 100 From Rainach (2006) Brazil Has the Lowest Production Cost for Sugar

21. 21 Brazil’s Low Sugar Production Cost Is Due to a Combination of Factors From Rainach (2006) STRONG WEAK WATER BrazilAustralia IndiaCuba LIGHT - TEMPERATURE USABLE LAND LABOR COST SCALE OF PRODUCTION GENETICS cost (US$/Ton) AGRICULTURAL TECHNOLOGY 100204 248283

22. 22 Brazil Now Uses About 4 Billion Gallons of Sugarcane Ethanol A Year

23. 23 Yield of EtOH/Ha Has Increased Three Times in the Last 25 Years to 6,000 L/Ha (1,585 gal/Ha) l/ha From Rainach (2006)

24. 24 Ethanol Cost Has Been Reduced Greatly; It Is Now Lower Than That of Gasoline Goldenberg, 2005

25. 25 Flex (Ethanol or gasoline)Ethanol (Pure)GasolineDiesel In Brazil, 70% of All New Cars Sold Now Are FFVs

26. 26 Chinese Corn Ethanol: No.3 Ethanol Consumption Country with ~340 Million Gallons in 2005

27. 27 Four Fuel Ethanol Plants in China Produce 340 Million Gallons of EtOH a Year from Grains CompanyLocationAnnual Production in tonnes Jilin Fuel Ethanol Co., LtdJilin City, Jilin Province300,000 Heilongjiang China Resources Corporation Zhaodong City, Heilongjiang Province 100,000 Henan Tianguan Group Nanyang City, Henan Provice 300,000 Anhui BBCA Biochemical Bufeng City, Anhui Province 320,000

28. 28 Supply of Grain-Based Ethanol in the U.S. and China May Be Limited U.S.China Population (in million)2961306 Gasoline market: billion gallons14016 Diesel market: billion gallons5024 Corn ethanol production: billion gallon 4.20.3 Corn production: million tons332128 Arable land: million hectares186130

29. 29 U.S. Biodiesel Production

30. 30 U.S. Biodiesel Production Has Increased Dramatically and Will Continue to Do So

31. 31 U.S. Biodiesel Plant Location

32. 32 Incentives and Policies Have Played a Major Role in Biofuel Use U.S. –$0.51/gallon incentive for ethanol –$1.00/gallon incentive for biodiesel –The 2005 Energy Policy Act establishes renewable fuel standards Brazil –In early years, government had financial incentives –But sugarcane ethanol is now self-sustaining economically China –Grain ethanol producers receive RMB 1,200/tonne of ethanol

33. 33 Potential Adverse Effects of Large- Scale Biofuel Production Land availability in individual countries Food vs. fuel debate Potential soil effects: erosion, carbon depletion, etc. Water pollution by nitrate from intensive farming Water resource requirements Ecological effects of land cultivation for biofuel production