Wood energy policies and recent developments in the OECD fileForest Products Biotechnology at UBC What is bioenergy? Energy derived from all biomass, including forests Derived as heat

Forest Products Biotechnology at UBC

W.E. Mabee, J.N. SaddlerForest Products Biotechnology University of British Columba

UNECE / FAO Policy Forum: Opportunities and impacts of bioenergy policies and targets on the forest and other sectors

10 October 2007

Wood energy policies and recent developments in the OECD


IntroductionOver 50% of forestry biomass harvested today is used for energy (FAO 2007)

Recent reports prepared by the OECD, UNECE, IEA, FAO and others has informed the discussion tremendously

New policies are changing the role of wood-to-bioenergy

Research is still required, including development of better data describing biomass recovery from forestsand trade opportunities for biomass and biofuels

Introduction to bioenergyBioenergy policiesBioenergy and forestsInfluence of bioenergyNorth American issuesTake-home messages


What is bioenergy?Energy derived from all biomass, including forests

Derived as heatTransformed into electricityDelivered to industrial, transportation sector via biofuels

Wood energy is one component of total bioenergy

May be produced and used on-site (either residential or industrial)

May be produced for third-party sales

A type of renewable energy(when produced sustainably)



Bioenergy use (OECD)

Industrial (39%)

Residential (33%)

Heat (1%)

Electricity (7%)

CHP (13%)

Other (7%)

3rd Party Sales


Source: IEA 2007


Bioenergy use (non-OECD)

Industrial (9%)

Residential (77%)

Heat (0%)

Electricity (1%)

CHP (0%)

Other (12%)

3rd Party Sales


Source: IEA 2007


Residential bioenergy

Residential bioenergy options:- Open fires- Traditional wood stoves- Charcoal- Wood pellets



Industrial bioenergy

Industrial bioenergy options:- Combined heat & power- Power boilers- Gasification- CHP + Heat recovery systems



What are biofuels?Bioenergy feedstocks, usually in solid or liquid forms (i.e. wood pellets, bioethanol, biodiesel, etc.)

Biofuels may be classified by biomass source:Agrofuels (i.e. sugar, starch, vegetable oils)Woodfuels (fuelwood, charcoal)

Solid biofuels include wood pellets, charcoal, etc.Liquid biofuels may be classified by feedstock:

Food-based liquid biofuels (derived from foodstuffs)Cellulosic liquid biofuels (derived from the cellulosic component of agrofuels and woodfuels)



Bioethanol worldwide

0

10

20

30

40

50

6019

80

1985

1990

1995

2000

2005

Others India China EU US&Can Brazil

Production capacity (billion litres per annum)



Biofuel producers (OECD)(bioethanol, biodiesel in 2006)

0

1

2

3

4

5

6USA

Can

ada

Ger

man

y

Spai

n

Swed

en

Ger

man

y

Fran

ce

Aust

ralia

Ital

y

USA

Bioethanol Biodiesel

18.4

Production capacity (billion litres per

Source: IEA 2007



Cellulosic platformsBIOMASS

ThermochemicalPlatforms

BiologicalPlatforms

TraditionalPlatforms

Structured separation

Fast separation& reconstitution


IndustrialBioenergy

LiquidBiofuels

Value-addedBioproducts


0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%O

pen

fire

Woo

d st

ove

Cha

rcoa

l

Pell

et s

tove

CH

P

Pow

er b

oile

r

Gas

ifie

r

CH

P +

heat

rec

over

y

Etha

nol

(syn

gas)

Etha

nol

(str

aw)

Etha

nol

(woo

d)

Fisc

her-

Trop

schs

Conversion efficiency (n e )

Residential bioenergy Industrial bioenergy Liquid biofuels f/wood

Comparing efficienciesIntroduction to bioenergyBioenergy policiesBioenergy and forestsInfluence of bioenergyNorth American issuesTake-home messages


Bioenergy policy toolsTop-down, ‘rigid’ mechanisms

Feed-in tariffs(set a specific price that utilities must pay to domestic producers of ‘green’ electricity)

Fixed price mechanisms(premium or bonus paid above the normal rate directly to producers and/or distributors of ‘green’ energy)

Renewable energy obligation(mandate the amount of renewable energy in an energy portfolio)

Bottom-up mechanismsGreen certificates(renewable electricity is sold at conventional prices, but consumers must purchase green certificates to cover a % of total electricity consumption)

Tax incentives, loan guarantees, grants

Source: FAOStat 2007a, FAO 2006, FAO 1998



Recent developmentsEuropean UnionFour primary policies cover the European Union:

Energy efficiency in buildings and end-use applications (2 Directives)Trade of GHG emissions throughout the EU (Directive 2003/87/EC)Production of electricity from renewable sources (Directive 2001/77/EC)Promotion of biofuels for transport (Directive 2003/30/EC)

A Biomass Action Plan has also been developed (2005)

A new Directive (2007) sets specific goals beyond 2012:20% target for renewable energy in 202010% target for biofuels in 2020Includes a sustainability scheme




Recent developmentsUnited States

21 States have renewable portfolio standardsFederal renewable fuel mandateFederal initiatives include a tax credit for biomass energy (but this does not yet apply to all forest bioenergy)Loan guarantees are also available under the Biomass energy and Alcohol Fuels Act of 1980

CanadaA Renewable Energy Working Group has been formed by the Canadian Council of Energy Ministers and tasked with providing a framework to maximize renewable energy potentialSome provinces (Ontario, Quebec, British Columbia) developing independent strategies that include bioenergyOntario has recently introduced a feed-in tariff that applies to biomassA Renewable Energy Deployment Initiative ended in March 2007; a new ecoEnergy/ecoAction programme is being implemented




Bioenergy policy issuesNot clearly differentiated from renewableenergy goals and policies in most cases

Interdisciplinary nature of bioenergy requires multiple agencies to collaborate in traditional government systems(i.e. natural resources, environment, energy, interior, transport, etc.)

Confusion exists over performance metrics(i.e. economics, GHG emissions, energy balance, contribution to TPES, etc.)

Need for coordination between stakeholders



Policy impacts(additional energy required)

North America301,700 TJ bioenergy, including9,400 GWh biomass-to-electricity by 20102,475,500 TJ biofuels by 2017

Europe1,353,200 TJ bioenergy, including 17,600 GWh biomass-to-electricity by 2010573,000 TJ biofuels by 2010

Other OECD179,900 TJ bioenergy, including2,800 GWh biomass-to-electricity by 2010 18,500 TJ biofuels by 2010\






Other OECD179,900 TJ bioenergy, including2,800 GWh biomass-to-electricity by 2010 18,500 TJ biofuels by 2010



0

50

100

150

200

250

USA

Can

ada

Fran

ce

Swed

en

Finl

and

Ger

man

y

Aus

tria

Cze

ch R

ep.

Nor

way

Swit

zerl

and

Net

herl

ands UK

Recovered (post-consumer)

Indirect (black liquor, pellets)

Direct (from forests)

Wood-to-energy (M m3/year)

Source: Steierer et al. 2007

Introduction to bioenergyBioenergy policies Bioenergy and forestsInfluence of bioenergyNorth American issuesTake-home messages

The Joint Wood Energy Enquiry (UNECE, FAO, IEA, EC) providesdetailed data on the volumes andflows of wood energy in 12 European and 2 North American countries

Wood-to-energy (OECD)(Joint Wood Energy Enquiry)


0

50

100

150

200

250

USA

Can

ada

Fran

ce

Swed

en

Finl

and

Ger

man

y

Aus

tria

Cze

ch R

ep.

Nor

way

Swit

zerl

and

Net

herl

ands UK




Wood-to-energy (M m3/year) (% indicates wood in TPES)

2.0%

3.8% 3.2% 15.6%18.5% 1.9%

9.3% 3.7% 4.5% 3.0% 0.5% 0.1%



Wood-to-energy in TPES(Total Primary Energy Supply)


Wood-to-energy

0

50

100

150

200

250

USA

Can

ada

Fran

ce

Swed

en

Finl

and

Ger

man

y

Aus

tria

Cze

ch R

ep.

Nor

way

Swit

zerl

and

Net

herl

ands UK




Wood-to-energy (M m3/year) (% indicates wood in TPES)

2.0%

3.8% 3.2% 15.6%18.5% 1.9%

9.3% 3.7% 4.5% 3.0% 0.5% 0.1%



In North America, ~20% of wood-energy is direct from forests

In Europe, ~45% of wood-energy is direct from forests


Forest biomass (OECD)

0

50

100

150

200

250

300

350

400

Canada Australia USA Spain France Germany Japan Finland Sweden Austria Other

OECD

Forest 'surplus' (Growth - Removals) (M m3/year)

Source: Mabee Saddler 2007


Total ‘surplus’ forest biomass: Approximately 893 M m3 per year (?)

However, we don’t know:- how much is economically available- how much is really sustainable





Other OECD179,900 TJ bioenergy, including2,800 GWh biomass-to-electricity by 2010 18,500 TJ biofuels by 2010



Policy impacts - A(additional wood-to-energy)

0

20

40

60

80

100

120

140

160

A. Current

trends (to

2010)

Other

Finland

Sweden

France

Canada

USA

Additional woodfuels (M m3/year)

85 M m3/year



If current proportions of wood energy as a component of renewable energy persist, and current conversion technologies are not improved, approximately 85 million m3 of additional forest biomass will be required to meet OECD policy goals by 2010

This is approximately 10% of the total forest ‘surplus’ across the OECD membership


Policy impacts - B(additional wood-to-energy)

0

20

40

60

80

100

120

140

160

A. Current

trends (to

2010)

B. High

efficiency, no

biofuels (to

2010)

Other

Finland

Sweden

France

Canada

USA


85 M m3/year

73 M m3/year



If new facilities employ state-of-the-art conversion technologies and all additional renewable energy requirements are met by wood energy, about 73 million m3 of additional forest biomass would be required by 2010 – less than the current trends case.

This is approximately 8% of the total forest ‘surplus’ across the OECD membership


Policy impacts - C(additional wood-to-energy)

0

20

40

60

80

100

120

140

160

A. Current

trends (to

2010)

B. High

efficiency, no

biofuels (to

2010)

C. High

efficiency,

10% biofuels

(to 2017)

Other

Finland

Sweden

France

Canada

USA


85 M m3/year

73 M m3/year

148 M m3/year



If the previous scenario is extended, and it is assumed that 10% of liquid biofuel requirements will also be met with wood biomass, it is estimated that about 148 M m3 of forest biomass will be required by 2017.

This is about 17% of the estimated forest ‘surplus’ across the OECD.


Policy impacts (additional wood-to-energy)

0

20

40

60

80

100

120

140

160

A. Current

trends (to

2010)

B. High

efficiency, no

biofuels (to

2010)

C. High

efficiency,

10% biofuels

(to 2017)

Other

Finland

Sweden

France

Canada

USA


85 M m3/year

73 M m3/year

148 M m3/year



The largest forest biomass requirements are likely to be found in the US and France, followed by Canada, Finland and Sweden.


Influence of bioenergyExpected increases in demand for forest biomass for bioenergy are relativelymoderate across the OECD

However, the demand for forest biomass could increase substantially with even a moderate increase in cellulosic biofuels

The impacts of food-based vs. wood-based biofuels needs to be explored further

Three big issues: energy balance, carbon balance, and food-vs.-fuel issues



Energy balance(energy investment vs. output)

0

5

10

15

20

25

30

35

40

Marland &

Turhollow

1991

Lorenz &

Morris

1995

Graboski

2002

Shapouri

et al. 2002

Kim & Dale

2005

Pimentel &

Patzek

2005

Tyson et

al. 1993

Lynd &

Wang 2004

Sheehan et

al. 2004

Pimentel &

Patzek

2005

Ethanol Distribution

Industrial Processing

Feedstock Transport

Agriculture/Forestry

Net energy investment (MJ/litre)

Energy in 1 L of ethanol = 23.6 MJ

Corn-to-ethanol Cellulose-to-ethanol

Source: NRDC 2006. Ethanol: Energy well spent.



GHG Emissions(biofuel technologies)

0 20 40 60 80 100 120 140 160 180

Bioethanol / woodfuels

Bioethanol / agrofuels

Bioethanol / sugars

Bioethanol / starches

Gasoline

Spark-ignition fuels:

Fischer-Tropsch / woodfuels

Fischer-Tropsch / agrofuels

Biodiesel / waste oils

Biodiesel / oilseeds

Diesel

Mixed diesel-gasoline

Compression-ignition fuels:

Emissions, g CO2-equivalent/km driven

Source: VIEWLS 2006. Clear data on Clean Energy.



Food vs. fuel(Mexican tortilla crisis)

Between August 2006 and January 2007, prices for tortillas in Mexico rose 3-4x, reaching about $1.81/kg (US)

Cause was reputedly high maize prices and a shortage of Mexican supply, due to increased exports to the USA

However, most biofuels rely on ‘yellow’ corn, while tortillas are made from ‘white’ corn

However, the dispute in the media continues

Source: Rosegrant et al., 2006



Schmidhuber (FAO, 2006) found that the extra demand for biofuel feedstocks has resulted in increased global agricultural commodity prices

An increase in food prices would impact food security in some nations, particularly where food is scarce

A price increase for food commodities would likely increase incomes in rural areas and potentially reduce poverty

Historically, real prices for food and agriculture have been declining, and a departure from this trend to meet biofuel demand may not be permanent

Food vs. fuel(food commodity prices, 2020)




0%

20%

40%

60%

80%

100%

120%

140%

Cassava Sugar beet Sugar cane Oilseeds Maize Wheat

Focus on food-based biofuels

% increase in food commodity prices by 2020 (over 2005)



Study by the International Food Policy Research Instituteusing the IMPACT model (Rosegrant et al. 2006) found that,

under an aggressive scenario of biofuel growth, biofuel use would rise by 2-10x



0%

20%

40%

60%

80%

100%

120%

140%








0%

20%

40%

60%

80%

100%

120%

140%



Shift to wood-based biofuels






0%

20%

40%

60%

80%

100%

120%

140%




Shift to wood-based biofuels +improved agriculture






0%

20%

40%

60%

80%

100%

120%

140%




Shift to wood-based biofuels +improved agriculture




Wood-based biofuels can help minimize expected increases in food commodity prices


North America goalsUnited States

Triple bioenergy and bioproducts use by 2010Identify 1 billion tonnes of cellulosic feedstock for energy and fuel production by 2030

368 million tonnes forest biomass933 million tonnes agricultural biomass

133 billion litres of renewable fuels by 201730% bioethanol in gasoline by 2030

CanadaNo national bioenergy targetProvincial-level bioenergy goals being developed5% bioethanol in gasoline by 2010 2% biodiesel in diesel fuel by 2012







Cellulosic ethanol

Iogen ($80 M)(Enzyme)

Bluefire ($40 M)(Acid)

Poet ($80 M)(Enzyme)

Abengoa ($76 M)(Enzyme / Thermochem)

Range ($76 M)(Thermochem)

Alico ($33 M)(Thermochem)

Demonstration plants (USDOE funding):







0

2

4

6

8

10

12

14

16

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2005: 7 million hared attack

2005: 15 million ha 'spread over' (green, red, grey)

million ha

Cumulative impacts - areaD

enm

ark

5 m

illio

n ha

Port

ugal

10 m

illio

n ha

Sources: 1) Council of Forest Industries 2005.



Take-home messagesResearch is still required, including development of better data describing biomass recovery from forestsand trade opportunities for biomass and biofuels

Policy does not yet define the role of forests; clear bioenergy policy goals would help define the size of the opportunity for forests

Policy impacts include an increased role for biofuels as well as bioenergy in the form of heat and power; this may result in great increases to forest biomass demand

When pursuing a biofuel future, wood-based biofuels can:Improve energy balance over food-based biofuelsReduce GHG emissions over petroleum fuels and food-based biofuels Reduce the impacts that biofuels will have on food pricesHelp deal with local impacts of climate change


AcknowledgementsFood and Agriculture Org.(Wulf Killman & colleagues)

International Energy Agency(Bioenergy Tasks, Task 39)

Natural Resources Canada,NSERC, Government of BC

Forest Products Biotechnology,University of British Columbia

Documents

Wood energy policies and recent developments in the OECD fileForest Products Biotechnology at UBC What is bioenergy? Energy derived from all biomass, including forests Derived as heat