BioCycle January 2009, Vol. 50, No. 1, p. 45
Biomass Energy Outlook
Mark Jenner

WHAT a year 2008 has been for the bioeconomy! Financial problems for ethanol and biodiesel companies were aggrevated by outrageous prices for corn and soybean oil. Ethanol plants paid three times as much as their budgets had projected prior to construction.
High 2007 energy prices continued climbing through the first half of 2008. Crude oil nearly hit $150/barrel. During the last half of the year, however, the economy caved in and all the prices fell. By December, crude oil was close to $30/barrel.
Despite this roller coaster ride of prices, it became apparent that the new bioeconomy is deeper than the cost of crude oil. A big driver is greenhouse gas remediation. Here’s a snapshot of the biomass energy world as we dive into 2009.
CELLULOSIC BIOFUELS
With the creation of the Energy Independence and Security Act of 2007, the U.S. began its aggressive march toward 20 billion gallons of cellulosic and advanced biofuels by 2022. The clock is ticking. Industry and government are spending billions trying to establish a definitive, commercial technology.
Currently, by my count, 27 companies have joined the “race” to commercialize a cellulosic biofuels technology. (See BioCycle November 2008, “Commercializing Cellulosic Ethanol,” and page 35 of this issue.) Over 400 million gallons of cellulosic ethanol production are under development in the U.S. This is a good thing too, because that is close to the “nonconventional” biofuel (i.e., other than corn ethanol and biodiesel) renewable fuel standard for 2010.
Twenty percent of the 400 million gallons will be generated from MSW in nine projects. Another 23 percent will be generated from wood in eight projects. Thirteen projects will provide the remaining 57 percent from ag residues. Most of these projects intend to produce ethanol, though some produce butanol, pyrolysis bio oil and naptha. [Shell, BP and ConnocoPhillips have additional initiatives under development.] ALGAL FUELS
I have identified 29 developers working to commercialize algal fuels. This is double the number from six months ago. Most produce a biodiesel biofuel, though some target ethanol, gasoline and other fuels. Curiously, many are growing algae in near commercial volumes (without a clear indication that they can cost-effectively convert it to biofuels). Others are very good at producing fuel, but have yet to move out of the laboratory. No one has achieved commercial production yet.
Some biofuels developers are shifting over from existing commercial production of algae-derived food products. Emerging remediation markets geared to carbon dioxide, nitrogen and phosphorus also are drawing algae developers. About half of the algal biofuel developers are targeting more than one market (fuel, food or remediation).
The clear leader in building commercial infrastructure is PetroSun, Inc. in Scottsdale, Arizona. PetroSun is developing a 1,100 acre salt-water algae farm in Rio Hondo, Texas. More recently, it began converting financially-challenged catfish farms to algae production. However, this does not guarantee economic success. One of the most rapidly expanding ethanol companies, VeraSun, was an economic marvel until it filed for bankruptcy a few months ago.
METHANE
According to EPA’s Landfill Methane Outreach Program (LMOP) data, in the first 10 months of 2008, 37 gas utilization projects had been installed at landfills; 24 projects had a total electricity generating capacity of 71.5 MW. Another 24 projects involved direct gas utilization in boilers. Some projects included both. In 2007 (12 months of data), 45 projects produced 150 MW of generating capacity.
Direct use of methane from manure anaerobic digesters is also increasing. Environmental Power Corporation began operating its Stephenville, Texas plant. It had some difficulties initially, but by the end of the year renewable natural gas was being delivered to Pacific Gas & Electric, with whom they have a contract. The project is reported to produce 635,000 MMBTUs (million btus). They have seven more similar very large manure and industrial waste projects scheduled. The total energy reported for these eight digester projects is over 4,000,000 MMBTUs, equivalent to about 50 MW of electricity.
Farm digesters continue to grow as do municipal wastewater digesters. At this pace, non-landfill gas methane production (and utilization) approaches the installation rate of landfill gas methane projects.
SOLID BIOMASS & POWER
In 2008, I tracked projects and proposals for over 2 million tons of fuel pellets. Existing mills produced 900,000 tons. Extremely high prices for oil this summer created hording of pellets in the Northeast. This year, every pellet project looks like a good investment. That may change by next year.
Biomass power plants are also on the rise. I recorded biomass power plant proposals of over 800 MW generating capacity. Those were mostly from wood, but included yard waste, biosolids and solid manure. Conventional power plants are beginning to realize that regulated Clean Air Act emissions can be significantly lowered by adding biomass.
Small biomass power plants being built today need to identify nearby power plants that may compete with them for local fuel sources. A 700-MW coal-fired power plant using biomass for 5 percent of its inputs requires the same supply as a 35-MW power plant.
Mark Jenner, PhD, operates Biomass Rules, LLC and has over 25 years of biomass utilization expertise. Burning Bio News is Jenner’s scorecard of bioenergy project adoption, available at www.biomassrules.com.