Society Needs Biodiesel and Biodiesel Needs You! Don Scott Director of Sustainability

Transcription

1 Society Needs Biodiesel and Biodiesel Needs You! Don Scott Director of Sustainability

2 Liquid Fuel is a Necessity

3 We must have Liquid fuels that are: Renewable, Energy Efficient, Environmentally Friendly, and Recycle Carbon.

4 Energy Security & Economic Benefits U.S. imports approx. 50% of our petroleum. At a cost of: Over $1 billon every day More than $700,000 every minute We could be spending this money in our own communities. U.S. biodiesel industry can support 78,000 domestic jobs.

5 Burning Fossil Fuels Pumps Carbon Into the Atmosphere The last century has reversed millions of years of carbon sequestration. We are depleting oil reserves while increasing atmospheric CO2.

6 200 million years ago: atmospheric CO 2 was 4 to 5 times its present concentration. 500 million years ago: atmospheric CO 2 was 20 times higher that it is today. Life as we know it today did not survive under those conditions.

7 Early life converted CO2 to solid carbon. Geologic processes converted that carbon to fossil fuels. It took hundreds of millions of years to permanently sequester this carbon and establish the equilibrium that supports life as we know it.

8 Plants and soils only provide temporary storage of carbon. There is a limit to how much carbon can be stored in plant materials or soil. Carbon is returned when forests burn or when they decay. Rotting wood and soil exposed to air return carbon to the atmosphere.

9 Only geology can permanently store carbon. Coal, oil, and, natural gas are all stored carbon. Slow process takes millions of years.

10 Carbon Problem Grows Every year Fossil Carbon emitted each year Carbon absorbed by plants Carbon absorbed by oceans 1% stored in rocks & sediment 7.3 billion tons -2.2 billion tons -1.8 billion tons -.07 billion tons Net Carbon Accumulation 3.2 billion tons

11 Protecting forests is a good idea! Forests are important for biodiversity, habitat, and a great many things. Forests cannot solve our carbon problem. All the plants on Earth cannot absorb carbon at the rate fossil fuels are burned. Geologic sequestration is too slow.

12 Reducing fossil fuel use is the only way to control CO2. Biofuels are a necessary alternative for liquid fuels and other uses of energy.

13 Biofuels Recycle Carbon Plants take CO2 from the air and energy from the sun Plants store carbon in biomass Biofuels harness biomass and stored solar energy

14 Biodiesel is America s Advanced Biofuel has the best GHG profile has the best energy balance reduces criteria air pollutants reduces impact to water resources is the most bio-diverse fuel on the planet improves food security No other fuel can claim all these accolades.

15 How Big Can We Be? US industry goal: 5 x 15 5% on-road displacement by 2015 Mix of blend levels w/ diesel fuel Diverse mix of feedstocks Significant in terms of energy security Significant in terms of emission reductions Responsible, because we can meet this goal by using existing agricultural products, recycled oils, and wastes

16 National Biodiesel Board Feedstock & Process Neutral Biodiesel s Diversity has only Two Bounds: Must meet ASTM D6751 Must be sustainable

17 EPA Definition 40 CFR Advanced Biofuel means renewable fuel has lifecycle greenhouse gas emissions that are at least 50 percent less than baseline lifecycle greenhouse gas emissions. Renewable Biomass (1) Planted crops and crop residue harvested from existing agricultural land cleared or cultivated prior to December 19, 2007 and that was nonforested and either actively managed or fallow on December 19, 2007.

18 Biodiesel is the most diverse fuel on the planet Soybean oil Canola Corn oil from ethanol plants (inedible byproducts) Animal fats (beef, swine, poultry) Recycled grease (restaurants & commercial fryers) Waste grease (trap grease, wastewater treatment) Camelina Sunflower Algae

19 Diversity is key to sustainability. Unity is key to success. United We Stand Divided We Fall Biodiesel must maintain consumer support. Public policy is critical to industry survival. Critical mass is important to momentum on technical issues.

20 Fuel Quality Biodiesel must meet D 6751 to be entered into commerce. ASTM specification D 6751 for B100 D 975 for B5 in diesel fuel D 396 for B5 in heating oil D 7467 for B6-B20

21 OEM Warranty Statements All major OEMs selling diesel equipment in the U.S. support at least B5 and lower blends, provided they are made with biodiesel meeting ASTM D new OEM statements of B20 support so far in 2012, with more expected soon! Now 77% of U.S. manufacturers (30 brands) support B20 or higher blends in at least some of their equipment; More than 95% of the medium- and heavy-duty truck markets now support B20 For a complete listing of OEM position statements on biodiesel, as well as the current U.S. Diesel Vehicles List, visit:

22 OEMs Supporting B20+

23 OEMs Supporting B20+ New OEM B20 Support Statements in 2012: 23

24 Approve B5: Audi ** BMW Mazda Mercedes Mitsubishi ** PACCAR: Peterbilt/Kenworth UD Trucks ** Volkswagen ** ** Actively researching B20 Current B5 Positions NBB s OEM program is strategically focused on getting these companies support B20 to

25 A Model of Sustainability (What traits can make more transportation fuel sustainable) Real Environmental Benefits Increases Energy Security Supporting Jobs and Economic Benefits Commitment to Fuel Quality and Performance Education and Outreach Responsible Goal Setting Successful Public Policy Emphasis on science, quantified analysis, and tackling challenges head-on 25

26 NBB partnering w/ California Biodiesel Alliance Special Sessions planned for Feb. conference in Las Vegas! 26

27 Biodiesel has the Best Energy Balance 3.2:1 in 1998 Grew to 4.56 in 2009 Surpassed 5.5:1 in unit of energy in, plus solar energy, yields 5.5 units of usable energy out.

28 Becoming More Efficient Soybean yield rising: 15% increase Farm energy use decreasing: 20% decrease Biodiesel processing more efficient: 45% improvement

29 5% is Significant Five year average of on-highway diesel fuel demand in the U.S. is 37.8 billion gallons Replacing 5% with biodiesel = 1.88 billion gallons of biodiesel In 2010, the United States imported 1.93 billion gallons of ULSD from other countries. In 2010, the United States imported the equivalent of 1.52 billion gallons of diesel from Iraq crude oil and 3.6 billion gallons from Venezuela crude oil.

30 Biodiesel production by feedstock (millions of gallons) 600 other soybean oil

31 Feedstock Sources 31

32 Co-products of Food Production Protein meal for livestock feed is the primary driver for soybean production Better utilization of the oil coproduct can reduce the price of the protein meal.

33 Where do we expect growth? Virtual Acres Non-traditional Agricultural Yield Growth Land Winter Annuals Algae Halophytes Algae Halophytes

34 Winter Canola Significant Potential Oklahoma now the #2 state in terms of acreage. Life science companies believe yields can be doubled in next two decades Key Questions Will canola compete in winter wheat production areas? Will farmers recognize rotation benefits? KSU reports 20% increases of wheat yields following canola 4,200 lbs/acre winter canola in Kentucky

35 Seed yield [lb/ac] Nitrogen Use Efficient Technology in Canola Transgenic NUE Canola Control Gene No Gene 2000 Arrow #1 Same yield, 66% less N NUE Canola Conventional Canola 1600 Arrow #2 33% Higher yield, same N Nitrogen application level [lb N/ac] 2009 Arcadia Biosciences, Inc.

36 Where do we expect growth? Yield Growth Low Ricin Castor Camelina Winter Canola Seashore Mallow Highway ROW Pennycress Algae

37 National Biodiesel Board RFS2 Work Group Growth Forecast Charged with assessing and analyzing feedstock resources and other relevant factors, including, but not limited to industry production capacity, overall feedstock supply, and global market conditions, for calendar year 2013 and beyond. Developing a recommendation for NBB s official position on RFS2 volumes beyond 2012.

38 Economic Forecasting. NBB utilized partial equilibrium econometric modeling that includes both a domestic and international component Key Assumptions Crude Oil Prices Public Policy Global Domestic Edible Oil Demand Feedstock Options

39 Feedstock Assumptions Enhanced Yields from USDA Baseline for Canola, corn, and soybeans Increased Extraction of Corn Oil from DGS Maintained Animal Fats & Yellow Grease Availability at Current Forecasted Levels USDA Baseline Levels for Palm and Palm Oil Derivatives (e.g. PFAD) No new feedstocks (jatropha, camelina, algae, brown grease etc.) considered in the analysis

40 Corn Oil Yield from Deoiling Distillers Grains

41 US Soybean Yield Assumptions Argentina and Brazil soybeans yields follow the growth in the US scenarios with a one year lag. All other countries are assumed to have historical trend yield growth.

42 U.S. Biodiesel Production Forecasts

43 Report Conclusion By using demonstrated yield technologies available to farmers today in combination with consistent biofuels policies and the DOE/EIA crude oil price forecast, biodiesel production can reach 3.3 billion gallons by This can be reached with growing global food demand for vegetable oils without dramatic increases in vegetable oil prices. A modest expansion of the biodiesel mandate to 2.5 billion gallons by 2017 would provide support for what the industry can deliver given known feedstocks.

44 Biodiesel Lowers Emissions Emission Type B100 B20 B2 Total Unburned Hydrocarbons -67% -20% -2.2% Carbon Monoxide -48% -12% -1.3% Particulate Matter -47% -12% -1.3% Polycyclic Aromatic Hydrocarbons -80% -13% -1.3% Lifecycle Carbon Dioxide -85% -17% -1.7%

45 B20 results in 25% PM reduction w/o Clean Diesel Technology, 67% reduction w/ CDT Source: National Renewable Energy Lab

46 Biodiesel reduces impact to water resources Reduces wastewater by 79% Reduces hazardous waste by 96% 150 biodiesel plants use less water than 2 golf courses Biodiesel requires approx. 2 gallons of water per gallon of biodiesel, including crop irrigation. 1 gal of biodiesel contains enough energy to purify 2,000 gallons of seawater.

47 Biodiesel Enhances Food Security Renewable energy is needed for farming and food distribution Producing food and energy sideby-side may offer one of the best formulas for boosting countries' food and energy security while simultaneously reducing poverty, according to a new FAO report. Makes the business of growing food more stable

48 Biodiesel Enhances Food Security Protein meal for livestock feed is the primary driver for soybean production Better utilization of the oil coproduct can reduce the price of the protein meal.

49 Biodiesel: Advanced Biofuel, Here Now Diversity Biodiesel is among the most diverse fuels in the world, with an expanding array of feedstocks. Yellow Grease Canola Oil Animal Fats Soybean Oil Corn Oil from ethanol production Algae Cottonseed Oil? Camelina Oil?

50 Biodiesel: Advanced Biofuel, Here Now Nationwide Production Biodiesel is produced in every region of the country. There are production facilities in nearly every state, from NY to FL, and from CA to WA.

51 Biodiesel: Advanced Biofuel, Here Now Sampling of Government and Institutional Biodiesel Users Air Force Marines Architect of the Capitol Smithsonian Institution Grand Canyon National Park Grand Teton National Park Great Smoky Mountains National Park Channel Islands National Park Yellowstone National Park Harvard University ( MA) University of California (CA) University of New Hampshire (NH) University of South Carolina University of Washington (WA) New York City NJ Department of Transportation City of Flagstaff City of Ft. Collins

52 Biodiesel: Advanced Biofuel, Here Now A Proven Track Record

53 Biodiesel: Advanced Biofuel, Here Now Biodiesel Tanks at Grand Canyon National Park

54 Federal Policy After starting as a niche fuel, biodiesel has been produced on a commercial scale for only about six years. As a young industry, growth hinges on a strong federal energy policy aimed at increasing domestic production at a responsible rate. Two programs are particularly important to the industry s success: The EPA s Renewable Fuel Standard (RFS2) The biodiesel tax credit 54

55 Biodiesel Tax Incentive The $1 per gallon biodiesel tax incentive helps reduce costs for consumers and makes biodiesel more costcompetitive with petroleum diesel. The incentive has a proven impact on jobs. In just the six years it has been in place, the tax incentive has helped grow biodiesel from a niche energy sector to a commercial-scale industry with plants across the country. 55

56 RFS2 The RFS2 program, implemented in 2010, requires a minimum amount of Biomass-based Diesel (which includes biodiesel, BioHeat, bio jet and renewable diesel) to be blended with petroleum diesel or aviation fuel: million gallons billion gallons billion gallons (proposed) (all use the same feedstocks) 56

57 RFS2 The RFS2 program, was created as part of the Energy Independence and Security Act of 2007 (EISA). In this Congress, there have been discussions and bills introduced to change the RFS2 program. We are concerned that changes to the program would eliminate the use of biofuels in diesel fuel, so we oppose the reopening of the RFS2 program and urge caution when considering changes to it. 57

58 2011 in Review 58

59 Estimated U.S. Biodiesel Production by Calendar Year Volume in Gallons RFS-2 Implemented Biodiesel Tax Credit Extended 1,200,000, Billion 1,000,000,000 Economic Downturn RFS2 Uncertainty Lapse of Biodiesel Tax Credit 800,000, Million 600,000, Million 545 Million 400,000, Million 224 Million 315 Million 200,000,

60 Biodiesel: Advanced Biofuel, Here Now Jobs, Jobs, Jobs

61 BIODIESEL S ECONOMIC IMPACT Year Tax Credit and RFS? Jobs Income (Millions) GDP (Millions) YES NO.800/ YES 1.0 /??? 1.28 /?????? /?????? /??? 21,285 12,407 39,500 39,027 50,725 62,421 74,118 $1,152.4 $667.4 $1,690.9 $2,113.4 $2,746.9 $3,380.4 $ $ $1,206.4 $3,059.8 $3,824.2 $4,970.6 $6,117.0 $7,263.3 **** Source: Economic Impact of Removing the Biodiesel Tax Credit for 2010 And Implementation of RFS2 Targets Through 2015, Prepared by John M. Urbanchuk, Economist - Cardno ENTRIX 61

62 In Summary Biodiesel blends are a drop-in compliment to diesel Biodiesel is available now. Biodiesel has significant environmental benefits Biodiesel reduces $ spent on imported petroleum Biodiesel supports domestic jobs

63 Next Generation Scientists for Biodiesel: An educational network for college students in scientific fields of study SIGN UP! org

64 Sustainability Symposium Organized by USDA, DOE, & NBB Webinar series to cover: GHGs Energy Security Environmental Impacts Food Security

65 Biodiesel is the Best Biofuel GHGs Reduction Compared to Petroleum DATE SOURCE % Better than Petroleum 1998 USDA/NREL 78% w/ Indirect Effects 2008 DOE/Argonne 66-94% 2010 USEPA 86% 57% 2010 DOE/Argonne 89% 122% 2010 GHGenius 86% 2011 CARB 78% 51%

66 Updated Greenhouse Gas Emission Results of Biodiesel with the GREET Model Jeongwoo Han and Michael Wang Center for Transportation Research Argonne National Laboratory Biodiesel Technical Workshop Kansas City, MO, November 2, 2010

67 Biodiesel WTW results depend on the method of dealing with co-products -79% -73% -89% -77% -74% -87% -86% -86% -107% -122% Extraction + Production 19% 81% Meal + Glycerine 81% BD 19% System Level Allocation Glycerine Soybean meal Each co-product method has weaknesses Displacement: co-product yields are larger than main product yields. Energy allocation: co-products are not energy products. Market allocation: market values (prices) vary over time. Mass allocation: values in the products of the same mass are different. Extraction 20% 80% Soy oil 20% Production 90% 10% BD 90% 67 Meal 80% Glycerine 10% Process Level Allocation

68 P kg/tonne Soybean Phosphorus Fertilizer y = x Phosphorous Linear (Phosphorous)

69 kg K2O/tonne Soybean Potassium fertilizer y = x Potassium Linear (Potassium)

70 Corn Yield, kg/ha Corn Yields 12,000 10,000 y = e x R 2 = ,000 6,000 4,000 y = e x R 2 = , Ontario Corn US Corn Expon. (Ontario Corn) Expon. (US Corn)

71 Nitrogen, Kg/tonne Yield, tonnes/ha Corn fertilizer rates and Yield y = e x N Fertilizer Rate Corn Yield Expon. (N Fertilizer Rate)

72 Kg P or K/tonne Harvested Corn fertilizer rates y = e x R 2 = y = e x R 2 = P Fertilizer Rate Expon. (P Fertilizer Rate) K Fertilizer rate Expon. (K Fertilizer rate)

73 Soybean Energy Use

74 Soybean Soil Carbon Changes

75 Index E nergy E fficiency, E nergy/farm Output Agriculture Energy Efficiency Index - US