Biofuel Transitions in S.E. Asia : Thailand s Leading Example

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Biofuel Transitions in S.E. Asia : Thailand s Leading Example Samai Jai-Indr, Ph.D.

Project, 14-16 June 1, Kuala Lumpur, Malaysia Thailand s Economy in 9 65 Millions Population ~1% of World; Per capita 4,338$, (PPP :

5 % of GDP % of Employment 1st Import Item : Crude Oil (15.6% of import bill) Major Agricultural Products & World Rankings Rice 3.

1 Biofuel Transitions in S.E. Asia : Thailand s Leading Example Samai Jai-Indr, Ph.D. Energy Specialist, Energy Standing Committee, House of Representatives, Asia Oceania Convention on Global Sustainable Bioenergy Project, June 1, Kuala Lumpur, Malaysia Thailand s Economy in 9 65 Millions Population ~1% of World; Per capita 4,338$, (PPP : 8,5$) GDP US$73 Billions (553.4 Bn, PPP) Agriculture: 11.4 % of GDP 4 % of Employment Manufacturing: 44.5 % of GDP % of Employment 1st Import Item : Crude Oil (15.6% of import bill) Major Agricultural Products & World Rankings Rice 3. MT from 11 M. Ha.(1st Exporter) Rubber 3. MT from 1.76 M. Ha.(1st Producer&Exporter) Sugarcane 64.4 MT from 1.1 M. Ha.(Export 75%, nd) Cassava 7 MT from 1.17 M. Ha.(Export 8% 1st) Oil Palm 6.6 MT from.4 M. Ha.(3rd Producer) 1

2 ASEAN GDP in MUSD, Current Market Prices, Data from ASEAN Total Population : 583 Millions, Ave. GDP Per Capita :,581 USD (GDP PPP 5,3 USD) Total Land Area 4.4 Million Sq.km. 1,6,. 1,4,. ASEAN Total GDP : 1,56 Billion USD Japan GDP : 5,1 Billion USD (7) China GDP : 4, Billions USD India GDP : 891 Billions USD (7) Lao PDR 9,71 166,773 7,965 1,,. 146, ,457 45,544 86,91 98, ,64 13,73 73,666 Singapore Malaysia 6,645 14,75 4,. Philippines 186,454 46,36 137,971 Myanmar,58 157,37 17,464 Cambodia Viet Nam 167,11 5,953 8,. 6,. 184,1 6,965 1,,. Brunei Darussalam Thailand 176,7 161,386,. 39,134 84, ,371 43, ,174 Indonesia / Asia has changed, Thailand has also changed : Economic & Social Integration, Climate Change Impact, The way we live (urbanization) and the way we work also change, And so do Agriculture : The backbone! Demographic Changes Aging society by 5,

3 Share of Transportation Fuels in Thailand (Figures in Million Litre/D) Since 8, All HSD contains % of Biodiesel 1% % % % % % 4% % (Jan-Oct) NGV LPG Gasohol Gasoline Diesel % 1% % LPG Demand in K.Tons (source : PTT) 6, 658 ~% yoy 5, , , , 6 33, , Transport Industry Petrochemical Household , 1,5 1,513 1,6 1,468 1,13 1,348 1,64 1,5 1,43 1, ,884 55,14, ,

Thailand Thailand s Energy Policy Presented to the Parliament on Dec 3 th 8 1 5 Policy

Set Renewable Energy as National Agenda E85 Ethanol based oil 3 Policy Encouraging Energy

house Emission Reduction Support CDM Projects reflect its genuine cost Develop Services

Development and Consumption Conservation Measure energy Efficiency Standard Encouraging

Alternative end-use from food/feed market Less labour intensive Higher Productivity Rural

4 Thailand Thailand s Energy Policy Presented to the Parliament on Dec 3 th Policy Policy Securing Energy Resources Oil Natural Gas Electricity Alternative Energy Policy Set Renewable Energy as National Agenda E85 Ethanol based oil 3 Policy Encouraging Energy Conservation Bio Diesel NGV Wind /Solar / Ensure Fair Energy Price Price structure Green house Emission Reduction Support CDM Projects reflect its genuine cost Develop Services Quality Biogas/ Biomass/ Small Hydro 4 Policy Preserving Environment coupled with Energy Development and Consumption Conservation Measure energy Efficiency Standard Encouraging Private Safety in Energy Related business Investment Drivers Agriculture Diversification Alternative end-use from food/feed market Less labour intensive Higher Productivity Rural Job Creation Bridge Building I : ASEAN/GMS CrossBorder Trades Bridge Building II : Low Carbon Society 4

5 Labour Force : 36 M strong, but. Thailand will move into an aging society by 5, window of opportunity is closing From NESDB Landuse / Arable Area in Thailand 7 48% Rice Paddy,593,136, %,9,83, % 1,13,83, 1% 3,69,998, 3% 1,36,938, 1% 8,66,646, % Perennials Rice Paddy 63,551,14, 48% Year Crops ท อ ย อ าศ ย ท น า ท พ ช ไร ท ไ ม ผ ล แ ล ะ ไม ย น ต น ท ส วน ผ ก แ ล ะ ไม ด อ ก ท ท ง ห ญ า เล ย ง ส ต ว ท ร ก ร า ง เน อ ท ท า ก าร เก ษ ต รอ น ๆ 7,49,969, 1% 5

6 Net Farm Crop Income USD/Ha/Yr Data from OAE, MOAC,5. Average Farm Holding in Thailand ~ 3 Ha./Household Poverty Line = 54 USD/person/yr =,1 USD/Household/yr Average Farm Holding,. USD/Ha./Yr. 1,5. 1,. Poverty Line : 7 USD/Ha./Yr. 3.7 Mln. Mln. HH 5. - Rubber Palm Cane Cassava Rice Maize Food&Energy Crop Price Statistics in Thailand Data from OAE, MOAC. 4.5 Palm FFB THB/Kg 4 Cassava Root THB/Kg Cane Price THB/Kg 3.5 THB/Kg Palm FFB THB/Kg Cassava Root THB/Kg Cane Price THB/Kg 6

7 Energy Crop Plantation Areas in Thailand (M.Ha., data from OAE, MOAC) Oil Palm Cassava Cane Food/Feed/Fuel Crop at Farmgate Values in Million Baht (Data from OAE,MOAC) 14, M.B M.Ha..8 OilPalm 1, Cane Cassava 1, 38,189 6,7 8, 16,49 4,94 6, 11,47 13,87 7,543 4, 4,964 5,549 4,875 4,53 5,475 43,96 16,115 9,3 3,789 34,87 6,16 5,785 3,918 44,9, 15,1 1,1 1, ,71 18,337 17,15 3 4,58 9,134 31,

New Equation into the old ag. commodity New Equation into the old ag. commodity 15yr REDP O il Palm Price FFB (Data from DIT,M O C) B Mandate 4.

8 New Equation into the old ag. commodity New Equation into the old ag. commodity 15yr REDP O il Palm Price FFB (Data from DIT,M O C) B Mandate B3 Ma nda te Th.B./Kg. 3.5 National Biofuel Strategy Biodiesel Project initiation

9 Planted areas(1 rais) Production(1 tonnes) Sugarcane Area and Production in Thailand (Data : OAE) 8, 8, 6.5 Rai = 1 Ha. 7, 7, 6, 6, 5, 5, 4, 4, 3, 3,,, 1, 1, Planted areas(1 rais) Production(1 tonnes) Cassava Area and Production in Thailand (Data:OAE) 1, 3, 6.5 Rai = 1 Ha. 1, 5, 8,, 6, 15, 4, 1,, 5,

10 Oil Palm Production in Thailand.6 1 Plantation Area (M.Ha.) FFB Production (M.Tons)

Total 8 =6 ML/d 8 NGV Replace Gasoline NGV Replace Diesel 3% % 15%

11 Alternative Energy Targets for Road Transport Sector of Thailand 8 - Million Litre/Day Total =96 ML/d 1 9% Gasohol Bio Diesel 5% Total 8 =6 ML/d 8 NGV Replace Gasoline NGV Replace Diesel 3% % 15% 16% Gasoline 8% 5% 45% 66% 4 Diesel

12 Gasoline and Gasohol Consumption in Thailand, ML/Day %.5% 9% 4% 39% 18% 3% 31% % 16% 6% 6% 61% 55% 64% 5% 61% 6% Gasoline 91 7 Gasoline 95 4% 33.5% 8 t) c O na (J 9 Gasohol Biodiesel Consumption Volume (Aprl. 1) B5 Volume Sale 1.56 ML/day (B ML/day) Diesel(B) Volume Sale 4.8 ML/day (B1.496 ML/day) Total volume of B ML/day B3 Mandate since June 1st, 1 : B1 Vol. 1.9 ML/day B1 in B5 B1 in B Total B1,, 1,8, 1,6, Liter/Day 1,4, 1,71,36 1,, 1,, 8, 1,7,845 6, 4,, 68,481 Jun-5 Aug-5 Oct-5 Dec-5 Feb-6 Apr-6 Jun-6 Aug-6 Oct-6 Dec-6 Feb-7 Apr-7 Jun-7 Aug-7 Oct-7 Dec-7 Feb-8 Apr-8 Jun-8 Aug-8 Oct-8 Dec-8 Feb-9 Apr-9 Jun-9 Aug-9 Oct-9 Dec-9 Feb-1 Apr-1 Update: Sep. 9 1

81 4,, 5 6 7 8 9 5 6 7 8 9 1 5 6 7 8 9 4 5 6 7 8 9 v- eb- ay- ug- ov- eb- ay- ug- ov- eb- ay-

13 Biodiesel Consumption in Thailand ML/day,, B3 Mandate since June 1st, 1 1,8, 1,6, 1,4, B1 in B B1 in B5 68, ,, 1,, 8, 6, 1,7, ,, v- eb- ay- ug- ov- eb- ay- ug- ov- eb- ay- ug- ov- eb- ay- ug- ov- eb- ay- ug- ov- ebf F F F F F A A A A A No N N N N N M M M M M Ethanol Production in 1 Plants :.9 ML/day Consumption : 1.3 ML/day 13

Oleochemical Plant, Rayong BDF Plants : 14 Production capacity : 5.9 ML/day Consumption : 1.

Biorefinery Concept Use up to 1% Biodiesel Farm Truck BDF F BD Small&Smart Solution Palm BDF for Farm Truck

Bunch Manure ENERGY ISLAND Glycerol Power BIODIESEL BDF Production Unit Quality Control JCL Toxicity Test

14 Oleochemical Plant, Rayong BDF Plants : 14 Production capacity : 5.9 ML/day Consumption : 1.9 ML/day Vertical integration among petroleum refiners & oil palm complex (TOL-PTTCh, PBC-RPC, BCP Biorefinery Concept Use up to 1% Biodiesel Farm Truck BDF F BD Small&Smart Solution Palm BDF for Farm Truck Agri machines Solid Fuel pellet Palm Fronds Gasification Single Cylinder Engines Power Power Empty Fruit Bunch Manure ENERGY ISLAND Glycerol Power BIODIESEL BDF Production Unit Quality Control JCL Toxicity Test Power Vegeta ble oil Oil Extraction Oil seeds น าม นสบ ด า Glycerol Cake Palm and JCL Plantation Animal Feed Single Cylinder Engines 14

15 Oil Palm Expansion in Acidic Areas FFB Yield 3 Tons/Ha. in 8 FFB Yield 36 Tons/Ha in 9. Planted Oct.4 Farm Co-op, Conversion technology, Microgrid B1 Own-use, Animal Feed- farm use, Sell excess to refiners for food,fuel, Small & Smart = Beautiful & Competitive 15

16 B1 Cost Structure Blender B1 1 L B1 Plant CPO 1.5 kg B Conversion Cost : 4 B/L CPO 3.49 CPO 7.89 FFB 5.33 B FFB 5.5 kg Oil Extraction Plant Conversion Cost: 1.5 B/L FFB 5. Farmers Total Cost :.5-3 B/kg Fixed Cost : 5% - 8% Variable Cost : 9% - 95% Transportation Cost :.3 B/Kg FFB 4.56 B/kg Note: FFB CPO Conversion Rate = 18%, CPO B1 Conversion Rate = 95% FFB 3.79 B/kg From V. Sriyanyongwat, Next Gen. Biofuels 9, Bangkok. Change : Megatrends Econ crisis: towards managed capitalism Climate change Energy crisis: emerging alternative energies Shifting of geopolitical power to Asia Population/aging society/ urbanization ICT changes life style Resource crisis: land, food, waste, water Green economy: economy, society, and environment 3 ท มา: ฝ ายแผนกลย ทธ และนโยบาย สก. 16

17 Bio-Ethanol Roadmap Sugar / Starch Platform Biorefinery 56BE 17CE Bioenergy & Biomaterial Synergy Automotive Industry Dev : E85 - FFV Clean Production of Ethanol E85-E1 for Agricultural&Industrial Machines 555BE 1CE Crop Improvement for Bio-Process E/E85 Impact to Engine, parts, Emissions nd Generation Biofuels Optimized Production Tech Crop for sugar/ biomaterials E/FlexFuel for motorcycles Cellulosic Alcohol Technology Optimized Anhydrous Ethanol Prod. Tech. Enzyme & Yeast Tech. Development Optimized Hydrated Ethanol Prod. Tech. Agricultural Zoning Crop Dev. For inc. sugar/starch content E1 Impact to Engine, Parts, Emissions 55BE 7CE Ethanol from canejuice, molasses, cassava Biodiesel Roadmap Mol. Biology Convergence 56BE 17 17CE Bioenergy & Biomaterial Synergy High yield Palm oil B1,B Impact to Engine, parts, Emissions Bioplastic Prod. Tech. 555BE 1CE B5 Impact to Engine, parts, Emissions Oil Crops for Rice Paddy BDF/ Syn Diesel Tech. BTL/BDF convergence BDF Production / Zerowaste High-value extractn from CPO Process for Lignin Conversion Optimized Prod. Process Heterogeneoes Catalyst Glycerine Utilizatn Tech. Co-product Dev. BDF : Fatty Acid Ethyl Ester Impact of B1 with Farm Truck Pre/Post Harvest / Zoning /Agronomy JCL Toxicity Issues Agri. Machines Dev. BDF QA/QC Oil Crops Var. Improvement/ Breeding B1 Agri. Engine Tech. B/B1 Impact to Engine, parts, Emissions 55BE 7CE Veg.Oil Extraction Proc. Dev. 17

Way forward Roles & significance of Small Holder Best Practice : Small & Smart Solutions, Some of the extreme poverty : Bottom Billions, < 1 USD (PPP) / day are in the Greater Mekong Subregion.

18 Way forward Roles & significance of Small Holder Best Practice : Small & Smart Solutions, Some of the extreme poverty : Bottom Billions, < 1 USD (PPP) / day are in the Greater Mekong Subregion.Too ill, too weak, too poor, too deep in political conflict to climb up the ladder of Development, Small Holder Empowerment = Poverty Reduction Biofuel can be the 1st step, then congregate and develop onto higher values products :starch, sugar and oleochemical platform, Capacity buildings & (Fair) Trade instead of Food Aid ASEAN Common Market 15. South-South Actions The Green-belt and the Bottom Billions 18

Barriers to SE Asia Biofuel Exports to the European and US markets

Barriers to SE Asia Biofuel Exports to the European and US markets Samai Jai-In, Ph.D. Energy Specialist, Energy Standing Committee, House of Representatives, Thailand IEA HQ, Paris 16th September 2010