Biofuel Conference Call Including a New Biodiesel from Algae
Posted by Gail the Actuary on August 22, 2008 - 9:43am
Topic: Alternative energy
Tags: algae, algal biodiesel, bio, biodiesel, biofuel, biotechnology industry organization, cellulosic ethanol, ethanol, original [list all tags]
A few days ago I participated in a conference call (recording available here) about biofuels with an organization called Biotechnology Industry Organization (BIO). In this article, I will discuss some things I found interesting, including a new technique for making biodiesel that involves feeding biomass to algae.
The call had three speakers. The first, Jim McMillan of the National Renewable Energy Laboratory gave an overview of the current US biofuel situation. According to him, a lot of current interest is in cellulosic ethanol, since corn ethanol doesn't scale up very well. At this point, the cost of cellulosic ethanol seems to be double or more that of corn ethanol. The economics are still being clarified by demonstration projects. Until there is some sort of climate legislation that raises the price of carbon, it will be difficult to overcome the price gap.
The second speaker was Reid Detchon of Energy Future Coalition, who spoke about political factors affecting biofuels. The big legislation they are looking forward to is the climate-change legislation that would raise the price of carbon, because they believe either McCain or Obama would support such legislation. Such legislation would make biofuels more cost-competitive. This fall, the EPA is scheduled to examine the carbon impact of various biofuels over their life cycles. This could have an impact on how corn ethanol is viewed relative to other biofuels.
The third speaker was Jonathan Wolfson of Solazyme. I found this the most interesting of the three presentations. Solazyme has a process for making biodiesel using algae. Instead of growing algae outside, Solazyme grows micro-algae in tanks in the dark inside, and feeds the micro-algae biomass, such as processed switchgrass. They believe they have developed a technique that is not far from commercial development.
Observations
Biotechnology Industry Organization (BIO) is an industry trade organization, located in Washington D. C.. In many ways it is not too different the from American Petroleum Institute (API), except operating in a different industry. As such, it shouldn't be too surprising if the material they present casts the biotechnology industry in as favorable a light as possible. This is a bias you may want to keep in mind, if you read their materials or listen to the conference call.
The first two speakers on the conference call expect that some sort of climate change legislation will be passed, once a new administration is in place. I am skeptical that that will actually happen. Once people look at the costs involved, I expect that very little will legislation will be passed that raises the price of carbon. Also, a lot of things could change between now and 2009. I expect the US financial situation will be significantly worse by the end of the year, because of the continued high price of oil. If we have a cold winter as well, I expect support for the legislation will be pretty low.
The conference call was an hour long, so there is quite a bit more on the tape than what I discuss here. If the topics are of interest, you may want to listen to the recording.
Solazyme Technology
As indicated above, I found Jonathan Wolfson's presentation on their new algae technology interesting. According to Wolfson, when the usual approach of growing algae with sunlight is used, the algae have to be efficient on two different processes: (1) transforming light into chemical energy and (2) transforming the chemical energy into oils. In Solazyme's approach, they only have to be efficient at the second half of this process--turning the chemical energy into oils.
With this approach, a variety of different feedstocks can be used. The process basically turns carbohydrates into oils. The oils that are produced can be used in various ways--as a food, as a fuel, or as a chemical feedstock. According to one video I watched from their website, the oil is somewhat similar to olive oil.
In some ways, the Solazyme approach is not too different from an ethanol approach. With ethanol, yeast often acts on corn or biomass feedstock to provide alcohol as an output. With this approach, it is algae that acts on biomass, to provide an oil as an output.
Solazyme claims that it has been able to produce biodiesel fuel that meets the standards for Number 2 diesel fuel. They claim that the fuel they produce can be used at 100% concentration, year around, without problems. I believe that the tests they have run were in only one vehicle, for one year. It seems to me that more tests would be needed to show the limitations of the fuel. For example, do microorganisms grow in the fuel, and cause the problems in the tank after a couple of years?
Solazyme claims that the process they have developed can be scaled up fairly quickly. They have tried to make the process as compatible with existing equipment as possible. The oils they have made to date have been made on large scale equipment owned by someone else, using short production runs. If they leased the equipment full time, or built their own facility, they claim they could make the oil in quantity. Whether or not this can be done needs to be proven, because collecting and processing adequate biomass for any biofuel operation is challenging.
If I understand correctly, Solazyme's goal is to produce biofuel that is competitive with diesel, without subsidies, in a fairly short time. They believe that they can scale up the process (probably to the size of a demonstration plant) in 24 to 36 months.
If you are interested in learning more about this, you will want to listen to the last third of the conference call tape. You may also want to look at the Solazyme website. There are several videos about the process available on that website.
Could this be a panacea?
Regarding whether this could be a panacea, there are still a lot of obstacles in the way. The process is only at a developmental stage, and hasn't been tested at scale. Also, the total amount of biomass available in the US isn't necessarily all that great, if one starts burning it for fuel in vehicles. We are basically using the same biomass to replenish our soil; to provide wood for heating homes; to provide biomass for fueling electric power plants; to provide feedstock for cellulosic ethanol and now to provide feedstock for algal diesel as well. There is clearly not enough biomass to do all of these things at the scale some might like, simultaneously.
Exactly how much biomass might be available is a subject for another post. A first pass estimate based on the Billion Ton Study is that there is enough biomass to replace about 20% of the US petroleum usage, if biomass is not used for other purposes, such as heating houses. This could be helpful, if we are short of petroleum products, but it isn't a complete solution.
Why haven't we heard about this before?
Solazyne is a privately held company. It is not trying to hype the stock.
Japanese brewer made superyeast for breaking down cellulose
http://nextbigfuture.com/2008/08/japanese-sake-brewer-makes-cellulose.ht...
Some seem to indicate that the 1.3 billion tons of cellulostic plant material could make 4 billion barrels of oil.
This translates to 65% of American oil consumption.
Huber, National Science Foundation and the U. S. Department of Energy titled "Breaking the Chemical and Engineering Barriers to Lignocellulosic Biofuels,"
Garbage conversion to fuel. Target commercialization by 2010. 2.5 billion gallons/year by 2022.
http://nextbigfuture.com/2008/08/gasoline-produced-from-biomass-in-cars....
The University of Virginia team hypothesizes that feeding the algae more carbon dioxide and organic material could boost the oil yield to as much as 40 percent by weight. If this pans out 27 billion tons of CO2 from fossil fuel plants can be used to boost algae oil yields.
http://nextbigfuture.com/2008/08/feeding-algae-carbon-dioxide-and.html
That 1.3 billion tons of cellulostic plant material is a one shot deal.
Next time around its 6 billion tons, then 3 billion, then desert.
OK slight egzageration but you get the idea.
OBTW food production would follow the same path.
We need to ramp up the ramping down process.
Craig Ventner reckons they can create 4th generation fuels, i.e. synthetic microorganisms that will produce alternative fuels, such as ethanol or hydrogen from a CO2 foodstock plus sunlight. He thinks we can have this in less than 18 months! With his usual high level of confidence in himself (and team) he says this will replace the petro-chemical industry.
We seem to be getting close to having the capability to create complex molecules, and even to create them for specific uses.
Best hopes for a sustainable future.
Repeat after me, "EROEI EROEI EROEI EROEI EROEI." If the media and culture conditions for the organism costs more energy than the the petroleum products you get out then it won't be replacing anything. When we previously discussed this on TOD, the guy who was leading the project said he needed to sell his by-products before he could market his organism. That says low EROEI to me.
I really hope C. Venter is right. However, I find it curious he thinks he can do it in 18 months, when the evolution could not make them in 4 billion years. Just based on computational time alone, I think his team is just way out of time.
Is C Venter smarter than God? I don't know, ask him.
I asked Him, and he doesn't know who C Venter is...
;-)
This is a website that seems to be on something similar. I don't know about the timeframe, though.
It looks to me like that operation would keep, maybe, 100,000 high-mileage cars on the road.
That's a big wind-farm. How many Prius's would 240 Meawatts fuel if you went straight to the grid.
Evolution didn't do it because it had no reason to. What is the competative advantage to survival for a microbe in producing biofuel?
1.3 billion tons at around 13.6 MMbtu/ton for cellulosic biomass is about 17.6 quads for the dry feedstock. Optimistically you can get maybe 10 quads of liquids from that. We use about 40 quads liquids, around 27 for transportation. Arguably better to consume it in Robert Rapier's Personal Biomass Reactors to displace natural gas and heating oil for which we use about 11 quads of the two resources in residential and commercial applications.
How about we move about 1.6 kg of uranium around the country to get the same amount of energy available ...
You have a bike ? That should (literally) do.
One of the benefits of growing algae for biofuel (in theory, at least) is that annual yield can be quite high as compared to conventionally-grown crops. The Solazyne approach seems to toss that aside by growing other things to feed the algae. We're back to adding another intermediary in the capture of solar energy.
Secondly, the amount of energy that can be stored by algae as lipids would seem to be intrinsically less than that stored by yeast or bacteria as polysaccharides. True, the energy requirements for trans-esterification (biodiesel) are different from fermentation/distillation (ethanol), but I wonder what the overall energy comparison looks like.
Alas, we can replace 20% of US petroleum usage by slowing down, but won't.
Gail, I am interested in how these projects are funded. Was there any discussion of this? The tried-and-true university lab to VC to IPO route seems too slow and inefficient, given the importance of the task, and a "Manhattan project" would produce too narrow a focus. Are you aware of any innovative funding approaches?
This kind of remarks always amazes me. They are perfectly valid but I always think we can't assume that because these are true now they will stay true forever. People won't slow down because they are in denial and don't see any harm. This will last only for so long.
There will come a day where it will dawn on the people that they cannot afford the price of gas and there are line ups at the gas station. It will dawn on them that there is a reason for the high price and line ups. Denial will no longer be a sustainable attitude. At this point some unthinkable things such as slowing down and taking the bike to go to work will become routine.
As long as the majority of the population has a death-grip on the past, it is going to be hard to get people to readily accept conservation.
Conservation doesn't sound like much fun to most people. They have never really been exposed to the possible alternative lifestyles that don't place industrial consumerism as the core pursuit. It is going to be hard for Westerners in partiular to accept it and there will be much social and economic disruption and chaos to go through to get to whatever it is on the other side. It is the most intersting times indeed.
Gail, I haven't gotten all the way through the call, yet; but, my impression was that the "Capital" Cost (basically, the Plant) of cellulosic is about twice the cost of corn. That jives with what I've been reading.
Companies like Bluefire, however, are projecting that they will be producing from MSW for about $1.00/gallon. BTW, they've been using this technology at a plant in Japan, producing about 1.4 Million gpy, for a couple of years.
Admittedly, the MSW (Municipal Solid Waste) Producers will have, by far, the lowest feedstock costs in the industry (in that, basically, in many cases, they're getting their feedstock for free;) but, I think the Gassifiers are, also, looking at a lower overall cost than the corn refiners.
You are probably right, it is the capital costs that are double. Producers who can get their feedstock for free are in good shape. They probably won't be a big share of the market.
It seems like the jury is still out on how much cellulosic ethanol feedstock from traditional sources will really costs. One issue is whether you really need fertilizer to make the process work, in the quantities people hope. This will add to the costs/feasibility. I know when they tried growing switchgrass in Iowa, the cost was (from memory) at least as high as that of corn--perhaps higher.
I don't know, Gail. We produce about 250 Million Tons of Solid Waste in the U.S. At 80 gal/ton that would be 20 Billion Gallons. That's about 1.3 Million barrels/day.
I think most of the energy "crops" will be grown in the south. The land is less valuable, and the climate is better. Ceres is talking 20 tons/acre in Fl. This would be between 1,600 and 2,000 gal/acre.
What I find intriguing about this process is every landfill will have a gassifier; and this means Every County will be able to raise twenty, or thirty thousand acres of Switchgrass, Miscanthus, etc. and have a close-by market for the product.
BTW, farmers have been baling hay for hundreds of years. It's not like they don't know how to work with biomass.
One thing that I think is being overlooked is that corn ethanol is creating an economic boom on the Plains! We should embrace this!
I don't want to hurt farmers, my family is from corn country in Indiana. However, corn ethanol is a poor choice for the long term because of the poor EROEI.
Industrial monoculture of corn would seem a poor choice if the goal is long-term sustainability of the soil.
Those few farm families who remain (most have left for the city) will not be building for future generations of farmers if they go down that path much longer.
The banks don't value sustainability. They just want that interest after the crop is sold this year. Farmers will grow as much as they can and sell as much as they can in order to pay the bank and still have a small profit. If someone is willing to buy the stover and straw for more than the cost of industrial fertilizer then that is what they will do. If someone will pay then to conserve soil, i.e. the taxpayers then that is what they will do. Somehow suburbanites don't understand the advantages of paying farmers not to grow on every square inch.
The website doesn't give too much information. One thing it does mention was that Chevron Technology Ventures is funding some of their work. They also have a page talking about their partnering strategies, but don't give much detail.
There are also several interesting looking videos on Solazyme's Media Page that may give some more insight. I haven't had a chance to look at them.
If this technology really works, it seems like a better use of biomass (or even corn) than most of the ethanol projects out there. For one thing, biodiesel is a better end product. For another, if the cost is lower, it probably is more efficient in its use of the feedstocks it is using. We already have a lot of sunk investment in corn ethanol, so I expect there will be desire by some to stay with what we have.
I agree that something like a "Manhatten project" probably makes sense, but I don't know precisely how. One of the catches is that we really have to be certain we have the right technology before we scale it up. Many people would like to scale up whatever their approach is.
One of the problems in assessing these non-public companies with undocumented claims is that although they may not have to attract more capital, they can have targets to meet to retain the funding they have.
A good example of this may be Nanosolar, where their claims have been subjected to heavy criticism, as they may have just produced a few panels at huge expense to reach their funding targets, and be a lot further from volume production than they are trying to apparently indicate.
Anyway, the point is that you can't necessarily trust the sort of claims Solazyme is making, even though they are not tryijng to attract public funding.
The claim is only as good as the data backing it up, and in this case it is thin, to say the least.
?
I read somewhere (Cnet I think) that because of the speed of the Nanosolar manufacturing process, they should be on target to produce more MW of solar PV panels from a single plant than the rest of the plants in the US put together. I seem to remember reading here on TOD, a discussion about how well their manufacturing was going and that they were able to run their "printing press" faster than originally planned. AFAIK they are definitely shipping in volume and the lack of news from them or their customers suggest that things are going at least as well as planned.
Alan from the islands
I have seen a lot of claims by Nanosolar, and not much backup.
I tend to agree with Katherine's comments here:
http://blogs.spectrum.ieee.org/articles/2008/07/first_solar_quest_for_th...
First Solar, in contrast, is very transparent and has audited accounts of it's strides in reducing costs.
Manhattan Project doesn't make sense. Cost didn't matter in MP. Getting the A-bomb before the Nazi did matter very much. Can you envision a real fuel project in which cost doesn't matter? I don't think so.
There was a 'getting the right technology' problem in MP. It concerned separating U235 from natural uranium. Several ways were proposed. The decision was to work on all of them in parallel.
Spot on! That's the reason why no government in the world is putting any meaningful sums inot alternative energy. You only need a rudimentary understanding of economics to realise that alternatives don't stack up compared to fossil fuels and it is unlikely they ever will. The argument about applying a carbon cost penalty, whichever way you do it, to make renewables more cost competitive misses the point that it is cheap, abundant, and apparently limitless, energy that has powered modern civilization to its current heights. Knock out any of those attributes and the whole thing will go out of balance and will fall over. It doesn't matter if renewables are abundant and limitless. If they are not cheap, the economics of BAU don't stack up.
What do you call "meaningful"? Germany is paying 5B euro/yr in alternative energy subsidies, and has become a world leader (in both installation and manufacturing) in them as a result.
The point of a carbon tax is to make the price of fossil fuels correctly take into account negative externalities such as pollution. That renewables will (typically) suffer much less from such a tax is in many ways coincidental.
And perhaps one needs a more nuanced understanding of economics to realize that the situation is not as clear-cut as that.
Term & Pitt:
I wrote my objection to Manhattan Project, because IMO, talk of Manhattan Project is a cover for wishful thinking that scientists in the laboratory will save use. All we, the people, have to do is throw money at the right collection of scientists.
Concerning your comments about taxes, etc.
In the future, the price of fossil oil will rise due to scarcity. If there is no substitute for fossil oil, price will rise without bound, ie really a LOT. If no substitute is found at any price, there will be massive demand destruction, population collapse, turmoil, etc. I happen to believe that there are already substitutes from known technologies that will come into play at some very high price. But not so high a price as to cause total collapse and extinction of human race. If I'm right in this, there will be serious turmoil and demand destruction, and a residue population will come into balance with this reduced supply of substitute synthetic oil. During the time of transition to synthetic oil, the prices of the synthetic and of real oil will be essentially the same.
I'm not worried about actual extinction of human race, but I do think that some government action might mitigate the transition. Taxes on carbon from fossil fuels seem to me to be a reasonable government action. The goal is a tax that is high enough to make an unsubsidized renewable fuel price competitive with the taxed fossil fuel. The tax could start small and rise over time until suppliers of alternative fuels actually enter the market. Once alternative fuels are established, the tax should be adjusted, up or down, to maintain some reasonable market share for the 'alternatives'. Eventually the fossil fuel will become so scarce that it is not competitive even with no special tax. The tax can be repealed. The transition has been made.
Making the tax correctly take into account negative externalities is economic doublespeak. The purpose of the tax is to encourage the move to alternatives fuels by shifting the prices in the marketplace. Talking about negative externalities opens the door to setting the tax too low to achieve its purpose. One can get a very low estimate for the required tax by not looking very hard for hidden externalities. People can be quite good at failing to find something that they don't want to find.
A problem with this proposal is what to do with the tax receipts. They would be a big windfall income for the government. I have no good ideas on how to keep these from being spent on goofy projects. And I think a big tax without commensurate spending might cripple the economy.
Its a puzzle.
I don't really expect this proposal to have much success. More likely will be subsidies for specific technologies that have well funded lobbies. And no tax to pay for the subsidies!!
To a large extent, yeah.
The problem here isn't really knowledge - we could replace oil with the technology we already have - it's more an issue of rebuilding and replacing large amounts of infrastructure. That's an industrial task, not an engineering one, so the Manhattan Project isn't really a good analogy.
It's reasonable even without worries about peaking fossil fuels. Carbon emissions are a negative externality, and so a tax that internalizes them would make the market more efficient. (And, no, that's not double-speak.)
The fact that it would move us significantly away from oil - as demonstrated by Europe - is a happy side-effect IMHO. And - as also demonstrated by Europe - it's possible to lower oil consumption an enormous amount by a tax like this, with a relatively minor impact on people. (Before someone tries, no, the US isn't "different" because it's big; over 100M Americans live in denser states than France, so density isn't the difference.)
Cut other taxes to make it revenue-neutral. That's the proposal I pretty much always see, and I'd argue it's the most sensible one. Indeed, it gives an opportunity to lower payroll and income taxes in favour of a consumption tax, which most economists would argue is an improvement in overall tax efficiency. Win-win.
Thanks for the link. I wonder if Chevron has selected this project because it doesn't rock their boat too much, rather than because the economics are favorable - a pitfall of the tax-deduction funding approach. If governments are going to provide matching funds and tax credits, what chance to truly disruptive technologies have?
I also wonder how the NPK nutrients get back to the field/forest in this approach, or have they considered that?
There is a definite advantage to technologies that are not too disruptive. They are easy to adopt quickly, without huge infrastructure changes. I think with the timing issues of peak oil, and the related financial problems. we really should be giving strong preference to technologies that are not too disruptive.
One of the advantages of the reported technology (assuming it works), is that the biodiesel can be blended in with the regular diesel and shipped through the pipeline. This would be much better than trying to ship huge quantities of ethanol around the country in railroad cars and trucks, and mix it in at the end. Also, engines don't have to be modified to receive higher blends.
I also wonder how the NPK nutrients get back to the field/forest in this approach, or have they considered that?
Mostly by truck, and rail, I'd imagine.
As Gail pointed out in the Q&A, there is an imbalance developing between ethanol, and diesel. As ethanol replaces more, and more gasoline the refiners are in a bind. Produce sufficient diesel, and get an oversupply of gasoline. Produce the right amount to gasoline, be undersupplied in diesel. If they can't hold ethanol back they need to find a little help in their diesel supply.
Toss in efficient driving across the board and that's closer to 50%. But keep it on the down-low, every gallon of gasoline not used keeps more than it's cost out of the economic sub-systems associated w/ it's production. Next time you decide to drive efficiently, stop and think of the billionaires.
Hasn't this research already been done? IIRC (no sorry, I'm not going to try and find the research, but I think George Monbiot cites it in one of his articles) in every case, we're worse off in terms of releasing CO2 into the atmosphere by making and burning biofuels, as compared to simply burning the fossil fuels that one needed to make the biofuels. Am I missing something here?
dtbks,
There was a rather silly article published in the Journal, "Science," that supposed that if Rain Forest trees were cut down in Brazil to plant Soybeans, to make up for the shortage of Soybeans on the world market due to American farmers planting less beans in order to plant more corn as a result of a higher corn price due to Ethanol, THEN you could end up with more CO2 in the atmosphere than if you just burned gasoline.
Of course, the deal-killer on that argument is that there are, according to the agriculture minister of Brazil, something like 150 Million acres lying fallow in the cerrano, at present. No one in their right mind would log a forest to plant soybeans when the vacant land is lying right next door. Actually, people Log trees to get Logs!
The article was "commissioned" by the Nature Conservancy which is strongly influenced by the Donations, and two Permanent Board Seats occupied by Major Oil Companies.
Corn ethanol plants are like any other. Some are much more efficient in the use of fossil fuels than others. There are some on the way that will use virtually none.