Increasing Grain Prices Making Operating Costs of First- and Second-Generation Biofuels Similar; Capital Costs Remain an Impediment
|Operating costs for 150 mmgpy gasoline equivalent. Click to enlarge.|
Second-generation biofuels produced from lignocellulosic feedstocks like straw, grasses and wood have long been positioned as the successor to today’s first-generation grain ethanol plants, however the technology has been considered too expensive to compete.
Recent increases in grain prices are now resulting in similar operating costs for first-and second-generation biofuels, according to a paper published in the first edition of Biofuels, Bioproducts & Biorefining (BioFPR), a new journal from John Wiley & Sons and SCI (Society of Chemical Industry). However, the capital costs for advanced biochemical and thermochemical biorefineries—which are comparable—will be four to five times as expensive as comparably sized grain ethanol plants.
Mark Wright and Robert Brown, at the Center for Sustainable Environmental Technologies, Iowa State University, compared the capital costs and operating costs of the current generation of starch-based ethanol plants with those of first-generation lignocellulose-to-biofuels plants.
These lignocellulosic biofuels platforms include enzymatic hydrolysis of cellulose to ethanol (the biochemical platform) and three manifestations of the thermochemical platform in which biomass is gasified and upgraded to hydrogen, methanol, or Fischer–Tropsch (F-T) liquids.
The two researchers showed that the capital costs for 150 million gallon gasoline equivalent capacity range from around $111 million for a conventional grain ethanol plant to $854 million for an advanced (Fischer Tropsch) plant. The difference in the final cost of the fuel, however, was less severe, being $1.74 for grain ethanol when corn costs $3.00 per bushel and $1.80 for cellulosic biofuel when biomass costs $50 per ton.
Among the second-generation variants, thermochemical hydrogen had the lowest operating cost ($1.05 per gallon gasoline equivalent), followed by methanol ($1.28), lignocellulosic ethanol ($1.76), and F-T diesel ($1.80). In comparison, grain ethanol for this size of plant could be produced for $1.22 per gallon of gasoline equivalent. This is cheaper than all the cellulosic biofuels except hydrogen.
|Capital cost and operating cost for|
150 million gallon gasoline-equivalent per year plants
|Fuel||Total capital cost|
|Capital cost per unit production|
($ per gallon)**
|* Per barrel per day gasoline equivalent.|
**Gallon gasoline equivalent
Comparing the costs of biofuels is complicated by the fact that most studies rarely employ the same bases for economic evaluations. Differences in assumed plant size, biomass costs, method of project financing, and even the year in which the analyses are performed can skew comparisons.
Although the costs of production are comparable for grain ethanol and cellulosic biofuels, the much higher capital costs of the cellulosic plants will be an impediment to their commercialization.—Mark Wright
BioFPR. The new journal is offering complimentary online access to institutions throughout 2007 and 2008. The first issue is free access to all on Wiley interscience. In addition, the publishers are developing a free access web portal www.biofpr.com to supplement the journal.
Mark M. Wright and Robert C. Brown; “Comparative economics of biorefineries based on the biochemical and thermochemical platforms”; Biofuels, Bioprod. Bioref. 1:49–56 (2007) DOI: 10.1002/bbb.8