Shell exec says biofuels are the most important alternative to fossil hydrocarbons in mobility for the next 20 years
In a keynote interview to open F.O. Licht’s World Ethanol & Biofuels in Barcelona on 8 November, Arthur Reijnhart, General Manager, Alternative Energies and Fuel Development Strategy for Shell, described a scenario of an increasingly diverse energy supply landscape against a backdrop of soaring demand between now and 2050, driven by population growth, increasing incomes and increasing urbanisation of the world’s population.
Reijnhart said that fossil fuels will be harder and more expensive to get, given that new oil and gas reserves are likely to be found under ice caps, deeper under the sea or under difficult political conditions. Shell’s view is that the 3% of energy for mobility from alternative sources will increase to up to 30% after 2030, with the increase coming from a portfolio of products.
Within this, Shell sees a place for gas, hydrogen and electricity, but Reijnhart was clear that: “We see biofuels as the single most important alternative to hydrocarbons in mobility in the next 20 years.”
Reijnhart several times stressed Shell’s strategic intention to operate “at scale” in the biofuels market, with particular reference to its recent launch of Raizen, its $12-billion joint-venture with Brazilian sugar and ethanol producer Cosan. (Earlier post.)
Reijnhart said that first-generation and second-generation biofuels were different pillars of the same long-term strategy. He suggested that breakthroughs in the production of cellulosic ethanol will come in the early 2020s. Noting that this is part of the long-term future for biofuels, he emphasized Shell’s commitments to R&D in the next-generation technology.
In the short term, Reijnhart sees that a diverse range of products in the mix will be crucial if 2020 mandates are to be met. Recognizing the importance of diesel in the European transport fuel market, he said that FAME (biodiesel) and HVO (hydrogenated vegetable oil) will play a part, though the blend levels of the former would likely differ between light-duty vehicles and freight, while the penetration of the latter was potentially limited by feedstock constraints. Overall, he called for support from the EU and national governments to ensure that the industry is able to meet the RED targets.