## Lux Research: wide variance in cost of cellulosic feedstocks for bio-based fuels and chemicals

##### 16 December 2014

In a new report, Lux Research analysts have examined the costs and availability of cellulosic biomass sources for use as feedstock in bio-based fuels and chemicals. They found that while there are 2.4 billion tons of cellulosic biomass available today—led by 1.2 billion tons of municipal solid waste (MSW) costs vary widely. Corn stover costs $91/MT, palm fruit bunches and fronds vary from$75/MT to $105/MT, while wood residues at$33/MT and bagasse $38/MT. MSW is a wildcard—it can have negative costs of up to$55/MT due to tipping fees, but is more challenging to convert than other biomass feedstocks. To put the cost in perspective, an $80/MT feedstock converted to fuels at typical yield, adds$1/gallon to fuel cost.

Cost and local availability are the two most important metrics when analyzing the feasibility of cellulosic biomass options. Despite cellulosic feedstocks’ potential, too many business plans today are still built around unrealistically low feedstock costs, failing to take into account the value of alternative uses, or rising costs as producers prove feedstock value.

—Andrew Soare, Lux Research Senior Analyst

Lux Research analysts examined the cost and availability of eight cellulosic biomass sources. Among their findings:

• Local availability is key. Due to transportation costs, plants need local biomass to be viable. Using a radius distance of 50 km, municipal solid waste is the most plentiful at 1.2 million MT. Corn stover is the next most abundant at 800,000 dry MT; other sources range between 250,000 MT and 350,000 MT.

• Wood residues and sugarcane bagasse are the two cheapest cellulosic biomass resources, costing about 50% less than other sources and can yield 241 million MT. Wheat straw offers 268 million MT, while rice straw is even more plentiful at 642 million MT.

• MSW is the cheapest cellulosic source with authorities willing to pay an average $55 per MT for its disposal. However, it is unlikely that its price will always remain negative, as feedstock cost will increase significantly as successful producers come online. ### Comments Uing MSW (to reduce the size of the garbage mountains) should be a higher priority, if it can be done without too much GHG emissions. A few cities have been working on it. Other feed stocks may not be too advantageous. Direct solar-electricity converters (>40% efficiency) may be much cleaner and more efficient than bio-mass. The U.S. has 200+ million engine vehicles all using liquid hydrocarbon fuels. To say we will use electric from solar cells is a stretch, even if you could overcome the storage problem. People keep talking about how the conversion facilities have to be close to the biomass source, this is easy enough to do but not necessary in all situations. We transport coal thousands of miles, biomass is about the same energy density as lower grade coals. Eventually, excess e-energy (from various sources) will be transformed and stored more efficiently, for delayed uses. Alcohol FCs (fixed and mobile) may become part of it. The world will never run out of energy as long as the SUN shines. When it stops shinning, we will no longer need energy. It might cost$1000 per acre to grow a crop which will yield 1000 gallons per year servicing 5 cars. One acre of solar will cost $1,000,000 servicing 20 cars but cost much more. Using solar energy to grow feed stocks and transform such feed stocks into liquid fuel for our gas guzzlers can be highly polluting and IS NOT EFFICIENT. (Corn Ethanol local production had adverse effects on GHG and food prices) Transforming solar energy (from unused areas and roof tops) into clean electricity with higher efficiency (>50%)converters, storing it with >90% efficient storage units, using it in very high efficiency BEVs should be our main mid and long term objective. I would not convert the solar to hydrogen to make fuels, I would charge EVs. You could get maybe 200 kW per acre with 5 hours per day, that would be enough for more like 100 cars not the 20 I estimated. 5 cars versus 100 cars is a 20 to one, but the investment is 1000 times more. You can see the solar to EV is capital intensive, but uses less land. At a 50 to 1 difference in cost, you would have to run the solar 50 years to gain par. Biomass has a very high impact on the environment, including soil carbon. Feedstocks like MSW that otherwise go to landfills won't change anything if they are re-purposed. If$80/tonne yields a feedstock cost of $1/gallon, it means the typical yield is just 80 gallons per tonne. A gallon of gasoline is 6.17 pounds per my old data, so the yield is just 22.4% by mass. 1.2 million MT of feedstock would yield just 96 million gallons, a far cry from the ~130 billion gpy of gasoline consumed in the USA. On the other hand, if 1.2 million is a typo for 1.2 billion (I'm sure it is), that becomes 96 billion gpy. That's still less than 10% of current demand, but it's definitely able to fill significant gaps after electrification of the easy parts. Using unwanted garbage and agriculture + forestry residues to produce essential energy is deserving and should be done. Growing feed stocks to produce liquid fuels for inefficient ICEVs is not a so good proposition. I take that back. 96 billion gpy of octane-equivalent is equal to about 2/3 of current US gasoline demand, and about 30% of total petroleum demand. That's huge. Per capita and total garbage is increasing every year in USA and in most industrialized countries. Transforming this ever increasing plague into useful energy to replace part of the fossil fuels currently used should be given a much higher national and international priority? The energy produced may cost more than the$10/barrel oil from Saudi Arabia but getting rid of the smelly garbage mountains has a value too.

MSW is more recycle than renewable, we are just reclaiming some of the energy required to make the trash, but that is better than nothing.

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