Biomass Supply Curves for the UK E4tech 2009

1

Biomass supply curves for the

UK

March 2009

Summary

For DECC

2

Contents

1. Introduction

2. UK supply

3. Global supply and imports to the UK

4. Supply curves for UK energy demands

5. Conclusions

3

Scope and aims

3

• In this project, we were asked to develop supply curves for the UK biomass

market, based on

• a range of UK feedstocks and imported feedstocks

• five points in time: 2008, 2010, 2015, 2020 and 2030

• four scenarios of the supply curve development

• The supply curves and data will be used by DECC in ongoing modelling and

analysis to

• compare the relative costs of biomass and other renewable options in the

electricity, heat and transport sectors

• estimate the costs to the UK of the renewables target

• identify the optimal use of limited biomass resources

• assess the impacts of technology development

• develop consistent incentives across all sectors

1. Introduction

4

Relationship between key parts of the analysis

4

Scenarios

Global supply

curve

UK supply curve

(without imports)

Global demand

levels

Price of imports to

the UK

UK supply curve

(with imports)

Separate UK

supply curves for

different UK

demands

1. The scenarios affect UK and global supply of biomass feedstocks (land use, yields,

extractability) and global demand (policy, technically viable end uses)

2. The UK supply curve is then built up

3. The global supply curve for feedstocks that could be imported, and the level of

global demand for these feedstocks, is used to determine the price of imports

4. The overall UK supply curve is broken down in to separate supply curves showing

the resources suitable for conversion by different technologies, to meet different

demands

1

2

3

5

1. Introduction

4

5

Introduction to scenarios

5

• Four scenarios were defined:

• Business As Usual (BAU) – a continuation of current trends, without the EU

RED. This includes continued trends in use of first generation biofuels, and in

waste diversion from landfill, and modest technology development in energy

crops and second generation biofuel production

• Central RES – As BAU, but with the introduction of the RED. This results in

an increase in EU demand for bioenergy, and sustainability criteria restricting

land use for energy crops

• High Sustainability –greenhouse gas savings and other sustainability

impacts are prioritised. This leads to lower energy demand through efficiency,

strong technology development, and stronger bioenergy demand side policy.

• High Growth –energy and food demand increase globally, putting increased

pressure on resources. However, the response to this leads to strong

technology development, and a move away from less resource efficient

technologies. Some sustainability constraints are relaxed compared with

Central RES

1. Introduction

6

Feedstocks considered

6

UK feedstocks

Energy crops Short rotation coppice willow or poplar, and miscanthus

Crop residues Straw from wheat and oil seed rape

Stemwood Hardwood and softwood tree trunks

Forestry residues Wood chips from branches, tips and poor quality stemwood

Sawmill co-product Wood chips, sawdust and bark made when sawing stemwood

Arboricultural arisings Stemwood, wood chips, branches and foliage from municipal tree surgery

operations

Waste wood Clean and contaminated waste wood

Organic waste Paper/card, food/kitchen, garden/plant and textiles wastes

Sewage sludge From Waste Water Treatment Works

Animal manures Manures and slurries from cattle, pigs, sheep and poultry

Landfill gas Captured gases from decomposing biodegradable waste in landfill sites

Global feedstocks

Energy crops Woody short rotation crops, such as eucalyptus and willow


Wood processing residues Sawmill co-product and waste wood from the wood processing industry

Others – considered in the annex only, not included in supply curves

First generation biofuels Ethanol from sugar and starch crops, and biodiesel from oil crops

Algae Oil and biomass from photosynthetic algae

1. Introduction

7

Deriving supply curves

7

Resource

• Potential

minus technical constraints

minus environmental constraints

minus competing demands for the resource

minus an availability factor for supply constraints

1. Introduction

Costs

• For most feedstocks any remaining resource after competing demands is

available for bioenergy at the cost of production/extraction - no competition with

the competing demand on the basis of price.

• Exceptions :

• Energy crops –includes land rent i.e. all competing uses of land

• Imports – global supply and demand are used to find the global price. This

is assumed to be the price at which the UK can import, i.e. the UK is

assumed to be a price taker

8

Contents

1. Introduction

2. UK supply



5. Conclusions

9

Introduction to biomass supply curves

9

Cost

Quantity

Negative cost

feedstocks are those

for which there would

be a fee to dispose of

them

Total

available

resource

Positive cost

feedstocks

• This can be for one feedstock,

or can be the sum of the supply

curves for many different types

of biomass feedstocks

2. UK supply

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200

Co

st (£

/GJ)

Supply (PJ)

BAU Scenario: UK supply cost curve

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

10

Supply curve for all feedstocks - BAU scenario over time

10

2. UK supply

Box done

• The potential bioenergy resource is large

• It increases significantly to 2030, mainly due to expansion in

energy crops and increased ability to extract other feedstocks

• There is a large resource at negative cost due to avoided gate

fees: organic MSW, sewage sludge and waste wood

• Positive cost feedstocks include straw, forestry residues,

stemwood and sawmill co-product – but these are small

compared with the potentially large energy crop resource

• Note: these costs do not include landfill tax, transport to plant, or

preprocessing – this is added separately for each demand later

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ)

Supply (PJ)

BAU 2030 Wastes

BAU 2030 Energy crops

BAU 2030 Forestry

BAU 2030 Agricultural

11

BAU scenario in 2030, broken down by feedstock type

11

2. UK supply

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

0 100 200 300 400 500 600

Cost

(£/G

J) Supply (PJ)

BAU Scenario: UK supply cost curve BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

0 100 200 300 400 500 600

Cost

(£/G

J) Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

0 100 200 300 400 500 600

Cost

(£/G

J) Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

Energy crops-8.0

-7.0

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

0 200 400

Co

st (£

/GJ)

Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

Wastes

ForestryAgricultural

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ) Supply (PJ)

BAU 2030

Central RES 2030

High sustainability 2030

High growth 2030

12

Supply curve for all feedstocks - all scenarios in 2030

12

2. UK supply

• The total potential is affected strongly by the energy crop potential:

the High Growth scenario has a large land area and highest yields.

This is reduced in the BAU scenario as a result of lower crop yields,

and in the Central RES and High Sustainability scenarios as a

result of greater constraints on the use of abandoned pasture land

• Energy crop potentials in both BAU and High Growth scenarios

remain constrained in 2030 by planting rates

• Energy crop costs are lower in the High Sustainability and High

Growth scenarios, as a result of higher yields

• Potential from wastes is reduced in High Sustainability due to lower

volumes of waste generation, and is increased under High Growth

13

Contents

1. Introduction

2. UK supply



5. Conclusions

0.0

2.0

4.0

6.0

8.0

10.0

12.0

0 50 100 150 200 250

Co

st (

£/G

J)

Supply (EJ)

BAU Global supply curves

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

14

Deriving import price from global supply and demand - BAU

14

• Feedstocks are forestry and

wood processing residues, and

energy crops – ‘woody biomass’

• Forestry and wood processing

residues are small (7 EJ) in

2030 in comparison with the

energy crop resource (196 EJ)

• The resource increases to 2030

with energy crop yield increases

and planted area

• If we know the global demand

for woody biomass in a

particular year, we can use the

global supply curve to

determine the cost of supplying

that demand

• If the UK is assumed to be a

price taker, this is the price at

which imports are available to

the UK

3. Imports

Global demand of 15 EJ

in 2030 gives a global

price of £3.48 /GJ

(equivalent to £63 /odt)

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

15

Under BAU, import prices fall over time, but remain expensive

15

• The UK could import significant volumes of woody biomass - more

than enough to supply UK demand – at the global market price

• However, imports would be high cost

• In 2010, import prices are more expensive than all other UK

resources

• In 2030, imports are only cheaper than the most expensive

straw and energy crops

• These results depend heavily on the transport assumptions made,

as transport adds around £2/GJ to most global feedstock costs

2030 import price £3.48 /GJ2010 import price: £6.52 /GJ

3. Imports

16

Supply curves under different scenarios differ

considerably in 2030...

16

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

0 50 100 150 200 250 300

Co

st (

£/G

J)

Supply (EJ)

BAU 2030

Central RES 2030


High growth 2030

• The main difference between

the scenarios is the energy

crop resource

• High Sustainability has the

greatest potential and the

lowest costs as a result of

• more abandoned agricultural

land

• potentially better quality

agricultural land may be

abandoned

• high energy crop

management factor

• In High Growth, extra food

demand requires more

agricultural area, and hence

less is available for energy

crops, and poorer non

agricultural land is used

3. Imports

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ) Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

17

...but lead to a similar (and high) import price

17

BAU, Central RES and High Growth

import price £3.48 /GJ

• Under BAU, Central RES and High Growth the import price of

3.48 £/GJ is more expensive than nearly all UK energy crops

and straw

• Under High Sustainability, the import price is lower at 3.13

£/GJ, as the cost of the first tranche of global energy crops is

cheaper. However, UK energy crops are also cheaper, hence

imports are still more expensive than 95% of the UK’s

resources

High Sustainability import price £3.13 /GJ

3. Imports

18

Contents

1. Introduction

2. UK supply



5. Conclusions

19

Building appropriate supply curves for different demands

19

• Deciding which feedstocks to combine on supply curves for biomass conversion

can be complex, and depends on how they will be used.

• All of the resources on the supply curve must be suitable feedstocks for the

conversion technology being considered, in terms of

• Need for wet or dry feedstocks

• Sizing or other pretreatment requirements e.g. chipping, pelletising

• Ability to accept contaminated feedstocks

• Likely transport distances for feedstocks, and the form in which the feedstock

is transported

• We considered the feedstock requirements of 12 different biomass conversion

technologies. We then merged these into 5 groups, with very similar feedstock

requirements

• The supply curves show total available resources suitable for that demand group.

No assumptions are made on the share of resources used for each one, and so

no resource competition between bioenergy demands is considered.

4. UK demands

20

Demand groups

20

Demand

groupTypes of plants Feedstock types and requirements

Large thermal

• Dedicated medium and large

thermal electricity/CHP plant

• Co-firing

• Commercial and industrial scale

heat/CHP

• Most wood resources, energy crops, straw, dry

manures and sewage sludge

• Chipped or dried where necessary

• 50 km UK transport

• Imported chips

Domestic

heat/CHP• Domestic boilers, stoves and CHP

• Most wood resources and energy crops

• Pelletised or as logs

• Imported pellets


Anaerobic

digestion• Anaerobic digestion plants

• All wet resources: wet manures, sewage sludge

and MSW. Landfill gas is not included

• No pretreatment

• 10 km UK transport, zero for sludge

Waste&fuels

• Energy from waste plants using

thermal technologies

• 2nd generation biofuels production

• SNG via gasification

• All resources except wet manures and landfill gas

• Chipped, chopped or dried where necessary

• 50 km UK transport for most, 10km for wastes

• Imported chips

Landfill gas • Gas engines, turbines

• Landfill gas only

• No imports

• No treatment or transport

4. UK demands

21

Example: Large thermal plant – BAU over time

21

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

0 200 400 600 800

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

• This supply curve is

suitable for medium and

large electricity/

CHP/heat plant and co-

firing

• It includes forestry,

arboricultural and wood

processing residues,

energy crops, straw, dry

manures, dried sewage

sludge and clean waste

wood.

• Imported chips, including

50km UK transport are

available at the prices

shown

Year 2008 2010 2015 2020 2030Import price

£/GJ7.28 7.09 5.14 4.41 4.04

4. UK demands

22

Contents

1. Introduction

2. UK supply



5. Conclusions

23

There is a significant potential from UK feedstocks at

reasonable cost

23

• The biomass resource from UK feedstocks could reach around 10% of current UK primary

energy demand by 2030, at a cost of less than £5/GJ

• The resource in earlier years is much smaller, due to a lower resource potential, and each

the sector’s capability to extract or grow the feedstock

• The key factors affecting biomass resources and costs are

• Land availability for energy crops

• Energy crop yields

• Waste generation and management

• Biomass supply and demand should be considered globally, rather than focusing supplies

from within the UK or within the EU

• Global woody biomass resources could potentially be very large, even after demands

for land for food and 1st generation biofuel feedstocks are supplied first, if there is a

fast ramp up of energy crop planting

• However, the global price may be higher than most indigenous UK feedstocks. Prices

could be lower before a global commodity market develops or with lower transport

costs

• Supply curves suitable for different UK demands have been provided, including additional

UK transport and processing costs. Most resources can be used to generate either

electricity, heat, or transport fuels, via a range of conversion technologies.

5. Conclusions

24

Biomass supply curves for the

UK

March 2009

Final report

For DECC

Full slide pack

25

How to use this document

25

• This document gives the approach, results, and supporting data for the biomass supply

analysis conducted during this project

• The main body of the slides is a summary of the results

• Given that we have modelled 4 scenarios across 5 points in time, and many

feedstocks, detailed data is not provided for every permutation in this pack

• For both UK and global supply, we have given two graphs: the BAU scenario in each

year, and all scenarios in 2030

• We also provide supporting slides, summarising the assumptions behind the derivation

of the supply curve for each group of resources

• The annexes give more details on the assumptions for each feedstock, and for the global

demand assessment

• Throughout the document summaries and conclusions are shown in blue boxes to

distinguish them from analysis and supporting assumptions

26

Contents

1. Introduction

2. UK supply

3. Global supply

4. Determining the price of imports


6. Conclusions

7. Annexes

27

Scope and aims

27

• In this project, we were asked to develop supply curves for the UK biomass market, based

on

• a range of UK feedstocks and imported feedstocks

• five points in time: 2008, 2010, 2015, 2020 and 2030

• four scenarios of the supply curve development, varying in their assumptions of energy

and food demand, technology development, policy requirements and sustainability

criteria.

• The supply curves and data will be used by BERR in ongoing modelling and analysis to

• compare relative costs of biomass and other renewable options in the electricity, heat

and transport sectors

• estimate the costs to the UK of the renewables target

• identify the optimal use of limited biomass resource

• assess impacts of technology development

• develop consistent incentives across all sectors

1. Introduction

28

Relationship between key parts of the analysis

28

Scenarios

Global supply

curve

UK supply curve

(without imports)

Global demand

levels

Price of imports to

the UK

UK supply curve

(with imports)

Separate UK

supply curves for

different UK

demands

1. The scenarios are defined first, as these affect UK and global supply of biomass feedstocks

(land use, yields, extractability) and global demand (policy, technically viable end uses)

2. The UK supply curve is then built up, based on the availability and cost of each feedstock

3. The global supply curve for feedstocks that could be imported to the UK, and the level of

global demand for these feedstocks, is used to determine the price of imports

4. The overall UK supply curve can then be broken down in to separate supply curves showing

the resources suitable for conversion by different technologies, to meet different demands

1

2

3

5

1. Introduction

4

29

Introduction to scenarios

29

• Four scenarios were defined. These were designed to represent different potential futures,

and also to give differing impacts on biomass supply and demand.

• The scenarios are:

• Business As Usual (BAU) – a continuation of current trends, without the EU

Renewable Energy Directive (RED). This includes continued trends in use of first

generation biofuels, and in waste diversion from landfill, and modest technology

development in energy crops and second generation biofuel production

• Central RES – As BAU, but with the introduction of the RED. This results in an

increase in EU demand for bioenergy, and sustainability criteria restricting land use for

energy crops

• High Sustainability – here greenhouse gas savings and other sustainability impacts

such as conservation of biodiversity are prioritised. This leads to lower energy demand

through efficiency, strong technology development, and stronger bioenergy demand

side policy.

• High Growth – here energy and food demand increase globally, putting increased

pressure on resources. However, response to this leads to strong technology

development, and a move away from less resource efficient technologies. Some

sustainability constraints are relaxed compared with Central RES

1. Introduction

30

Scenarios summary

BAU Central RES High Sustainability High Growth

UK power, heat and

fuels policy

Existing as in White

Paper, constant to

2030

To meet 2020 RED.

Constant generation

level after

Extended RED to

2030

To meet 2020 RED.

Constant generation

level after

Global bioenergy

policyCurrent policy Current policy + RED

Extended RED to

2030 + Increased 2G

biofuels targets

globally

RED + Increased 2G

biofuels targets

globally

Global food

demandCentral projection Central projection Central projection Increased projection

Global energy

demandIEA BAU projection IEA BAU projection

IEA BAU projections

-12.5%

IEA BAU projections

+12.5%

Land use for 1G

biofuel feedstocksContinued expansion Continued expansion Reduced expansion Increased expansion

Land use for

energy cropsCentral Restricted Restricted Central

UK waste

generation Current trend Current trend

Growth rates reduced

by 0.75%

Growth rates

increased by 0.25%

Technology

development and

resource extraction

Mid Mid High High

30

1. Introduction

31

Deriving supply curves – feedstocks considered

31

UK feedstocks

Energy crops Short rotation coppice willow or poplar, and miscanthus

Crop residues Straw from wheat and oil seed rape

Stemwood Hardwood and softwood tree trunks


Sawmill co-product Wood chips, sawdust and bark made when sawing stemwood

Arboricultural arisings Stemwood, wood chips, branches and foliage from municipal tree surgery operations

Waste wood Clean and contaminated waste wood

Organic waste Paper/card, food/kitchen, garden/plant and textiles wastes

Sewage sludge From Waste Water Treatment Works

Animal manures Manures and slurries from cattle, pigs, sheep and poultry

Landfill gas Captured gases from decomposing biodegradable waste in landfill sites

Global feedstocks

Energy crops Woody short rotation crops, such as eucalyptus and willow (species not specified)


Wood processing residues Sawmill co-product and waste wood from the wood processing industry

Others – considered in the annex only, not included in supply curves

First generation biofuels Ethanol from sugar and starch crops, and biodiesel from oil crops

Algae Oil and biomass from photosynthetic algae

1. Introduction

• The scope of feedstocks considered was agreed at the start of the project, based on consideration of the

mostly likely UK and imported sources in the long term

32

Deriving supply curves – resource

32

• We followed a broadly similar approach to estimating the potential for each resource. In most cases, this

takes the form of

Potential

minus technical constraints

minus environmental constraints

minus competing demands for the resource

minus an availability factor for supply constraints e.g. planting rate, extraction ramp up

• The competing demand for the resource are assumed to be supplied before any use for bioenergy. This

means:

• for energy crops, land needs for food are supplied first

• for wood processing residues, the wood product industry's needs are supplied first

• for straw, feed and bedding needs are supplied first

• for wastes, recycling is supplied first

• The competing demands change over time, and between scenarios

• Alternative disposal routes for wastes e.g. composting, are not treated as competing demands

1. Introduction

33

Deriving supply curves – cost

33

• As competing demands for the resource are supplied first, for most feedstocks any

remaining resource is available for bioenergy at the cost of production/extraction. This

means that there is no competition with the competing demand on the basis of price.

• The exceptions to this are:

• Energy crops – a cost of production is used, which includes a land rent (price) which

takes into account all competing uses of land (i.e. not only the use of land for food,

which has already been excluded)

• Imports – a global supply curve based on costs, as above, is used with global demand

levels to find the global price. This is assumed to be the price at which the UK can

import, i.e. the UK is assumed to be a price taker

• An alternative approach would be to include price competition with competing uses.

However, this would entail deriving demand curves for each competing demand for each

feedstock, in many different sector, which would be difficult and time-consuming, particularly

at a global level, and in future years.

1. Introduction

34

Contents

1. Introduction

2. UK supply

3. Global supply



6. Conclusions

7. Annexes

35

Introduction to biomass supply curves

35

Cost

Quantity

Negative cost feedstocks

are those for which there

would be a fee to dispose

of them

Total available

resource

Positive cost feedstocks

• This can be for one feedstock, or

can be the sum of the supply curves

for many different types of biomass

feedstocks

2. UK supply

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

36

UK supply curve for all feedstocks - BAU scenario over time

36

2. UK supply

Box done

• The potential bioenergy resource is large. UK primary energy demand is

currently around 10 EJ (10,000 PJ)

• It increases significantly to 2030, mainly due to expansion in energy crops

and increased ability to extract other feedstocks

• There is a large resource at negative cost due to avoided gate fees:

organic MSW, sewage sludge and waste wood

• Positive cost feedstocks include straw, forestry residues, stemwood and

sawmill co-product – but these are small compared with the potentially

large energy crop resource

• Note that these costs do not include transport to the plant, or

preprocessing: this is added separately for each demand in section 5

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ)

Supply (PJ)

BAU 2030 Wastes

BAU 2030 Energy crops

BAU 2030 Forestry

BAU 2030 Agricultural

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

0 100 200 300 400 500 600

Cost

(£/G

J) Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

0 100 200 300 400 500 600

Cost

(£/G

J) Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

-20.00

-15.00

-10.00

-5.00

0.00

5.00

10.00

0 100 200 300 400 500 600

Cost

(£/G

J) Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

37

UK supply curve for all feedstocks - BAU scenario 2030

37

2. UK supply

Energy crops-8.0

-7.0

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

0 200 400

Co

st (£

/GJ)

Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

Wastes

ForestryAgriculturalThe supply curve for each of the four

categories is given in the following slides

• The overall supply curve can be disaggregated into four categories of feedstocks

• These four categories are for explanation and comparison – a different split based on potential end uses

will be given in section 5 to feed into demand assessment

0.00

0.50

1.00

1.50

2.00

2.50

3.00

3.50

4.00

4.50

5.00

0 100 200 300 400 500 600

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

38

Energy crops are the largest potential resource

38

• Energy crops are the largest of the

potential UK resources in 2030.

These are planted on land released

from food production, and on

pasture land

• The model assumes that on each

area of land, either SRC willow,

SRC poplar, or miscanthus is

planted, depending on their relative

production costs

• The resource increases over time

as more land becomes available,

and as more of this area is planted.

• The resource is significantly limited

by planting rates until the mid 2020s

(see next slide). After this it is

limited by land area – 2.2Mha in

2030

• Costs decrease to 2030 with yield

increases, but remain predominantly

at £2-3.5 /GJ (£35-60 /odt), without

subsidies

2. UK supply

Note: costs shown are for chipped

SRC and baled miscanthus

39

Energy crops are limited by planting rates

39

Add planting

rates graph

DONE

2. UK supply

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 100 200 300 400 500 600

Co

st (£

/GJ)

Supply (PJ)

UK energy crops: influence of planting rates on BAU over time

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

BAU 2008 no planting constraints





0.0

0.5

1.0

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0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






0.0

0.5

1.0

1.5

2.0

2.5

3.0

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4.0

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0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






• The dotted lines show the energy

crop potential assuming all available

land area is planted in each year

• The solid lines show the effect of

planting rates: these significantly

limit the potential until after 2020

• In the BAU scenario and High

Growth scenarios, the 2030

potential is still limited by the

planting rate

• In the Central RES and High

Sustainability scenarios, the full

available area is planted from 2022,

as less land is available

• Note that a spread of land types is

planted each year – we do not

assume that the best or worst land

is planted first

0.0

1.0

2.0

3.0

4.0

5.0

0 100 200 300 400 500 600

Co

st (£

/GJ)

Supply (PJ)

BAU 2008

BAU 2008 no planting constraintsBAU 2010

40

Reducing the maximum planting rate reduces 2030

potential significantly in some scenarios

40

2. UK supply

• In this graph, the maximum planting rate of

150kha/yr is reduced to 100kha/yr

• Before 2016, the results are the same as

the previous slide, as the planting rate is

still ramping up

• In all scenarios the resource from 2016 to

mid 2020s is constrained by the planting

rate, with the lower planting rate reducing

the potential by around 25% in 2020

• Changing the maximum planting rate does

not affect High Sustainability and Central

RES to 2030 because they are then

constrained by the available land area.

• BAU and High Growth are constrained by

planting rates, and so reducing the planting

rate reduces the potential in 2030 by

167PJ, or 31% under BAU, and by 208PJ,

or 31% in High Growth.

• This reduces total BAU potential from

around 1,150PJ to around 1,000PJ

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






Slide added March 2009

41

Energy crop subsidies

41

• Energy crop subsidies have

been included in the

dashed curves

• Energy crop scheme

establishment grants

of £1000 /ha for SRC

and £800 /ha for

miscanthus

• EU area payments of

£30/ha/yr

• These reduce the costs of

energy crops by around

£0.6/GJ under the BAU

scenario

2. UK supply

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

BAU 2008 with subsidies





0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 100 200 300 400 500 600

Co

st (

£/G

J)

Supply (PJ)

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






42

Energy crops – summary of assumptions

Resource

• Energy crops are planted on arable and pasture land no longer needed for food production. Projections of this

for 2030 were taken from scenarios from the EU Refuel project, and a linear ramp up to this assumed based on

Refuel and ADAS data on current land availability.

• All abandoned arable land is assumed to be available (1.1mha in BAU and Central RES in 2030)

• In BAU and High Growth scenarios, all abandoned pasture is used (1.2mha in 2030), assuming that

planting is no-till, to avoid land use change emissions. In the other scenarios, biodiversity restrictions are

applied (10% of land is used in Central RES and High Sustainability)

• Planting rate: Current area of 8,000ha is assumed to increase by 1000ha in 2010, with the annual rate then

doubling each year until it reaches a maximum of 150,000 ha/year in 2017

• Yields from a model developed by Pepinster (2008), based on spatial models from Southampton University and

Rothamsted Research. This includes distribution of energy crop yields across England, on arable and improved

grassland, assuming planting of the highest yielding SRC willow, SRC poplar, or miscanthus on each grid

square

• Yields were increased by 1% or 2% p.a. depending on scenario

Costs

• Costs are calculated using a land rent (i.e. a price of land that takes into account competing land uses).

However, effects on the price as a result of competing uses for the product are not considered

• 2008 energy crop cost from Alberici (2008), based on a review of literature and industry views on energy crop

costs, adjusted to remove subsidies where necessary. This considers the land rent and production cost on each

grid square

• Future cost reduction was assumed to be a function of yield increase only, not reduction in management costs

42

2. UK supply

A full list of data sources and

assumptions is given in Annex A

-8.0

-7.0

-6.0

-5.0

-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

0 200 400

Co

st (£

/GJ)

Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

43

Wastes are a large resource at negative cost

43

2. UK supply

• Wastes are: wood wastes, paper/card, food/kitchen, garden/plant, textiles,

sewage sludge and landfill gas

• Resources currently going to alternative disposal routes (landfill, incineration,

AD or composting) are used, but not those being recycled

• The resource is large, with landfill gas being the largest resource in 2008,

when most other resources are limited by separability. Ramp up in the ability

to separate wastes leads to a large wood waste resource by 2015, and large

resources of other wastes by 2030

• Most of the resource is at negative cost, as a result of the gate fee for waste

disposal (£21/t in all scenarios), although landfill tax is not included. The

lowest energy content wastes have the lowest cost, as gate fees are charged

per tonne

44

Costs decrease if landfill tax is included

44

2. UK supply

-20.0

-15.0

-10.0

-5.0

0.0

0 200 400

Co

st (£

/GJ)

Supply (PJ)


BAU 2010

BAU 2015

BAU 2020

BAU 2030

• Here, avoided landfill tax is also included in the resource costs. The

landfill tax increases from £24 to £48 by 2011 in all scenarios

• In High Sustainability and High Growth the current landfill tax escalator

of £8/yr is continued to 2030, significantly reducing the costs. This

reduces the cost of the lowest cost resources by around £5/GJ by 2030

• Including landfill tax changes the cost of each resource, and also the

merit order of the resources - wet food and garden wastes become

lower cost than sewage sludge

45

Wastes – summary of assumptions

Wood

wastes

• Resource from Municipal Solid Waste (MSW), Commercial & Industrial (C&I) and Construction & Demolition (C&D) is

given by WRAP (2005). Sector growth rates from the Defra Waste Strategy were then used to forecast total arisings.

Growth rates were reduced by 0.75% for High Sustainability, and increased by 0.25% for High Growth

• One third of the total resource is clean wood, the rest is contaminated (WRAP 2008)

• Competing uses for clean wood: use by the wood panel industry increases up to 2010, and remains flat afterwards in

BAU and Central RES (WRAP 2008). Under High scenarios, wood panel industry use increases to 2013

• Currently, 15% is separable for energy recovery, increasing to 100% by 2020 in BAU and Central RES, or by 2015 in

High Sustainability and High Growth

• Costs: avoided landfill costs for contaminated wood, gate fee of £8 /t for reprocessing for clean wood

Paper/card

Garden/plant

Food/kitchen

Textiles

• Resource from MSW, C&I arisings from ERM Golder 2006. Growth rates from the Defra Waste Strategy were then used

to forecast future total arisings. Rates were reduced by 0.75% for High Sustainability, and increased by 0.25% for High

Growth

• Recycled material was considered not to be available for energy. Increases in recycling volumes over time from WRAP

were used for BAU and Central RES. These were scaled up by extra growth in arisings in High Growth, but held the

same for High Sustainability even with lower arisings.

• Current separation is 48% for paper/card and 19% for textiles (for recycling); 17% for food/kitchen and 26% for

garden/plant (AD/composting). Separability is assumed to increase above rates of recycling/composting by 2% a year

under BAU and Central RES, or 4% a year under High scenarios, until a 90% maximum is reached, based on

international experience (ERM Golder)

• Costs: avoided landfill costs

Sewage

sludge

• Arisings increase to 2010, then slower annual growth with population afterwards (National Grid)

• Extraction rates: 90% is extractable as this is already used for energy via AD and incineration, 100% by 2010

• Costs: cost of dewatering, minus the gate fee for disposal/AD treatment of £45/tonne (Strathclyde University)

Landfill gas

• The above biodegradable wastes are available for energy if separable. If they are used for energy, they will not be

landfilled, and so will not contribute to future LFG generation. As a simplification, we have assumed no new waste is

landfilled from 2008. Gas production from existing landfill follows an exponential decay (Enviros), assuming no new

capture installations.

• Zero costs assumed

45

2. UK supply



-4.0

-3.0

-2.0

-1.0

0.0

1.0

2.0

3.0

4.0

0 20 40 60 80

Co

st (£

/GJ)

Supply (PJ)

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

46

Forestry resources are relatively small, but are low cost

46

• Forestry resources are: arboricultural arisings, sawmill co-products, forestry

residues, and soft and hard stemwood

• The resource is small, but increases up to a peak in 2020 as forests reach maturity

and forest residue collection increases

• The largest potential resource is currently arboricultural arisings (6.1 PJ), but this is

quickly overtaken by forestry residues, which grow to 19 PJ by 2020

• The costs of most feedstocks are a result of collection and chipping only

• Some arboricultural arisings are available at negative costs, as they are currently

landfilled

2. UK supply

47

Forestry – summary of assumptions

Forestry

residues

• The resource consists of poor quality stemwood, branches and tips, with environmental, biological and

operational constraints (McKay, 2003). Additional resources from 1M odt/yr of under-managed English

forest will be available by 2020.

• Long tree growth times mean fixed forecasts regardless of scenario

• None of this resource is currently extracted. Extraction is assumed to be 10% in 2010, 75% in 2015 (50%

for BAU and Central RES), and 100% in 2020 for all scenarios

• Costs: forwarding and chipping at the roadside

Stemwood

• The resource to 2025 is taken from the Forestry Commission softwood forecast, extrapolated to 2030

• Competing uses: Sawmills always take the largest timber. Other competing uses remain at current volumes.

• Costs: tree felling and extraction

Sawmill

co-product

• Sawmills use the largest timber, as above. 51% of this becomes co-product – sawdust, chips and bark

• The competing uses are the panelboard industry, paper and pulp, exports and fencing. These are all

assumed to take the same volume in the future as they do now, under all scenarios

• Costs are very low: handling and storage at the sawmill

Arboricultural

arisings

• Arboricultural arisings are stemwood, wood chips, branches and foliage from municipal tree surgery

operations

• The resource was taken from a survey by McKay (2003), and kept unchanged over time and scenario

• The only competing use considered was the wood industry, using 16% of the resource. The remainder, that

is currently used for energy, landfilled or left on site, can be used

• 78% of the resource can be collected now (landfilled and woodfuel), increasing to100% by 2010

• Costs: collection and handling, or avoided landfill costs for material that is currently landfilled.

47

2. UK supply



48

Agricultural residues are limited by collection

48

• Agriculture feedstocks are:

wet and dry manures, and

straw

• The resource is reasonably

large, but limited before

2020 as a result of the slow

build up of collection of the

resources

• The zero cost resource is

manure. The slight

decrease in resource

between 2020 and 2030 is

a result of the livestock

herd decreasing

• The straw resource (69 PJ

in 2030) is available

between a cost of 2.3-4.5

£/GJ (38-76 £/odt)

2. UK supply

0.0

0.5

1.0

1.5

2.0

2.5

3.0

3.5

4.0

4.5

5.0

0 50 100 150 200

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

49

Agriculture – summary of assumptions

Straw

• The resource is based on a CSL study (2008) which considers the UK straw resource from all crops, taking into

account the extractability from the field, and competing uses such as feed and bedding. The bulk of the

remaining resource is oil seed rape straw, with some wheat straw. This is unchanged over time

• This is limited by the assumed ramp up of additional straw collection: 10% of this can be collected now, 20% in

2010, 50% in 2015, and 100% from 2020 in all scenarios. This rate is relatively slow, as oil seed rape straw is

not currently extracted in large quantities , and is more difficult to handle than wheat and barley straw.

• Cost: a four point cost curve was derived from ADAS (2008) on the price needed to persuade farmers to extract

additional residues, based on harvesting costs, costs of fertiliser replacement and a profit margin

Manure

• The resource was calculated based on ADAS livestock numbers for all types of livestock. These were combined

with excreta rates, time housed and manure management method

• Some resource is excluded – from farms where manure is spread to land without storage

• Extraction rates were considered to be 18% for dry poultry litter now, 50% in 2010 and 100% in 2015. For wet

manures, the rate was assumed to be lower, at 1% now, 10% in 2010, 50% in 2015 and 100% in 2020

• Costs: Since digestate has a higher nutrient value than manure, farmers are likely to provide manure at zero

cost in exchange for returned digestate – which needs to be spread to land

49

2. UK supply



-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ) Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

50

UK supply curve for all feedstocks - all scenarios in 2030

50

2. UK supply

• The total potential is affected strongly by the energy crop potential: the High

Growth scenario has a large land area and highest yields. This potential is

reduced in the BAU scenario as a result of lower crop yields, and in the

Central RES and High Sustainability scenarios as a result of greater

constraints on the use of abandoned pasture land

• Energy crop potentials in both BAU and High Growth scenarios remain

constrained in 2030 by planting rates

• Energy crop costs are lower in the High Sustainability and High Growth

scenarios, as a result of higher yields

• Potential from wastes is the same under BAU and Central RES scenarios, is

reduced in High Sustainability due to lower volumes of waste generation, and

is increased under High Growth

51

Contents

1. Introduction

2. UK supply

3. Global supply



6. Conclusions

7. Annexes

0.0

2.0

4.0

6.0

8.0

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12.0

0 50 100 150 200 250

Co

st (

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J)

Supply (EJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

52

Global supply curve for all feedstocks - BAU over time

52

• Global feedstocks are forestry and

wood processing residues, and

energy crops - those that are

most likely to be imported in large

quantities. We have termed these

‘woody biomass’ for the rest of

this report

• Forestry and wood processing

residues are small (7 EJ) in 2030

in comparison with the energy

crop resource (196 EJ)

• The resource increases to 2030

with energy crop yield increases

and planted area (see next slide)

• Costs include processing required

for transport, and an assumed

average distance for road

transport in the country of origin

and international shipping. They

do not include transport within the

UK

3. Global supply

0.0

2.0

4.0

6.0

8.0

10.0

12.0

0 50 100 150 200 250

Co

st (

£/G

J)

Supply (EJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

0.0

2.0

4.0

6.0

8.0

10.0

12.0

0 50 100 150 200 250

Co

st (

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J)

Supply (EJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

53

Planting rates have the greatest impact on global resources

53

Graph done –

check box

3. Global supply

0.0

2.0

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6.0

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st (

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J)

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BAU Global supply curves: influence of planting rates

BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






0.0

2.0

4.0

6.0

8.0

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0 100 200 300

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st (

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J)

Supply (EJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






0.0

2.0

4.0

6.0

8.0

10.0

12.0

0 100 200 300

Co

st (

£/G

J)

Supply (EJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030






• The unconstrained energy crop

potential, as shown by the dashed

lines, increases over time as more

land area becomes available, and

yields increase

• When planting rates are

considered, the available resource

is significantly reduced, as shown

by the solid lines

• Planting rates are initially low, and

it takes until 2017 for the

maximum planting rate of

48Mha/yr to be reached, as the

sector ramps up

• In all scenarios, the 2030 potential

remains limited by the planting

rate

• Most of the planted area is

abandoned agricultural land, with

non-agricultural land only being

planted in the late 2020s

54

Global energy crops – assumptions

Resource

Data is based on a global analysis from Hoogwijk (2008), which:

• considers the potential from woody energy crops (e.g. willow, poplar, eucalyptus)

• gives the potential in 2050 for 4 IPCC-derived scenarios, of which 2 are used as a basis for our scenarios

• considers two main types of Available Area

• abandoned agricultural land – released as agricultural technology and food demand changes.

• non-agricultural land – extensive grassland, and abandoned pasture, excluding nature reserves.

We then estimated the potential resource to 2030 by:

• backcasting Hoogwijk’s available area and productivity from 2050 to 1995 to give a 1995 potential

• forecasting to 2030, using

• available abandoned agricultural area projections from Hoogwijk, modified to remove land needed for 1G

biofuels, and to remove extra land needed for food in the High Growth scenario

• a proportion of the (constant) non-agricultural land area: 50% in BAU and High Growth, and 10% in Central

RES and High Sustainability, based on Hoogwijk’s assumptions.

• management factors adapted from Hoogwijk to reflect our scenarios

The resource is then limited by a planting rate

• A global planting rate was estimated by scaling up the UK planting rate in proportion to the relative arable areas.

The 13Mha currently planted increases by 0.32Mha in 2009, with the rate then doubling each year until 2017 when

the maximum planting rate of 48Mha/yr is reached (48Mha is 3% of current global arable area).

• We assume that abandoned agricultural land is planted first.

Cost

• Energy crop costs reduce with increased yield and improved management over time.

• Hoogwijk gives supply cost curves for each land type in 2050, up to a cost of $5/GJ. We assumed that the

distribution of costs across the resource would be the same in intervening years, and therefore derived a new

supply curve using our resource and costs data.

• We assume that a spread of land is planted in each year, rather than the cheapest being planted first.

54

3. Global supply


assumptions is given in Annex B

55

Global energy crops – scenario variation

55


Hoogwijk’s

Scenario

A1 Global-Economic

Orientation

A1 Global-Economic

Orientation

B1 Global-Socio-

environmental

A1 Global-Economic

Orientation

High Meat Demand

Intensive Agriculture

Medium Population

Growth – 8.3 billion in

2030

High Meat Demand


Medium Population


2030

Low Meat Demand

Intensive Agriculture –

but less fertilisation

Medium Population


2030

High Meat Demand


Medium Population


2030

Adjusted food

demandNone None

None – already in B1

scenario above

Agricultural area factored

up according to UN high

population projection –

8.9 billion in 2030

Adjusted

Management

Factor

Annual growth: 1.4%

Maximum: 1.3

Annual growth: 1.4%

Maximum: 1.3

Annual growth: 1.6%

Maximum: 1.5

Annual growth: 1.6%

Maximum: 1.5

Land types

possible

Abandoned Arable

(Less 1G biofuel land)

+ 50% of Non-

agricultural Land

Abandoned Arable


+ 10% of Non-

agricultural Land

Abandoned Arable


+ 10% of Non-

agricultural Land

Abandoned Arable


+ 50% of Non-

agricultural Land

3. Global supply



56

Global wood residues – assumptions

Wood

processing

residues

• Residue generation is directly proportional to wood product manufacture, which we projected

using the recent trend in global per capita demand for wood products.

• Residue generation factors were then applied

• Pulp and panel industry raw material requirements are supplied first. These also follow the

recent trend in per capita demand for pulp and paper with a residue demand coefficient.

• We assumed that all of the remaining resource is available now, in all scenarios – i.e. there is

no restriction on extraction

• A small collection cost is assumed, consistent with UK costs

Forestry

residues

• Residue production is proportional to roundwood production. Future demand for roundwood

follows the recent trend in global per capita roundwood demand.

• To this, we applied a sustainable residue harvest ratio – this is the ratio of residues (tops,

branches and undergrowth) to stemwood that can be removed sustainably. Values of 0.1-0.3

are used, with higher values for the High Growth scenario assuming that the forest is

fertilised, e.g. through ash recycling, rather than through leaving the residues on the ground

• There are no competing uses – current collection and use is primarily for energy

• Currently, around 7% of the total residues, which is equivalent to 56% of the sustainable

harvest (or 28% in High Growth), are extracted. We assumed that this increases to 100% by

2020 in each scenario

• Costs are for forwarding, roadside chipping and management

56

3. Global supply



57

Global processing and transport assumptions

Processing

• Each feedstock must be in a suitable form for transport

• Wood processing residues:

• chips do not need further processing

• sawdust is pelletised

• other loose material is chipped at a centralised plant

• Forestry resides are already chipped at roadside

• Energy crops are in the form of willow and eucalyptus stems, and are chipped

International

transport

• Wood processing residues originate at a plant/sawmill, forestry residues at the nearest

roadside, whereas energy crop costs already include 50km road transport to a centralised point

(included in Hoogwijk model)

• We then added an estimated average transport distance for global woody biomass resources,

as set out below. In reality, many resources would be used close to the source of production,

and many transported much further.

• After any necessary processing, each resource is transported a distance of 200km by

road in the country of origin.

• Costs for sea transport are then added for a distance of 1500km.

57

3. Global supply


assumptions is given in Annex D

58

Global curve - scenarios in 2030

58

3. Global supply

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

0 50 100 150 200 250 300

Co

st (

£/G

J)

Supply (EJ)

BAU 2030

Central RES 2030


High growth 2030

• The main difference between the

scenarios is the energy crop resource

• High Sustainability has the greatest

potential and the lowest costs as a

result of

• more abandoned agricultural land

• potentially better quality agricultural

land may be abandoned, due to

changing diets (e.g. lower meat

consumption) under Hoogwijk’s B1

scenario rather than the A1

scenario

• high energy crop management

factor

• In High Growth, extra food demand

requires more agricultural area, and

hence less is available for energy

crops, and poorer non agricultural

land is used

59

Contents

1. Introduction

2. UK supply

3. Global supply



6. Conclusions

7. Annexes

60

Estimating global demand for woody biomass

60

• The previous section gave the global supply of woody biomass (forestry and wood processing residues,

and energy crops)

• We have estimated the global demand for woody biomass for energy under the different scenarios, to

2030

• This involves making a large number of assumptions, for many of which there is very limited

supporting data

• We have started with IEA projections for biomass and waste demand and biofuels demand, and

then estimated how much of this is from woody biomass in each sector, based on current data and

likely trends

• No non-energy demands e.g. for chemicals and materials production, are included

• A summary of these assumptions is given in the annex

• Using these global demand results, we can use the global supply curve to find the global price

Scenario 2008 2010 2015 2020 2030

BAU 6.4 6.8 7.8 9.9 15.1

Central RES 6.4 7.1 8.9 11.7 16.3

High Sustainability 6.4 7.0 8.8 11.6 16.2

High Growth 6.4 7.1 9.5 13.3 20.1

Woody biomass demand for energy (EJ)


assumptions is given in Annex C

4. Imports

0.0

2.0

4.0

6.0

8.0

10.0

12.0

0 50 100 150 200 250

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st (

£/G

J)

Supply (EJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

61

Deriving import price from global supply and demand

61

• If we know the global demand for

woody biomass in a particular year, we

can use the global supply curve to

determine the cost of supplying that

demand, as shown here

• In BAU 2030, the global woody biomass

demand of 15 EJ gives a global price of

£3.48 /GJ (equivalent to £63 /odt)

• In BAU 2010, the global woody biomass

demand of 6.8 EJ gives a global price

of £6.52 /GJ (equivalent to £117 /odt)

• If the UK is assumed to be a price taker,

this is the price at which imports are

available to the UK

• Note that energy crops must be planted

in order to meet the global demand

• Note that as before, the feedstock

import price includes processing and

international transport, but no transport

within the UK – therefore is equivalent

to the price at a UK portGlobal woody

biomass demand

in 2030

4. Imports

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

62

Under BAU, import prices fall over time, but remain expensive

62

• The UK could import significant volumes of woody biomass - more than enough to supply

UK demand – at the global market price

• However, imports would be high cost

• In 2010, import prices are more expensive than all other UK resources

• In 2030, imports are only cheaper than the most expensive straw and energy crops

• The 2010 price given is comparable with current pellet import prices of €135-155/tonne, or

around £7.2/ GJ (European Pellet Centre for March 2008)

• These results depend heavily on the transport assumptions made, as transport adds

around £2/GJ to most global feedstock costs

2030 import price £3.48 /GJ2010 import price: £6.52 /GJ

4. Imports

-8.0

-6.0

-4.0

-2.0

0.0

2.0

4.0

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ) Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

63

This remains the case under other scenarios in 2030

63

BAU, Central RES and High Growth import

price £3.48 /GJ

• Under BAU, Central RES and High Growth the import price of 3.48

£/GJ is more expensive than nearly all UK energy crops and straw

• Under High Sustainability, the import price is lower at 3.17 £/GJ, as

the cost of the first tranche of global energy crops is cheaper.

However, UK energy crops are also cheaper, hence imports are

still more expensive than 95% of the UK’s resources

• Again, these results depend heavily on the transport assumptions

made, as transport adds around £2/GJ to most global feedstock

costs

High Sustainability import price £3.13 /GJ

4. Imports

64

Uncertainties in import price calculations

64

• The principal uncertainties in deriving the global supply curve and global demand to get the price of

imports, and in assessing the relationship with UK resource costs are:

• Global demand estimates – these are necessarily uncertain, as there is poor data availability on the

current use of each feedstock, and on likely future demand

• Yield and cost assumptions for energy crops - Different assumptions are made in the global energy

crop model, as this was related to Hoogwijk’s model, compared with the UK approach.

• Manipulation of Hoogwijk’s model – we modified Hoogwijk’s model by changing management factors

and backcasting, without access to the underlying model.

• 1G biofuels demand – land needed for 1G biofuel crops reduces the land area for energy crops, and

therefore has a large effect on potential. 1G biofuels are also assumed to be grown on a spread of

the economically viable land. The potentials seen in some scenarios rely on a switch away from 1G

production

• Planting assumptions – the most economically viable land is not assumed to be planted first, rather

a mix of the economically viable land (less than $5/GJ) is planted in each year. Since the most

economically viable land is distributed worldwide, this assumption is more reasonable than

assuming that the very cheapest land is planted first. Also, abandoned agricultural land is assumed

to be planted before non-agricultural land

• Transport assumptions – we assumed an average transport distance for all globally traded

feedstocks, but this could vary considerably. Furthermore, shipping costs can vary considerably e.g.

depending on oil price

• Import prices could be lower than this before a global commodity market develops, it may be possible to

access lower cost feedstocks

4. Imports

65

Contents

1. Introduction

2. UK supply

3. Global supply



6. Conclusions

7. Annexes

66

Building appropriate supply curves for different demands

66

• The results of this work will be used as an input to supply and demand modelling for biomass and other

energy technologies in the UK

• Deciding which feedstocks to combine on supply curves for biomass conversion can be complex, and

depends on how they will be used. Here we provide supply curves suitable for different UK bioenergy

demands

• All of the resources on the supply curve must be suitable feedstocks for the demand being considered,

and have similar costs of conversion. This is complicated by the characteristics and requirements of

conversion technologies in terms of

• Need for wet or dry feedstocks

• Sizing or other pretreatment requirements e.g. chipping, pelletising

• Ability to accept contaminated feedstocks

• Likely transport distances for feedstocks, and the form in which the feedstock is transported

• We considered the feedstock requirements of 12 different biomass conversion technologies. We then

merged these into 5 groups, where each group has very similar feedstock requirements (see next slide)

• The supply curve for each demand group is given in the following slides in this section. It is important to

note that the supply curves show total available resources suitable for that demand group. No

assumptions are made on the share of resources that can be used for each demand group, and so no

resource competition between bioenergy demands is considered.

5. UK demands

67

Demand groups

67

Demand group Types of plants Feedstock types and requirements

Large thermal

• Dedicated medium and large thermal

electricity/CHP plant

• Co-firing

• Commercial and industrial scale

heat/CHP

• Most wood resources, energy crops, straw, dry manures

and sewage sludge

• Chipped or dried where necessary


• Imported chips

Domestic

heat/CHP• Domestic boilers, stoves and CHP

• Most wood resources and energy crops

• Pelletised, except for the proportion of stemwood and

arboricultural arisings that are logs, and can be used directly

• Imported pellets


Anaerobic

digestion• Anaerobic digestion plants

• All wet resources: wet manures, sewage sludge and MSW.

Landfill gas is not included

• No pretreatment

• 10 km UK transport, zero for sludge

Waste/fuels

• Energy from waste plants using thermal

technologies

• Second generation biofuels production:

lignocellulosic ethanol and FT biodiesel

• Synthetic natural gas via gasification

• All resources except wet manures and landfill gas

• Chipped or chopped where necessary, plus drying for

sewage sludge

• 50 km UK transport for most, 10km for wastes

• Imported chips

Landfill gas • Gas engines, turbines

• Landfill gas only

• No imports

• No treatment or transport


assumptions is given in Annex D

5. UK demands

68

Large thermal plant – BAU over time

68

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

0 200 400 600 800

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

• This supply curve is suitable for

• Dedicated medium and large

thermal electricity/CHP plant

• Co-firing

• Commercial and industrial

scale heat/CHP

• It includes forestry, arboricultural and

wood processing residues, energy

crops, straw, dry manures, dried

sewage sludge and clean waste

wood.

• These are chipped or dried where

necessary, and 50 km UK transport is

added for all resources

• Imported chips, including 50km UK

transport are available at the prices

shown

• Note that other potential co-firing

feedstocks such as vegetable oils

and other agricultural residues (olive

pits, palm kernel expeller etc) are not

included. The availability and price of

residues in the future will be highly

dependent on food production and

their use in the country of origin.

Year 2008 2010 2015 2020 2030

Import price £/GJ 7.28 7.09 5.14 4.41 4.04

5. UK demands

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

0 200 400 600 800 1,000

Co

st (£

/GJ)

Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

69

Large thermal plant – all scenarios in 2030

69


suitable for

• Dedicated medium

and large thermal

electricity/CHP plant

• Co-firing

• Commercial and

industrial scale

heat/CHP




energy crops, straw, dry

manures, dried sewage

sludge and clean waste

wood.

• These are chipped or

dried where necessary,

and 50 km UK transport

is added for all

resources

• Imported chips,

including 50km UK

transport are available

at the prices shown

ScenarioImport

price £/GJ

BAU 4.04

Central RES 4.04

High Sustainability 3.69

High Growth 4.04

5. UK demands

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

0 200 400 600 800

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

70

Domestic heat/CHP – BAU over time

70

• This supply curve is suitable

for domestic boilers, stoves

and CHP



processing residues, (except

bark) energy crops, and clean

waste wood.

• All feedstocks are pelletised,

except for the proportion of

stemwood and arboricultural

arisings that are logs, and so

can be used directly

• 50 km UK transport is added

for all resources

• We assume that the UK can

import pellets at the same price

as other global imports.

Imported pellets, including


available at the prices shown.

Year 2008 2010 2015 2020 2030

Import price £/GJ 6.90 6.71 4.76 4.03 3.66

5. UK demands

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

4.00

5.00

6.00

0 200 400 600 800

Co

st (£

/GJ)

Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

71

Domestic heat/CHP – all scenarios in 2030

71

ScenarioImport

price £/GJ

BAU 3.66

Central RES 3.66


High Growth 3.66


suitable for domestic

boilers, stoves and CHP




(except bark) energy

crops, and clean waste

wood

• All feedstocks are

pelletised, except for

the proportion of

stemwood and

arboricultural arisings

that are logs, and so

can be used directly

• 50 km UK transport is

added for all resources

• We assume that the UK

can import pellets at the

same price as other

global imports. Imported

pellets, including 50km

UK transport are


shown.

5. UK demands

72

AD – BAU over time

72

-8.00

-6.00

-4.00

-2.00

0.00

2.00

4.00

0 100 200 300 400

Co

st (£

/GJ)

Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030


anaerobic digestion plants.

• All wet resources are included: wet

manures, sewage sludge and

MSW.

• Landfill gas is not included

• Sludge is dewatered

• 10 km UK transport is added for

wastes and manures, zero for

sludge

• No imports are included

• It is also possible to use energy

crops for AD, however, these are

crops such as silage maize, rather

than the predominantly woody

crops modelled here

• Silage maize is cheaper than the

energy crops modelled here, at a

typical price of £25 /t, with 30%

moisture content (Nix 2007). This

equates to £1.98/GJ. The price

range can be as large as £1.04-

3.37/GJ

5. UK demands

73

AD – all scenarios in 2030

73

-7.00

-6.00

-5.00

-4.00

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

0 50 100 150 200 250 300 350

Co

st (£

/GJ)

Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

-7.00

-6.00

-5.00

-4.00

-3.00

-2.00

-1.00

0.00

1.00

2.00

3.00

0 50 100 150 200 250 300 350

Co

st (£

/GJ)

Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

• This supply curve is suitable for anaerobic digestion plants.

• All wet resources are included: wet manures, sewage sludge

and MSW.

• Landfill gas is not included

• Sludge is dewatered

• 10 km UK transport is added for wastes and manures, zero

for sludge

• No imports are included

5. UK demands

-10.00

-8.00

-6.00

-4.00

-2.00

0.00

2.00

4.00

6.00

0 500 1,000

Co

st (£

/GJ) Supply (PJ)


BAU 2008

BAU 2010

BAU 2015

BAU 2020

BAU 2030

74

Waste & Fuels – BAU over time

74


• Energy from waste plants

using thermal technologies

• Second generation biofuels

production: lignocellulosic

ethanol and FT biodiesel

• Synthetic natural gas via

gasification

• It includes all resources except wet

manures and landfill gas

• These are chipped, chopped or

dried where necessary

• 50 km UK transport is added for

dry resources. 10k transport is

added for wastes, manures and

sewage sludge

• Imported chips, including 50km UK

transport are available at the prices

shown

Year 2008 2010 2015 2020 2030

Import price £/GJ 7.28 7.09 5.14 4.41 4.04

5. UK demands

-8.00

-6.00

-4.00

-2.00

0.00

2.00

4.00

6.00

0 200 400 600 800 1,000 1,200 1,400

Co

st (£

/GJ) Supply (PJ)

BAU 2030

Central RES 2030


High growth 2030

75

Waste & Fuels – all scenarios in 2030

75

ScenarioImport

price £/GJ

BAU 4.04

Central RES 4.04


High Growth 4.04

• This curve is suitable for

• Energy from waste plants

using thermal

technologies

• Second generation

biofuels production:

lignocellulosic ethanol

and FT biodiesel

• Synthetic natural gas via

gasification

• It includes all resources

except wet manures and

landfill gas

• These are chipped ,

chopped or dried where

necessary

• 50 km UK transport is

added for dry resources.

10k transport is added for

wastes, manures and

sewage sludge

• Imported chips, including



shown

5. UK demands

76

Landfill gas

76

• Landfill gas is given separately from the other resources as there are no other gaseous

feedstocks. Anaerobic digestion of other resources to form biogas will entail additional cost.

• We have assumed that landfill gas is available at zero cost, and therefore there is no supply

curve for this feedstock.

• The resource is the same in all scenarios

Year 2008 2010 2015 2020 2030

Resource (PJ) 61 54 39 29 15

5. UK demands

77

Contents

1. Introduction

2. UK supply

3. Global supply



6. Conclusions

7. Annexes

78

There is a significant potential from UK feedstocks at

reasonable cost

78

• The biomass resource from UK feedstocks could reach around 10% of current UK primary energy demand by

2030, at a cost of less than £5/GJ

• Nearly half of the resource in each year has a negative cost, as a result of the availability of large

quantities of waste materials, which would otherwise require disposal

• Energy crops make up around 80% of the positive cost resource. Achieving this potential requires a

significant ramp up in planting rates

• The resource in earlier years is much smaller. For example, the resource in 2020 is around 60% of the 2030

resource. This is partly due to a lower resource potential, but for many feedstocks the resource is significantly

limited by the sector’s capability to extract or grow the feedstock

• For each feedstock, we estimated how much of the resource could be extracted now using current

capabilities, labour and machinery and considering existing practices

• This was then ramped up to the full resource, using estimates of how fast each sector could develop.

These assumed that each in sector the potential for bioenergy was recognised now, e.g. through an

obvious market or policy support, and changed as fast as possible to meet the demand. No specific policy

measures or markets were considered

• Scenario analysis showed that the key factors affecting biomass resources and costs are

• Land availability for energy crops: restriction of the use of pasture land for energy crops to 10% in Central

RES and High Sustainability scenarios, rather than the 50% used in other scenarios, reduces the energy

crop potential by around a half. It is not yet known exactly how the sustainability restrictions on use of

grassland included in the RED will be applied, but these could have a large impact on energy crop

potential

• Energy crop yields: crop development can lead to lower costs (£0.5-1/GJ) and higher resources

• Waste generation and management: increased waste reduction and recycling reduce bioenergy potential

6. Conclusions

79

Imports provide a high cost, but very large resource

79

• Several biomass types are already traded internationally. As supply and demand for bioenergy increases

worldwide, it is likely that a global market will develop, and biomass will increasingly become an internationally

traded commodity

• As a result, biomass supply and demand should be considered globally, rather than focusing supplies from

within the UK or within the EU

• In the analysis, we assumed that woody biomass feedstocks, which are a relatively homogenous group of

resources, with a large potential, will become a commodity. If the UK is assumed to be a price taker, the import

price can be found

• The analysis showed that global woody biomass resources could potentially be very large. This considers that

they are grown predominantly on abandoned agricultural land, with demands for land for food and for first

generation biofuel feedstocks being supplied first. Achieving this potential would rely on a fast ramp up of

energy crop planting

• However, this analysis finds that the global price may be higher than most indigenous UK feedstocks.

Supplying world woody biomass demand at the levels projected would require use of energy crops, as well as

lower cost feedstocks. Adding transport costs to the global price results in higher prices than UK feedstocks.

• Import prices could be lower than this in some cases:

• Before a global commodity market develops, it may be possible to access lower cost feedstocks -

imported residues at £2-3 /GJ would increase supply while UK energy crop supplies are limited

• If transport costs are lower than the average transport costs included here – through import of more

easily accessed resources

6. Conclusions

80

There may be more competition for feedstocks

between some demands than others

80

• We have provided supply curves suitable for different UK demands, as different conversion technologies have

different acceptable feedstocks, and pretreatment and transport requirements. Note that the costs for these are

higher than in the general curves, as UK transport and processing is added

• These curves show all of the feedstocks suitable for each demand, rather than making assumptions on how the

demands compete with each other

• Most resources can be used to generate either electricity, heat, or transport fuels, via a range of conversion

technologies*

• However, it is likely that some feedstocks will generally be used in particular types of plant, whereas others are

more flexible. As a result, there will be more competition between some feedstocks than others

• For dry resources that are easy to handle, such as woody residues and energy crops, there will be

competition between electricity, CHP and domestic heating, as well as second generation biofuels once

their conversion technology is commercialised

• For wastes, there may be some competition for resources that can be dried and transported, such as

sewage sludge, but for wetter resources, use in local waste to energy plants, or biogas plants is more

likely

• This analysis provides the information needed to model this competition between demands for bioenergy

feedstocks

* It should be noted that once biogas or synthetic natural gas

is produced, it could be used directly for electricity, heat ,

CHP or as a transport fuel, or injected into the gas grid

6. Conclusions

81

Contents

1. Introduction

2. UK supply

3. Global supply



6. Conclusions

7. Annexes

82

Annex A: UK supply data

82

• Energy crops

• Agricultural residues (straw)

• Forestry residues

• Stemwood

• Sawmill co-product

• Arboricultural arisings

• Sewage sludge

• Livestock manures

• Waste wood

• Wastes

• Landfill gas

Annex A: UK supply

83

Energy crops - resource

Resource

Resource = ((Arable area - Arable constraint) + (Pasture area - Pasture constraint)) x Yield x Availability

• Arable area:

• For 2008, set aside and bare fallow/land withdrawn from production. ADAS data for 2007, considered to

be a comprehensive study of UK arable land

• Refuel projections of abandoned arable land in 2030, as a result of increase in food production

efficiency, under several scenarios. Refuel projections were used, as they are lower, and based on more

detailed modelling than those from the EEA report

• Linear interpolation between these, as many of the factors causing the change are linear.

• Arable constraint: No constraint applied in any scenario

• Pasture area:

• Refuel projections of abandoned pasture land in 2030. Only one result given (no scenario variation)

Land begins to be abandoned from the Refuel base period 2000-2002

• Linear interpolation between these points

• Pasture constraint: applied at 10% in Central RES and High Sustainability scenarios only. All planting on

pasture assumes to be able to be no-till, and therefore give no land use change emissions

• Yield:

• For 2008, value and distribution of energy crop yields across England, on arable and improved

grassland from Pepinster (2008), based on spatial models from Southampton University and

Rothamsted Research. This assumes the highest yielding of SRC willow, SRC poplar, or miscanthus is

planted on each grid square

• For future years, the same distribution is used, with a yield increase factor which varies by scenario.

This is because a direct forecast of future costs was not available, hence a detailed model of the current

situation was used to give the spatial yield distribution within the UK, and allow adjustments of costs for

future years using yields

• Availability: planting rates are limited by labour and machinery, and are currently very low. Assumed 1000

ha/year planting in 2009, doubling each year until a maximum of 150 kha/year, based on data from ADAS

(2008) and communication with David Turley, CSL

83

Annex A: UK supply

84

Energy crops – cost and results

Cost

• Cost basis: an intermediate approach was taken.

• Costs are calculated using a land rent (i.e. a price of land that takes into account competing land uses).

• However, effects on the price of energy crops as a result of competing uses for the product are not

considered

• 2008 cost for each energy crop taken from Alberici (2008), based on a review of literature and industry views

on energy crop costs, adjusted to remove subsidies where necessary. This considers the land rent and

production cost on each grid square. The costs are given for chopped SRC, and baled miscanthus, at the farm

gate.

• Future cost reduction assumed to be a function of yield increase only, not reduction in management costs

• Energy crop subsidies were also included for one slide above:

• Energy crop scheme establishment grants of £1000 /ha for SRC and £800 /ha for miscanthus

• EU area payments of £30/ha/yr

Results

• Arable area: from 605 kha in 2008 to 963-1334 kha in 2030 (see next slide)

• Pasture area: from 290 kha in 2008 to 1200 kha in 2030. Available area reduced considerably by pasture

constraint in Central RES and High Sustainability scenarios

• Yields: yield factor increases from 1 to 1.24 in BAU and Central RES from 2008 to 2030, and from 1 to 1.55 in

High Growth and High Sustainability

• Cost: range from £1.8-4.4/GJ in 2008, decreasing to 2030 (see next slide)

• Subsidies reduce the costs of energy crops by around £0.6/GJ in 2030 under the BAU scenario, to £1.5-3 /GJ

84

Annex A: UK supply

85

Energy crops – scenario variation


Land scenario

• Refuel BAU scenario –

current farming trends

leaves some land for

bioenergy

• Refuel BAU scenario –

current farming trends

leaves some land for

bioenergy

• Refuel low scenario –

more sustainable farming

leaves less land for

bioenergy

• Note that this differs from

Hoogwijk’s global

assumption that lower

meat consumption frees

up more land

• Refuel high scenario –

intensified farming trends

leaves more land for

bioenergy

• Note that this differs from

our global assumption

that the higher world

population leads to more

land demand for food

Arable area

2030 (kha)• 1100 • 1100 • 963 • 1334

Pasture area

constraint• 100% can be used • Restricted to 10%* • Restricted to 10%* • 100% can be used

Yield

improvement• 1% p.a. increase • 1% p.a. increase • 2% p.a. increase • 2% p.a. increase

85

* (current proportion of pasture that is temporary as opposed to permanent, as a proxy

for non ‘highly biodiverse land’ as specified (but not yet defined) in the RED)

Available area (kha) Planted area (kha)

2008 2010 2015 2020 2030 2008 2010 2015 2020 2030

BAU 895 1022 1342 1661 2300 8 9 71 713 2213

Central RES 634 687 820 954 1220 8 9 71 713 1220

High Sust 634 675 777 879 1083 8 9 71 713 1083

High Growth 895 1044 1416 1789 2534 8 9 71 713 2213

Annex A: UK supply

86

Agricultural residues (straw)

Resource

Resource = Straw available x Availability

• Straw available is taken from CSL, 2008. This report considers the UK straw resource from all straw types,

assuming a recoverability factor of straw from the field of 60%. It then considers a number of existing uses,

including for energy, resulting in a potential of 2-3m tonnes, assuming animal feed requirements are fulfilled by

barley straw only. In personal communication with CSL, the resource excluding the energy uses was estimated

at 3.3 mt. This is assumed to be composed of the whole oil seed rape straw resource (2.5 mt), as this is not

currently collected, with the remainder being wheat straw.

• Availability: additional labour and machinery will be needed to extract and handle straw. Assume able to collect

10% of the resource today, 20% in 2010, 50% in 2015, and 100% in 2020 for all scenarios. This rate is

relatively slow, as oil seed rape straw is not currently extracted in large quantities, and is more difficult to

handle than wheat and barley straw.

Cost

• Cost basis: As we have excluded straw needed for other uses, no price competition with these is considered

• Costs of supply are harvesting, baling and handling costs (as baled, at farm gate), and costs of fertiliser to

replace nutrients lost, using the method developed by ADAS (2008)

• Supply curve based on 4 assumptions:

• No straw is extracted below the cost of harvesting and fertiliser replacement

• Half of the straw is extracted at below current straw prices

• 90% of the straw is extracted at below a price = (fertiliser value of straw + extraction costs) x 1.5

[additional 50% to cover value of other nutrients, soil structural benefits, profit margin]

• Some farmers will never extract straw: 2%

Results

• 3.3 mt of straw are available (69 PJ)

• Cost range £37/odt to £84/odt (£2.14/GJ to £4.98/GJ)

• Compares with 3 mt resource in Defra biomass strategy, and central price of £2/GJ

86

Annex A: UK supply

87

Forestry residues

Resource

Resource = ( Poor quality stemwood + Tips + Branches ) x Availability

• The potential resource of Poor quality stemwood + Tips + Branches available at the roadside is taken from

Forestry Commission data, which takes into account biological, environmental and operational factors within

managed forests. This McKay GB woodfuel resource study is the only detailed forecast available for managed

forests, giving a breakdown into different tree components

• Stumps, roots and foliage are not considered to be available

• Only very small changes over time are given in managed residues, however, English FC policy to introduce

1Modt/yr of under-managed forest into management by 2020 will add an additional 128kodt/yr of forestry

residues. Pers. comm. with Helen McKay confirmed that this is an additional resource (no double-counting)

• There are no scenario differences since long growth times of forest set the forecast available resource

• None of this resource is currently extracted and used, so no competing uses need to be taken into account

• Availability: additional labour and machinery will be needed to extract and handle forest residues. Assumed

that none can be collected today, 10% in 2010, 50% in 2015 for BAU and Central RES (75% for High Growth

and High Sustainability), and 100% in 2020 for all scenarios

Cost

• Cost basis: There are no other uses, so a cost basis was used

• A separate operation is required to collect the resource after tree felling. Costs of supply are forwarding and

roadside chipping costs. Data and calculation method comes from the Finnish Forest Research Institute

(2004), hence is consistent with the approach used for global resource, but using costs for only a NW Europe

country

Results• Currently, no forestry residues are available. This rises to a peak at 1.04m odt (19.3 PJ) in 2020

• Cost at roadside as chips: £38 /odt (£2.3/GJ)

87

Annex A: UK supply

88

Stemwood

Resource

Resource = ( Harvested stemwood – Existing uses ) x Availability

• The Forestry Commission’s Softwood Forecast (2005) gives the potential harvested stemwood, with a peak in

softwood production in 2020. The hardwood resource is much smaller.

• English FC policy to introduce 1Modt/yr of under-managed forest into management by 2020 – which will add

an additional 709kodt/yr of soft and 145kodt of hard stemwood. Pers. comm. with Helen McKay confirmed that

this is an additional resource (no double-counting)

• No scenario differences since long growth times of forest fix the forecast available resource

• Existing uses

• For softwood there are several current competing uses. In the future, sawmills expand to take all

softwood resource greater than 16cm in diameter. Demand from panel, paper, fencing, exports and

others are held at constant volume (FC Statistics 2008).

• Most of the hardwood is already used for woodfuel (available resource)

• Availability : 100% is usable now

Cost

• Cost basis: As we have excluded stemwood needed for other uses, price competition with these uses is not

considered

• Costs of harvesting stemwood and extracting logs to roadside: The South West Biomass Bio-Renewables

report (2004) gives a range of harvesting costs dependent on technique – an average value for soft and

hardwood was chosen. Tree felling is cheaper for softwood than hardwood, with no change over time or

scenarios

Results• Currently, 0.25m odt of stemwood is available as woodfuel (4.5 PJ), peaking in 2020 at 0.94m odt (17.5 PJ)

• Cost at roadside as logs: £28 /odt (£1.50/GJ) for softwood, £60/odt (£3.23/GJ) for hardwood

88

Annex A: UK supply

89

Sawmill co-product

Resource

Resource = ((Stemwood deliveries x Conversion factor) – Existing uses) x Availability

• The amount of stemwood delivered to sawmills is the same as the sawmill competing use considered

previously, and hence changes over time, but not scenario

• Conversion factor: ratio of co-product produced for each tonne of stemwood input = 51%. (Forestry

Commission Statistics 2008). This is an up-to-date and detailed data source, allowing calculation of existing

uses, conversion factors and form. Furthermore, it enables the incorporation of forecast stemwood input from

previous slide, for consistency

• Existing uses: panelboard industry (currently takes 65% of total co-product), paper, exports and other all held

at constant volume (FC Statistics 2008), since increase in demand for panels will be met by the increase in the

industry’s recycled waste wood uptake

• Availability : 100% is usable

• Form: 69% woodchips, 20% sawdust, 11% bark

Cost

• Cost basis: As we have excluded sawmill co-product needed for other uses, price competition with these uses

is not considered

• Co-product is a by-product of making sawnwood, and so we have considered it to be free at source

• Costs of handling and storing co-product onsite £9.9/odt (Saskatchewan Forest Research Centre, consistent

with the global costs used)

Results• Currently, 0.13m odt available (2.4 PJ), peaking in 2020 at 1.05m odt (19.5 PJ)

• Cost at sawmill: £9.9 /odt (£0.53/GJ)

89

Annex A: UK supply

90

Arboricultural arisings

Resource

Resource = (Tree surgery arisings – Existing uses) x Availability

• The amount of tree surgery arisings was taken from the McKay GB woodfuel resource study (2003). This does

not change over time, or scenario

• Existing uses: currently 31% of the arisings have a market, of which half assumed to be woodfuel logs (and

therefore available for energy), but the other half is taken by non-energy wood industry uses

• The un-marketed resource (68% of total, McKay) can be used for energy. This can be blown-back onsite if site

constraints allow (18% of total) – however, 50% of the total arisings (Land Use Consultants 2007) are

collected, transported then landfilled

• Availability : 100% of the landfilled resource, and 100% of the woodfuel resource is available. None of the

blown-back resource is available in 2008, rising to 100% in 2010

• Form: 53% stemwood, 23% already chipped, 20% branches, 4% foliage

Cost

• Cost basis: As we have excluded marketed non-energy demand for other uses, price competition with these

uses is not considered

• Resource arises from necessary tree surgery activities, and so are considered free at source if blown-back. If

due to site constraints, the material has to be collected, transported and disposed of, this resource is available

at the avoided landfill cost

• Costs of supplying the woodfuel and blown-back resource are the costs of transportation back to a depot

(onsite collection already carried out), with handling and storage costs

• Transport costs used are from Suurs (2002), assuming that the whole resource can be transported at the same

cost as chips

Results

• Woodfuel and blown-back resource: 0.08m odt available (1.5 PJ) in 2008, rising to 0.17m odt available (3.2

PJ), cost as logs at depot: £1.2/GJ

• Landfilled resource: 0.25m odt available (4.6 PJ), at avoided landfill gate fees of -£2.26/GJ

90

Annex A: UK supply

91

Sewage sludge

Resource

Resource = Sludge arisings x Availability

• Sludge arisings are predicted to grow to 2010 as more households are connected and with tighter regulation

(Defra Waste Strategy), then following population growth afterwards (National Grid). No change with scenario

• Sludge is considered as a waste that needs treatment, then disposal.

• Final disposal (e.g. to farmland, land reclamation) is unimportant – the treatment process used is where energy

can be extracted. Defra Online Statistics give detailed and historical arisings and disposal routes, but no

treatment methods

• 66% of sludge is currently treated via AD (Water UK, 2008), 24% is dried then incinerated, hence 90% of the

resource already has energy extracted. The rest (10%) is treated via lime stabilisation, hence is unavailable for

energy.

• Availability: 90% in 2008, rising to 100% in 2010 with changes in treatment

Cost

• Cost basis: There are no competing uses for sewage sludge before it is treated.

• The costs considered are

• Dewatering before AD £60/odt (Sowa, 1994)

• The gate fee for alternative sludge treatment - £45/tonne (Strathclyde University).

• An alternative approach would have been to consider sewage gas as zero cost (e.g. as in Enviros 2005 and

National Grid 2008), and combine the resource with the landfill gas resource, however, this would not allow

modelling of use of dried sewage sludge in thermal processes

Results

• Currently, 1.39m odt available (15.2 PJ) rising to 2.03m odt in 2030 (24.6 PJ)

• Cost of dewatered sludge at WWTW: -£68/odt (-£6.22/GJ)

• Defra Biomass Strategy resource figure is only 0.34m odt, due to the assumption that sludge that ends up on

farmland or used in reclamation is unavailable. We did not assume this as if sludge is treated via AD, the

digestate can still be spread on farmland to supply this requirement

91

Annex A: UK supply

92

Livestock manures

Resource

Resource = (( Livestock numbers x Manure factor ) x Occupancy – Existing uses ) x Availability

• Livestock numbers from ADAS show a long term decline (except in poultry) over time. No change with scenario

• This ADAS study is the only one available with livestock numbers forecast past 2015, and is highly detailed

(many different animal categories)

• Each animal category has a different excretion rate, manure dry matter content and farm management system.

The excretion rate was multiplied by the dry matter content(s) of the slurry and/or farmyard manure to give a

manure factor per animal per year (Smith 2000).

• Occupancy: is the time an animal spends inside (Defra Agricultural Practices Survey), which gives the

collectable resource, since excreta outside are uncollectable. Farms outwintering their livestock have negligible

occupancy (pers. comm. James Copeland, CSL)

• Existing uses: Resource from farms that do not store or export slurries / manures (i.e. spread directly to land)

is assumed to be unavailable. The remaining dry poultry litter is available for incineration, whereas wet poultry,

pig, sheep and cattle slurries and manures are only available for AD (less than 30% Dry Matter)

• This method above follows the basic method of the Defra Biomass Strategy, but includes all animal categories,

outwintering farms, the additional straw within farmyard manure and farms without storage facilities

• Availability : For litter 18% is currently incinerated, rising to 50% in 2010, and 100% by 2015. For wet manures,

1% is currently used as a feedstock for AD, rising to 10% in 2010, 50% in 2015 and 100% in 2020

Cost

• Cost basis: No competing uses, free at source

• Assumed that farmers will not pay the AD plant or incinerator to get rid of the resource, but would be likely to

spread the AD digestate for its fertiliser value for free (Strathclyde University)

Results

• 0.265m odt available (4.2 PJ) increasing to 5.8m odt in 2030 (91.9 PJ)

• Defra Biomass Strategy figure is 3.9m odt, due to counting fewer categories of animals (did not count beef

cattle, any breeding stocks, other poultry, sheep)

92

Annex A: UK supply

93

Waste wood

Resource

Resource = (( MSW + C&I + C&D arisings ) ^ Growth rates – Recycling ) x Availability

• Amount of waste wood in MSW, Commercial & Industrial and Construction & Demolition waste streams, from

WRAP 2005. Although there is uncertainty regarding Construction & Demolition arisings (the two studies

WRAP 2005 use gave 2mt and 8mt), WRAP 2005 is still the latest collection of surveys with a breakdown by

sector, allowing different growth rates to be applied to calculate total arisings

• Growth rates of arisings are 0.75% for MSW, 1.18% for other sectors (Defra Waste Strategy). These each

decrease by 0.75% in the High Sustainability scenario, and increase by 0.25% in the High Growth scenario

• Competing uses: use by the wood panel industry currently accounts for 1.2mt, rising to 2.2mt by 2010 (WRAP

2008). This is increased under the High Scenarios to 2.6mt

• Availability : Currently, 15% is separable for energy recovery, increasing to 100% by 2020 in BAU and Central

RES, or by 2015 in High Sustainability and High Growth

Cost

• Cost basis: Waste, so free at source – and as we have excluded non-energy disposal routes/recycling, price

competition with these routes is not considered

• Costs are the avoided landfill gate fee for contaminated wood, gate fee of £8 /t for reprocessing for clean wood

Results

• Currently, 1.1m odt are available (19 PJ) increasing to 8.4m odt in 2030 (149 PJ) under BAU because of

arisings growth and a cap on amount of recycled wood that the panelboard industry can accept

• Cost -£26/odt (-£1.4/GJ) for contaminated waste wood, and -£10/odt (-£0.6/GJ) for clean waste wood

• The Defra Biomass Strategy availability figure is much larger at 5.56m odt (equivalent to 7mt), because no

restriction on separability is assumed.

93

Annex A: UK supply

94

Wastes

Resource

Resource = (( MSW + C&I arisings ) ^ Growth rates – Recycling ) x Availability

• The amount of paper/card, food/kitchen, garden/plant, textiles arising in MSW, Commercial and Industrial

waste streams, was taken from ERM Golder 2006. This is the most comprehensive study available of UK

wastes by sector, composition, and recycling/composing/AD/disposal routes, allowing growth rates to be used

to forecast each waste arisings

• Growth rates of arisings are 0.75% for MSW, 2.68% for Commercial, -0.72% for Industrial (Defra Waste

Strategy). These each decrease by 0.75% in High Sustainability scenario, and increase by 0.25% in the High

Growth scenario

• Recycling: Waste that is recycled is excluded, as this is a competing use. Recycling increases for paper/card

and textiles by 2.7mt and 0.3mt respectively by 2020 (WRAP, 2007). In the High Growth scenario additional

recycling is assumed, taking the same proportion of the arisings. Waste going to AD and composting is

considered to be available for energy

• Availability: Current separability is 48% for paper/card and 19% for textiles (all recycled), 17% for food/kitchen

and 26% for garden/plant (for AD/composting). This is assumed to increase by 2%/yr above recycling and

composting rates under BAU and Central RES, and 4%/yr under High scenarios, until a 90% maximum is

reached, based on international experience (ERM Golder)

Cost

• Cost basis: Waste, so free at source – and as we have excluded non-energy uses (i.e. recycling), price

competition with these routes is not considered

• Costs are avoided landfill gate fees

Results

• Currently, 1.2mt paper/card, 3.0mt food/kitchen, 3.7mt garden/plant, and 0.06mt of textiles available (13, 10,

16, 1 PJ respectively)

• Costs range from -£1.5/GJ to -£6/GJ

• Defra Biomass Strategy gives: 3.3mt for paper/card, 10m t food/kitchen and 3m t garden/plant. This assumes a

90% separability now, and subtracts future recycling and composting from the current resource

94

Annex A: UK supply

95

Landfill gas

Resource

Resource = Current landfill gas production x Exponential decay

• The biodegradable wastes considered in the rest of the analysis are available for energy if separable. If they

are used for energy, they will not be landfilled, and so will not contribute to future LFG generation. As a

simplification, we have assumed no new waste is landfilled from 2008. This is a conservative estimate (see

below)

• Current LFG production used for energy is taken from DUKES 2008.

• Gas production from existing landfill follows an exponential decay with a half-life of 11 years (Enviros),

• This assumes that no new gas capture is installed on existing sites, and that no sites currently flaring gas

switch to energy production

• These are conservative assumptions as modelling landfill production under different scenarios would be

complex:

• Any biodegradable wastes expected to be landfilled have been counted as available resource in other

categories, if separable. Hence, in this category (to avoid double counting) any separable waste must

be counted as unavailable

• In reality, not all wastes are separable now, and so some will be land filled, and contribute over time to

landfill gas production

• However, forecasting landfill gas production would require knowledge of the amount, composition and

decay characteristics of each type of waste. It could be assumed that the total amount of waste

landfilled stays constant, giving constant landfill gas production over time, or alternatively, if all landfills

close, there will be an exponential decay. The reality will be somewhere in-between

Cost • Cost basis: Zero cost resource, as the resource considered is already collected and used

Results • Currently, 63 PJ of landfill gas is available for electricity and heat (current usage), falling to 15 PJ in 2030

95

Annex A: UK supply

96

People consulted on UK data

96

• Alan Corson, FE (forestry costs)

• Geoff Hogan, FC (general forestry)

• Justin Gilbert, FC Stats (forest residue forecasts)

• Patrick Mahon, WRAP (recycling)

• Daniel Dipper, Defra (wastes)

• Helen McKay, FC Stats (forestry)

• Bruce Horton, Water UK (sewage sludge)

• David Turley, Central Science Lab (manures, straw, energy crops)

• James Copeland, Central Science Lab (manures)

• Melville Haggard, Defra (waste wood)

• Sheila Ward, FC (sawmills)

• John Kilpatrick, ADAS (straw and energy crops)

• Ian Tubby, Biomass Energy Centre (energy crops)

Annex A: UK supply

97

Annex B: Global supply data

97

• Wood Processing Residues: clean co-products from sawmills, panelboard and pulp industries

• Forestry Residues: residues produced from conventional logging and thinning operations

• 1st Generation Biofuels

• Surplus Forest Wood

• Energy Crops

• Algae

Annex B: Global supply

98

Wood Processing Residues

Resource

Resource = ((Wood product manufacture x Residue factor) - Competing Uses ) x Availability

• Wood product manufacture: Residue generation is directly proportional to wood product manufacture. Available

projections were poor predictors of current demand (FAO Global Forest Product Outlook, out of date), and no

other reliable, long-term projections for supply and demand of forest products were available. As a result, the

recent trend in global per capita wood product demand (FAOSTAT and UN population data) was used . The

High Growth scenario assumed ‘High’ population growth. All other scenarios assume ‘Medium’ growth (UN

projections)

• Residue factors: from academic literature (Parikka, 2002)

• Competing uses: from the pulp and panel industry. Pulp and panel production follows the recent trend in per

capita demand. Demand for residues is a constant fraction of pulp and panel production (coefficients derived

from UNECE-FAO Joint Wood Energy Enquiry). Currently, the pulp and panel sector uses around 60% of total

global residues supply as material input

• Availability: 100% of the remaining resource is available

• Form: 25% chips, 24% bark, 24% slabs/edgings, 20% sawdust, 3% shavings, 4% other

Cost

• Cost basis: The resource requirements for the competing uses have been subtracted from the resource, and

so the cost of the resource is considered.

• Cost of residues at sawmill £7/ odt taken from Saskatchewan Forest Centre report on economics of pellet

production

Results• Available resource under BAU: 113M odt (2.1 EJ), rising to 172M odt (3.2 EJ) in 2030

• Cost of various residue forms onsite: £0.38/GJ

98


99

Forestry Residues

Resource

Resource = ( Roundwood Production x Sustainable Residue Harvest Ratio ) x Availability

• Roundwood Production – Future demand for roundwood follows the recent trend in global per capita demand

(FAOSTAT and UN population data, same approach as previous slide). Roundwood obtained from non-forest

areas is excluded (e.g. urban areas and non managed woodland) since this would not be derived from

conventional logging activities

• Sustainable Residue Harvest Ratio – This is the ratio of residues to stemwood that can be removed

sustainably (i.e. avoiding nutrient depletion). Residues are tops, branches and undergrowth. In the High

Growth scenario, the Harvest Ratio is 0.2-0.3, which assumes that the forest is fertilised manually: e.g. through

ash recycling. Otherwise, values of 0.1-0.15 are used (Ericsson & Nielsen)

• Availability: additional labour and machinery will be needed to extract and handle forest residues. Currently,

around 7% of the total residues, which is equivalent to 56% of the sustainable harvest (or 28% in High

Growth), are extracted. We assumed that this increases to 100% by 2020 in each scenario

Cost

• Cost basis: The resource requirements for the competing uses have been subtracted from the resource, and

so the cost of the resource is considered

• Capital and labour cost of forwarding, roadside chipping and management (Finnish Forest Research Institute

(2004)). The same calculations are used in REFUEL and reports by the JRC. Distinction between labour costs

in developed and developing world.

• Costs: Developing countries £1.39/GJ, developed countries £2.15/GJ

Results

• 1.7EJ current availability, rising to

• 3.86 EJ in 2030 under BAU, Central RES and High Sustainability

• 8.3 EJ in 2030 in High Growth Scenario

• Over 50% of the global potential is located in Europe and North America

99


100

Surplus Forest Wood (not included)

Resource

• This resource was defined as wood not required for competing demands, that comes from sustainable sources:

• Sustainable sources defined as:

• Wood from plantation forests OR

• Wood from forest that is a) not undisturbed b) classed as available for wood supply c) growing

commercial wood species (all classifications are FAO terminology)

• However:

• At a global level, supply of wood from plantations + commercial disturbed forest + commercial undisturbed

forest is insufficient to meet roundwood demand projections

• This suggests a significant presence of illegal wood in the global timber supply (for which there is anecdotal

evidence)

• Therefore, biomass supply from surplus forest wood is excluded

100


101

First generation biofuels - demand

101

• First generation (1G) biofuel feedstocks cannot be plotted on the same supply curve as

other feedstocks, as they have specific conversion routes to fuels, and so are considered

separately here. They are also used to reduce the land area available for energy crops

globally

• For feedstocks (sugar, starch and oils) for first generation biofuels, the volume used for

biofuels and price depend strongly on global food and biofuels demand. In theory, 1G

biofuels could draw feedstock from the food market to supply demand at any level

• Therefore for first generation biofuels, we have looked at projections of volume demanded

and market price.

0

0.5

1

1.5

2

2.5

2005 2010 2015 2020 2025 2030 2035

De

man

d (

EJ)

BAU

Central RES

High Sustainability

High Growth

• 1G biofuel

demand is given

by the global

demand analysis.

It flattens or

decreases after

2015 as 2G

biofuels begin to

be used


102

First generation biofuels - prices

102

• The price of 1G biofuels will depend heavily on global commodity prices for sugar and

starch crops, and vegetable oils

• As an indication, the OECD-FAO Agricultural Outlook 2008 projects prices to 2017. When

these are

2008 2010 2015 2017

Bioethanol (USD/hl)53.00 53.96 52.69 51.35

Biodiesel (USD/hl)98.55 105.78 106.31 105.49

Bioethanol (£/GJ, deflated to 2008)12.85 12.63 12.10 10.73

Biodiesel (£/GJ, deflated to 2008)16.45 17.04 16.81 15.17

• It is likely that in a High Growth scenario, these prices would be higher than the central

projections, as a result of increased food demand, despite the drop in 1G biofuels demand


103

Energy Crops - resource

Resource

Data is based on a global analysis from Hoogwijk (2008), which:

• considers the potential from woody energy crops (e.g. willow, poplar, eucalyptus), with the variety depending on

suitability

• gives the

• theoretical potential in 2050 for 4 IPCC-derived scenarios (A1, A2, B1, B2), of which 2 are used as a

basis for our scenarios (A1 and B1) – see following slides

• global economic potential (at production cost of up $5/GJ) in 2050 for the 4 scenarios

• considers two main types of Available Area

• abandoned agricultural land – released as agricultural technology and food demand changes.

• non-agricultural land – extensive grassland, and abandoned pasture, excluding nature reserves.

We then estimated the potential resource to 2030 by:

• backcasting Hoogwijk’s available area and productivity from 2050 to 1995 to give a 1995 potential

• forecasting to 2030, using

• available abandoned agricultural area projections from Hoogwijk, modified to remove land needed for 1G

biofuels, and to remove extra land needed for food in the High Growth scenario. Under High Growth

scenario, global food demand is ramped up to an extra 7.2% by 2030 (UN High instead of Medium

Variant population forecast). This requires an extra 410Mha of agricultural land to meet the larger

demand, hence much less land released compared with Hoogwijk A1 scenario

• a proportion of the (constant) non-agricultural land area: 50% in BAU and High Growth, and 10% in

Central RES and High Sustainability, based on Hoogwijk’s assumptions.

• management factors adapted from Hoogwijk to reflect our scenarios

• In any given grid square: yield = theoretical yield per grid square * Management Factor

• Management factors increase over time from 0.84 in 2008, up to a maximum of 1.3 in 2030 under

BAU and Central RES, and from 0.86 in 2008 up to a maximum of 1.5 in 2030 under High Growth

and High Sustainability (representing increased technological development)

103


104

Energy Crops – planting rates and costs

Planting

• We assume that in a given year the area planted is a proportion of the whole supply curve, not that the best

land is planted first. However, because the entire supply curve considered consists only of economically viable

land, and this land is distributed worldwide, this assumption is more reasonable than assuming that the very

cheapest land is used first

• We also assume that abandoned agricultural land is always planted before any non-agricultural land, due to

similarity to existing practices, even though the non-agricultural land may have comparable production costs.

The driver to plant on these different land types may depend on the definition of idle and marginal land under

the RED sustainability criteria designed to avoid indirect land use change.

• A global planting rate was estimated by scaling up the UK planting rate in proportion to the relative arable areas.

The 13Mha currently planted increases by 0.32Mha in 2009, with the rate then doubling each year until 2017

when the maximum planting rate of 48Mha/yr is reached (48Mha is 3% of current global arable area).

• Including these planting rates results in the energy crop potential being limited even in 2030 in all scenarios

Cost

• Production costs are also based on Hoogwijk, who uses the following equation:

• Cost (£/GJ) = (Land cost + (Management costs * cost reduction factor)) ‚ yield

• Cost is lower on grid squares with higher yield

• Cost varies over time with changing cost reduction factor, reflecting increased productivity of labour and

capital, therefore less inputs needed per GJ. Note that this is different from the UK assumption, where

cost reduces with yield only, as management is not projected to increase

• Hoogwijk gives supply curves for areas able to produce energy crops at <$5/GJ in 2050.

• This amounts to around 80% of the potential from Abandoned Agricultural land and 45% from Non-

agricultural land

• We assumed that the distribution of costs across the resource would be the same in intervening years, and

therefore derived a new supply curve using our resource and costs data.

104


105

Energy Crops – Hoogwijk scenarios

105


106

Energy Crops – choice of Hoogwijk scenarios

Basis of

Hoogwijk

scenarios

• Hoogwijk uses the IPCC SRES scenarios. These offer alternative versions of how the future might unfold

• The 4 scenarios vary according to the degree of global integration and social/ environmental concerns

• Our High Sustainability scenario is environmental focused hence B1 is the best match available, and our

High Growth scenario is economically focused hence A1 is the best match available

• In all our scenarios, trade is no more constrained than under current conditions, whereas in A2 and B2

trade is low. Furthermore, UN projects a low-high population range of 7.8-10.8 billion in 2050, hence it is

felt that A2 and B2 population projections are unrealistically high

• Therefore, we discount A2 and B2 as usable scenarios, and choose to adjust the management factors

behind the A1 scenario to account for less technology development in our BAU and Central RES

scenarios (compared with High Growth)

• However, B1 as given only has average technology development, therefore for High Sustainability to

include higher technology development, we adjust the management factors up to be in line with those of

A1/High Growth

Hoogwijk

approach

• The main advantage of Hoogwijk's approach is that it allows us to make short-term and long-term

projections of energy crop potential using the same methodology. This is possible because:

• Global agricultural land requirements are calculated by the IMAGE model for every year 1995-2100

• Supply curves are based on the development of technology over time as well as the quality of

land made available for bioenergy from abandonment

• Most other studies of global biomass potential are extremely theoretical, making it difficult to relate results

to different scenarios. Few global studies are temporally-explicit, making it difficult to draw a path from the

present to the long-term potential, whereas the more detailed studies, such as REFUEL, are not global

106


107

Energy Crops – scenario variation

107


Hoogwijk’s

Scenario

A1 Global-Economic

Orientation

A1 Global-Economic

Orientation

B1 Global-Socio-

environmental

A1 Global-Economic

Orientation

High Meat Demand


Medium Population Growth

– 8.3 billion in 2030

High Meat Demand




Low Meat Demand

Intensive Agriculture – but

less fertilisation



High Meat Demand




Adjusted food

demandNone None

None – already in B1

scenario above

Agricultural area factored up

according to UN high

population projection – 8.9

billion in 2030

Adjusted

Management

Factor

Annual growth: 1.4%

Maximum: 1.3

Annual growth: 1.4%

Maximum: 1.3

Annual growth: 1.6%

Maximum: 1.5

Annual growth: 1.6%

Maximum: 1.5

Land types

possible

Abandoned Arable


+ 50% of Non-agricultural

Land

Abandoned Arable



Land

Abandoned Arable



Land

Abandoned Arable



Land

Global available area (Mha) Global planted area (Mha)2008 2010 2015 2020 2030 2008 2010 2015 2020 2030

BAU 1,491 1,501 1,585 1,636 1,842 13 13 33 240 724

Central RES 489 499 582 628 834 13 13 33 240 724High Sus 476 491 565 665 854 13 13 33 240 724

High Growth 1,478 1,479 1,533 1,556 1,699 13 13 33 240 724


108

Energy Crops – geographical distribution

108

24%

16%

21%

8%

14%

17%

Europe & Former USSR

Africa

Asia

Oceania

North & Central America

South America

Distribution

of energy

crops

• Economic potential refers to biomass covered by our supply curves. It corresponds to biomass available in

the Hoogwijk study for $5/GJ in 2050, equivalent to 74% of the total potential. With our planting

assumptions, this distribution will be the same in 2030

• 19% of this economic potential is located in the former USSR, 17% in South America, 16% in Africa and

15% in East Asia

• The cheapest biomass (<$1/GJ in 2050) accounts for 3.4% of the economic potential (or 5.6% in B1). This

is almost entirely located in Western and Eastern Africa where relative labour costs are extremely low

• The next most expensive bracket of biomass (<$2/GJ in 2050) accounts for 60% of the economic

potential. 53% of this is located in Africa and former USSR (these percentages are 79% and 39%

respectively in B1)

• The B1 scenario has a very similar distribution (other than specific percentages given above)


109

Algae

Resource

Resource = Projected number of plants x Plant size x Yield

• The algal resource is unlikely to be limited by available global surface area, or by water requirements, given that

there is development of algae grown in sea water

• Projected number of plants: Based on analysis by E4tech for the Carbon Trust

• High Growth and High Sustainability: Assume first commercial scale plant is built in 2017, and the number

of plants doubles every year for first ten years, thereafter sustained growth rate of 50% per year

• BAU and Central RES: assume half the number of plants in 2020 compared with above, and then growth

rate of 50% per year

• Plant size: kept constant at 1000 ha

• Yield: the total yield of algal biomass is kept constant at 60 odt/ha/yr, but the oil proportion increased:

• High Growth and High Sustainability: 30% oil content by 2020, 42% by 2030

• BAU and Central RES: 30% oil content by 2020, 35% by 2030

Cost

• Cost basis used: competing uses of the bulk of the oil or biomass are not yet known

• Cost of a plant taken from McMahon, quoting Benemann and Oswald (1996). No reduction over time, as any

capital cost reduction is likely to be offset by increase in nutrients needed to achieve increased productivities

• Cost of oil reduces over time, as a result of increased yield

Results

• Resource: total algal biomass is 6PJ in 2020 under BAU and Central RES, 12 PJ under High Growth and High

Sustainability. Increase to 434 PJ in 2020 under BAU and Central RES, 4334 PJ under High Growth and High

Sustainability.

• Initial cost estimates are very high , at £14/GJ for algal biomass in 2030

109

• We briefly considered the costs and potential of energy production from algae, based on the best

available, and consistent data. However, as the costs projected were very high, we did not consider this

resource further


110

Annex C: Global demand data

110

• Assumptions and results for estimates of global demand for woody biomass (energy crops, forestry

wastes and wood processing residues)

Annex C: Global demand

111

BAU

Biomass and

waste

demand

• IEA World Energy Outlook 2008 (WEO 2008) gives the primary energy demand for biomass and waste to

2030(including wood, MSW, biogas, landfill gas, and all other biomass & wastes) in categories: electricity,

industrial and other (residential, services etc), and regions: US, EU and ROW.

• This includes demand for traditional biomass, which we have removed by subtracting the ‘Other’ category in

ROW, assumed to be largely traditional use.

• It also gives the biofuels (NOT primary energy) demand for transport

Proportion of

this from

woody

biomass

• It is difficult to estimate how much of this demand is from the resources we are considering – i.e. energy crops and

forestry industry residues (collectively termed ‘woody biomass’)

• The predicted total woody biomass demand is 6.6 EJ in 2008, rising to 15.2EJ in 2030, based on the following

assumptions:

• Transport: Very little woody biomass demand for transport until 2020 (WEO 2008 assumption). We assume

slow growth from 2020 to 2030. The US 2G proportion is estimated based on the 2G proportion of

Renewable Fuel Standard targets, but reduced as these are not expected to be met (5% of biofuels are

lignocellulosic in 2015; 25% in 2020; 50% in 2030). For the EU and ROW, we assumed that the 2G

proportion is half that in the US, as the US is likely to lead. For US and ROW, we assume 50% of this will be

from woody biomass in 2020; 70% in 2030. This is a conservative assumption, as agricultural residues (e.g.

corn stover) will be an important feedstock at first. For the EU, 70% is used throughout.

• Electricity: biomass electricity generated from Wood and derived fuels (Black liquor, and wood/woodwaste

solids and liquids) was 70% in the US in 2006 [EIA, 2008]. Of this, 64% is woody biomass (based on global

statistics for the proportion of black liquor in wood derived fuels, from IPCC 2007). For the EU, 50% is from

‘wood and wood waste’ (all non MSW solid biomass) [Eurostat 2008], of which 62% is woody biomass (IPCC,

2007). These were kept constant to 2030, and US figures used for ROW.

• Industry: US demand is 75% from wood and wood derived fuels [EIA, 2008], of which 64% is assumed to be

woody biomass (as above). For the EU, 98% is from ‘wood and wood waste’ (all non MSW solid biomass)

[Eurostat 2008], of which 62% is woody biomass (IPCC, 2007). These %s are assumed to remain constant to

2030, and US figures used for ROW. .

• Other: the US and EU ‘Other’ category, comprising residential, services, agricultural, non-specified sectors, is

assumed to be 30% woody biomass (E4tech estimate, based on the range of data seen)

111


112

Central RES

Biomass and

waste

demand

• The biomass and waste demand is the same in every Region and Sector in the Central RES Scenario as in

the BAU scenario (i.e. Based on WEO 2008), except for EU sectors, which change due to implementation of

the RED:

• The RED sets targets for transport energy, and for total energy demand (including heat and electricity), with

no defined split between them. We assume most of the Industry and Other sector biomass and waste

demand is for heat, and therefore consolidate them into a single ‘Heat’ sector

• Transport: 5% of total transport energy to be from renewables by 2015. Of this, the RED sets targets

for 20% from specific renewable fuels (2G biofuels, electricity or H2) by 2015; and 40% by 2020. Of

this, we assume 100% is met by 2G biofuels in 2015; 95% in 2020. The 2020 values remain constant

to 2030.

• Electricity: 34% of electricity is assumed to be renewable by 2030, (EC estimate), with a linear ramp up

from the current 16%. 15% of this renewable generation is from solid biomass (excluding biowaste

and biogas) in both 2010 and 2020 (EC renewable Energy Roadmap 2006, assumed constant to

2030).

• Heat: the EU Renewable Energy Roadmap (2006) estimates the biomass contribution to EU heat

demands till 2020. Assume 2020 value constant to 2030.

Proportion of

this from

woody

biomass

• Same woody biomass % as BAU for USA and ROW for all sectors

• For EU

• Assume 70% of 2G biofuels are from woody biomass

• 62% of solid non-waste biomass for electricity and 58% of biomass for heat is from woody biomass.

[E4tech estimates based on IPCC 2007]

• This gives a total woody biomass demand of 6.6EJ in 2008, rising to 16.4EJ in 2030

112


113

High Growth

Biomass and

waste

demand

• We assume that by 2030, the demand for energy (and by extension, biomass and waste) is 12.5% higher

than in the Central RES scenario.

• This is based on IPCC scenarios (IPCC SRES v1.1, 2001), which show that

• Final energy demand in 2030 in A1 AIM is 669 EJ

• Final energy demand in 2030 in B1 IMAGE is 523 EJ

• Since our BAU and Central RES scenarios are designed as intermediate scenarios, their final energy demand

is taken as the midpoint at 596 EJ. Therefore the final energy demand in our High Growth scenario is

increased by 12.2% from BAU

Proportion of

this from

woody

biomass

• All assumptions are the same as for central RES except for transport, where high technology development

leads to

• In the US the share of 2G biofuels in total biofuels is increased to 10% of biofuels in 2015; 40% in

2020; and 60% in 2030. The ROW is assumed to be the same as the US

• EU targets remain the same as in Central RES (20% of renewable fuels are 2G biofuels in 2015, 39%

in 2020). However, we have assumed that in 2030, 60% of renewable fuels are 2G, electricity or H2,

and of this, 80% are 2G biofuels (i.e. 55% 2G biofuels in renewable fuels overall). We had originally

planned to consider that the RES was not extended and so 2030 production remained at 2020 levels,

however, this would not be realistic given the level of technology development in 2G biofuels seen

worldwide

• This gives a total woody biomass demand of 6.6 EJ in 2008 and 20.3 EJ in 2030

113


114

High Sustainability

Biomass and

waste

demand

• We assume that by 2030, the demand for energy (and by extension, biomass and waste) is 12.5% lower than

in the Central RES scenario. This is based on IPCC data, as before.

Proportion of

this from

woody

biomass

• All assumptions are the same as for central RES except for

• Extension of the RED to 2030 on a constant % basis for electricity and heat – although this has little

effect as EU energy demand grows very little in this time

• Transport, where high technology development is considered as in the High Growth scenario

• This gives a total woody biomass demand of 6.6 EJ in 2008 and 16.4EJ in 2030

114


115

Annex D: Transport and processing assumptions

115

• Transport and processing needed to obtain each feedstock in the form needed for each demand grouping,

and associated data

Annex D: T&P

116

Global processing and transport assumptions

Processing

• Each feedstock must be in a suitable form for transport

• Wood processing residues:

• chips do not need further processing

• sawdust is pelletised

• other loose material is chipped at a centralised plant

• Forestry resides are already chipped at roadside

• Energy crops are in the form of willow logs and eucalyptus sticks, and are chipped

• Costs of processing are the same as the assumptions used in the UK (see following slides)

International

transport

• Wood processing residues are generated at a plant/sawmill, forestry residues at the nearest

roadside, whereas energy crop costs already include 50km road transport to a centralised point

• We then added an estimated average transport distance for global woody biomass resources,

as set out below. In reality, many resources would be used close to the source of production,

and many transported much further.

• After any necessary processing, each resource is transported a distance of 200km by

road in the country of origin. Costs from Suurs (2002) include loading, transport,

unloading and return journey: chips 5p/odt/km, pellets 4.7p/odt/km

• Costs for sea transport are then added for a distance of 1500km. Suurs (2002) gives

0.6p/odt/km for pellets, 1.2p/odt/km for chips. Costs include two port costs, loading and

unloading costs and one-way transport (i.e. non-dedicated vessel), for an indicative

international sea transport distance of 1500km.

116

Annex D: T&P

117

UK processing assumptions

Chipping

• Cost of chipping:

16t/hr centralised

chipper £2.35/odt

(Gigler 1999)

Pelletising

• 13.7t/hr plant

£12.5/odt

(Nordicity Pellet

logistics 2007)

Chopping

• Assumed same

as chipping in the

absence of

reliable data

Drying

• Cost for drying

from 35% dry

matter to 90%

dry matter of

£98/odt, from

Sowa (1994)

117

Feedstocks Original form

Desired final form

Large thermal:

allDomestic Waste/fuels AD Landfill gas

Forestry residues Chips - Pellets -

Soft stemwood Logs Chips - Chips

Hard stemwood Logs Chips - Chips

Sawmill co-product: chips Chips - Pellets -

Sawmill co-product: sawdust Sawdust Pellets Pellets Pellets

Sawmill co-product: bark Bark Chips Chips

Arboricultural blowback: logs Logs Chips - Chips

Arboricultural blowback: chips Chips - Pellets -

Arboricultural landfillings: logs Logs Chips - Chips

Arboricultural landfillings: chips Chips - Pellets -

Wheat straw Bales Chopped Chopped

Oil seed rape straw Bales Chopped Chopped

Energy crops Chips Average EC* Pellets Average EC*

Wet manures Slurry/Farmyard manure -

Dry manures Poultry litter - -

Sewage sludge Sludge Dried sludge Dried sludge -

Waste wood: clean Pieces Chips Pellets Chips

Waste wood: contaminated Pieces Chips

Paper/card waste Loose pile - -

Garden/plant waste Loose pile - -

Food/kitchen waste Loose pile - -

Textiles waste Loose pile - -

Landfill gas Gas -

Imports: chips Chips - Pellets -

Imports: pellets Pellets - - -

• UK Energy crops are SRC willow and poplar, in the form of chips (78%), and miscanthus, in the form of bales (22%). Weighted

average transport and processing costs are therefore used

Annex D: T&P

118

UK transport assumptions

118

FeedstocksCurrent location

Large

thermal: allDomestic Waste/fuels AD Landfill gas

Large thermal:

allDomestic Waste/fuels AD Landfill gas

Forestry residues Forest roadside - Pellets - 50 50 50

Soft stemwood Forest roadside Chips - Chips 50 50 50

Hard stemwood Forest roadside Chips - Chips 50 50 50

Sawmill co-product: chips Sawmill yard - Pellets - 50 50 50

Sawmill co-product: sawdust Sawmill yard Pellets Pellets Pellets 50 50 50

Sawmill co-product: bark Sawmill yard Chips Chips 50 50

Arboricultural blowback: logs Depot Chips - Chips 50 50 50

Arboricultural blowback: chipsDepot - Pellets - 50 50 50

Arboricultural landfillings: logsDepot Chips - Chips 50 50 50

Arboricultural landfillings: chips Depot - Pellets - 50 50 50

Wheat straw Farm gate Bales Bales 50 50

Oil seed rape straw Farm gate Bales Bales 50 50

Energy crops Farm gate Average EC Pellets Average EC 50 50 50

Wet manures Farm gate - 10

Dry manures Farm gate - - 50 10

Sewage sludge Works gate Dried sludge Dried sludge - 50 10 0

Waste wood: clean Site skip Chips Pellets Chips 50 50 10

Waste wood: contaminated Site skip Chips 10

Paper/card waste Handling facility - - 10 10

Garden/plant waste Handling facility - - 10 10

Food/kitchen waste Handling facility - - 10 10

Textiles waste Handling facility - - 10 10

Landfill gas Landfill - 0

Imports: chips UK port - Pellets - 50 50 50

Imports: pellets UK port - - - 50 50 50

Transport costsFixed Variable

Reference£/odt £/odt/km

Pellets 0.034Suurs 2002, adjusted for inflation. Includes fixed and variable costs for 50km out and 50km return journey

Chips 0.101Logs 0.065Bales 0.081Slurry/Farmyard manure 11.173 0.293

Biocap Uofaweb model 2005, exchanged and adjusted for inflation. Poultry litter 4.907 0.090Dried sludge 3.272 0.060

Annex D: T&P

119

Scenarios summary


UK power, heat and

fuels policy

Existing as in White

Paper, constant to

2030

To meet 2020 RED.

Constant generation

level after

Extended RED to

2030

To meet 2020 RED.

Constant generation

level after

Global bioenergy

policyCurrent policy Current policy + RED

Extended RED to

2030 + Increased 2G

biofuels targets

globally

RED + Increased 2G

biofuels targets

globally

Global food

demandCentral projection Central projection Central projection Increased projection

Global energy

demandIEA BAU projection IEA BAU projection

IEA BAU projections

-12.5%

IEA BAU projections

+12.5%

Land use for 1G

biofuel feedstocksContinued expansion Continued expansion Reduced expansion Increased expansion

Land use for

energy cropsCentral Restricted Restricted Central

UK waste

generation Current trend Current trend

Growth rates reduced

by 0.75%

Growth rates

increased by 0.25%

Technology

development and

resource extraction

Mid Mid High High

119

1. Introduction

Documents

Biomass Supply Curves for the UK E4tech 2009