Clean Fuel and Vehicles in Central & Eastern Europe & Turkey-Szentendre-27-28 October 2005 1 Fatin ALI MOHAMED Energy and Clean Production Branch UNIDO

Clean Fuel and Vehicles in Central & Eastern Europe & Turkey-Szentendre-27-28 October 2005

1

Fatin ALI MOHAMED Energy and Clean Production Branch

UNIDO

Biodiesel

A solution for

Energy Security, Environment & Rural Development


2

Contents

1. What is biodiesel? 2. Why Biodiesel?3. Review of the present situation in Europe4. Reflections & Concerns5. Key elements to successful biodiesel production6. Conclusions and Possible next steps promoting

production & use of biodiesel


3

• Together with bioethanol, biodiesel is a biomass based transport fuel (also for stationary internal comp.engines)

• Can substitute fossil diesel in vehicle engines - either as 100% biodiesel or partially in a blend

What is Biodiesel?


4

• Strategy papers indicate : alongside renewably-produced hydrogen, biofuels represent an important potential route for achieving the goal of zero-carbon transport.

What is Biodiesel?


5

• Produced through transesterification of fat molecules; in Europe mainly Rapeseed & sun-flowerseed are used

What is Biodiesel?

Transesterification

Jatropha oil Methanol (approx. 10%)

Ester interchange(Transesterification)

Separation

Clarification

BIODIESEL Glycerine (approx. 10%)

(+ Catalyst)(+ Catalyst)

Clarification


6

• On life cycle base, CO2 emissions of Biodiesel is between 100 to 78% < fossil diesel, depending on, e.g., intensity of Agric.mechanisation used for growing oil crops

• Carbon Sequestration for emission trading

Mitigating GHG Emissions:

Graphic source: © University of Hohenheim

Why Biodiesel?


7

• Health Benefits• Ozone layer - Reduces CO2 emissions with~78% in

comparison with fossil diesel, on life cycle base

• Fewer soot and particle emissions

• Environmental Benefits• non-toxic Biodegradable

• Closed CO2 cycle, thus reduces production of GHG

• Sulphur free

Why Biodiesel?

Benefits seen in Biodiesel:


8

• Benefits for Engine• Optimized viscosity and thus, reduction of engine wear

• Macro-Economical Benefits• Employment creation• Increased security of energy supply• Conservation of foreign exchange by reducing

import quotas and improving country’s balance of payments

Benefits seen in Biodiesel:

Why Biodiesel?


9

• Air pollution in cities: could be reduced significantly, biodiesel results in substantial reductions of:

– unburned hydrocarbons (67%)

– carbon monoxide (47%)

– particulate matter (47%)

Cleaner air cities

Why Biodiesel?


10

a solution to…

Air pollution in cities:

• Emissions of NOx are slightly reduced or increased (10%) depending on the engine and testing methods used. However, biodiesel’s lack of sulfur allows the use of NOx control technologies that cannot be used with conventional diesel; therefore, effectively managing NOx emissions

Graphic source: © University of Hohenheim


11

• Plantation of oil crops, especially on marginal land, improve the biodiversity

• Using Biodiesel is an appropriate option for sensitive zones with water reservoirs due to being non-toxic & Bio-degradable

Biodiversity

Why Biodiesel?


12

• On life cycle based biodiesel has a positive Energy Balance: For every one unit of energy needed to produce biodiesel, 3.2 units of energy are gained.

Preserve natural resources

Why Biodiesel?


13

Issues in CEE

• Exude from rural areas; Need to create new opportunities for rural development, income & job creation

• Needs to reduce dependency on imported fuels & to increase security of energy supply

• Obligations to meet international commitments for Global greenhouse emissions & undertake mitigation efforts

• Air pollution, especially in large cities, & health consequences; need for cleaner fuel for transport


14

• EU has set a goal: by 2010, 5,75% of energy used in transport shall be biofuels

• In Europe Biodiesel counts for ~ 80% of biofuels produced; Its quality insured with (EN14214)

Present Situation


15

• 1.4 million ha was cultivated in 2004 to produce biodiesel

• Germany is largest producer, reached already goal for 2010

• ~40 plants in Europe: Austria, CzechCzech, Germany, Italy, France, PolandPoland, Spain & Sweden

Present Situation


16

Country Biodiesel Ethanol

Austria > 100 Currently no plant

Czech RepublicCzech Republic 100 Building up the industry

Denmark 44 Experimental production

France 321 100

Germany 1088 non

HungaryHungary 2 (not commercially)

Production capacity available

Italy 419 Building up the industry

PolandPoland 1.2 36.8

Spain 70 150

Sweden 8 56

UK 15 -

Biodiesel & bioethanol production in 2004, ‘000 tons

Present Situation


17

Feedstock

• Availability & cost of feedstock (~80% of production costs),

• Availability of land: for food or fuels? Crop rotation

• Set-aside land in EU (~5-6 million ha), at least 19 million ha is needed for the 5.75% in 2010

Reflections & Concerns


18

Is it economically competitive?

• Unit cost of biodiesel from rapeseeds is ~0.52 to 0.6 Euro/l (before taxes) depending on the plant production capacity

• Feedstock costs ~80% of production costs.

• Price of diesel (at distribution station) is ~ 0.6 Euro/l.



19

• To enable market penetration & development incentive mechanisms & excise exemption are needed

• Supportive financial mechanisms, set-aside & carbon credit

• Main message is to strive to decreasing cost of feedstock (↓ agric. input & ↑ productivity/ ha) and mixing with other, less costly feedstock, e.g., Used Frying Oil


Is it economically competitive?


20

– Ensuring involvement of all stakeholders– Legislative framework – Feedstock selection, availability, price,..– Marketing strategy, segment– Process technology & quality control– Plant site selection– ….

Key issues towards successful biodiesel production chain


21

Ensuring involvement of all stakeholders

All stakeholders relevant to the production and marketing chain should be involved, have common under standing on their respective complementary roles



22

Policies framework & incentive mechanisms

• Needed to be put in place : In order to identify & set targets Ensure the financial attractiveness of oil crop plantations to farmersEnabling market creation by exempt biodiesel from taxes to be competitive with regular diesel de-taxation depending on the market segment to be promoted Promote private sector participation …



23

Feedstock availability, price,..

• Devising a strategy to ensure availability & avoid price fluctuations : storage, multi-feedstock,..

•

• Breeders, agric. researchers, extensions workers, farmers & unions are important Stakeholders to ensure best practice leading to best varieties & higher yield

• Private enterprises encouraged to participate



24

Marketing strategy, segment• Determining options :

– pure 100% for certain market segment (agr. Machinery´s or city bus fleet)

– blend, in all engines without modifications, does not need separate distribution system

• Which segment?

– City transport: less harmful emissions

– Lakes & rivers: fast biodegradability

– Drinking water areas: zero toxicity



25

Process technology & quality control

Highest & guaranteed quality to the standard

Ability to process multi-feedstock to accommodate fluctuation of feedstock price by selecting the least expensive

Highest efficiency = 100% conversion of oil (the most expensive input) to biodiesel



26

Plant site selection

To lower transportation costs of feedstock & products

E.g., near water transport facilities for large scale, in vicinity of oil mills, etc.

Access to services …



27

• There is a need to match between the benefits of establishing biodiesel production chain and the needs of CEE countries, especially: decreasing co2 emissions cleaner air

• Loss of state income due to biodiesel is compensated with tax income from economic activities and job creation through out the whole chain

Conclusions


28

Lead, so2, co2,…

Clean air

1 2 3

Three complementary ways to reach the goal of clean air:

1- Using cleaner fuels (un-leaded, de-sulpharized)

2- Less fuels/more efficient engine

3- Using Environmentally friendly fuels/biofuels

CO2

Conclusions


29

Way forward-Possible next steps

On national level

1. To compile information on the present situation regarding plans/strategies for the use of boidiesel in each country

2. For interested countries, a study could be undertaking to determine the potential for establishing biodiesel industry.


30

Way forward-possible next steps

On national level

2. Main components of the study are:.– Feedstock Supply Analysis;

– Present Diesel and/or petrol Fuel Market

– Scenarios for Future Diesel and/or petrol Consumption & Potential biodiesel Market Share

– Accordingly, determining the capacity of production, potential stakeholders,…


31

Way forward-possible next steps

On regional level

1. Raising the awareness and sharing knowledge through networking and forum activities

2. Exploring regional cooperation on the production of biodiesel


32

Thank you!

Fatin ALI MOHAMED Energy and Clean Production Branch

UNIDO

[email protected]

Tel. +43 1 26026 3279

mailto:[email protected]

Documents

Clean Fuel and Vehicles in Central & Eastern Europe & Turkey-Szentendre-27-28 October 2005 1 Fatin ALI MOHAMED Energy and Clean Production Branch UNIDO