Effect of Biodiesel Production on Life-Cycle Greenhouse Gas Emissions ... of Biodiesel Production...

1

Effect of Biodiesel Production on

Life-Cycle Greenhouse Gas

Emissions and Energy Use for

Canada

Brian G. McConkey1, Stephen Smith2, James

Dyer3, Ravinderpal Gil2, Suren

Kulshreshtha4, Cecil Nagy4, Murray

Bentham4, Darrel Cerkowniak4, Bob

MacGregor2, Marie Boehm5

1,2,4Agriculture and Agri-Food Canada,1Swift Current, SK, 2Ottawa, ON, 4Saskatoon, SK; 3Consultant, Cambridge,

ON; 4University of Saskatchewan,

Saskatoon, SK, Canada,Brian.McConkey@agr.gc.ca

2

Background

• Low agricultural commodity prices in early 2000s• Agriculture to produce food was widely viewed as an

industry with limited economic future in Canada

• Intense interest in non-food products as means of rural development

• Canada introduced mandated content of ethanol (5% of gasoline) and biodiesel (2% of diesel and heating fuels) by 2012• Environmental benefits, particularly greenhouse

gases (GHG), were important rationale

• (Energy security not an issue since Canada is major exporter of oil, natural gas, electricity, coal, wood pellets, and uranium)

3

Life-cycle analysis of biofuels is difficult

• Boundaries

• Co-products

• Direct and indirect effects on agricultural

sector

• Indirect land-use change

4

Indirect Land Use Change from Biofuel

Development

• Land-use change that results from biofuel development

• New land development to compensate for agricultural land that was producing food that is now producing feedstock for biofuel

• Farigone et al. (2008) uses simplistic analysis suggesting that take 0 to 423 years for the GHG benefits of biofuel to repay the emission of GHG from deforestation induced from the production of those biofuels

• Has emerged as major consideration in biofuel development

• Requirement for biofuels for the United States

• Canada requires consistency with United States for trade reasons

5

Canada deforests to increase agricultural land

Forest clearing in frontier area of Canada

Clearing forests to agriculture has involved 30 000 to 80 000 ha per

year over last two decades

6

1800 t CO2/ha

200 t CO2/ha

Deforestation typically releases 450-600 t CO2/ha in Canada

480 t CO2/ha

720 t CO2/ha

520 t CO2/ha

7

Canada’s GHG Emissions from agriculture

including land use and land-use change

-20

-10

0

10

20

30

40

50

60

70

80

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

Em

issio

n o

r re

mo

val (M

t C

O2 e

q)

Ag soils (N2O)

Livestock

land management change

(tillage, bare fallow)

Clearing to agriculture

Net

Sin

k

So

urc

e

8

Indirect effects

• The complexity of problem requires that project outputs can only be determined accurately in a context of a scenario of production for Canada• Capture land-use and land management changes

• Need to capture structural changes in agriculture due to bioenergy demand

• Decision to use Canadian Regional Agricultural Model (CRAM) • Primary tool for agricultural policy analysis by

Government of Canada

• Solves system of non-linear equations to maximize economic surpluses within Canadian agricultural systems

9

CRAM

General

Scenario

Economically and

physically sensible

resource allocation

Energy and GHG

Module

(Energy inputs &

GHG emissions)

Life-cycle inventory values of energy

and GHG for primary production,

transportation, bioenergy, and

primary food processing

$ GHG budget

Energy I:O

National GHG

Accounting

C Change

10

Life-cycle inventory

• Representative values of net GHG emissions for separable pieces of larger system

• Derived emissions for field operations from the Canadian F4E2 model (Dyer and Desjardins, 2005)

• Other agricultural emissions using methods of the Canadian National GHG Inventory (Environment Canada, 2009)

• Co-products based on emissions to produce those things the co-products can substitute• Feed grains for oilseed meal

• Petroleum glycerin for glycerin from biodiesel manufacture

11

Life-cycle inventory values for biodiesel

for Canada

Units Canola Soybean

Oilseed production and

transport

kg CO2 equiv. per

tonne of oilseed

988 570

kg CO2 equiv. per L of

biodiesel

2.8 3.2

Biodiesel production

(to pump)

kg CO2 equiv. per L of

biodiesel

0.3 0.5

Displacement from use

of co-products

-1.4 -2.4

Diesel fuel emissions

displaced (well to

pump plus final use)

-3.5 -3.5

Net -1.8 -2.2

12

Method - Scenarios

• Biodiesel will be part of broader bioenergy strategy in Canada

• Developed a range of bioenergy scenarios for 2017

• Based on existing medium-term economic outlook for 2017

• Scenario assumes various petroleum and carbon price

• Carbon price to reflect willingness of world to pay to reduce emissions

13

Name

Crude

Oil Price

$/bbl

Carbon

Price

$/Mg

CO2e

Proportion of

Biogenic

Ethanol

(% of

gasoline)

Biodiesel

(% of

Petroleum

diesel)

Bioenergy

(% of Coal

based

energy

substituted)

Lo Oil-Lo C 72 20 10 4 5

Lo Oil-Hi C 72 50 10 4 20

Hi Oil-Hi C 120 50 20 8 20

Hi Oil-Lo C 120 20 20 8 5

Bioenergy Scenarios

14

CRAM

General

Scenario

Economically and

physically sensible

resource allocation

CEEMA

(Energy inputs &

GHG emissions)

Life-cycle inventory values of energy

and GHG for primary production,

transportation, bioenergy, and

primary food processing

$ GHG budget

Energy I:O

National GHG

Accounting

C Change

15

Hay,

pasture

Grain Land

Biomass

crops

LAND

Food

Feed

Fuel

Livestock

Biomass

Residues

Forest

16

Current extent of agriculture in Canada

17

What is the Potential for

Expansion of the Agricultural

Land Base in Canada?

Was unknown so undertook

analysis to answer

18

19

Canada Land Inventory (CLI) Soil Capability for Agriculture

55 73 42

50% Class 5 20% Class 4

30% Class 7

20

21

22

Expansion Potential of Canadian Agricultural Land

Land Area (ha)

Area (%) of

current cropland

Class 1 and 2* land in shrubs 157,294 0.3

Class 3 and 4** land in shrubs 1,913,868 4.1

Class 1 and 2 land in forest 753,856 1.6

Class 3 and 4 land in forest 7,176,943 15.5

*Land with no significant limitations to production of common field crops

** Land suited to crop production but having limitations

23

Added increased land supply into

economic model

• Added in land supply expansion capability

• Based on land values and cost of conversion, extra

land can be cleared and brought into primary

production

• Highest quality land converted first

24

Results

25

Economics

• All biodiesel produced from canola, soybean was not competitive• Value of oilseed meal decreases so soybean

penalized compared to canola

• Soybean competes with maize • Maize is most profitable bioenergy crop because of high

grain and residue yields

• Using crop residues for bioenergy consistently more profitable than biodiesel• Canola and soybean do not produce quality or

quantity of residue to use for bioenergy

• Biodiesel only produced because of fuel mandate

• If no mandate, limited biodiesel production in Canada

26

Change in Production and Exports with Aggressive Bioenergy

Policy (Hi Oil Hi C scenario) Compared with Minimum Bioenergy

Change to Hi Oil Hi C

Production Export

Product tonnes % tonnes %

Canola

Grain -1404 -15.8 -537 -20.1

Oil -1152 -63.6

Meal -283 -8.9

Soybean

Grain -763 -32.3 0 0

Oil 0 0

Meal -321 -26.8

Wheat -1110 -2.8 -1917 -8.8

Maize +2539 10.7 -3459

(increased imports)

+388

Barley +2468 10.1 +1336 12.8

Other grains No change

27

Emission Changes for Hi Oil Hi C scenario

Source

Change in emissions

(Mt CO2 equiv.)

Agricultural Soil (N2O) -2.9

Livestock -2.7

Soil C -3.4

Fossil fuel substitution -78.7

Total -87.7

•Higher grain prices and competition for land producing pasture and forage

decreased livestock production.

•Value of C induced agricultural activities to choose those options with

lowest net GHG emissions.

28

Deforestation

• Aggressive bioenergy development increases

land values and induces increased

deforestation

29

Emissions from deforestation

Scenario Area (ha/yr)

Emission

(Mt CO2 equiv.)

2006 30 000 9.9

Lo Oil Hi C 81 000 31.2*

Hi Oil Hi C 319 000 133.7*

*Total emissions for year 0-10 after deforestation event

30

Emission Changes for Aggressive Bioenergy Scenario

Source

Change in emissions

(Mt CO2 equiv.)

Agricultural Soil (N2O) -2.9

Livestock -2.7

Soil C -3.4

Fossil fuel substitution -78.7

Total -87.7

Deforestation +133.7

Total with deforestation +46

31

Conclusions

• Biodiesel from canola and soybean in Canada provide GHG benefit

• At least 50% less than that emitted for displaced diesel fuel

• Life-cycle inventory values ignore structural changes to agriculture that result from economic effects of bioenergy development

• For Canada these reduced the emissions through indirect effects such as reductions in livestock

• GHG Reduction for biodiesel are greater life-cycle inventory• Need to consider for life-cycle analysis for policy development

• Neglecting potential deforestation, Canada can produce significant GHG savings with bioenergy

• With potential deforestation based on economics, bioenergy development causes net increase in GHG emissions

• Land-use policy regarding clearing is critical to biofuel development

• Need to consider for life-cycle analysis for policy development

32

Future work

• Use the economic modelling to refine life-cycle inventory values for biodiesel and other bioenergy pathways

• Adjust biodiesel production marginally

• Determine what grains are actually displaced by meal production

• Determine net GHG effects per unit of increased or decreased biodiesel production as an alternative life-cycle inventory value or adjustment to existing life-cycle inventory value

• More careful analysis of factors affecting decision to clear forest to include into economic modelling.

• Farmers have other values besides economics to retain forests

• Include effect land-use policy that controls deforestation

• Evaluate under future climates

• Expected climate change will shift areas of production

33

Supported by PERD (Panel on Energy Research and Development)

Thank you for your attention

Questions?