Chapter 3 ISSUES AND FINDINGS - Princeton

a

Chapter 3

ISSUES AND FINDINGS

9

Chapter 3.— ISSUES AND FINDINGS

PageHow Much Energy Can the United States Get

From Biomass? . . . . . . . . . . . . . . . . . . . . ., . . 23Wood From Commercial Forestland . . . . . . . 24Grass and Legume Herbage . . . . . . . . . . . . . . 24Crop Residues . . . . . . . . . . . . . . . . . . . . . . . . 26Ethanol Feedstocks . . . . . . . . . . . . . . . . . . . . 27Manure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27Agricultural Product Processing Wastes . . . . 27Other Sources . . . . . . . . . . . . . . . . . . . . . . . . 27Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

What Are the Main Factors Affecting the Reliabilityof Energy Supply From Biomass? . . . . . . . . . . . 30

What Are the Economic Costs and Benefits ofBiomass Fuels?. . . . . . . . . . . . . . . . . . . . . . . . 31

What ls the Potential of Biomass for DispIacingConventional Fuels? . . . . . . . . . . . . . . . . . . . . 34

Does Gasohol Production Compete With FoodProduction? . . . . . . . . . . . . . . . . . ..**.***. 39

Can Biomass Feedstocks Be Obtained WithoutDamaging the Environment? . . . . . . . . . . . . . . 39

What Are the Major Social Effects of BioenergyProduction? . . . . . . . . . . . . . . . . . . . . . . . . . . 43

What Are the Problems and Benefits of Small-Scale Bioenergy Processes?. . . . . . . . . . . . . . . 44

Technical and Economic Concerns ofSmall-Scale Wood Energy Systems. . . . . . . 44

Technical and Economic Concerns ofSmall-Scale Ethanol Production. . . . . . . . . 45

Technical and Economic Concerns ofSmall-Scale Anaerobic Digestion. . . . . . . . 46

Environmental Effects of Small-ScaleBiomass Energy Systems , . . . . . . . . . . . . . 46

PageSocial Considerations of Small-Scale

Bioenergy Production. . . . . . . . . . . . . . . . . 47

What Are the Key RD&D Needs for Bioenergy sDevelopment? . . . . . . . . . . . .OO. . . OO 48

What Are the Principal Policy Considerations forBioenergy Development? . . . . . . . . . . . . . . 49 ~

TABLE

2. Gross Energy Potential From BiomassAssuming Maximum Rate of Development . . 25

4567

8

FIGURES

U.S. Oil Consumption in 1979. . . . . . . . . . . . . 23Fuel Uses for Biomass . . . . . . . . . . . . . . . . . . 24Selected Bioenergy Costs. . . . . . . . . . . . . . . . 31Net Displacement of Premium Fuel perAcre of New Cropland Brought IntoProduction ., . . . . . . . . . . . . . . . . . . . . . . . . . 34Potential Environmental Damages/BenefitsFrom Supplying Biomass Feedstocks. . . . . . . 40

BOXES

A. —What Effects Could Ethanol ProductionHave on Food Supplies and Prices? . . . . . . 28

B. – How Do Ethanol and Methanol Compareas Liquid Fuels From Biomass? . . . . . . . . . . 36

C. –What Is the Energy Balance for EthanolProduction and Use?. ... , . . . . . . . . . . . . . 37 ~

D. — Energy Savings From Ethanol’s OctaneBoost . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

.

.

.

.

Chapter 3

ISSUES AND FINDINGS

How Much Energy Can the United StatesGet From Biomass?

As much as 17 quadri l l ion Btu (Quads) per However, the quantity ofyear could be produced from biomass sources tually will be used for energyby 2000. Seventeen Quads/yr is the energy nected to the economics ofequivalent of about 8.5 million bbl/d of oil, lecting the biomass materials

biomass that ac-is intimately con-growing and col-and convert ing

and would be over 20 percent of current U.S. them to usable energy as well as to the de-energy consumption of 80 Quads/yr (see figure mand for other uses for the biomass and for4). Assuming U.S. energy use climbs to 100 the land, water, and energy used to grow it.Quads/yr by 2000, biomass could make a sub- Numerous other factors also will influence bio-stantial contribution to the administration’s energy consumption, including the long-termgoal of 20-percent solar at that time. goals and esthetic preferences of landowners,

Figure 4.– U.S. Oil Consumption in 1979

Electricgeneration

90/0

Demand supply

Total oil consumption = 37 Quads(45% of total energy consumption)

SOURCE Monthly Energy Review Energy Information Admlmsfration Department of Energy February 1980

23

I —,1 .-

24 . Energy From Biological Processes

and the environmental effects of obtainingbiomass and converting it to energy. If crop-Iand availability is the only limiting factor, upto 12 Quads/yr could be available from bioen-ergy. However, all of the above factors to-gether could limit bioenergy use to 6 Quads/yrby 2000. The various forms of bioenergy (seefigure 5) and their potential contributions tothis 6 to 17 Quads— assuming the demand isthere— are shown in table 2 and discussedbriefIy below.

Wood From Commercial Forestland

Wood from commercial forestland* is thelargest potential source of bioenergy. Most ofthis could be obtained from the byproducts of

‘Commercial forestland is defined as forestland that IS at least10 percent stocked with forest trees or has been in the recentpast, has not been permanently converted to other uses, and iscapable of producing (although it may not be currently) at least20 ft ‘/acre-yr of commercial timber Parks and wilderness areasare not commercial forest land, but many privately owned wood-Iots are

Figure 5.—FueI

wood processing, such as sawdust and spentpaper-pulping liquor, and from the byproductsof increased forest management practices,such as collecting logging residues, convertingstands (via clearcutting and replanting) to treeswith a higher market value, thinning stands toenhance the growth of the remaining trees, andother management techniques. At least 4Quads/yr of energy probably will be produced .from wood by 2000 with little or no Govern-ment action, and as much as 10 Quads/yrcould be produced with appropriate incentivesand forest management practices.

Grass and Legume Herbage

Another source of bioenergy is increasedgrass and legume herbage production on exist-ing hayland and on both cropland and non-cropland pasture. Production could be in-creased by applying fertilizers and managingthe crops to maximize energy production. By2000, some of the more level grasslands will beconverted to row and close-grown crops (such

.

Uses for Biomass

[ SteamElectricitySpace and water heatingCooking

Process heat (e.g., crop drying)SteamSpace and water heatingElectricityCookingStationary engines

Regional fuel gas pipeline

.

“

SOURCE Office of Technology Assessment

Ch. 3—issues and Findings ● 2 5

Table 2.—Gross’ Energy Potential From Biomass Assuming Maximum Rate of Development(does not include projected demand)

Gross energy potential’ (Quad/yr)

Source Biomass 1979 1985 2000Commercial forestland (includes mill wastes)

Hayland, crop land pasture, and noncroplandpasture

Cropland used for intensive agriculture

(Grain and sugar crop option).

.

(Grass or short-rotation tree option)

Manure from confined animal operations

Agricultural product processing wastes

Other

Wood 1.4- 1.7

Grass and legume herbage o

Crop residues o

Ethanol (from grains 0.004 (50and sugar crops) million gal/yr)

Grass or short-rotation treesc o

Biogas (for heat and electricity) Less than 0.001

0.01

Less than 0.1

3 - 5

1-3

0.7-1

0.08- 0.2b

(l-3 billiongal/yr)

0.3- 1.6b

0.1

0.1

Less than 0.1

5-100 - 5b

0.8- 1.20 - 1b

(0-12 billiongal/yr)

0 . 5b

0.1 -0.3

0.1

UnknownTotal 1.4- 1.7 5.3-11 6- 17d

aDoes not Include deductions for cultivatlon and harvest energy, losses. or end-use efflclencYbThese Categories are not addltlve because they use some of the same landcAssumlng 4.ton/acre. yr yield In 1985 and 6-ton/acre.yr In 2000.dupper l[m(t~ ,n 2000 for vfood, ~ra~~ and /egume herbage CrOp res)dues, and blogas In addition, about 2 billion gal/yr of ethanol are assumed tO be produced from

grains and sugar crops

SOURCE Off Ice of Technology Assessment

Photo credit USDA —Soil Conservation Service

The fuel value of wood harvested during thinning operations is an added incentive for intensified forest management

26 Ž Energy From Biological Processes

as corn and wheat) to supply food and feed re-quirements, reducing the amount of Iand thatcould be available to grow grass and legumeherbage for energy. On the other hand, if thedemand for food and feed is less than antici-pated relative to the available cropland andsome of the land in herbage production is re-planted with fast-growing grass, legume, ortree hybrids, the bioenergy potential of thisland could increase. There is, however, noassurance that cropland will be available forenergy uses in 2000, and attempting to obtainenergy from cropland (other than from cropresidues) could lead to inflation in food pricesin the long term.

Crop Residues

About 20 percent of the material left in thefield after grain, rice, and sugarcane harvests(crop residues) could be a source of bioenergy.(The other 80 percent of crop res idues i sneeded to protect the soil from erosion orwould be lost during harvest or storage. ) For anaverage crop yield, about 1 Quad/yr of cropresidues could be collected and used for en- ,ergy without exceeding current soil erosionstandards. Local variations in crop yields, how-ever, might limit the reliable and usable supplyto about 0.7 Quad/yr. This supply is likely to in- ‘crease in rough proportion to increases in cropproduction.

Photo credit USDA, David Brill

High-yield grasses could be a significant source of bioenergy


.

Ethanol Feedstocks

The principal limit on energy uses of grainsand sugar crops is the potential for farm com-modity price increases as energy crop use risesand the amount of inflation in food prices thatis acceptable for energy production (see boxA). It is likely that at least 1 billion gal/yr ofethanol f rom grains and sugar crops —orenough to displace approximately 60,000 bbl/dof gasoline or about 0.8 percent of current gas-oline consumption — can be produced withoutinflationary impacts in the farm sector. Con-servative economic calculations indicate thatfarm commodity price rises could begin to besignificant at the 2-billion-gal/yr level. * De-pending on the actual response in the agricul-tural sector–the amount of new land broughtinto production, the degree to which grainscan be bought in export markets, and theamount of crop switching** that is practical —it may be possible to obtain still more ethanolwithout excessive infIation.

A production capacity of slightly more than3 billion gal/yr might be achieved by mid-1985if construction starts on 20 new 50-milI ion-gal/yr distilleries during each of the years 1981,1982, and 1983. This production capacitycouId displace about 1.5 to 2.5 percent of cur-rent gasoline use. However, if significant farmcommodity price increases resulted, theywouId Iimit growth in capacity.

Beyond 1985, the land available for inten-sive production of energy crops could eitherincrease or decrease, depending on future de-mand for food, the average yields achieved,and the food price rises needed to inducefarmers to bring new land into production.There are, however, plausible scenarios inwhich no surplus cropland capable of support-ing row and close-grown crops wilI be avail-able for energy feedstock production by 2000.

*SEW “Alcohol Fuels” In ch 5 and app B* *The most productive crop for ethanol production that IS be-

ing grown on large areas of U S cropland IS corn Because thebyproduct of producing ethanol from corn can be ~ubstltuted toa certain extent for soybean production, the I nflat Ionary Impactsof ( ropla nd expa ns Ion are reduced as long as the byproduct I S

f uliv ut it Ized (5ee bOX A)

To the extent that cropland is available forintensive energy crop production, greaterquantities of liquid fuel can sometimes be ob-tained per new acre cultivated and with morebenign environmental impacts by plantingfast-growing grasses, legumes, or short-rotationtrees (Iignocellulose crops) rather than grainsor sugar crops (see “What is the Potential ofBiomass for Displacing Conventional Fuels?”).The approximate quantities of biomass avail-able with this option also are shown in table 2.

Manure

About 0.3 Quad/yr of biogas (methane-car-bon dioxide gas mixture) could be produced byanaerobic digestion of the manure from con-fined livestock operations. Much of this biogaswould be used for heat or to generate electrici-ty for use onfarm and for sales to electricutilities. The economics of producing the bio-gas, however, may limit its energy potential toless than 0.1 Quad by 1985. Improvements indigester technology could reduce the costs sothat much of the manure could be used for en-ergy by 2000.

Agricultural Product Processing Wastes

The majority of byproducts from the food-processing industry already are used for ani-mal feed, chemical production, or other non-energy uses. About 0.1 Quad/yr, including sug-arcane bagasse, orchard prunings, cheesewhey, and cotton gin trash, either are beingused (e. g., some sugarcane bagasse and cheesewhey) or could be available for energy.

Other Sources

Energy also can be obtained from variousunconventional types of biomass, such as oil-bearing plants, arid land crops, native range-Iand plants, and both freshwater and saltwateraquatic plants. Many unconventional cropswould have to be grown on land suitable fortraditional crop production and their potentialwould be limited partly by the availability ofthis land. The arid land crops, however, couldbe cultivated on cropland where there is slight-ly less ra infal l or i r r igat ion water than isneeded to cultivate traditional crops success-fully. Freshwater plants might be cultivated in

28 ● Energy From Biological Processes

Ch. 3—issues and Findings ● 29

.

channels near existing bodies of water or inbasins constructed on land unsuitable for cropproduction. Saltwater plants such as kelpmight be cultivated on large ocean farms builtto support the plants near the surface of thewater, without competing for land or for foodand fiber production. Kelp currently is culti-vated off the coast of China, and is harvestedfrom natural kelp beds off the coast of theUnited States and elsewhere for the produc-tion of emulsifiers. Water-based plants appearto have a potential for high yields. * At present,however, technical and economic uncertain-ties about yields, harvesting and cultivationtechniques, and land availability are too greatto assess the long-term potential of these bio-energy sources.

Total

The amounts of energy available from thevarious major biomass sources are not com-pletely additive. The conversion of some for-estland (perhaps as much as 30 miIIion acres or6 percent of the commercial forestland) tocropland and other uses is not likely to have alarge effect on the availability of wood energy.Similarly, there is no direct relationship be-tween the energy that can be obtained fromanimal manure or agricultural product proc-essing wastes and the other categories. * * How-ever, the various cropland categories are inter-dependent and the quantities of bioenergythat can be available are difficult to predict.

Strong demand for land for intensive agri-culture, either for food and feed or for energy,would decrease the quantity of hayland andcropland pasture. On the other hand, in-creased grain or sugar crop production couldincrease the quantities of crop residues slight-

‘Frrergy From Ocean Kelp Farms (Washington, D C Off Ice ofTechnology Asw$sment, draft, June 1979), to be published ascomm Ittee print

*See “Unconventional Crops” In VOI II* ‘Price changes for farm commodltles, however, can change

the demand for and production of the products of con f[ned anl-ma I operations and thereby Inf Iuence the energy obtained fromanlma I wastes

ly, although the marginal quality of much ofthis new cropland would limit the amount ofresidue that could be removed. Finally, im-provements in crop yields could increase theland available for energy production and theamount of energy obtained from this land.

These factors are likely to have only a smallinfluence on the 1985 estimates for bioenergysupply. By 2000, however, the uncertainties arequite large because both future crop yieldsand demand for food are unknown. Demandfor additional cropland in the Eastern UnitedStates also could result if irr igation watershortages develop on western croplands. Fur-thermore, if there is a large shift from corn-fedto grass-fed beef in order to increase the sup-ply of corn for ethanol, then the quantities ofgrass available for energy would decrease.More cropland would be available by 2000,however, if the conversion of cropland to otheruses, such as subdivisions and industrial parks,is halted. 2

Because of these uncertainties, no truly sat-isfactory estimate for the upper Iimit for ener-gy from the agricultural sector can be derived.The higher total for 2000 given in table 2–17Quads/yr-–has been calculated by assumingfirst, that the upper limit of 65 million acres ofcropland can be used for energy productionand that this land is planted with grasses yield-ing an average of 6 ton/acre-yr, and second,that about 2 billion to 3 billion gal/yr of etha-nol could be produced by crop substitutions(e. g., corn for soybeans). This would result inabout 5.1 Quads/yr of grass, 1.2 Quads/yr ofcrop residues, and 0.2 to 0.3 Quad/yr of etha-nol, bringing the total to about 6.5 Quads/yrfrom these sources.

‘Otto C Doerlng, “Cropland Ava/Jab/llty for Btomass Produc-tion,” contractor report to OTA, Aug 6, 1979, see also R I Dlder-lksen, et al , “Potential Cropland Study, ” U S Department ofAgriculture, Soil Conservation Service, Statlstlcal Bulletln No578, October 1977, and Env/ronmenta/ Qua/lty The Ninth Annua/Report o~ the Council on Environmental Qual/ty (Washington,D C Council on Environmental Quallty, December 1978), GPOstock No 041-001 -00040-8


What Are the Main Factors Affecting the Reliability ofEnergy Supply From Biomass?

Increasing reliance on bioenergy means ty-ing energy supply to complex nonenergy mar-kets and to raw materials whose supply andprice can be expected to fluctuate withchanges in growing conditions. Insofar as thecountry’s overall energy system is concerned,however, the reliability of biomass fuels is like-ly to become an important issue only whenvery large amounts enter the supply stream.

In the case of wood, the resource with thegreatest energy potential, there may be uncer-tainty concerning both price and availabilityof raw materials for energy production, espe-cially for new users of this resource. Within theforest products industry, which is likely to ac-count for much of the expansion to the level of5 to 10 Quads/yr in the next two decades, aportion of supply often is assured because thematerial used for energy is a byproduct of on-going operations. Even when use exceeds theavailable byproducts, forest products compa-nies are likely to be in a position to secureaddit ional wood from establ ished supplysources.

Outside of this sector, however, supply relia-bility may pose a greater problem because ofcompetition, often localized, between the for-est products industry and other users of wood.This is because in some areas traditional forestproducts industries may require a large part ofthe wood being harvested. In those cases, tem-porary shortages of woodchips would affectthe fuelwood users the most, because the for-est products industries would bid up the priceof chips to satisfy their process requirementsand the other wood users would have to ab-sorb most of the temporary shortage. In otherareas, where fuel uses for wood dominate, sup-ply variations would tend to be less severe.

Experience within the forest products indus-try indicates that even with a large wood sup-ply infrastructure, there will be seasonal andyearly price and supply variations. Therefore,wood energy appears more attractive to users “who can switch to other fuels during tempo-rary shortages and when prices are high, orwho are able to make long-term supply ar- -rangements.

For ethanol produced from grains and sugarcrops, price and supply are Iikely to be subjectto the same uncertainties that affl ict farmcommodities in general: weather, pests anddisease, international and domestic marketconditions, changes in land values. Energy-ori-ented farm programs and increased fuel orcrop buffer stocks may be desirable to assuresupply stability and to control energy pricefIuctuations.

To a lesser extent these uncertainties alsomay be expected in the case of heavy depend-ence on grasses and crop residues. Biogas fromthe digestion of animal wastes is unlikely toplay a large enough role in domestic energysupply to cause concern, although it, too, mayfluctuate somewhat as a result of changes inlivestock population and feeding practices.But agriculture is highly sensitive to energysupply fluctuations, and the reliability of on-farm stills and digesters will be an importantfactor in commercialization.

In the very long run, one of the advantages -

of bioenergy is that it is renewable and neednever be depleted provided that the land re-mains dedicated to th is use. Poor manage- -ment, however, may damage the resource basethrough erosion and deforestation and forcean eventual decline in production.

Ch. 3—Issues and Findings Ž 31

What Are the Economic Costs and Benefitsof Biomass Fuels?

Because biomass fuels are relatively bulkyand have a low fuel value per pound, their fuelcosts (see figure 6) are highly site specific andmay pose economic constraints not shared by

.petroleum or natural gas. For example, thesecharacteristics make the distance between pro-ducer and user crucial in calculating total en-

. ergy costs; as distance increases, total trans-portation costs rise sharply. These costs andthe dispersed nature of the resource basemean that bioenergy users will only have ac-cess to a limited number of suppliers and thuswill be sensitive to supply fluctuations andprice increases.

Bulkiness, perishability, and the solid formof biomass fuels (at least as initially produced)also make costs and benefits for users highlydependent on their skills and their willingnessto substitute labor and more complex conver-

sion systems for the familiarity and conveni-ence of conventional Iiquid and gaseous fuels.

Another major economic obstacle is thatusers must invest more in equipment and in fa-cilities for storing fuel and disposing of ash.Equipment costs may be reduced in the futurewith the development of intermediate-Btu gas-ifiers that can be coupled directly to existingboilers, but users still will have to make largerinvestments than are necessary for oil or gas.In effect, users will be substituting capital aswell as biomass energy for depleting oil andgas resources. As prices for these premiumfuels rise, the higher capital costs of biomasssubstitution can be justified on a Iifecycle costbasis, but users and their bankers must take along-term perspective or the large initial in-vestments will not be profitable.

Figure 6.—Selected Bioenergy Costs(1980 dollars)

Wooda

(Direct combustion orgasification andcombustion)

Ethanol from combdelivered to the autoservice station

Methanol from wooda

delivered to autoservice station

Methanol from herbagec

delivered to autoservice station

Biogas from anaerobicdigestion of animalmanure— 100,000turkeys

500 swine

$2.25 $7.00

I I$12.50 $17.60

- 0 0$13.40

$16.50 $25.00

I 4$2.00 $4.00

t iI I

$12.00I 1

$24.00

$5 $10 $15 $20 $25

Dollars per million Btu

aWood at $30/dry ton.bCorn at $2.501bu.cHerbage at $45/dry ton.

SOURCE: Office of Technology Assessment


Wood energy economics are by far the mostfavorable among the biomass options. The fuelvalue of wood for heating can be derived fromthe price of #2 fuel oil, which was about$0.90/gal in January 1980. Adjusting conserva-tively for the higher cost of a wood conversionunit and for its lower conversion efficiency,this oil price corresponds to wood at about$90/dry ton, or approximately twice the 1979average price of delivered pulpwood. Further-more, wood fuel users should not have to paypulpwood prices because fuel-grade timber isgenerally of lower quality.

Initially, large quantities of fuel can be re-moved from the current inventory of low-qual-ity trees standing on commercial forestland.However, the key to renewable fuelwood sup-plies is intensive management of this land

once it has been cut over at least once. Inten-sive silviculture is also critical to the expansionof conventional forest products, because fuel-wood and conventional products are economi-cally symbiotic. Revenues from fuelwood salesoffset management costs that eventually in-crease the yield per acre of sawtimber andpulpwood. In turn, expansion of the lumberand pulp industry increases logging residuesand mill wastes that can be used as fuel. Totake advantage of this two-way relationship, along-term perspective is required. If land-owners make long-term plans, then the result-ing improvement in forest product economicscould make up to 10 Quads/yr of wood energyavailable without mining the resource base ofstanding timber or restricting feedstock sup-plies for conventional forest products. But, ifsilvicultural practices do not become more in-

.

.

●

✎

Photo credit Department of Energy

Wood energy harvests, as part of good forest management, can convert forestssuch as this to commercially productive stands


tensive and extensive, removals can outpacenew forest growth, and forests may indeed be-come a nonrenewable resource.

The distillation of grain ethanol for gasoholmay already be economical, without tax cred-its, with corn priced at $2.50/bu (or other grainscomparably priced) and crude oil at $30/bbl.However, grain prices fluctuate and, partially

. as a result of greater demand for distillationfeedstocks, could rise faster than the price ofoil. This uncertainty may discourage invest-ment in new distillation capacity or, once dis-.tilleries are built, it may raise the specter offood price inflation as demand for feedstockscompetes with demand for feed and food (seebox A).

On the other hand, having secure domesticethanol supplies during the next decade mayjust i fy costs per Btu of l iquid fuel muchgreater than the price per Btu of imported oil. *The potentially high cost of ethanol from foodand feed crops could be warranted as an insur-ance premium against import interruptionsand because ethanol displacement of importsmay slow the rate of growth of OPEC oilprices. While production costs can be esti-mated on an objective basis, judgments are un-avoidable regarding the value of import dis-placement

Virtually no grasses or crop residues current-ly are used for energy even though, along withwood, they offer the greatest resource poten-tial in the long run. Processes for convertingthese plant materials into methanol, or woodalcohol, must still be demonstrated but a simi-

‘ St>e Robert Stobaugh and Daniel Yergln, [ner~y Futufes, pp47-55 for a dlwusjlon of the real cost as opposed to the marketpri( e ot Imported oil

Iar process for wood probably is feasible withcommercial technology. Estimated total costsare competitive with or somewhat more expen-sive than ethanol from feed and food crops,and definitely more expensive than methanolfrom coal. However, methanol from lignocel-Iulose can be produced in much larger quan-tities than grain ethanol, without driving upprices of other basic commodities, by more in-tensive management of lower quality pasture-land and cropland that may not be needed forfood production in the foreseeable future.

Crop residues and Iignocellulose crops alsocan be used in intermediate-Btu gasifiers thatare being developed to be coupled to an exist-ing oil- or gas-fired boiler, thus making it un-necessary to replace existing boilers in order toshift away from premium fuels. With this near-ly commercial technology, Iignocellulose bio-mass may become competitive over a widerange of medium to small industrial and com-mercial applications. In addition, gasifierscould be used onfarm for corn drying and forirrigation pumping.

The economics of producing biogas from ma-nure through anaerobic digestion are uncleardue to limited scientific and technical data.However, it is the only biomass fuel consideredthat would not compete directly with the pro-duction of any other economic commodity.Rather, the byproduct digester effluent may beworth more than the raw manure feedstockand is also less polluting. I n either case, biogas’greatest economic value is its contribution toenergy self-sufficiency for farmers, enablingthem to displace purchased fuels at their retailcost and allowing normal farm operations tocontinue when conventional fuels are notavailable.


What Is the Potential of Biomass forDisplacing Conventional Fuels?

The three factors that will be most impor-tant in determining how much conventionalfuel (particularly oil and natural gas) can bedisplaced by biomass are: how the availablecropland is used to produce biomass re-sources; the way the biomass is converted touseful work, fuel, or heat; and how the con-verted fuel is used.

Dif ferent uses of cropland to producealcohol fuel feedstocks vary in their efficacyat displacing conventional fuels, depending onthe yield per acre of additional croplandbrought into production and on the amount ofcropland that may be freed by grain distillerybyproducts. As can be seen in figure 7, ethanol

from corn provides the greatest net premiumfuel displacement with current crop yields.This is because it is estimated that each acreb r o u g h t i n to c o r n p r o d u c t i o n w o u l d y i e l d .

enough distillers’ grain (DC) byproduct (usedas feed) to free almost 0,6 acre of average soy-bean land for additional corn production. Thebyproduct from the corn that could be grown *on this additional 0.6 acre would free still moreland, and so on. When this potential substitu-tion is accounted for, 1 acre of marginal crop-Iand plus about 2.5 acres of average croplandcultivated in corn is equivalent, in terms of ani-mal feed protein concentrate production, to2.5 acres of average cropland planted in soy-beans. Moreover, the ethanol produced from

Figure 7.— Net Displacement of Premium Fuel (oil and natural gas) per Acre ofNew Cropland Brought Into Production -

Crop

Grains and sugar cropsb

CornGrain sorghumSpring wheatOatsBarleySugarcane

Otherd

Alcohol Net premium fuel displacement per acre of marginal crop landbrought into production (energy equivalent of barrela of oil/acre-yr)

I I I I 10 5 10 15 20

Ethanol 1 I [E t h a n o l 1~1Ethanol 1 1]

[—1 No byproduct utilizationEthanol 11Ethanol 1 1 ] [—] Extra production possibleEthanol I by displacement of other

crops with byproduct

Grass or other crops with high dry-matter yields.

(4 ton/acre-y r’) Ethanol I J(10 ton/acre-yr) Ethanol [

(4 ton/acre-y r’) Methanol ~(10 ton/acre-yr) Methanol 1

aBased on 59 mll Ilon Btu/bbl, alcohol used as octane-boosting addltwe to 9asOllnebAssumes ~atlonal average energy ,nputs per acre c“lflvated and yields (on the margttlal cropland) of 75% of the national average yields between 1974-77 Ytelds on

average cropland are assumed to be the average of 1974.77 national averages This methodology IS Internally consistent, raising the average cropland yield to 1979y!elds would not slgrrlflcantly change the relatlve results If usable crop restdues are converted to ethanol, the lower value (no distillery byproduct utlllzatlon) would beIncreased by about 1 2 bbl/acre-yr or less for the grains and 26 bbl/acre.yr or less for sugarcane

cEconomlc and physical opportunities for full byproduct utdlzatlon dlmlnlsh with greater quantities Of byproduct ProductIond uncer ta ln ty of ~ 30.4 for methanol and more for ethanol from grass, since the ethanol processes are not well defined at present Assumes 1 mtlllon Btu/dry ton of

grass needed for cult lvatlon, harvest, and transport of the grass, and conversion process yields (after all process steam requirements are satlsfled with waste heat orpart of the feedstock) of 84 gal/dry ton of grass for ethanol and 100 gal/dry ton of grass of methanol

eFo ur ton/acre.yr can be achieved with current grass varieties grown on marglflal croplandSOURCE. Office of Technology Assessment, yields from USDA, Agrlcu/tura/ Statistics, 1978

.

*


the corn could have a net annual premiumfuels displacement of the energy equivalent ofnearly 15 bbl of oiI per acre of marginaI crop-Iand brought into production, if the ethanol isused as an octane-boosting additive i n gaso-hol. Other grain and sugar crops have loweryields per acre or an uncertain byproduct cred-it and thus would displace substantially lesspremium fuel,

In practice, however, several factors willlimit the potential premium fuel displacement

● per new acre for corn. First, as ethanol produc-tion increases the price of corn is expected torise and distillery feedstock and animal feedbuyers wil l shift to other grains until theirprices equalize with corn. Second, as the pro-portion of DC (or similar gluten byproduct) inanimal feed increases, its value as a soybeanmeal substitute declines. Finally, much of thepotential croplands are poorly suited to corn.

Thus, as the fuel alcohol industry is develop-ing, the best energy use of medium-qualitycropland brought into production is to growcorn and use the byproducts fulIy. But as etha-nol production increases and the potential forcrop substitution decreases, cuItivating grassesor other crops with high dry matter yields willbecome more effective in displacing conven-tional fuels. As shown in figure 7, these cropsalready have a greater displacement potentialthan corn when the DC byproduct is not used.With improved grass yields per acre, their dis-placement potential could be greater regard-less of whether or not the byproduct is used asa soybean substitute. Nevertheless, other crop-switching schemes may be possible and theywarrant further investigation.

The second factor that will be important indetermining how much conventional fuel bio-mass can displace is the choice of conversionprocesses. As discussed previous ly, wood,grasses, crop residues, and other Iignocellu-Iosic materials represent the greatest quan-tities of biomass available in the near to mid-term. The three processes for using these feed-stocks are direct combustion, gasification, andliquefaction to alcohol (methanol or ethanol).Gasification and direct combustion are themost energy-efficient processes and liquidfuels production the least, but taking advan-

tage of the octane-boosting properties of alco-hols in gasoline blends can make the optionsmore comparable. *

Of the three converted energy forms themost versatile is alcohol while the least isdirect combustion. Alcohol fuels can be usedin the transportation sector as well as for allthe stationary fuel uses for which one can usesynthetic gas from biomass (see box B for acomparison of ethanol and methanol as Iiquidfuels from biomass). Used as a standalone fuel,10 Quads/yr of biomass converted to the alco-hols technically may be able to displace al-most 5 Quads/yr (equivalent to about 2.5 mil-lion bbl/d of fuel oil) of oil and natural gas by2000. As an octane booster in gasoline-alcoholblends, alcohol has a higher net displacement(see boxes C and D), but that displacement isl imited because the increased savings de-creases with blends having a higher alcoholcontent. I n addition, alcohol-fueled automo-biles could be 20-percent more efficient thantheir gasoline counterparts. Taking these fac-tors into account would result in a displace-ment of about 3 million bbl/d of oil in thetransportation sector. * *

Direct combustion is l imited by existingtechnology to applications such as boilers andspace and water heating. Policy and econom-ics already are acting to remove premium fuelsfrom the large boiler market in favor of coal orelectricity Therefore, combustion of solid bio-mass will join coal and direct solar in compet-ing for displacement of oil and natural gas. Ifused primarily in the residential/commercialsector, it may be technically possible for directcombustion of biomass to substitute for asmuch as 9 Quads/yr of oil and natural gas(equivalent to about 4.5 million bbl/d of oil) by2000.

Gasification may provide the largest poten-tial for displacement even though it is limitedto stationary sources. This is because it can beused for applications, such as process heat, forwhich solid fuels are not practical and which,therefore, would otherwise continue to needoil or natural gas. These uses, plus space and

‘See “Energy Balances for Alcohol Fuel” In VOI I I* *See the dlscusc.lon on fuel dl~placement at the end of ch 4


Box B.--How Do Ethanol and Methanol Compareas Liquid Fuels From Biomass?

Ethanol from grains and Methanol from Iignocellulosic Ethanol from Iignocellulosicsugar crops materials. materials

Commercial readinessCommercial technology and - Commercial technology with oneplants in operation. facility using wood in the plan-

ning stages; needs to be demon-strated using grasses and residues,etc.

Uncertain; could be constrainedby nonenergy demand forcropland.

Expected to be about the same asfuel methanol but probablygreater than methanol from coal.

If used as an octane-boosting ad-ditive and distilled without usingpremium fuels will have a posi--

tive net premium fuels balance;balance would be negative ifused as a standalone fuel andproduced from energy-intensivesources of grain.

New car warranties cover use of10% blends; manageable problemin small number of cars withphase separation, fuel filter clog-ging; rubber and plastic coulddeteriorate in some cars.

Limited due to production poten-tial; would require engine modifi-cations; would improve auto effi-ciency.

Can be used in diesel enginesfitted for dual fuels; will displaceup to 30 to 40% of diesel fuelper engine.

Can be used in stationary applica-tions (e.g., gas turbines); minorend-use modifications will beneeded.

strained by the Ieadtime for con-structing new facilities.

Production cost par BtuExpected to be about the same asfuel ethanol although probablygreater than methanol from coal.

Net gasoline displacementWill have a positive net premiumfuels balance. If used as anoctane-boosting additive could becomparable to or perhaps slightlybetter than grain ethanol, buteconomic and most energy-effi-

rJtems need to be determined.

New car warranties do not coveruse of methanol blends. greaterpotential for phase separation,vapor lock, and materials damagethan grain ethanol; may requireother additives.

Use as standalone fuelConsiderably greater potential;will require engine modifications;would improve auto efficiency.

Use in dieselComparable to grain ethanol.

Use in stationary applications Comparable to grain ethanol.

Needs to be developed anddemonstrated to be economical

Uncertain due to R&D needs.

Uncertain; if produced with cur-rent technology would be moreexpensive than ethanol fromgrain or methanol; after R&D -

could be comparable.

Expected to be comparable tomethanol if premium fuels notused as distillery boiler fuel.

Same as grain ethanol.

Comparable to methanol,

Comparable to grain ethanol.

Comparable to grain ethanol.

Potential for environental damage in obtaining the feedstockHighest potential. No significant potential for waste Comparable to methanol.

products as feedstock; somepotential for crop residues butnot if managed properly; highpotential for wood if not man-a g e d p r o p e r l y .

Potential for air pollution at end useMixed effects in mobile sources; Same as grain ethanol. Same as grain ethanol.mainly improved emission char-acteristics in stationary sources,but effects of potential increasein aldehyde emissions are uncer-tain.

.

*

.


Box C.-What Is the Energy Balance for Ethanol Production and Use?

Roughly the same amount of energy is required to grow grains or sugar crops and convertthem to ethanol as is contained in the ethanol itself. Consequently, if premium fuels (oil and natu-ral gas) are used to supply this energy and if the ethanol is used solely for its fuel value (e. g., as inmost onfarm uses), then ethanol production and use could actually result in an increase in U.S.consumption of the premium fuels. (Note that no such problem exists with methanol production.)

A net displacement of premium fuels can be achieved, however, by taking three steps. First, ifthe distillery is fueled by coal or solar energy (including biomass), then in most cases less premi-um fuel will have been used to produce the ethanol than it contains. For most sources of grainsand sugar crops, each gallon of ethanol will contain the energy equivalent of 0.2 to 0.5 gal of gas-oline more than the energy ’needed to grow and harvest the crop. (The actual value will depend onfarming practices and yields.) In some extreme cases, such as grain sorghum grown in poor soil,however, the farming energy may still be greater than the energy content of the resultant ethanol.

Second, if the ethanol is used as an octane-boosting additive to gasoline, rather than for itsfuel value alone, then substantially more premium fuel can be displaced. Because the oil refineryrequires less energy if it produces a lower octane gasoline, the energy equivalent of up to 0.4 galof gasoline can be saved at the refinery for each gallon of ethanol used as an octane-boosting ad-ditive (see box D for a discussion of the uncertainty associated with this estimate). An additionalsaving may be obtained at the point of use because automobiles appear to obtain better mileagewith gasohol than would be expected from its energy content alone. Various road tests have re-sulted in widely varying estimates for the size of this savings, but laboratory tests and the averageof all road test data are consistent with a savings of 0.15 gal of gasoline per gallon of ethanol withthe existing fleet. (See vol. II “Use of Alcohol Fuels.”)

Third, distilleries can take advantage of the feed value —and consequent energy credit — fortheir byproduct (distillers’ grain or DG). With the feed rations commonly used today, DC can be asubstitute for soybean meal* or other protein concentrate. The credit for displacing soybeanmeal is the energy equivalent of slightly less than 0.1 gal of gasoline per gallon of ethanol.

The above factors combine so that each gallon of ethanol produced from corn has the poten-tial to displace premium fuels with the energy equivalent of up to 1 gal of gasoline. Whether thispotential is actually achieved will depend primarily on the fuel used in the distillery and the enduse of the ethanol.

*M Poos and T. Klopfenstein, “Nutritional Value of By-Products of Alcohol Production for Livestock Feed,” Animal Sci-ence Publication No. 79-4, University of Nebraska, Lincoln. Claims that DC can reduce the amount of corn needed in ani-mal feed are based on studies using feed rations substantially different from those used commercially and therefore are notapplicable (see “Fermentation” in vol. II).


Box D.-Energy Savings From Ethanol's Octane Boost

There is considerable uncertainty about the premium fuel savings obtainedas an octane-boosting additive to gasoline. Estimates made by several groupszero to more than 0.5 gal of gasoline equivalent per gallon of ethanol used. The

by using ethanolrange from nearpotential energy

savings will vary according to the octane boost attained (if butane must be removed from the gas-oline in order to compensate for the increase in vapor pressure caused by the ethanol, the octaneboost will be reduced), specific refinery characteristics (such as process design and the yield andoctane level of gasoline produced), and the type of crude being processed, If the energy savingsfrom ethanol represented the major economic incentive to the refiner, then refineries with thehighest potential for energy savings would be the most likely to use it and savings would be maxi-mized. Some refineries, however, may have additional incentives for using ethanol, including cap-ital savings and greater gasoline yield (coupled with lower yields of process gas, butane, etc.)from reduced reforming requirements, and access to stronger markets caused by differential taxexemptions for gasohol. These incentives may not coincide with maximum energy savings.

For purposes of calculation in this report, OTA uses a value of 0.4 gal of gasoline equivalentfor each gallon of ethanol used. This value corresponds to an octane boost of three (R+M)/2 octanenumbers, (which OTA considers reasonable for a 10 percent ethanol blend with no adjustment forvapor pressure), and a gasoline pool octane of 91 (which should be approached as the percentageof cars using lead-free regular gasoline increases and the octane requirements for these cars in-creases as it has in the past). Because the value is based on a number of simplifying assumptions,it should be considered as speculative. (See “Use of Alcohol Fuels” in vol. I I for a detailed discus-sion of the basis for this estimate and the uncertainty associated with it.)

water heating, will account for nearly all thestationary uses of premium fuels by 2000. Theprincipal constraint is the low-Btu content ofairblown biomass gasification which will Iimitthese uses to close-coupled gasifiers due totransportation costs. From the 10 Quads/yr in-crement, it may be technically possible for gas-ification to displace as much as 9 Quads/yr(equivalent to about 4.5 million bbl/d of oil) ofoiI and natural gas by 2000.

Although biomass clearly has the potentialto displace large quantities of premium fuels,

one of the major effects of a large penetrationof biomass probably will be less coal use thanwith no biomass. Coal, too, can be convertedto synthetic gas and methanol as well as othersynthetic Iiquids, and will compete for applica-tions currently using oil and natural gas. In ad-dition to the important economic questions ofresource and conversion costs, issues such asrelative environmental effects, scale of opera-tion, and renewable versus depletable re-sources will play a major role in guiding policyand market choices between biomass andcoaI. .

.

Does Gasohol Production Compete WithFood Production?

It has been widely claimed that the byprod-uct of making ethanol from corn is a betterfeed than corn and, therefore, that gasohol willnot cause food-fuel competition. OTA’s anal-

. ysis indicates, however, that the byproduct ofmaking ethanol from corn is not better orworse than grains, but simply different. It is

, not a substitute for grain, but rather more near-ly a substitute for protein concentrates, suchas soybean meal, used in animal feed.3

Despite this substitution of distillery byprod-uct for soybean meal, the quantity of croplandneeded to grow corn for ethanol — and thus itsprotein concentrate byproduct– is at least 30to 40 percent greater than the quantity of landneeded to grow soybeans for an equivalentamount of protein concentrate. *

Although additional cropland is physicallyavailable for expansion of the acreage underintensive cultivation, typical problems with

‘ M I Poos and T K Iopfen;teln, “Nutrltlonal Value ot Bv-Procl-

u cts ot A 1[ ohol Produ c t ion tor L Iveftoc k F wcjf, ” A n I ma I Sc wnce

Publ I( atlon No 7%4, Cooperative F xtenst Ion Serv I( e, Un iv~rslty

o t Nebra\k a, [ I n c oln See d l~o ‘‘ Hvprocj Llct $, L/ncjer ‘ Fermenta-

tion” In vol 1 I

* See ‘‘Ag,rl{ ulture ” In VOI I I

this land include low productivity and periodicdrought or flooding. These problems result inlower crop yields per acre and greater sensitivi-ty to weather than average lands used for in-tensive crop production today, increasing theeconomic cost and risk of farming. Conse-quently, it will be necessary to raise farm com-modity prices in order to make it profitable forfarmers to increase the quantity of land undercultivation, although it is not known exactlywhat price rises will be necessary for any givenlevel of crop land expansion.

This increase in farm commodity prices isthe basic mechanism through which food andfuel compete. Consequently, although use ofthe distillery byproduct as feed reduces thefood-fuel competition (by reducing the quanti-ty of new cropland needed for a given level ofethanol production), it does not eliminate it.

Because of the flexibility in the agriculturalsystem, however, the increase in average feedprices probably will not be noticeable untilsignificantly more ethanol is being producedthan at present (see box A). Moreover, therewill be annual fluctuations in feed prices thatare not directly related to ethanol production.

Can Biomass Feedstocks Be Obtained WithoutDamaging the Environment?

A portion of the potentially available bio-mass feedstocks may be obtained with few ad-verse effects on the environment. For example,perennial grasses and legumes appear to be ca-pable of supplying as many as 4 to 5 Quads/yrwithout transforming other valuable ecosys-tems’ or causing significant erosion or otherdamage, Similarly, obtaining supplies of ma-nure or wood- and food-processing wastes is

not likely to damage the environment and inmost cases will be environmentally beneficial.For other biomass feedstocks, however, ad-verse environmental effects of varying signifi-cance may occur due to a number of causes(see figure 8).

Serious damage may result if the supplierdoes not manage the resource properly, in-cluding selecting appropriate sites and har-vesting or renewing the biomass according toenvironmental guidelines. For example, remov-

SOURCE Office of Technology Assessment

residues — or re-ing excess amounts of cropmoving any amounts from some erosive lands— will expose soils to significantly increasederosion and subsequent damage to water qual-ity and even to land productivity if the erosionis allowed-to continue long enough. Poor log-ging practices also can cause erosion, streamdamage, and even increased flood danger inextreme cases of overcutting. Timber removalon some sites can lead to mass movements ofsoil, such as slumps or Iandslides, to reforesta-tion failures, and to damage to valuable eco-systems or recreation areas. FinalIy, transfor-mation of areas to single species managementmay cause a decline in the variety of plant andanimal species supported by the forests.

Even with accepted management practices,significant environmental damage may be un-

● esthetic changesI I

.

.

avoidable if large acreages of annual crops aregrown for alcohol production. Unless currentlyunproven strategies for crop switching andreformulating livestock feed are successful,the la rge- sca le p roduct ion o f e thano l f rom -grains and sugar crops will require placingmillions of new acres into intensive crop pro-duct ion. The land avai lable for such produc- .tion generally is more erosive and may be lessproductive than existing farmland, leading t osignificant increases in already damaging lev-els of farmland erosion as well as in the use ofagricultural chemicals.

An additional concern is the possibility ofsubtle, long-term declines in soil quality andforest productivity as a result of the shorterrotations and increased removal of biomassassociated with intensified forest manage-

Ch. 3—issues and Findings ● 41

ment. Similar concerns have been expressedabout possible long-term soil and productivitydamage associated with the collection of cropresidues, even when in compliance with SoilConservation Service erosion standards. Thecurrent state-of-knowledge does not allow de-finitive conclusions about either the extent ofany possible damage or the potential for man-

. aging it.

Finally, although intensive timber manage-ment could increase the quantity and improve

, the quality of the timber available, it also willchange the character of the forests. Removinglogging residues and increasing stand conver-sions and thinning wiII lead to more uniform,open forests with a higher proportion of even-age, single-species stands. I n addition, popula-tions of birds, animals, and insects that dependon dead and dying trees or large litter woulddecline, while other species would increase innumber. Flat, easily accessible lands probablywould undergo more extensive changes in for-est character while steep or environmentallyvulnerable lands should be less affected be-cause harvesting often is more expensive there.These changes will be objectionable to manyenvironmental groups, especially those con-cerned with preserving natural ecosystems,although other groups concerned with promot-ing hunting or increasing public access maywelcome such changes.

Although it is difficult to predict the behav-ior of biomass suppliers — and, thus, the envi-ronmental impacts associated with obtainingbiomass feedstocks– several factors wil l beimportant in influencing this behavior.

First, regulatory incentives for controlling im-pacts generally are not strong. The Environ-mental Protection Agency’s (EPA) section 208program to control nonpoint source water pol-lution has been slow in getting started, and itsfuture effectiveness is unclear. Although theForest Service appears to have good regulatorycontrol of silvicultural practices on nationalforestlands, which include some of the mostenvironmentally vulnerable wooded lands inthe United States, regulation at the State levelgenerally is hampered by insufficient agency

staff or weak laws as well as by a traditionalemphasis on forest fire prevention rather thansilvicultural management. This is particularlyt rue of pr ivate woodlands in the EasternUnited States, where 70 to 75 percent of thepotential for increased forest production ex-ists. Most of these eastern woodlands areowned privately in smalI lots, making supplierbehavior particularly difficult to predict.

Second, economic incentives for protectingthe environment are mixed. Although goodmanagement may prevent some environmen-tal damages that directly affect crop produc-tivity and growing costs, many of the benefitsof such management accrue to the public or tofuture generations rather than to the growerand harvester. For example, agricultural ero-sion is most damaging to water quality, andthe major beneficiaries of erosion preventionare the downstream users of the protectedstream. Any damage to productivity is in mostcases a very long-term effect, while financialstrains on farmers force them to value short-term gains. On the other hand, the high costsof pesticides, erosive tilling, and other main-stays of high-technology farming are leadingmany farmers to switch to practices that maybe less damaging to the environment. In forest-ry, there may be pressures to harvest vulner-able sites and to “poach” wood with environ-mentally damaging harvesting methods. Onthe other hand, foresters operating on moresuitable sites have a positive incentive for en-vironmentalIy sound management provided bythe long-term reward of good practices — amore economicalIy valuable forest.

The st rength of the incent ives for andagainst environmental protection depends onthe changing circumstances associated withthe great variety of financial conditions, cropalternatives, management plans, and physical/environmental conditions applicable to bio-mass production. In the absence of strength-ened regulations, including careful monitoringof soiI and water quality, or stronger positiveincentives for protection, some portion of afuture biomass supply may be obtained in anenvironmentalIy costly manner.

42 . Energy From Biological processes

.

.

Photo credit USDA —Soil Conservation Service

Increased incentives for environmental protection may be necessary to avoid

careless logging practices on vulnerable sites


.

What Are the Major Social Effects ofBioenergy Production?

Bioenergy production could bring a varietyof changes to society. The most important ofthese probably will be the effects on energy-related employment, on rural communities,and on quality of life. Some of these changesare more likely to be perceived as beneficialwhiIe others will be seen as detrimental,

I n most cases, biomass energy developmentwill be more labor intensive than the increaseduse of conventional fuels, such as coal, oil, ornatural gas, and therefore will result in morejobs per Quad of energy produced. These jobsare likely to occur in agriculture and forestry,in small- and medium-size businesses manufac-turing conversion equipment (e. g., digesters,gasifiers, wood stoves, stills), and in the con-struction and operation of large-scale conver-sion facilities such as electric-generating sta-tions and alcohol fuel plants.

Biomass energy resources also tend to bemore highly dispersed than conventional ener-gy sources. Feedstock transportation costs andother factors will mean that employment inharvesting, conversion, and related sectorsalso is likely to be dispersed. Thus, bioenergydevelopment will avoid the public service im-pacts and problems of secondary developmentthat can be associated with centralized devel-opment of fossil fuels in rural areas. Rather, inrural areas currently experiencing unemploy-ment and underemployment, the increased re-source management and capital investmentassociated with biomass energy are Iikely to bewelcomed. These factors should make it easierfor rural areas to plan for and achieve long-term economic growth.

In addition, biomass energy will be valuedby society for its potential to reduce consump-tion of imported foreign oil. This displacementwill be particularly valuable in agriculture,which is especially sensitive to fuel supplyinterruptions, but which could achieve a de-gree of liquid fuels or energy self-sufficiencythrough onfarm distillation and anaerobic di-

gestion, as well as increase farm incomethrough energy crop production.

Bioenergy production, however, is not with-out problems. First, the rates of reported occu-pational injuries and illnesses in agriculture,forestry, logging, and lumber and wood prod-ucts are significantly higher than the nationalaverage for all private industries. The rates perworker for logging and for lumber and woodproducts are approximately twice those forbituminous coal mining or oil and gas extrac-tion, while those for agriculture and forestryare comparable to coal, oil, and natural gas.Unless safer harvesting practices and equip-ment are developed and used, increased log-ging and agricultural production for energycould result in unacceptable levels of occupa-tional injury and increased expenditures forworkmen’s compensation. EventualIy, safetycould become an issue in labor-managementrelations as it has in the coal mines, increasingthe potential for strike-related supply interrup-tions in wood energy.

Second, the use of commodities for energycould lead to competition with traditional usesof these commodities. This competition couldincrease farmland and possibly forestlandprices, and, together with the resulting land in-flation, also could increase the price of food orresult in changes in American dietary habitssuch as less consumption of meat. If the de-mand for food continues to rise, Americans ul-timately could be forced to choose betweenrelatively inexpensive food and relatively inex-pensive fuel. Moreover, increases in U.S. foodprices are likely to increase the cost of food onthe international market. Some countries willnot be able to afford food imports, and otherswill export crops now used domestically forfood.

It should be emphasized that the potentialfor competition between bioenergy and agri-culture involves only a small fraction of thetotal biomass resource base, but that fractionis capable of causing a major confIict. How-


ever, because of uncertainties about the tim-ing and magnitude of investment in biomassconversion and about the future demand forfood, it is not known at what level of bioenergy

What Are the Problems andBioenergy Processes?

The dispersed nature of much of the bio-mass resource tends to favor its use in small-scale, dispersed applications, In some cases,facilities as large as 50-MW electric-generatingpIants may be feasible, but the full use ofresources Iike wood probably wiII require con-siderable participation by small-scale users. Inother cases, such as grain ethanol, obtainingsufficient feedstock for large-scale conversionfacilities is not a problem, but there is interestin small-scale onfarm production as a meansof achieving some degree of liquid fuels self-sufficiency for farmers and as a way for themto divert some of their grain from the marketwhen prices are low.

Some of the questions that potential small-scale users of bioenergy and biomass conver-sion facilities probably should ask are: 1 ) whatfuel do they want and will it be used onsite orsold? 2) what is the cost and reliability of theirfeedstock supply? 3) what fuel will be used forthe conversion facil ity (e. g., onfarm disti l-leries)? 4) how expensive, safe, reliable, andautomatic is the conversion facility? and 5)what are the indirect effects of using or con-verting the biomass (e. g., dependence on asingle buyer, potential crop rotation schemes,etc.)? The more important aspects of thesetechnical and economic concerns about small-scale wood energy use, onfarm alcohol pro-duction, and anaerobic digestion, as well asthe environmental and social effects of thesesystems, are considered below.

Technical and Economic Concerns ofSmall= Scale Wood Energy Systems

At present, small-scale wood energy systemsprimarily are l imited to direct combustion(wood stoves) and airblown gasification (for

production pr ices wi l l befected or when these pricecome unacceptable.

substantiallyincreases will

af -be-

Benefits of Small-Scale

small industrial boilers and process heat).Small methanol plants could be developed,but the costs are highly uncertain at present.

Where sufficient quantities of wood can beobtained for less than $60 to $1 00/cord(roughly $60 to $100/dry ton), burning thewood in efficient wood stoves or furnaces iscompetitive with home heating oil costing$0.90/gal. The actual wood cost that is com-petitive will depend on the relative efficienciesand costs of the conventional and wood heat-ing systems. However, with wood-burnin g

stoves or furnaces, it often is necessary to feedthe unit manually, and frequent ash removaland cleaning are necessary for continued safeand efficient operation. It also may be neces-sary to prepare the wood by cutting and split-ting the logs. These factors will limit the use ofwood for home heating to those people whoare willing to undertake these activities, whovalue the use of local or renewable energy sup-plies, or who use the wood as an insuranceagainst shortages of their conventional homeheating fuel.

With small-scale wood-fired industrial boil-ers, investment cost is the primary constraint.Wood-fueled boilers cost about three times asmuch as comparable oil-fired systems, and un-til lending institutions accept a wood-fueledfacility as a reasonable investment because oflower fuel costs, potential users may have dif-ficulty financing a conversion to wood energy,Also, due to uncertainties about the reliabilityof wood fuel supplies and conversion equip-ment, many potential users may wait to investin wood boilers or gasifiers until they can ob-tain long-term wood supply contracts or, in thecase of gasifiers, until more operating experi-ence has been accumulated.

*


.

If reliable, easy to use gasifiers becomewidely available, however, the number of pos-sible uses for biomass wouId increase to in-clude process heat, and the cost of retrofittingsmall industrial operations for biomass couldbe less than for direct combustion. Moreover,users could return to oil or natural gas if tem-porary wood shortages developed and theother fuels were available. This could reduceor eliminate most of the potential problemswith using wood energy in small industrialfacilities, but could pose load managementproblems for gas utilities if large numbers ofgasifiers were in operation.

Technical and Economic Concerns ofSmall-Scale Ethanol Production

Technically, it is relatively easy to produceethanol containing 5 percent or more water insmall, labor-intensive distilIeries. This alcoholcould be used as a supplement to diesel fuel inretrofitted diesel engines and it probably canbe blended with vegetable oil (such as sunflow-er seed oil) and used as a replacement fordiesel fuel, In either case, however, the ethanolp robab ly wou ld cos t a t leas t tw ice thelate-1979 cost of the diesel fuel it would re-place, In addition, if the ethanol-vegetable oilblend is used, the diesel engine probablywould deliver less power than with diesel fuelunless the engine is modified to allow morefuel to enter the combustion chamber.

With slightly more sophisticated equipmentand special chemicals, dry ethanol suitable forblending with gasoline could be produced on-farm, but the costs are likely to be consider-ably higher than for large distilleries with cur-rent technology. Process developments, par-ticularly in the ethanol drying step and in auto-matic monitoring of the distillery, could makethe costs competitive.

If ethanol from grains or sugar crops is usedas a farm or other standalone fuel, the netdisplacement of premium fuel (oil and naturalgas) is considerably less than if the ethanol isused as an octane-boosting additive to gaso-line. For some feedstocks and regions, onfarmproduction and use of ethanol actually willlead to an increase in premium fuel usage. Inessence, the farmer wouId be buying more fer-

tilizer, pesticides, and other energy-intensiveproducts in order to avoid buying diesel fuel;in some cases the net result would be that thecosts of the farming operation would continueto be very sensitive to energy prices. Forfarmers who could expand their acreage undercultivation, the tradeoff between diesel fueland other energy-intensive products would berelatively direct. For those who cannot expandtheir acreage, the choice is between the dieselfuel, plus other energy-intensive products thatcould be saved by not cultivating part of theiracreage, versus the ethanol that could be pro-duced by not selling part of their crop. De-pending on the specifics of the markets andGovernment regulations, however, the supplyof fertilizers, pesticides, and similar productsmay be less prone to temporary shortages thandiesel fuel, and this strategy might be effectiveas an insurance against diesel fuel shortages.

The least expensive distillery options assumethat the distillery byproduct stillage would befed to animals in the area without being dried.This stillage, however, can spoil within 1 to 2days and the farmer would have to changefeeding practices to avoid feed contamina-t ion .4 If there are insufficient animals in thearea or feeding wet still age proves to be im-practical for the farmer, then the sti l l agewould have to be dried, which would increasethe cost and energy requirements of the etha-nol production.

Onfarm distilleries available today requireconsiderable monitoring and other labor forsafe and reliable operation. For example, stillsinvolve risks of fire, explosion, and exposure tomoderately irritating chemicals.5 Proper train-ing and well-built equipment can reduce therisks, but the need for monitoring could makeit impractical to operate stills during planting,

‘t W Klenholz, D L Rosslter, et al , “Craln A l coho l Fermen-tation Byproducts for Feeding In Colorado, ” Department of Ani-mal Science, Colorado State University, Fort Collins

‘N Irving Sex, “Dangerous Properties of Industrial Chemi-cals, ” Van Nostrand R~lnhold Co , New York, ?11975 by LittonE d u c a t i o n a l P u b l i s h i n g , Inc The hazard categor ies are “ N o n e ,Slight causes readily reversible changes which disappear afterend ot exposure, Moderate may Involve both Irreversible and re-verjl ble c hange~ not severe enough to c a use cleat h or permanentInjury, a ncf High ma v cause cfea th or permanent Injury after veryshort exposure t o sm a I I q u a n t I t Ies ‘‘

46 ● Energy From Biological processes

harvest, and parts of the summer. However,less than full-time operation would raise theethanol costs and make it less feasible to relyon the distillery byproduct for animal feed.This points to the need for a highly automatedoperation, which will increase the cost of theequipment.

Farmers producing ethanol also will have tosecure a fuel for their distilleries. Crop residuesor grasses may be one possibility, but technol-ogies for conveniently burning or gasifyingthese fuels onfarm are not avaiIable at presentand in some regions the grasses and residuesalso are not available. Where wood is avail-able, this could be used. Alternatively, solar-powered equipment suitable for ethanol distil-lation probably can be developed, but it is notcurrently available and the costs are uncertain.Using biogas from manure digesters to fueldistilleries is technically possible, but the di-gester would add substantially to the invest-ment costs and special financing designed tolower capital charges probably would be nec-essary for most smalI operations.

In the most favorable cases, it may be possi-ble to produce wet ethanol onfarm in a labor-intensive operation for $1/gal plus labor. *Used in diesel tractors, this is about twice thelate-1979 cost (per Btu) of the diesel fuel itcould replace. There is, however, insufficientexperience with onfarm production to predictcosts accurately and this estimate may be low.

Nevertheless, the large subsidies currentlyapplied to ethanol have created a market pricefor the ethanol that is significantly higher thanthe production costs. Consequently, in somecases it may be possible to produce wet etha-nol onfarm and sell it profitably to large distil-leries for drying. If profit margins decrease,however, onfarm ethanol production with cur-rent technology would be, at best, marginal incomparison to large distilleries.

For some farmers, however, the cost or laborrequired to produce dry or wet ethanol may beof secondary importance. The value of somedegree of fuel self-sufficiency and the abilityto divert l imited quantities of crops whenprices are low may outweigh the inconveni-

‘See “Fermenta t ion” in VOI II

ence and cost. I n other words, they may con-sider onfarm ethanol production to be an in-surance against diesel fuel shortages and ameans of raising grain prices.

Technical and Economic Concerns ofSmall-Scale Anaerobic Digestion

The principal concerns regarding onfarmanaerobic digestion of animal manure to pro- .duce biogas are the investment cost of thedigester system and the need to use the biogaseffectively. The capital charges and invest-ment costs should decrease as digesters be- “come commercial. But, at Ieast in the nearterm, attractive financing arrangements wouldaccelerate commercialization.

The farmer’s ability to use the biogas energyeffectively also will play an important role indetermining the economics. Many digesterswill produce more energy than can be used onthe farm but in a form that cannot be sold easi-ly (the biogas or waste heat). Furthermore, thefarm’s energy use may have to be managed inorder to reduce daily peaks that would makethe economics of using biogas less attractive.Also, the operation may have to be expandedto include such things as greenhouses so thatall of the energy produced can be used. To theextent that the biogas is used to generate elec-tricity onfarm, the economics also will dependheavily on the prices that the electric utility iswilling to pay for wholesale electricity and thecharges for backup power.

Environmental Effects of Small- ScaleBiomass Energy Systems

The smal l -scale biomass systems, especial ly -

energy conversion systems such as woodstoves, onfarm stills, and anaerobic digesters,create both opportunities and problems for en- -vironmental control.

Smaller systems afford some opportunitiesfor using the assimilative capacity of the en-vironment for waste disposal that are imprac-tical for large centralized systems. For exam-ple, liquid wastes from small ethanol and bio-gas plants often can be safely disposed of byland application. Large plants may find this op-tion closed to them because of difficulties infinding sufficient land.

Ch. 3—issues and Findings • 47

This advantage may be overbalanced by sev-eral problems associated with small-scale op-erations. Effective “high technology” controls,such as water recycling, often are unavailableto smaller plants. Monitoring and enforcing en-vironmental standards are complicated by thelarger number of sites. Poor maintenance ofequipment and training of operators as welI asad hoc design may present potentially signifi-cant safety as welI as environmental problems.

Aside from different control options andregulatory problems, the size of biomass facil-ities affects the nature of their impacts, Effectsthat are primarily local in nature, such as dam-age from fugitive dust, toxic waste disposal,and the effects of secondary development, areless severe at any site but occur with greaterfrequency. Emissions of polycyclic organicmatter, generalIy not a problem with largecombustion sources, may be a significant prob-lem with smaller less efficient sources such aswood stoves. Finally, regional air pollutionproblems caused by the long-range transportof pollutants associated with the tall stacks oflarger plants are traded for increased localproblems caused by emissions from low stacks.This latter effect might increase State andlocal governments’ incentive to require ade-quate controls, because the major air polIutiondamages from energy conversion facilities willno longer occur hundreds or thousands ofmiIes away.

Social Considerations of Small-ScaleBioenergy Production

The social impacts of commercial-scale bio-energy production discussed above are notnecessarily applicable to small-scale systems.For example, although new jobs will be associ-ated with the manufacture, distribution, andservicing of smaIl-scale conversion equipment,obtaining the fuel for and operating the equip-ment are more Iikely to be associated with ad-ditional personal labor or a second family in-

come. Similarly, if bioenergy development fo-cuses on small-scale systems it is less l ikelythat competition with nonenergy users for re-sources would occur, because in the sectorswhere competition could be harmful, smallersystems wil l allow greater control over theamount of the resource base that is devoted toenergy.

On the other hand, some social considera-tions are more likely to arise with, or would beexacerbated by, an emphasis on small-scalesystems. For example, smaller systems pose ad-ditional health and safety problems, includingthe hazards to amateur woodcutters, the riskof house fires from improperly installed ormaintained wood stoves, and fires or explo-sions from leaks in small stills. I n addition,small stills may represent a source of alcoholthat is attractive to minors but can containpoisonous impurities such as fusel oil, acetal-dehyde, and methanol.

Small-scale systems also will be more dif-ficult to regulate than commercial-scale tech-nologies. The primary concerns here are theBureau of Alcohol, Tobacco, and Firearms per-mitting and other requirements designed toprevent unauthorized production or distribu-tion of beverage alcohol, and environmentalregulations intended to protect public healthfrom the process chemicals in disti l lery ef-fluents and from the uncontrolled combustionof solid, liquid, and gaseous fuels.

Lastly, smaller systems probably will have agreater impact on lifestyles. Even with the de-velopment of relatively automatic equipment,small-scale bioenergy conversion will requireindividual labor — personal or hired — in orderto ensure a reliable supply of energy. For somepeople, the increased price of traditional ener-gy sources may not be a sufficient incentive tooutweigh the convenience of delivered energy.This convenience factor may be the primaryconstraint on the widespread adoption ofsmall-scale systems.

48 . Energy From Biological Processes

What Are the Key RD&D Needs forBioenergy Development?

A relatively complete list of the importantRD&D needs for bioenergy development isgiven in appendix A. Certain of these, however,appear to be particularly important to thesmooth and effective development of bioener-gy as a replacement for premium fuels or as aliquid fuel that can be produced onfarm. Itshould be remembered that important devel-opments can occur in other areas, but successin those listed below are especially importantor would be particularly effective in the nearto mid-term:

●

●

Crop development.–-A variety of ener-gy crops, especialIy high-yield grasses,shou ld be deve loped. The emphas i sshould be on crops that do well on landpoorly suited to food production and thatrequire a minimum of energy inputs rela-tive to the output. Various crop-switchingpossibilities that enable fuel productionwith a minimum expansion of cropland inproduction also should be investigated.(The Federal Government supports a lim-ited amount of research in this area, but itdoes not include systematic comparativecrop evaluations that focus on energy pro-duct ion.)Forest management.— Forest managementpractices and the related equipmentshould be improved and forest landown-ers encouraged to manage their resourcein a way that is environmentally soundand that increases forest productivity.This will necessarily involve basic and ap-plied research to improve knowledge ofwhat these practices should be, and to de-termine the effects of intensive silvicul-ture on long-term forest productivity. (TheU.S. Forest Service supports research inthis area, but it generally has not inte-grated fuel production with conventionalforest products production and forestmanagement. )

●

●

●

●

Gasifiers. –A variety of inexpensive, effi-cient, and reliable gasifiers capable ofusing wood and plant herbage should bedeveloped. These would include small,airblown gasifiers for process heat andboiler retrofits, oxygen-blown and pyro-lytic gasifiers for improved methanol syn-thesis, and pretreatments such as densifi-cation of plant herbage that may be use-ful for improving the feedstock’s handlingcharacteristics. Bas ic and appl ied re-search into biomass thermochemistry andsecondary gas phase reactions would pro-vide engineers with information for im-proved gasifier design and would createnew opportunities to produce fuels andchemicals from biomass. (The Depart-ment of Energy (DOE) supports very Iittleresearch in this area. )Ethanol synthesis.– In order to provideeconomic alternatives to using grain andsugar crops for ethanol synthesis, proc-esses using wood and plant herbage tomake ethanol should be researched, de-veloped, and demonstrated. (DOE sup-ports some research in this area. )Use of methanol.– Various strategies forusing methanol in gasoline blends shouldbe developed and compared. Inexpensivetechnology that will enable engines fueledwith pure methanol to start in cold weath-er also should be developed. (DOE is sup-porting some research in the area.)Onfarm liquid fuels production.– If onfarmliquid fuel production is to be promoted,inexpensive, highly automatic, small-scaleethanol stills should be developed, includ-ing options for producing dry ethanol anddry distillers’ grain, and for using a varietyof solid fuels commonly found onfarm.Other onfarm liquid fuels options such assmall sunflower seed presses also shouldbe investigated and, where appropriate,developed. (DOE and USDA are support-ing some research in this area. )

.

.

*


.

.

What Are the Principal Policy Considerations forBioenergy Development?

The issues discussed above point out thepotential benefits and problems of increasedre l iance on b iomass energy sources in theUnited States. Bioenergy is both renewableand domestic and wouId therefore help reduceU.S. dependence on costly and insecure im-ported oil and on depleting fossil fuels. How-ever, bioenergy also may have important, butdifficult to predict, effects on the environmentand on prices for food, feed, fiber, and land.The primary policy considerations that areraised by the potential problems and benefitsof bioenergy development are reviewed below.

First, a number of measures have been pro-posed or passed by Congress to promote newenergy sources of all kinds, and many of thesewilI improve the prospects for investment inbioenergy. However, because of the widerange of biomass feedstocks and conversiontechnologies, many bioenergy systems wouldbenefit more from policies carefully tailoredto these feedstocks and technologies. Thesecould include programs to provide informa-tion and technical assistance to bioenergyusers and to develop reliable supply infrastruc-tures for energy uses of biomass resources.

Second, because of uncertainties about thesources of bioenergy feedstock supplies, theintroduction of biomass energy should bemonitored carefully. For example, if commodi-ty prices rise i n response to bioenergy develop-ment, Congress might choose to reevaluatepromotional policies and adjust them if neces-sary, For this reevaluation, legislators could

. use measures such as “sunset” provisions andprice and quantity thresholds for subsidies, aswelI as statutory requirements for the reviewof existing policies. In addition, rapid develop-ment, demonstration, and commercializationof economic processes for producing ethanol

and methanol from Iignocellulosic materialswould reduce the energy demand for grainsand sugar crops.

Uncertainties about future biomass resourceharvesting and management practices make itimportant to monitor the environmental im-pacts of bioenergy development as well. Forexample, with proper management the quanti-ty and quality of timber avaiIable for wood en-ergy and for traditional wood products couldincrease, Without such management, however,harvesting fuelwood could cause severe waterpollution as well as declining land productivi-ty. Other bioenergy sources threaten environ-mental problems of simiIar importance. Conse-quently, the environmental effects of obtain-ing all major biomass resources should bemonitored, and new and expanded programsand incentives should be used to encouragesound resource management practices.

I n addition, using biomass for energy and forchemical feedstocks will link economic sectorsthat previously were independent of eachother. These links could have significant insti-tutional implications for regulation, such asthat related to antitrust.

Finally, concerns have been raised about themagnitude and duration of bioenergy subsi-dies. Gasohol, for example, already receivesFederal and State subsidies in the form of taxexemptions that can total as much as $56/bblof ethanol. * Such subsidies, especially if theyare continued for long periods of time, distortconsumer perceptions of the true cost of bio-energy.

‘See “Alcohol Fuels” In ch 5

Documents

Chapter 3 ISSUES AND FINDINGS - Princeton