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NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE NEW ENERGY BRIGHT FUTURE
RENEWABLE ENERGY FOR CHINARENEWABLE ENERGY FOR CHINARENEWABLE ENERGY FOR CHINARENEWABLE ENERGY FOR CHINA’’’’S SUSTAINABLE DEVELOPMENTS SUSTAINABLE DEVELOPMENTS SUSTAINABLE DEVELOPMENTS SUSTAINABLE DEVELOPMENT
Shi Yunqi, Yuan Tinghua, Lu JingwenShi Yunqi, Yuan Tinghua, Lu JingwenShi Yunqi, Yuan Tinghua, Lu JingwenShi Yunqi, Yuan Tinghua, Lu JingwenShanghai Jiaotong UniversityShanghai Jiaotong UniversityShanghai Jiaotong UniversityShanghai Jiaotong University
CONTENTCONTENTCONTENTCONTENT
WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?Pressure in traditional energyPressure in traditional energyPressure in traditional energyPressure in traditional energy
Disadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energy
Introduction of several new energyIntroduction of several new energyIntroduction of several new energyIntroduction of several new energy
WHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
AAAA
BBBBNew energy industryNew energy industryNew energy industryNew energy industry
Situation and marketing analysisSituation and marketing analysisSituation and marketing analysisSituation and marketing analysis1. Wind and solar energy2. Life period analysis and why bio-energy
General idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energy
Policy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in China
SWOT analysisSWOT analysisSWOT analysisSWOT analysis
CCCC BIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSAL
Overview & problemOverview & problemOverview & problemOverview & problem
Solution & strategiesSolution & strategiesSolution & strategiesSolution & strategies1. No foodstuff material2. Technology innovation
What can SK do?What can SK do?What can SK do?What can SK do?
BIO-DIESELBIO-DIESELBIO-DIESELBIO-DIESEL
BIO-ETHANOLBIO-ETHANOLBIO-ETHANOLBIO-ETHANOL
OverviewOverviewOverviewOverview
Raw materialsRaw materialsRaw materialsRaw materials
Business opportunityBusiness opportunityBusiness opportunityBusiness opportunity
ApplicationApplicationApplicationApplication
CONTENTCONTENTCONTENTCONTENT
WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?Pressure in traditional energyPressure in traditional energyPressure in traditional energyPressure in traditional energy
Disadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energy
Introduction of several new energyIntroduction of several new energyIntroduction of several new energyIntroduction of several new energy
WHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
AAAA
BBBBNew energy industryNew energy industryNew energy industryNew energy industry
Situation and marketing analysisSituation and marketing analysisSituation and marketing analysisSituation and marketing analysis1. Wind and solar energy2. Life period analysis and why bio-energy
General idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energy
Policy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in China
SWOT analysisSWOT analysisSWOT analysisSWOT analysis
CCCC BIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSAL
Overview & problemOverview & problemOverview & problemOverview & problem
Solution & strategiesSolution & strategiesSolution & strategiesSolution & strategies1. No foodstuff material2. Technology innovation
What can SK do?What can SK do?What can SK do?What can SK do?
BIO-DIESELBIO-DIESELBIO-DIESELBIO-DIESEL
BIO-ETHANOLBIO-ETHANOLBIO-ETHANOLBIO-ETHANOL
OverviewOverviewOverviewOverview
Raw materialsRaw materialsRaw materialsRaw materials
Business opportunityBusiness opportunityBusiness opportunityBusiness opportunity
ApplicationApplicationApplicationApplication
The demand of coal becomes The demand of coal becomes The demand of coal becomes The demand of coal becomes slow gradually.slow gradually.slow gradually.slow gradually.
(106t)
(106m3)(106t)
The demand of petroleum The demand of petroleum The demand of petroleum The demand of petroleum increases sharply.increases sharply.increases sharply.increases sharply.
The natural gas industry is The natural gas industry is The natural gas industry is The natural gas industry is undeveloped and still needs undeveloped and still needs undeveloped and still needs undeveloped and still needs to be matured.to be matured.to be matured.to be matured.
ChinaChinaChinaChina’’’’s demand of traditional energy in 10 yearss demand of traditional energy in 10 yearss demand of traditional energy in 10 yearss demand of traditional energy in 10 years
1.1 HIGH DEMAND OF TRADITIONAL ENERGY IN CHINA
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
In 2008,China accounted for In 2008,China accounted for In 2008,China accounted for In 2008,China accounted for 4.22% of world4.22% of world4.22% of world4.22% of world’’’’s economy s economy s economy s economy while consumed 7.4% of while consumed 7.4% of while consumed 7.4% of while consumed 7.4% of worldworldworldworld’’’’s oil. Meanwhile the s oil. Meanwhile the s oil. Meanwhile the s oil. Meanwhile the dependence on imported oil dependence on imported oil dependence on imported oil dependence on imported oil reached 55%, to 200 million reached 55%, to 200 million reached 55%, to 200 million reached 55%, to 200 million ton, having a net increase of 80 ton, having a net increase of 80 ton, having a net increase of 80 ton, having a net increase of 80 million than 2007. China paid million than 2007. China paid million than 2007. China paid million than 2007. China paid much more 50 billion US much more 50 billion US much more 50 billion US much more 50 billion US dollars for it!dollars for it!dollars for it!dollars for it!
1.2 DISADVANTAGES OF TRADITIONAL ENERGY
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
ENVIRONMENT ENVIRONMENT ENVIRONMENT ENVIRONMENT POLLUTIONPOLLUTIONPOLLUTIONPOLLUTION
NON-RENEWABLENON-RENEWABLENON-RENEWABLENON-RENEWABLEENERGYENERGYENERGYENERGY
Source: PRCSource: PRCSource: PRCSource: PRC’’’’s National Bureau of Statistics s National Bureau of Statistics s National Bureau of Statistics s National Bureau of Statistics
Solar photovoltaic, solar thermal power, solar water heaters and solar house
Including off-grid small wind turbines running and large scale wind turbine.
Converted to high-quality energy, including electricity, gas, liquid fuel and solid fuels such as forming
Including power generation and heat use two ways
Tidal power, wave power and ocean current power generation
So!So!So!So!So!So!So!So!
1.3 INTRODUCTION OF SEVERAL NEW ENERGY
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
CONTENTCONTENTCONTENTCONTENT
WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?Pressure in traditional energyPressure in traditional energyPressure in traditional energyPressure in traditional energy
Disadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energy
Introduction of several new energyIntroduction of several new energyIntroduction of several new energyIntroduction of several new energy
WHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
AAAA
BBBBNew energy industryNew energy industryNew energy industryNew energy industry
Situation and marketing analysisSituation and marketing analysisSituation and marketing analysisSituation and marketing analysis1. Wind and solar energy2. Life period analysis and why bio-energy
General idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energy
Policy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in China
SWOT analysisSWOT analysisSWOT analysisSWOT analysis
CCCC BIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSAL
Overview & problemOverview & problemOverview & problemOverview & problem
Solution & strategiesSolution & strategiesSolution & strategiesSolution & strategies1. No foodstuff material2. Technology innovation
What can SK do?What can SK do?What can SK do?What can SK do?
BIO-DIESELBIO-DIESELBIO-DIESELBIO-DIESEL
BIO-ETHANOLBIO-ETHANOLBIO-ETHANOLBIO-ETHANOL
OverviewOverviewOverviewOverview
Raw materialsRaw materialsRaw materialsRaw materials
Business opportunityBusiness opportunityBusiness opportunityBusiness opportunity
ApplicationApplicationApplicationApplication
the Proportion of New Energy Generation the Proportion of New Energy Generation the Proportion of New Energy Generation the Proportion of New Energy Generation Capacity In the Total Number(China) Capacity In the Total Number(China) Capacity In the Total Number(China) Capacity In the Total Number(China)
Solar, Wind And Hydroelectric Solar, Wind And Hydroelectric Solar, Wind And Hydroelectric Solar, Wind And Hydroelectric Generated Energy(China) Generated Energy(China) Generated Energy(China) Generated Energy(China)
New Energy Power Generation Installed New Energy Power Generation Installed New Energy Power Generation Installed New Energy Power Generation Installed Capacity And Increase Rate(Global) Capacity And Increase Rate(Global) Capacity And Increase Rate(Global) Capacity And Increase Rate(Global)
At of the end of 2009, China's total installed hydropower capacity reached 197 million kilowatts.
China has the largest developing scale of new energy, if the large hydropower capacity is included.
While besides the hydropower, the amount of other new energy is quite small. In 2006, it was about 1.4%. In 2007, it grew up to 2%. And in 2008, it still didn't reach 3%.
As a whole, with the support of the government, China have been making great effort to the development of the new energy industry. And the new energy industry is becoming a new prosperous industry.
It is estimated that China has a large hilly area that is suitable for the growth of pistaciachinensis(an ideal material to make biofuels, which can meet the need of about 5 million biodiesel per year.
In recent years, for the influence of the rising petroleum cost and the global warming, global society has paid great attention to the development of new energy. Also with the support of policy, new energy industry enjoys a good growing environment.
Source: Global Energy NetworkSource: Global Energy NetworkSource: Global Energy NetworkSource: Global Energy Network
2.1 NEW ENERGY POWER IN HOME & ABROAD
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
GENERAL SITUATION EQUIPMENT SUPPLIER
GENERAL SITUATION
SOLARSOLARSOLARSOLARSOLARSOLARSOLARSOLAR
WINDWINDWINDWINDWINDWINDWINDWIND EQUIPMENT SUPPLIER
The global wind power market expands greatly, the overall installed capacity has increased from 4800 MW in 1995 to 74223 MW in 2006, and it will be keep this good momentum in the feature.
In 2008, China had a newly increase wind power capacity about 12170 MW, and China has became the world 4th biggest market.
China has the world's largest industry scale both in installed capacity and manufacturing.
In 2008, global overall solar installed capacity had reached 15000 MW.
Till now, wind power development has become the hottest investment field.
With the background of the scarce fossil energy, all countries make great efforts to the solar energy industry, especially those developed countries, their early start makes them be the leaders in this field
At present, the industry of high tech crystalline silicon material, which is widely used in photovoltaic power generation field, has been monopolized by Japan, America and Germany.
The market of global solar battery is still managed by the minority of the manufactories like Sharp and Kyocera.
we can see that the solar power industries is a partly monopolized market.
Though China has the world's 4th biggest wind power market, it is still hard to enter its equipment field.
In China, the new wind power market will be divided by 3 business giants named Huarui Wind Power, Jinfeng Tech and Orient Electric.
Besides, the capacity of these 3 giant is keeping expanding. What's more, Vestas, a foreign manufactory also intended to extend their capacity.
2.2.1 SITUATION & MARKETING ANALYSIS
Source: Global Energy NetworkSource: Global Energy NetworkSource: Global Energy NetworkSource: Global Energy Network
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
Early Early Early Early PeriodPeriodPeriodPeriod
Growing up Growing up Growing up Growing up PeriodPeriodPeriodPeriod
Maturing Maturing Maturing Maturing PeriodPeriodPeriodPeriod
Recession Recession Recession Recession PeriodPeriodPeriodPeriod
DemandDemandDemandDemand Small Fast increasing
Slow or stop increasing
Decreasing
CompetitorCompetitorCompetitorCompetitor Few More Many Number decreasing
CustomerCustomerCustomerCustomer Innovative
The masses The masses Lingering consumers
Cash FlowCash FlowCash FlowCash Flow Minus Moderate High Low
Profit StateProfit StateProfit StateProfit State High risk & low income
High risk & high income
Low risk & low income
High risk & low income
Main characters of a industryMain characters of a industryMain characters of a industryMain characters of a industry’’’’s life periods life periods life periods life period In this period, with the technology styling, the In this period, with the technology styling, the In this period, with the technology styling, the In this period, with the technology styling, the market growing rate is quite high, and the demand market growing rate is quite high, and the demand market growing rate is quite high, and the demand market growing rate is quite high, and the demand from customers is also growing fast. from customers is also growing fast. from customers is also growing fast. from customers is also growing fast.
Industry feature, competition situation and the Industry feature, competition situation and the Industry feature, competition situation and the Industry feature, competition situation and the customer feature are quite clear.customer feature are quite clear.customer feature are quite clear.customer feature are quite clear.
This period is quite an opportunity for investment This period is quite an opportunity for investment This period is quite an opportunity for investment This period is quite an opportunity for investment and development.and development.and development.and development.
The life period analysis of ChinaThe life period analysis of ChinaThe life period analysis of ChinaThe life period analysis of China’’’’s new energy industrys new energy industrys new energy industrys new energy industry
As what we can see in the analysis picture, biofuel As what we can see in the analysis picture, biofuel As what we can see in the analysis picture, biofuel As what we can see in the analysis picture, biofuel is listed in the growing period.is listed in the growing period.is listed in the growing period.is listed in the growing period.
According to the table above , in this period, we According to the table above , in this period, we According to the table above , in this period, we According to the table above , in this period, we can enjoy a great number of advantages.can enjoy a great number of advantages.can enjoy a great number of advantages.can enjoy a great number of advantages.
The high demand from the market, the increasing The high demand from the market, the increasing The high demand from the market, the increasing The high demand from the market, the increasing number of customer, the reasonable and number of customer, the reasonable and number of customer, the reasonable and number of customer, the reasonable and moderate cash flow, and the most important is a moderate cash flow, and the most important is a moderate cash flow, and the most important is a moderate cash flow, and the most important is a high risk and high income profit state.high risk and high income profit state.high risk and high income profit state.high risk and high income profit state.
BIO-ENERGYBIO-ENERGYBIO-ENERGYBIO-ENERGY IS A GOOD IS A GOOD IS A GOOD IS A GOOD CHOICE FOR CHOICE FOR CHOICE FOR CHOICE FOR DEVELOPMENT AND DEVELOPMENT AND DEVELOPMENT AND DEVELOPMENT AND INVESTMENT IN CHINAINVESTMENT IN CHINAINVESTMENT IN CHINAINVESTMENT IN CHINA
Source: China New Energy NetworkSource: China New Energy NetworkSource: China New Energy NetworkSource: China New Energy Network
2.2.2LIFE PERIOD ANALYSIS & WHY BIO-ENERGY
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
Environment-Environment-Environment-Environment-FriendlyFriendlyFriendlyFriendly
Renewable and waste Renewable and waste Renewable and waste Renewable and waste utilizationutilizationutilizationutilization
Wide-ranging sourcesWide-ranging sourcesWide-ranging sourcesWide-ranging sources
INDUSTRIAL UTILIZATIONINDUSTRIAL UTILIZATIONINDUSTRIAL UTILIZATIONINDUSTRIAL UTILIZATION21
3 ADVANTAGESADVANTAGESADVANTAGESADVANTAGES
GENERAL SITUATIONGENERAL SITUATIONGENERAL SITUATIONGENERAL SITUATION
China theoretical reserves of biomass China theoretical reserves of biomass China theoretical reserves of biomass China theoretical reserves of biomass resources 50 million tons. resources 50 million tons. resources 50 million tons. resources 50 million tons.
2008 China's ethanol production was 1.46 2008 China's ethanol production was 1.46 2008 China's ethanol production was 1.46 2008 China's ethanol production was 1.46 million tons, rank the third in the worldmillion tons, rank the third in the worldmillion tons, rank the third in the worldmillion tons, rank the third in the world
Crop straw produced each year around Crop straw produced each year around Crop straw produced each year around Crop straw produced each year around 600 million tons, about 300 million tons 600 million tons, about 300 million tons 600 million tons, about 300 million tons 600 million tons, about 300 million tons can be used as energy use, equivalent to can be used as energy use, equivalent to can be used as energy use, equivalent to can be used as energy use, equivalent to 150 million tons of standard coal150 million tons of standard coal150 million tons of standard coal150 million tons of standard coal
2.3 GENERAL IDEA ABOUT BIO-ENERGY
Source: Global Energy NetworkSource: Global Energy NetworkSource: Global Energy NetworkSource: Global Energy Network
Crop straw stalk, livestock manure, sugarcane, sweet sorghum, cassava, sweet potato, paddy hull, corn cob, bagasse are all sources of bio-energy.
Bio-energy is different from traditional energy, it can be renewable because it is made from corn. And those corn waste will be no more waste but useful if the bio-energy industry developed.
Bio-energy is easy to burn and the emission of SO 2 and nitrogen oxide is much lower than traditional energy.
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
Encourage and support the rural use of biomass for power construction in rural areas, increasing rural electricity supply
According to scientific planning and the principles of orderly development of land planted to encourage the use of non-energy plants, firewood and other energy forest to develop.
Encourage the production and use of biological liquid fuel. Oil Marketing Companies in the energy department under the State Council or provincial government requirements, should meet the national standard of biological liquid fuel into the fuel distribution system.
2006.9.30Four financial subsidiesFour financial subsidiesFour financial subsidiesFour financial subsidies
2.4 NATIONAL POLICY SUPPORT IN BIO-ENERGY
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
StrengthensStrengthensStrengthensStrengthens√√√√ The production of bio-energy contributes to secure energy supply. √√√√ Due to a longer value chain within the national boundaries, bio-energy industry creates new employment. √√√√ Feedstock production for energy purposes creates jobs especially in China’s rural areas, thus strengthening China’s rural economy.
WeaknessWeaknessWeaknessWeakness√√√√ Feedstock production for biofuels is land consuming. √√√√ Fuel prices largely depend on the sale of co-products. √√√√ Feedstock production largely depends on many vagaries of nature, including extreme weather conditions and pest attacks.
OpportunityOpportunityOpportunityOpportunity√√√√ Bio-energy has the opportunity to replace a large percentage of traditional energies. √√√√ Biofuels have the opportunity to decrease dependency on crude oil. √√√√ New and more efficient conversion technologies will be found and existing technologies will be improved.
ThreatThreatThreatThreat√√√√ The bio-energy market is a relatively new market. √√√√ Biofuel production is limited due to land availability for feedstock production. √√√√ Feedstock production of biofuels is in competition with food production.
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
2.5 SWOT ANALYSIS
CONTENTCONTENTCONTENTCONTENT
WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?WHY NEW ENERGY?Pressure in traditional energyPressure in traditional energyPressure in traditional energyPressure in traditional energy
Disadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energyDisadvantage of traditional energy
Introduction of several new energyIntroduction of several new energyIntroduction of several new energyIntroduction of several new energy
WHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
AAAA
BBBBNew energy industryNew energy industryNew energy industryNew energy industry
Situation and marketing analysisSituation and marketing analysisSituation and marketing analysisSituation and marketing analysis1. Wind and solar energy2. Life period analysis and why bio-energy
General idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energyGeneral idea about bio-energy
Policy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in ChinaPolicy support in bio-energy in China
SWOT analysisSWOT analysisSWOT analysisSWOT analysis
CCCC BIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSALBIO-ENERGY ANALYSIS & PROPOSAL
Overview & problemOverview & problemOverview & problemOverview & problem
Solution & strategiesSolution & strategiesSolution & strategiesSolution & strategies1. No foodstuff material2. Technology innovation
What can SK do?What can SK do?What can SK do?What can SK do?
BIO-DIESELBIO-DIESELBIO-DIESELBIO-DIESEL
BIO-ETHANOLBIO-ETHANOLBIO-ETHANOLBIO-ETHANOL
OverviewOverviewOverviewOverview
Raw materialsRaw materialsRaw materialsRaw materials
Business opportunityBusiness opportunityBusiness opportunityBusiness opportunity
ApplicationApplicationApplicationApplication
3.1.1 Bio-diesel Industry Overview and Problem
Up to the end of 2007, ChinaUp to the end of 2007, ChinaUp to the end of 2007, ChinaUp to the end of 2007, China’’’’s bio-diesel industry has a more s bio-diesel industry has a more s bio-diesel industry has a more s bio-diesel industry has a more than three million tons annual capacity.than three million tons annual capacity.than three million tons annual capacity.than three million tons annual capacity.
Capacity No. of Companies
More than 10,000 ton 26
Less than 50,000 ton 13
From 50,000 ton to 100,000 ton 7
Over 100,000 ton 6
•At present, private enterprises, large state-owned enterprises, foreign enterprises participate the bio-diesel market. •Private enterprises are the main force , while large state-owned enterprises and foreign enterprises are started late.
From the table, it seems that China's bio-diesel industry has formed a certain scale. However, due to raw material shortages and other reasons, bio-diesel production was only about 300 thousand tons, capacity utilization was only 10%.
The Key to the Problem is Raw Material!Raw Material!Raw Material!Raw Material!
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
3.1.2a Solutions & Strategies for Bio-diesel Industry
For the long run, Chinese pistache and physic nut can be the best raw material for making bio-diesel.
Globe
rapeseed oil, soybean oil, palm oil and other raw materials for bio-diesel
China
Due to China’s national conditions, in the short term, it will continue to use wasted oil as a main material
The comparison of different raw materials (Yuan/ton)
Raw Raw Raw Raw MaterialsMaterialsMaterialsMaterials
PricePricePricePrice Product CostProduct CostProduct CostProduct Cost Biodiesel Biodiesel Biodiesel Biodiesel PricePricePricePrice
Net ProfitNet ProfitNet ProfitNet Profit
Rapeseed oil 10000 10800 7000 −3800
Soybean oil 9000 9800 7000 −2800
Animal oil 8000 8800 7000 −1800
Palm oil 7500 8300 7000 −1300
Physic nut 6000 6800 7000 200
Hogwash oil 5400 6600 7000 400
Vegetable oil foots
3500 6400 7000 600
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
3.1.2b Solutions & Strategies for Bio-diesel Industry —— Technology Innovation
At present, chemical transesterification is mainly used to produce bio-diesel in China, a few companies use enzymatic. But with enzyme technology being mastered by more enterprises, it will be used much more often. And with the mature of engineering of microalgae method, its future may also become an important bio-diesel production technology trends.
�Improving the conversion rate is important to bio-diesel market. The key is the technology
�Ministry of Science and Technology has listed bio-diesel into the “Eleventh Five-Year” National 863 Program and the the the the international scientific and international scientific and international scientific and international scientific and technological cooperation technological cooperation technological cooperation technological cooperation
WHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGYWHY NEW ENERGY PROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALPROPOSALWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGYWHY BIO-ENERGY
3.1.3 SK can improve China3.1.3 SK can improve China3.1.3 SK can improve China3.1.3 SK can improve China’’’’s biodiesel s biodiesel s biodiesel s biodiesel Industry Industry Industry Industry
SK’s History in Biodiesel
In 2005 SK Chemicals is separated from SK group’s petrochemical sector, specializing in oil-based industry
In 2007, Korea Industry Ministry approved SK Chemicals as a "bio-diesel production enterprise”.
SK’s Advantages
SK Chemicals has the advanced technology and low cost in producing biodiesel.
SK has an annual capacity of producing more than 100,000 tons biodiesel in Korea.
SK’s Successful Case in Korea
SK Chemicals Ulsan plant won bronze because of its energy saving achievements in the industry.
By adjusting the system to lower carbon emissions, and to recycle resources, Ulsan plant has become an environment-friendly plant.
SK’s strategy & advantages
Success in Success in Success in Success in ChinaChinaChinaChina
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3.2.1 Overview of Bio-ethanol
Globe
•1930’s
USA started bio-ethanol research
•1970’s
World oil crisisUSA introduced ‘Bio-ethanol Development Plan’
Brazil started its bio-ethanol research
•2008
Production RankingUSA 5.8 billion 1Brazil 4.8 billion 2 (gallon)
China
•2001
China’s Central Government invested 5 billion in Heilongjiang, Jilin, Anhui and Hunan Province to develop bioethanol
•2005
China’s Central Government launched ‘Renewable Energy Law’ to promote the rapid development on bioethanol
•1990
U.S. Congress passed the Clean Air Act amendments
•2008
Production Ranking440 million gallon 3
ChinaChinaChinaChina’’’’s Central Government also implemented incentives as follows:s Central Government also implemented incentives as follows:s Central Government also implemented incentives as follows:s Central Government also implemented incentives as follows:�Remove the ethanol gasoline (containing 10% bio-ethanol) consumption tax of 5%
�Remove all bio-energy production and manufacturing enterprises income tax (17%)
�Direct subsidies are given to bio-ethanol, e.g. subsidies of 1,370 yuan/ton in 2007
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3.2.2 Raw Materials
Raw Materials Demand and Net output Raw Materials Demand and Net output Raw Materials Demand and Net output Raw Materials Demand and Net output Material Production Per Unit
area (ton/hectare)Raw materials for
Ton Ethanol (ton/ton)
Ethanol production per unit area (ton/hectare)
The efficiency of input and output
CORN 5.29 2.82 1.87 1 : 1.30
SUGARCANE 63.97 13.31 4.81 1 : 9.0
CASSAVE 19.5 7.5 2.87 1 : 1.35
Raw Materials used in major bioethanol countriesRaw Materials used in major bioethanol countriesRaw Materials used in major bioethanol countriesRaw Materials used in major bioethanol countries
USA CORN BRAZIL SUGARCANE
EU WHEAT, SUGARBEET
CHINA CORN, WHEAT, CASSAVACANADA CORN,
WHEATTHAILAND SUGARCANE,
CASSAVA
Corn and Wheat are widely used to produce ecoethanol, which may be the hidden crisis !
Source: Ministry of Agriculture
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3.2.3 Turning Point and Business Opportunity
World Bioethanol growth trend
Million gallon
The average price of three food (Wheat, Corn and Paddy)
Yuan/50 kilogram
We can easily find with the growth of bioethanol, the food price also rose quickly.
In 2007, National Development and Reform Commission issued "the promotion of processing on the healthy development of corn", forbidding new ethanol project used corn as raw material, and strongly encouraged the development of non-grain crops as raw materials .
Opportunities for SKOpportunities for SKOpportunities for SKOpportunities for SK
�SK can invest on the "non-SK can invest on the "non-SK can invest on the "non-SK can invest on the "non-food" breeding and do research food" breeding and do research food" breeding and do research food" breeding and do research on key technology of new on key technology of new on key technology of new on key technology of new materialsmaterialsmaterialsmaterials
�Enhance the research and development of second generation of bio-ethanol technology.
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3.2.4 Application & Development Trend
Short TermShort TermShort TermShort Term
Short term market is the vehicle fuel, especially ethanol gasoline .Short term market is the vehicle fuel, especially ethanol gasoline .Short term market is the vehicle fuel, especially ethanol gasoline .Short term market is the vehicle fuel, especially ethanol gasoline .
Middle TermMiddle TermMiddle TermMiddle Term
It has a very broad application in the low-temperature fuel cell, cell phones, laptop computers and next-generation fuel cell, automotive and other mobile power sources.
Long TermLong TermLong TermLong Term
In the next 20 years, as oil becomes even less, while cellulosic ethanol can be largely produced, it becomes more competitive to enter the field of petrochemical basic raw materials.
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Wherever in China or in the whole world,Wherever in China or in the whole world,Wherever in China or in the whole world,Wherever in China or in the whole world,
And And And And BIO-ENERGYBIO-ENERGYBIO-ENERGYBIO-ENERGY will be the key to sustainable development in the future ! will be the key to sustainable development in the future ! will be the key to sustainable development in the future ! will be the key to sustainable development in the future !
itititit’’’’s a must that new energy should take the place of traditional ones.s a must that new energy should take the place of traditional ones.s a must that new energy should take the place of traditional ones.s a must that new energy should take the place of traditional ones.
Shi Yunqi [email protected] Tinghua [email protected] Jingwen [email protected]
THANK YOU !THANK YOU !THANK YOU !THANK YOU !