Photo: Rita Newman
Biofuels Today – Facts and Figures
More than 30% of the energy consumption in the European Union is attributable to the transport sector, which is still growing. Unless countermeasures are taken, this will lead to increasing CO2 emissions with the well-known adverse effects on the environment and climate.
The most important and up-to-date facts and figures on biofuels are summarised in this article.The European Union has issued a Directive for the promotion of biofuels or other renewable fuels as a substitute for petrol and diesel fuels.
The EU’s objectives
As part of its climate strategy, the EU stipulates
- a share of 2% biofuels since 2005
- a share of 5.75% as from 2010
- a share of 10% renewable sources of energy (biofuels and green electricity) in the transport sector by
the year 2020
Austria’s objectives
- since 1 October 2005 2.5 % of all petrol and diesel fuels placed on the market to be replaced by biofuels,
- since 2007 4.3 %, and
- since 1 October 2008 5.75%.
By the year 2020 Austria, pursuant to the requirements of the EU, must reach a share of 10% of renewable energy sources (biofuels and green electricity for electric vehicles) in the entire transport sector.
The advantages of biofuels
Biofuels have a number of advantages over fossil fuels:
- CO2 emissions are reduced.
- Biofuels “grow back”. Petroleum will run out some day.
- Biofuels lower our dependency on imported oil.
- Promoting renewable energy sources could create 20,000 jobs in rural areas by 2012.
- Less soy-bean feed imports are required, since high-protein animal feed is generated as a by-product of
bioethanol and biodiesel production in Austria.
How high are the CO2 emissions of fuels?
The CO2 emissions that result from the combustion of biofuels are designated as biogenous CO2 and viewed as climate-neutral, since their combustion, unlike that of fossil fuels, releases only as much carbon dioxide as the plants absorbed from the atmosphere during their growth.
Naturally, biofuels are not completely climate-neutral, since fossil greenhouse gas emissions result from the cultivation of the plants (e.g., use of machines, nitrous oxide emissions from fertilisation), from the manufacture of the biofuels (e.g. electrical consumption by the production facilities), and from the transport of the biofuels (e.g., fuel consumption during delivery to filling stations).
The most environmentally friendly biofuel
The lifecycle assessment method can be used to calculate the total greenhouse emissions from all phases of the product lifecycle, i.e., from biomass cultivation on to fuel production and combustion. Depending on the figures that are selected, it can be used to calculate both the “best case” and the “worst case” results. (The results of the lifecycle assessment carried out by the Federal Environment Agency (UBA) were generated based on the GEMIS programme and the Handbook for Emission Factors in Austria).
In both cases, fossil fuels were responsible for the highest CO2 emissions over the entire product lifecycle. In general, biofuels, with very few exceptions, always have a more positive CO2 balance sheet than fossil fuels do.
In the best case, for instance, emissions are reduced by 70% by using biodiesel instead of fossil diesel; in the worst case, the reduction is still 13%. In the best case, in which liquid manure is used as a substrate for biogas production and under the assumption that there will be no waste from the escape of gases, a passenger car that is run on biogas fuel demonstrates the lowest greenhouse gas emissions.
Use of biofuel additives already showing success
Austria’s Climate Balance Sheet for 2007 already shows a reduction of about one million tonnes of CO2 thanks to the use of biofuels. Due to the obligatory use of 5.75% biofuels since October 2008 these annual savings see an increase by another 400,000 tonnes.
Tax incentives for using biofuels
In parallel with the obligatory substitution, tax incentives are provided for fuels that are sulphur-free and contain biofuel additives, through differentiation of the Austrian petroleum tax rates (“Mineralölsteuer” - MöSt). Biofuels in their pure form are exempt from the petroleum tax, and the bioethanol content in E85-fuel is likewise exempt from the petroleum tax. The split petroleum tax rates have been applied to diesel since 1 October 2005 and to petrol since 1 October 2007. This differential taxation system was adopted unanimously by the Austrian National Assembly.
What kinds of biofuels are there?
The term “biofuels” includes bioethanol, fatty acid methyl ester (FAME, biodiesel), biogas, plant oil, as well as synthetic biofuels. In terms of volume, biodiesel and bioethanol are currently the most significant.
Second-generation biofuels
In addition, there are a number of other products that cannot yet be produced in large quantities or that are still under development, such as the so-called “second-generation biofuels”.
They are to be extracted from the cellulose content of plants (grass, straw, or wood). It will take at least 5 to 10 years, however, for this technology to go beyond demonstration prototypes and prove suitable for mass-production.
Biodiesel
Biodiesel has a considerable market share in Austria, in particular as an additive product. Biodiesel is obtained mainly by pressing oil seeds (in Europe, rape seed, in particular). The extracted oil is then purified and esterified into biodiesel by adding about 10% methanol and a catalyst. Biodiesel can also be generated from palm oil; in term of quantity, however, this is of minor importance in Europe.
Since October 2005 around 95% of the diesel fuel contains a share of about 4.7% of biodiesel at all Austrian filling stations. Since February 2009 the petroleum industry has started raising the admixture of biodiesel from a maximum of 5% (B5) to a maximum of 7% (B7). This increase is based on a national fuel standard which constitutes an anticipation of the amendment to the European diesel standard.
For the use of higher percentages of biodiesel or 100% biodiesel, approval by the vehicle manufacturer is required. In certain cases, such as lubricity and combustibility, biodiesel is even superior to fossil diesel.
Utilisation and production in Austria
In 2007, 370,046 tonnes of biodiesel were used in Austria: approximately 300,000 tonnes through admixture to fossil fuels and approximately 71 tonnes in pure form or in the form of a mixture containing over 5% of biodiesel.
In addition, for example for agricultural uses, 18,000 tonnes of pure plant oil were placed on the market as fuel.
This means that in the fourth quarter of 2007, totally 4.85% (in terms of energy content) of the fuels sold in Austria were replaced by biofuels.
According to ARGE Biokraft, the Austrian biofuel producers’ association, 241,381 tonnes of biodiesel were produced in Austria in 2007. 80,000 tonnes of that total were exported, 102,531 tonnes were mixed with fossil diesel, and 59,000 tonnes were brought to market in diesel containing a biofuel component of more than 5% by volume.
Bioethanol
In Austria, bioethanol has been added to petrol since 1 October 2007. Bioethanol is high-quality alcohol obtained from raw materials high in starch and sugar, such as grain or sugar beets. In Southern Europe and the USA it is primarily made from maize.
The raw materials are used to produce a mash which is then fermented by adding yeast. This results in a product with a maximum of 18% ethanol. Through distillation, the alcohol content is raised to nearly 100%.
Admixture presently amounting to 4.7%
Since October 2007, approximately 4.7 % bioethanol has been added to petrol. Starting from 1 October 2008, the requirement will be to replace 5.75% of all fuels by biofuels.
As in the case of biodiesel, all motor vehicles are approved for a maximum admixture of 5% bioethanol. The car maker’s approval is required for the use of fuels with higher percentages of bioethanol added, such as E10 (petrol containing 10% ethanol), which is currently under discussion. Special vehicles (FFV or “flexible fuel vehicles”) become necessary only when Superethanol (E85) is used.
Bioethanol additives are produced in surrounding areas
The volumes of bioethanol used in Austria in 2007 were imported from Hungary and Germany, that is, from nearby countries. Hardly any bioethanol has been imported from Brazil, not least because of the high import duties imposed by the EU.
Since June 2008, ethanol has been produced in Austria from domestic raw materials like wheat, maize and sugarbeet in an amount sufficient to cover Austria’s needs.
Soy bean imports could be reduced
If the bioethanol plant at Pischelsdorf runs at full capacity, 180,000 tonnes of a protein animal feed (the equivalent of 130,000 tonnes of soy meal in terms of its value as animal feed) would be generated as a “by-product”. By using that by-product as a substitute for soy meal, Austria could reduce its soy imports by over 20%. This would also reduce the CO2 emissions resulting from imports.
Superethanol E85 – good for the environment and good for the car
Superethanol E85 is an environmentally friendly fuel that contains up to 85% bioethanol and at least 15% premium petrol.
In addition to the positive economic and environmental effects, Superethanol also significantly boosts performance by 15 to 20% and generates a higher torque, similar to that of diesel. In order to use E85, it is necessary to have vehicles specially adapted (flexi-fuel vehicles). Several car manufacturers are already selling flexi-fuel cars – at only minimal extra cost, or none at all. They are capable of running on both conventional petrol and E85.
Superethanol is cheaper than petrol; due to the lower energy density, however, it is necessary to refuel more often in order to cover the same distance. The lower price is made possible by the fact that the bioethanol component is exempt from petrol tax. A network of Superethanol filling stations is to be developed in the near future. There are currently 13 filling stations offering Superethanol in Austria (see www.superethanol.at ).
Biofuels – Austria has the necessary volumes and capacities
In 2007, Austria produced 241,381 tonnes of biodiesel, but it had the potential of producing about 470,000 tonnes per year. That is quite sufficient to cover the future demand on the domestic market. This production capacity is expected to increase further still in years to come.
Up to now, bioethanol has been procured from Hungary and Germany. Since June 2008 the Austria-based food company Agrana has been producing bioethanol at its plant in Pischelsdorf/ Lower Austria. If that plant is run at full capacity, it can produce 240,000 m³ of ethanol per year. In that case, cultivation of the raw materials used by the plant each year would require 70,000 to 95,000 hectares of farmland (that figure would vary according to the raw materials mix that is used).
Additional productive farmland thanks to putting fallow land back into use
Austria now has approximately 1,378 million hectares of farmland under cultivation.
In 2008, around 115,000 hectares were employed for bioenergy production (2007: 65,000 hectares). This increase over the preceding year is on the one hand due to the fact that the bioethanol plant at Pischelsdorf started operation. On the other hand, the extraordinarily high harvest of the year 2008 permits the use of oversupply quantities in the bioenergy sector.
Before 2007 farmers were required to let 10% of the arable fields lie fallow. In 2008, the obligation to let farmland lie fallow was lifted, making around 40,000 hectares of additional farmland available for food and bioenergy production.
In the entire European Union approximately 2.1 million hectares of set-aside land were again used for production.
Biofuels do not make food more expensive
There is a big gap between the subjective perception of prices and actual price developments. The consumer price index published by Statistik Austria confirms the opinions of many Austrians that food prices increased in 2007, but the long-term comparison puts this increase into perspective. Between 1986 and 2006, prices generally increased by 54%, whereas food prices increased by only 33%.
The higher prices were primarily due to poor harvests, especially in the big exporting countries Australia and the Ukraine, but also in the EU, as well as to the higher demand for food in Asia. This raised grain prices on the global market. Another factor was the increase in wages and energy costs in mills, bakeries and retail stores.
In 2008, the prices of grain and oilseeds decreased significantly again compared to 2007 – a result of the good harvests. However, this price development has not led to a reduction of food prices.
In general, it should be noted that the cost of raw materials accounts for only a relatively small part ofthe food prices. For instance, in the case of a breakfast roll, the cost of the wheat accounts for only 2% or in the case of a litre of milk, the cost of the raw milk accounts for only 33% of the retail price. The lion’s share of the prices is attributable to the costs of production, personnel, distribution, and advertising.
First food, then bioenergy
In the EU, food production clearly has precedence over bioenergy production. There are clear priorities for the farmers: The production of high-quality food comes first, followed by animal feed production, and only the remaining land is used to grow bioenergy sources.
Biofuels are not to blame for hunger in poor countries
It has recently been suggested that the production of biofuels results in price increases in the poorest and politically most unstable countries. In fact, in 2007 only 4.5% of the total global grain production was used for biofuels. Farm produce is available on the world market in sufficient quantities. Hunger is actually a distribution issue.
In many countries, this problem is exacerbated by a misguided farming policy. For years, they have failed to invest in their own agriculture because of the low prices on the global market. Now those countries are forced to buy grain at high prices on the global market. Nobody would have to go hungry anymore if political conditions were democratic, seed were made available to poor countries, and small farmers received fair market prices.
A minimum of standards
In certain countries, such as Brazil and Indonesia, parts of the rain forests are being cleared in order to grow sugar cane or oil palms for energy production. This has adverse effects on the environment and many small farmers, who are driven off their land. The European Union has adopted a certification system which is to ensure the sustainable production of raw materials (EU production and imports) for biofuel generation.
25.11.2009, Lebensministerium Öffentlichkeitsarbeit