If you could turn lead into gold… how much would lead cost?

In this blog, EBRI Research Associate Jim Scott discusses the pros and cons of bioenergy technologies and the opportunities they offer.

Bioenergy is big business. When you think of renewable energy in Europe you probably think of wind turbines and solar panels, probably made by Siemens. But actually the vast majority of growth in primary renewable energy planned to meet the EU carbon reduction targets is required to come from biomass sources. This has not gone un-noticed by the city suits.

For wind turbines and solar panels the technology race has been run and won, most turbines are white with three blades, most solar panels are blue and made in factories far overseas. But for biomass it’s open season for technology inventors and investors. The industry has developed some clear segments, especially in the developed European economies. At the core is the safe bet; combustion technologies burning wood pellets, a highly commoditised, high value, tradable fuel. Wood comes with its own nuances and problems but for most purposes it may as well be any other solid fuel. This works, we have been doing it for millennia. For a little more risk comes the higher value adding applications of biomass, combustion of other agricultural residues, usually deployed for co-firing with coal or for dedicated power generation from biomass. Coconut husks, olive residues, palm kernels and rice husks all fit a niche in the large combustion power sector with great opportunities to export, import, trade and add value for various middlemen, seizing their opportunity for quick wins driven by legislation and the reluctance of large power generators to engage with their supply chains. Actually aligning buyer with supplier can prove harder than expected however.

Moving up another layer of risk are the more delicate technology solutions. Anaerobic Digestion (AD) and gasification technologies have been around for years yet are struggling to find traction on the generation-side in most EU markets. AD remains a dark art, most books and presentations on the topic focus on pitfalls rather than opportunities. These pitfalls are mainly around plant capacity, location, operational practice, standards for testing and comparison of technology and feedstock and also in the contracts available for the (usually waste) feedstocks. There are also concerns from investors that the juicy incentives dished out for AD technology in Germany, Sweden and the UK have allowed it to skip the painful technology optimisation and specialisation phases that solar and wind have endured. There’s always the suspicion that the best AD technology is yet to be invented; but also that it lies just around the corner in a professors back yard.

Gasification holds great promise for higher efficiency conversion of biomass and the production of other bio-based chemical processes. However the track record of gasification deployment is an almost solid trail of failed, mothballed projects, there are scant few examples of successful gasification projects using biomass. Gasifier projects do fail, and to invest in one must always be considered a gamble. In a sign of an immature market, blame for failure is passed between developer, technology provider and operator, as if finding a guilty party would fix the problem. However get the combination of technology, feedstock and operation just right and gasification is a sunlit door to long term cash flows. Worth the risk? Rolling the biomass dice again we start to encounter the raggedy edge of technology development for bioenergy conversion, ideas that have seen the light of day but remain un-commercialised. These technologies reside in petri-dishes, tubes, on lab benches and demonstration projects, cooking and catalysing complex compounds, shrouded by patents and pre-qualifying statements – kit with no price-tag. But the upside for those willing to do the leg-work, ask the hard questions and understand the complicated ‘well… it depends’ answers are massive. Alchemy for the consumer economy, turning societies waste into energy, and hard cash – as a by-product of course. And here lies the real prize for the bioenergy investor and the real chance for the generation revolution of our generation.

This is not the wind industry, nor the solar industry. It is not a technology led industry. There will be no bioenergy equivalent of the white three bladed composite wind turbine that is synonymous with the word renewables, the industry and the future of energy generation. Unlike wind and solar bioenergy technologies do not stand alone in a field looking majestic or static depending on your view. Instead bioenergy projects are embedded within our society, especially when fuelled by wastes. Therefore to properly understand the expected performance of a technology we must properly understand the scenario in which it will be deployed, and this real-world attitude to projects is where many bioenergy projects come unstuck. How will the project compete in the current waste management landscape? How will it perform with less than ideal or totally out of spec feedstock? How can the feedstock be guaranteed for the project life? The technology engineers’ response to these problems is usually to design a plant that can cope with the worst -case scenario, instantly out pricing the technology from the market. If we are to realise the potential in our waste streams we must be prepared to deploy suites of technologies that together can best convert the available material. Not roll out old ideas, or shoe-horn unsuitable technologies into good market opportunities just because they look most ready. There is no silver bullet for waste or biomass conversion, but there is a group of technologies, most of which exist, that can open realistic levels of investment to meet the carbon and waste reduction targets Europe is looking for. We only need to be willing to split the profits a little.

Words by Jim Scott
Research Associate at EBRI