BioCycle December 2007, Vol. 48, No. 12, p. 40
Biomass Energy Outlook
THAT is a billion dollar question. If carbon is in the form of an air emission, it can be a billion dollar cost. If it is in the form of starch in corn ($4/bushel), carbon can be a billion dollar asset. Every month, BioCycle addresses new facets of discovering the value of carbon. This month’s column begins to look at a way to standardize and compare various carbon source values based on energy content.
The first step in the process is to determine the metric for the carbon source of interest. One measure of greenhouse gases is a carbon dioxide equivalent, or tons of carbon sequestered. Carbon in water quality evaluations is measured in terms of COD (chemical oxygen demand – a measure of bacterial growth potential). Anaerobic digestion engineers look at the volatile solids content (this is similar to COD, but different).
Each “bio” market and each regulated waste use a different standard to define carbon. Within a specific industry like composting or biofuels, the participants have at least a working knowledge of quality standards for their industry. Similar legal standard comfort levels also exist within each regulated community. Historically each industry has developed under the regulatory oversight of a specific environmental agency.
Today, with the arrival of biomass energy, both the beneficial value of carbon and the regulatory cost of carbon management are all scrambled up. This disarray of standards and terms for carbon makes it difficult to explore economic opportunities. Agriculture discovered this last year when it dove head-first into growing feed crops (corn, soybeans and wheat) for bioenergy production. One of the first challenges was replacing the livestock feed value of corn that was now going to ethanol production. The price of corn nearly doubled.
In the long run, corn, soybeans and wheat are not efficient energy crops. Switchgrass and poplar trees will produce much greater energy yields per acre, once the technology to break fiber down into sugars becomes commercially available. Until that time though, grain producers are enjoying high prices for their grains.
Landfills, wastewater treatment plants and power plants also are exploring new energy revenues from biofuels, anaerobic digesters and algae production. Coordinating the technical and policy components of these new carbon-based, bioenergy projects is a nightmare.
COMPARING ENERGY VALUES
A few months ago, I began converting weekly prices to energy equivalents in BTUs (British Thermal Units). Tabled heating values are available for many kinds of organic materials. Dry solid materials are commonly presented in BTUs per pound. Liquid fuels are reported in BTUs per gallon. With a little effort it is possible to find prices and heating values reported for nearly any carbon-based material. Adjustments are made for removing moisture from the agricultural products that are sold “as is” so that they will align better with the energy fuels that are estimated in bone dry tons. Units of volume can be standardized by putting everything in terms of million BTUs (MMBTU). The result is an estimated energy value in $/MMBTU that allows comparison of the energy values of almost anything.
Picking prices from the third week of November, crude oil that sold for $94.81/barrel has an energy value of $16.35/MMBTU. Gasoline with a pump price of $3.099/gallon has an energy value of $24.79/MMBTU. One of the pitfalls of this simple comparison is that based on these numbers, it is easy to conclude that crude oil is a better bargain than gasoline. However, it takes an additional amount of energy to refine crude oil (that isn’t ready to use) into gasoline (that is ready to use). Of all the materials that I track each week, the best energy value is for Illinois coal with 5 percent sulfur. It sells for $33.50 a ton and has an energy value of $1.42/MMBTU.
From a bioenergy perspective, these products are the fossil fuel competition for biofuels. Ethanol selling at a price of $1.82/gallon has an energy value of $23.95/MMBTU. Biodiesel selling at $3.80/gallon has a value of $32.20/
MMBTU. Soybean oil was selling for 43.8 cents/pound the third week of November, which gave it an energy value of $25.78/MMBTU. Before converting it to a fuel, vegetable oil was already as valuable as gasoline.
Solid fuels also work within this framework. Fuel pellets selling for $214.20/ton have an energy value of $13.39/BTU. Shelled corn selling for $3.91/bushel is valued at $8.57/MMBTU. So if your fuel pellet stove also burns corn, corn is a much better value. Compost selling for $25/cubic yard has an energy value of $3.63/MMBTU. I am not promoting this. It is a lot easier to remove the moisture from compost mathematically than it is in real life.
And finally, good quality grass hay selling for $81/ton has an energy value of $5.40/MMBTU. This has some interesting implications. Most biomass economic studies like to focus around a breakeven market price of $50/ton of cellulose. Hay is thermodynamically equivalent to switchgrass, and the hay market is commanding $80/ton. This is partly due to regional droughts around the country.
Of the prices discussed here, hay has the best (lowest) energy value next to coal. So is $80/ton high for hay and biomass energy, or is $5/MMBTU a great value for fuel? Time will tell. One aspect that does not appear in this energy value is the density. I also track the densities and a great value for hay of $5/MMBTU does not convey that it is nearly eight times less dense (more fluffy) than coal. While environmental aspects are not included in this measure, standardizing energy values on the common denominator of energy content enables a starting point for comparisons.
Mark Jenner, PhD, is the owner of Biomass Rules, LLC and has over 25 years of biomass utilization expertise. Burning Bio News is Jenner’s monthly scorecard of bioenergy project adoption, available at www.biomassrules.com.
December 19, 2007 | General
Biomass Energy Outlook: What Is The Value Of Carbon?
BioCycle December 2007, Vol. 48, No. 12, p. 40