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www.eia.govU.S. Energy Information Administration Independent Statistics & Analysis
International Biomass Conference and Expo
Dr. Richard Newell, Administrator
May 03, 2011 | St. Louis, Missouri
Biomass in the United States Energy
Economy
Overview
2Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
• The potential for biomass and biofuels
– Potential biomass supply chain
– Biofuel corporate landscape
– US biomass consumption by sector and type
• Electricity sector
– Reference case power generation projections
– Alternative cases
• Liquid fuels sector
– Current state of industry
– Reference case biofuel projections
– Effects of fuel efficiency
– Sensitivity on E15 penetration
• EIA data available to the public
– Ethanol
– Biodiesel & renewable diesel
– Biomass for electricity
There are many sources and many uses for
biomass
3
Raw inputs
• Corn
• Soy
• Other seed crops
• Livestock
• Forestry
• Energy crops
• Municipal solid waste
Feedstocks
• Virgin oils
• Starch
• Fiber
• Fat & grease
• Lignocellulose
Energy products
• FAME biodiesel
• Renewable diesel
• Ethanol
• Butanol
• Gasoline
• Diesel
• Heat & power
http://www.alabamapower.com/renewableenergy/biomass.asphttp://www.ranchomastatal.com/img_bank/phpgbb3eY_IMG_0182.JPG http://www.e85fuel.com/images/sized/images/uploads/blender_pump_prices-
700x231.jpg
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
Corporate landscape for 1st generation
biofuels
4Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
• Diesel blendstocks– Vertically integrated majors:
Archer Daniels Midland
– Large refiners: Renewable
Energy Group, Renewable
Biofuels, Imperium Renewables,
Biodiesel of Las Vegas, Green
Earth Fuels of Houston, Louis
Dreyfus, Delta Biofuels, Inc
– Medium/small refiners:
Keystone BioFuels, Inc., Fina,
LLC, AGP, American Energy
Producers, Inc., Owensboro
Grain, Lake Erie Biofuels, Delta
American Fuel, LLC, Innovation
Fuels
• Alcohol production
– Vertically integrated majors:
Archer Daniels Midland
– Large refiners: Poet Ethanol
(throughout U.S.), Valero Refining
(throughout U.S.), Green Plains
Renewable Energy (Midwest),
Flint Hills Resources, LLC (IA),
Abengoa (KS, IL, NM, NE, IN)
– Medium/small refiners: Big River
(East IA, West IL), The Andersons
(West OH, IN, South MI), White
Energy (TX, KS), Aventine
(Central IL, NE), Biofuel Energy
(MN, NE)
Next generation biofuel companies are
developing numerous strategic relationships
5
Products and co-products
Biofuels
• Gasoline
• Diesel
• Ethanol
• Butanol
• Biodiesel
• Lubricants
Chemicals
• Polymers
• Consumer products
• Nutraceuticals
2nd generation alcohols
3rd generation biofuel producers
Technology Legend
Genetics companies
2nd generation non-alcohol liquids
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
Technology Company
Codexis
Virent
Vercipia
Butamax
Danisco
Solazyme
Zeachem
Mascoma
Terrabon
Solix
Algenol
LS9
Amyris
Iogen
Partner
Royal Dutch Shell
BP
Chevron
Valero
Dow Chemical
Proctor & Gamble
Du Pont
Tate & Lyle
EIA projects that consumption of biomass for liquid fuels and power
will increase significantly, driven primarily by cellulosic biofuels
6Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0
2
4
6
8
10
2010 2015 2020 2025 2030 2035
US biomass supply
quadrillion Btu per year
Source: EIA, Annual Energy Outlook 2011
Cellulosic biofuels + electric power
Grains, fats, & oils
Industrial CHP (primarily pulp & paper)
Despite this rapid growth, under current policies, fossil fuels
still provide 78% of U.S. energy use in 2035
7
Nuclear
Oil and other liquid fuels
Liquid biofuels
Natural gas
Coal
Renewables (excluding liquid
biofuels)
0
20
40
60
80
100
120
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035
U.S. primary energy consumption
quadrillion Btu per year
Source: EIA, Annual Energy Outlook 2011
History Projections2009
37%
25%
21%
9%
7%
1%
33%
24%
21%
10%
8%
3%
Shares of total U.S. energy
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
Policy and crude oil prices have worked in favor of biofuels
8Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0.0
0.5
1.0
1.5
2.0
2.5
3.0
2010 2015 2020 2025 2030 2035
AEO2011
AEO2007
US biofuels consumption
million barrels per day
Source: EIA, Annual Energy Outlook 2007 and 2011
0
25
50
75
100
125
150
175
200
225
1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035
The future market for biofuels depends on the world oil price
path, which is highly uncertain
9
annual average price of low sulfur crude oil
real 2009 dollars per barrel
Source: EIA, Annual Energy Outlook 2011
ProjectionsHistory 2009
High Oil Price
Low Oil Price
AEO2011 Reference
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
In EIA projections, cellulosic biomass of three different types is
consumed in liquid fuels and for power production
10Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0.0
0.5
1.0
1.5
2.0
2.5
2010 2015 2020 2025 2030 2035
Energy crops/ag residues
Forestry residues
Urban wood waste
cellulosic biomass consumption
quadrillion Btu per year
Source: EIA, Annual Energy Outlook 2011
Liquid fuels markets and electric power compete for the same
biomass supply in EIA projections
11Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
• Behind the projection, EIA has
a large biomass potential
supply over a range of prices
• As crop yields and other farm
management practices
improve, biomass available in
a given year increases
• But the liquid fuel sector does
not have access to urban/mill
residues and forestry residues
from Federal lands, which
limits some of the growth0
20
40
60
80
100
0 200 400 600 800
Million Dry Tons per Year
2012
2020
2030
2008 $ per dry ton
Electricity
12Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
Natural gas, wind and other renewables account for the vast
majority of capacity additions from 2009 to 2035
13
Source: EIA, Annual Energy Outlook 2011
Coal
313 (30%)
Natural gas
351 (34%)
Hydropower*
99 (10%)
Nuclear
101 (10%)
Other
renewables
15 (1%)
Other fossil
118 (11%)* Includes pumped storage
Coal
14 (6%)
Natural gas
135 (60%)
Hydropower*
3 (1%)
Nuclear
6 (3%)
Other renewables
28 (12%)
Other
fossil
1 (0.4%)
2009 capacity Capacity additions 2009 to
2035
1,033
gigawatts
223gigawatts
Wind
25 (11%)
Wind
32 (3%)
End-use coal
4 (0.3%)
End-use coal
12 (5%)
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0
50
100
150
200
250
300
350
400
450
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035
ProjectionsHistory 2009
Non-hydro renewable sources grow nearly three-fold, meeting
22% of projected electricity generation growth
14
non-hydropower renewable generation
billion kilowatthours per year
Source: EIA, Annual Energy Outlook 2011
Wind
Solar
Biomass
Geothermal
Waste
Industrial CHP
Power sector
Advanced biofuels
cogeneration
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
In the Reference Case, power generation from biomass sources
is limited in the electricity sector; main growth in co-generation
15Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0
25
50
75
100
125
150
175
2010 2015 2020 2025 2030 2035
End Use cogeneration
biomass power generation
billion kilowatt hours per year
Source: EIA, Annual Energy Outlook 2011
Cofiring in coal power plants
Dedicated biomass power plants
When renewable tax credits are extended indefinitely, wind and solar
capture market share at the expense of biomass and geothermal
16Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
total electricity generation
billion kilowatt hours per year
Source: EIA, Annual Energy Outlook 2011
0
100
200
300
400
500
600
700
800
900
Current 2010 Reference 2035 No Sunset 2035
Hydro & other
Wind
Solar
Biomass
Geothermal
Liquid fuels
17Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
The liquid fuels industry landscape has changed rapidly in recent
history due to the economy, biofuels, fuel economy, and oil prices
18Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
• Liquid biofuels provide
blendable fuels for
transportation
• Makes them one of the
most straightforward
substitutes for
petroleum
• But the path has been
and remains
challenging6.4
6.8
7.2
7.6
8
8.4
8.8
2000 2005 2010
Ethanol Petroleum Gasoline
U.S. motor gasoline consumption
million barrels per day
The import share of liquids consumption drops over the projection
due in part to increased fuel efficiency and biofuel production
19
U.S. liquid fuels consumption
million barrels per day
Source: EIA, Annual Energy Outlook 2011
0
5
10
15
20
25
1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 2025 2030 2035
ProjectionsHistory
Natural gas plant liquids
Petroleum supply
Biofuels including imports
Net petroleum imports
2009
13%
11%
41%
32%
10%
52%
34%
4%
Liquids from coal
3%
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
Domestic biofuels production grows rapidly, displacing 1.25 million barrels
per day of gasoline and 360,000 barrels per day of diesel by 2035
20Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0.0
0.5
1.0
1.5
2.0
2.5
2010 2015 2020 2025 2030 2035
U.S. biofuels production
million barrels per day
Source: EIA, Annual Energy Outlook 2011
Starch ethanol (mostly corn)
0
5
10
15
20
25
30
35
40
45
2000 2005 2010 2015 2020 2025 2030 2035
New light duty vehicle fuel economy achieves almost 38 mpg by
2035 in the Reference case, slowing the growth of fuel demand
21
miles per gallon
Source: EIA, Annual Energy Outlook 2011
2009 ProjectionsHistory
Summary of standards
2012-2016: 34.1 mpg CAFE average (based on NHTSA vehicle footprint sales distribution)
2020: 35 mpg by statute
2017-2025: Reference case does not include proposal planned for September 2011
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
FFVs make up the largest share of unconventional vehicles, which
account for 40% of U.S. light-duty vehicle sales in 2035
22
U.S. light car and truck sales
millions
Source: EIA, Annual Energy Outlook 2011
0
5
10
15
20
2000 2009 2015 2020 2025 2030 2035
Conventional gasoline
Diesel
Gaseous and fuel cell
Mild hybrid electric
Hybrid electric
Plug-in hybrid and all-electric
E85 flex fuel
Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
E85 infrastructure needs for meeting the RFS depend on the
penetration of E15 into the marketplace
23Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
0
5
10
15
20
25
30
35
40
45
2017 2022 2035
Slow E15 Penetration Reference Case Fast E15 Penetration
Ethanol blending into E85
1000s of stations
Source: EIA, Annual Energy Outlook 2011
Summary and view to the future
24Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
• Policy changes and higher oil prices are moving the United
States to more use of biofuels
• Uncertainties still lie ahead
– Land use
– Infrastructure changes
– Technology development
– Political and market uncertainties
For more information
25Richard Newell, Biomass Conference
St. Louis, MO May 3, 2011
U.S. Energy Information Administration home page | www.eia.gov
Short-Term Energy Outlook | www.eia.gov/steo
Annual Energy Outlook | www.eia.gov/aeo
International Energy Outlook | www.eia.gov/ieo
Monthly Energy Review | www.eia.gov/mer
EIA Information Center
(202) 586-8800 | email: InfoCtr@eia.gov
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