Carl Mortished, International Business Editor
We've made some changes
to The Sunday Times
A new road fuel made from wood chips and straw will be launched in Europe later this year from a pilot plant developed by Shell and Choren Industries, the German biofuel company.
The synthetic diesel, made using a novel biomass-to-liquids (BTL) process, will shift the biodiesel industry into a higher gear by using waste plant material instead of valuable food crops.
The pilot plant, near Freiberg, will produce 15,000 tonnes per year of synthetic diesel, which Choren has dubbed Sunfuel. Construction of a much bigger plant in Schleswig-Holstein, costing €500 million (£336 million) and capable of producing 200,000 tonnes of BTL, will begin next year in an effort to quickly bring the product up to commercial scale.
Massive political and regulatory pressure is building on energy companies to find low-carbon alternatives to conventional road fuels. However, increased use of first-generation biofuels, such as ethanol and biodiesel made from rape-seed or palmoil, has caused the price of food crops, such as corn, to soar.
The cost of BTL is high compared with oil at $60 to $70 a barrel, admitted Ken Fisher, vice-president for strategy at Shell, but the company is confident that it can bring down the price with much higher volumes.
He expects full-scale production on a commercial basis by the middle of the next decade. “We would like to be the leading provider of second-generation biofuels,” Mr Fisher said.
BTL forms part of Shell’s portfolio of synthetic fuels, which it has called XTL, and includes gas-to-liquids (GTL) a diesel made from natural gas.
All the technologies are based on the Fischer-Tropsch process, invented in Germany in the 1930s to synthesise liquid fuels from coal. The process was initially uneconomic, but was used in Nazi Germany and in South Africa under apartheid when the country lacked access to crude oil.
The discovery of better catalysts and the rising price of crude is improving the commercial equation. Shell is building Pearl, a GTL plant in Qatar that will produce 140,000 barrels per day of synthetic diesel, an odourless fuel with zero sulphur emissions.
Shell has a second BTL investment in Iogen, a Canadian company that this week secured an $80 million (£41 million) grant from the US Government to build a plant in Idaho, which will produce cellulosic ethanol from plant waste and straw. Shell has not disclosed its investment in BTL, but analysts think it may have spent $100 million on the two projects and will need to invest several hundred million more to bring BTL up to commercial scale.
Shell is already the biggest biofuel distributor in the world. The cost of ethanol rose 70 per cent last year as the market reacted to the regulatory pressure to reduce carbon and sulphur emissions.
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How about using tobacco as a source of biomass for BTL fuels? That way, we could be cutting carbon emissions and cutting smoking-related deaths as well.
Katie, London, UK
The research on bio-fuels is very hot at the moment, and this progress sounds very good, but there is always a better way. The process of Gas To Liquid is unfortunately energy and capital-consuming. Are there other ways to convert bio-mass into bio-fuels? The answer is...Yes. Scientists are already busy with a new method that skips the conversion off Gas To Liquid and converts the biomass into liquid fuel. This process will use less energy and eventually will be better for the environment. Interested? Go to www.bio-e-con.com.
Wendy, Hoevelaken,
Is it a sound process or just a political sop?
Let us hope the former. However it does need to show the level of input of fossil fuel to produce a litre of this ethanol.
It is claimed that the process with corn for example uses at least 5 times the energy of fossil fuel to produce the energy of a litre of ethanol.
It sounds like we could have false hopes here
There are some very useful publications on this subject on the internet which really make sound reading.
John Flack, Shrewsbury, UK
What a totally ridiculous comment. It's absolutely brilliant that Shell are funding the R & D of these types of things. I would suggest that any day is a good day to introduce low carbon & renewable fuel. Stop being so backward.
james, London, England
Very good news, however "Massive political and regulatory pressure is building on energy companies..." no it isn't. The political and regulatory pressure is weak and insipid. If it was massive, we would be able to buy renewably fuelled cars by now, as they are available, but it is cheaper, and therefore more profitable, to continue to turn out oil based engines. Shell seem to have heeded the campaigns against them and are now playing it totally straight? I do hope so. As it happens, we run a 4x4 on vegetable oil anyway. But this is still excellent news.
Jennifer Hynes, Barry, Cymru
Well done Shell lets have more!
Waste biomass to fuel has to be good!
Jim Golightly, Prudhoe, England
without subsidy from goverment or massive capital injection from big company, this non-profitable business could not last for a long time. but the prospect of the this industry should be good and must be good as we do need a clean alternative energy in the future.
Jacky, BJ, Chian
BTL, CTL, & GTL all produce syngas, CO + H, to produce Fischer-tropsch diesel which is superior in all ways to diesel fuel made from oil. BP and DuPont are working together to produce and market Butanol, a superior alcohol fuel with 24% more energy per gallon than ethanol. Butanol can be easily blended with diesel fuel in large percentages and used 100% in ordinary internal combustion engines. It also is much less volatile than gasoline or ethanol and less of an air pollution problem in hot climates.
In addition BTL and alcohol fuels including butanol are carbon neutral because the biomass used for these fuels comes photosynthesis using atmospheric CO2 not previously sequestered carbon from fossil fuels.
John Adam, Hebron, Ohio
The 'very serious problems' appear to be down to the refinery getting their recipe wrong... too much of certain additives in conventional fuel. It has no relevance at all to whether or not it's a good idea to produce basic fuel from a source other than crude oil. Technologies such as this have the potential to significantly reduce carbon emissions (over the cycle of plant growth to vehicle exhaust.)
Incidentally, Henry Ford originally designed the Model T to run on
alcohol, so that farmers could ferment and distilled their own fuel. And Rudolf Diesel originally intended his engine to run on vegetable oil. So there's a very long history of bio-fuelled internal combustion vehicles.
Paul, London,
It will be interesting to see how this fares against the corn lobby in the US. This type of synthetic fuel for some vehicles, along with electric cars/scooters powered from clean sources, combined with an overall reduction in the number of cars on the road, is the future.
Scott Redding, Coventry,
I would suggest that in view of the very serious problems being experienced by thousands of motorists as a result of using 'improved' petrol this is not a good day to be introducing another synthetic fuel.
Alfred, Woking,