The enormous potential of advanced bio-fuels

The starting pistol has sounded in the race to meet EU and global energy-saving targets – and biofuels does not want to be left behind.

Biofuels offer three big advantages - scalability, sustainability and cost - and EU and national legislators should seriously consider advanced biofuels as a peer, not as a poor cousin of wind and solar.

First, biofuels are sustainable.

Replacing fossil fuels with biofuels has the potential to generate a number of benefits. In contrast to fossil fuels, which are exhaustible resources, biofuels are produced from renewable feedstocks. Thus, their production and use could, in theory, be sustained indefinitely.

Biofuels offer a sustainable solution that can be used as a direct replacement to fossil fuels and will help significantly cut emissions with the urgency that is required. Long term, biofuels are also better for the environment than wind and solar.

European renewable ethanol and biodiesel are proven to significantly reduce greenhouse-gas emissions and biofuels production in European bio refineries also contributes to EU food security.

Second, biofuels can, over time, be cost-effective.

Currently, costs may be high but this is largely due to insufficient financial support and costs will fall as production ramps up.

Capturing CO2 from biofuels is relatively cheap compared to other bioenergy and carbon capture options.

While the average production cost of biofuels is still double to triple that of fossil fuel equivalents, it could decline by as much as 27% over the next decade, with any remaining cost gap covered by policy measures to spur production and demand.

That leads to the third tenet of biofuels: its scalability.

Biofuels can (and should) be used for so much more, for example, green hydrogen production. The solutions are already in existence – now it is a matter of radically increasing scale and application.

It is also essential to scale up production of these renewable gases in order to meet renewable energy demand by 2030 and achieve climate targets in 2050.

One example of this technology’s potential is “BECCS” hydrogen (bioenergy with carbon capture and storage), which generates hydrogen from biogenic feedstocks. It offers a unique approach and is a versatile fuel for net zero, carbon dioxide removal.

BECCS hits two key net zero targets simultaneously: energy transitions and CO2 removal. Using only abundant sustainable biomass, this technology can deliver both sustainability and scalability.

BECCS hydrogen also looks like it will be cost competitive - lower than green hydrogen by 2030 .

But much more support is needed to promote development, commercialisation and deployment of hydrogen BECCS at scale.

Support is vital and the EU would do well to look across the Atlantic at what the U.S is doing to back its biofuels market.

The IRA – Inflation Reduction Act - provides incentives to various sectors, including the biofuels industry.

This contrasts with the EU’s Green Deal which, conversely, merely encourages consumers to change their behaviour in order to help meet various climate and energy targets.

The EU does not, unlike the Americans, offer any financial support. EU investment in the biofuels sector sharply contrasts with the U.S which has made some $9.4bn available for biofuels.

The Americans provide a variety of economic incentives, including grants, income tax credits, subsidies and loans to promote biofuel research and development. 

EU policymakers considering ways to address its energy-related challenges should be aware of the strategic contribution that domestically produced biofuels can make.

A priority for the EU is to develop renewable hydrogen and it aims to produce 10 million tonnes and import 10 million tonnes by 2030 - but that is currently some 160 times more than current production of hydrogen.

Demand for biofuels in 2022 actually rose by 6%, reaching a record high and surpassing levels seen in 2019 prior to the Covid-19 pandemic.

To fully realise its goals of achieving energy and food independence, the EU must mobilise its entire bioenergy sector.

The bottom line is that biofuels has the potential to better meet various emission-cutting objectives than renewables like wind and solar.

The biofuels sector wants to invest in Europe and has some excellent products but much more help is needed to increase the uptake of sustainable fuels and foster development of advanced biofuels and hydrogen.

So far, the EU has underestimated the enormous potential and scalability of ultra-sustainable biofuels and in order to reach its targets and goals bioenergy is going to need to step up – and fast.

Share this article: