Bio Fuels
Grown domestically on almost every continent on earth, the commodity has been hailed both a savior and a rogue by advocates of the environment, economy, and food security. The international bio fuel industry is nothing if not political.
In discussing commercially available renewable fuels, two distinct categories emerge: bio diesel and ethanol. Bio diesel, also known as fatty acid methyl ester (FAME), can be produced from any lipid-based feedstock such as soybean or canola oil. Ethanol is an alcohol made predominantly from wheat and corn in North America and sugar in Brazil, currently the world’s leading producer.
The increasing shift from reliance on traditional fossil fuels to bio fuels has significant implications for environmental sustainability and pollution reduction. “Multiple life cycle analyses and EPA studies have shown that there is nearly a 75 per cent drop in the C02 equivalent output with each unit of bio diesel that is burned replacing a liter of diesel,” says Alex Russell, director of fuel operations at Canadian Bioenergy Corporation in Vancouver, British Columbia.
As awareness of alternative fuels sources increase, the bio fuel industry is gaining influence and prominence internationally. “It’s been a viable alternative in Europe for probably 15 years now - they have more diesel cars, and they’re more advanced in terms of environmental policy. They have a larger population and higher density so they’ve had to think about environmental issues more closely whereas in Canada and the US we’ve had cheap resources and plenty of them, so we haven’t necessarily been constrained in that manner.”
As a result, the bio fuel industry is shifting from a predominantly fractured production base to a more powerful concentration of interests. Though previously sustained by multiple independent producers , the past two years has seen the North American bio fuel industry aggregated under the careful hand of an elite group of bio energy and agribusiness giants. Players with major stakes in the industry include Bunge, directed by CEO and chairman of the board Alberto Weisser (Bachelor of Business Administration and graduate of INSEAD’s Management Development Program); ADM (Archer Daniels Midland) run by former Chevron International President Patricia A. Woertz (BSc in Accounting and a graduate of Columbia University’s International Executive Development Program) who holds court as chairman of the board of directors, chief executive officer, and president; Cargill, presided over by chairman and chief executive officer Gregory R. Page (Bachelor of Economics) ; and REG (Renewable Energy Group), directed by chairman and chief executive officer Jeffrey Stroburg (BSc).
The current round of bio fuels falls under the category of first generation – renewable fuels, feedstock and technologies that have been commercially proven. Due to operational and environmental challenges, there is a push to develop second-generation fuels - an evolution of the first. The goal of the second wave is to make renewable fuels more fungible with refined petroleum products. Second generation feedstock's include cellulosic fibre, algae, and sugar; once refined they will behave similarly to diesel and gasoline, their petroleum counterparts. The leader in second generation bio diesel technologies is Neste, a Finnish company. Through a proprietary conversion process, Neste can convert any vegetable oil or fat into a renewable diesel product that is entirely fungible with petroleum diesel.
North America is currently implementing renewable fuel standards (RFS) whereby the petroleum industry will be mandated to incorporate anywhere between 2 – 5 per cent renewable fuel content in the petroleum fuel pool. Within US president Barack Obama’s economic stimulus package, $1.1 billion is earmarked to support the bio fuel industry and enable it to meet a federal RFS2, in which 2 per cent of the fuel pool must be contain renewable fuel content.
In the same package Obama has directed close to $800 million towards continued research, development and implementation of second-generation renewable fuels. The field of second generation bio fuels looks much like the early stages of the first generation being made up of innovative, entrepreneurial start-up companies, whose progress is being closely monitored by large petroleum and agricultural corporations.
“In 2010 we should see an acceleration of the North American bio diesel industry,” continued Russell. “Renewable fuel mandates are being implemented in both the US and Canada and there will have to be enough domestic supply to meet this demand.”
EDUCATION SIDEBAR Applicable college or university degree programs for the bio energy industry include:
- Logistical expertise to manage inventory, quality and shipment of large volumes of agricultural and energy commodities.
- Science-based specialists like oleochemists, organic chemists, and chemical engineers,
- Technical expertise to manage bio fuel plants: systems engineers, plant technicians, environmental engineers
- Policy analysis and development- political science
- Finance specialists for accounting, business modeling, risk management, procurement
- Legal appointment for in-house counsel and grain contracts.
- Business development for the generation of sales, marketing, and HR.
Share Us