Abengoa Bioenergy proposes $250 million investment in cassava based biofuel facilities in the Philippines

President Gloria Macapagal-Arroyo today announced the plan of Europe's largest ethanol producer, Abengoa Bioenergy, to invest $250 million to develop 50,000 hectares of cassava plantation in the Philippines for the production of feedstock for biofuel facilities in the country. Under a Memorandum of Understanding (MOU) signed with the Philippine Agricultural Development and Commercial Corporation (PADCC), Abengoa Bioenergy will also provide technical assistance in identifying varieties of cassava for trial cultivation, in developing high starch yielding types, in tropical agronomy, and in training farmers.

Abengoa Bionergy, subsidiary of energy company Abengoa SA, operates bioethanol facilities not only in Europe but also in Brazil and the United States, where it is the fifth largest producer. It is a developer of next-generation biofuel technologies based on the enzymatic hydrolysis of biomass and operates one of the first such cellulosic ethanol refineries (plant in Salamanca: 5 million liters/year).

The planned distillery in the Philippines is expected to produce one million to 1.2 million tons of feedstock, and generate about 150 to 200 million liters of bioethanol annually, making it a large facility.

Cassava's efficiency
Abengoa Bioenergy's project will consist of establishing dedicated cassava plantations on around 50,000 hectares of land, and of training the farmers and outgrowers who will manage the fields.

Cassava is seen as a promising energy crop because of its high starch yield and its low input requirements; moreover, it can be grown on relatively degraded land. Scientists have found that ethanol made from the plant is highly efficient: it has a strong energy balance and reduces greenhouse gas emissions considerably (previous post).

According to the International Center for Tropical Agriculture (CIAT), which aims to alleviate rural poverty in the developing world, the new opportunities brought by the biofuels sector could help lift millions of small farmers across South East Asia out of poverty (earlier post). Cassava starch prices have been low for years and the plant is traditionally seen as 'the poor man's crop'. But according to the CIAT this situation may soon change because of biofuels:
energy :: sustainability ::biomass :: bioenergy :: biofuels :: ethanol :: cassava :: starch :: plant breeding :: efficiency :: energy balance :: poverty alleviation :: Philippines ::

CIAT is a member of the Consultative Group on International Agricultural Research (CGIAR), a 'Green Revolution' consortium of research organisations that fosters sustainable agricultural growth through high-quality science aimed at benefiting the poor through stronger food security, better human nutrition and health, higher incomes and improved management of natural resources.

The MOA on cassava between Abengoa Bioenergy and the DA, was signed by Undersecretary Bernadette Romulo Puyat and Javier Salgado Leirado, chairman of Abengoa, during a two-day state visit of President Arroyo to Spain. The agreement is valid for one year.

Puyat said that aside from providing the design engineering and the machinery required for the development of cassava plantations, Abengoa will also study the possibility of establishing bioethanol production plants in the Philippines.

Through the Abengoa-PADCC Working Committee, the PADCC will be tasked to assist the Spanish company in conducting capability enhancement training for farmers, particularly in the area of enterprise management, she said.

Puyat said that Abengoa will also lend its technical expertise in agriculture in developing high yielding varieties and increasing feedstock productivity.

Agriculture Secretary Arthur Yap said that Abengoa and PADCC, along with the DA Biofuel Feedstock Development Program, can further enter into partnerships focusing on energy crops development and cost-competitive biomass technology.

We hope that Abengoa will immediately move forward its initial understanding with PADCC into concrete timelines to cover the early completion of the feasibility study and the immediate implementation of the project, preferably within 2008. - Arthur Yap, Agriculture Secretary of the Philippines

Last January, the president signed into law Republic Act (RA) 9367 or the Biofuels Law, which aims to ease the country's dependence on imported, dollar-draining and pollution-generating energy sources by making the blending of ethanol and biodiesel in petroleum products mandatory.

This proposed investment can boost our long term-goal in biofuel production and the development of alternative fuel sources in these days of rising fuel costs. - Gloria Macapagal-Arroyo, President of the Philippines

The Philippines' attractiveness
The Philippines are ranked as a country with a large sustainable biofuel potential (see Biofuel Country Attractiveness indices for Q1 and Q2 of this year). This ranking is due to its abundance of land and a suitable agro-climatic environment for the production of high yielding energy crops; its central location in the fastest growing fuel market, East and South East Asia; and its clear policies and stable investment climate.

This has led to a number of large foreign investments from Chinese, Japanese, European and American companies, often in partnership with local companies. Projects involve the production of fuels from crops like sugarcane, new sweet sorghum hybrids, cassava, jatropha, and grass species dedicated to biomass production.

Earlier this month, Bionor Transformacio S.A., a leading European biodiesel firm based in Bilbao, also disclosed plans to invest $200 million in the Philippines to develop at least 100,000 hectares of jatropha plantations to be used as feedstock for biofuel facilities in the country (previous post).

Earlier, PNOC-Alternative Fuels Corp, the alternative fuels subsidiary of state-owned Philippine National Oil Co., signed a memorandum of understanding with UK-based Natural Resources Group Chemical Engineering under which the latter will pump $1.3 billion into the Philippines' biofuels sector.

The companies are looking at building a 3.5 million mt/year biodiesel and a 350,000 mt/year ethanol plant in the country and will also invest in jatropha plantations (earlier post). PNOC-AFC also signed an agreement with South Korea's Samsung in September 2006 to set up an integrated jatropha plantation and biofuels project.

US firm E-Cane Fuel Corp. announced it will invest €111/US$150 million to put up a fully integrated ethanol processing facility in Central Luzon, with sugarcane as the main feedstock (previous post).

Japan's Marubeni has also announced plans to set up five ethanol plants in the Philippines and local firm San Carlos Bioenergy is already building a 120,000 liters/day ethanol plant in the country.

The Philippine Department of Agriculture also sealed an agreement with India-based bioenergy company Praj Industries to help develop the country's nascent biofuels industry. Under a Memorandum of Understanding both parties will team up for feedstock development and setting up biofuel production plants (more here).

According to the Philippine Coconut Authority (PCA) Japanese firm Toyo Engineering Corp. recently announced it is about to complete a feasibility study on an integrated coco methyl-ester (CME) manufacturing plant that it plans to put up in the Philippines' northern region of Ilocos. It is further looking at 600,000 hectares of coconut plantation (earlier post).

Existing coco-biodiesel production capacity in the country is 140 million liters/year from two major companies alone - Chemrez and Senbel Fine Chemicals. At least 10 other smaller producers are said to have registered with the DOE for accreditation.

Finally, Brazil has agreed to intensify cooperation in energy security, particularly in the development and use of biofuels, with the Philippines. The countries agreed to boost cooperation in the development and use of ethanol, biodiesel and biomass energy (more here).


References:
Philippine Information Agency: PGMA welcomes proposed $250-million investment in biofuel facilities in RP - December 15, 2007.

Biopact: First comprehensive energy balance study reveals cassava is a highly efficient biofuel feedstock - April 18, 2007

Biopact: CIAT: cassava ethanol could benefit small farmers in South East Asia -
September 24, 2007

Biopact: Bionor to invest $200 million in jatropha plantations in the Philippines - December 3, 2007.

Biopact: CIAT: cassava ethanol could benefit small farmers in South East Asia - September 24, 2007

Biopact: First comprehensive energy balance study reveals cassava is a highly efficient biofuel feedstock - April 18, 2007

Biopact: Biofuels and renewables 'Country Attractiveness Indices' for Q1 2007 - May 24, 2007

Biopact: US tops Biofuels Country Attractiveness Indices for Q2 2007 - September 18, 2007

Biopact: Philippines in cooperation agreement with India's Praj Industries to develop biofuel sector - October 05, 2007

Biopact: Toyo Engineering eyes 600,000 hectares for coconut production in the Philippines - September 05, 2007

Biopact: Brazil and the Philippines to intensify cooperation on biofuels - August 31, 2007

Biopact: E-cane Fuel to invest US$150 million in ethanol plant in the Philippines - May 28, 2007

Biopact: Philippines in US$1.3 billion biofuel project with UK's NRG - May 23, 2007

Biopact: Philippine and Chinese company team up to build $ 30 million cassava ethanol plant in Sarangani - October 29, 2007

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Cereplast announces largest bioplastics facility in the world: 500 million pounds added

Cereplast, Inc., a manufacturer of bio-based, sustainable plastics, announces the location of a new facility that will add half a billion pounds (226.8 million kg) a year to its bioplastic resin production capacity when the site is fully developed by early 2010. This will make it the world's largest manufacturing plant of renewable biopolymers which cut oil consumption. Operations will start at the site in January of 2008.

After a long search we decided to settle down in Indiana for this project, in the heart of the Midwest, where we have easy access to our raw materials allowing us to reduce the carbon footprint of our operations by reducing transportation lines. - Frederic Scheer, CEO and President of Cereplast.

As the bioplastics sector grows, manufacturers find a need for flexible manufacturing solutions - a good location close to the required biomass source - that allows them to meet both the current and future demand. For Cereplast, the new Indiana facility allows the company to expand capacity immediately, and will enable it to keep pace with future growth. Rail service will help accommodate the enormous quantities of raw materials and finished goods that will move through the complex.

Cereplast says it has seen a positive response to the introduction of its 'Hybrid Resins'. It believes they will become mainstream plastics. This is due to the fact that the resins have nearly the same physical characteristics and price points as traditional polyolefins while plastics manufacturers can process the bio-based resins on conventional equipment. Because the bio-based resins contain less petroleum products, they are less susceptible to volatility in oil prices and this stability and transparency of future pricing has proven attractive to customers.

The resins can be processed at the same cycle time as traditional plastics, but require less energy in the production process by using significantly lower machine temperatures. All the company's biopolymers are treated with nanoparticles to impart significant structural and thermo-resistance characteristics.

Interest in the company’s newest product line, including Biopropolyene - the world’s first sustainable polypropylene - has been high, it says. Biopropylene replaces 50 percent or more of the petroleum-based content of conventional plastic resins with renewable resources such as cornstarch, tapioca (cassava) or other starches.

The company’s other product family, Cereplast Compostables resins, are nearly 100 percent bio-based, and are fully biodegradable and compostable meeting BPI (Biodegradable Products Institute) standards for compostability (ASTM 6400 D99 and ASTM 6868), and European Bioplastics standards (EN 13432). The products made from the bio-based resins break down in 60 to 180 days when placed in an industrial compost facility (schematic, click to enlarge). Composting is a natural process that allows greenhouse gas emissions – carbon dioxide – to sequestrate in soil instead of being released into the atmosphere:
energy :: sustainability :: bioenergy :: biomass :: oil :: bioplastic :: biopolymer :: polylactic acid :: renewable :: carbon emissions :: biodegradable :: bioeconomy ::

Within weeks, Cereplast will begin operations at a new logistics processing center, allowing the company to better serve clients in the Midwest and the East Coast. To get the new facility up and runing, it will begin hiring managers, supervisors, extrusion operators, warehouse specialists and maintenance technicians in early 2008. When the site reaches full capacity in early 2010, it will employ up to 200 full-time staff and be the world’s largest bio-plastic resin production facility.

Production will start in an existing industrial building that is situated in Seymour, Indiana on more than 12 acres. Cereplast is planning to have additional buildings completed by early 2009. Rail service will help accommodate the enormous quantities of raw materials and finished goods that will move through the complex.


Cereplast's bio-based, sustainable plastics are used as substitutes for petroleum-based plastics in all major converting processes – such as injection molding, thermoforming, blow molding and extrusions – at a pricing structure that is competitive with petroleum-based plastics.

References:
Cereplast: Cereplast Expands Bio-Plastic Production with a New, Half-Billion Pound Capacity Indiana Facility - December 9, 2007.

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Breakthrough on climate change reached in Bali, as U.S. makes U-turn

187 countries meeting in Bali on Saturday agreed to launch negotiations towards a crucial and strengthened international climate change deal. A compromise was reached on a 'Bali roadmap' that does not set the mandatory targets for emissions cuts (25-40% by 2020) as demanded by the EU and the G77, but calls for them, while not denying the need for efforts by major developing countries like China either, as demanded the US and others.

The decision includes a clear agenda for the key issues to be negotiated up to 2009. These are: action for adapting to the negative consequences of climate change, such as droughts and floods; ways to reduce greenhouse gas emissions; ways to widely deploy climate-friendly technologies and financing both adaptation and mitigation measures.

Concluding negotiations in 2009 will ensure that the new deal can enter into force by 2013, following the expiry of the first phase of the Kyoto Protocol.

We now have a Bali roadmap, we have an agenda and we have a deadline. But we also have a huge task ahead of us and time to reach agreement is extremely short, so we need to move quickly. - Rachmat Witoelar, Indonesian Environment Minister and President of the conference

Earlier this year, the UN’s Intergovernmental Panel on Climate Change (IPCC) issued a finding that if left unchecked, the world’s average temperature could rise by as much as 6 degrees centigrade by the end of the century, causing serious harm to economies, societies and ecosystems worldwide.

This is a real breakthrough, a real opportunity for the international community to successfully fight climate change. Parties have recognised the urgency of action on climate change and have now provided the political response to what scientists have been telling us is needed. - Yvo de Boer, Executive Secretary of the United Nations Framework Convention on Climate Change

The US brought the breakthrough just minutes after it had signalled it would reject the compromise.

The United States is very committed to this effort and just wants to really ensure we all act together. We will go forward and join consensus. - Paula Dobriansky, Chief U.S. negotiator

European delegates accepted the compromise but acknowledged the deal amounted to far less than the EU had wanted.

The public can understand that we brought the United States into the negotiations. It's a framework that is quite weak but which still moves forward. - Nathalie Kosciusko-Morizet, Deputy Ecology Minister of France

While a new global deal is envisioned for 2013, parties at the Bali Conference also agreed on a number of steps that need to be taken immediately to further implement the existing commitments of Parties to the United Nations Framework Convention on Climate Change (UNFCCC). These issues are particularly important for developing countries:
sustainability :: energy :: biomass :: bioenergy :: biofuels :: carbon capture and storage :: adaptation :: technology transfer :: REDD :: CDM :: IPCC :: UNFCCC :: climate change :: global warming :: Bali ::

Adaptation
Governments decided that funding for adaptation projects in developing countries, financed by the Kyoto Protocol’s clean development mechanism (CDM), would begin under the management of the Global Environment Facility (GEF). This ensures that the Adaptation Fund will become operational in an early stage of the first commitment period of the Kyoto Protocol (2008-2012).

The fund is filled by means of a 2% levy on CDM projects. Currently the fund is worth about €37 million. Considering the amount of CDM projects in the pipeline, this figure will rapidly increase to an estimated US$80-300 million in the period 2008-2012. The governments could not agree on additional practical adaptation measures, such as how to integrate adaptation into national policies. This issue will be on the agenda of the next meeting of the so called Subsidiary Body for Scientific and Technical Advice in Bonn in June of 2008.

Technology
The Bali Conference also made important progress on the issue of technology, one of the key concerns of developing countries. Governments agreed to kick start strategic programme to scale up the level of investment for the transfer of both the mitigation and adaptation technologies that developing countries need.

The aim of that programme is to give an extra push to concrete demonstration projects, to create more attractive environments for investment, as well as to provide incentives to the private sector for technology transfer. The GEF will start setting up this programme together with international financial institutions and representatives of the private financial sector.

Parties also agreed to extend the mandate of the Expert Group on Technology Transfer for a further five years. The Expert Group has been asked to pay particular attention to the assessment of gaps and barriers to the use of, and the access to, financing resources. Furthermore, the Expert Group will start working on performance indicators that can be used to regularly monitor and evaluate progress on the development, deployment and transfer of environmentally sound technologies.

The work of the Expert Group provides important input into the discussions on technology transfer for the new post-2012 climate change deal.

REDD
'Reducing emissions from deforestation in developing countries' (REDD) was a key issue at Bali. Parties affirmed the urgent need to take further meaningful action to reduce emissions from deforestation and forest degradation and adopted a work programme for further methodological work. That programme will focus, for example, on assessments of changes in forest cover and associated green house gas emissions, methods to demonstrate reductions of emissions from deforestation and the estimation of the amount of emission reductions from deforestation.

The decision furthermore encourages Parties to support capacity building and to undertake efforts, including demonstration activities, to address the drivers of deforestation. This is important to address the needs of local and indigenous communities who depend on forests for their livelihoods. Deforestation is regarded to be an important component of a future climate change regime beyond 2012 - in both mitigation and adaptation strategies.

IPCC
Parties agreed to recognize that the Fourth Assessment Report of the Intergovernmental Panel on Climate Change (IPCC) is the most comprehensive and authoritative assessment of climate change to date. The scientific findings will continue to inform the international climate change process.

CDM
Small-scale afforestation and reforestation: parties agreed to double the limit in size of small-scale afforestation/reforestation project activities to 16 kilotonnes of CO2 per year. This move will expand the number and geographical reach of the Clean Development Mechanism to countries that have thus far been unable to take part in the mechanism for this category of project activities.

Carbon capture and storage
Parties for the first time considered the possible inclusion of carbon capture and storage (CCS) in geological formations as CDM project activities. They agreed to do further work on this and established a workplan for 2008. The plan will include receiving and considering input on technical, legal, policy and financial topics associated with CCS.

This input will be considered at the next Climate Change Conference in Poznan next year. CCS is widely regarded as an important technology to enable the continued use of fossil fuels in a clean way.

CCS can be applied to biofuels (biohydrogen) and bioenergy, to yield 'negative emissions' fuels and energy.

Least developed countries
Parties agreed to extend the mandate of the Least Developed Countries (LDCs) Expert Group. This group provides critical advice to LDCs in assessments of adaptation needs. It is universally accepted that it is critical that LDCs are supported in assessing their adaptation needs because of their low adaptive capacity.


The conference was attended by around eleven thousand participants, among them the Secretary-General of the United Nations and six heads of state.

Four major UNFCCC meetings to implement the Bali roadmap are foreseen for next year, the first to be held in March or April.

References:
UN Framework Convention on Climate Change: UN Breakthrough on climate change reached in Bali - December 15, 2007.

UN Framework Convention on Climate Change: Decisions adopted by COP 13 and CMP 3 - December 15, 2007.

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