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    Spanish company Ferry Group is to invest €42/US$55.2 million in a project for the production of biomass fuel pellets in Bulgaria. The 3-year project consists of establishing plantations of paulownia trees near the city of Tran. Paulownia is a fast-growing tree used for the commercial production of fuel pellets. Dnevnik - Feb. 20, 2007.

    Hungary's BHD Hõerõmû Zrt. is to build a 35 billion Forint (€138/US$182 million) commercial biomass-fired power plant with a maximum output of 49.9 MW in Szerencs (northeast Hungary). Portfolio.hu - Feb. 20, 2007.

    Tonight at 9pm, BBC Two will be showing a program on geo-engineering techniques to 'save' the planet from global warming. Five of the world's top scientists propose five radical scientific inventions which could stop climate change dead in its tracks. The ideas include: a giant sunshade in space to filter out the sun's rays and help cool us down; forests of artificial trees that would breath in carbon dioxide and stop the green house effect and a fleet futuristic yachts that will shoot salt water into the clouds thickening them and cooling the planet. BBC News - Feb. 19, 2007.

    Archer Daniels Midland, the largest U.S. ethanol producer, is planning to open a biodiesel plant in Indonesia with Wilmar International Ltd. this year and a wholly owned biodiesel plant in Brazil before July, the Wall Street Journal reported on Thursday. The Brazil plant is expected to be the nation's largest, the paper said. Worldwide, the company projects a fourfold rise in biodiesel production over the next five years. ADM was not immediately available to comment. Reuters - Feb. 16, 2007.

    Finnish engineering firm Pöyry Oyj has been awarded contracts by San Carlos Bioenergy Inc. to provide services for the first bioethanol plant in the Philippines. The aggregate contract value is EUR 10 million. The plant is to be build in the Province of San Carlos on the north-eastern tip of Negros Island. The plant is expected to deliver 120,000 liters/day of bioethanol and 4 MW of excess power to the grid. Kauppalehti Online - Feb. 15, 2007.

    In order to reduce fuel costs, a Mukono-based flower farm which exports to Europe, is building its own biodiesel plant, based on using Jatropha curcas seeds. It estimates the fuel will cut production costs by up to 20%. New Vision (Kampala, Uganda) - Feb. 12, 2007.

    The Tokyo Metropolitan Government has decided to use 10% biodiesel in its fleet of public buses. The world's largest city is served by the Toei Bus System, which is used by some 570,000 people daily. Digital World Tokyo - Feb. 12, 2007.

    Fearing lack of electricity supply in South Africa and a price tag on CO2, WSP Group SA is investing in a biomass power plant that will replace coal in the Letaba Citrus juicing plant which is located in Tzaneen. Mining Weekly - Feb. 8, 2007.

    In what it calls an important addition to its global R&D capabilities, Archer Daniels Midland (ADM) is to build a new bioenergy research center in Hamburg, Germany. World Grain - Feb. 5, 2007.

    EthaBlog's Henrique Oliveira interviews leading Brazilian biofuels consultant Marcelo Coelho who offers insights into the (foreign) investment dynamics in the sector, the history of Brazilian ethanol and the relationship between oil price trends and biofuels. EthaBlog - Feb. 2, 2007.

    The government of Taiwan has announced its renewable energy target: 12% of all energy should come from renewables by 2020. The plan is expected to revitalise Taiwan's agricultural sector and to boost its nascent biomass industry. China Post - Feb. 2, 2007.

    Production at Cantarell, the world's second biggest oil field, declined by 500,000 barrels or 25% last year. This virtual collapse is unfolding much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos. Wall Street Journal - Jan. 30, 2007.

    Dubai-based and AIM listed Teejori Ltd. has entered into an agreement to invest €6 million to acquire a 16.7% interest in Bekon, which developed two proprietary technologies enabling dry-fermentation of biomass. Both technologies allow it to design, establish and operate biogas plants in a highly efficient way. Dry-Fermentation offers significant advantages to the existing widely used wet fermentation process of converting biomass to biogas. Ame Info - Jan. 22, 2007.

    Hindustan Petroleum Corporation Limited is to build a biofuel production plant in the tribal belt of Banswara, Rajasthan, India. The petroleum company has acquired 20,000 hectares of low value land in the district, which it plans to commit to growing jatropha and other biofuel crops. The company's chairman said HPCL was also looking for similar wasteland in the state of Chhattisgarh. Zee News - Jan. 15, 2007.

    The Zimbabwean national police begins planting jatropha for a pilot project that must result in a daily production of 1000 liters of biodiesel. The Herald (Harare), Via AllAfrica - Jan. 12, 2007.

    In order to meet its Kyoto obligations and to cut dependence on oil, Japan has started importing biofuels from Brazil and elsewhere. And even though the country has limited local bioenergy potential, its Agriculture Ministry will begin a search for natural resources, including farm products and their residues, that can be used to make biofuels in Japan. To this end, studies will be conducted at 900 locations nationwide over a three-year period. The Japan Times - Jan. 12, 2007.

    Chrysler's chief economist Van Jolissaint has launched an arrogant attack on "quasi-hysterical Europeans" and their attitudes to global warming, calling the Stern Review 'dubious'. The remarks illustrate the yawning gap between opinions on climate change among Europeans and Americans, but they also strengthen the view that announcements by US car makers and legislators about the development of green vehicles are nothing more than window dressing. Today, the EU announced its comprehensive energy policy for the 21st century, with climate change at the center of it. BBC News - Jan. 10, 2007.

    The new Canadian government is investing $840,000 into BioMatera Inc. a biotech company that develops industrial biopolymers (such as PHA) that have wide-scale applications in the plastics, farmaceutical and cosmetics industries. Plant-based biopolymers such as PHA are biodegradable and renewable. Government of Canada - Jan. 9, 2007.


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Monday, January 08, 2007

European dependence on Russian energy fully exposed, once again

Those who thought 'energy security' and 'energy dependency' were empty buzz-words, must think again. What many had expected has happened: the dispute between Russia and Belarus over gas prices has escalated and now hits oil supplies to Europe.

A quick overview of the facts:
  • Late december: Gazprom announces that it is raising gas prices for Belarus from US$47 per 1000m³ to US$105; if Belarus does not accept the new price, gas supplies will be cut off from January 1 onwards.
  • Last-ditch talks result an agreement on Dec. 31, when Belarus accepts a price of US$100, but Belarussian president Lukashenko immediately announces retaliation
  • Belarus is not in a strong economic or political position and uses the instrument of oil-transit taxes to punish Russia; on each ton of Russian oil that transits through Belarussian pipelines to Europe, a US$45 tax is imposed
  • Russia refuses to pay the tax it deems to be illegal, upon which Belarus starts to siphon off oil as payment in kind for the duties
  • Yesterday and today: Transneft, the state-run Russian pipeline monopoly, cuts off oil supplies to Belarus and therefor to Europe, and annouces it is working to find alternative routes; the cuts mainly affect Germany and Poland
  • Germany and Poland study whether they must start tapping their strategic reserves, worth between 80 and 100 days of oil consumption
This entire episode once again shows how unreliable Russia and the former Soviet Republics are as energy suppliers. A diplomatic call by the European Commission to 'resolve the dispute as quickly as possible' does not hide the structural problem of heavy dependency and the risk of supply disruptions. Last year, in a similar row, Russia cut off gas supplies to the Ukraine, which affected Europe too.

The growth of the European energy dependency rate does not promise anything good for the future. It can be summarised as follows:
  • Oil: 22% of EU oil imports originate from Russia; 45% originate from the the Middle East; by 2030, 90% of EU oil consumption will have to be covered by imports
  • Gas: 40% of EU gas imports originate from Russia (30% Algeria, 25% Norway); By 2030, over 60% of EU gas imports are expected to come from Russia with overall external dependency expected to reach 80%.
  • Coal: By 2030, 66% of EU needs is expected to be covered by imports.
In the short term, there is not much the EU can do to increase its energy security or to lessen its dependency on foreign energy. But in the long run, several options are available. At the Biopact, we think diversifying into biomass and biofuels imports from the South is one of the most feasible, large-scale strategies available. Biomass can substitute all fossil energy sources (solid, gaseous and liquid) and, unlike other renewables, can be transported around the globe. Moreover, when produced in the South, biomass competes with fossil fuels.

No doubt the Belarus-Russia gas dispute, which has now turned into a real theat to European energy security, will dominate the headlines over the coming days. We will be tracking this story closely and look at how it changes European public opinion on energy supply strategies.
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Nigeria's renewables industry to generate 500,000 jobs

One of the strongest arguments in favor of developing biofuels and renewables in the Global South is the potential to generate much needed jobs and spill-over effects into other sectors. Earlier we pointed to government estimates on how much employment Brazil's new ethanol plans will bring (3.6 million by 2010 - earlier post), and we looked at Indonesia's large bioenergy investments from this perspective as well (2.5 million jobs by 2010 - earlier post). Bioenergy has the potential to bring social and economic development to rural areas in the South.

Energy experts and stakeholders from West-Africa yesterday assessed Nigeria's Renewable Energy Master-plan (REMP) and came to the same conclusion. A draft of this plan was submitted to government in 2005, but has been reworked since. At the audit, National Coordinator of the Council of Renewable Energy in Nigeria, Odigha Odiagha, predicted that exploitation of the country's renewable energy potential could create avenues for mass employment.

The main points of the draft REMP can be summarized as follows:
  • power generation target: 2,945MW of wind, solar PV, solar thermal, small hydro and biomass to be installed by 2025, roughly an equivalent to the entire capacity used in Nigeria today.
  • accent on decentralisation: renewable energy technologies do not have to be connected to a large grid, thus can be cost-effective choices for expedient rural electrification.
  • estimate of jobs to be generated under the plan: 500,000 jobs in the next 10 years.
  • new models and policies to enhance cooperation of government, private sector and civil society organisations.
  • development of a frameworked for power sales from small-scale renewable energy producers to the national grid.
The development of a liquid biofuels program has been treated separately and falls under agro-industrial plans (such as the Presidential Cassava Plan). It involves investments in large-scale sugarcane and oil palm plantations, as well as in cassava. This plan is estimated to bring 3 million jobs to the rural poor (earlier post).

The Renewable Energy Master-plan entails an ambitious but achievable commitment to the development of all major renewable energy resources, and includes short, medium and long term targets, planned activities and milestones and strategies for implementation of this comprehensive renewable energy development strategy. The development of the sector in Nigeria as a major strategy that would not only conserve the nation's oil reserves, but would also develop the economy and alleviate poverty:
"Developing, manufacturing, building, installing, and maintaining renewable energy technologies has the potential to create many new Nigerian-lead jobs and powerful modern industries. This will serve to empower entrepreneurs and companies to help build a vibrant and diverse economy. It is also a wise economic choice for the long term. As fossil fuels deplete, Nigeria will have diverse, dependable energy sources and be able to strategically benefit from our oil resources". -- Odigha Odiagha, National Coordinator of the Council of Renewable Energy, Nigeria
Odigha said renewable energy is part of the solution to conserving far more resources than just oil. 50% of Nigeria's current energy consumption comes from primitively used wood fuel and charcoal. Its replacement by modern bioenergy and other renewables will ease the burden on the health and time of Nigeria's women and children, conserve forests and contribute to cleaner and better environment for Nigerians to live in:
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Renewable energy technologies utilise energy from small-scale hydro, wind, solar, geo-thermal, biomass, biogas, and biofuels which Nigeria has in abundance. The energy development expert said apart from the potential to generate about 500,000 jobs in the next 10 years, exploiting energy from renewable sources like solar, wind and hydro-dams can contribute to a stronger economy, and in addressing the estimated $1billion a year, which Nigerian businesses lose due to an unstable power supply.

According to the coordinator, a developed renewable energy sector would also engender a healthier, cleaner nation, which would be powered by energy from inexhaustible sources.

Not only do they provide clean, stable means of energy generation, the large scale implementation of renewable energy makes economic sense for Nigeria both in the short term and the long term, he said.

Regional integration
Being central to the economic development of West Africa region, EOWAS Director for Infrastructure and Industry, David Kamara, had asked Africa's most populous country to broaden the master plan to incorporate the sub-region.

He asked countries in the region to shift from "stand-alone" technology initiatives which slowed development and progress.

"If the Nigeria Renewable Master Plan is to enlarge and accommodate other countries within the region it will become more attractive and of advantage for ECOWAS," Kamara said.

The production of renewable energy will undoubtedly alleviate the problems of waste management African countries are faced with.


More information:

This Day (Lagos): Nigeria: 500,000 Jobs Expected From Renewable Energy, Jan. 8, 2006
Afrol News:Gambia to produce renewable energy, Jan. 5, 2006

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Syngenta and Diversa create partnership to discover enzymes for second-generation biofuels

Syngenta and Diversa Corporation announced today a new 10-year research and development partnership focused on the discovery and development of a range of novel enzymes to convert pre-treated cellulosic biomass economically to mixed sugars – a critical step in the process of 'second generation' ethanol production.

The new agreement allows Diversa to independently develop and commercialize fermentation-based enzyme combinations from its proprietary platform. Syngenta will have exclusive access to enzymes from Diversa’s platform to express in plants for enhanced cost-effective production.

Converting ligno-cellulosic biomass to biofuels requires breakthrough developments in three areas:
  1. chemical preparation of the cellulosic biomass (pre-treatment)
  2. conversion of pre-treated cellulosic biomass to fermentable sugars by combinations of enzymes (saccharification)
  3. the development of novel micro-organisms to ferment the sugars to ethanol or other fuels (fermentation)
Developing cost-effective enzyme systems is essential to economically converting biomass to biofuels:
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Under the terms of the new agreement, which replaces the companies’ prior agreement, Syngenta will pay Diversa €12.3/US$16 million of guaranteed research funding in the first two years. Diversa is eligible to receive certain milestone and royalty payments aligned to product development success:

Previous breakthrough
As one result of their earlier partnership, Syngenta, a global agribusiness and third in the high-value commercial seeds market, is developing a genetically modified strain of corn that expresses high levels of alpha amylase—a thermal-tolerant digestive enzyme developed by Diversa that turns the corn’s starch into sugar for ethanol.The engineered plants are designed to reduce costs by eliminating the need for mills to add liquid enzymes. The Amylase-T seeds do not increase the yield, rather they make corn easier to process.

Amylase is a digestive enzyme (present in saliva, for example) that breaks down long-chain carbohydrates (such as starch) as an initial step in the production of ethanol from grain starch.

Very broadly, in this type of production, corn or starchy grain is ground into flour (“meal”), which is then slurried with water to form a mash. Enzymes are added for the conversion of starch to sugar, the whole mash is processed in a high-temperature cooker and then transferred to fermenters where yeast is added and the conversion of sugar to ethanol and CO2 begins.

The starch is usually heated at around 105°C or higher in the presence of thermostable alpha amylase, and then liquefied further at a lower temperature (around 90ºC). The high temperatures help reduce bacteria levels in the mash (high bacteria levels reduce yield).

Another key factor in the outcome of the process besides temperature is pH.

The pH is a measure of the acidity or alkalinity of a solution expressed on a scale of 1-14. Neutral is pH 7, pH 1-7 is acid, and pH 7-14 is alkaline. Yeast will grow only in a slightly acid solution (and the growth of harmful bacteria is further retarded by the slight acidity).

Conventional alpha-amylase enzymes, however, function best in a slightly alkaline environment.

As a result, ethanol producers spend time and material managing the pH of the mash to optimize the different stages of the process. And as a further result, producers have been seeking an enzyme that works well in a lower pH environment for years. As late as 2000, low pH-high temperature amylases were one of the top research requests from the industry.

The new Diversa research “Ultra-Thin” enzyme appears to meet that need. Capable of operating robustly at pH 4.5—the same pH of the production process—it reduces the cost associated with managing the mash pH.

Picture: modified Amylase enzyme.

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