Sara Stefanini provides a written summary of our panel discussion held on Thursday March 17th 2022. It’s a full summary of the 90 minute discussion (including audience questions), but it begins conveniently with a summary of the highlights (potential for bioenergy, hard-to-abate sectors, sustainability, policy needs). Those highlights include the need to scale bioenergy up from around 50 EJ today to 150 EJ by 2050; the importance of carbon capture for industry decarbonisation; the implications for air travel ticket prices; the need for higher CO2 prices to incentivise investments; global harmonisation of standards. You can access the full video here. Taking part are Winston Beck, Head of Government Affairs, HeidelbergCement; Laurent Donceel, Senior Policy Director, Airlines for Europe; Ricardo Gorini. Senior Programme Officer, International Renewable Energy Agency (IRENA); Thomas Meth. Chief Commercial Officer, Enviva. [Event sponsor: Enviva]
- Winston Beck – Head of Government Affairs, HeidelbergCement
- Laurent Donceel – Senior Policy Director, Airlines for Europe
- Ricardo Gorini – Senior Programme Officer, International Renewable Energy Agency (IRENA)
- Thomas Meth – Chief Commercial Officer, Enviva
- Moderator: Matthew James – Managing Director, Energy Post
The potential for bioenergy
- To limit global warming to 1.5°C we need to scale bioenergy up from around 50 EJ today to 150 EJ by 2050.
- 150 EJ is the middle range of what’s possible within sustainability criteria.
- The use of biomass in industry needs to rise around four-fold from today to 2050, with bioenergy mainly providing process heat for cement, metal, chemicals, etc.
- The use of biofuels in transport needs to grow more than six-fold by 2050. Aviation will require around 200 billion litres per year of biojet fuel.
- Europe is the largest user of industrial wood pellets.
- The US capacity to fill the pulp and paper industry void is enormous, and it can grow to at least three times what we’re doing today. You see that trend elsewhere in the world.
- One-third of HeidelbergCement’s emissions are combustion-related and can be reduced by using biomass, as well as improved energy efficiency and renewable electricity.
- HeidelbergCement also requires carbon capture utilisation and storage to reduce process emissions, including the processing of limestone.
- Sustainable aviation fuels (SAF) are expected to cover 34% emission reductions for aviation between 2020 and 2030. This has an impact on demand because the price of SAFs will make flying more expensive.
- Enviva functions in symbiosis with the traditional forest product industry. If you harvest a tree, the first thing we have to maximise is continuous uninterrupted carbon storage in, for example, furniture products.
- For sustainable biomass, you have to grow more trees than you take out.
- Transport on a large ocean vessel from the US to Europe emits as much carbon as a truck going 200-300 km, on a per tonne basis. So transport emissions must be accounted for.
- To illustrate, if you replace coal with biomass in a lime kiln the carbon benefit is 89%, in a power plant it’s 80-85%.
- In the future, ships will run on biomass, which will further reduce emissions.
- Stronger CO2 price is needed to incentivise investments.
- A stronger carbon leakage system, for as long as there isn’t a global CO2 price.
- Landfill ban for waste, which will encourage its use as energy as well as a circular economy.
- Bioenergy with carbon capture and storage should be recognised under the EU Emissions Trading System or with a new carbon removal crediting scheme.
- Incentives are needed for carbon capture and storage or utilisation (CCUS), acknowledging the emission savings from plants and crediting them.
- Infrastructure for CCUS is also needed to avoid bottlenecks.
- “Fit for 55” proposals would introduce SAF-blended mandates at all European airports, from 2% in 2025 to 25% in 2035.
- But this raises potential risks. Do we have enough feedstock? What is the risk to land-use change? Will this distort competition? Where will the financing come from?
- The legislation needs to ensure you can find SAF in all corners of Europe. There are options: mass averaging, mass balancing, or guaranteeing the physical molecule of sustainable fuel at all airports.
- A global, uniform definition of sustainable biomass is needed. Definitions differ between the US and EU, and even within the EU.
Europe will not be able to reach net zero emissions by 2050 without a big contribution from bioenergy, accompanied by carbon capture and storage or utilisation technology.
Bioenergy already accounts for 60% of renewable energy in Europe, and 50% globally. Meeting the Paris Agreement’s goal of limiting the global temperature rise to 1.5°C will require the world’s bioenergy use to increase from around 50 exajoules today to 150 EJ by 2050, according to the International Renewable Energy Agency (IRENA).
This is particularly important for decarbonising hard-to-abate sectors including heavy industry, aviation, shipping and long-haul trucking. The global transport sector will need to see a six-fold increase in bioenergy use by 2050.
Bioenergy is a largely developed and mature technology. But increasing its supply and use requires policies that are both supportive of its increased development and strict on its sustainability – ensuring that the shift to bioenergy does not further degrade the land’s ability to sequester carbon.
Industries that need more bioenergy – including cement and aviation – are calling for a higher EU CO2 price to incentivise investments and, in the absence of a global carbon price, stricter carbon leakage rules. HeidelbergCement is also keen to see a European ban on landfill waste, which it says would encourage the use of waste for energy and support a circular economy.
Globally, industries are also calling for a uniform definition of sustainable bioenergy, to ensure that a sustainability certificate in one country applies worldwide. At the moment, criteria are different in the US and Europe, and also within the EU.
This is a summary, not a verbatim transcript, of the key points made during the online panel event.
Managing Director, Energy Post (moderator)
60% of renewable energy in Europe already comes from bioenergy, 50% is the global picture. Let’s start with the presentation from Ricardo Gorini.
Senior Programme Officer, International Renewable Energy Agency (IRENA)
Renewable energy is key to delivering the energy transformation we need to limit global warming to 1.5°C. IRENA produced a flagship report on global renewables, and bioenergy is key in that transformation.
Without biomass we can’t get to 1.5°C. We need to scale bioenergy up from around 50 EJ today to 150 EJ by 2050. That’s a massive effort. It’s a mix of solid biomass, biofuels and gas.
Sustainability is important, we don’t want to increase biomass without addressing its potential impact on the ecosystem. There is a lot of potential for sustainability. Our scenario of 150 EJ is in the middle range of what’s possible.
It’s not just the supply side that needs to transform and scale up, the end use also needs too. Industry, transport, buildings can all rely on bioenergy. Biofuels for aviation and shipping are key, and for chemicals feedstocks.
The use of biomass in industry needs to rise around four-fold from today to 2050. Bioenergy mainly provides process heat for industry, cement, metal, chemicals, etc.
The use of biofuels in transport needs to grow more than six-fold by 2050. It will be needed for aviation, with around 200 billion litres per year of biojet fuel. Our scenario also includes hydrogen and other solutions by 2050, but biofuels are critical.
In shipping, biodiesel and biomethanol are important.
Electrification will be key for road transport, but biofuels can be used for long-haul transport, including biomethane.
A lot of policies are still needed, globally and in Europe. We also need clear investment in supplies and upfront costs. If you really want to scale up bioenergy, we need to overcome barriers such as the lack of policy certainty and government coordination; high upfront and fuel costs; the lack of infrastructure for feedstock collection, transport, storage and pre-treatment; the lack of skilled workers; and the lack of awareness about bioenergy solutions and benefits.
Chief Commercial Officer, Enviva
We’re a producer of sustainable biomass in the form of wood pellets in the southeastern US. Most of it is exported to Asia and Europe. When I entered the biomass space 20 years ago, you had to figure out where to find the biomass and then find its use next to the source.
Given that most biomass has a moisture content of 50%, it’s difficult to transfer over long distances. That’s limiting, because the use and source of biomass are often far away from each other. This is the case in Canada, the Baltics, the Iberian Peninsula, Australian, New Zealand too.
We started in the power and heat sector, as utilities approached us for reliable biomass in larger quantities all year long, like a commodity. We found that the wood pellet form is the most cost effective to turn heterogeneous biomass that you find in the forest into something that’s homogenous, and transportable over long distances in a cost-effective and carbon-efficient way.
There’s this next frontier opportunity to scale biomass in hard-to-abate sectors like cement, steel, sugar, asphalt, and transportation, particularly in long-distance shipping and sustainable aviation fuels. We need to bring the biomass from where it’s available to the clusters of refineries.
10 to 13 years ago this industry started to develop, bridging the availability of biomass with the need for it. Europe is the largest user of industrial wood pellets. We’re using a lot more every year. The US uses less because it uses shale gas. China has a market for wood pellets, but it’s very domestic and not part of the global trend.
The US capacity to fill the pulp and paper industry void is enormous and has a lot of potential. We can take US production to at least three times what we’re doing today, and you see that trend elsewhere in the world.
Note that virtually all Russian volumes, which have been going to Europe, are stopped now for the foreseeable future.
When you talk about scale, you have to look at the forest resource. The US southeast is one of the largest wood baskets in the world. The forest land area is the total size of Germany, Spain and Italy combined. Those areas were afforested by private landowners to replace agriculture.
Not all biomass is equal, it needs to fit within the definitions of sustainable biomass. We function in symbiosis with the traditional forest product industry. If you harvest a tree, the first thing we have to maximise is carbon storage, for example in furniture products. We cannot just disrupt the equilibrium of forest use.
Head of Government Affairs, HeidelbergCement
HeidelbergCement is one of the largest manufacturers of construction material. Our core products are cement and aggregates, which are the two raw materials used for concrete. Concrete is in high demand, and it’s also the base for every wind turbine and hydro plant, so needed in the green transformation.
We were the first cement company to set a science-based climate target for 2030 and we aim to offer all our customers carbon-neutral concrete by 2050.
There are a variety of technologies and solutions. Around 60% of our emissions are unavoidable process emissions from the consummation of our main raw material, limestone. For that we need carbon capture utilisation and storage as well as a substitute for limestone.
But one-third of our emissions are combustion related, and here biomass and alternative fuels can make a big difference. The shift away from fossil fuels is key and part of our CO2 roadmap. As well as improving energy efficiency and switching to renewable electricity, we intend to use more alternative fuels such as biomass.
In 2019 alternative fuels accounted for around 25% of our global production, with biomass around 9%, and we aim by 2030 to get to 43% alternative fuels, with biomass around 19%. We only use waste-based biomass now, such as wood waste or waste from other industries.
At the moment we are usually restricted by market forces – prices – and we want to make sure any biomass we use is sustainable. We can already generate over 90% of thermal energy in kilns at our cement plants using alternative fuels, and we can use the residual ash that isn’t burned as a substitute for our primary raw material. It’s a circular economy solution.
We believe we need a strengthened CO2 price to make investments in these technologies even more attractive. At the same time we need an improved carbon leakage system, as long as we don’t have a global CO2 price. We support a landfill ban for waste. And biomass certification is key and needs to be implementable for our plant managers and suppliers.
We also need bioenergy with carbon capture and storage (BECCS). They need to be recognised either in the EU Emissions Trading System (ETS) or there needs to be a carbon removal crediting scheme.
Panel discussion + Q&A
What are the barriers that need to be overcome, or policy actions taken, to create the path for sustainable biomass to reach its potential?
The policy measures Winston listed came up in our survey, as did the idea of having some sectoral mandates for the scalability of transport.
– Audience Question from: Tiffany Cheung
Does Enviva plan to move into biochar production, as decarbonisation through offsetting is becoming increasingly interesting for hard-to-abate sectors?
When you think about the different avenues to further refine biomass, you end up with elements of biochar, liquid and gas, and depending on the further usage you can adjust the technology to maximise one or two of the three. We are not the technology supplier, but I wouldn’t rule it out.
All three form factors of further refinement from traditional biomass to liquid, gas and biochar see huge demand optics. So as an industry we will make further inroads into biochar, because it is a fantastic way to decarbonise some sectors.
We have looked into biochar, but it’s not part of our overall roadmap.
– Audience Question from: Jeffrey Douglass
How long does it take before that burned forested area returns to carbon neutrality?
Let’s look at the carbon benefits of biomass before its transportation. The UN IPCC decided about 20 years ago to count carbon for bioenergy at the forest, rather than [at the point of] usage which is too fragmented to count. Every year we count how much wood is taken out of forests and how much is replenished.
For sustainable biomass, you have to grow more trees than you take out. There’s a misconception that biomass involves felling lots of trees, but it’s a byproduct of [already felled] wood that does not have another use.
Transport in a large ocean vessel from the US to Europe emits as much carbon as a truck going 200-300 km, on a per tonne basis.
So if you replace coal in a lime kiln, the carbon benefit isn’t 100% because you have that transport, it’s 89%, and in a power plant it’s 80-85%. In the long term that’s not good enough, which is why we’ve committed to have net zero Scope 1 and 2 emissions by 2030.
Those ships will run on biofuels in the future. Maersk has ordered ships that will run on biomethanol from 2025.
– Audience Question from: François Issard
The use of wood for cooking in Africa is going to be a major problem for decarbonisation. Has IRENA thought about solutions, in terms of policy and technology?
For the cement industry, how can you escape the problem of capture and storage or utilisation in decarbonisation?
Efficient cooking stove technology exists, and there are renewable energy solutions including solar and LPG. Investment and finance is the key issue for policy. There is a way to bring this to the consumer, if governments and the private sector assist.
Carbon capture and storage or utilisation (CCUS) is a key technology, both for our process emissions and to capture residue emissions. The technology has been used by other industries over many years, mainly oil and gas.
We have several projects where we are trying to scale CCUS, and our project in Norway is closest to scale – we have installed the first industrial-scale CCS project at a cement plant in the world. It will go live in 2024, capturing 400,000 tonnes of CO2 and storing it underground. At another project in Sweden we’re aiming to store or use 1.8 million tonnes of CO2 by 2030, which would be the first climate-neutral cement plant in the world. Both projects have a high biomass content.
But we need to work on the political framework to make CCUS work in Europe. We need to acknowledge the emission savings and credit them, and we need the infrastructure for the CO2, otherwise there will be bottlenecks.
– Audience Question from: Fiona Matthews
What’s the feasibility of hitting your 19% biomass goal, and can you use that using local low-cost biomass?
That depends on the local situation, and it will depend case by case. There are a lot of materials available and we need to work together to use waste. We also need landfill bans and need to make sure the processing is more effective.
Cement has more flexibility in what kind of biomass producers can use compared to other industries. The requirements for lime or steel are much narrower, so local resources are likely not to be enough.
– Audience Question from: Ivan Quail
Ricardo, you gave a figure of 4.5 Gt of CO2 removed: is that counting the CH4 as 28 times worse than CO2 as far as global warming is concerned over 100 years? Or is it counting it as 84 times worse, over 20 years?
It’s a CO2-related calculation.
There is another question posted from the audience about there being 150 EJ of demand, but production of only 90 EJ. Ricardo, can you comment.
This is related to the difference between final energy consumption and the primary energy supply. Consumption on one side and supply on the other, including electricity generation.
Laurent Donceel from Airlines4Europe has now joined us – he had another commitment earlier. Laurent, can you give us your presentation.
Senior Policy Director, Airlines for Europe
The decarbonisation roadmap for European aviation foresees a mix of different measures – improved aircraft technology, air traffic management and more reliance on economic measures, including the ETS and CORSIA. This will cover the bulk of how we contribute to the European Green Deal and Fit for 55.
But between 2030 and 2050, the big contributor to decarbonisation is sustainable aviation fuels. That accounts for roughly 34% of our contribution to the EU Green Deal, and has an impact on demand because the price of sustainable aviation fuels will make flying more expensive.
Between now and 2050 the use of drop-in fuels blended with kerosene allows us to mitigate around 100 million tonnes of CO2. That’s massive compared to where we are now.
In the short term these fuels will be bio-based, in the future they will be synthetic.
There are a number of proposals under “Fit for 55” that put in SAF-blended mandates at all European airports, starting at 2% in 2025 going up to 25% in 2035. Do we have enough feedstock? What is the risk to land-use change? Is there a risk of distortion of competition? Where will the financing come from?
We have seen a dramatic uptick in interest for biomass supply in SAF over the last six to 12 months. There is urgency behind it, but the business model is still unclear, as are the roles of different players. There are several steps between getting biomass and putting it in an aeroplane, and there are byproducts. Are you going to go to the source in the forest and ship your product, or will you go closer to the refinery?
There is a tendency to want to be closer to the refinery, which speaks to the transportability of biomass to the refinery. We’ll probably see both business models, so the jury is still out.
That leads to concerns we have about the integrity of the single market. We know that biomass can’t be found in every corner of Europe, yet we are a global business. Distortion of competition can be high if you have more biomass in Northern Europe than, say, Cyprus.
The legislation needs to ensure you can find SAF in all corners of Europe, then you have options – mass averaging, mass balancing, or guarantee that you will have the physical molecules of sustainable fuel at all airports, whether small or big.
We know that the aviation sector, at least for long haul flights, has no alternative to liquid fuels.
Why can’t your expected share of SAF be higher than 34% between 2030 and 2050? What are the barriers?
There’s the technical challenge – will we be able to access the feedstock for these fuels? Will there be enough capacity to uptake these fuels without jeopardising connectivity? Certain routes will be unaffordable or certain people will be priced out. That’s why we need this balance of measures.
Today, the US definition of a sustainable aviation fuel under the Environmental Protection Agency is different from what the EU’s Renewable Energy Directive (RED) II says, and EU countries could add different definitions to RED II. It creates a mess if every country has a different definition of sustainability. That’s important for biomass because the use of biomass is not limited to one country.
RED II allows countries to tighten the standard, which is a problem because an industry can choose to decarbonise and produce in a less strict country.
RED II is implemented differently in EU member states, which means we need to adapt our plants even though they are stationary. It would be good to have some harmonisation and certainty that rules won’t be revised every few years.
This is essential for us, considering that we now have a blending mandate for sustainable fuels, to have a regulation under the mandate. With different eligibility criteria, different types of SAF and different prices, the temptation to choose different destinations is very high. There’s a role for policymakers to harmonise.
Final thoughts from everyone?
What’s essential for us is creating trust in the sector. There are very big expectations on the aviation sector to align with the Paris Agreement, but it’s important that we create trust also from our end with passengers who will be asked to pay higher prices for tickets.
The EU discussions in coming months will be essential – what are the unintended consequences we consider acceptable and unacceptable?
Now it’s about implementing technologies and scaling them, and it’s about speed. Some of these big projects have lead times of five to eight years, so we need to have financial investment decisions within the next two or three years.
When it comes to policies, a CO2 price is a good driver but we need carbon leakage protection and compensation or funding to de-risk these projects, and we support landfill bans.
– Audience Question from: Du Jen
Are you aware of any existing landfill bans?
Not across Europe, but there are many in different jurisdictions. We’re in favour of an EU-level ban.
Maximising local biomass is absolutely key, and what we do [at Enviva] is supplement local biomass. We create security and incremental supply. Local biomass and the global commodity don’t compete, they go together.
Biomass can be scaled dramatically from where we are today. We don’t have another choice but to focus on applications that don’t have another choice – like transatlantic flights or a blast furnace – and maximise efficiency.
The IPCC’s four pathways to 1.5°C or 2°C all require negative emissions, and bioenergy carbon capture and storage is an option.
Summary compiled by Sara Stefanini
Produced by Energy Post