E2 report estimates advanced biofuel production through 2015

By Erin Voegele | September 11, 2012

A report recently published by Environmental Entrepreneurs (E2) shows that the biofuel industry is well-positioned to meet demand under California’s Low Carbon Fuel Standard. The LCFS requires a reduction of 10 percent of the carbon intensity of California’s transportation fuels by 2020 and provides an incentive to produce advanced biofuels.   

According to E2, programs like the LCFS and federal renewable fuel standard (RFS) create powerful incentives for investors and biofuel companies to continue to innovate and increase biofuel production, which will drive down costs and reduce carbon emissions. The report, titled “Advanced Biofuel Market Report 2012,” projects that at least 27 new or retrofitted advanced biorefineries will come online by 2015 to meet demand driven by the California LCFS and RFS. While biodiesel currently represents the bulk of advanced biofuel production in the U.S., other advanced and cellulosic fuels production facilities are poised to come online in the short-term.

E2’s report includes two methods for measuring production capacity for 2012 and 2015. The first method provides a low-end estimate, and is based on facilities that have substantive evidence of construction through associated financing, site selection, feedstock procurement, and other factors. These projects are considered to have a high probability of success. The second method provides a high-end estimate, and is based on based on publicly delivered projects by the companies themselves and represent capacity that could be achieved if regulatory certainty gave sufficient market certainty. According to E2, to come up with the high-end estimate it started with company projections and then used funding status, technology demonstration, partnerships and other factors to establish feasible numbers.

According to E2, it has identified 165 active advanced biofuel producers in the U.S. and Canada, including those pursuing the production of biobased jet fuel and those not currently in production, but that have plans to begin production by 2015. Of the 165 projects identified, 91 are biodiesel companies already in commercial production, with 74 other working to produce other types of advanced biofuels.

By 2015, E2 estimates that the low-end production level for biobased jet will be 23 MMgy, with a high-end capacity of 150 MMgy. For butanol, the organization estimates that annual production will increase to between 56 MMgy and 370.5 MMgy by 2015. Advanced ethanol production is expected to reach levels of 337.2 MMgy to 512.2 MMgy, with advanced biodiesel production reaching 877 MMgy, up from the current 2012 capacity of 564 MMgy. Drop-in diesel is expected to reach production levels of 248.4 MMgy to 300.8 MMgy. Drop-in gasoline production is expected to be lower, with between 52.4 MMgy and 113 MMgy online. Fuel flexible production capacity could reach levels between 11 MMgy and 312.6 MMgy. Finally, the production of biocrude is expected to reach levels of 1.1 MMgy by 2015.

Furthermore, the analysis noted that E2 expects 16 commercial-scale cellulosic ethanol plants to come online by 2015. The organization also expects five renewable diesel, two renewable gasoline, one biojet, one biocrude and two butanol facilities to come online by that time.

“What this report shows is that we have sufficient, proven technology to meet these new standards that will help clear our air, strengthen our economy and provide new choices in transportation fuels,” said Bob Epstein, co-founder of E2, the national group of business leaders who advocate for sound economic and environmental policies.

A full copy of the report can be downloaded from E2’s website