Can energy-dense intermediate products improve the cost-effectiveness for production of transportation fuels?

An increased share of renewable transportation fuels requires utilisation of new low-cost sources of bio-based raw materials other than what is currently used in the pulp and paper industry and for power and district heat generation in the bioenergy sector. In an expanding bioeconomy, these types of raw materials could typically include forest residues and by-products from pulp and paper industry and saw mills.

However, there are difficulties with handling these types of voluminous and heterogeneous raw materials in existing refineries. Also, the cost of transportation over long distances, e.g. to a larger production facility, is often described as high. By converting the raw material into an intermediate more homogeneous product with higher energy density could lower transportation costs and facilitate the final conversion into fuel.

These were the basic assumptions of a recently finished project within the collaborative research program Renewable transportation fuels and systems. The results however show that the original hypothesis of an intermediate product with high energy density reducing transportation costs could not be verified. The main reason is that a second transportation step for transporting the intermediate to the site of the final conversion has to be introduced, in addition to the transport of the raw material itself. In comparison with other items, however, transportation costs have a relatively small impact on the total cost of production. The project’s analysis of value chains also reported other effects, advantages and disadvantages, to converting forest biomass into an intermediate, more homogeneous product with a higher energy density. In sum, production costs are the most sensitive to scale effects, the oxygen content in bio-crude oil and raw material costs.

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