Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Congressional research reportOct 22, 2010
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Cellulosic Ethanol: Feedstocks, Conversion
Technologies, Economics, and Policy Options
(name redacted), Coordinator
Specialist in Agricultural Policy
October 22, 2010
Congressional Research Service
7-....
www.crs.gov
R41460
CRS Report for Congress
Prepared for Members and Committees of Congress
Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Summary
In the Energy Independence and Security Act of 2007 (P.L. 110-140), Congress mandated the use
of a large and rapidly increasing volume of biofuels as part of the U.S. national transportation fuel
base. In particular, the share of cellulosic biofuels is mandated to grow to 16 billion gallons by
2022—a daunting challenge considering that no commercial production existed as of mid-2010.
Cellulosic biofuels can be produced from almost any sort of biomass. As a result, a variety of
biomass types that can be produced or collected under a range of geographic settings are potential
feedstock sources. However, part of the mandate’s challenge will be encouraging farmers to
produce or collect non-traditional biomass materials that require multiple growing seasons to
become established, and for which markets currently do not exist. Participation represents a
substantial risk for producers, and even under the most optimistic conditions, U.S. agriculture will
be challenged to produce the enormous volume of biomass needed to meet the biofuels mandate.
Potential biomass feedstocks are numerous and widespread throughout the United States, and
include woody biomass, perennial grasses, and agricultural and forest residues. Each type of
biomass faces tradeoffs in terms of production, storage, and transportation. Dedicated energy and
tree crops have large up-front establishment costs and will likely take several years to produce a
commercial harvest, but can produce high yields with relatively low maintenance costs thereafter.
Residues are nearly costless to produce, but confront difficult collection strategies and do not
always produce uniform biomass for processing. Agricultural residues face complicated trade-offs
between soil nutrient loss and biomass yield, as well as questions about the optimal timing
strategy for harvesting the main crop and residue (either jointly or separately). Logging residues
confront a tradeoff with energy production at the plant (via burning).
None of the potential feedstocks (other than starch from corn) are economical to convert into
biofuels under current commercial technology without substantial federal policy intervention. In
addition to federal policy and the choice of feedstock, the processing technology used, the
distribution infrastructure, and blending rates are expected to play major roles in the economic
viability of cellulosic biofuels. Different processing technologies yield different biofuels in terms
of energy content and usability, while also strongly influencing the economic viability of biofuels
production. Ethanol produced under current biochemical processes yields only 67% of the energy
of an equivalent volume of gasoline, and (due to its chemical properties) cannot use the same
storage tanks, pipelines, and retail pumps as gasoline. In contrast, synthetic petroleum products
(i.e., green hydrocarbons) obtained from biomass processed using more costly thermochemical
technology yield an energy content nearly equal to petroleum fuels and can be used in existing
fuel infrastructure. Currently ethanol is blended in most gasoline at about a 10% rate. If the rising
usage mandate is to be met, the biofuels blending rate will necessarily have to increase, at which
point the energy equivalence of a biofuel will likely influence the choice of processing
technology, distribution infrastructure, and federal policy incentives.
Many uncertainties remain concerning biomass producer participation rates, the choice of
biomass, and associated yields and costs of production, harvest, storage, and transportation, as
well as contractual marketing arrangements, plant location, and conversion technology, among
other issues. This report attempts to summarize the current state of knowledge regarding potential
biomass feedstocks, production and marketing constraints, processing technologies, and the
economics of biomass from field to fuel under current and hypothetical policy circumstances. As
such, it is intended to serve as a reference for policymakers interested in understanding the
complexity underlying the development of a large-scale, biomass-based fuel system.
An executive summary of the report is available in Chapter 1.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Contents
Introduction ................................................................................................................................1
Structure of the Report ................................................................................................................2
Other CRS Reports on Cellulosic Biofuels ..................................................................................2
Report Authorship.......................................................................................................................3
Chapter 1: Executive Summary ................................................................................................... 4
Cellulosic Biofuels................................................................................................................4
The Choice of Feedstock.......................................................................................................4
The Choice of Processing Technology ...................................................................................6
Biochemical Conversion .................................................................................................6
Thermochemical Conversion...........................................................................................7
Commercialization Status......................................................................................................7
Economic Comparison of Biomass, Processing Technology, and Policy Choices ...................8
Chapter 2: Introduction ...............................................................................................................9
Chapter 3: Lignocellulosic Feedstocks ...................................................................................... 11
Feedstock Types.................................................................................................................. 11
Dedicated Energy Crops................................................................................................ 13
Agricultural Residues.................................................................................................... 15
Dedicated Tree Crops.................................................................................................... 17
Forest Residues ............................................................................................................. 18
Potential Biomass Supply.................................................................................................... 19
Feedstock Production Yields ............................................................................................... 22
Production Costs ................................................................................................................. 27
Two Alternate Cost Studies From 2009................................................................................ 34
Idaho National Laboratory Monte Carlo Simulation Results .......................................... 34
National Academy of Sciences Feedstock Costs ............................................................ 35
Supply Logistics ................................................................................................................. 38
Low Energy Density Concerns ...................................................................................... 38
Harvest Timing Concerns .............................................................................................. 39
Storage Concerns .......................................................................................................... 39
Moisture Content Concerns ........................................................................................... 41
Quality Uniformity Concerns ........................................................................................ 41
Conclusions ........................................................................................................................ 42
Chapter 4: Cellulosic Biofuel Conversion Technologies............................................................. 43
Biochemical Conversion ..................................................................................................... 43
Pretreatment.................................................................................................................. 44
Hydrolysis .................................................................................................................... 45
Fermentation................................................................................................................. 45
Distillation .................................................................................................................... 46
Use of Lignin................................................................................................................ 46
Improvements ............................................................................................................... 46
Thermochemical Conversion............................................................................................... 46
Gasification and Fischer-Tropsch Synthesis................................................................... 47
Pyrolysis ....................................................................................................................... 48
Improvements ............................................................................................................... 48
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Energy Yield ....................................................................................................................... 48
Estimated Cost per Gallon................................................................................................... 49
Current Plants ..................................................................................................................... 51
Other Technologies ............................................................................................................. 53
Conclusions ........................................................................................................................ 54
Chapter 5: Economics and Policy of Cellulosic Biofuels............................................................ 55
Introduction ........................................................................................................................ 55
Blend Wall .......................................................................................................................... 57
Renewable Fuel Standard.................................................................................................... 61
Biomass Crop Assistance Program ...................................................................................... 64
Fixed Subsidies................................................................................................................... 64
Variable Subsidies............................................................................................................... 65
Analytical Comparison of Fixed and Variable Tax Credits ................................................... 66
Note on Volumetric Pricing (VP) versus Energy-Equivalent Pricing (EEP) .................... 66
Breakeven Oil Prices..................................................................................................... 68
Profitability Results: Deterministic Case ....................................................................... 69
Profitability Results: Stochastic Case ............................................................................ 70
Conclusions ........................................................................................................................ 74
Figures
Figure 1. Cellulosic Ethanol Supply Chain ..................................................................................9
Figure 2. Composition of Lignocellulosic Feedstocks by Type................................................... 13
Figure 3. Expected Types of Biomass by Geographic Region in the US ..................................... 19
Figure 4. Geographic Distribution of Biomass Resources in the United States ........................... 20
Figure 5. Projected U.S. Biofuel Sources................................................................................... 21
Figure 6. Biochemical Conversion Process ................................................................................ 43
Figure 7. Simplified Impact of Pretreatment on Biomass ........................................................... 44
Figure 8. Thermochemical Conversion Process via Gasification ................................................ 47
Figure 9. Thermochemical Conversion Process via Pyrolysis..................................................... 48
Figure 10. U.S. Ethanol Production from 1980 to 2010.............................................................. 56
Figure 11. Historic Ethanol and Gasoline Price Differences ....................................................... 56
Figure 12. U.S. Ethanol Consumption and the 10% Blend Wall ................................................. 58
Figure 13. Ethanol Subsidies and the Blend Wall....................................................................... 60
Figure 14. U.S. Renewable Fuel Standard (RFS) Mandates by Biofuel Type.............................. 61
Figure 15. Ethanol Subsidies and Non-Binding RFS.................................................................. 63
Figure 16. Ethanol Subsidies and Binding RFS.......................................................................... 63
Figure 17. Mean Oil Price Forecasts for Stochastic Simulations (2008 real dollars) ................... 68
Tables
Table 1. Estimated Composition of Lignocellulosic Feedstocks ................................................. 12
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Table 2. Biomass Yields by Feedstock ....................................................................................... 24
Table 3. Corn Stover Production Costs ...................................................................................... 27
Table 4. Assumptions and Parameters Used in Two Corn Stover Cost Studies ............................ 29
Table 5. Switchgrass Production Costs ...................................................................................... 31
Table 6. Miscanthus Production Costs ....................................................................................... 33
Table 7. Short-Rotation Woody Crop Production Costs.............................................................. 33
Table 8. Forest Residue Production Rates and Costs .................................................................. 34
Table 9. Conventional Non-Uniform Feedstock Production Costs ($/dry ton) ............................ 35
Table 10. Willingness-to-Accept Corn Stover Price per Ton....................................................... 36
Table 11. Willingness-to-Accept Switchgrass Price per Ton ....................................................... 36
Table 12. Willingness-to-Accept Miscanthus Price per Ton........................................................ 37
Table 13. Willingness-to-Accept Woody Biomass Price per Ton ................................................ 37
Table 14. Switchgrass Dry Matter Loss by Bale Type and Cover System ................................... 40
Table 15. Estimated Farm Gate Cellulosic Feedstock Costs ....................................................... 42
Table 16. Energy Yields by Conversion Technology .................................................................. 49
Table 17. Biochemical Production Costs.................................................................................... 50
Table 18. Thermochemical Production Costs ............................................................................. 51
Table 19. Cellulosic Ethanol Plants Receiving DOE or USDA Support...................................... 52
Table 20. Breakeven Oil Prices ($/barrel) .................................................................................. 69
Table 21. Profitability (NPV) with Fixed Subsidies, Deterministic Case .................................... 70
Table 22. Hypothetical Variable Biofuel Subsidy Under Various Oil Price Scenarios.................. 70
Table 23. Profitability with Fixed Subsidies at Low Oil Price Forecasts..................................... 72
Table 24. Profitability with Fixed Subsidies at Middle Oil Price Forecasts................................. 72
Table 25. Profitability with Fixed Subsidies at High Oil Price Forecasts .................................... 73
Table 26. Profitability with Volumetric Pricing for Grain Ethanol, Stochastic Case .................... 73
Table 27. Subsidy Costs, Tax Revenues, and Net Government Costs with Volumetric
Pricing for Grain Ethanol, Stochastic Case ............................................................................. 74
Contacts
Author Contact Information ...................................................................................................... 75
Acknowledgments .................................................................................................................... 75
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Introduction
Under the Energy Independence and Security Act of 2007 (EISA; P.L. 110-140), Congress
mandated the use of a large and rapidly increasing volume of biofuels as part of the U.S. national
transportation fuel base. In particular, the share of cellulosic biofuels is mandated to grow to 16
billion gallons by 2022—a daunting challenge considering that no commercial production existed
as of mid-2010. In addition to the biofuels use mandate, Congress also provides federal support in
the form of tax credits to fuel blenders and biofuels producers, and an import tariff on foreignproduced ethanol to protect and encourage the development of the U.S. biofuels industry.
Despite this strong federal support, many uncertainties remain over whether a large-scale,
economically viable cellulosic biofuels system can be successfully developed. These uncertainties
include the following.
•
Which biomass source and processing technology will provide the highest energy
yields at the lowest cost?
•
What incentives will encourage biomass producers to cultivate dedicated crops
that may take three or more years before they are established and produce
marketable output, and for which no market presently exists?
•
How will large volumes of biomass—that must be produced within a narrow
temperate-zone harvest window (e.g., March to October)—be harvested, dried,
stored, and ultimately transported to a processing plant that must operate
throughout the year?
•
What changes will be needed in the U.S. transportation-fuel infrastructure to
facilitate distributing and consuming the mandated rapid, large expansion of
cellulosic biofuels?
•
What set of federal policies can best facilitate the development of such a system?
•
Will there be regional consequences within the United States from the emergence
of such a system? What about potential international consequences?
It is still too early to begin to answer many of the broader social welfare questions, such as who
will be potential winners and losers in the development of a large-scale biomass-based biofuels
system. However, substantial research has been done in recent years concerning the economics of
production, harvest, and energy yield for various biomass sources under different processing
technologies. A review of this research can help to clarify current bottlenecks in the development
of a cellulosic biofuels industry and provide some guidance to policymakers looking to extend or
modify existing federal policy, or formulate new policy in support of such a biofuels industry.
This report attempts to summarize the current state of knowledge regarding potential biomass
feedstocks, production and marketing constraints, processing technologies, and the economics of
biomass from field to fuel under current and hypothetical policy circumstances. As such, it is
intended to serve as a reference for policymakers interested in understanding the complexity
underlying the development of a large-scale, biomass-based fuel system.
CRS has several reports addressing different aspects of the U.S. biofuels sector (including
cellulosic biofuels) and related federal policy. This report is different in that it provides a broad
overview of the nascent U.S. cellulosic biofuels industry and the many uncertainties associated
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with its future. This assessment was conducted by a team of researchers at Purdue University’s
Department of Agricultural Economics. The report provides a “snapshot” of current technological
development, but is both prospective and retrospective because it also examines emerging or
advanced technologies that may affect future biofuels development, and looks at evidence from a
growing body of research on the economics of biomass production and biofuels processing as
guidelines for shaping energy policy.
Structure of the Report
The report contains five chapters. The first chapter is an Executive Summary, which provides an
overview of the report’s main findings. The Executive Summary is followed by the main report,
which consists of Chapters 2-5, organized like sections of a typical CRS report, together with
figures and tables listed in the Table of Contents. Each chapter can be read independently;
however, Chapters 2-4 (“Introduction,” “Lingocellulosic Feedstocks,” and “Cellulosic Biofuel
Conversion Technologies”) provide the reader with background and context for a more complete
understanding of the economic analysis and discussion contained in the final chapter.
Other CRS Reports on Cellulosic Biofuels
CRS has written a suite of products on different aspects of U.S. biofuels policy in general, and
cellulosic biofuels policy in particular. These products may be accessed through the CRS online
“Issues in Focus/Agriculture/Agriculture-Based Biofuels” website, and include the following
reports:
•
CRS Report R41282, Agriculture-Based Biofuels: Overview and Emerging
Issues, by (name redacted)
•
CRS Report RL34738, Cellulosic Biofuels: Analysis of Policy Issues for
Congress, by (name redacted) et al.
•
CRS Report R40529, Biomass: Comparison of Definitions in Legislation
Through the 111th Congress, by (name redacted) and (name redacted)
•
CRS Report R40155, Renewable Fuel Standard (RFS): Overview and Issues, by
(name redacted) and (name redacted)
•
CRS Report R41106, Meeting the Renewable Fuel Standard (RFS) Mandate for
Cellulosic Biofuels: Questions and Answers, by (name redacted)
•
CRS Report RS22870, Waiver Authority Under the Renewable Fuel Standard
(RFS), by (name redacted)
•
CRS Report R40110, Biofuels Incentives: A Summary of Federal Programs, by
(name redacted)
•
CRS Report RL34239, Biofuels Provisions in the 2007 Energy Bill and the 2008
Farm Bill: A Side-by-Side Comparison, by (name redacted) and (name red
acted)
•
CRS Report R41296, Biomass Crop Assistance Program (BCAP): Status and
Issues, by (name redacted)
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•
CRS Report R40445, Intermediate-Level Blends of Ethanol in Gasoline, and the
Ethanol “Blend Wall”, by (name redacted)
•
CRS Report R40460, Calculation of Lifecycle Greenhouse Gas Emissions for the
Renewable Fuel Standard (RFS), by (name redacted) and (name redacted)
Report Authorship
This technology assessment and report was written by Purdue University, Department of
Agricultural Economics, under the leadership of Wallace E. Tyner,1 together with Sarah Brechbill2
and David Perkis.3 The report’s authorship rests with Tyner, Brechbill, and Perkis. 4 The work was
performed under contract to CRS, and is part of a multiyear CRS project to examine different
aspects of U.S. energy policy. This report was funded, in part, by a grant from the Joyce
Foundation. (name redacted) served as the CRS project coordinator.
1
Wallace E. Tyner, James and Lois Ackerman Professor of Agricultural Economics, Purdue University (West
Lafayette, IN), wtyner@purdue.edu, 765-494-0199.
2
Sarah Brechbill, former graduate student, Department of Agricultural Economics, Purdue University (West Lafayette,
IN).
3
David Perkis, Graduate Research Assistant, Department of Agricultural Economics, Purdue University (West
Lafayette, IN), perkis@purdue.edu, 765-494-0593.
4
Throughout this report, the Purdue authors will be referenced as Tyner, Brechbill, and Perkis, Purdue University,
August 2010.
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Chapter 1: Executive Summary
Cellulosic Biofuels
Cellulose-based biofuels are thought to offer substantial advantages over current corn ethanol,
foremost that they can be grown at low cost on marginal land where they will not compete with
traditional food crops. In addition, cellulosic biomass sources are abundant and widely distributed
throughout the United States.
Changes made in the U.S. Renewable Fuel Standard (RFS) in 2007 require renewable fuels use of
36 billion gallons by 2022, more than triple the nearly 11 billion gallons consumed in the United
States in 2009. A substantial portion (16 billion gallons) of the 2022 RFS is required to come
from cellulosic biofuels, an industry in its infancy and not yet economically viable. Considerable
uncertainty remains about how a cellulosic biofuels industry will evolve, what infrastructure
changes will be needed to support this development, and how the development of a biomassbased biofuels industry will alter regional economic and environmental circumstances within the
United States.
The major objective of this report is to summarize what is and is not known about cellulosic
biofuels. What do we know about the technical and economic potential of the various feedstocks
and conversion processes? What are the key bottlenecks or impediments to the development of a
cellulosic biofuels industry? What are the likely impacts of the government mandates and
incentives related to cellulosic biofuels? This paper attempts to answer these questions based on
published literature and model simulations.
The Choice of Feedstock
Current research on feedstocks focuses on maximizing yields, harvesting and collecting
efficiently, and testing various supply chains to minimize losses and overall delivered costs.
Feedstock characteristics. The preferred biomass feedstocks, known as lignocellulosic
feedstocks, are composed of three main parts: cellulose, hemicellulose, and lignin. The different
concentrations of these components in particular feedstocks will affect the efficacy of the
conversion technology. Feedstocks with larger quantities of cellulose and hemicellulose are
favored in biochemical conversion processes as the conversion technology stands presently, but
research is being conducted to incorporate lignin into conversion or modify some of its properties
through hybrid feedstocks. As a result, research offers the potential to alter the viability and
preference of various feedstocks.
Feedstock sources. Potential biomass feedstocks are numerous and widespread throughout the
United States, and include agricultural residues from such crops as corn, wheat, rice, and
sugarcane, perennial grasses such as switchgrass and Miscanthus, short-rotation woody crops
such as poplar and willow, and forest residues removed directly from the forest or taken from
mills after processing. In 2010, the Environmental Protection Agency estimated that the 16 billion
gallons of cellulosic biofuels mandated by the RFS for 2022 will be derived from dedicated
energy crops (49.4%), agricultural residues (35.6%), urban waste (14.4%), and forest residue
(0.6%). Several studies based on agronomically viable U.S. biomass production suggest that the
biofuels potential is significantly larger than 16 billion gallons.
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Feedstock production and harvest costs. Each type of biomass faces tradeoffs in terms of
production, storage, and transportation. Dedicated energy and tree crops have large up-front
establishment costs and may take several years to produce a commercial harvest, but can produce
high yields with relatively low maintenance costs thereafter. Residues are nearly costless to
produce, but confront difficult collection strategies and do not always produce uniform biomass
for processing. Agricultural residues also face complicated trade-offs between soil nutrient loss
and biomass yield, as well as questions about the optimal timing strategy for harvesting the main
crop and the residue (either jointly or separately). Logging residues confront both a tradeoff with
energy production at the plant (via burning) and a uniformity of quality issue for processing.
Producer participation. A key aspect of biomass production will be understanding what
economic incentives will encourage producer participation in growing and/or collecting biomass
feedstocks. Whether the feedstock is a residue or dedicated crop, there is not much experience
among producers, markets do not presently exist for most potential biomass crops, and few risk
management tools (e.g., crop insurance) are available to producers. Studies presently use a wide
range of estimated participation—30% to 80%—depending on the size and location of the
processing plant, the price being paid for biomass by the plant, the cost of producing, harvesting,
and collecting biomass for a producer of a given size, and the terms of producer contracts.
Feedstock transportation. From the perspective of the biofuels processing plant, the choice of
which feedstock to use will depend on the location of the plant and the local feedstock supply
availability. Agricultural residues and perennial grass feedstocks have relatively low energy
density, which means a large volume would be needed by a plant to meet demand. As a result,
transportation costs may be crucial in the biomass choice. For example, a 50-million-gallon-peryear cellulosic ethanol plant (that converts a ton of corn stover—which includes the stalks, leaves,
and cobs of the corn plant—into 90 gallons of biofuel) would need over 550,000 tons of corn
stover harvested from roughly 280,000 acres of land (assuming 2 tons per acre of removable corn
stover) in order to stay operational for a year. Because trucks become physically full when
hauling biomass before reaching their weight limits, more truckloads would be required for
cellulosic biofuel production relative to corn-based ethanol, thus making the per-unit transport
cost much higher for cellulosic feedstocks than for corn. The greater number of trucks required to
transport cellulosic feedstocks might also impose a heavy burden on rural transportation
infrastructure. Compacting the biomass prior to transport may result in net savings if transport
cost savings offset densification costs.
Feedstock storage. Because the harvest of dedicated energy crops and agricultural residue is
concentrated during one part of the year, long-term storage will be needed to hold the biomass
until the plant is ready to use it (keeping in mind that biofuels plants are designed to run yearround). For plants that can eventually use multiple feedstocks, they will be able to use fallharvested biomass around the time it is harvested, followed by perennial grasses with their wider
harvest period, or woody biomass or urban waste that can become available throughout the year.
Storage costs, inclusive of biomass dry-matter loss due to weathering and exposure, could be
crucial in determining optimal feedstock sources in certain agro-climatic zones.
Uniformity of feedstock. Biomass can have highly inconsistent quality and characteristics, not
only among feedstocks but within a feedstock type. Delivering a uniform feedstock to the plant
will decrease processing and pretreatment costs. Plants receiving biomass that has been harvested
differently and stored under a variety of conditions will incur additional costs to arrive at a
uniform feedstock product. With more experience and the development of the appropriate
harvesting, collecting, and storage technologies, both standardization and densification of
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biomass could take place before the biomass even arrives at the plant, which would lower per-unit
transportation costs and allow the plant to start with a uniform and consistent product, regardless
of its source.
The Choice of Processing Technology
Two primary biomass-to-biofuel conversion methods for lignocellulosic feedstocks are currently
under consideration for commercial use—biochemical conversion and thermochemical
conversion. Energy yields and production costs for each process may vary substantially based on
the specific implementation design and feedstock.
Biochemical Conversion
Process. The biochemical conversion process is similar to the process currently used to produce
ethanol from corn starch. Enzymes or acids are used to break down a plant’s cellulose into sugars,
which are then fermented into liquid fuel. Four key steps are involved. First, feedstock is
pretreated by changing its chemical makeup to separate the cellulose and hemicellulose from the
lignin in order to maximize the amount of available sugar. Second, hydrolysis uses enzymes or
acids to break down the complex chains of sugar molecules into simple sugars for fermentation.
Third, fermentation is used to convert the sugar into liquid fuel. Fourth, the liquid fuel is distilled
to achieve a 95% pure form.
Production costs. Each step of the conversion process incurs costs. A key cost of pretreatment is
the time incurred. Biological pretreatment, using fungi, for example, can take 10 to 14 days.
Chemical pretreatment may be faster but with higher costs for chemicals. Hydrolysis cost depends
largely on the cost of enzymes, which has been estimated at $0.50 per gallon. However,
hydrolysis may require different enzymes for different parts of the plant, thus incurring varying
enzyme costs for different feedstocks. The effectiveness of hydrolysis is highly dependent on the
effectiveness of pretreatment—too much lignin remaining after pretreatment will impede enzyme
efficiency. More accessible sugar (following efficient pretreatment) may improve enzyme
function at lower costs. Regarding fermentation, different sugar types, for example, hexoses (sixcarbon sugars) or pentoses (five-carbon sugars), may require different yeast strains for
fermentation. Improved yeast strains that ferment various sugars could lower production costs.
Some cost savings may be available through management of recovered lignin, which can be
burned to generate electricity and steam to power the bio-refinery or for other outside uses.
Primary research areas for potential improvement in energy yield and cost reduction are in
pretreatment, hydrolysis, and fermentation. Distillation is already a well-established technology.
Successful improvements should make the process adaptable to multiple feedstocks.
Energy equivalency. The biochemical conversion of biomass into alcohol produces a liquid fuel
(i.e., ethanol) that contains only about 67% of the energy content of gasoline. When ethanol is
blended with gasoline at low rates (e.g., 10% or less), the reduced gas mileage resulting from the
blended fuel is sufficiently small that most consumers are likely to treat the blended fuel as
equivalent volumetrically (i.e., gallon for gallon) with gasoline. However, at higher blend rates,
especially at an 85%-ethanol blend rate (E85), the lower mileage is more noticeable and
consumers may prefer energy-equivalent pricing, whereby the price for a gallon of E85 should be
only 72% of the price of a gallon of gasoline.
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Petroleum infrastructure equivalency. Because of its physical properties, ethanol cannot be used
in the same infrastructure (e.g., pipelines, storage tanks, service pumps) used to deliver retail
gasoline. Nor can it be used directly by standard vehicle systems that have not been adjusted for
ethanol blends greater than 10% (or 15% for model year 2007 or newer light-duty vehicles). This
both limits ethanol retail delivery opportunities and raises the cost of delivery.
Thermochemical Conversion
Process. Thermochemical conversion processes, which use heat to decompose the feedstock, are
well established and developed. Unlike biochemical conversion, thermochemical conversion uses
the entire biomass, including the lignin portion. There are two main types of thermochemical
conversion processes—gasification and pyrolysis.
Gasification is an anaerobic process where the partial combustion of biomass feedstock at over
700°C generates synthesis gas, or syngas, a mixture of carbon monoxide and hydrogen. The
syngas must be cleaned of tar, ash, and other impurities prior to the next processing step. The
Fischer-Tropsch process is then used to convert the “cleaned” syngas into a variety of liquid fuels.
The presence of impurities in syngas might disrupt the Fischer-Tropsch process by inactivating
the catalyst. Also, prior to gasification, the biomass must have 20% or less moisture. For
practically any type of biomass, drying will be required. Established drying technologies usually
take place at high temperatures, which creates an opportunity for improvement. Gasification is
prohibitively expensive and would only be used commercially at extremely high gasoline prices.
Pyrolysis is the partial combustion of biomass feedstock at 450°C to 600°C in the presence of no
oxygen, which produces bio-oil. Bio-oil, which is rich in carbon, is similar to crude oil and must
be refined into biofuels. Fast pyrolysis requires higher temperatures than slow pyrolysis but
occurs in about two seconds. Currently, fast pyrolysis is receiving the most attention as a viable
conversion process. Keeping the pyrolysis oil stable long enough to transform the bio-oil into
hydrocarbons is one of the major barriers in the pyrolysis pathway. Because pyrolysis converts
the biomass into a liquid form, it is easier to store and transport.
Energy and infrastructure equivalency. The thermochemical conversion of biomass into
synthetic fuels (or green hydrocarbons) produces liquid fuels that are essentially energyequivalent to their petroleum counterparts, and fully adaptable for use in existing petroleum fuel
infrastructure. As a result, energy-equivalent pricing favors thermochemically processed biofuels
over biochemically processed biofuels.
Research keys. With respect to gasification, research is being done to dry biomass at lower
temperatures and use excess heat from drying for other purposes. With respect to pyrolysis,
stability of bio-oil and general cost reductions are the major research issues.
Commercialization Status
Neither conversion process is ready for commercialization. Presently, most cellulosic biofuels
production is taking place in laboratories and small-scale demonstration and pilot plants. Plans for
commercial plants have been announced by several companies, but development is likely to be
slow, absent significant incentives. Substantial cost reductions will be necessary for successful
commercial development. Several processes are currently being researched and developed in
laboratories, but it is difficult to know with any certainty whether those that appear successful in
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trials will also be successful on a commercial scale. Given the lack of commercial production to
date, per-gallon cost estimates for cellulosic biofuels are highly uncertain, but estimates based on
laboratory and pilot plant results range from $2.50 per gallon to slightly over $3.00 per gallon.
The Department of Energy Biomass Program’s Theoretical Ethanol Yield Calculator calculates
the maximum theoretical biofuel yield per ton of feedstock with biochemical conversion of
feedstocks based on their composition. Based on its results, the theoretical yields for corn stover,
switchgrass, and forest thinning are 113, 97, and 82 gallons per dry ton, respectively. As plants
and technologies approach commercialization, the rate of efficiency could approach 100% of the
maximum theoretical energy yield.
Economic Comparison of Biomass, Processing Technology, and
Policy Choices
Current biofuels production technologies (biochemical and thermochemical) were analyzed under
the market conditions that prevailed during mid-2010, using a deterministic simulation model
(with and without the tax credit subsidy).
Under volumetric pricing, with the current ethanol tax credit of $0.45 per gallon, the average
corn-ethanol plant breaks even (operates at zero profit) when the price of oil is $56.33 per barrel
(and the stochastically modeled corn price is $3.41 per bushel). In other words, the tax credit
allows ethanol plants to operate profitably whenever oil prices are $56.33 per barrel or higher.
Without the ethanol tax credit, the breakeven price of oil rises to $71.45 per barrel (still below
recent market prices). Higher oil prices are needed to offset higher corn prices. The breakeven oil
price scenarios are substantially higher for cellulosic biofuels—even with a much higher tax
credit of $1.01 per gallon, whether produced from biochemical or thermochemical processes
($92.74 and $113.77, respectively, with tax credit).
Under energy-equivalent pricing, the breakeven oil price for corn ethanol rises considerably—
$91.62 with the tax credit, and $114.19 without the tax credit—as the consumer has to spend
more money to obtain the same energy (or mileage) available from petroleum fuels. The
breakeven oil price is prohibitive for biochemical cellulosic biofuels ($145.98 with subsidy;
$196.64 without). However, because its energy yield is nearly equal to fossil fuels,
thermochemical biofuels appear more competitive ($98.92 with subsidy; $143.92 without).
Simulation results suggest that corn ethanol is profitable only if based on volumetric pricing as
compared to energy-equivalent pricing. Biomass-based cellulosic biofuels are not yet profitable
under either pricing approach (volumetric or energy-equivalent), even with a much higher tax
credit of $1.01 per gallon. Currently, the fixed tax credit ($0.45 per gallon) incentivizes biofuels
production during periods of low petroleum fuel prices; however, during periods of high oil prices
(when biofuels are inherently more competitive with fossil fuels), the fixed subsidy adds to plant
profitability at taxpayers’ expense while encouraging greater biofuels production than is sought
by the marketplace. A variable subsidy that declines with higher oil prices has been proposed as a
policy tool to maintain biofuels incentives while limiting taxpayer exposure. This report includes
a comparative analysis of a fixed versus variable tax credit, not as a policy recommendation, but
strictly as a comparative analysis to aid Congress’s understanding of the differences between the
two policy options. Model results found that the variable subsidy lowered producer risk and
taxpayer costs relative to the fixed subsidy, but had slightly lower average returns—largely
because subsidy payments were not made at high oil prices.
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Chapter 2: Introduction
The major objective of this paper is to summarize what is and is not known about cellulosic
biofuels. For years cellulose-based biofuels have been touted as the future of bioenergy. What is
the situation today? What do we know about the technical and economic potential of the various
feedstocks and conversion processes? What are the likely impacts of the government mandates
and incentives related to cellulosic biofuels? This report attempts to answer these questions based
on published literature and model simulations.
Recent changes in the Renewable Fuel Standard (RFS) in the United States will require
renewable fuels production to more than triple in the next 12 years (by 2022), and those increases
are expected to come largely from cellulosic biofuels, an industry in its infancy and not yet
economically viable. 5 Cellulosic feedstocks of interest include agricultural residues from such
crops as corn, wheat, rice, and sugarcane, perennial grasses such as switchgrass and Miscanthus,
short-rotation woody crops such as poplar and willow, and forest residues removed directly from
the forest or taken from mills after processing, just to name a few. Current research on feedstocks
focuses on maximizing yields, harvesting and collecting efficiently, and testing various supply
chains to minimize losses and overall delivered costs (Figure 1). Cellulosic conversion
technologies are not the same as for corn ethanol, as this biomass material is much more
complicated than starch-based feedstocks.6 Conversion technologies receiving the most attention
include the biochemical and the thermochemical approaches. These technologies are not
completely new, but their previous applications differ greatly from cellulosic biofuels.
Figure 1. Cellulosic Ethanol Supply Chain
Source: U.S. Department of Energy, Energy Efficiency and Renewable Energy, Alternative Fuels and Advanced
Vehicles Data Center, 2009, at http://www.afdc.energy.gov/afdc/ethanol/basics.html.
With both the supply of feedstocks and conversion technologies still in the early stages of
development and neither having yet arrived at a commercial scale, future progress in both areas is
uncertain. It remains to be seen whether the development of one will come to dominate the
development of the other, or whether the two can evolve simultaneously while still arriving at a
workable outcome to fulfill the advanced biofuels requirements of the RFS.7 The primary theme
5
J. W. Kram, “Building Blocks to Biofuels Success,” Ethanol Producer Magazine, December 2008.
E. Petiot, “The Important Role of Enzymes in Cellulosic Ethanol,” Ethanol Producer Magazine, November 2008.
7
For more information see CRS Report R40155, Renewable Fuel Standard (RFS): Overview and Issues, by (name
redacted) and (name redacted).
6
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for both feedstocks and conversion technologies is cost reduction in order to make
commercialization a reality and to make cellulosic biofuels competitive with other energy
sources. Research and development must make cellulosic biofuels production as flexible as
possible in order to accommodate future improvements. Governments and universities will play
an important role in reducing risk and providing guidance as feedstock producers and biofuels
plants break ground on cellulosic biofuels production.
This report focuses on feedstock production, feedstock logistics, and biofuel production;
however, challenges and obstacles to the distribution infrastructure and end use of biofuels in
vehicles are also discussed. The remainder of the report is divided into three sections.
The first section (“Chapter 3: Lignocellulosic Feedstocks”) covers the various types of
lignocellulosic feedstocks, their respective characteristics, and a brief summary of how each
feedstock is established and maintained. Then yields and production costs are outlined from a
variety of studies to show the potential market effect of location, input costs, and assumptions.
Next is a discussion of supply logistics and the challenges this new type of feedstock presents
with respect to storage, quality, and transportation.
The second section of the report (“Chapter 4: Cellulosic Biofuel Conversion Technologies”)
considers biochemical and thermochemical conversion technologies. After a summary of each of
the processes, the expected and theoretical energy yields of each technology are outlined. A
summary of current estimates of capital and operating costs for each technology allows for
discussion of where potential cost reductions might be made. Finally, a current list of planned and
proposed pilot and demonstration plants is presented, with a discussion of how funding from the
Department of Energy has been allocated so far.
The final section of the report (“Chapter 5: Economics and Policy of Cellulosic Biofuels”)
discusses the current status of relevant biofuels policy and some of the potential future policy
options related to cellulosic biofuels. It also analyzes the effects of changes in these policies on
the economics of cellulosic biofuel production. In particular, a simulation model is used to
compare the market effects of a fixed subsidy (representative of the current fixed tax credit
subsidy) and a variable subsidy that declines to zero as oil prices rise to a threshold level.
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Chapter 3: Lignocellulosic Feedstocks
Lignocellulosic feedstocks are composed of three main parts: cellulose, hemicellulose, and lignin.
Depending on the conversion process used, the concentration of these components in a particular
feedstock will affect the efficacy of biofuel production. Cellulose is a sugar polymer chain of
glucose, or six carbon sugars. Hemicellulose is a sugar polymer chain of xylose, or five carbon
sugars. Lignin forms the hard plant cell walls and cannot be fermented into liquid fuels in a
biochemical conversion process, as can cellulose and hemicellulose. Lignin, however, can be
utilized in the thermochemical conversion process and serves as a byproduct in the biochemical
conversion process useful for providing energy to power the plant and even for generating
electricity. The characteristics of the different parts of biomass and the amount of each present in
a particular feedstock play a role in determining the efficacy of conversion technologies. The
remainder of this chapter will discuss the production, yields, costs, and supply of the major
lignocellulosic feedstocks in the United States—agricultural residues, perennial grasses, forest
residues, and short-rotation woody crops.
Feedstock Types
Table 1 gives estimates of the composition of some feedstocks of interest. Feedstocks with larger
quantities of cellulose and hemicelluloses are favored in biochemical conversion processes as the
conversion technology stands presently, but research is being conducted to incorporate lignin into
conversion or modify some of its properties through hybrid feedstocks. As a result, research
offers the potential to alter the viability and preference of various feedstocks.
In addition to cellulose, hemicellulose, and lignin, lignocellulosic feedstocks also include organic
acids, ash, proteins, oils, minerals, and other compounds.8 Figure 2 uses the composition
estimates from Table 1 to determine the average composition of corn stover, switchgrass,
Miscanthus, and hardwoods. Examples of biomass resources include the following.
•
Agricultural crop residues (corn, wheat, rice, etc.)
•
Perennial grasses (switchgrass, Miscanthus)
•
Short-rotation woody crops (poplar, willow, eucalyptus)
•
Conventional logging residues, wood processing mills residues, and removal of
excess wood from forestlands
•
Manure
•
Food/feed processing residues
•
Municipal solid waste and urban wood waste
8
North Central Sun Grant Center, Composition of Herbaceous Biomass Feedstocks, Sun Grant Initiative—North
Central Center, South Dakota State University (Brookings, SD), June 2007, hereafter referred to as NC Sun Grant
Center (2007); S. R. Bull, U.S. Department of Energy, Biofuels Research Program, Energy Sources, Part A: Recovery,
Utilization, and Environmental Effects, 13(4), 1991, pp. 443-442, hereafter referred to as Bull (1991); and N. S. Mosier,
“Bioprocess Engineering for Biofuels: Pretreatment and Hydrolysis,” Second Generation Biofuels Symposium 2009,
Purdue University, West Lafayette, IN, 2009.
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Table 1. Estimated Composition of Lignocellulosic Feedstocks
Feedstock
Corn stover
Hardwood
Wheat straw
Softwood
Herbaceous energy
crops
Switchgrass
Miscanthus
Cellulose (%)
Hemicellulose (%)
Lignin (%)
Source (Year)
35
28
16-21
Scurlock (undated)a
38
26
19
NC Sun Grant Center (2007)b
32
44
13
Bull (1991)c
31
19
18
Bransby (2007)d
45
30
20
Scurlock (undated)a
38-50
25-35
15-25
Taylor (2009)e
45
19
26
Hamelinck et al. (2003)f
38
29
15
NC Sun Grant Center (2007)b
38
36
16
Bull (1991)c
42
21
26
Scurlock (undated)a
50
23
22
Bull (1991)c
41
18
28
Bransby (2007)d
45
30
15
Bull (1991)c
44-51
42-50
13-20
Scurlock (undated)a
37
29
19
NC Sun Grant Center (2007)b
31
24
18
Bransby (2007)d
32
25
18
Hamelinck et al. (2003)f
44
24
17
Scurlock (undated)a
43
24
19
NC Sun Grant Center (2007)b
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from sources listed.
a.
J. Scurlock, “Bioenergy Feedstock Characteristics,” Biomass Basics: Fact Sheets, Oak Ridge National
Laboratory (Oak Ridge, TN), undated.
b.
North Central Sun Grant Center, Composition of Herbaceous Biomass Feedstocks, Sun Grant Initiative—North
Central Center, South Dakota State University (Brookings, SD), June 2007.
c.
S. R. Bull, U.S. Department of Energy, Biofuels Research Program, Energy Sources, Part A: Recovery, Utilization,
and Environmental Effects, 13(4), 1991, pp. 443-442.
d.
D. I. Bransby, Cellulosic Biofuel Technologies, “Alternative Transportation Fuels Program,” Alabama
Department of Economic and Community Affairs (Montgomery, AL), February 2007.
e.
E. L. Taylor, “Co-products and By-products of Woody Biorefinery Processing,” Transition to a Bio Economy:
The Role of Extension in Energy, Farm Foundation Conference (Little Rock, AR), 2009.
f.
C. N. Hamelinck, G. van Hooijdonk, and A. P. C. Faaij, Prospects for ethanol from lignocellulosic biomass: technoeconomic performance as development progresses, Report NWS-E-2003-55, Utrecht University and
Copernicus Institute (Utrecht, Netherlands), 2003.
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Figure 2. Composition of Lignocellulosic Feedstocks by Type
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010.
Note: “Other” includes organic acids, ash, proteins, oils, minerals, and other compounds. Each pie chart is
constructed from the simple average of the different estimates in Table 1.
Dedicated Energy Crops
Perennial grasses, including switchgrass and Miscanthus, have high yields (especially in warmer
areas with a longer growing season), are low-maintenance, and have a more positive
environmental impact than producing ethanol from corn. However, perennial grasses are not
currently being grown on a widespread basis. Unlike residues left after the harvest of a primary
commercial crop, grasses themselves are primary crops that require a relatively long-term
commitment of resources to growing a crop that remains relatively obscure. As a primary crop
used for energy production, and unlike residues used for energy production, perennial grasses are
the only source of revenue on a given area of land. Mistakes with establishment and maintenance
serve to deplete potential profits. There is no commodity market to guarantee the price of
perennial grasses or to allow producers to sell their product freely. The development of contracts
between producers and processing plants will prove particularly important for perennial grasses
grown as primary crops with no market.
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As of October 2010, there was no crop insurance available for perennial grasses, and this was
thought to be a potential problem for new growers.9 Crop insurance programs for perennial
grasses will only be developed once a base of acreage is planted, but many producers may be
reluctant to plant perennial grasses in the absence of crop insurance.10 Switchgrass is currently
being grown by the University of Tennessee Biofuels Initiative and by the Oklahoma Bioenergy
Center. In Tennessee, 725 acres of switchgrass were planted during spring 2008 and an additional
1,900 acres were planted during spring 2009.11 Producers accepted into the program are paid at a
rate of $450 per acre of switchgrass per year for a three-year contract. An additional 3,000 acres
were expected to be planted in 2010. In Oklahoma, 1,100 acres of switchgrass were planted in
spring 2008, with 1,000 acres in a single tract of land, which is the largest area of switchgrass
planting in the world. 12
A stand of switchgrass will grow annually for 10 years, while a stand of Miscanthus may grow
annually for 15 to 20 years.13 Perennial grasses must first be established and may not be harvested
during the first year. It may also take a few harvests before the grasses reach their peak yields.
Deep roots help the plant store resources from year to year, which reduce necessary fertilizer
inputs. Perennial grasses are also able to take advantage of long growing seasons. This is because
planting and germination do not take place annually and the plants are above the ground and
taking in sun for more days starting in the spring and going until early fall.
Due to their nutrient storage ability, these grasses can be grown on marginal cropland that is often
considered unfit for growing corn or soybeans. However, simply because these grasses will grow
on marginal land does not mean that they will yield well, and lower yields will ultimately
increase the production cost per ton. Recent studies from the University of Tennessee arrived at
contrary conclusions on this matter, with one finding that a biofuels processing plant would look
for switchgrass from more productive soil types in order to minimize delivered costs, while the
other found that producers would choose to plant switchgrass on less productive soils, since more
productive soils are reserved for corn production. 14 This contrast reflects the differences in
objectives from the perspectives of producers and biofuels processing plants.
Most early Miscanthus research has taken place in Europe, but some research plots are now being
grown in the United States. Miscanthus is expected to yield well in the same locations where
switchgrass yields well. However, field experiments in Illinois and Iowa conducted thus far
indicate that switchgrass yields can be as little as one-fourth of Miscanthus yields.15 Miscanthus
yields are higher than switchgrass yields due to their larger mass, taller height, and longer
growing season. Yields for both switchgrass and Miscanthus are high relative to agricultural
residues. This higher yield serves to decrease the production cost per ton, but perennial grasses
are still more costly to produce than residues, because they are dedicated crops that must be
9
For a complete list of crop insurance programs, see “2010 County Crop Programs,” Risk Management Agency,
USDA, at http://www.rma.usda.gov/data/cropprograms.html.
10
R. C. Christiansen, “The Cellulosic Ceiling,” Ethanol Producer Magazine, August 2009.
11
S. R. Schill, “Cobs to Switchgrass to Gasoline Parity,” Ethanol Producer Magazine, June 2009.
12
S. R. Schill, “Oklahoma seeds 1,000 acres of switchgrass,” Biomass Magazine, July 2008.
13
L. Gibson and S. Barnhart, “Switchgrass,” University Extension, Iowa State University, 2007, hereafter referred to as
Gibson and Barnhart (2007); and M. Khanna, “Cellulosic Biofuels: Are They Economically Viable and
Environmentally Sustainable?” Choices 23(3), 2008, pp. 16-21, hereafter referred to as Khanna (2008).
14
J. A. Larson and B. C. English. ”Risk Management for Energy Investments: Agricultural Policy and Extension
Recommendations,” Transition to a Bio Economy: The Role of Extension in Energy, Farm Foundation Conference
(Little Rock, AR), 2009, hereafter referred to as Larson and English (2009).
15
Khanna (2008).
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established and maintained. Current estimates for yields tend to be reported from small-scale
research trials, where establishment may be more likely to succeed within the first year and allow
for a first-year cutting. It is uncertain whether perennial grass yields will be as high once it is
grown commercially by producers with limited switchgrass production experience. 16 Switchgrass
is planted as a seed, while the most productive variety of Miscanthus does not produce seeds and
must be planted as rhizomes, which makes establishment costs much higher. Miscanthus will also
require more machine power to harvest because the quantity of biomass per acre is so much larger
than with switchgrass. Despite establishment and harvesting costs being higher for Miscanthus,
high yields allow those costs to be spread out over more tons of biomass per acre than
switchgrass, which serves to lower the production cost per ton of Miscanthus. Further discussion
of yields and production costs are in the sections that follow.
In the United States, perennial grasses could likely be grown on land that is currently not in use or
is part of the Conservation Reserve Program (CRP), which protects land from erosion and
environmental damage by maintaining vegetative cover such as native grasses.17 For grasses, in
particular, to be a viable feedstock for cellulosic biofuels, producers of these fairly uncommon
crops will need to assume the risk of growing a long-run crop with high upfront establishment
costs and possibly having to replant. Studies have found that switchgrass must be replanted 23%
to 25% of the time due to seed dormancy and mistakes with establishment,18 in which case
establishment costs would increase substantially and overall per ton production costs would
increase. Risk associated with high upfront establishment costs may be addressed through
government grants to help with establishment costs, university planting programs that provide
funding and expertise regarding planting and maintenance, or contracts with area cellulosic
biofuels plants to supply biomass. The profitability of these relatively unknown crops in largescale production, the profitability of other crops that could be grown in place of perennial grasses,
and the proximity of production facilities will be important in determining the extent to which
they are planted. Many producers who will enter into contracts with plants may be small and/or
part-time operators who may lack the education, expertise, and equipment necessary to establish
and maintain a perennial grass stand in a cost-effective manner. These producers may also be
growing the grasses on small and dispersed fields, which will make management more expensive
and less efficient. It is expected that land grant university extension programs will play a role in
helping producers streamline and perfect the growing process once commercial production
becomes more common. 19
Agricultural Residues
Agricultural residues, such as corn stover, which includes the stalks, leaves, and cobs, are the byproducts left after harvest of crops already being planted. Residues are more readily available
than perennial grasses, which need to be established, and are typically put forth as a less
expensive feedstock option, because their establishment cost is attributed to the initial crop.
Instead, the primary costs associated with residues are nutrient replacement, harvesting, storage,
16
Gibson and Barnhart (2007); D. I. Bransby, Switchgrass Profile, Oak Ridge National Laboratory (Oak Ridge, TN),
1999; and C. D. Garland, Growing and Harvesting Switchgrass for Ethanol Production in Tennessee, University of
Tennessee Biofuels Initiative, Univ. of Tennessee (Knoxville, TN), 2008, hereafter referred to as Garland (2008).
17
CRS Report RS21613, Conservation Reserve Program: Status and Current Issues, by (name redacted).
18
Larson and English (2009); and M. Duffy, Estimated Costs for Production, Storage, and Transportation of
Switchgrass, A1-22, Iowa State Univ. (ISU) Extension, ISU (Ames, IA), 2008, hereafter referred to as Duffy (2008).
19
Larson and English (2009).
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and transportation. For the purposes of this discussion, corn stover will be used as the primary
residue.
Crop residues serve to prevent erosion and nutrient loss while a field is fallow, and excess
removal of residue can compromise that protection and reduce soil organic matter. The
appropriate amount to remove will depend on tillage practices, crop rotation, soil type, and
topography. Extensive literature exists regarding the effect of residue removal on the health of the
soil. Generally, more residue removal is thought to reduce organic matter and leave the soil
susceptible to erosion. However, no one conclusion has been reached on the maximum amount
that can safely be removed. 20 In fact, with increasing corn yields and residues roughly equal in
weight to corn, some have argued that residue removal may be necessary as residue amounts
increase. The amount of residue removed will depend, in large part, on the equipment used to
remove it. For example, if conventional hay equipment is used, the amount of residue removed
can vary depending on the number of passes. Baling alone will collect about 38% of residue,
raking and baling will collect about 52.5% of residue, and shredding, raking, and baling could
collect 70% of residue.21
Work remains to find the most efficient residue collection technique. For example, making
multiple passes through the field—first to harvest the main crop, then to shred, rake, bale, and
collect the residue—will increase the cost of collecting the residue and increase soil compaction
in the field. In contrast, a single-pass system that performs several functions simultaneously may
be overly slow to collect the principal crop and may run the risk of unanticipated inclement
harvest-time weather. More efficient collection technologies will be capital-intensive and will
likely be adopted by larger producers, which will leave smaller producers to use existing hay
equipment or hire a custom operator to harvest residues.
Time is a critical factor for farmers in the fall harvest period. Harvest of residues must take place
within a fairly small window after corn has been harvested and will be highly dependent on
weather conditions. The top priority of producers will certainly be the corn crop, and if removing
residue puts their corn yield at risk, producers may be reluctant to agree to remove it.
A one-pass harvest system that attaches to the combine appears to be the next step in equipment
development for residue harvest if it can be done without slowing down the harvest. Hay
equipment is available but is less efficient, and equipment that will only collect residues may not
appear for another 15 to 20 years.22 Current research at Iowa State University is developing a onepass harvesting system that attaches to a conventional combine as a modified header in the front
and a chopper and blower in the back. This was preferred to a one-pass system that harvests the
grain and the residue at the same time in a single stream, because additional equipment would be
needed to separate the grain and the residue, and this mixture of crops may change a producer’s
eligibility for government programs and crop insurance. Stover is chopped into two-inch pieces
and blown into a wagon running alongside the combine. Currently, this attachment system is
estimated to cost between $35,000 and $50,000.23 The system is equipped with a switch to shut
20
S. C. Brechbill and W. E. Tyner, The Economics of Biomass Collection, Transportation, and Supply to Indiana
Cellulosic and Electrical Utility Facilities, Working Paper 08-03, Department of Agricultural Economics, Purdue
University (West Lafayette, IN), April 2008, hereafter referred to as Brechbill and Tyner (2008).
21
Ibid.
22
S. R. Schill, “Collecting Mountains of Stover,” Ethanol Producer Magazine, 2007.
23
J. Bernick, “One-Pass Stover Harvest,” AgWeb online Farm Journal, January 10, 2009, at http://www.agweb.com/
article/One-Pass_Stover_Harvest_202067/, hereafter referred to as Bernick (2009).
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off the attachment and allow the residue to be left in a windrow behind the combine should
residue harvest interfere with or slow grain harvest. Work continues to ensure that the use of this
system does not slow down conventional grain harvest, regardless of the amount of residue the
producer chooses to remove.
A one-pass harvesting system allows for residue to be harvested with the grain and keeps the
residue from ever touching the ground, which may cause soil contamination and make conversion
to liquid fuels less efficient. However, a current shortcoming of this method is that residue
coming directly from the combine only has a density of about 3 to 4 pounds per cubic foot, while
the density would need to be between 12 and 14 pounds per cubic foot to transport it efficiently
and fill a truck to its allowed weight limit. 24
Research is also being conducted to determine at what height residue should be cut. Corn plants
tend to have more moisture in the lower part of the plant, making this portion less efficient for
conversion as moisture must be removed prior to conversion; this portion also is best left on the
field to protect against soil erosion. The upper part and the cobs, however, have lower moisture
contents and are most suitable for producing biofuels to make pretreatment and processing as
efficient as possible. 25
While residues are convenient because they accompany the primary crop, there is no reason that
they must be removed and no long-term commitment to do so unless the producer enters into a
contract with the plant. Perennial grasses, however, are a commitment that must be harvested
each year for the life of the stand.
Dedicated Tree Crops
Short-rotation woody crops grown for biomass on agricultural or other open land may include
hardwood varieties such as poplar and willow. These trees are commercially grown as a crop and
are adaptable to many different regions throughout the country. Short-rotation woody crops are
attractive as a biomass feedstock because they re-grow quickly following harvest. Some trees are
already being harvested to make pulp and other small wood products. Short-rotation woody crops
also provide environmental benefits such as low inputs, improved soil and water quality, reduced
CO2 emissions, and enhanced biodiversity. 26
To establish short-rotation woody crops, cuttings from year-old trees taken during the dormant
season must be planted. In addition to high establishment costs (as with dedicated energy crops),
it takes three to four years before the trees are ready to be harvested and begin yielding
commercial returns. The life of the entire stand will be at least 20 years, and multiple (but not
annual) harvests will take place. For example, seven to eight harvests (i.e., harvests every three to
four years) may occur during the life of a willow tree crop.27 During the growing time, very little
annual maintenance is needed. Cost reduction for tree crop production will likely come from
24
Bernick (2009).
A. Perry, “Cellulosic Ethanol from Corn Stover: Calculating—and Improving—the Bottom Line,” Agricultural
Research, vol. 56, no. 9, October 2008, pp. 14-15.
26
State University of New York, College of Environmental Science and Forestry, EcoWIllow, v. 1.2, undated, at
http://www.esf.edu/willow/default.htm, hereafter referred to as State Univ. of New York (undated).
27
T. A. Volk, T. Verwijst, P. J. Tharakan, L. P. Abrahamson, and E. H. White, “Growing fuel: a sustainability
assessment of willow biomass crops,” Frontiers in Ecology and the Environment 2(8), 2004, pp. 411-418.
25
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increased yields and production efficiency, as well as a mechanism for valuing environmental
benefits. 28 Poplar and willow hybrids that will increase yield potential and reduce lignin content
are currently being researched. Transportation efficiencies can also be achieved as stands of
dedicated tree crops can be grown close to the conversion facilities and do not have to be trucked
from commercial forests. Storage is less of an issue with tree crops because they can be stored on
the stump and harvested as needed.
Forest Residues
Forest residues include naturally grown trees that may be of poor quality or too small to be used
commercially, residues left in the forest after commercial logging, residues from clearing rotten
trees that could cause forest fires, and residues from processing mills. Currently these residues,
which are sustainable and plentiful, are burned, left in the forest to decay, or sent to landfills.29
Using forest residues can mitigate greenhouse gases, improve the health of forests, and avoid
catastrophic fires and diseases. Collecting residues from within a forest, however, can be difficult,
because efficient equipment has not been developed and most commercial logging operations are
not set up to handle residues. Currently, the more efficient harvesting options chosen by largescale logging operations are methods that harvest round wood and biomass simultaneously.
Similar to one-pass corn and corn stover harvesters, these systems do not require major changes
to the current operation and do not add extra steps to the harvest process. However, one-step
harvesters are capital-intensive and are best suited for larger tracts of land.30
Forest biomass that does not come from a mill will be bulky, dirty, and high in moisture. Residues
coming directly from the mill are advantageous, because they have lower moisture content and
are in a more consistent form. However, these mill residues, which include bark, chunks of wood,
shavings, and sawdust, are currently being used to create energy for processing mills or in other
wood products, which may not leave much residue available for biofuel production.
The current language of the Energy Independence and Security Act of 2007 puts restrictions on
the types of land from which residues can be collected for use as a cellulosic feedstock. Residues
cannot be collected from federal lands, old-growth forests, or imperiled forests. It is uncertain
whether the current limited definition would be a barrier to the production of cellulosic biofuels,
as feedstocks vary in their distribution and ownership among regions. Woody biomass, for
example, tends to be located on private land in the southeastern United States but on federal lands
in the western United States.31 However, H.R. 2454, the American Clean Energy and Security Act
passed by the House of Representatives on June 26, 2009, would broaden the definition of
renewable biomass to its farm bill definition, which allows renewable biomass to include that
which is removed from federal lands. 32 The Senate has yet to consider the bill.
28
For examples, see CRS Report RL34042, Provisions Supporting Ecosystem Services Markets in U.S. Farm Bill
Legislation, by (name redacted).
29
Taylor (2009).
30
W. Hubbard, L. Biles, C. Mayfield, S. Ashton (eds.), Sustainable Forestry for Bioenergy and Bio-based Products:
Trainers Curriculum Notebook, Southern Forest Research Partnership, Inc, (Athens, GA), September 2007.
31
CRS Report R40529, Biomass: Comparison of Definitions in Legislation Through the 111th Congress, by (name
redacted) and (name redacted).
32
U.S. Congress, House Committee on Energy and Commerce, H.R. 2454, The American Clean Energy and Security
Act of 2009, 111th Congress, 1st sess., passed by the House on June 26, 2009.
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To deal with the bulky nature of forest biomass, it must be condensed by chipping, grinding, or
bundling.33 Chipping is the most efficient and least expensive method, but the knife blades can be
damaged by dirt and other foreign material, which sometimes results in a preference for the
grinding method. Forest biomass in both of these forms (chipped or ground) can be stored for
several weeks but will eventually begin to decay. Bundling is the least efficient and most
expensive option; however, bundles can be stored up to nine months with only a 10% loss.34
Potential Biomass Supply
In making plans to establish commercial-scale cellulosic biofuels plants, knowledge of feedstock
supply will be particularly important. However, with no substantial history of biomass crop
production and residue collection, supply estimates cannot be based on past experience. Instead,
some estimates of supply are based on what is possible and potential. It remains to be seen
whether potential supply will accurately translate into actual supply. Figure 3 shows what types
of biomass are expected to come from different geographic regions in the United States. The
eastern half of the country boasts the potential for more types of biomass, giving plants that locate
there the option of using several types of feedstocks.
Figure 3. Expected Types of Biomass by Geographic Region in the US
Source: U.S. Department of Energy, “Breaking the Biological Barriers to Cellulosic Ethanol: A Joint Research
Agenda,” A Research Roadmap Resulting from the Biomass to Biofuels Workshop, Office of Energy Efficiency and
Renewable Energy (Rockville, MD), 2006.
Figure 4 shows the distribution of biomass throughout the United States. Biomass is most
densely located in the upper Midwest, Delta, Southeast, and Pacific Coast.
33
M. H. Pelkki, “Technological Trends and Production Costs for Forestry Biomass,” in Transition to a Bio Economy:
The Role of Extension in Energy, Farm Fdn. Conf. (Little Rock, AR), 2009, hereafter referred to as Pelkki (2009).
34
Ibid.
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Figure 4. Geographic Distribution of Biomass Resources in the United States
Source: A. Milbrandt, A Geographic Perspective on the Current Biomass Resource Availability in the United States,
Dept. of Energy, National Renewable Energy Laboratory (Golden, CO), 2005.
A 2005 study (the so-called “Billion-Ton Study”) by the DOE and USDA found that through yield
increase and the incorporation of perennial energy crops, forest and agricultural land in the United
States could produce over 1.3 billion tons of biomass per year.35 Of the 1.3 billion ton total in the
2005 study, 428 million dry tons would come from agricultural residues, 377 million dry tons
would come from perennial crops, which include grasses and short rotation woody crops, and 368
million dry tons would come from forestlands. Of the 368 million dry tons from forestlands, 63
million dry tons would come from logging residues, 147 million dry tons would come from mill
residues, and 59 million dry tons would come from forest health removals. The rest would come
from fuel wood harvests and urban wood waste. 36 The study generated considerable concern that
its estimations were overly generous and optimistic, particularly as regards the availability of crop
and forest residues and urban waste. As a result, the study is being updated, with the update
scheduled for release by the end of 2010.
Figure 5 summarizes what portion of biofuels will be produced from each type of feedstock by
the time the cellulosic biofuel industry has matured, according to the Billion-Ton Study. Crop
residues, perennial grasses, and forest residues are expected to have nearly equal shares and to
account for nearly all of biofuels production.
35
R. D. Perlack, , L. Wright, A. Turnhollow, R. Graham, B. Stokes, D. Erbach, Biomass as Feedstock for a Bioenergy
and Bioproducts Industry: The Technical Feasibility of a Billion-Ton Annual Supply, Oak Ridge National Laboratory
(Oak Ridge, TN), April 2005, hereafter referred to as Perlack et al, The Billion-Ton Study (2005).
36
Pelkki (2009); and Perlack et al, The Billion-Ton Study (2005).
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Figure 5. Projected U.S. Biofuel Sources
Other
8%
Crop
Residues
31%
Corn
6%
Forest
27%
Perennial
Crops
28%
Source: R. D. Perlack, , L. Wright, A. Turnhollow, R. Graham, B. Stokes, D. Erbach, Biomass as Feedstock for a
Bioenergy and Bioproducts Industry: The Technical Feasibility of a Billion-Ton Annual Supply, Oak Ridge National
Laboratory (Oak Ridge, TN), April 2005.
In sharp contrast to the Billion-Ton Study, the National Academy of Sciences found that with
2008 technologies and practices, a total of 416 million tons of biomass feedstocks could be
harvested and produced sustainably for biofuel production, while 548 million tons would be
available in 2020 due to more efficient use of land and increases in crop yields.37 Of that 548
million tons, 366 million tons are expected to come from residues, 164 million tons are expected
to come from dedicated energy crops, and 18 million tons are expected to come from yield
increases in hay production.
The Environmental Protection Agency (EPA) has estimated that by 2022 agricultural residues will
account for 5.7 billion gallons of cellulosic ethanol (4.9 billion gallons from corn stover), forestry
biomass will account for 0.1 billion gallons, urban waste will account for 2.3 billion gallons, and
dedicated energy crops will account for 7.9 billion gallons, for a total of 16 billion gallons.38 For
corn stover, the agency assumes that the ethanol conversion yield will be 92.3 gallons per dry ton,
which equates to 53 million dry tons of corn stover being available. If the average harvested yield
is 2 tons/acre (perhaps high), then 26.5 million acres of corn (or roughly one-third of total annual
harvested corn acres) would be harvested for stover.
37
National Academy of Engineering, National Academy of Sciences, and National Research Council, “America’s
Energy Future” Panel on Alternative Liquid Transportation Fuels, Liquid Transportation Fuels from Coal and
Biomass: Technological Status, Costs, and Environmental Impacts, Washington, DC, 2009, hereafter referred to as
NAS, Liquid Transportation Fuels from Coal and Biomass (2009).
38
U.S. Environmental Protection Agency, Renewable Fuel Standard Program (RFS2) Regulatory Impact Analysis,
EPA-420-R-10-006, Assessment and Standards Division, Office of Transportation and Air Quality, Washington, DC,
2010.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
A study based on 1997 data found that there were 36.2 million dry tons of logging residues
available in the United States.39 It was projected that this total would increase by 1.6% by 2010
and 5.1% by 2020. Additionally, a 2009 study from Purdue University found that cropland
pasture and other idled land could provide up to 92.6 million acres of land on which to grow
switchgrass and Miscanthus for cellulosic biofuels production.40 This land could produce 327
million tons of switchgrass and 833 million tons of Miscanthus, for a total of 17 billion to 53
billion gallons of potential ethanol production depending on the fraction of available land used.
These studies arrive at very different conclusions regarding the actual amount of available
biomass. BP, one of the major biofuel players in the oil industry, intends to use only dedicated
crops. BP believes dedicated crops offer greater potential for achieving the scale of production it
is seeking.41 It remains to be seen on what basis plants make their location decisions. These
decisions could be driven by feedstock availability, plant construction, or fuel distribution, just to
name a few potentially relevant considerations.
While supply estimates may indicate total availability of biomass, participation rates must also be
considered, because the presence of biomass does not guarantee that landowners and producers
will provide it to cellulosic biofuel plants. Studies have assumed participation rates ranging from
30% to 80%.42 Participation rates will likely depend on the size of the plant, the price being paid
for biomass by the plant, the cost of harvesting and collecting biomass for a producer of a given
size, and the terms of contracts with producers. Participation rates may vary across areas.
Differences in weather conditions that affect the ease of harvest also will be important.
Feedstock Production Yields
Feedstock yields have some degree of uncertainty as collection technologies and establishment
and maintenance regimens develop. Yields will vary by geographic region, soil characteristics,
and water availability. For corn stover, a distinction must be made between what is available and
what is removable. Available stover will be a function of the corn yield, while removable stover
will be a function of available stover and the percentage of stover deemed appropriate for
removal. A one-to-one ratio between corn stover and grain is usually assumed, which means there
will be approximately 56 pounds of corn stover for every bushel of corn. Based on the grain
yield, the available corn stover yield can be calculated. For example, assuming corn stover
moisture content of 15%, grain yields of 125, 150, and 175 bushels per acre will result in 2.9, 3.5,
and 4.1 dry tons of corn stover available per acre, respectively.43 Corn stover moisture content can
39
J. Gan and C. T. Smith, “Availability of logging residues and potential for electricity production and carbon
displacement in the USA,” Biomass and Bioenergy, 30(12), 2006, pp. 1011-1020.
40
W. E. Tyner, F. Taheripour, and Y. Han, Preliminary Analysis of Land Use Impacts of Cellulosic Biofuels, Argonne
National Laboratory and the California Energy Commission, 2009.
41
Personal communication by Prof. Tyner, Purdue University, with Matt Caswell, BP, undated.
42
Brechbill and Tyner (2008); R. D. Perlack and A. F. Turhollow, Assessment of Options for the Collection, Handling,
and Transport of Corn Stover, ORNL/TM-2002/44, Oak Ridge National Laboratory (Oak Ridge, TN), 2002, hereafter
referred to as Perlack and Turhollow (2002); D. R. Petrolia, “The economics of harvesting and transporting corn stover
for conversion to fuel ethanol: A case study for Minnesota,” Biomass and Bioenergy 32(7), 2008, p. 603-612, hereafter
referred to as Petrolia (2008); and T. M. Schechinger and J. Hettenhaus, Corn Stover Harvesting: Grower, Custom
Operator, and Processor Issues and Answers: Report on Corn Stover Experiences in Iowa and Wisconsin for the 199798 and 1998-99 Crop Years, ORNL/SUB-04-4500008274-01, Oak Ridge National Laboratory (Oak Ridge, TN), 1999,
hereafter referred to as Schechinger and Hettenhaus (1999).
43
D. R. Petrolia, “Economics of Crop Residues: Corn Stover,” Transition to a Bio Economy: The Role of Extension in
(continued...)
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
be estimated as a function of the grain moisture and the number of days after grain maturity.44
After initial maturity, grain moisture may be around 40% and stover moisture may be as high as
75%. However, 80 days after maturity is reached, grain moisture and stover moisture can both
converge to around 10%. Once mature, the stover moisture will decline at a faster rate than the
grain moisture. While the one-to-one stover to grain ratio is quite common, grain moisture above
18% may result in 0.8-to-one being a more realistic ratio for calculating the available corn stover
yield.45 Regardless of the stover-to-grain ratio, available corn stover will be a function of corn
yield, and removable corn stover will be a function of the removal rate. Both corn yield and the
appropriate removal rate will vary from field to field, which makes predicting the removable corn
stover yield difficult. Overall, areas where grain yields are high will also have high residue yields,
but the amount that is ultimately removed and used will depend on the ability of the producer to
harvest or collect residues and how much can be removed while still maintaining the integrity and
quality of the soil.
Perennial grasses will have lower yields in the years immediately after establishment and will
then increase to peak yield once mature. There is also the chance that seeds may remain dormant
and do not grow after planting. This will require the grasses to be planted again, which doubles
the establishment costs and delays the first harvest and the eventual peak yield. Perennial grass
yields will tend to be higher in regions where temperatures are high and winters are short, in order
to provide a longer harvest window and longer growing season.46
Forest residue yields are a function of yield from conventional logging. For hardwood stands,
20% to 40% of the initial yield can be recovered as additional residue.47 As with corn stover,
collection technology and the available resources of a given type and size of operation will
impact the amount of residue collected.
Table 2 summarizes the estimates of biomass yield from several studies in different geographic
regions. A majority of these yields are from research test plots, from small-scale producer
experiments, or based on assumptions for the region. As with yields for other crops, biomass
yields will not be uniform and constant across a given area. Much variation will depend on
weather conditions, soil types, topography, and producer expertise and experience. For corn
stover, up to 5 tons per acre could be available but not removable. Switchgrass yields are between
3 and 6 tons per acre, with yields going above that in warmer climates. Miscanthus seems to
average about 13 tons per acre on the few sites where it has been planted but will increase in
warmer climates as well. Short-rotation woody crops yield 2 to 5 tons per acre per year. Forest
residue yields are calculated as a percentage of the yield of the forest stand.
(...continued)
Energy, Farm Foundation Conference (Little Rock, AR), 2009, hereafter referred to as Petrolia (2009).
44
S. Sokhansanj, A. Turhollow, and E. Wilkerson, Development of the Integrated Biomass Supply Analysis and
Logistics Model (IBSAL), Oak Ridge National Laboratory (Oak Ridge, TN), 2008, hereafter referred to as Sokhansanj
et al. (2008).
45
L. O. Pordesimo, W. C. Edens, and S. Sokhansanj, “Distribution of above-ground biomass in corn stover,” Biomass
and Bioenergy, 26(4), 2004, pp. 337-343.
46
F. Epplin, “Alternative Energy and Agriculture: Perspectives on Cellulosic Feedstock and Cellulosic Biorefineries,”
Southern Association of Agricultural Sciences (Altanta, GA), 2009, hereafter referred to as Epplin (2009).
47
Petrolia (2009).
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Table 2. Biomass Yields by Feedstock
Location
Yield
Source (Year)
Midwest
3.6 available tons/acre
1.7 removable tons/acre
Sokhansanj and Turhollow (2002)a
IN
4.25 available tons/acre
1.6 to 3.0 removable tons/acre (depending on
harvesting technique)
Brechbill and Tyner (2008)b
Midwest
3.6 available tons/acre
1.5 removable tons/acre
Sokhansanj, Turhollow, and Perlack
(2002)c
Midwest
2.94 removable tons/acre
Quick (2003)d
IA
4 to 5 available tons/acre
1.5 to 3.5 removable tons/acre
Glassner et al. (1998)e
IA and WI
1.25 to 1.55 removable tons/acre
Schechinger and Hettenhaus (1999)f
IA
3.1 to 4.8 available tons/acre
2.2 to 3.3 removable tons/acre
Atchison and Hettenhaus (2003)g
Not location specific
3.3 available tons/acre
1.1 removable tons/acre
Perlack and Turhollow (2002)h
IA
4.4 available tons/acre
2.9 removable tons/acre
Sokhansanj et al. (2008)i
IA
4.0 tons/acre
Duffy (2008)j
OK
4.0 tons/acre
Epplin (1997)k
OK
3.75 to 6.50 tons/acre
Epplin et al. (2007)l
TN
6.45 tons/acre
Garland (2008)m
IL
2.4 tons/acre
Khanna (2008)n
IL
4.2 tons/acre
Khanna et al. (2008)o
ND, SD, NE
3.12 tons/acre
Perrin et al. (2008)p
WI
4.0 to 5.8 tons/acre
Vadas et al. (2008)q
6.17 tons/acre (implied)
U.S. EPA (2009)r
IA
4.0 tons/acre
Duffy and Nanhou (2001)s
AR
5.0 tons/acre
Popp and Hogan (2007)t
IN
5.0 tons/acre
Brechbill and Tyner (2008)
MN, ND, SD
2.0 to 4.0 tons/acre
Tiffany et al. (2006)u
ND
2.7 to 3.5 tons/acre
Bangsund et al. (2008)v
IL
4.6 tons/acre
Heaton et al. (2008)w
TN
4.3 to 8.8 tons/acre
Downing and Graham (1996)x
Southeast
7 to 16 tons/acre
Comis (2006)y
Western Corn Belt
5 to 6 tons/acre
Comis (2006)
ND
1 to 4 tons/acre
Comis (2006)
IA and IL
2.58 tons/acre
Khanna and Dhungana (2007)z
Corn Stover
Switchgrass
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Location
Yield
Source (Year)
IL
13 to 19 tons/acre
Khanna et al. (2008)
IL
13.2 tons/acre
Heaton et al. (2008)
IL
8.9 tons/acre
Khanna et al. (2008)
Europe
4.5 to 13.4 tons/acre in central and northern
Europe, up to 20 tons/acre in southern Europe
Lewandowski et al. (2003)aa
TN
5 tons/acre/year
Mercker (2007)bb
TN
2.4 to 4.3 tons/acre/year
Downing and Graham (1996)
MN
2.4 tons/acre/year
Downing (2004)cc
MN
3.8 tons/acre/year
Lazarus (2008)dd
MN
1.8 to 3.0 tons/acre/year
Updegraff, Baughman, and Taff (2004)ee
IN
5 tons/acre/year
NAS (2009)ff
NY
5 tons/acre/year
State Univ. of New York (undated)gg
20%-40% of stem wood volume from
conventional logging
Pelkki (2009)hh
Miscanthus
Poplar/Willow
Hardwood Residues
2009
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from listed sources.
a.
b.
c.
d.
e.
f.
g.
h.
i.
j.
k.
l.
S. Sokhansanj and A. Turhollow, “Baseline Cost for Corn Stover Collection,” Applied Engineering in
Agriculture, 18(5), 2002, pp. 525-530.
S. C. Brechbill and W. E. Tyner, The Economics of Biomass Collection, Transportation, and Supply to Indiana
Cellulosic and Electrical Utility Facilities, Working Paper 08-03, Department of Agricultural Economics, Purdue
University (West Lafayette, IN), April 2008.
S. Sokhansanj, A. Turhollow, and R. Perlack, “Stochastic Modeling of Costs of Corn Stover Costs Delivered
to an Intermediate Storage Facility,” American Society of Agricultural Engineers Annual International Meeting,
CIGR XVth World Congress (Chicago, IL), 2002.
G. R. Quick, “Single-Pass Corn and Stover Harvesters: Development and Performance,” Proceedings of the
International Conference on Crop Harvesting and Processing, ASABE Publication Number 701P1103e, American
Society of Agricultural and Biological Engineers (Louisville, KY), 2003.
D. A. Glassner, J. R. Hettenhaus, and T. M. Schechinger, “Corn Stover Collection Project,” BioEnergy ’98:
Expanding BioEnergy Partnerships, 1998, pp. 1100-1110.
T. M. Schechinger and J. Hettenhaus, Corn Stover Harvesting: Grower, Custom Operator, and Processor Issues and
Answers: Report on Corn Stover Experiences in Iowa and Wisconsin for the 1997-98 and 1998-99 Crop Years,
ORNL/SUB-04-4500008274-01, Oak Ridge National Laboratory (Oak Ridge, TN), 1999.
J. E. Atchison and J. R. Hettenhaus, Innovative Methods for Corn Stover Collecting, Handling, Storing and
Transporting, NREL/SR-510-33893, National Renewable Energy Laboratory (Golden, CO), March 2003.
R. D. Perlack and A. F. Turhollow, Assessment of Options for the Collection, Handling, and Transport of Corn
Stover, ORNL/TM-2002/44, Oak Ridge National Laboratory (Oak Ridge, TN), 2002.
S. Sokhansanj, A. Turhollow, and E. Wilkerson, Development of the Integrated Biomass Supply Analysis and
Logistics Model (IBSAL), Oak Ridge National Laboratory (Oak Ridge, TN), 2008.
M. Duffy, Estimated Costs for Production, Storage, and Transportation of Switchgrass, A1-22, Iowa State Univ.
(ISU) Extension, ISU (Ames, IA), 2008.
F. M. Epplin, “Cost to produce and deliver switchgrass biomass to an ethanol-conversion facility in the
southern plains of the United States,” Biomass and Bioenergy, 11(6), 1997, pp. 459-467.
F. M. Epplin, C. D. Clark, R. K. Roberts, and S. Hwang, “Challenges to the Development of a Dedicated
Energy Crop,” American Jl of Agr. Economics 85(5), 2007, pp. 1296-1302.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
m. C. D. Garland, Growing and Harvesting Switchgrass for Ethanol Production in Tennessee, University of Tennessee
Biofuels Initiative, Univ. of Tennessee (Knoxville, TN), 2008.
n. M. Khanna, “Cellulosic Biofuels: Are They Economically Viable and Environmentally Sustainable?” Choices
23(3), 2008, pp. 16-21.
o. M. Khanna, B. Dhungana, and J. Clifton-Brown, “Cost of Producing Miscanthus and Switchgrass for
Bioenergy in Illinois,”S Biomass and Bioenergy, 32(6), 2008, pp. 482-493.
p. R. Perrin, K. Vogel, M. Schmer, and R. Mitchell., “Farm-Scale Production Cost of Switchgrass for Biomass,”
Bioenergy Research Vol. 1, No. 1, 2008, pp. 91-97.
q.
P. A. Vadas, K. H. Barnett, and D. J. Undersander, “Economics and Energy of Ethanol Production from
Alfalfa, Corn, and Switchgrass in the Upper Midwest, USA,” Bioenergy Research Vol. 1, No. 1, 2008, pp. 4455.
r.
U.S. EPA, Draft Regulatory Impact Analysis: Changes to the Renewable Fuel Standard Program, EPA-420-D-09001, Office of Transportation and Air Quality, May 2009.
M. Duffy and V. Nanhou, Costs of Producing Switchgrass for Biomass in Southern Iowa, PM 1866, University
Extension, Iowa State University (Ames, IA), April 2001.
s.
t.
u.
M. Popp and J. R. Hogan, “Assessment of Two Alternative Switchgrass Harvest Transport Methods,”
Biofuels, Food, and Feed Tradeoffs, Farm Foundation Conference (St. Louis, MO), 2007.
D. G. Tiffany, B. Jordan, E. Dietrich, B. Vargo-Daggett, Energy and Chemicals from Native Grasses: Production,
Transportation and Processing Technologies Considered in the Northern Great Plains, Staff Paper P06-11,
University of Minnesota, Department of Applied Economics, College of Food, Agricultural & Natural
Resource Sciences, 2006.
v.
D. A. Bangsund, E. A. DeVuyst, and F. L. Leistritz, “Evaluation of Breakeven Farm-gate Switchgrass Prices in
South Central North Dakota,” Agribusiness and Applied Econ.s Report No. 632-S, N. Dak. St. Univ. (Fargo,
ND), Aug. 2008.
w. E. A. Heaton, , F. G. Dohleman, and S. P. Long, “Meeting US biofuel goals with less land: the potential of
Miscanthus,” Global Change Biology 14(9), Sept. 2008, pp. 2000-2014.
x. M. Downing and R. L. Graham, “The Potential Supply and Cost of Biomass From Energy Crops in the
Tennessee Valley Authority Region,” Biomass and Bioenergy 11(4), 1996, pp. 283-303.
y. D. Comis, “Switching to Switchgrass Makes Sense,” Agricultural Research, Agricultural Research Service,
USDA, 2006.
z. M. Khanna and B. Dhungana, “Economics of alternative feedstocks,” Chapter 8, Corn-based ethanol in Illinois
and the US: A Report from Department of Agricultural and Consumer Economics, University of Illinois, University of
Illinois (Urbana-Champaign, IL), 2007, pp. 129-146.
aa. I. Lewandowski, J. Scurlock, E. Lindvall, and M. Christou, “The Development and Current Status of Perennial
Rhizomatous Grasses as Energy Crops in the US and Europe,” Biomass and Bioenergy 25(4), 2003, pp. 335361.
bb. D. Mercker, Short Rotation Woody Crops for Biofuel, SP702-C, University of Tennessee Extension, University
of Tennessee Biofuels Initiative, University of Tennessee (Knoxville, TN), 2007.
cc. M. Downing, Hybrid Poplar Production in Minnesota on a Large Scale, in Agriculture as a Producer and Consumer
of Energy, Farm Foundation Conference (Arlington, Virginia), 2004.
dd. W. Lazarus, Energy Crop Production Costs and Breakeven Prices Under Minnesota Conditions, Staff Paper P08-11,
Department of Applied Economics, Univ. of Minnesota, 2008.
ee. K. Updegraff, M. J. Baughman, and S. J. Taff, “Environmental benefits of cropland conversion to hybrid
poplar: economic and policy considerations,” Biomass and Bioenergy 27(5), 2004, pp. 411-428.
ff.
National Academy of Engineering, National Academy of Sciences, and National Research Council,
“America’s Energy Future” Panel on Alternative Liquid Transportation Fuels, Liquid Transportation Fuels from
Coal and Biomass: Technological Status, Costs, and Environmental Impacts, Washington, DC, 2009.
gg. State University of New York, College of Environmental Science and Forestry, EcoWIllow, v. 1.2, undated, at
http://www.esf.edu/willow/default.htm.
hh. M. H. Pelkki, “Technological Trends and Production Costs for Forestry Biomass,” in Transition to a Bio
Economy: The Role of Extension in Energy, Farm Fdn. Conf. (Little Rock, AR), 2009.
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Production Costs
Several studies estimate the production costs of different types of biomass. These cost estimates
can vary for a wide variety of reasons. The location and timing of the study can influence the cost
of inputs, labor, and equipment. Yields will affect the number of tons over which to spread peracre costs. Many of the major differences among cost studies relate to assumptions regarding
what to exclude and include in the calculations. Explicitly identifying the assumptions and
parameters of differing studies can often explain discrepancies. No one set of assumptions and
parameters is thought to be universally correct.
Corn stover production costs primarily include collection after corn grain harvest and nutrient
replacement. What tends to make corn stover a less expensive biomass feedstock is that it is a
byproduct. All establishment costs are accounted for in corn grain production. When left on the
ground, corn stover provides protection from soil erosion and serves to retain nutrients while land
is fallow. Depending on the amount of stover removed after harvest, additional nutrients will need
to be added before planting the following year. Fertilizer costs will increase with energy costs,
which will also increase the cost of corn stover. In addition, with increasing corn yields, it may be
useful to remove part of the stover to prepare the field for crop operations the next year.
Table 3 breaks down the production costs for corn stover from several studies. The farm gate cost
per ton ranges from $12 to $67. Low estimates are often from older studies that assumed lower
fertilizer and energy costs. Some studies also did not consider nutrient replacement costs at all,
which leads to lower total costs. The total cost in some instances only considers harvest and
nutrient replacement, while other studies include a payment to the producer and assume some
storage loss.
Table 3. Corn Stover Production Costs
Payment to
Land Owner
or Farmer
($/ton)
Harvestable
Yield
(tons/acre)
Farm
Gate
Cost
($/ton)
Location
Harvest
($/ton)
Fertility
Replacement
($/ton)
Gallagher et al. (2003)a
KS
$5.96
$6.47
N/A
3.33
$12
Gallagher et al. (2003)
IA
$6.27
$6.46
N/A
3.13
$13
Glassner et al. (1998)b
IA
$14.60
N/A
$3-$15
1.5-3.0
$18-30
Sokhansanj and
Turhollow (2002)c
Midwest
$20-$22
N/A
N/A
1.7
$20-$22
Sokhansanj et al.
(2008)d
IA
$21.95
N/A
N/A
Graham et al. (2007)e
US
$18-$33
$6.50
N/A
1.4-2.3
$25-$40
Brechbill and Tyner
(2008)f
IN
$5.88
$15.64
15% of per
ton cost
1.6-3.0
$35
Perlack and Turhollow
(2002)g
Not
locationspecific
$22.30
Covered by
payment to
farmer
$10
1.1
$35-$37
IN
$23.73
$11.81
$10
2.0
$43-$46
Source (Year)
U.S. EPA (2009)h
Congressional Research Service
2.9
$24
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Source (Year)
Petrolia (2008)i and
Eidman et al. (2009)j
Location
Harvest
($/ton)
MN
$20
Fertility
Replacement
($/ton)
$4.21 for 20002004 prices
Payment to
Land Owner
or Farmer
($/ton)
Harvestable
Yield
(tons/acre)
Farm
Gate
Cost
($/ton)
$20
1.25-1.55
$53-$56
$10.64 for 2007
prices
Aden et al. (2002)k
IA
$26
$7
$10
2.2
$56
Khanna (2008)l
IL
$35.05
$8.27
$24
1.85
$67
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from listed sources.
a.
P. Gallagher, M. Dikeman, J. Fritz, E. Wailes, W. Gauther, and H. Shapouri, Biomass from Crop Residues: Cost
and Supply Estimates, Agricultural Economic Report No. 819, U.S. Department of Agriculture, Office of the
Chief Economist, Office of Energy Policy and New Uses, February 2003.
b.
D. A. Glassner, J. R. Hettenhaus, and T. M. Schechinger, “Corn Stover Collection Project,” BioEnergy ’98:
Expanding BioEnergy Partnerships, 1998, pp. 1100-1110.
c.
S. Sokhansanj and A. Turhollow, “Baseline Cost for Corn Stover Collection,” Applied Engineering in
Agriculture, 18(5), 2002, pp. 525-530.
d.
S. Sokhansanj, A. Turhollow, and E. Wilkerson, Development of the Integrated Biomass Supply Analysis and
Logistics Model (IBSAL), Oak Ridge National Laboratory (Oak Ridge, TN), 2008.
e.
R. L. Graham, R. Nelson, J. Sheehan, R. D. Perlack, and L. L. Wright., “Current and Potential US Corn
Stover Supplies,” Agronomy Journal 99(1), 2007, pp. 1-11.
f.
S. C. Brechbill and W. E. Tyner, The Economics of Biomass Collection, Transportation, and Supply to Indiana
Cellulosic and Electrical Utility Facilities, Working Paper 08-03, Department of Agricultural Economics, Purdue
University (West Lafayette, IN), April 2008.
g.
R. D. Perlack and A. F. Turhollow, Assessment of Options for the Collection, Handling, and Transport of Corn
Stover, ORNL/TM-2002/44, Oak Ridge National Laboratory (Oak Ridge, TN), 2002.
h.
U.S. EPA, Draft Regulatory Impact Analysis: Changes to the Renewable Fuel Standard Program, EPA-420-D-09001, Office of Transportation and Air Quality, May 2009.
i.
D. R. Petrolia, “The economics of harvesting and transporting corn stover for conversion to fuel ethanol: A
case study for Minnesota,” Biomass and Bioenergy 32(7), 2008, p. 603-612.
j.
V. Eidman, D. Petrolia, H. Huang, and S. Ramaswamy. The Economic Feasibility of Producing Ethanol from Corn
Stover and Hardwood in Minnesota, Staff Paper P09-3, Department of Applied Economics, University of
Minnesota, 2009.
k.
A. Aden, M. Ruth, K. Ibsen, J. Jechura, K. Neeves, J. Sheehan, B. Wallace, L. Montague, A. Slayton, and J.
Lukas, Lignocellulosic Biomass to Ethanol Process Design and Economics Utilizing Co-Current Dilute Acid
Prehydrolysis and Enzymatic Hydrolysis for Corn Stover, NREL/TP-510-32438, National Renewable Energy
Laboratory (Golden, CO), U.S. Department of Energy, June 2002.
l.
M. Khanna, “Cellulosic Biofuels: Are They Economically Viable and Environmentally Sustainable?” Choices
23(3), 2008, pp. 16-21.
Table 4 outlines the method and some assumptions used in two recent corn stover cost estimate
studies that arrive at very different estimates for the per-ton cost of corn stover. A few differences
to note include yield, nutrient replacement, storage, densification, and payment to the producer.
•
Because the Brechbill and Tyner study allows for higher removal rates, the yield
is higher, which helps decrease per-ton costs.
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•
The Eidman and Petrolia studies do not include nitrogen costs in nutrient
replacement, because they assume a corn-soybean rotation.
•
The Brechbill and Tyner study assumes bales of stover will be stored along the
edge of the field until needed by the plant, while the Eidman and Petrolia studies
assume that bales are transported to a regional storage facility and sometimes
even stored under roof. The additional transportation and the construction of a
storage facility serve to increase per-ton costs.
•
The Eidman and Petrolia studies also allow for the possibility of densification
just before the stover is transported to the plant. This serves to increase the
density of the stover and reduce transportation costs by allowing more to be
loaded onto each truck. The Brechbill and Tyner study did not consider this and
assumed that stover would be hauled to the plant in bale form.
•
Finally, Brechbill and Tyner provide a payment to the producer that is 15% of the
cost of production. In the case of corn stover, this is approximately $5 per dry
ton. The Eidman and Petrolia studies pay $20 per dry ton.
Table 4. Assumptions and Parameters Used in Two Corn Stover Cost Studies
Sources
Item
Brechbill and Tyner (2008)a
Petrolia (2008),b Petrolia (2009),c and
Eidman et al. (2009)d
Location
Indiana
Minnesota, Iowa, South Dakota
Yield
4.25 available tons per acre with 1.6 to 3.0
removable tons per acre
One-to-one stover to grain ratio, grain
yields vary depending on the specific site,
approximately 1.3 to 1.6 removable tons
per acre
Nutrient
replacement
Replace nitrogen, phosphorus, and potassium at
a cost of $15.64 per ton of stover removed
Replace phosphorus and potassium at a cost
of $4.21 per ton of stover removed based
on 2000 to 2004 average fertilizer prices
and $10.64 per ton of stover removed
based on 2007 fertilizer prices
Participation rate
50% and 75%
50%
Harvest method
Baling only, raking and baling, or shredding,
raking, and baling
Baling only and shredding, raking, and baling
Equipment
Owned equipment for farm sizes of 500, 1,000,
1,500, and 2,000 acres or custom hired
operators
Purchased shredder, rake, baler, bale picker,
and telehandler
Removal rate
38% for baling only, 52.5% for raking and baling,
and 70% for shredding, raking, and baling
30% when using round bales, 40% when
using square bales
Baling
1,000 pound round bales wrapped in either
twine, net wrap, or plastic wrap
880 pound round bales wrapped in plastic
mesh and 1,598 pound rectangular bales
wrapped in twine
Storage
Bales stored at the edge of the field until needed
by the plant, storage premium paid after six
months of storage
Round bales stored outdoors since
wrapped with plastic, rectangular bales
stored indoors
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Sources
Item
Brechbill and Tyner (2008)a
Petrolia (2008),b Petrolia (2009),c and
Eidman et al. (2009)d
Dry matter loss
Depends on method used to bale the stover,
3.13% per month of storage when using twine,
1.4% per month of storage when using net wrap,
1.025% per month of storage when using plastic
wrap
2% storage loss for both types of bales
Densification
Not applicable
Densification facility is located next to the
central storage facility and densification
would take place immediately before stover
is taken to the plant. Results in significant
cost reduction in transportation of round
bales and only slight cost reduction in
transportation of rectangular bales.
Transportation
Flatbed semi-trucks, owned equipment for farm
sizes of 500, 1,000, 1,500, and 2,000 acres or
custom hired operators, bales transported
directly from the edge of the field to the plant
when requested by the plant
Bales transported via flatbed semi-truck
from the edge of the field to a central
storage facility
Payment to
producer
15% of the per ton product cost
$20 per dry ton
Farm gate cost
(not including
transport)
$35 per dry ton
Approximately $53 per dry ton for
rectangular bales, $56 per dry ton for round
bales, and $76 per dry ton when densified
Transportation
13 dry tons per loaded trailer
22.4 dry tons per loaded trailer with
rectangular bales
$2.60 per loaded mile
$0.20 per mile per dry ton
11.9 dry tons per loaded trailer with round
bales
For a 13 dry ton load travelling 25 miles, $5.00
per dry ton in total transportation cost
23 dry tons per loaded trailer with
densification
$2.82 per loaded mile for 0 to 25 miles
$2.22 per loaded mile for 26 to 100 miles
$1.96 per loaded mile for over 100 miles
For rectangular bales travelling 25 miles,
$3.15 per dry tons in total transportation
cost
For round bales travelling 25 miles, $5.92
per dry tons in total transportation cost
For densified bales travelling 25 miles, $3.07
per dry tons in total transp. cost
Total delivered
cost
$40 per dry ton
(25 miles)
$56.15 per dry ton (rectangular bales)
$61.92 per dry ton (round bales)
$79.07 per dry ton (densified)
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from listed sources.
a.
S. C. Brechbill and W. E. Tyner, The Economics of Biomass Collection, Transportation, and Supply to Indiana
Cellulosic and Electrical Utility Facilities, Working Paper 08-03, Department of Agricultural Economics, Purdue
University (West Lafayette, IN), April 2008.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
b.
D. R. Petrolia, “The economics of harvesting and transporting corn stover for conversion to fuel ethanol: A
case study for Minnesota,” Biomass and Bioenergy 32(7), 2008, p. 603-612.
c.
D. R. Petrolia, “Economics of Crop Residues: Corn Stover,” Transition to a Bio Economy: The Role of Extension
in Energy, Farm Foundation Conference (Little Rock, AR), 2009.
d.
V. Eidman, D. Petrolia, H. Huang, and S. Ramaswamy. The Economic Feasibility of Producing Ethanol from Corn
Stover and Hardwood in Minnesota, Staff Paper P09-3, Department of Applied Economics, University of
Minnesota, 2009.
Even without seeing the exact calculations involved in each of these studies, breaking down the
assumptions of the studies can help determine the source of differences in total costs. This same
exercise can be done with switchgrass studies, and differences in land rent, establishment,
maintenance, harvest, and storage can account for major total cost differences.
Perennial grasses production costs are comprised of both one-time establishment and annual
maintenance costs. Yields for these grasses may take up to three years to reach their peak, which
results in high costs and low benefits initially. Growing perennial grasses is also a relatively longterm commitment of resources. Deciding to plant perennial grasses means harvesting each year
for the life of the stand.
Table 5 breaks down the production costs for switchgrass from several studies. The farm gate
cost per ton ranges from $23 to $114. A major factor in the difference among the estimates is the
assumed yield, which for the studies mentioned below ranges from 2.4 to 8.8 tons per acre.
Another factor accounting for differences in switchgrass production costs is assumptions made
regarding land rent. Some studies assume that no land rent is included, some include rent for
pastureland or marginal cropland, and others include rent for cropland that might also be used to
grow corn or soybeans.
Table 5. Switchgrass Production Costs
Source (Year)
Location
Land
Cost
($/acre)
Epplin (1997)a
OK
$30
Downing and
Graham (1996)b
TN
Various
Epplin et al. (2007)c
OK
$60
Perrin et al. (2008)d
ND, SD, NE
Various
Bangsund et al.
(2008)e
ND
$0
Not specified
Khanna et al. (2008)f
IL
$0
Large rectangular bales
4.2
$52
Mooney et al.
(2008)g
TN
$100
Large round bales
8.83
$53
Brechbill and Tyner
(2008)h
IL
$70
Large round bales
5.0
$55
Garland (2008)i
TN
$0
Large round bales
6.45
$62
Ferland (2001)j
GA
$20
Not specified
6.0
$66
Carpenter and Mees
(2008)k
MO
$33
Not specified
4.5
$86
Congressional Research Service
Harvest Method
Harvestable
Yield
(tons/acre)
Farm-Gate
Cost ($/ton)
Large round bales
4.0
$23
Not specified
4.3-8.8
$28 to $64
Large rectangular bales
3.75-6.5
$37-$53
Large round bales
3.12
$42-$71
2.7-3.5
$47 to $76
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Location
Land
Cost
($/acre)
Khanna (2008)l based
on calculations by
Epplin (2009)m
IL
$77
Not specified
2.4
$113 (includes
foregone profits
from a corn and
soybean rotation)
Duffy (2008)n
IA
$80
Large square bales
4.0
$114 (includes
transportation to
storage, storage in
a building, and
transportation to
the plant)
Source (Year)
Harvest Method
Harvestable
Yield
(tons/acre)
Farm-Gate
Cost ($/ton)
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from listed sources.
a.
F. M. Epplin, “Cost to produce and deliver switchgrass biomass to an ethanol-conversion facility in the
southern plains of the United States,” Biomass and Bioenergy, 11(6), 1997, pp. 459-467.
b.
M. Downing and R. L. Graham, “The Potential Supply and Cost of Biomass From Energy Crops in the
Tennessee Valley Authority Region,” Biomass and Bioenergy 11(4), 1996, pp. 283-303.
c.
F. M. Epplin, C. D. Clark, R. K. Roberts, and S. Hwang, “Challenges to the Development of a Dedicated
Energy Crop,” American Jl of Agr. Economics 85(5), 2007, pp. 1296-1302.
d.
R. Perrin, K. Vogel, M. Schmer, and R. Mitchell., “Farm-Scale Production Cost of Switchgrass for Biomass,”
Bioenergy Research Vol. 1, No. 1, 2008, pp. 91-97.
e.
D. A. Bangsund, E. A. DeVuyst, and F. L. Leistritz, “Evaluation of Breakeven Farm-gate Switchgrass Prices in
South Central North Dakota,” Agribusiness and Applied Econ.s Report No. 632-S, N. Dak. St. Univ. (Fargo,
ND), Aug. 2008.
f.
M. Khanna, B. Dhungana, and J. Clifton-Brown, “Cost of Producing Miscanthus and Switchgrass for
Bioenergy in Illinois,” Biomass and Bioenergy, 32(6), 2008, pp. 482-493.
g.
D. F. Mooney et al., “Switchgrass Production in Marginal Environments: A Comparative Economic Analysis
across Four West Tennessee Landscapes,” selected paper, American Agricultural Economics Association Annual
Meeting, Orlando, FL, 2008.
h.
S. C. Brechbill and W. E. Tyner, The Economics of Biomass Collection, Transportation, and Supply to Indiana
Cellulosic and Electrical Utility Facilities, Working Paper 08-03, Department of Agricultural Economics, Purdue
University (West Lafayette, IN), April 2008.
i.
C. D. Garland, Growing and Harvesting Switchgrass for Ethanol Production in Tennessee, University of Tennessee
Biofuels Initiative, Univ. of Tennessee (Knoxville, TN), 2008.
j.
C. Ferland, “Switchgrass for Co-generation Fuel Feasibility,” University of Georgia, Center for Agribusiness
and Economic Development, Dept. of Agricultural and Applied Economics, University of Georgia (Athens,
GA), 2001.
k.
B. Carpenter and M. Mees, “Bale, Silage, and Bio-energy, Projected Budgets for 2009,” Agricultural Electronic
Bulletin Board, University of Missouri Extension, 2008.
l.
M. Khanna, “Cellulosic Biofuels: Are They Economically Viable and Environmentally Sustainable?” Choices
23(3), 2008, pp. 16-21.
m. F. Epplin, “Alternative Energy and Agriculture: Perspectives on Cellulosic Feedstock and Cellulosic
Biorefineries,” Southern Association of Agricultural Sciences (Altanta, GA), 2009.
n.
M. Duffy, Estimated Costs for Production, Storage, and Transportation of Switchgrass, A1-22, Iowa State Univ.
(ISU) Extension, ISU (Ames, IA), 2008.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Table 6 lists production cost estimates for Miscanthus from a study conducted at the University
of Illinois, the primary location in the United States where Miscanthus research is being
conducted. Presently, there is not a significant amount of production cost estimates for
Miscanthus, but many of the same points hold as with switchgrass. This study finds that
Miscanthus will cost $38 per ton, which is closer to estimates for corn stover than for switchgrass.
The major difference relative to switchgrass is the substantially higher yields, which lead to a
lower per-ton cost for Miscanthus.
Table 6. Miscanthus Production Costs
Source (Year)
Location
Land Cost
($/acre)
Harvest Method
Harvestable
Yield (tons/acre)
Farm-Gate
Cost ($/ton)
Khanna et al. (2008)a
IL
$0
Large rectangular bales
13-19
$38
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from listed source.
a.
M. Khanna, B. Dhungana, and J. Clifton-Brown, “Cost of Producing Miscanthus and Switchgrass for
Bioenergy in Illinois,” Biomass and Bioenergy, 32(6), 2008, pp. 482-493.
Short-rotation woody crops are similar to perennial grasses in the way they are produced. A
majority of the cost is incurred in site preparation, in establishment, and in those years when
harvest takes place. Harvest, however, does not take place annually.
Table 7 summarizes the production costs for short-rotation woody crops. Total costs will depend
on what yield is achieved and the type of land on which trees are established.
Table 7. Short-Rotation Woody Crop Production Costs
Source (Year)
Location
Land
Cost
($/acre)
Harvest
Method
Harvestable
Yield
(tons/acre/yr)
Downing and
Graham (1996)a
TN
Various
$17
2.4 to 4.3
$29-$46 on former cropland,
$44-$63 on former pasture
State Univ. of New
York (2008)
NY
$35
$15.10
5
$52 for 13 yr rotation,
Han (2009)
IN
$90
$15.05
5
$57
Lazarus (2008)b
MN
$40
Not specified
3.8
$63
Farm-Gate Cost ($/ton)
$47 for 22 yr rotation
Source: Compiled by Tyner, Brechbill, and Perkis, Purdue University, August 2010, from listed sources.
a.
M. Downing and R. L. Graham, “The Potential Supply and Cost of Biomass From Energy Crops in the
Tennessee Valley Authority Region,” Biomass and Bioenergy 11(4), 1996, pp. 283-303.
b.
W. Lazarus, Energy Crop Production Costs and Breakeven Prices Under Minnesota Conditions, Staff Paper P08-11,
Department of Applied Economics, Univ. of Minnesota, 2008.
Table 8 outlines costs associated with processing forest residues that come directly from the
forest. This only includes harvesting to make the forest residues more uniform and does not
include transportation costs.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Table 8. Forest Residue Production Rates and Costs
Technology
Production Rates
Cost per Green Ton
Approximate Cost per
Dry Ton
Chipping
300-400 tons/day
$8-$12
$11.60-$17.40
Grinding
250-325 tons/day
$10-$12
$14.50-$17.40
Bundling/Baling
100-200 tons/day
$12-$20
$17.40-$29.00
Source: M. H. Pelkki, “Technological Trends and Production Costs for Forestry Biomass,” in Transition to a Bio
Economy: The Role of Extension in Energy, Farm Fdn. Conf. (Little Rock, AR), 2009.
Notes: These costs are cited in terms of green tons. A dry ton will have a moisture content of less than 10%,
while a green ton will have a moisture content of 40% to 50% just after harvest. Dry ton costs shown above
assume 45% moisture content.
Capital investments for systems to harvest and process forest residues are estimated to cost
between $800,000 and $1,200,000.48 Another study from Minnesota found the delivered cost of
hardwood residue to be $40.37 per dry ton plus the cost of transportation.49
Two Alternate Cost Studies From 2009
The Idaho National Laboratory and the National Academy of Sciences released studies in 2009
that provide a different perspective and a more comprehensive assessment of feedstock costs.
This section summarizes and assesses these studies.
Idaho National Laboratory Monte Carlo Simulation Results
The Idaho National Laboratory50 looks at three feedstock supply systems; one system produces a
non-uniform feedstock51 and the other two systems produce uniform feedstocks.52 In order to
compare to the other cost estimates already cited, Table 9 outlines the estimates for the major
components of a conventional production process with a non-uniform feedstock for both corn
stover and switchgrass. This production technology is meant to represent technology that is
available today and suggests that switchgrass costs about $50 per dry ton compared with about
$55 per dry ton for corn stover.
48
Pelkki (2009).
V. Eidman, D. Petrolia, H. Huang, and S. Ramaswamy. The Economic Feasibility of Producing Ethanol from Corn
Stover and Hardwood in Minnesota, Staff Paper P09-3, Department of Applied Economics, University of Minnesota,
2009, hereafter referred to as Eidman et al. (2009).
50
Bioenergy Program, U.S. Department of Energy, Idaho National Laboratory (INL; Idaho Falls, ID), at
https://inlportal.inl.gov/portal/server.pt/community/bioenergy/421/bioenergy_main_page.
51
J. R. Hess, K. L. Kenney, C. T. Wright, R. Perlack, and A. Turhollow, Corn Stover Availability for Biomass
Conversion: Situation Analysis, INL/JOU-09-15666, Idaho National Laboratory (Idaho Falls, ID), 2009.
52
J. R. Hess, C. T. Wright, K. L. Kenney, and E. M. Searcy, Uniform-Format Bioenergy Feedstock Supply System
Design Report Series: Commodity-Scale Production Of An Infrastructure-Compatible Bulk Solid From Herbaceous
Lignocellulosic Biomass, “Volume A: ‘Uniform-Format’ Vision and Conventional-Bale Supply System,” Table-2.2,
NL/EXT-09-17527DRAFT, Idaho National Laboratory (Idaho Falls, ID), April 2009, p. 26; hereafter referred to as
Hess et al. (2009).
49
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Table 9. Conventional Non-Uniform Feedstock Production Costs ($/dry ton)
Biomass Type
Harvest and
Collection
Storage
Handling and
Transport
Receiving and
Preprocessing
Average
Total Cost
Corn Stover
$21.61 ± $2.69
$8.11 ± $0.66
$11.93 ± $1.25
$13.74 ± $1.31
$55.39
Switchgrass
$14.92 ± $1.45
$7.08 ± $0.52
$14.13 ± $1.43
$13.47 ± $1.30
$49.60
Source: J. R. Hess, C. T. Wright, K. L. Kenney, and E. M. Searcy, Uniform-Format Bioenergy Feedstock Supply
System Design Report Series: Commodity-Scale Production Of An Infrastructure-Compatible Bulk Solid From Herbaceous
Lignocellulosic Biomass, “Volume A: ‘Uniform-Format’ Vision and Conventional-Bale Supply System,” Table-2.2,
NL/EXT-09-17527DRAFT, Idaho National Laboratory (Idaho Falls, ID), April 2009.
Note: Data presented as (Mean Value) +/- (Standard Deviation) were derived from Monte Carlo simulation of a
stochastic model. The average cost for a biomass type is the sum of mean values across the four categories.
National Academy of Sciences Feedstock Costs
The National Academy of Sciences report53 has estimated biofuel feedstock costs based to some
degree on parameters used in the literature and to some degree on expectations about demand for
biomass in a mature industry. These estimates are intended to represent the willingness-to-accept
price for the last delivered dry ton of biomass and are assumed to be equivalent to the marginal
cost of production for the last ton. With an upward sloping marginal cost curve, each additional
ton of biomass costs more than the previous ton due to increasing transportation costs. A plant
will likely contract its supply and cover the transportation costs, and each producer will receive
the farm-gate price, regardless of their distance from the plant. It is assumed that these prices will
apply to a mature industry that demands 500 million tons of biomass per year. Assuming a yield
of 70 gallons per ton, this will equate to a 35 billion gallon cellulosic biofuel industry. This
suggests that plants will have larger capacities and demand biomass from much further distances
than currently planned plants or those that will first emerge on a commercial scale.
The National Academy of Sciences panel expects that feedstock costs will decline over time with
improvements in crop yields, land management, and logistics, such as handling, storage, and
transportation. Cost estimates were done for corn stover, switchgrass, Miscanthus, prairie grasses,
woody biomass, and wheat straw. Overall, the total feedstock costs determined by the National
Academy of Sciences study are higher than most of those predicted in the literature. The
following discussion attempts to break down these costs to determine how they were calculated
and what portions of the total costs are particularly higher than expected.
Estimates for corn stover, switchgrass, Miscanthus, and woody biomass are presented in the
following four tables (Table 10, Table 11, Table 12, and Table 13). Where applicable, cost
estimates include establishment and seeding, nutrient replacement, harvesting and maintenance,
storage, chipping, transportation, stumpage fees, and land and opportunity costs.
The results are presented for six estimated ranges: an estimate based on the current literature
followed by a low, 50% low (i.e., average of “low” and “baseline”), baseline, 50% high (i.e.,
average of “high” and “baseline”), and high estimates. The baseline estimate is treated as the
midpoint of the range of estimates, whereas the low and high cost scenarios are considered the
best case and worse case scenarios, respectively. The 50% low and 50% high estimates are
thought to be a more reasonable range. Baseline estimates are considered to be cost estimates for
2008, while the 50% low estimates are considered to apply to 2020.
53
NAS, Liquid Transportation Fuels from Coal and Biomass (2009).
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Table 10. Willingness-to-Accept Corn Stover Price per Ton
Literature
Estimate
Low
50% Low
Baseline
50% High
High
Yield
2 to 3 tons/acre
2.5 tons/acre
2.25 tons/acre
2 tons/acre
1.75 tons/acre
1.5 tons/acre
Nutrient Replacement
$4 to $21/ton
$10/ton
$12.50/ton
$15/ton
$17.50/ton
$20/ton
Harvesting and Maintenance
Up to $35/ton
$40/ton
$42.50/ton
$45/ton
$47.50/ton
$50/ton
Storage
$2 to $17/ton
$10/ton
$12.50/ton
$15/ton
$17.50/ton
$20/ton
Transportation
$0.09 to $0.63/tn/mi
or 22 to 67 miles
$0.25/tn/mi for
20 miles = $5/ton
$0.30/tn/mi for
25 miles= $7.50/ton
$0.35/tn/mi for
30 miles=$0.50/ton
$0.40/tn/mi for
35 miles= $14/ton
$0.45/tn/mi for
40 miles= $18/ton
Cropland Rental Rates
$0 to $143 per acre
$0/ac = $0/ton
$25/ac = $11/ton
$50/ac = $25/ton
$75/ac = $43/ton
$100/ac = $67/ton
Total Cost ($/ton)
$65
$86
$110
$140
$175
Source: National Academy of Engineering, National Academy of Sciences, and National Research Council, “America’s Energy Future” Panel on Alternative Liquid
Transportation Fuels, Liquid Transportation Fuels from Coal and Biomass: Technological Status, Costs, and Environmental Impacts, chapter 2, “Biomass Resources for Liquid
Transportation Fuels,” Washington, DC, 2009.
Table 11. Willingness-to-Accept Switchgrass Price per Ton
Literature Estimate
Low
50% Low
Baseline
50% High
High
Yield
0.89 to 9.8 ton/acre
6 ton/acre
5 ton/acre
4 ton/acre
3 ton/acre
2 ton/acre
Establishment and Seeding
$30 to $200/acre
converted to $/ton
$75/acre =
$12.50/ton
$87.50/ac =
$17.50/ton
$100/ac = $25/ton
$112.50/ac =
$37.50/ton
$125/ac =
$62.50/ton
Nutrient Replacement
$4 to $21/ton
$5/ton
$7.50/ton
$10/ton
$12.50/ton
$15/ton
na
$35/ton
$37.50/ton
$40/ton
$42.50/ton
$45/ton
$2 to $17/ton
$10/ton
$12.50/ton
$15/ton
$17.50/ton
$20/ton
$0.09 to $0.63/ tn/mi
for 22 to 67 miles
$0.25/tn/mi for
20 miles = $5/ton
$0.30/tn/mi for
25 miles=$7.50/ton
$0.35/tn/mi for
30 miles=$10.50/ton
$0.40/tn/mi for
35 miles=$14/ton
$0.45/tn/mi for
40 miles=$18/ton
$76 to $230/acre
$150/ac = $25/ton
$175/ac = $35/ton
$200/ac = $50/ton
$225/ac =$75/ton
$250/ac = $125/tn
Harvesting and Maintenance
Storage
Transportation
Cropland Rental Rates
Total Cost ($/ton)
$93
$118
$151
$199
$286
Source: National Academy of Engineering, National Academy of Sciences, and National Research Council, “America’s Energy Future” Panel on Alternative Liquid
Transportation Fuels, Liquid Transportation Fuels from Coal and Biomass: Technological Status, Costs, and Environmental Impacts, chapter 2, “Biomass Resources for Liquid
Transportation Fuels,” Washington, DC, 2009.
Notes: na = not available.
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Table 12. Willingness-to-Accept Miscanthus Price per Ton
Literature Estimate
Low
50% Low
Baseline
50% High
High
3.4 to 17.8 tons per ac
12 ton/acre
10.5 ton/acre
9 ton/acre
7.5 ton/acre
6 ton/acre
$43 to $350 per ac
$175/ac=$14.58/ton
$200/ac= $19.05/ton
$225/ac = $25/ton
$250/ac=$33.33/ton
$275/ac=$45.83/ton
$4 to $21/ton
$5/ton
$7.50/ton
$10/ton
$12.50/ton
$15/ton
na
$35/ton
$37.50/ton
$40/ton
$42.50/ton
$45/ton
$2 to $17/ton
$10/ton
$12.50/ton
$15/ton
$17.50/ton
$20/ton
Transportation
$0.09 to $0.63/ton/mile
for 22 to 67 miles
$0.25/ton/mile for
20 miles = $5/ton
$0.30/ton/mile for
25 miles = $7.50/ton
$0.35/ton/mile for
30 miles=$10.50/ton
$0.40/ton/mile for
35 miles = $14/ton
$0.45/ton/mile for
40 miles = $18/ton
Cropland Rental Rates
$76 to $230 per acre
$150/ac= $25/ton
$175/ac = $35/ton
$200/ac = $50/ton
$225/ac = $75/ton
$250/ac =$125/ton
Yield (tons/ acre)
Establishment and Seeding
Nutrient Replacement
Harvesting and Maintenance
Storage
Total Cost ($/ton)
$82
$101
$123
$150
$186
Source: National Academy of Engineering, National Academy of Sciences, and National Research Council, “America’s Energy Future” Panel on Alternative Liquid
Transportation Fuels, Liquid Transportation Fuels from Coal and Biomass: Technological Status, Costs, and Environmental Impacts, chapter 2, “Biomass Resources for Liquid
Transportation Fuels,” Washington, DC, 2009.
Table 13. Willingness-to-Accept Woody Biomass Price per Ton
Literature Estimate
Low
50% Low
Baseline
50% High
High
na
$35/ton
$37.50/ton
$40/ton
$42.50/ton
$45/ton
Storage
$2 to $17/ton
$0/ton
$5/ton
$10/ton
$15/ton
$20/ton
Chipping
na
$8/ton
$9/ton
$10/ton
$11/ton
$12/ton
$0.09 to $0.63 /ton/mile
for 22 to 67 miles
$0.40/ton/ mile for
40 miles= $16/ton
$0.45/ton/mile for
45 miles=$20.25/ton
$0.50/ton/ mile for
50 miles= $25/ton
$0.55/ton/ mile for
60 miles= $33/ton
$0.60/ton/ mile for
70 miles= $42/ton
na
$0/ton
$0/ton
$0/ton
$2.50/ton
$5/ton
$59
$72
$85
$104
$124
Harvesting and Maintenance
Transportation
Stumpage
Total Cost ($/ton)
Source: National Academy of Engineering, National Academy of Sciences, and National Research Council, “America’s Energy Future” Panel on Alternative Liquid
Transportation Fuels, Liquid Transportation Fuels from Coal and Biomass: Technological Status, Costs, and Environmental Impacts, chapter 2, “Biomass Resources for Liquid
Transportation Fuels,” Washington, DC, 2009.
Notes: na = not available.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Corn stover costs (Table 10) can be compared to those in Table 3. The highest nutrient
replacement value found in the literature was around $15 per ton, but it is the baseline value in
the National Academy study. The highest harvest cost found in the literature was around $35 per
ton, but this is below the low cost value in this study. Compared to harvest and maintenance costs
for switchgrass and Miscanthus, corn stover costs are assumed to be slightly higher due to
requiring additional labor at the same time as grain harvest, which is likely an overstatement since
most stover would be harvested after grain. In addition, land rent is included for corn stover as the
opportunity cost of land, but since corn stover is a byproduct of corn, the land rent should not be
applied to corn stover.
Switchgrass (Table 11) and Miscanthus (Table 12) costs can be compared to those in Table 5 and
Table 6, respectively. The land rent/opportunity cost is assumed to be between $150 and $250 per
acre. While some perennial grasses may be planted on land that might also be used for corn or
soybeans, it is expected that most grasses will initially be planted on more marginal land or
pasture land, which likely would have substantially lower land rents. As a result, these land rent
costs seem unreasonably high. Storage costs are mostly within the range estimated in the
literature. Transportation distances may be slightly higher since assumptions regarding demand
are for a mature industry.
Supply Logistics
Low Energy Density Concerns
Some biomass feedstocks, such as agricultural residues and perennial grass feedstocks, have
relatively low energy density, which can make transportation more costly, because a limited
number of bales can be made to fit on a load. Because trucks become physically full when
hauling biomass before reaching their weight limits, more truckloads would be required for
cellulosic biofuel production relative to corn-based ethanol, thus making the per-unit cost much
higher for cellulosic feedstocks then for corn. In addition, the greater number of trucks required to
transport cellulosic feedstocks might also impose a heavy burden on rural transportation
infrastructure.54 Processing biomass before it goes to the plant will make it denser and less costly
to transport by allowing more biomass per load (especially in the case of round bales), and it will
be easier to handle once it arrives at the plant.55 However, densification costs have been estimated
at about $23 per dry ton, which may outweigh any savings related to transportation, especially if
densification cannot take place immediately after harvest.56 Densification at the storage facility
would require the biomass to be transported as bales from the field and then stored until
densification could take place.
Low energy density also means that a large volume of biomass would be needed by a plant to
meet demand. For example, a 50 million gallon per year cellulosic ethanol plant would need a 90feet-high pile of corn stover covering 100 acres of land in order to stay operational for a year.57
54
C. W. Rismiller and W. E. Tyner, “Transportation Infrastructure Implications of Development of a Cellulosic
Biofuels Industry for Indiana,” Journal of the Transportation Research Forum 49(1), 2010, pp. 95-112.
55
Petrolia (2009).
56
Ibid.
57
S. R. Schill, “Collecting Mountains of Stover,” Ethanol Producer Magazine, 2007.
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Using a larger quantity of feedstock to make the same amount of fuel can make storage,
transportation, and just-in-time delivery to plants more difficult and less efficient.
Harvest Timing Concerns
The timing of biomass harvest for particular feedstocks can have logistical advantages and
disadvantages. For example, short-rotation woody crops can be harvested year-round, which
helps ease the burden of storage because the biomass can be left on the stump until it is needed.
However, the year-round harvest required to use the stump as storage may be difficult should
weather or equipment failures delay any regularly scheduled harvests. In contrast, corn stover
should be harvested within three weeks after corn is harvested and before any snow might cover
the field, which gives it a harvest window of about five weeks to three months, depending on the
location.58 This may require additional equipment and labor so as to not interfere with the corn
harvest. Perennial grasses, on the other hand, can have harvest windows of up to 8 months
depending on location. 59 Miscanthus must be harvested after the first frost in order to take
advantage of nitrogen retention through the root system.60
Because corn stover harvest is concentrated during one part of the year, long-term storage will be
needed to hold the corn stover until the plant is ready to use it (keeping in mind that biofuels
plants are designed to run year-round). For plants that can eventually use multiple feedstocks,
they will be able to use corn stover around the time it is harvested, followed by feedstocks that
become available at other times of the year.
Storage Concerns
Storage infrastructure for more dense crops, including grains and oilseeds, is available on many
larger farms and at centralized elevator facilities. Large quantities of corn, for example, can be
dried to a certain moisture content and stored for an extended period of time in a relatively small
space. No such storage system or infrastructure currently exists for cellulosic biomass.
Forest biomass is attractive from a storage perspective, because it can be stored on the stump until
needed and, depending on the climate and geography of its location, it can be harvested year
round.61 However, with the harvest of agricultural residues and perennial grasses being somewhat
dependent on timing in the season, harvest cannot coincide with demand for biomass, which will
require transportation and delivery to be tailored to the needs of the plant.
Between harvest and delivery, on-site storage of the biomass will be necessary. Storage conditions
will vary from producer to producer and from region to region depending on weather conditions.
While being stored, especially in outdoor condition, biomass can lose dry matter. Avoiding dry
matter loss while storing biomass outside will depend on humidity and precipitation levels.
Individual producers will likely be expected to store their own biomass until the plant needs it,
which could be several months after it is harvested. With no central storage facility and producers
58
Petrolia (2009); and J. Cundiff, “Biomass Logistics in the Southeast,” Transition to a Bio Economy: The Role of
Extension in Energy, Farm Foundation Conference (Little Rock, AR), 2009, hereafter referred to as Cundiff (2009).
59
Cundiff (2009).
60
S. R. Schill, “Miscanthus versus Switchgrass,” Ethanol Producer Magazine, 2007.
61
Cundiff (2009).
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not likely to have storage specifically to keep the feedstock until the plant needs it, biomass may
be stored outside on the ground.
For biomass that is baled, the packaging method, whether it is with twine, net wrap, or plastic
wrap, can affect the amount of dry matter loss. Ideally, corn stover bales should at least be stored
on a site with good drainage, a concrete or gravel surface, and under cover or inside if not
wrapped with plastic.62 Depending on the conditions, and on assumptions regarding dry matter
loss, where biomass is stored, and the form in which it is stored, storage costs will vary. A study
focused on corn stover found that storage adds between $7 and $13 per dry ton.63
For baled biomass, the choice between round bales and square bales depends on several
conditions. One study found that round bales require less expensive equipment and a lower power
tractor. They can be left in the field after harvest and brought to the storage facility later. Their
round tops allow water to run off, which helps decrease dry matter loss. Round bales can be
stored up to six months in satellite storage locations with less than 5% loss. Cost of storage is $2
per ton for round bales compared to $8 per ton for square bales. 64 In contrast, another study found
that using rectangular bales will reduce harvest and storage costs as the rectangular baler is able
to bale more per hour that a round baler. However, rectangular bales have increased dry matter
losses compared to round bales, so that the optimal solution may be a combination of different
harvest and storage techniques. 65 Table 14 shows estimated dry matter loss for switchgrass based
on the type of bale, how it is covered, and the length of time it is stored. Each type of bale was
stored on well-drained ground, gravel, and wooden pallets.66 Overall, it is suggested that for
biomass processed immediately after harvest, rectangular bales should be used, while for biomass
that must be stored for more than three months, round bales with tarps should be used.
Table 14. Switchgrass Dry Matter Loss by Bale Type and Cover System
Bale Type
Cover System
100 days
200 days
300 days
400 days
Round
None
6.0%
15.7%
14.0%
9.7%
Round
Tarp
0.0%
6.1%
4.6%
7.0%
Rectangular
None
27.2%
52.5%
52.1%
64.8%
Rectangular
Tarp
25.7%
20.8%
12.5%
13.7%
Source: B. C. English and D. F. Mooney, “Economics of the Switchgrass Supply Chain: Enterprise Budgets and
Production Cost Analyses,” Transition to a Bio Economy: The Role of Extension in Energy, Farm Foundation
Conference (Little Rock, AR), 2009.
62
Petrolia (2009).
Ibid.
64
Cundiff (2009).
63
65
B. C. English and D. F. Mooney, “Economics of the Switchgrass Supply Chain: Enterprise Budgets and Production
Cost Analyses,” Transition to a Bio Economy: The Role of Extension in Energy, Farm Foundation Conference (Little
Rock, AR), 2009, hereafter referred to as English and Mooney (2009); and C. Wang, J. Larson, B. English, and K.
Jensen, “Cost Analysis of Alternative Harvest, Storage and Transportation Methods for Delivering Switchgrass to a
Biorefinery from the Farmers’ Perspective,” selected paper, Southern Association of Agricultural Sciences Annual
Meeting (Altanta, GA), 2009, hereafter referred to as Wang et al. (2009).
66
Wang et al. (2009).
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Research is being conducted to develop storage systems that keep the biomass wet while it is in
storage. Biomass is mixed with additional water and made into large piles. Depending on the size
of the pile, dry matter loss could be less than 5%. Advantages of a system like this include storing
a given amount of biomass in a smaller area, softening biomass so as to weaken the lignin
structure, and reduced risks of fire. It may also be more energy-efficient to add water than to
remove it. However, as biomass is stored in such wet conditions, the bacteria that forms can
consume some of the sugar that would otherwise be fermented.67
Moisture Content Concerns
Corn stover and switchgrass are assumed to have a moisture content of around 15%.68 Shortrotation woody crops, like poplar and willow, have about 50% moisture content at harvest.69 In
order for wood to be used for fuel, the moisture content cannot be above 65%. At this point, the
energy required to dry the wood is greater than the energy content of the dry wood. The moisture
content of forest residues tends to be between 40 and 60%, while the moisture content of primary
mill residues, which include pulp, paper, and lumber, is around 20%, and the moisture content of
secondary mill residues, which are kiln dried, is less than 10%.70
Quality Uniformity Concerns
Biomass can have highly inconsistent quality and characteristics, not only among feedstocks but
within a feedstock type. With biomass feedstocks coming from numerous sources and producers
over the course of an entire year for use at a single plant, it is initially processed so that the size
will be as uniform as possible to optimize the conversion process. Plants receiving biomass that
has been harvested differently and stored under a variety of conditions will incur additional costs
to arrive at a uniform feedstock product.
Having a uniform feedstock delivered to the plant will decrease processing and pretreatment
costs. With more experience and the development of the appropriate harvesting, collecting, and
storage technologies, the pre-treatment processing step could take place before the biomass even
arrives at the plant, which would eliminate the extra step and allow the plant to start with a
uniform and consistent product, regardless of its source. In the case of corn stover, some
processing may take place during harvest. As previously discussed, single-pass harvesting can
allow stover to be chopped rather than baled. Stover in this form, however, will have high
moisture content and may not be compacted.
67
J. W. Kram, “Search of Biomass Storage Solutions,” Ethanol Producer Magazine, 2008, pp. 86-91.
Petrolia (2008); Schechinger and Hettenhaus (1999); D. A. Glassner, J. R. Hettenhaus, and T. M. Schechinger, “Corn
Stover Collection Project,” BioEnergy ’98: Expanding BioEnergy Partnerships, 1998, pp. 1100-1110; J. E. Atchison
and J. R. Hettenhaus, Innovative Methods for Corn Stover Collecting, Handling, Storing and Transporting, NREL/SR510-33893, National Renewable Energy Laboratory (Golden, CO), March 2003; M. Khanna, B. Dhungana, and J.
Clifton-Brown, “Cost of Producing Miscanthus and Switchgrass for Bioenergy in Illinois,”S Biomass and Bioenergy,
32(6), 2008, pp. 482-493; and D. G. Tiffany, B. Jordan, E. Dietrich, B. Vargo-Daggett, Energy and Chemicals from
Native Grasses: Production, Transportation and Processing Technologies Considered in the Northern Great Plains,
Staff Paper P06-11, University of Minnesota, Department of Applied Economics, College of Food, Agricultural &
Natural Resource Sciences, 2006.
69
G. A. Keoleian and T.A. Volk, “Renewable Energy from Willow Biomass Crops: Life Cycle Energy, Environmental
and Economic Performance,” Critical Reviews in Plant Sciences 24, 2005, pp. 385-406.
70
P. C. Badger, , Processing Cost Analysis for Biomass Feedstocks, ORNL/TM-2002/199, Oak Ridge National
Laboratory (Oak Ridge, TN), October 2002.
68
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Conclusions
The production of cellulosic feedstocks is a challenge to the development of the cellulosic
biofuels industry. The establishment, maintenance, harvest, storage, and transport of cellulosic
feedstocks remain far from perfect and will need to be improved in order to reduce feedstock
costs. Whether the feedstock is a residue or dedicated crop, there is not much experience among
producers. Table 15 includes best-guess estimates of farm-gate feedstock costs. Transportation
would also need to be added to determine the delivered cost of feedstocks, but this will depend on
how far feedstocks are from the plant location. Each feedstock option is faced with opportunities
to reduce production costs, and the choice of which feedstock to use will depend upon the
location of the plant and the local feedstock supply availability.
Table 15. Estimated Farm Gate Cellulosic Feedstock Costs
Feedstock
Approximate Cost per Dry Ton
Switchgrass
$65 to $85
Miscanthus
$60 to $80
Corn Stover
$50 to $70
Short-Rotation Woody Crops
$50 to $60
Forest Residues
$45
Source: Estimates by Tyner, Brechbill, and Perkis, Purdue University, August 2010.
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Cellulosic Ethanol: Feedstocks, Conversion Technologies, Economics, and Policy Options
Chapter 4: Cellulosic Biofuel Conversion
Technologies
Biochemical and thermochemical conversion of lignocellulosic feedstocks are currently receiving
the most attention as processing methods for cellulosic biofuels. Neither conversion process is
ready for commercialization. Much of what is appearing is taking place in laboratories and
demonstration and pilot plants that are small in scale. Plans for commercial plants have been
announced by several companies. However, commercialization is likely to be slow to develop
absent significant incentives, and cost reductions will be necessary for it to develop.
This chapter will focus on the biochemical and thermochemical conversion processes. Each
process is described in some detail, and the likely areas for efficiency improvements and cost
reductions are discussed. Energy yields and production costs for each process from recent studies
is then presented. The current state of operational and proposed cellulosic biofuels plants is then
outlined, along with a discussion of the funding thus far allocated by the federal government.
Finally, there is an overview of some other developing technologies that are receiving attention as
research continues to improve the efficiency of conversion processes.
Biochemical Conversion
The biochemical conversion process, as summarized in Figure 6, has attracted the most attention
so far because of its similarities to the process currently used to produce ethanol from corn grain.
Figure 6. Biochemical Conversion Process
Source: U.S. Department of Energy, Energy Efficiency and Renewable Energy, Biomass Program, at
http://www1.eere.energy.gov/biomass/index.html.
Enzymes or acids are used to break down the plant into sugars that are then fermented into liquid
fuel. Several processes are currently being researched and developed in laboratories, but it is
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difficult to know with any certainty whether those that appear successful in trials will also be
successful on a commercial scale.
Pretreatment
The feedstock is pretreated by changing its chemical makeup in order to separate the cellulose
and hemicellulose from the lignin (Figure 7). With the biochemical conversion process, the lignin
cannot be fermented into liquid fuel, but it can be recovered for later use.
Figure 7. Simplified Impact of Pretreatment on Biomass
Source: Mosier, N., C. Wyman, B. Dale, R. Elander, Y.Y. Lee, M. Holtzapple, and M. Ladisch, “Features of
promising technologies for pretreatment of lignocellulosic biomass,” Bioresource Technology 96(6), 2005, pp. 673686.
Reducing the lignin content of biomass or modifying it in some way are alternatives that would
reduce the inputs necessary for pretreatment and enhance the effectiveness of hydrolysis. A
pretreatment system should maximize the remaining amount of sugar and keep the overall
process as simple as possible in order to reduce costs relative to the amount of sugar that is
recovered. It is ideal for a pretreatment process to be flexible enough to handle multiple types of
biomass feedstock and to reduce the preparation and processing necessary. That is, the
pretreatment processes should be able to utilize many different feedstocks in a variety of forms.
Pretreatment should also minimize the amount of enzymes that must be used in hydrolysis. It is
estimated that pretreatment of biomass accounts for 17% of capital costs.71
Biological pretreatment can use fungi to change the chemical composition of the feedstock by
attacking the lignin. This process, however, can take 10 to 14 days, so it is not being focused on
for commercialization. Physical pretreatment will perform a mechanical breakdown of the
71
Solomon, B.D., J.R. Barnes, and K.E. Halvorsen, “Grain and cellulosic ethanol: History, economics, and energy
policy,” Biomass and Bioenergy 31, 2007, pp. 416-425.
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crystalline structure to increase the surface area and make it more susceptible to attacks by
enzymes or acids in later steps. The lignin is not removed with this pretreatment, and the energy
inputs are presently too high for commercialization. Chemical pretreatment is used in commercial
pulping processes with the goal of maintaining the overall structure of the high value pulp. With
biomass, the structure should be broken down, and the pretreatment process should be less
expensive. Combination pretreatments that use both the physical and chemical pretreatment
processes are being explored as an improved alternative for biomass.72
Hydrolysis
After sugars from the cellulose and hemicelluloses are separated and exposed during
pretreatment, hydrolysis uses enzymes or acids to break down the complex chains of sugar
molecules into simple sugars in preparation for fermentation. Hydrolysis will result in both
glucose and xylose, which are six and five carbon sugars, respectively. Currently, enzymatic
hydrolysis may be the better economic choice for commercialization relative to acid hydrolysis.
Compared to acid hydrolysis, enzymatic hydrolysis is faster, more efficient, results in better
yields, and uses less chemical input. Using enzymes in the hydrolysis of starch only requires one
family of enzymes or cellulases. However, lignocellulosic biomass requires different cellulases to
address the multiple parts of the plant.
The efficiency of hydrolysis is highly dependent on the effectiveness of pretreatment. If
pretreatment leaves behind a large amount of lignin, the yield of simple sugars from hydrolysis
may be reduced. The presence of lignin prevents enzymes from hydrolyzing. It is unlikely that the
lignin can be completely removed from biomass, but there may be a possibility for changing
some lignin characteristics in order to make it more compatible with the hydrolysis process. In the
meantime, new types of catalysts that are able to deal with the lignin are being researched.
Hydrolysis can be an expensive step depending on the cost of the enzymes. These costs have
definitely decreased over time but in many cases cost reduction is still a hurdle to
commercialization. For a 50 million gallon per year plant, enzymes cost about 50 cents per gallon
in 2009. By 2015, this cost is expected to be 44 cents per gallon.73
Fermentation
After pretreatment and hydrolysis have released simple sugars, fermentation is used to turn as
much of that sugar as possible into liquid fuel. Hexoses, or six carbon sugars in the form of
glucose, can be fermented using traditional yeast strains. Pentoses, or five carbon sugars in the
form of xylose, are not fermented as easily, and research is being conducted to improve and
develop microorganisms that can ferment pentose sugars. A yeast microorganism developed at
72
Sims, R., M. Taylor, J. Saddler, and W. Mabee, From 1st to 2nd Generation Biofuel Technologies: An overview of
current industry and RD&D activities, Organization for Economic Co-Operation and Development and International
Energy Agency, © OECD/IEA, November 2008, [hereafter referred to as Sims et al, OECD/IEA (2008)].
73
Rismiller, C.W. and W.E. Tyner, Cellulosic Biofuels Analysis: Ec
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