Alternative Fuels and The Global Auto Industry Report

Alternative fuels and the global auto industry (2nd editon)
Alternative fuels and the global auto industry (2nd editon)
Published: June 2011
An AutomotiveWorld.com report published by: Automotive World Ltd 14 Great College Street Westminster London, SW1P 3RX United Kingdom Tel: +44 (0) 20 7878 1030 Fax: +44 (0) 20 7878 1031 http://www.automotiveworld.com
ABOUT THE AUTHORS

Mike Murphy
Michael Murphy, BSc, MPhil (Hons I), is an automotive industry researcher and writer who has written automotive features and columns for many years, and industry sector reports since 2004. He was previously one of Automotive Worlds news editors and continues to contribute to the news publication side of the business.
Contact Details:
Automotive World 14 Great College Strret Westminster London SW1P 3RX Telephone: Fax: E-Mail: Website: +44 (0) 20 7878 1030 +44 (0) 20 7878 1031 info@automotiveworld.com www.automotiveworld.com
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DISCLAIMER
This report is the product of extensive primary and secondary research. It is protected by copyright under the Copyright, Designs and Patents Act 1988. The authors of Automotive World Ltd research reports are drawn from a wide range of professional and academic disciplines. The facts within this report are believed to be correct at the time of publication but cannot be guaranteed. The information within this study has been reasonably verified to the authors and publishers ability, but neither accept responsibility for loss arising from decisions based on this report. This report contains forward-looking statements that reflect the authors current views with respect to future events. Such statements are subject to risks and uncertainties. If any of the assumptions underlying any of these statements prove incorrect, then actual results may be materially different from those expressed or implied by such statements. The authors do not intend or assume any obligation to update any forward-looking statement, which speaks only as of the date on which it is made. All the estimates are based on assumptions, the authors calculations and publicly available data. AutomotiveWorld.com is not liable for misrepresentation or misuse of such information or validity of publicly available information.
Contents
TABLE OF CONTENTS LIST OF FIGURES / TABLES EXECUTIVE SUMMARY INTRODUCTION MARKET DRIVERS
The global oil and gas supply Energy security Carbon dioxide emissions regulations
Europe The United States Japan Other countries
iii 1 2 4
4 5 5
5 6 6 6
Toxic emissions regulations

Ethanol Butanol Biodiesel Gas-to-liquids diesel Dimethyl ether (DME) Natural gas (NG) Liquefied petroleum gas (LPG)
6
7 7 7 7 7 8 8
Regulations requiring biofuels use

Europe The United States Other countries
8
8 8 9
Incentives
The United States The European Union
9
9 10
MARKET BARRIERS
Production volumes Supply infrastructure Actual greenhouse gas emissions reductions
Biofuels Bioethanol Biobutanol Biodiesel Natural gas Liquefied petroleum gas Hydrogen Synthetic fuels Overview Reduced fuel storage and operating range Competition with food
13
13 13 14
15 15 16 16 16 16 16 16 17 18 18
MARKET DYNAMICS AND FORECASTS

Alcohols Biodiesel Liquefied petroleum gas Natural gas Hydrogen
21
21 22 22 22 23
Alternative fuels and the global auto industry (2nd edition)
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Contents
II
ALTERNATIVE FUELS
Algal biofuels Cyanobacterial biofuels Alcohols
Methanol Ethanol Blends Ethanol-capable vehicles Butanol
25
25 25 26
26 26 27 28 28
Biodiesel
Properties Feed-stocks Blends Environmental issues New production processes
29
29 30 31 31 31
Biogasoline Dimethyl ether Hydrogen Liquefied petroleum gas Natural gas

Compressed natural gas Liquefied natural gas Biogas Methane hydrates Hythane
32 32 33 34 34
34 35 36 36 37
Gas to liquids (GTL)

Indirect via methanol Fischer-Tropsch
37
37 37
Coal to liquids Waste to liquids (WTL) Carbon dioxide to fuel Vegetable oils
38 38 38 39
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Contents
iii
LIST OF FIGURES & TABLES

Figure 1: Global natural gas reserves, 1 January 2009 Figure 2: Fuel economy targets in selected countries in mpg (US) Figure 3: E85 station distribution by US state Figure 4: Existing or planned hydrogen refuelling stations in Europe Figure 5: WTW CO2 emissions by fuel source for US light vehicles (g/mile) Figure 6: Lifecycle CO2 emissions (tonnes) by fuel source, C-segment car Figure 7: Global ethanol production forecast to 2019 (billions of litres) Figure 8: Global biodiesel production forecast to 2019 (billions of litres) Figure 9: Global light distillate consumption (1,000 barrels per day), 2005 2009 Figure 10: Global natural gas production (billion cubic metres), 2005 2009 Figure 11: Switchgrass Figure 12: Biodiesel plant built into a shipping container Figure 13: LNG tanker Figure 14: Shell Prelude Floating Liquefied Natural Gas (FLNG) Project Table 1: Top 15 world oil producers, proven reserves, annual production and reserve life (2009) Table 2: WTW CO2 emissions by fuel source for US light vehicles Table 3: Feed-stock to fuel type Table 4: Estimates of the yield potential of different vegetable oil crops per acre vary considerably: 5 6 14 14 17 18 21 22 22 22 27 30 35 36 4 17 25 30
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Executive summary
EXECUTIVE SUMMARY
Fuels that offer alternatives to petroleum-sourced conventional automotive fuels include other fossil fuels such as natural gas and synthetic liquid fuels produced from natural gas and coal. Non-fossil alternative fuels include alcohols and biodiesel produced from a variety of biomass feed-stocks via fermentation and other processes including photosynthesis by algae and bacteria. The markets for alternative fuels are being driven by concerns regarding the worlds ultimately finite supply of oil, energy security, greenhouse gas emissions associated with global climate change, attempts to reduce toxic fuel emissions to improve public health, regulations requiring their use and incentives to do so. The markets for alternative fuels, particularly biofuels, are limited by the relatively small production volumes that are possible to date, the lack of a supply infrastructure in some cases, concerns regarding the actual greenhouse gas emissions reductions that are possible and concerns regarding feed-stock competition with food crops. In general, the production and demand for all alternative fuels are increasing although there was a downturn in alternative fossil fuel production during 2009 during the global economic recession. Biofuel production is forecast to increase substantially in future.
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Introduction
INTRODUCTION
The markets for alternative automotive fuels and the vehicles that can operate on them have been growing dramatically during recent years, stimulated by a growing list of factors accompanied by an increasing sense of urgency. The range of alternative fuels already in use and under development is varied and wide, and includes biofuels produced from materials such as food crops and organic waste, hydrogen produced from natural gas or via the electrolysis of water, compressed or liquefied petroleum gases, and a number of reformulated or synthesised gases and liquids produced from petroleum gas or coal. Similarly, the factors driving these developments are manifold and include the ultimately finite global petroleum reserves, national interests in improving energy security and regulations that require lower levels of toxic and greenhouse gas (GHG) emissions which, in turn, have led to the enactment of regulations and the provision of incentives designed to increase the use of biofuels. However, there are significant barriers restricting almost all pathways to developing and producing sustainable fuels that can replace the petroleum-based products that the worlds economies and transportation systems have utilised so freely for so long. Perhaps the most disappointing of these is that the lifecycle GHG emissions savings resulting from the use of some alternative fuels are not as significant as first hoped and in some cases even appear to be worse than using conventional petroleum fuels. Furthermore, the enormous areas of land required to cultivate sufficient biofuels crops are simply not available and the clearing of rain forests or peat land to provide more agricultural land is counterproductive to the espoused goal of reducing GHG emissions. This report does not cover, apart from brief mention, the use of electricity as an alternative fuel in electric or plug-in hybrid-electric vehicles, or the use of hydrogen in fuel cell vehicles. For a full review of those, see Automotive Worlds The electric car report (2nd edition), The electric and hybrid commercial vehicles report (2nd edition), The fuel cell vehicle and hydrogen infrastructure report and The electric vehicle recharging infrastructure report.
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Chapter 1: Market drivers
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Market drivers
MARKET DRIVERS
The global oil and gas supply
Oil currently provides about 40% of the worlds energy and 96% of its transportation energy, and global consumption has steadily grown for the last century. More recently, the enormous economic growth in China, India and other developing countries has introduced a new factor into global oil demand, with consumption in China increasing at 8% per year since 2002. The US Energy Information Administration has forecast that global oil demand will increase 37% by 2030, and that growth will be largely driven by the transportation sector. As has been evident from the rapid increase and on-going volatility of crude oil prices during the last few years, the worlds oil supply is under pressure. This is, in part, because there is a need to expand the extraction and refining infrastructure that attracted inadequate investment for many years while oil was inexpensive and the supply sufficient to meet demand. However, of greater long term concern is that the worlds oil reserves are ultimately finite and extraction of the dwindling and less accessible supply is going to become increasingly expensive. This issue has been cast into sharp relief by the now widespread concept of peak oil, the point at which the maximum potential rate of global oil production is reached before declining rapidly in the face of increasing demand. Just when this will occur is difficult to determine, with the more pessimistic analysts asserting that it has already occurred, or is imminent, while optimists suggest that it could be several decades away. The uncertainty is at least in part because of the difficulty in estimating global reserves, which is confounded by the fact that large regions have not been the subject of thorough exploration, and by different suppliers using different, and in some cases apparently doubtful, methods of accounting for their reserves. Moreover, reserves are defined as the quantities that are economically extractable, a figure that shifts in parallel with the price of crude oil. Estimates of reserve life are, of course, based on estimated demand. In the table below, reserve life is calculated simply on 2009 production volume yet demand is increasing steadily. For example, 2010 production increased 2.38% over 2009 volume and as the global economy recovers, annual demand increases will be considerably greater. Table 1: Top 15 world oil producers, proven reserves, annual production and reserve life (2009)
Country Saudi Arabia Canada Iran Iraq United Arab Emirates Kuwait Venezuela Russia Nigeria Mexico United States China Brazil Algeria Norway Total Reserves (trillion barrels) 263 179 133 112 98 97 76 69 36 33 22 18 15 12 10 1,349 Production (trillion barrels per year) 3.562 1.202 1.525 0.876 1.02 0.911 0.902 3.626 0.807 1.095 3.336 1.459 0.941 0.761 0.858 30.783 Reserve life (years) 74 149 87 128 96 106 84 19 45 30 7 12 16 16 12 44
Sources: CIA World Fact Book, US Energy Information Administration
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Market drivers
In the case of natural gas, global reserves total over 6,600 trillion Figure 1: Global natural gas reserves, 1 cubic feet, or about 62 times the volume consumed in 2009. January 2009 However, Russia has 26.8% of these, Iran 15.9%, Qatar 14.3%, other OPEC countries 21.3%, and other Caspian countries 3.9%. North America has only 5.1% and Western Europe, 2.6%, mostly in Norway and the Netherlands. China has 1.3%, India has 0.6% and Japan has virtually none. Furthermore, much of the proven natural gas reserves are designated as stranded because they are located long distances from consuming markets.
Energy security
The US consumes about 25% of the oil used worldwide and about 20% of the natural gas, while the EU consumes about 18% of the oil and more than 16% of the natural gas, and Japan consumes about 7% of oil and about 3% of natural gas. Because large proportions of these supplies must be imported, all three regions, which together consume 50% of global oil and 40% of natural gas, are vulnerable to the external control of supply and price. Consequently, all have a strong interest in reducing dependence on foreign fuel supplies through increased fuel economy and the use of alternative fuels. Despite concerns that several of the largest oil fields in Saudi Source: Oil and Gas Journal Arabia and the United Arab Emirates are now mature, the Middle East is still regarded as having a major share of the worlds oil reserves and OPEC countries account for around 75%. Added to this, the oil fields in the Caspian region are the subject of competition from all the major powers. Western countries want to increase supplies through Turkey to the Mediterranean, through Azerbaijan and Georgia to the Black Sea, or through Turkmenistan and Afghanistan to Pakistan and the Indian Ocean, and wish to prevent access through Iran. Russia has a pipeline through Chechnya and has considerable influence in Kazakhstan and Kyrgyzstan. China is constructing a pipeline from Kazakhstan, where India is also seeking influence. With respect to natural gas, more than 50% of known reserves are held by OPEC countries and more than 30% by Russia and other Caspian countries. The developed nations and the new growth nations of China and India must import it, either by pipeline, as is the case with much of Europe sourcing it from Russia, or by transportation of liquefied natural gas (LNG) by ship.
Carbon dioxide emissions regulations

With CO2 implicated as a major GHG, almost all jurisdictions worldwide have introduced regulations designed to reduce CO2 emissions by light vehicles, either directly or through fuel economy targets. Penalties can be imposed on OEMs for new vehicle sales that fail to meet the average required. Similar regulations are being developed in Europe and the US for heavy commercial vehicles. Several of the alternative fuels under consideration, particularly those produced from biomass and natural gas offer the potential to help reduce CO2 emissions compared to the use of gasoline and petrodiesel. Counter to these advantages, however, ethanol provides as much as 20% to 30% poorer fuel efficiency when measured on a per volume basis such as miles per gallon.
Europe
In December 2007, the EC adopted mandatory manufacturer fleet average CO2 emission limits for new cars from 2012 of 130 grams of CO2 per kilometre (g/km), equivalent to around 5.2 litres/100km for gasoline, or 50mpg (Imperial) or 42mpg (US). For light vans, the fleet average emission targets will be 175g/km by 2012 and 160g/km by 2015. Part of the target (10g/km) can be achieved by measures such as the use of biofuels.
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Market drivers
The United States

The US Corporate Average Fuel Economy (CAFE) standards that were introduced in 1975 following the first OPEC oil shock were essentially reinstated and revised as part of the December 2007 energy bill. In 2009 the target date of 2020 was brought forward to 2016. The new standards require an average of 35.5mpg (US) for passenger cars, pickups, minivans and SUVs combined, by model year 2016. OEMs can trade credits and there are exemptions for OEMs that sell fewer than 60,000 vehicles per year in the US.
Japan
Japanese OEMs have exceeded regulatory fuel economy targets set to date, but new regulations were introduced during 2007 that require them to improve the average fuel efficiency of their vehicles by more than 23% over 2004 levels by 2015, taking the average fuel economy of the Japanese fleet to 40mpg (US) by 2015, from around 32mpg (US) in 2004.
Other countries
Several other countries, including Australia, Canada, China, Taiwan and South Korea have also set fuel economy or CO2 emissions targets. Figure 2: Fuel economy targets in selected countries in mpg (US)
Sources: Green Car Congress; ICCT. Note: Fuel economy estimates are calculated using different test protocols in different jurisdictions.)
Toxic emissions regulations

Vehicle emissions regulations were first introduced during the 1960s and 1970s to address the various toxic emissions released by vehicle exhausts and fuel systems because of concerns regarding public health and the effects of acid rain. Over time, those regulations have become more and more stringent to the point that further gains beyond the limits proposed for introduction during the next few years in the developed regions will be difficult to achieve. However, most of the alternative fuels currently under consideration burn more cleanly than petroleum-derived fuels and can make a useful contribution to lowering toxic emissions levels. Hydrogen is particularly clean-burning, and petroleum gases produce significantly lower levels of all regulated toxic emissions than gasoline and diesel.
Market drivers
Ethanol
US studies presented in a literature review found that E10 resulted in 22% to 36% lower PM emissions compared to gasoline, depending upon the age of the vehicle, HC emissions were reduced 16.5% and NOx emissions levels were similar to those from gasoline. According to the US Renewable Fuels Association, ethanol reduces carbon monoxide (CO) emissions by as much as 30%, particle mass (PM) by 50% and unburned hydrocarbons (HC) by 13%, despite a threefold increase in evaporative emissions. However, nitrogen oxides (NOx) emissions increased. An Australian government study of E20, found that NOx emissions increased by about 30%, compared to no increase for E10. However, the 30% increase took NOx to no more than 50% of the allowable limit. E85 has a significantly lower energy density than gasoline and combustion flame temperatures are lower, helping to lower NOx production to levels similar to gasoline. CO and HC levels are lower than for gasoline, although acetaldehyde emissions can increase. However, modern catalytic converters reduce acetaldehyde levels to around those from gasoline. As well as being blended into gasoline, ethanol can be blended with diesel. O2Diesel Europe, for example, produces a blend of ethanol and diesel that consists of 7.7% ethanol with about 1% proprietary additive and a cetane improver. Compared to petrodiesel, the blend reduces PM emissions by 46%, CO by 23% and NOx by 8.5%.
Butanol
In 2005, ButylFuel founder, David E. Ramey, drove an unmodified 1992 Buick Park Avenue across the US on 100% butanol. The car returned 24mpg compared to 22mpg on gasoline and independent emissions tests conducted by the US Environmental Protection Agency (EPA) found that HC was reduced by 95%, NOx by 37% and CO was almost eliminated.
Biodiesel
Biodiesel contains fewer aromatic hydrocarbons than petrodiesel and no sulphur, reducing HC emissions by up to 67%, CO by up to 48% and PM by up to 47% compared to low-sulphur (less than 50ppm) petrodiesel. However, NOx emissions may be about 10% higher and a European study found that the use of more than a 30% of biodiesel could result in NOx emissions at higher levels than the limits set by Euro 4. PM emissions during production can be reduced by as much as 50%. SunEco Energy claims that its biodiesel produces up to 82% less PM. Daimler Trucks claims that using palm oilbased biodiesel reduces NOx emissions by up to 15% compared to ultra-low-sulphur (less than 10ppm) petrodiesel (ULSD).
Gas-to-liquids diesel
In a six-month trial by Volkswagen and Shell, 25 Euro 4-compliant but otherwise unmodified Volkswagen Golfs were fuelled with gas-to-liquids (GTL) synthetic diesel. Against identical vehicles run on petroleum ULSD, reductions of 91% for CO, 63% for HC, 26% for PM and 6% for NOx were measured. More recently, Shell has claimed that its GTL diesel emits 50% less NOx than petrodiesel while HC levels are lower.
Dimethyl ether (DME)

Tests conducted using dimethyl ether (DME) in a 5.9-litre Cummins diesel engine found that PM emissions were reduced by 75% and the remaining PM was largely attributed to normal consumption of crankcase lubricating oil. NOx, CO and sulphur oxides (SOx) levels easily complied with Euro 5, US2010 and J2009 requirements. However, HC emissions increased although these were essentially unburned DME, which is considered non-toxic and environmentally benign. The levels of several non-regulated toxic emissions, including formaldehyde and methane, were significantly higher but were still only present in very small quantities. Acetaldehyde emissions were reduced by 79%, acetone emissions by 77%, and acrolein, ethylene, propylene and propionaldehyde emissions were reduced to insignificant levels.
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Market drivers
It was believed that further significant reductions in exhaust emissions could be realised by optimising the DME injection/combustion systems, incorporating an exhaust gas recirculation (EGR) system and installing a more effective exhaust catalyst. Due to very low PM emissions, large quantities of EGR could be implemented for DME operation without incurring engine reliability issues associated with high levels of PM entering the combustion chamber.
Natural gas (NG)

According to Natural Gas Vehicles for America, natural gas vehicles emit 70% to 90% less CO, 75% to 95% less NOx and 50% to 75% less non-methane organic gases than a gasoline vehicle. However, NaturalDrive Partners claims 51% less CO and 41% less NOx from laboratory tests of a 6.0-litre GM light truck engines it converted to natural gas operation.
Liquefied petroleum gas (LPG)

According to the US Propane Education & Research Council, liquefied petroleum gas (LPG), which is also known and marketed as propane although it typically includes other gases, produces 60% less CO, 20% less NOx and up to 78% less PM than gasoline.
Regulations requiring biofuels use

During recent years, regulations have been introduced in several countries that require the increasing use of biofuels. However, questions have been raised about their worth and the adverse consequences that biofuel production can have, and targets have been revised downward.
Europe
In 2003, the European Commission (EC) introduced a Biofuels Directive and an action plan that targeted increasing the biofuels share of EU transportation fuels to 20% by 2020. In 2008, the EC reaffirmed its commitment to the programme but introduced conditions that food prices and food security must be taken into account and that production must not use land with high biodiversity value, such as natural forests and protected areas. The 5.75% target originally set for 2010 was relaxed to 4% by 2015 because of concerns regarding first-generation biofuels production but the expectation that second-generation biofuels would meet environmental and social sustainability criteria encouraged the retention of a revised 2020 target of 10%. The Netherlands had already called upon the EU to reconsider its biofuels targets, asserting that the GHG savings fell short of the required 35% and that the land required to grow sufficient biofuel crops was simply unavailable. France and Germany revised their targets downward and the UK moved its Renewable Transport Fuel Obligation target of 5% from 2010/11 to 2013/14. In 2008, the EU also approved the inclusion of up to 10% ethanol in gasoline and up to 7% fatty acid methyl ester (FAME) in diesel, although it allowed member states to approve higher FAME blends, a move that was opposed by the European Automobile Manufacturers Association (ACEA), which had agreed to ensure that the diesel vehicles its members manufactured were capable of operating safely and reliably on a maximum of 7%.
The United States

The US Renewable Fuels Standard (RFS) was established by the federal government through the Energy Policy Act of 2005. The RFS originally required that the use of renewable fuels rise gradually from 4.7 billion gallons in 2007 to 7.5 billion gallons in 2012 with a 2.5% transport fuel obligation from 1 April 2009. Some states have adopted mandates requiring the use of ethanol-blended gasoline. In California, for example, all gasoline contains 5.7% ethanol. Enacted in 2007, the Energy Independence and Security Act (EISA) required nine billion gallons of renewable fuels to be blended into the US transportation fuel supply during 2008 and increase incrementally to 36 billion gallons by 2022. The EISA also contains specific targets for cellulosic biofuel and biomass diesel, with 0.6 billion gallons to be used in 2009, rising to 21 billion gallons in 2022. The EPA raised the RFS for 2008 from 4.66% to 7.76% to ensure that the targets were met and increased it to 10.21% for 2009, which equates to at least 11.1 billion gallons of renewable fuel.
Market drivers
Renewable fuels that qualified under the RFS include ethanol from corn, cellulose, or sugar, as well as biodiesel, ETBE, biobutanol, and gasoline or diesel from biogas or biomass gasification. However, in March 2008, the Renewable Fuels Agency launched a review, calling for evidence of the indirect impacts of biofuels production such as land-use change and food insecurity. In 2009, standards were introduced that required fuel-cycle GHG emissions savings before the fuel qualified for credits: 50% less for biomass-based diesel and advanced biofuels, and 60% less for cellulosic biofuels. A lower threshold of 20% GHG savings was introduced for new production facilities that had commenced construction before 19 December 2007. States can set requirements for biofuel content in fuel. For example, Minnesota and Oregon require that diesel contains 5% biodiesel with the Minnesota requirement set to increase to 10% by 2012 and 20% by 2015. In 2009, California also introduced a Low Carbon Fuel Standard that calls for a 10% reduction in GHG emissions by 2020, designed to increase the diversity of transportation fuels and support the market for alternative-fuel vehicles. When the then Governor Schwarzenegger ordered the standards in 2007, the objective was to replace 20% of the fuel used in the states vehicle fleet with renewable fuels by 2020.
Other countries
Canadian regulations require that gasoline must contain an average of 5% renewable content and from July 2011, diesel fuel for on-road vehicles and heating oil must contain a 2% blend of biodiesel. South Korea plans to increase the blend of biodiesel in its diesel fuel from 1% in 2008 to 3% by 2012 in annual 0.5% increments and is considering further increases to take it to 5%. The introduction in Germany of gasoline with a 10% ethanol content - known as E10 - met widespread disapproval among German drivers, many of whom refused to use the new fuel amid concerns that it could be harmful to some cars.
Incentives
The production of biofuels has attracted various subsidies in several countries, encouraging the rapid growth that has occurred in the industry during recent years. In some cases, the production of biofuels-capable vehicles also attracts incentives, and vehicles that run on biofuels are eligible, in some countries, for relief from licensing taxes and congestion charges.
The United States

The US government has subsidised ethanol since the late 1970s, protected domestic ethanol producers with tariffs, and offered tax incentives and CAFE credits to encourage automotive manufacturers to produce biofuel-capable vehicles. The Renewable Fuel Standard (RFS) increased the incentives for ethanol use and production, and an additional tariff of US$0.54 per gallon was imposed on imported ethanol, taking it to US14.27 cents per litre. A tax credit of US$0.51 per gallon of ethanol blended into gasoline was introduced while the tax credit for blended biodiesel ranges from US$0.50 to US$1.00 per gallon, depending on the source feed-stock. The US Department of Agriculture (USDA) provides grants and loans and other financial support to assist with the establishment of biofuels and renewable energy commercialisation including the harvesting, collection, storage and transportation of eligible biomass. In 2009, President Obama established the Biofuels Interagency Working Group, co-chaired by the USDA, the Department of Energy (DOE) and the EPA, to develop a comprehensive approach to accelerating the investment in and production of biofuels. In 2007, the federal funding available for development programmes for second-generation, non-food, cellulosic ethanol production was increased with the DOE to provide up to US$33.8m in funding to support R&D to improve enzyme systems for the production of cellulosic biofuels. In 2008, the Farm Bill introduced provisions aimed at increasing cellulosic production through a tax credit of US$1.01 per gallon and reducing the credit on corn ethanol to US$0.45. The bill also increased the funding available for second-generation development programmes. Subsidies are also available towards the cost of adding E85 pumps at filling stations.
Market drivers
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In October 2010, the USDA announced that it would resume payments to eligible producers of biomass through the Biomass Crop Assistance Program (BCAP), which had been operating as a pilot programme to ensure that a sufficiently large base of new, non-food, non-feed biomass crops is established in the US. Producers who enter into BCAP contracts can receive payments of up to 75% of the cost of establishing eligible perennial crops and can receive payments for up to five years for annual or non-woody perennial crops and up to 15 years for woody perennial crops. BCAP also assists agricultural and forest landowners and operators by providing payments for the transportation of eligible materials that are sold to qualified biomass conversion facilities. In some cases, state funding is also available. For example, in October 2008, Mascoma received US$26m from the DOE and US$23.5m from the State of Michigan towards building a cellulosic ethanol plant. For 2011, the California Energy Commission proposed allocating US$100m for investments in alternative fuel projects, including electric vehicle recharging infrastructure. US$22m was to be allocated to medium- and heavy-duty trucks, US$8m to support biomethane production, US$8m for natural gas infrastructure, US$7.5m for producing biofuel gasoline substitutes from waste-based cellulosic feed-stocks, US$7.5m for producing diesel substitutes, US$4m for terminal and infrastructure for diesel substitutes and US$2m for hydrogen-powered vehicles. At the end of 2009, a tax incentive programme worth US$1 per gallon and designed to promote the production of biodiesel was terminated and entrepreneurs in the US who would like to invest in algae-based biofuel production have pointed out that the current tax regime does not provide incentives for the sector that would significantly assist in the creation of an algal fuel industry. In May 2010, the US House of Representatives voted to extend the credits until the end of the year. In December 2010, the US Congress approved tax credits of US$0.50 per gallon equivalent for compressed natural gas and liquefied natural gas when used as transportation fuel. The credit had expired in 2009 but was made retroactive for 2010. Congress also approved investment tax credits for refuelling property, such as natural gas stations, of up to 30% or US$30,000, whichever is less and up to US$1,000 for a home refuelling unit. Tax credits for the purchase of natural-gas vehicles were not extended beyond the end of December. In April 2011, a bill was introduced that, if passed into law, will provide incentives for the use of natural gas as a fuel, the purchase of natural gas-fuelled vehicles and the installation of a refuelling infrastructure. US automotive manufacturers receive CAFE credits for producing E85 flex-fuel vehicles, although there is no requirement that consumers operate the vehicles on E85, and E85 has only limited availability throughout the US. It costs only about US$200 extra to produce a flex-fuel vehicle, which needs corrosion-resistant fuel lines, higher flowrate injectors and sensors that measure the ethanol-gasoline blend in real time to enable the engine management system to adjust fuel-air mixture and ignition parameters. Some vehicles also attract US federal tax credits. In 2010, Altech-Eco Corporation of Asheville, North Carolina, negotiated a US$4,000 tax credit for purchasers of their natural gas-converted Ford Focus. Previously, one Honda natural gas model qualified for a similar tax credit in the US. For trucks dedicated to run on natural gas, tax credits range from US$5,000 for light-duty vehicles; US$10,000 for medium-duty; US$25,000 for medium-heavy-duty; and US$40,000 for heavy-duty models. In 2010, a bill was introduced to double those tax credit amounts in order to better match them to the purchase price premiums associated with natural gas-powered trucks.
The European Union

In 2004, the EC introduced a subsidy of 45 per hectare for biofuels crops in an effort to increase the productive area from 0.31 million hectares to 2.0 million hectares in 2007. However, applications reached 2.84 million hectares by October 2007, substantially exceeding the 90m budget such that the Commission reduced the subsidy accordingly. By that time, the issues regarding actual GHG emissions savings and increased food prices were being raised, and there were calls for the subsidy to be reviewed. In January 2008, Germany increased taxes on biofuels to the same level as those on petroleum fuels, and in September, France announced plans to remove all tax incentives for biofuels. The Netherlands and the UK also revised incentives for biofuels.
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Market drivers
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In 2010, the UK extended a 20p per litre duty differential for sustainable biodiesel until 2012. The UK government had intended to abolish the incentive because it was difficult to administer but decided that it would apply only to biodiesel made from used cooking oil. Biodiesel produced from plant-based feed-stocks attracts the same fuel duty as petrodiesel. Italy has been at the forefront of encouraging natural gas vehicles and provides incentives of 500 for conversion to LPG and 650 for natural gas. Conversion prices for cars range from 1,400 to 2,400. The Czech Republic waives purchase tax and road tax from vehicles up to 12 tonnes that run on compressed natural gas.
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Chapter 2: Market barriers
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Market barriers
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MARKET BARRIERS
Production volumes
A 2009 study by Lux Research found that to produce biofuels in volumes equivalent to the worlds use of petroleum, the area of cultivated crop land required would be around the total size of Russia. Furthermore, even crops that are viable on non-arable land will put unsustainable demands on water resources, which are already approaching crisis in many areas. According to the Global Renewable Fuels Alliance, global production of ethanol in 2010 increased 16% over 2009 output to reach more than 85 billion litres, of which the US produced more than 45 billion litres. Global ethanol output displaced the need for around 350 million barrels of oil alongside the global demand for 85 billion barrels. However, to put this into perspective, the 2010 global output of fuel ethanol equals 535 million barrels while road transport used around 17.4 billion barrels. In other words, global fuel ethanol accounted for around 3% of 2010 transportation fuel without adjusting for the fact that ethanol has a lower thermal value than gasoline or diesel. Of the four major ethanol producers - the US, Brazil, the EU and China - three will almost certainly be unable to meet their own internal ethanol demand despite crop output increases. Only Brazil, which is predicted to have an export capacity of around six billion litres per year by 2010 (increasing to 12 billion by 2030), is seen as becoming a major exporter of ethanol. According to Agricultural Outlook, global production of biodiesel in 2010 stood at around 21 billion litres, or 132 million barrels, which is equivalent to around 0.75% of the 2010 global demand for transportation fuel. The EU is the largest biodiesel producer, accounting for around 65% of global output. The low capacity utilisation has recently been attributed to subsidised US and Argentine biodiesel entering the market and the restrictive limit of a maximum blend of 7%. The US is also producing at well below installed capacity through a lack of meaningful incentives other than the federal mandate to use 1.15 million gallons and US$1 per gallon tax credit. In 2010, there were 173 biodiesel plants in the US with production capacity for 2.7 billion gallons. Canada has 12 biodiesel plants that are expected to be able to supply 550 million litres to meet its B2 standard. Argentina has been exporting its entire production but domestic use has increased markedly since the mandated blending of 5% then 10% in the countrys diesel fuel began during 2010. It had installed capacity for 2.37 million tonnes in 19 plants in 2009. Brazil, on the other hand, used its entire production of 2.35 billion litres under its B5 blending mandate and has installed capacity for 4.6 billion litres. Colombia is South Americas largest palm oil producer and biodiesel production capacity was around 500,000 tonnes in 2009. According to Eurostat, at least 28 countries within the Euro region produce biogas, and production increased 56% between 2006 and 2008 to the equivalent of 7,585 tonnes of oil. Future capacity for biogas production in Europe is forecast at 20% or more of the overall energy consumption by the transportation sector. The EU has developed standards that biogas must meet before it can be fed into the natural gas supply infrastructure.
Supply infrastructure
While synthetic gasoline and diesel, biodiesel and small proportions of ethanol can readily be blended into conventional gasoline and diesel and distributed via the existing infrastructure, most other alternative fuels require significant additional investment in new distribution infrastructure. As at 31 March 2011, E85 was sold at only about 2,349 of the 170,000 gasoline stations in the US and they are concentrated in the upper Midwest, while many states have fewer than twenty E85 stations.
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Figure 3: E85 station distribution by US state
Source: US Department of Energy
As of the same date, there were 615 stations in the US selling B20 (led by North Carolina, some nearby states and the Pacific seaboard states), 870 selling CNG (led by California and New York), 40 selling LNG, 2,582 selling LPG (led by Texas, California and Alabama) and 58 selling hydrogen (California and eastern seaboard). Distribution maps similar to the one above are available on the same website for each fuel type. In Europe, CNG refuelling stations are concentrated around Figure 4: Existing or planned hydrogen refuGermany, Denmark, The Netherlands, Belgium and eastern France elling stations in Europe with other clusters in southern Sweden, southern Finland and Bulgaria. Similarly, while still a long way from constituting comprehensive networks, the establishment of hydrogen refuelling infrastructure in Europe is accelerating with plans for hydrogen highways from Norway and Sweden to Portugal and Italy, many of which will use renewable sources of electricity for electrolysis production. Again, Germany has become something of a central demonstration location for hydrogen transportation with an extensive list of automotive OEMs and energy companies constituting the Clean Energy Partnership. In January 2011, a group of gas suppliers and oil companies in Japan announced plans to install 100 hydrogen refuelling stations across the four major metropolitan areas of Aichi, Fukuoka, Osaka and Tokyo by 2015. Until recently, there have been only about 12 refuelling stations in Japan, five of which were within the Tokyo metropolitan area. Hydrogen is produced at the stations by reforming coke gas, gasoline, kerosene, LPG, methanol, naphtha and Source: Hydrogen Cars Now natural gas, and by electrolysis.
Actual greenhouse gas emissions reductions

At first glance, most of the alternative fuels under consideration offer significant reductions in GHG emissions, especially the biofuels that are produced from plant and other biomass that has absorbed CO2 while growing. However, for realistic comparisons, a full well-to-wheels (WTW) assessment of all the GHG emissions that result from all aspects of extraction, production and transportation must be included.
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In 2009, Cornell University published a study that drew on the work of 75 scientists from around the world which concluded that the then current mandates and targets for liquid biofuels should be reconsidered in the light of potentially adverse environmental consequences, potential competition with food crops and difficulty meeting the goals set without large-scale land conversion. The study concluded that biofuels produced from organic waste and cellulosic feed-stock from short-rotation forestry and grasslands were more environmentally advantageous than those produced from food crops but that biomass could be used more efficiently through direct combustion to generate electricity and heat than it could through conversion to liquid fuels. The latter conclusion is consistent with calculations made by Professor Elliott Campbell of the University of California and published in Science, that using biomass to generate electricity to power electric vehicles is three times more efficient than using it to make cellulosic ethanol for use as fuel, largely because an electric motor is much more efficient than an internal combustion engine. Professor Elliott calculated that an electric vehicle would travel 81% further than an ethanol-powered one on the energy derived from the same quantity of biomass. Furthermore, the electric vehicle offset 108% more GHG emissions that the ethanol-powered one.
Biofuels
Estimates for the GHG emissions savings provided by using biofuels vary considerably, partly because of the varied feed-stocks and methods of production, the complexity of the task and the incomplete knowledge base. Nevertheless, some exhaustive efforts to determine the lifecycle GHG savings have been undertaken by, for example, the US EPA and consultancies such as (S&T)2 Consultants. A 2009 report published by (S&T)2 found that world production of biofuels exceeded 100 billion litres that year, displacing 1.15 million barrels of crude oil per day and saving 57% of the GHG emissions that the petroleum-based fuels would have created. This appears to address concerns expressed in recent years regarding, for example, the underestimation of the use of fertilisers and the resultant nitrous oxide emissions. Furthermore, it has been pointed out that food crops yields have been increased by as much as 30% during the last decade and researchers continue to develop processes that reduce energy intensity and emissions, such as the BPX process developed by Poet in the US that eliminates much of the heat required in ethanol production. Other concerns regarding biofuels include that extra crops require extra water, a resource that is already under pressure in many regions, and that incentives provided for biofuel production encourage farmers to shift from food crops to fuel crops and to clear forests for cropping land, removing the associated carbon sinks and releasing methane and NOx during burning and decomposition. Such land use changes have been implicated as major sources of GHG emissions. Studies published in Science in February 2008 indicate that a US cornfield devoted to producing ethanol would not achieve a net reduction in GHG emissions for 167 years, and that clearing Brazilian rainforest or Indonesian peat land for biofuel crops would not achieve net reductions for 319 years and 423 years respectively. A study conducted at Princeton University estimated that devoting 12.8 million hectares of cornfields in the US for ethanol production would result in an increase of 10.8 million hectares of additional cultivated land throughout the world, much of which would result in the felling of forests and the cultivation of grasslands.
Bioethanol
Using ethanol in an internal combustion engine (ICE) results in lower CO2 emissions than gasoline because of the lower carbon intensity of ethanol and higher engine efficiency. However, on a WTW basis, the most optimistic estimates for temperate-climate, first-generation bioethanol is a 40% saving in GHG emissions, although more pessimistic experts suggest it may be only 10% less than gasoline. Typically, bioethanol is credited with around 20% savings with rapeseed (canola) ethanol at around 13% and corn-based at around 18%. Second-generation bioethanol, however, such as cellulosic ethanol from switchgrass, can offer greater savings over gasoline. Coskatas bioreactor process is believed to reduce WTW CO2 emissions by up to 84%. However, a 2009 study by Cheminfo Services for the Canadian Renewable Fuels Association using the Natural Resources Canada GHgenius lifecycle assessment model to analyse eight Canadian ethanol plants found that a unit of energy produced using the ethanol resulted in 62% of the GHG emissions released by generating a unit of energy with gasoline a 38% reduction.
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Biobutanol
Cobalt Technologies, which produces biobutanol, claims that it achieves an 85% reduction in GHG emissions compared to gasoline.
Biodiesel
Biodiesel is generally credited with GHG savings of around 50% and Daimler Trucks claims 60% for biodiesel produced from renewable palm oil feed-stock. However, others suggest that it can actually increase GHG emissions when land use changes and fertiliser use are taken into account. A 2009 study by the US National Biodiesel Board and Indigenous Energy claimed that using soy-based biodiesel reduced CO2 emissions by 78% compared to petrodiesel although the claimed lifecycle basis appears to include only an estimate of the CO2 absorbed by the soy as it grew. A US DOE study found that the production and use of biodiesel, compared to petrodiesel, resulted in a 78.5% reduction in CO2 emissions, which is consistent with the 78% reduction claimed by the US National Biodiesel Board. The UK Department of Transport calculated the emissions from biodiesel produced from different feed-stocks grown in different countries but used in the UK, and found that palm oil from Indonesia or Malaysia ranked lowest at 38 grams of CO2 per megajoule (g/MJ) of available energy. This represents a 56% reduction in CO2 emissions when compared to petrodiesel at 86g/MJ. Soy biodiesel ranged from 42g/MJ (-51%) for Argentine crops to 73g/MJ (-15%) for Brazilian soy. Rapeseed oil biodiesel ranged from 45g/MJ (-48%) for Polish crops through to 63g/MJ (-27%) for rapeseed from Australia, with UK-sourced rapeseed producing 55g/MJ (-36%). However, a document obtained by Reuters from the EU in 2010 under freedom of information laws indicated that GHG emissions by soy-based biodiesel, including all indirect emissions, could be as much as four times greater than those from petrodiesel while emissions from rape seed-based biodiesel are about 76% higher than for petrodiesel.
Natural gas
Although it is a potent GHG in its own right, methane is the least carbon intensive fossil fuel and its use results in CO2 emissions that are up to 30% lower than gasoline and 45% lower than coal.
Liquefied petroleum gas

LPG is less carbon intensive than gasoline or diesel and produces 15% to 20% less CO2 per equivalent energy released.
Hydrogen
The use of electrolysed hydrogen in an ICE can be CO2-free as long as the electricity supply is CO2 free, which is essentially the case in Iceland and Sweden, for example. However, if it is produced by electrolysis from electricity produced using fossil fuels, which is the case for 72% of electricity in the US, for example, with about half from coal, the in-use CO2 emissions would be around twice that of gasoline. If the hydrogen was used to power a fuel cell vehicle with the 70% thermal efficiency that Honda has recently claimed for its Clarity model, once ancillary and driveline losses are factored in, the CO2 emissions from SMR hydrogen would be about 120g/km, but from electrolysed hydrogen in countries with predominantly fossil-fuel electricity, they would considerably exceed those produced by using gasoline in an ICE.
Synthetic fuels
Rentech has claimed a 30% reduction in GHG emissions for its GTL synthetic diesel, based on trials using an Audi A3 TDI, and 97% if it is produced from biomass and waste resources. The company also claimed a fuel economy increase of between 20% and 50%. However, the US DOE and the Argonne National Laboratory conducted a study to estimate the total GHG emissions of CO2, methane and N2O resulting from the production and transportation use of synthetic fuels. For diesel fuels, the baseline GHG of ULSD was estimated at 95g/MJ and GTL diesel was found to release 105g/MJ (+10.5%), coalto-liquids 220g/MJ (+132%) and biomass-to-liquids 15g/MJ (-84%).
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The study using a baseline of 23.2mpg (US) (10.1 litres/100km) for a gasoline-powered car and assuming a 20% improvement with diesel power calculated similar results by setting WTW GHG emissions at 250g/km for ULSD. GTL diesel emissions were calculated at 290g/km (+16%), coal-to-liquids 600g/km (+140%) and biomass-to-liquids 50g/km (-80%).
Overview
The Argonne National Laboratory has calculated the WTW CO2 emissions associated with all major alternative fuels compared to petroleum gasoline, for light vehicles in the US, including fuel cell vehicles (FCV) and electric vehicles (EV). Table 2: WTW CO2 emissions by fuel source for US light vehicles
Fuel source Current US gasoline vehicle Future US gasoline vehicle Direct injection diesel vehicle Gasoline-electric hybrid Diesel-electric hybrid Natural gas ICE Natural gas to hydrogen ICE Natural gas to hydrogen FCV Ethanol from corn E85 ICE Cellulosic ethanol E85 ICE Ethanol to hydrogen ICE Ethanol to hydrogen FCV Hydrogen from US grid FCV US grid EV Source: Argonne National Laboratory g/mile 476 373 325 270 243 294 302 183 286 103 206 103 492 230 g/km 296 232 202 167 151 182 187 113 178 64 128 64 306 143
Figure 5: WTW CO2 emissions by fuel source for US light vehicles (g/mile)
Source: Argonne National Laboratory
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In 2010, in order to compare lifecycle GHG savings of different automotive manufacturing materials, WorldAutoSteel used the Phase 2 UCSB Green House Gas Comparison Model to compare the use of the different materials on vehicles using different fuels. The results for a conventional, steel-bodied, C-segment car are in the table below. Figure 6: Lifecycle CO2 emissions (tonnes) by fuel source, C-segment car
Fuel source Cellulosic E85 Soy B99 Hydrogen FCV Hybrid-electric Soy B20 Corn E85 Petrodiesel Gasoline CO2 13 20 25 28 32 34 35 38
Source: WorldAutoSteel
Reduced fuel storage and operating range

While ethanol, biodiesel, LPG and DME can be stored as liquids at normal temperatures, CNG and compressed hydrogen require bulky, heavy gas cylinders and storing fuel as gas provides limited operating range before refuelling is necessary. Even E85 provides a shorter driving range because of its lower thermal content than gasoline. Taking the range achievable on petrodiesel as a baseline, using gasoline in the same sized fuel tank typically results in a range reduction of about 25%; E85 about 43%; CNG about 56%; and gaseous hydrogen in an ICE about 76%. The stored thermal capacity of hydrogen and natural gas can be increased markedly if they are liquefied, but this requires high pressure, the use of highly-effective insulation and the consumption of energy to maintain extreme refrigeration, sophisticated fuel tanks and comprehensive safety systems to release or collect boiled off gas. Both hydrogen and natural gas are highly volatile and form explosive mixtures with air, and natural gas is also mostly methane, which is a GHG. For hydrogen, the possibilities for solid-state storage are the subject of several research projects including the use of ammonia borane and aluminium hydride, also known as alane. Another alternative has been developed by Asemblon, which is promoting a hydrogen-rich liquid chemical called Hydrnol that is stable at normal temperatures and pressures so that it can be transported and stored like conventional automotive fuels. The hydrogen can be extracted through the use of a heated catalyst within the tank, leaving spent liquid that can be pumped out during the next refuelling for recycling.
Competition with food

In 2008, concerns were raised that food crops and arable land were being diverted to the production of biofuels and causing the rapid rises in food prices at the time. In response to this, UN and EU officials called for a moratorium on increases in mandated biofuel content and the UN secretary general, Ban Ki-Moon, called for a comprehensive review of biofuels policies. Subsequent analyses, including one by the World Bank, found that using crops for biofuAlternative fuels and the global auto industry (2nd edition) automotiveworld.com
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els was a small factor among several that were causing food price increases, such as increasing demand from developing countries, droughts in important growing regions, increasing meat and animal feed demand in developing countries and high energy prices affecting production and transportation. The US National Biodiesel Board (NBB) asserted that the growth of the biodiesel industry in the US is leading to higher production of lower-cost food protein because biofuel production uses only the oil from soybeans, with the remaining 80% of the bean providing protein meal for livestock and human consumption. The NBB also pointed out that the US biodiesel industry is advancing feed-stock development by adding yield to existing oilseed crops and promoting non-food production. Similarly, the ethanol industry takes only the starch out of corn and puts the protein, fibre and oils into what is known as dried distillers grains. Adding further support, the Oak Ridge National Laboratory found that corn ethanols contribution to indirect land use change is minimal to zero.
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Chapter 3: Market dynamics and forecasts
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MARKET DYNAMICS AND FORECASTS

The global markets for alternative fuels and alternative-fuel vehicles differs from region to region, at least in part because of the local availability of specific feed-stocks but also because of factors such as local air quality concerns and regional preferences in fuel type. For example, the growth of biodiesel has been led by Europe in part because of the high preference among European consumers for diesel vehicles, whereas Brazil has been the leading ethanol producer because of its capacity to supply sugar cane. The US has opted for ethanol, and to a lesser degree biodiesel, because its dominant local crops of corn and soybeans were originally considered ideal for ethanol and biodiesel production. Sweden is pursuing increased production of cellulosic ethanol because of its stock of forests, and is promoting electric vehicles because its electricity supply is almost completely carbon neutral. France, too, is promoting electric vehicles because about 80% of its electricity is nuclear-generated. India is promoting CNG and California hydrogen, because of the need to address air quality issues in their large urban areas, whereas Iceland is opting for a hydrogen economy because its carbon-neutral, geothermal electricity supply enables the hydrolysis of hydrogen. In 2009, Harts Global Biofuels Center forecast that global biofuel use would double by 2015 and that US use would increase by 35% during that period while Asia-Pacific ethanol production will increase to account for as much as 20% of global production by then. The report also forecast that the global demand for ethanol will represent 12% to 14% of the global gasoline demand. However, the report predicted that of the approximately 170 next-generation biofuels projects around the world at that time, only 30% will be operational by 2015. That same year, Data360 forecast that the global biofuel market would reach US$80bn by 2016, accounting for more than 30% of the renewable energy market of US$226bn. In December 2010, Pike Research forecast that worldwide investment in biomass infrastructure will maintain steady growth through to 2016, by which time the global market will be worth US$33.7bn compared to US$28.2bn in 2010. Pike Research points out, however, that the biofuels sector will not grow as rapidly as the bioenergy and bioproducts sectors until second- and third-generation cellulosic technologies are available on a commercial scale, which is expected to occur by around 2013.
Alcohols
Accenture, a global management consulting, tech- Figure 7: Global ethanol production forecast to 2019 nology services and outsourcing company, has (billions of litres) benchmarked the underlying markets of bioethanol and biodiesel in some 20 countries, including China, India and the US and forecasts that both ethanol and biodiesel production will increase to three to four times their current levels by 2020. Brazils Food and Agriculture Policy Research Institute has forecast that global ethanol production will increase to 122.39 billion litres by 2017. According to Agricultural Outlook, global ethanol production will increase from around 93 billion litres in 2010 to 131 billion litres in 2015 and almost 160 billion litres in 2019. Source: Agricultural Outlook CSM Worldwide has forecast that the production cost of ethanol from cellulosic biomass will fall from the 2005 cost of US$2.26 per gallon to US$1.07 in 2012 and US$0.59 by 2020 as a result of improving production efficiencies and lower raw material costs.
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Biodiesel
Because of factors such as revised blending targets and the burgeoning demand for cooking oil in Asia diverting palm oil from fuel production, the installed capacity for biodiesel production worldwide considerably exceeds current production. However, with increasing use of waste and biomass, and with new sources such as Indias jatropha project coming on stream, Agricultural Outlook has forecast that production will increase from about 21 billion litres in 2010 to 32 billion litres by 2015 and 41 billion litres by 2019.
Figure 8: Global biodiesel production forecast to 2019 (billions of litres)
Source: Agricultural Outlook
LPG is produced from the light distillates of oil, Figure 9: Global light distillate consumption (1,000 global production of which averaged 27,173 thou- barrels per day), 2005 2009 sand barrels per day in 2009, a decrease of 1.4% from 2008. Of this, North America consumed 39.8% (US 33.9%), Asia-Pacific 28.8% (China 8.8%, Japan 6.2%), Europe 12.2%, Latin America 6.7%, the Middle East 5.8%, the former Soviet Union 4.1% and Africa 2.6%. Although global consumption is likely to advance on 2008 volume as economic recovery occurs, US consumption of LPG is expected to remain flat during the next few years with only slight increases Source: BP Statistical Review of World Energy, 2010 in 2014 and 2015.
Natural gas
Global natural gas consumption has been growing at Figure 10: Global natural gas production (billion cubic around 2.5% per year although it declined 2.1% in metres), 2005 2009 2009. In 2010, natural gas vehicles consumed around 43.4 billion cubic meters of gas, or about 1.5% of global production. In energy terms, that is equivalent to only 37.3 million tons of crude oil, or around 1.0% of global oil production, of which transportation consumes about 55%. In 2009, Pike Research forecast that the number of natural gas vehicles on the worlds roads would increase from 9.7 million in 2008 to 17 million by 2015, at which time annual sales are expected to Source: BP Statistical Review of World Energy, 2010 exceed three million. In January 2011, Pike reaffirmed this forecast by predicting that natural gas vehicle sales will grow at a compound annual growth rate of 7.9% to reach 3.2 million in 2016. The company also forecast that natural gas refuelling stations worldwide would increase from 18,000 in 2010 to around 26,000 in 2016.
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According to the Natural Gas Vehicles Association of Europe, there were more than 13 million natural gas-powered vehicles on the worlds roads in 2010 and the International Association for Natural Gas Vehicles forecast that by 2020 there will be more than 50 million, accounting for more than 9% of the worlds road transportation fleet.
Hydrogen
In 2010, Freedonia reported that the hydrogen market was worth US$39bn and forecast that it would increase by 3.4% per year through to 2013, by which time global production would be 475 billion cubic metres. Demand for hydrogen is growing fastest in the Asia-Pacific region, which is expected to increase its share of global consumption from 30% in 2008 to 33% in 2012 while the North American share will decrease from 30.5% to 28% and the Western European share from 18% to 16%. Petroleum refining accounts for around 89% of global hydrogen demand, while ammonia and methanol production account for 6%.
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Chapter 4: Alternative fuels
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ALTERNATIVE FUELS
Table 3: Feed-stock to fuel type
Feed-stock Fuel Crude oil Natural gas Coal Corn Sugar crops Vegetable oils Other biomass Algae Biogasoline Biogasoline Gasoline X Synthetic Synthetic Biogasoline Biogasoline Biodiesel Biogas Biogas X X X X X X X X X X X X X Biodiesel Biodiesel Diesel X F-T diesel F-T diesel Biogas Biogas X X CNG LNG LPG X X X X X X X X Methanol Ethanol Butanol X X X X X DME Hydrogen
Cellulosic biomass Biogasoline F-T diesel
Algal biofuels
The production of biofuels using natural and engineered strains of algae is currently one of the leading edges of sustainable fuel technology, with a variety of approaches being investigated in outdoor ponds or closed photo-bioreactor environments. The water used can be fresh, salty or waste and the algae are supplied with nutrients from a variety of feed-stocks to combine with either ambient or industrial-sourced CO2 to form hydrocarbons that can be refined into fuel products such as biodiesel, methanol, ethanol or biogasoline. The feed-stocks used include those used for other biofuel production such as food crops and other biomass including animal and human waste, and industrial by-products such as glycerol. In 2010, Bloomberg reported that at least 75 developers around the world are investigating the use of algae in producing fuels. A SunEco Energy project in California provides an example of an open pond operation, in which 200 acres of ponds at a disused fish farm are supplied with brackish water similar to seawater and a variety of nutrient feed-stocks. According to SunEco, yield of the biocrude is around 33,000 gallons per acre per foot of water per year. Photon8, a Texas venture, claimed in January 2011 that it had developed a low-cost system capable of producing up to 10,000 gallons per acre per year at a cost of US$1.25 per gallon. In 2009, BioFields announced that its Aurora Biofuels algae-based production system in Florida, using industrial-source CO2, was capable of producing 6,000 gallons per acre per year at a cost equivalent to US$50 per barrel. Closed photobioreactor systems avoid the contamination and evaporation problems that open systems can encounter and are better able to utilise CO2 in flue gases from industrial sources such as coal-fired power stations. They also enable closed-loop monitoring and control of light and temperature conditions and nutrient concentrations. OriginOil of California and MBD Energy of Australia have a closed system that they claim has the capacity to produce 11 million litres of oil per year from 80 hectares of algae production alongside each of MBDs power stations. Algae.Tec claims 32,000 gallons of production per acre per year from its Perth, Western Australia, system that uses industrial CO2 and sunlight via fibre optics. ExxonMobil and Synthetic Genomics opened a greenhouse facility in California in 2010 as a next step in their joint research into algae biofuel production. In the new facility, they will investigate different algae strains in different growth systems under a wide range of conditions, including different temperatures, light intensities and nutrient concentrations. They will also investigate different harvesting and recovery methods.
Cyanobacterial biofuels
Cyanobacteria can also be used to photosynthesise CO2 and water into ethanol or hydrocarbons and are less complex organisms than algae and hence easier to genetically manipulate. One company that has genetically engineered a cyanobacterium strain to produce the ingredients of biofuel, Joule Unlimited, claims that its process is capable of
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producing 15,000 gallons of diesel per acre per year at a cost of around US$30 per barrel. A major challenge, however, remains in terms of retrieving the relatively small quantity of product from the water. At least two major oil companies, ExxonMobil and BP, are supporting research initiatives into the use of cyanobacterial biofuels by Synthetic Geonomics and Arizona State University, respectively.
Alcohols
Methanol, ethanol, propanol and butanol are all clear liquids that burn cleanly with energy densities that range from about half that of gasoline to about 92% for butanol. They all have high octane ratings, produce low levels of toxic emissions, provide good driving performance and range and can be used in engines developed for gasoline with only minor modifications to the fuel and ignition systems, although increasing the compression ratio will better utilise the higher octane ratings. While methanol is relatively volatile and toxic, the other three can be easily transported and stored in conventional liquid fuel facilities. However, ethanol absorbs water, which causes problems in reticulating pipe systems and the inefficiencies in the production of propanol rule it out as a mass-market fuel. The other three can readily be blended with gasoline and ethanol and butanol can be blended in small proportions with diesel and biodiesel. Alcohols can also be used, via reforming, to produce hydrogen for fuel cells. Corrosion inhibitors must be added to methanol and ethanol because they contain contaminants that cause corrosion of metal fuel system components and degradation of some older polymer components. Both also exhibit higher conductivity than gasoline, increasing galvanic corrosion so that fuel level sensor wires must be fully insulated and the sensor must be of the pulse-and-hold type.
Methanol
Methanol is the lightest alcohol with energy density of about 16 MegaJoules per litre (MJ/litre) despite which it has been used as an ICE fuel for many years, particularly in motor sport because of its high octane rating of 136 RON. However, its toxicity, its colourless flame and the tendency for its highly volatile vapour to remain near the ground if it is spilled make it unsuitable as a mass-market automotive fuel. Nevertheless, Lotus developed an Exige demonstrator that can run on gasoline, ethanol or methanol and several Chinese OEMs, including Chery, Geely and Shanghai Maple produce vehicles that can use methanol or blends of up to 85% methanol and 15% gasoline. Currently, most methanol is produced from natural gas via the syngas process. It can also be produced via the anaerobic digestion of algae, although the process has not been developed to commercial scale. Recent research indicates that it can be produced, via methane, with photo-catalysts that use light energy to reduce CO2, and also by synthesising hydrogen and CO2.
Ethanol
Ethanol has energy density of about 21MJ/litre, which is about two thirds that of gasoline and results in poorer fuel economy by volume. However, its octane rating is 129 RON, compared to about 95 RON for regular gasoline. Traditionally, ethanol has been produced by the fermentation of sugar-containing food crop biomass such as sugar cane in Brazil and corn in the US as well as wheat, sugar beet and waste from sugar refineries. However, because of poor energy balance, limited GHG savings, the substantial land areas required and competition with food supplies, research is focussing on more efficient methods of production, particularly from non-food, cellulosic sources, such as straw, leaves, stalks, citrus waste and wood waste. Some hardy grasses, such as Bermudagrass, Napiergrass and switchgrass can provide cellulosic sources for the production of ethanol. They grow prolifically almost anywhere and have a more efficient CO2 fixing process than most other biomass sources. Switchgrass has been found to deliver ethanol with around five times more energy than it consumes during growth, harvesting and manufacture, and emits significantly fewer GHGs than corn-based ethanol.
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Another promising source of ethanol is sweet Figure 11: Switchgrass sorghum, a rapidly-growing, cane-like plant with high sugar content that grows in marginal soil, requires less water than corn or sugarcane, provides a high yield of 500 to 800 gallons of ethanol per acre and requires less than half the energy required to convert corn to ethanol. Woody biomass can be used to produce ethanol, but the main challenge is the development of efficient methods to break up its fibre structure prior to processing. Mechanical, thermal, chemical and biological processes, and combinations of those, have been tried, but all remain unsuitable so far because of high costs, low yields, waste production or unwanted byproducts. Another barrier is the high cost and current low productivity of the enzyme, cellulase, which is needed to convert cellulose to glucose. Thirdly, a suitable organism for the fermentation of five-ringed sugars present in hemicellulose needs to be found or developed. Ethanol can also be produced from woody biomass via gasification followed by fermentation using anaerobic bacteria or catalytic processes. This eliminates the need for hydrolysis to break up the cellulose and hemicellulose fractions of the biomass. Other second-generation ethanol production processes have been developed to convert almost any carbon-based feed-stock into ethanol, including municipal and industrial waste, and even used tyres. Coskatas propriety process, which uses microorganisms and bioreactors, and less water than other processes, has been found to produce ethanol that provides up to 7.7 times the energy used in production, and WTW CO2 emissions reduced by up to 84% compared to gasoline. Algenol Biofuels has developed a closed process in which algae photosynthesise CO2 directly into ethanol, absorbing 1.5 tons of CO2 in the production of 100 gallons of ethanol. The company expects production to achieve 10,000 gallons per acre, which compares favourably with 360 gallons per acre from corn and 890 gallons per year from sugar cane. Blends Gasoline in Brazil contains 25% ethanol and research by the US DOE indicates that E20 is safe for use in engines originally designed for gasoline only. As a consequence, in October 2010, the US EPA issued a waiver approving E15 for use in light vehicles manufactured from model year 2007 and in January 2011, extended the waiver to those manufactured from model year 2001. However, automotive and petroleum industry lobby groups mounted a legal challenge to both the EPAs mandate to authorise E15 and the research regarding its safety. The industry groups argue that ethanol proportions greater than 10% are not safe for use in the fuel system and exhaust catalyst components on most engines originally designed for gasoline. Interestingly, because the EPA research focussed on post 2000 vehicles, the Renewable Fuels Association commissioned Ricardo to evaluate the potential impact of E15 on 1994 to 2000 models, which account for about 25% of the current in-use light vehicle fleet. The research, which sampled a representative range of vehicles available in the US during those years, was released in September 2010 with the conclusion that E15 should not adversely affect vehicles in that age group. In February, 2011, the House of Representatives voted to prevent the EPA from enabling E15 to be supplied but encountered difficulties progressing the resolution into law. At the time of writing, the EPA had issued a second waiver authorising E15 for use in designated flex-fuel vehicles but the contest continued. US OEMs, most notably Ford and GM, produce flex-fuel engines that can operate on E85, and E100 models are available in Brazil. Renault has a range of E30 and E85 dual-fuel models in France. In 2009, Ricardo announced its Ethanol Boosted Direct Injection (EBDI) engine that can operate on any blend of gasoline and ethanol from E10 to E100 with thermal efficiency equal to a diesel engine while requiring only half the equivalent displacement.
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Another ethanol blend in gasoline is ethyl tertiary butyl ether (ETBE), replacing the methyl tertiary butyl ether (MTBE) that was originally added to substitute for lead, but which was found to contaminate ground water. ETBE raises the octane rating and improves efficiency without generating additional emissions and because ETBE is biologically derived, it results in a small reduction in CO2 emissions. Unlike ethanol, it can be transported in pipelines. The EU permits blends of up to 15% ETBE in gasoline. Ethanol can be blended with diesel. O2Diesel Europe, for example, produces a 7.7% blend of ethanol with diesel along with 1% proprietary additive and a cetane improver. Ethanol-capable vehicles The production of ethanol-capable light vehicles is technologically easy and has been estimated to cost only about US$200, mostly for upgraded fuel system components although the price premium for a flex-fuel Renault Clio was 200 (US$285) in France in 2009. In order to be able to flexibly use either ethanol, gasoline or a range of blends, the vehicle requires a sensor system to recognise the fuel mixture and a variable engine ignition map, which adapts to the fuel mixture detected. The engine warm-up system must also be effective because ethanol has inferior cold starting characteristics to gasoline. In Brazil, around 90% of new vehicles are now flex-fuel and are forecast to exceed 50% of the fleet by 2013.
Butanol
Butanol is heavier than ethanol, less volatile, less corrosive and does not absorb water. Its energy density is about 29MJ/litre, more than 90% that of gasoline, and its octane rating 96 RON, making it more suitable than ethanol for blending in either gasoline or diesel. It is used primarily as an industrial solvent and although it is considered toxic, it is used in cosmetics and perfumes despite its potential to cause irritation to skin and eyes. Most butanol production is from petroleum but it can be produced from a wide range of food and non-food, cellulosic biomass feed-stocks and industrial waste products such as molasses from sugar production and whey from cheese production. The difference between ethanol and butanol production is primarily in the fermentation process and, according to DuPont, existing ethanol plants can be cost-effectively modified to produce butanol. Butanol can also be produced via algae. The fermentation process used to produce butanol from cellulosic feed-stocks is inefficient and produces an unpleasant smell, and the organism used in the process dies when the butanol content reaches 7%, whereas the yeast used to ferment ethanol dies at 14% - 16% concentration. The Wizemann process, which is named after Chaim Wizemann, who first isolated the Clostridium acetobutylicum microbe used, produces butanol, acetone and ethanol, along with isopropanol, hydrogen and acetic, lactic and propionic acids. The proportions of butanol, acetone and ethanol produced are 6:3:1, with each bushel of corn, for example, producing 1.3 gallons of butanol, 0.7 gallons of acetone and 0.13 gallons of ethanol with concentrations of only 1% to 2%. It was this fact that led to the decision to opt for ethanol as the alcohol of choice for fuel. The yeast process for ethanol production yields 2.5 gallons of ethanol per bushel of corn. Improving butanol yield is the focus of current research. Energy Environment International has developed a method in which two separate micro-organisms are used in sequence to almost eliminate the production of acetone and ethanol. Butalco has developed a method to modify yeasts in order to produce butanol instead of ethanol, and a team of students at the University of Alberta has been working to genetically modify E. coli to produce butanol by introducing the genes responsible for butanol production from Clostridium acetobutylicum. The team is also working to increase E. colis tolerance to butanol. ButylFuel has developed a process that the company claims can make butanol production from biomass economically viable to the degree that it can compete with petroleum fuels. ButylFuels process yields 2.5 gallons of butanol per bushel of corn, almost twice as much as is produced by the Wizemann process and with no acetone of ethanol. The company claims that when the hydrogen produced is also taken into consideration, the process can produce 42% more energy than corn-to-ethanol, with 25% of the gain resulting from the butanol and 18% from the hydrogen. The
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production cost by volume is similar to that of corn ethanol but the energy return higher and the cost is expected to reduce significantly with the use of cellulosic waste feed-stock. Phytonix has developed a photobioreactor system using a genetically modified bacteria that continuously secretes biobutanol in fresh or salt water and either ambient or industrial-source CO2. The company claims production potential for about 20,000 gallons per acre per year at a cost of less than US$1.00 per gallon. During 2010, researchers at Napier University in Edinburgh, Scotland, filed patent for a new process, based on the Wizemann process, to produce biobutanol from pot ale and draff, which are by-products of whiskey distillation. Another recent advance has been announced by the US DOEs Bio Energy Science Center at the University of California, Los Angeles, whereby butanol can be produced directly from cellulose by combining biomass with the fermentation of sugar and clostridium in a single-step process. Current research suggests that engines designed for gasoline can run on a blend of up to 85% without modification and that any vehicle that can use E10 can use pure butanol. A 16% blend in gasoline for use in engines originally designed for gasoline only provides comparable performance to a 10% blend of ethanol. The US EPA approves the use of up to 16% butanol in gasoline.
Biodiesel
Biodiesel has typically been produced from vegetable oils or animal fats via a chemical process known as transesterification, first patented by G. Chavanne of the University of Brussels, Belgium, in 1937. The oils or fats are reacted with methanol or ethanol to produce short-chain, mono-alkyl (methyl of ethyl) esters. Higher alcohols such as isopropanol and butanol can also be used and although the cold flow properties of the resulting ester is good, the process is less efficient. Transesterification has a positive energy balance, providing 3.24 units of energy for every unit expended during production. For every ten parts of biodiesel produced, one part by weight of glycerine is produced and some free fatty acids in the feed-stock are converted into soap, which is then removed. Glycerine can be used for methanol production or used in livestock feeds and provides a separate value chain. Properties The mono-alkyl esters produced by the transesterification process constitute a lower-viscosity fuel than pure vegetable oil that exhibits similar physical characteristics, such as viscosity, to petrodiesel. Biodiesel provides better lubricity than petrodiesel and reduces wear in injection pumps and injectors. Its flash point is higher than 300 degrees Fahrenheit (150 degrees Celsius), which is much higher than that of petrodiesel (147 degrees Fahrenheit; 64 degrees Celsius) and it has a higher cetane rating than petrodiesel. Its energy density ranges from about 33 to 36MJ/l depending upon the feed-stock used, whereas the energy density of standard petrodiesel is 42.3MJ/l. Unfortunately, biodiesel has different solvent properties to petrodiesel and will degrade natural rubber gaskets and hoses found in older (pre-1992) fuel systems, and it can break down deposits of residues in the fuel system and clog fuel filters in vehicles that have previously been run on petrodiesel. It can absorb water from the atmosphere and any remaining traces of mono- and di-glycerides in it can act as an emulsifier, enabling the water to mix in with the biodiesel which can cause problems including harder starting, increased smoke emissions, less power, earlier gelling, failure of fuel filter elements and corrosion of fuel system and engine components. Biodiesel made of rapeseed oil esterified with methanol has been found to damage diesel injection pumps and have a negative effect on the life of various plastic components in fuel systems. The temperature at which biodiesel starts to gel depends on the feed-stock used. For example, biodiesel produced from some varieties of rapeseed oil starts to gel at 14 degrees Fahrenheit (-10 degrees Celsius) whereas that produced from tallow gels at around 68 degrees Fahrenheit (16 degrees Celsius). There is a very limited range of products that
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will significantly lower the gel point of pure biodiesel but blends that are mostly petrodiesel do not need any extra treatment to prevent the biodiesel content from gelling. An alternative approach to that of using additives to prevent gelling is that of heating the biodiesel to ensure an appropriate viscosity. This can be achieved through the use of two fuel tanks for petrodiesel and biodiesel, and using heating elements in the biodiesel tank that make use of the engines coolant system. The vehicle is started on petrodiesel and operated until the biodiesel has reached the required temperature and viscosity, and then switched over to biodiesel. Biodiesel also has a tendency to oxidise that also varies depending upon the feed-stock used. For example, rapeseedand palm oil-derived fuels are relatively stable but biodiesel produced from sunflower or cottonseed tends to be highly unstable. Oxidation can lead to sediment formation, filter blocking, injector nozzle coking and fuel system corrosion. There is a range of stability improvers to help reduce the oxidation problem. Feed-stocks The range of vegetable oils and animal fats that can be used as feed-stock for biodiesel include: rapeseed, soybean, sunflower, palm, mustard, flax, hemp and jatropha oils; waste vegetable oil from commercial cooking businesses; and tallow, lard, yellow grease, chicken fat and the by-products of the production of fatty acids from fish oils. In the US, biodiesel is mainly produced from soybean oil but in Europe the main feed-stock is rapeseed oil. In tropical countries, palm oil is used and a promising feed-stock is the jatropha tree, which grows quickly, is hardy, establishes itself easily even in arid land, and is drought-tolerant, requiring only 300mm of annual rainfall. It grows especially well in South and West Africa, and South-East Asia. Jatropha beans can produce oil yields of up to 40% and each tree can produce an average of 3.5kg of beans each year, depending on irrigation levels. If 2,200 jatropha trees are planted per hectare, each hectare could yield about 3,000 litres of biodiesel per year. Modular jatropha biodiesel refineries that are the size of a shipping container have been developed, and can produce up to eight million litres of biodiesel per year. Figure 12: Biodiesel plant built into a shipping container Table 4: Estimates of the yield potential of different vegetable oil crops per acre vary considerably:
Palm oil Coconut Jatropha Rapeseed Soybeans Peanut Sunflower 508 gallons per acre (gpa) 230gpa 200gpa 102gpa 60 99gpa 90gpa 82gpa
Source: BioKing
The North American Camelina Trade Association, which includes 13 seed companies, researchers and processors of camelina, a member of the mustard family and a distant relative to canola, assert that the plant is ideal for biodiesel production because it has high oil content and is fast-growing, short-seasoned, and requires less water and fewer inputs than many crops.
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The US DOE has estimated that algae can produce biodiesel with between seven and 30 times the energy per acre than soybeans and would require less than one seventh of the area currently used to grow corn in the US to provide sufficient algal fuel for the entire country. However, concerns have been raised by researchers regarding the poor energy balance achieved, largely because of the energy required for pumping large volumes of water during the process, which typically yields about one litre of biocrude per 30 cubic metres (tonnes) of water. Some estimates place algal yield many times higher than the DOEs estimate. For example, Colorado-based Solix Biofuels and Colorado State University, which are working together on an algal biodiesel project, claim that biodiesel yield can be 100 times better than that produced by conventional agricultural crops. The DOE and other production estimates have been for open pond production, whereas closed system production can use less robust algae that provide higher oil output and avoid the problem of contamination by airborne organisms. Blends Biodiesel can be used neat or blended with petrodiesel for use in a diesel engine, although the use of pure biodiesel has been associated with some performance problems and additives may be required to prevent gelling at colder temperatures, depending upon the feed-stock used. Blending of 1% petrodiesel to produce B99 (99% biodiesel) provides toxicity sufficient to prevent the development of mould in the fuel. Blends of 20% biodiesel with 80% petrodiesel (B20) can generally be used in unmodified diesel engines and in November 2010, the US EPA authorised the biodiesel produced by Amyris to be mixed up to 35% for commercial sale. Studies in the US have found that B20 provides similar fuel economy to petrodiesel. While the increasing global production of biodiesel holds the promise of displacing some of the worlds use of petrodiesel, it currently seems that it will amount to only a minor proportion of the diesel fuel required. In the US, for example, to grow enough soybeans to provide the US with its diesel fuel needs, the entire arable land area of the country would be required, and if rapeseed was the feed-stock, two-thirds would be required. However, as mentioned above, production by algae could be 30 times more efficient and could be confined to non-arable land. Environmental issues Unlike petrodiesel, biodiesel is non-toxic and biodegradable. According to a US DOE study completed at the University of California at Davis, the use of pure biodiesel instead of petroleum-based diesel fuel could offer a 93.6% reduction in cancer risks from exhaust emissions exposure. However, in Indonesia and the Philippines, the clearing of forests for growing palm oil is causing the displacement of indigenous peoples and is threatening the already shrinking populations of orang-utans in Borneo and Sumatra. The use of pesticides when growing biofuel crops is also polluting water supplies. New production processes Biodiesel is primarily produced in batch reactors that require one to four hours to process the feed-stock and alcohol into biodiesel and glycerine. However, ultrasonic production enables in-line processing that achieves yields in excess of 99% and reducing the processing time of a batch quantity to less than 30 seconds. More importantly, the ultrasonic process reduces the separation time from five to ten hours to less than one hour and helps to decrease to amount of catalyst required by up to 50% due to the increased chemical activity. It also reduces the amount of excess alcohol required and increases the purity of the glycerine. California-based Amyris Biotechnologies has pioneered a way of using common microbes and enzymes to produce a whole range of specialised hydrocarbons, including gasoline, diesel and aviation spirit. The Amyris process uses isoprenoids, which are by-products that result from cracking naphtha or oil, but which are also found widely in plants and animals. Amyriss hydrocarbons are engineered to have precisely the same molecular structure as their oil-based equivalents, except that the synthetic diesel is more pure and reduces toxic emissions by up to 80% compared with petrodiesel. Benefuel has developed a process that uses a solid catalyst. Conventional biodiesel processes use sodium or potassium hydroxides as catalysts to transesterify oils and fats. The hydroxides are consumed during the production
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process, and must be washed from the product. However, Benefuel's technology can convert a wide range of vegetable oils, animal fats or waste cooking oils directly into fatty acid methyl esters without the need for expensive pre-processing or post-process washing. Augsburg College and SarTec Corporation developed a production method called the 'Mcgyan Process', after the three scientists credited with the discovery, McNeff, Gyberg and Yan, which resulted in the founding of Ever Cat Fuels production plant in Minnesota. The process can utilise a much wider range of feed-stock oils and animal fats, including the by-products from ethanol production. It recycles the catalyst and alcohol, reduces the reaction time from hours to seconds and does not use water or dangerous chemicals. Choren Industries established what it claimed to be the world's first commercial production plant for converting biomass into synthetic diesel fuel in Freiburg, Germany. The plant is designed to produce up to 18 million litres of high quality synthetic diesel per year using the Fischer-Tropsch process. It will use mainly non-food biomass such as forest residues and waste timber, and the company claims that, compared to rapeseed biodiesel, the process requires less than one-third of the land area. Biodiesel can also be produced from wet biomass feed-stocks such as beet pulp or sewage sludge through a process known as hydrothermal upgrading (HTU). At 575 to 660 degrees Fahrenheit (300 to 350 degrees Celsius) and high pressure, the biomass is converted to a heavy organic liquid containing a mixture of hydrocarbons. This 'biocrude' can be refined into a fuel similar to petrodiesel. The HTU diesel process is being developed in the Netherlands but is understood to be some years away from commercial application.
Biogasoline
Biogasoline is gasoline produced from the same biomass feed-stocks used to produce ethanol and the other alcohols. Because it is almost identical in composition to petroleum gasoline, biogasoline can be substituted for or blended with petroleum gasoline, eliminating the need for a separate distribution infrastructure. Furthermore, ICEs that have been manufactured to operate on gasoline require no modifications in order to run on it. Global Clean Energy of Canada and Virent Energy Systems of the US in collaboration with Shell have developed catalytic processes for converting sugars into biogasoline, while several other US companies, including Amyris, LS9 and Synthetic Genomics, are using genetic engineering to modify bacteria such as the common E. coli to produce and excrete carbon chain compounds. The companies claim that they can produce hundreds of different hydrocarbon molecules, including crude oil or other more specific petroleum products including gasoline and diesel, with the advantage of the product containing no contaminants such as sulphur compounds. Biogasoline production processes are claimed to be more efficient than producing ethanol because biogasoline has an energy density that is about 30% higher than ethanol, which requires up to 65% more energy to produce.
Dimethyl ether
DME is also known as methoxymethane, oxybismethane, methyl ether and wood ether. It has the chemical formula CH3-O-CH3 and the same empirical formula as ethanol, C3H6O. It is a colourless, biodegradable, non-corrosive gas with a distinctive odour and a boiling point of -9.4 degrees Fahrenheit (-23 degrees Celsius). It is widely used as an aerosol spray propellant and is also used in conjunction with propane for cryogenic freezing. It is highly volatile and can form explosive mixtures when released into the air. DME is a clean-burning alternative to LPG, LNG, diesel and gasoline. It has similar properties to LPG and could use the same, or a similar, distribution infrastructure. Its higher boiling point makes it easier to store and transport than LNG. In gasoline engines, it can be used in a blend with LPG. Its high cetane number of 55, which is higher than diesels 38 to 53, means that it works well in diesel engines and engine noise levels are lowered. DME can be produced from natural gas, coal or biomass, typically via the production and dehydration of methanol
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or through the more efficient syngas synthesis process from hydrogen and CO. DME production from biomass or coal requires various preparation processes, such as chipping the biomass or producing coal slurry from which to gasify the feed-stock, followed by scrubbing and purification processes. Production from natural gas or LPG involves a simpler reforming process to produce methanol, which is then converted to DME, or used to produce syngas for DME synthesis. It can be produced from lignocellulosic biomass and the Danish company, Haldor Topse, has developed a production process using black liquor, a waste product from paper production. The EU is considering including bioDME in its biofuel mix and the Volvo Group has been co-ordinating a bioDME project in collaboration with Chemrec, Delphi, ETC, Haldor Topse and oil companies, Preem and Total. The project demonstrates the entire technology path from the paper mill via refuelling stations to Volvo trucks running on DME. The International DME Association launched a fleet of DME-powered buses in Shanghai prior to the 2010 Shanghai World Expo. DME is known to adversely affect many types of plastics and rubbers, with the exception of Teflon and butyl-n rubber, although its very low vaporisation temperature and the repeated temperature cycling can cause Teflon to become brittle, which may lead to safety valve seal failure. As a consequence, metal-to-metal seals using non-sparking metals are recommended. DME has poor lubrication properties and a high-pressure lubrication system is required for injector systems. Tests using DME in diesel engines have encountered leakage of DME past shuttle valves, requiring redesign of the shuttle valves.
Hydrogen
Although the use of hydrogen in fuel cell vehicles attracts more news, its use as an alternative fuel for ICE-powered vehicles is being pursued by BMW and Mazda, for example, and several niche vehicle manufacturers. BMWs research engineers have achieved thermal efficiency as high as 42% for hydrogen-powered ICEs and 45% is considered possible. Hydrogen has a relatively high energy density at about 143MJ/kg, compared to natural gas at about 55MJ/kg, and it can be used as an ICE fuel in much the same manner as natural gas. Like natural gas, it must be compressed or liquefied for on-board storage. Both storage options require some energy input and the use of gas cylinders poses space and weight challenges. In liquefied form it must then be kept at below -487 degrees Fahrenheit (-253 degrees Celsius), which requires significant energy consumption and carries the risk of leakage of a very volatile gas into the atmosphere via the safety valve system should the temperature exceed its extremely low boiling point. Hydrogen is produced in large quantities to supply the oil refining and fertiliser industries, among others. It is most commonly produced by steam methane reforming (SMR) of the methane that constitutes 70% to 90% of natural gas, or by the electrolysis of water. It can also be produced via the electrolysis of methanol, which, in turn is largely produced from natural gas. As a consequence, hydrogen production results in CO2 emissions unless renewable or nuclear-powered electricity is used to electrolyse it from water. Penn State University developed a hydrogen generation process using naturally-occurring bacteria and weak electrolysis to break down organic waste material, such as cellulose, glucose, acetate or other volatile acids. The only emission is water, and the reactors could, for example, be operated using waste water from food processing plants and other sites where waste water is treated. The process needs only around 10% of the electrical energy required for the production of hydrogen by hydrolysis. Toyotas Central R&D laboratories developed a more efficient method of producing hydrogen from ethanol by passing a water and ethanol mixture thorough a quartz tube containing a catalyst of rhodium and silicon carbide located inside an aluminium box. Heat is applied to the inside of the box using microwaves, which are readily absorbed by silicon carbide. Tests indicated that 0.92 litres of hydrogen were obtained from one millilitre of a 50:50 ethanol-water mixture, with energy conversion efficiency around 80%, which is twice as high as conventional technologies. However, the carbon intensity of the process depends on the feed-stock and production processes used to manufacture the ethanol.
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In May 2011, Honda and Air Liquide joined the Clean Energy Partnership (CEP). CEP is an international cooperation supported by the German government that seeks to show hydrogen is a feasible automotive fuel source. Members include Air Liquide, Berliner Verkehrsbetriebe BVG, BMW, Daimler, Ford, GM/Opel, Hamburger Hochbahn, Honda, Linde, Shell, Statoil, TOTAL, Toyota, Vattenfall Europe and Volkswagen. The CEP has a total budget of 1.4bn (US$1.9bn) for the 2007-2016 period. In February 2011, Hyundai signed a memorandum of understanding (MOU) with members of the CEP to help promote fuel cell electric vehicles (FCEVs). In the same month, Hyundai announced that it will test a fleet of FCEVs in northern Europe, supplying in-house developed FCEVs for operation in Norway, Sweden, Denmark and Iceland. An initial agreement for the project was signed recently in Seoul.

LPG is a by-product of petroleum oil and natural gas extraction and production, and consists largely of propane and butane with small quantities of ethane, pentane and the unsaturated compounds of propane and butane. Its octane rating is about 108 RON, but its energy density is lower than that of gasoline at 26MJ/litre compared to regular gasolines 34.8MJ/litre. As a consequence, the fuel storage space required for a similar range is greater than for gasoline, and the necessity of keeping LPG under pressure limits the fuel tank shape to that of a low-pressure gas cylinder. Furthermore, many LPG-powered vehicles are dual-fuel so that the LPG storage requirement is additional to the gasoline tank. LPGs lower energy density results in reduced engine performance of as much as 20%, particularly in a dual-fuel vehicle in which the modifications that can improve performance on LPG, such as raised compression ratio and altered ignition timing, cannot be made because of the need to operate on gasoline at least some of the time. LPG-powered vehicles have been popular in Europe, primarily in Italy, the Netherlands and, increasingly, in the UK. Most LPG-gasoline dual-fuel vehicles have been retro-fitted with LPG kits, but some OEMs now produce vehicles with factory-fitted, dual-fuel systems.
Natural gas
Compressed natural gas
Natural gas is a fossil fuel that is often found in association with petroleum oil and coal, although it is also found in large fields that are entirely gas. In the past, natural gas was not an economically-viable commodity and was simply burned off at oil extraction sites. That situation has changed to the degree that efforts are increasing to capture it or to pump it back into the well for later use as well as to help pressurise the well to assist oil extraction. The gaseous by-products produced during oil refinery still tend to be burned in the atmosphere, but this practice is also attracting increasing attention in terms of the waste of valuable fuel and the emission of significant volumes of CO2. Methane is the main constituent of natural gas, usually making up between 85% and 90%, although it can be as high as 98%. The other constituents include the heavier hydrocarbon gases, ethane, butane, propane and pentane, along with small quantities of CO2, nitrogen, helium and hydrogen sulphide. Hydrogen, which has similar properties to natural gas, can be mixed with it for use as a fuel. India, for example, has approved an 80:20 mix of natural gas and hydrogen for use as an automotive fuel. Natural gas is used widely for heating and electricity generation and is extensively reticulated via pipelines. For use as an automotive fuel, it is compressed to around 2,900psi (200bar) in industrial gas cylinders, which are now available in composite materials as well as the traditional steel. Although natural gass energy density by weight is 20% higher than that of regular gasoline at around 55MJ/kg, its storage as a compressed gas results in low energy density by volume and a typically shorter range per refuelling than is achieved with gasoline or diesel. In gasoline engines that are converted to use CNG, power output is typically reduced by 10% to 15% unless the compression ratio is increased to take advantage of CNGs higher octane rating of more than 120.
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In countries that have a natural gas source or supply, the reticulation infrastructure enables vehicle refuelling stations that can support a large fleet of CNG-powered vehicles. For many years, most natural gas-powered light vehicles were converted using after-market systems but, increasingly, OEMs are producing dedicated natural-gas cars and light commercial vehicles. Furthermore, some, such as Toyota and Kia, have combined natural gas operation with hybrid-electric technology to further lower toxic and GHG emissions and improve fuel economy and operating expenses. Westport Innovations produces natural gas truck engines based on Cummins units by adding tandem natural gas and diesel injection systems, a fuel-conditioning module, and a high-pressure pump to balance the pressures of the diesel and natural gas prior to injection. The engines operate on 2% to 5% diesel, depending on the operation cycle, to ignite the gas, and use exhaust gas recirculation and diesel particulate filters to control PM and SCR after-treatment to control NOx emissions. The engines are supplied to truck OEMs including Kenworth, Peterbilt and Sterling. Clean Air Power, which has past experience converting Caterpillar engines, has developed similar dual-fuel systems for Volvo and Navistar truck engines in which the diesel content is minimised to avoid the need for a spark ignition system. The engines utilise exhaust gas recirculation and require little modification other than the fitment of a separate gas injection system. They can operate normally on diesel alone. The American Power Groups GreenMan Technologies subsidiary has developed a similar system for after-market fitment.
Liquefied natural gas

Natural gas can be liquefied at atmospheric pressure by refrigeration to -260 degrees Fahrenheit (-162 degrees Celsius). The refrigeration process freezes out unwanted substances such as CO2 and hydrogen sulphide, and reduces its volume from the gaseous state by a factor of 610. The reduced volume makes it practical and economically-viable to transport by ship or road tanker to locations where it can be stored and converted back to its gaseous state for distribution and use. Transportation of LNG requires heavily-insulated, refrigerated tanks with comprehensive safety systems. The temperature within the tank will remain constant if the pressure is kept constant by allowing the boil-off gas to escape. The boil-off gas is collected and used as a fuel source in the facility or on the tanker transporting it. Figure 13: LNG tanker
Source: BP p.l.c.
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In May 2011, the board of Shell took the final investment decision on its Prelude Floating Liquefied Natural Gas (FLNG) Project. The wholly-owned project will become the worlds first FLNG facility. Once operational, probably in 2016, the vessel will be moored approximately 200km off the coast of Australia, producing gas from offshore fields and liquefying it onboard by cooling. The 488 metre long vessel will weigh around 600,000 tonnes, and spend 25 years in its first location, before moving to Shells next offshore gas field. Liquefied gas will be offloaded from the vessel to ocean-going LNG carriers, for delivery to markets worldwide. Prelude is expected to produce around 110,000 barrels of oil equivalent per day, equating to at least 5.3 million tonnes per annum (mtpa) of liquids, including 3.6 mtpa of LNG, 1.3 mtpa of condensate and 0.4 mtpa of liquefied petroleum gas. Figure 14: Shell Prelude Floating Liquefied Natural Gas (FLNG) Project
Source: Royal Dutch Shell plc
Biogas
Methane can also be produced through the decomposition of biomass, typically organic agricultural waste such as food crops, food waste, plant remains, animal manure or sewage sludge, in anaerobic digesters. This biogas is usually about half methane, with the main other gas being CO2 along with small amounts of nitrogen, oxygen and hydrogen, and traces of hydrogen sulphide and siloxanes, which can produce hard deposits during combustion. Advanced waste treatment technologies can produce biogas with 55% to 75% methane. Once water vapour, CO2, hydrogen sulphide and any silicanes are removed, biogas can be used as a fuel to power an ICE, either for electricity generation or automotive propulsion. Compressed biogas is becoming widely used in Germany, Sweden and Switzerland. A biogas-powered train has been in service in Sweden since 2005. The decomposition of organic material in landfills also produces biogas of similar composition to that produced in anaerobic digesters. Typically, landfill gas has been burned into the atmosphere to prevent it accumulating as an explosion risk. However, it is increasingly being captured, cleaned and used as an alternative fuel.
Methane hydrates
Methane hydrates are a frozen form of unconventional methane that are found in areas of permafrost and on the seabed. They are known to be extremely difficult to exploit and have thus been little studied to date such that estimates of global reserves vary widely. A 2002 report from the Soloviev Institute for Geology and Mineral Resources in Russia estimated methane hydrates reserves to be similar in volume to the remaining conventional reserves of natural gas but the US Geological Service has estimated that methane hydrates may contain more organic carbon than all the worlds coal, oil and conventional natural gas combined.
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Any exploitation of methane hydrates carries risks of large-scale uncontrolled release of methane. More alarmingly, it has been observed that climate change is warming the permafrost regions in northern latitudes and the trapped methane is beginning to be released, creating a further source of GHG emissions. The emergence of a similar trend in the oceans is also of concern. As the energy market comes under pressure, it is likely that increased efforts will be focussed on attempting to exploit this possible energy resource.
Hythane
Hythane is a mixture of hydrogen and natural gas, usually with around 20% hydrogen by volume, which accounts for 5% to 7% of the energy content but improves engine efficiency.
Gas to liquids (GTL)

It is technically possible to synthesise almost any hydrocarbon from any other, and several processes have been developed to synthesise liquid hydrocarbons from natural gas. Broadly, there are two technologies for producing synthetic petroleum products from the methane in natural gas: direct conversion and indirect conversion via synthesis gas (syngas), which consists of CO, CO2 and hydrogen. The direct conversion of methane eliminates the cost of producing syngas but involves high energy input and is difficult to control. As a consequence, none of the direct conversion processes developed so far has been economically attractive. Indirect conversion can be carried out via methanol production or by the Fischer-Tropsch synthesis process. During 2010, Carbon Sciences announced that it had developed a process to directly produce gasoline from natural gas and CO2, and filed further patents regarding a high-yield membrane reactor.
Indirect via methanol

There are two main processes used for the production of syngas from natural gas. In steam methane reforming (SMR), natural gas and steam are passed over a nickel catalyst at about 1,560 degrees Fahrenheit (850 degrees Celsius) and 145psi to 290psi (10bar to 20bar) to produce CO and hydrogen in the ratio of one unit of CO to three units of hydrogen. The second process, known as the syngas process, involves the partial oxidation of methane to produce two units of CO to four of hydrogen and significant heat, which can be used in situ to drive the SMR process. The ratio of CO and hydrogen produced can be adjusted by altering the proportions of water and gas in a process known as the water gas shift reaction. The CO and hydrogen produced by SMR, partial oxidation or a combination of the two is then passed over a second catalyst, which is most commonly a mixture of copper, zinc oxide and alumina, at 480 degrees Fahrenheit (250 degrees Celsius) and 725psi to 1,450psi (50bar to 100bar) to produce methanol. Because the syngas includes excess hydrogen, CO2 can be injected into the reaction where it will combine with hydrogen to form methanol and water. The methanol is then dehydrated to produce DME and water, and then further dehydrated over a zeolite catalyst to produce gasoline. In the Mobil methanol-to-gasoline (MTG) process, methanol is first converted to an equilibrium mixture of methanol, DME and water. In the second stage, the equilibrium mixture is mixed with recycled gas and passed over a catalyst to form hydrocarbons and water. Most of the hydrocarbon products are in the gasoline range and are collected to produce a low-sulphur, low-benzene gasoline. In the MTG process, 1,000 tonnes of methanol produces 387 tonnes of gasoline, 46 tonnes of LPG, seven tonnes of fuel gas and 560 tonnes of water, which is recycled as process water.
Fischer-Tropsch
The Fischer-Tropsch process was discovered in Germany during the 1920s and was used to produce synthetic fuel from coal in Germany during the Second World War and in South Africa during the apartheid era when embargos limited the supply of petroleum. The process uses syngas produced from any hydrocarbon feed-stock and involves several competing chemical reactions that produce mixtures of target alkane hydrocarbon products and unwanted byAlternative fuels and the global auto industry (2nd edition) automotiveworld.com
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products such as alkenes, alcohols and other oxygenated hydrocarbons. The product mix can be adjusted by altering the catalysts used and the process conditions, including the water gas shift reaction as per the MTG process. For the synthesis of automotive fuels, the target products are the heavier liquid alkanes most commonly found in gasoline and diesel. To achieve this, the temperature is kept in the 300 to 575 degree Fahrenheit (150 to 300 degrees Celsius) range because higher temperatures tend to favour the production of shorter hydrocarbon chains. Higher pressure tends to favour the production of longer-chain hydrocarbons although ultimately the cost of high-pressure equipment offsets the benefits. Cobalt-based catalysts are suitable for the optimal hydrogen:CO ratio of around 2:1, while iron-based catalysts promote the water gas shift reaction and lower ratios can be processed. Fischer-Tropsch diesel can be produced directly, but a higher yield is achieved via the production of wax, followed by hydrocracking. Fischer-Tropsch diesel is similar to petrodiesel in terms of energy content, density and viscosity and it can be blended with petrodiesel in any proportion without the need for engine or infrastructure modifications. It has a higher cetane number and lower aromatic content, which results in lower NOx and PM emissions.
Coal to liquids
Coal can also be used as a feed-stock to produce syngas by reacting steam with coal slurry produced by the wet milling or grinding of coal. The process produces a wet slag and syngas that contains a variety of impurities that must be removed before it is used to synthesise hydrocarbons. For example, a process developed by General Electric involves conditioning the gas using a mercury absorber, a carbonyl sulphide hydrolysis reactor, an acid gas remover and sulphur beds. The acid gas removed is used to produce a liquid sulphur product in a sulphur recovery plant. The syngas can then be used to synthesise hydrocarbons via methanol or the Fischer-Tropsch process. Several direct coal liquefaction processes have been developed, and were first used in Germany during World Wars I and II. Direct liquefaction was experimented with in South Africa and Gulf Oil developed its Solvent Refined Coal process, which was implemented in pilot plants in the US in the 1960s and 1970s. Another direct hydrogenation process was explored by the NUS Corporation in 1976, using dried, pulverised coal mixed with molybdenum catalysts under high temperatures and pressures. This approach produced synthetic naphtha, small amounts of propane, butane and ammonia, light- to medium-weight alkanes ranging from pentane to decane, which are suitable for use as fuels, and significant amounts of CO2. Liquid hydrocarbons can also be produced via the low temperature production of coke from coal during which coal tars are produced that are richer in lighter hydrocarbons than normal coal tar. The coal tar is then further processed into fuels. Estimates of the cost of producing liquid fuels from coal suggest that domestic US production of fuel from coal is cost-competitive with oil priced above US$35 per barrel, making coal-to-liquids processes economically viable against recent oil prices.
Waste to liquids (WTL)

In 2009, Novo Energies Corporations subsidiary, WTL (Waste to Liquid) Renewable Energy, announced a new process capable of producing liquid fuels from plastic and tyre wastes, and disclosed plans to commence operations at its first production plant during 2010.
Carbon dioxide to fuel

In 2008, Carbon Sciences of California announced a breakthrough in biocatalytic enzyme technology to convert CO2 into hydrocarbons that can then be used to synthesise gasoline, diesel or aviation fuel. The company claims that the technology is much less energy intensive than other synthetic fuel or biofuel production methods and is scalable to produce commercial volumes. During 2009, the company filed patent applications for its process and announced that
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it had developed a laboratory scale prototype production unit and had successfully produced methanol. In 2010, an alliance of US industry, academic and government organisations was formed to commercialise technologies to use concentrated solar energy to convert waste CO2 into diesel. Alliance members include Sandia National Laboratories, Renewable Energy Institute International, Pacific Renewable Fuels, Pratt Whitney Rocketdyne, Quanta Services, Desert Research Institute and Clean Energy Systems and funding was obtained from the National Energy Technology Laboratory. The alliance announced plans to establish facilities next to plants that have waste CO2 streams, such as coal power stations, natural gas processing plants, ethanol plants and cement production plants.
Vegetable oils
Rudolf Diesels first truly successful compression ignition engine, which he demonstrated at the World Fair in 1900, ran on peanut oil. Many vegetable oils have similar properties to diesel and can be used in some diesel engines provided the fuel system and other components are suitably modified. The most commonly used pure vegetable oils used as fuels include rapeseed, which has a gel point of 14 degrees Fahrenheit (-10 degrees Celsius), and sunflower oil, which has a gel point of 1.4 degrees Fahrenheit (-17 degrees Celsius). In hotter climates, coconut oil can be used, provided the temperature does not drop below 63 degrees Fahrenheit (17 degrees Celsius). Oils with higher gel points can be blended with oils with lower gel points, although oils with lower gel points tend to be less saturated and are less stable with respect to oxidation. The main problems with using vegetable oils in diesel engines are their higher viscosity, lower cetane ratings and poorer stability to oxidation. In cold conditions, some vegetable oils will turn to wax. The higher viscosity can cause problems with fuel pumps and injector systems and prevents adequate atomisation of the fuel, resulting in incomplete combustion, increased PM emissions and carbon build up in the injectors and other combustion chamber components. A common solution to the viscosity problem is to heat the vegetable oil, either electrically or via a heat exchanger that uses the coolant from the engine, in the fuel tank or in the fuel line. Cold starting problems can be overcome by fitting two fuel tanks, one with the vegetable oil and one with diesel (either petrodiesel or biodiesel). The diesel is used for cold starting and initial operation. The vegetable oil is used once it has reached 158 to 176 degrees Fahrenheit (70 to 80 degrees Celsius). The fuel system is then switched back to diesel before the engine is shut down in order to purge the vegetable oil from the filters and injector system. Several aftermarket companies offer two-tank and single-tank conversion products for diesel vehicles, typically along with modified injector nozzles, increased injection pressure, stronger glow-plugs and a pre-heating system for the vegetable oil tank. Single tank conversions have been developed, largely in Germany, in order to provide reliable operation with rapeseed oil that meets the German oil fuel standard. Another approach used to improve viscosity problem is that of adding diesel, kerosene, mineral turpentine or gasoline in various quantities and ratios. However, little is known about the long-term effects of these additives on engine wear and performance. Modified indirect injection engines, such as older Mercedes-Benz and PSA Peugeot Citron XUD engines (the latter is fitted with a heated fuel filter as standard), or those fitted with Bosch mechanical injectors, have been found to operate well in temperatures down to 14 degrees Fahrenheit (-10 degrees Celsius). However, problems have been reported with Lucas CAV fuel pumps. Direct injection engines, other than Volkswagen TDi engines, generally require preheating of the engine block. It has been found that the sensors in computer-controlled injection systems that measure temperature and flow rates can respond to the more viscous fuel by switching the fuel system to safe mode, resulting in loss of power. The electric lift pumps that supply fuel to the injector pumps can fail because of the high viscosity of the vegetable oil, resulting in subsequent failure of the expensive injector pump. Also, systems with copper components can catalytically oxidise the oil.
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Some conversion kits include a replacement fuel filter that increases filter mesh from the recommended 10 microns to 30 microns, in order to allow wax crystals through. This can also, however, allow other less desirable particles through, which may lead to damage of the injector pump or nozzles, and coking of the engine. When used cooking oil is used, filtering does not remove water or acidic contaminants that can cause system damage. To manage this, the pH of the oil must be measured and the acid content neutralised with the addition of an alkaline compound, such as sodium hydroxide.
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Alternative Fuels and The Global Auto Industry Report

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Alternative Fuels and The Global Auto Industry Report

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Alternative fuels and the global auto industry (2nd editon)

Alternative fuels and the global auto industry (2nd editon)

Published: June 2011

ABOUT THE AUTHORS

Toxic emissions regulations

Regulations requiring biofuels use

MARKET DYNAMICS AND FORECASTS

Alternative fuels and the global auto industry (2nd edition)

Biogasoline Dimethyl ether Hydrogen Liquefied petroleum gas Natural gas

Gas to liquids (GTL)

Alternative fuels and the global auto industry (2nd edition)

LIST OF FIGURES & TABLES

Alternative fuels and the global auto industry (2nd edition)

Alternative fuels and the global auto industry (2nd edition)

Alternative fuels and the global auto industry (2nd edition)

Chapter 1: Market drivers

Alternative fuels and the global auto industry (2nd edition)

Sources: CIA World Fact Book, US Energy Information Administration

Alternative fuels and the global auto industry (2nd edition)

Carbon dioxide emissions regulations

The United States

Toxic emissions regulations

Dimethyl ether (DME)

Alternative fuels and the global auto industry (2nd edition)

Natural gas (NG)

Liquefied petroleum gas (LPG)

Regulations requiring biofuels use

The United States

The United States

The European Union

Alternative fuels and the global auto industry (2nd edition)

Alternative fuels and the global auto industry (2nd edition)

Chapter 2: Market barriers

Alternative fuels and the global auto industry (2nd edition)

Alternative fuels and the global auto industry (2nd edition)

Figure 3: E85 station distribution by US state

Source: US Department of Energy

Actual greenhouse gas emissions reductions

Liquefied petroleum gas

Source: Argonne National Laboratory

Alternative fuels and the global auto industry (2nd edition)

Reduced fuel storage and operating range

Competition with food

Alternative fuels and the global auto industry (2nd edition)

Chapter 3: Market dynamics and forecasts

Alternative fuels and the global auto industry (2nd edition)

Market dynamics and forecasts

MARKET DYNAMICS AND FORECASTS

Market dynamics and forecasts

Figure 8: Global biodiesel production forecast to 2019 (billions of litres)

Liquefied petroleum gas

Source: Agricultural Outlook

Alternative fuels and the global auto industry (2nd edition)

Market dynamics and forecasts

Alternative fuels and the global auto industry (2nd edition)

Chapter 4: Alternative fuels

Alternative fuels and the global auto industry (2nd edition)

Cellulosic biomass Biogasoline F-T diesel

Alternative fuels and the global auto industry (2nd edition)

Liquefied petroleum gas

Alternative fuels and the global auto industry (2nd edition)

Liquefied natural gas