Estimates of capital costs for biofuel plants (or any other developing technology) are uncertain due to the many influencing factors. An example is the 18 million litres/yr CHOREN bioethanol plant whose costs escalated from €500 million in early 2007 to €1000 million in early 2008 (Bridgwater, 2009). Nevertheless, several estimates are available for different biofuel technologies. One of the most comprehensive and consistent studies currently available, carried out by DENA (2006), puts the cost of thermo-chemical plants between €525 and €650 million for plants treating 1 million tonnes of wet biomass and producing 105 000-120 000 tonnes of biofuel per year. In addition to the economic benefits, this option provides operational and organisational synergies and significantly lowers the plant availability risk. Integration into an existing refinery or chemical plant can also accelerate the planning procedure and can lower investment costs by around 25% (DENA, 2006).

Table 3.6 shows the process options considered, and Table 3.7 shows the breakdown of costs. Processing route 1 appears to be economically the most sustainable option.

It is interesting to note that integration into an existing refinery or chemical plant is the most cost-effective option across the different processing routes. In addition to the economic benefits, this option provides operational and organisational synergies and significantly lowers the plant availability risk. Integration into an existing refinery or chemical plant can also accelerate the planning procedure and can lower investment costs by around 25% (DENA, 2006).

Even fewer estimates are available for the capital costs of bio-chemical plants. A recent study by the U S EPA (2009) estimates the costs for a bio-chemical plant producing 56 million gallons/yr of ethanol from 849 385 dry tonnes/yr of corn stover at $133 million/yr (for the year 2010). With other costs added (including site development, project contingency, etc.), the total project investment costs are estimated at $232 million/yr (US EPA, 2009). For the years 2015 and 2020, the annual costs are predicted to go down to $220 million and $198 million, respectively.