5.2.7.1 Complete Process Cost Models

Acknowledging the great uncertainties in establishing guideline costs for lignocel — lulosic feedstocks, a Swedish review of the bioethanol industry in Scandinavia and elsewhere in 1999 noted that large-scale processes and improved overall ethanol yield would be highly desirable for future economic production of biofuels.28 The first trend probably heralded the demise of the farm-scale ethanol plant (section 5.2.1.4), a production model that probably is only relevant to local and private consumption

[50] Data published by the DOE’s Energy Information Administration (www. eia. doe. gov and www. tonto. eia. doe. gov) point to refinery gate prices of gasoline being 70% of the retail price (excluding taxes), although this increases to 90% or more during crude oil price surges; figure 5.5 was constructed from the U. S. conventional gasoline bulk prices after January 1994 and, between 1983 and 1994, the cor­responding retail prices x 0.70.

[51] Willow already has considerable commercial experience in Sweden, the United Kingdom, and elsewhere and has strong potential in Eastern Europe where growing conditions and economics are favorable.

• Poplar is already grown for pulp production, with typical rotation cycles of eight to ten years.

[52] Fuel ethanol production was initiated from cereal grain feedstocks, but a government-set selling price of $1.65/gallon required large subsidies because the production costs were more than $1.80/gallon.

• Total biomass production could exceed the International Energy Agency’s prediction for transportation fuel needs by 2030 at a low feedstock cost ($22/dry ton).

[53] Crop productivity is projected to increase slightly at mid to high latitudes for local mean temperature increases of up to 1-3°C depending on the crop and then decrease beyond that in some regions.

• At lower latitudes, especially seasonally dry and tropical regions, crop pro­ductivity is projected to decrease for even small local temperature increases (1-2°C), which would increase risk of hunger.

• Globally, the potential for food production is projected to increase with increases in local average temperature over a range of 1-3°C, but above this, it is projected to decrease.

• Adaptations such as altered cultivars and planting times allow low and mid to high cereal yields to be maintained at or above baseline yields for modest warming.

• Increases in the frequency of droughts and floods are proj ected to affect local production negatively, especially in subsistence sectors at low latitudes.

[54] South African businesses are planning to open 18 corn-based ethanol production sites within the national borders by 2012.

a counterbalance to the lure of accelerated growth and development as absolute, uncontested priorities in emerging/developing/transitional economies. The reality, however, is more likely to be close insistence on a reliability of bioethanol supply to Europe, Japan, and the United States, despite fluctuating growing conditions from year to year (as occurred, for example, in the dip in ethanol production in Brazil in 2001-2002): consumers with flexibly fueled vehicles will, under those conditions, turn back to gasoline and diesel, thus inhibiting the progress of biofuels programs.106 Although short-lived oil gasoline price bubbles are tolerated (in the absence of any real choice), shortfalls in fuel ethanol supply are unlikely to be; considerations such as those of encroachment on to virgin and marginal land in the tropics, deforestation, and loss of soil carbon may be much lower down the agendas of publics and policy­makers inside and outside the OECD.