Biofuels: Garbage to Gold
Are biofuels making a comeback in Alberta?
by Alexandria Eldridge
Most people wouldn’t consider garbage useful, but then those people probably haven’t heard of Enerkem. The Quebec-based company is, in partnership with the city of Edmonton, building the world’s first industrial-scale waste-to-biofuels facility. The project is expected to start operating late this year, and will take garbage that can’t be recycled or composted and turn it into methanol or ethanol that can be sold to refineries. The process uses low temperatures and pressures, so energy inputs are minimal. When fully operational, 30 per cent of Edmonton’s waste will be processed into biofuel, which reduces greenhouse gas emissions by more than 60 per cent.
It’s a process that effectively transforms trash into treasure, and it’s indicative of the direction the biofuels industry is headed in Alberta. “We are leading the first wave of commercial facilities that will be producing advanced biofuels,” says Marie-Hélène Labrie, vice-president of government affairs and communications at Enerkem. “There’s really now a diversity of feedstock that will be used because there are new technologies.”
When the biofuel boom first began a decade ago, the feedstock was traditional grains and oils. These first-generation feedstocks were to be the inputs for numerous projects that sprung up across the province after 2004 and created a wave of excitement. The Alberta government had invested $150 million in the industry by March 2010, and in 2011 the provincial and federal governments both brought in blending requirements of five per cent biofuel in gasoline and two per cent in diesel.
These initiatives were supposed to spur the industry forward, but that never happened. Instead, the biofuel plants that were planned in towns like Vegreville, Stettler and Rimbey were never built, with some cancelled outright and others seemingly on hold permanently. “My opinion is we probably mistimed our entry point in that we tried to fund commercial right at the time where the only available technologies to go commercial were those first-generation ones,” says David Bressler, the executive director of the University of Alberta’s Biorefining Conversions Network and a specialist in biomass conversion.
The financial crisis in 2008 made it even more difficult for projects to secure financing, and it left the biofuels industry shaken. But Bressler believes the industry is on the verge of making a major comeback. “The capital markets are starting to return to > investments in some of these spaces. On top of that we have the evolution of these second- and third-generation technologies that are coming online that are much more efficient,” he says. “The next five years is going to be a really interesting time.”
The advanced biofuels side of the industry seems to be picking up steam. Bressler himself, through an investment in a company called Forge Hydrocarbons, is commercializing a process to convert non-edible fats and oils into renewable fuels. There’s the Enerkem project, which when operating at full capacity in 2015 will produce 38 million litres of biofuel per year. In Hairy Hill, Growing Power is developing the country’s first integrated bio-refinery. The plant will bring in grain and process it into ethanol, then use the residual materials to feed cattle whose manure will be used to produce fertilizer and green electricity. The company estimates the project will produce 40 million litres of ethanol and 30,000 tonnes of bio-fertilizer each year, and because the plant can use the electricity it generates to fuel its own processes, it will be extremely energy efficient.
In Lloydminster, meanwhile, a conventional project is proceeding. Archer Daniels Midland is building North American’s largest biodiesel plant, which is set to produce 250 million litres a year once it opens (if it’s on schedule) later this year. “I think the fact that we’re building a 250-million litre facility in Alberta is the best evidence that the industry is back up and running,” says Scott Thurlow, president of the Canadian Renewable Fuels Association. Alberta Energy reports that Alberta’s ethanol production capacity was 90 million litres in 2012. If all the projects under development are completed, that figure would grow to 525 million.
Much of this activity will have to take place without government investment. The federal government decided earlier this year not to continue funding its renewable fuels program. And Alberta Energy is no longer accepting new applicants to its producer credit program (which provides funding based on how many litres of biofuel a company produces), although it will honour commitments to previously approved companies until 2016. By all accounts, though, the programs weren’t much help anyways. In Innisfail, plans for a biodiesel refinery and ethanol plant were scrapped earlier this year, largely due to a lack of co-ordination between the federal and provincial programs. “We had support from federal and provincial governments at different times,” says Curtis Chandler, president of Dominion Energy Services, the company that was heading up the plant. Adding to that, the federal government required a tight construction timeline of only 12 months, which just wasn’t feasible. “It would’ve been good for the province,” Chandler says.
But for Bressler, a lack of government funding moving forward isn’t necessarily a bad thing. “A good biofuel business should not need government subsidy,” he says. ”The ones that go forward will do so based on a business case.” The Alberta government is still supporting biofuels research through Alberta Innovates Bio Solutions, and spokesperson Kimberly Budd says the elimination of the producer credit program doesn’t mean the government has given up on the industry entirely. “It was a budgetary matter,” she says. “Right now we’re looking at an alternative and renewable energy framework and I think any future programs will be the result of what comes out of that.”
That decided lack of enthusiasm for so-called first generation biofuels isn’t exclusive to Alberta, either. Many people have argued that the environmental cost incurred in growing the crops and running the plants outweighs the benefits of using biofuels, and there’s an ethical concern that food is being used to produce fuel at the same time that global food scarcity is becoming an issue.
But it’s these concerns that have Bressler believing the future of advanced biofuels is bright. “It isn’t ‘food versus fuel,’ ” he says. “It’s, ‘How do we maximize our efficiencies generally?’ Everything we do, if we do it correctly, has to be engaging social, environmental and economic elements and we have to keep a social licence to what we’re doing.”
That’s why projects like Enerkem’s Edmonton facility hold such promise for the industry.
“We believe that the Enerkem facility has the potential to become a model for municipalities around the world to more sustainably manage their waste,” says Enerkem’s Labrie. “From an energy perspective, I think we provide a solution that helps diversify and green our energy basket.”
The range of potential solutions won’t stop there, either. Canadian Natural Resources is working with Ontario-based Pond Biofuels on a project that will use industrial waste from its oil sands site (carbon dioxide, water and heat) to grow algae in an attached bio-refinery. The algae will produce useful products, including biofuel and fertilizer. Once developed, the technology could help address the energy industry’s emissions problems – or maybe even solve them altogether.
“The days of trying to take entire areas of cropland and just turning it into fuel for the sake of doing it for political reasons are probably disappearing,” Bressler says. “We’re at the beginning of a tidal wave of the more advanced, more efficient and more economically competitive technologies that are coming down the pipe right now.”
Fuelling an evolution
Biofuel has been around for years now, and in large quantities. In Canada, 2.1 billion litres of ethanol are blended into gasoline each year. And with a greater demand for more efficient biofuel production, the technology is changing to allow for the use of more advanced feedstocks in the process. Here’s a look at the different stages of biofuel technology.
Conventional biofuel derived from sugars, fats and oil. Archer Daniels Midland’s Lloydminster plant will use feedstock from its canola-crushing plant right next door.
Feedstock that is not food crops. It can include grasses, waste vegetable oil, municipal solid waste, trees and residues. Enerkem’s Edmonton project using municipal solid waste as a feedstock is an example of a second-generation biofuel project.
Third-generation biofuels are derived from algae or other microbes. In many cases, advanced biofuels are indistinguishable from petroleum sources and can be used as a direct substitute, rather than having to be mixed into fuel. The partnership between Pond Biofuels and Canadian Natural Resources will use algae (grown from industrial waste) to produce biofuels and other products.