Misguided Thinking; Let’s Talk the Drawbacks of Biofuels, Wood Pellet and Land-fill to Gas
We are all for a mosaic of solutions to transition our energy supply but we have to be careful to thoroughly asses any direct investment in certain types of projects. Some investments are not the solution they seem to be on first blush. While there are definitely technology upgrades lately that make biomass energy and biofuel manufacturing more efficient and less energy intensive, any combustion of the resulting product has emissions.
To date, most analysis does not account for the end of pipe CO2 released when biofuels are burned for energy. Synapse Energy Economics estimated that the average smokestack of a US biomass plant emitted about 1.67 tons of CO2 per megawatt-hour of electricity generated, or 50 to 85 percent greater than emissions from a coal-fired plant. Early assessments offered that biomass is carbon neutral because the plants used in the process are a carbon sink — this is now considered an erroneous assumption by the European Environment Agency. Almost as a confirmation of this, it seems like Europe has not included biomass emissions in its CO2 assessment from 2000–2016 presumably because to do that, would detract from the overall emissions reductions made.
The number of US biomass power plants almost doubled between 2003 and 2016, from 485 to 760. In Europe biomass consumption for energy production is up 84 percent since 2000 and biomass accounts for about 19 percent of the electricity generated from renewables. But these projects aren’t doing well. Biomass project returns are rather risky with high operational costs, subsidy and fast changing tax incentives, technical failures and accidents.
In 2018 Uniper received €930 in subsidies to replace coal with biomass but the plant’s book value has fallen by more than half. Subsidies haven’t been much help for Drax power in the UK which has a biomass plant that contributed to losses in 2017 and 2018. In the US, Biomass generation declined in 17 states from 2013─2017, because burning wood is expensive compared to traditional power plants and other renewable generators. More than 27% of biomass capacity now offline in California.
After “clean coal” technology, Goldman Sachs’ new favorite solution is wood pellet power and its favorite start-up Enviva Power. Wood pellet tech is supposed to beneficially use up dry forest underbrush and fallen trees. That part would be good if it were true. The Guardian reports that rather than waste wood, these plants may be getting supply from pristine forest in North Carolina. Note the Drax facility runs on 9 million tons of wood pellets per year, shipped 3,000 miles from the US and Canada. The fact that the world’s worst EPA Administrator, Scott Pruit likens wood pellet energy to solar and wind, deepens the skepticism.
Given that methane has much greater global warming potential than carbon, we absolutely should be capturing the methane that is emitted from landfill decomposition. That said, how unfortunate that it is then turned into natural gas for power plants when wind power is down to 2 cents per watt now! There has to be another way to monetize the captured methane without unnecessarily prolonging our reliance on fossil fuel combustion.
While the intentions can be good, the overall life cycle of these solutions has be part of the due diligence.
Heather Langsner, VP Analytics
A scathing new report from the Rachel Carson Council examines the wood pellet biofuel industry, specifically the industry leader’s operations in North Carolina, and its “severely adverse” environmental and health effects.
Investing in tech is always a risk but some risk is worth taking more than others. Why not invest in something that actually removes the CO2 from the atmosphere rather than adding to it? The Foundation for Climate Restoration believes if we could focus our investments on these solutions we could remove a trillion metric tons from the atmosphere by 2050. https://circularcarbon.org/company-index/
In Natural Capitalism: Creating the Next Industrial Revolution, the authors discuss how businesses can be environmentally responsible and highly profitable.
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