Driven by aggressive biofuel mandates, rapid industry growth will cause great strain on biomass by 2030, according to analysis firm Lux Research. A report from the firm says that, using today's technologies, an area the size of Russia would need to be cultivated to replace all petroleum used for chemicals and fuels, and feedstock innovation will be needed to keep growing biomass's market share.

But the future doesn't look grim for biofuels, according to Kalib Kersh, Lux's bio-based materials and chemicals/alternative fuels analyst. Kersh told REW that he believes some developers will deliver the needed innovation, though others will flounder. “When cellulosic pre-treatment technologies come to commercial viability in the next several years, biofuels and biocemicals producers will have new options for feedstocks,” he said. “In turn that will create a new variation of agriculture, stimulating biomass production in a very efficient way.” And Kersh saw more investment in the bioenergy sector in 2012 than ever before.

When Stresses Bite

Today biofuels and biochemicals need more than one billion metric tons of material per year to replace 3 percent of total petroleum products, according to Kersh. “By 2030 this number will soar to 3.7 billion metric tons,” he said. To meet this growing challenge, measures will be needed such as crop modifications, new value chain configurations and agronomic technology improvements like irrigation and biosensors.

Kersh is “cautiously optimistic” that these measures will be taken - although particular regions could be problematic. What will happen if industry innovation doesn't materialize to the levels necessary to avert a crisis? Kersh said his research had led him to conclude that Japan, North America and Brazil would end up being importers of biomass. “It's almost impossible to see it happening otherwise”, he said. And he warned that “it's always possible that some of these countries will backpedal on their mandates”, although he cautioned that it's too soon to tell.

Costs Can Be Lowered

New logistics methods could lower costs, according to the report. Alternative fuel companies such as Sweetwater Energy and BlackGold Biofuels are developing 'hub-and-spoke' models to build satellite intermediate conversion facilities that feed into a central processing facility, cutting transportation costs. According to Kersh, the largest contributing cost in bioenergy production is the feedstock. Other contributors to cost are in harvesting, processing, transport and, in some cases, storage.

The Public Opinion Factor

It may surprise some that the biofuels market appears to be burgeoning despite widespread public debate over food vs fuel and destruction of the world's rainforests. Kersh shed some light on the issues: “For one thing,” he told REW, “sugar cane in Brazil is actually grown far from rainforests; it needs a fairly dry environment for part of the growing season.”

In terms of the food vs fuel debate, Kersh believes that “some disingenuous players” have been making much of the issue, but that it “doesn't make that much sense”.

“The issue of food security needs to be dealt with head-on, not in an indirect way by attacking biofuel,” he said. “There is plenty of grain and plenty of foodstuffs for everybody; the problems are not a matter of supply.”

In the US, he said, the American Petroleum Institute has exerted efforts to eliminate the Renewable Fuel Standard (RFS2). "The irony of that," said Kersh, "is that use of ethanol frees up other petroleum-derived blend-stock fractions for higher-value sale to other, non-fuels markets."