1. NNFCC
Bio-Based Products
Opportunities and Challenges
Dr Adrian Higson
February 2012
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
2. NNFCC
Background
The production of renewable
economy
biological resources and the
conversion of these resources
and waste streams into value
added products such as food,
feed, bio-based products and
bio- bioenergy
economy
Products that are wholly or partly
derived from materials of
bio-based biological origin excluding
products
materials embedded in
geological formations and/or
fossilised
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
3. NNFCC
Market Dynamics
Brand owner focus
Climate change Politically Consumer Environment
Mandates/Support Driven Pull Functionality
Raw
Volatility Hedging Technology Industrial Biotech
Material
Future proofing Push New chemistry
Flexibility
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
4. NNFCC
Comparative Feedstock Pricing
Comparison of Commodity Indices (2005 = 100)
300
250
200
150
100
50
0
Crude Oil (Petroleum) Index (monthly)
Commodity Agricultural Raw Materials index (monthly)
Commodity Food Price Index (monthly)
The UK’s National Centre for Biorenewable Energy, Fuels and Materials Source: IMF
5. NNFCC
The value of biomass
Increasing value
Decreasing volume
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
6. NNFCC
Biomass – A love hate relationship!
• Available on demand
Strengths
• Carbon source
• Cost
Weaknesses
• Physical nature
• Energy generation (heat and power)
Opportunities • Liquid transport fuels
• Chemicals and materials
• Competition for land
Threats
• Environmental pressure
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
7. NNFCC
Developing the bio-based economy – The issues
• Varying levels of • Large financing • Food security • Public
support requirements • Land rights perception of
• Policy for capital GM
inconsistency projects technologies
Political Economics Social Technology
• Climate change • Biodiversity
agreements • Land use
• Energy change
obligations
Legal Environment
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
8. NNFCC
Market building - European Lead Market Initiative
• Standards, labels and certification
• Legislation promoting market
development
• Product specific legislation
• Legislation related to biomass
• Encourage Green Public
Procurement
• Financing and funding of research
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
9. NNFCC
Bio Chemicals and Bio-Based Polymers
(all areas of economy)
Chemical Derivatives Naval Stores
Market size Natural Products Oleochemicals
~ 50 million tones Biopolymers Amino Acids
Alcohols Aliphatic acids
Other
Fermentation Products
54%
7%
4%
17%
1%
7% 5%
1%
20%
1%
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
10. NNFCC
Opportunity, complexity, and confusion
The UK’s National Centre for Biorenewable Energy, Fuels and Materials Source IEA Task 42, NNFCC
11. NNFCC
Today’s situation Hurdles
• Lignocellulose deconstruction
• Fermentation scope and yields
• Downstream processing
Game changers
• Synthetic biology
• Synthesis gas fermentation
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
12. NNFCC
Bio chemical outlook
• Consumer preference
Strengths • Reduced carbon footprints & fossil energy use
• Novel / Improved function
• Low volume / High costs
Weaknesses • Immature supply chain
• Market confusion
• Oil price volatility
Opportunities • Capture C3 and C4 markets
• Co-development with fuel industry
• Feedstock supply
Threats • Alternative feedstocks (coal, gas)
• Environmental pressure
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
13. NNFCC
Supply chain questions
• What’s the value proposition in bioplastics?
– Function vs renewable content
• What does the environmental footprint look like?
– greenhouse gas emissions, water impacts
• How big is the potential market opportunity/impact? Time horizons
– niche or mainstream 2020
– true rate of development 2030
2050
• What do the resource requirements look like?
– Availability, price, impact on other markets
• How will technology develop?
– Synthetic biology, perennial crops etc
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
14. NNFCC
Bio chemical platforms – Novel or drop in?
• Drop in – known targets and downstream products
Strengths • Novel – exploits attributes of biomass or biological
processing
• Drop in – number of unit operations required
Weaknesses
• Novel – requirement for product development
• Drop in - rapid route to market through existing
Opportunities infrastructure and know how
• Novel – provides new or improved functionality
• Drop in – production never achieves cost
competitiveness
Threats
• Novel – immature supply chain and market
awareness
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
15. NNFCC
Expansion of drop-in bio-based chemicals
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Methanol
Formic Acid
Ethanol
Ethylene
Ethylene Oxide
Ethylene Glycol (MEG)
Acetic Acid
Ethyl acetate
Epichlorohydrin
Acetone
isoPropanol
Propylene
Bio chemicals
Propylene Glycol
1,3-Propanediol
Lactic acid
Acrylic Acid
n-Butanol
iso-Butanol
iso-Butylene
Butadiene
Succinic acid
2,3-Butanediol
1,4-Butanediol
Tetrahydrofuran
Isoprene
Adipic acid
HMDA
Benzene
Toluene
Paraxylene
Terephthalic acid
Styrene
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
16. NNFCC
Bio chemical platforms
60%
Ethanol Ethylene Polyethylenes
7%
Styrene
Polymers/Rubbers
Monomer
Ethanol production ~ 60 million tonnes
14%
Ethylene production ~ 110 million tonnes Ethylene
Polyester
Oxide/Glycol
12%
EDC PVC
7%
Other Alpha Olefins
PVA
The UK’s National Centre for Biorenewable Energy, Fuels and Materials Source: Nexant ChemSystems
17. NNFCC
Bio chemical platforms
Polybutylene
Succinic Acid 1,4-Butanediol Terephthalate
Tetrahydrofuran Copolyester Ethers
Deicers/Coolent
Polytetramethylene
Ether Glycol
Solvent Thermoplastic
Plasticisers Polyurethanes
g-Butyrolactone Spandex Fibres
Fuel Additives
Fine & Speciality
Chemicals
N-Methyl -2- N-Vinyl-2-
Pyrrolidone 2-Pyrrolidone
Pyrrolidone
Fine & Speciality Fine & Speciality Polyvinyl
Chemicals Chemicals Pyrrolidone
The UK’s National Centre for Biorenewable Energy, Fuels and Materials Source: Nexant ChemSystems
18. NNFCC
Production regions
Geographical regions offer different opportunities
and pose different challenges e.g.
• Feedstock sustainability and availability?
• Access to skills and wider business support?
• Access to downstream markets?
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
19. NNFCC
Bio Polymer Scenarios - land requirements (2030)
50
% of available land
40
30
Chemical driven
20 Biofuel stalled
10 Biofuel driven
0 Bioeconomy
Plastic demand – 428 million tonnes
Land availability – 250-800 million ha (Source FAO)
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
20. NNFCC
Maximising resource use
raw material
Material Cycle Energy Cycle
The UK’s National Centre for Biorenewable Energy, Fuels and Materials
21. NNFCC
The NNFCC provides high quality, industry leading consultancy
for more information contact us
Email - enquiries@nnfcc.co.uk
Twitter - @NNFCC
+44 (0) 1904 435182
• Future Market Analysis • Technology evaluation & associated
• Feedstock Logistics Planning due diligence
• Sustainability Strategy • Project feasibility assessment
Development • Policy and regulatory support
The UK’s National Centre for Biorenewable Energy, Fuels and Materials